Dan Brockway

Natural Gas Prices Set To Surge - Canaccord

The price of natural gas is headed down. Production has risen 8-12% in the past year depending on what numbers you believe. At the same time there is some demand destruction due to the higher prices we have seen up until the last month or so. Natural gas drilling will continue at its rapid pace until gas goes below $6.00 at which point some of the new plays will start to look less attractive. With rising production I see little that will drive up the price of natural gas. The conversion to vehicles fuel as Boone Pickens suggests will take several years if it ever happens. So for the next year or two I see gas prices in the $6-8 range.