BrotherMaynard

Plenty of Natural Gas: Exploration and Production Companies Keep Increasing Oversupply

excellent point about shut-in storage -- it should be considered inventory. the future supply problem b/c of lower rig counts is overblown. that's why curve flattening should be the next stage of this cycle.

just to expand on the EOG comment, stephen schork today:

"several Northeast pipelines started issuing operational flow orders (OFOs) in an apparent attempt to limit shippers exceeding their contractual limits...In addition to the Labor Day holiday, last week’s report also comprised the ratchet clause rollover. Injection ratchet clauses in the East require shippers to inject working gas through scheduled stages in order to preserve operational integrity. By September 01st no more than 80% of storage can be filled....According to the latest estimate from the EIA, maximum storage capacity in the East is 2.178 Tcf. As of two reports ago, week ended August 28th, estimated storage was 1.78 Tcf. That calculation was already 81½% of capacity or 1½ points above the ratchet. In other words, storage in the East over the last two reports was at operational capacity. Thus, the OFOs were a likely means to hold storage below the 80% threshold...What’s so bullish about that? Absolutely nothing."


here's the rest of schorks note: www.cnbc.com/id/327973...

Natural Gas: Could This Be the First Bullish Chart?

"Guy Adami of fast money who is very savvy said UNG is aplay here"

in all of his savviness did he bother to mention that ung is trading at a 15% premium to NAV?

That's in addition to the fact that ung owners are already are paying a negative roll yield (fyi...12 month nat futures spread is almost a 1 bagger...finance.yahoo.com/q/fc...).

ung is a mess - it almost reminds me of that guy at the end of robocop 1 that crawls out of the cesspool only to be made instant road kill by that speeding paddy wagon.

see more here: ftalphaville.ft.com/bl.../