E.D. Hart

Beaten Down Natural Gas Likely to Stay Down, Making Producers a Short

Let it be stated that Oil is trading at above 50 a barrel and has improved from 35 in October/November. Watch oil to see what gas might do, as oil becomes more expensive, natural gas looks like a cheaper alternative. Oil above $50 implies gas above $5 .At an energy equivalent price oil above $50 implies gas above $8 (50 divided by 6) .

Conclusion: if oil stays above $50, I expect gas to be in the range of $5-$8. This is more likely in my view than gas in the 3-5 range.