Wt Natural Gas Discussion Threads

[ferrism] 25/3/2011 09:42

By the way, the fall yesterday was caused by the EIA statistics (see my link above.) They showed that, after two of the worst winters recorded, the gas in storage is still above the 5 year average.

[ferrism] 25/3/2011 08:17

I'm afraid you're stuck with trading Henry Hub based prices which, for all the reasons I've given in this BB, is considerably lower than UK or the rest of the world. If you want to trade UK gas prices I guess the most convenient way is to buy BG. which has performed quite well over the last few years.

[beeks of arabia] 24/3/2011 21:17

If gas gets any cheaper i'm gonna fill my garage with it, ready for when the prices go back up.

[eric gardener] 24/3/2011 20:52

well untill earlier today I thought I was trading on gas prices - I ask my self how I may have known the gas I am buying isn't the gas I have roasted my chicken with.

nothing is ever easy is it?

I see this silly wtf etf has dropped like a stone this afternoon. Hope it goes to 0 stupid etf.

[chopsy] 24/3/2011 18:44

Good question Eric, how do we trade on UK gas prices?

[ferrism] 24/3/2011 14:37

Well those EIA stats were bad, weren't they!

[eric gardener] 24/3/2011 13:50

loads of buys on the screen, more people pilling in!

[brando69] 24/3/2011 13:45

THIS IS LESS ETF AND MORE WTF

[eric gardener] 24/3/2011 13:43

cheers ferris,

well my mind does boggle somewhat, if this isn't gas as in 'gas' then what is the etf for the gas we use in the uk?

[brando69] 23/3/2011 20:23

on a happier note, i'm almost back at breakeven

[ferrism] 22/3/2011 23:01

Welcome to the great conundrum Mr Gardener. The simple answer to your question about your gas bill is that it may as well be a totally different product from another planet. Maybe you have assumed, exactly as I did, that Natural Gas had an international market just like oil. It would seem logical. After all, gas is gas. Unfortunately that's not how it works. The ETF we're looking at here represents North American Natural Gas. The bad news is that there is so much gas and so little demand in the US that the price looks set to be depressed for years. It isn't the sort of product that you can just start exporting at the drop of a hat. There are plans to export from the U.S. but, realistically, it's not going to happen for three or four years. As far as I know there still hasn't been approval for one export terminal. It's crazy that the terminals built for importing LNG a few years ago have hardly been used but the logistics of converting them to export are not straightforward.
Long term I'm sure you are right. As you say, minimum 18 months and possibly much more. Let's hope we can hold on that long but I fear contango will dash that hope.
As for the conspiracy theory, the oil and coal lobbies in the U.S. are much much stronger than the gas lobby. The only light at the end of the tunnel is the possibility that Nuclear energy could now become politically unacceptable but that is also a long way off.

[eric gardener] 22/3/2011 19:49

Jeeze if it's that cheap and abundant then why don't we all runs cars on it? Or is there some consipacy to keep everyone burning oil in it's various forms.

Several months ago I went long - not a large position and at one point being about 20% down there was a bit of head scratching, but bearing in mind it's my firm belief that this will one day have it's day sooner or later, possibly sooner.
could this be the start of the turn? lets hope so.

Why the hell is my gas bill so high if this stuff is so dirt cheap?

It's surely simply a matter of time when the trend changes imo it'll last an absolute minimum of 18 months possibly much more.

[protean] 20/3/2011 16:52

"Mark Lewis, head of energy research at Deutsche Bank, says: "The obvious beneficiary of all of this is gas. If you want to build new power stations with relatively low emissions, the advantage of gas is that it's much cleaner than coal, you can build it within three years, and it is ideal to build in conjunction with renewable capacity."

Gas works well as a back-up for alternative fuels such as wind or solar, because its output can be altered quickly as levels of renewable output change.

Liquefied natural gas prices shot up 15pc to peak on Wednesday, dropping back slightly by the end of the week."

[chopsy] 19/3/2011 13:34

Interesting read... explains the bounce

Natural Gas, Coal ETFs Boosted By Prospects Of Japan's Move To Replace Nuclear Power Plants
By Murray Coleman

Natural gas and coal ETFs are getting a boost today (March 17) after reports are circulating that Japan's recovery will create stronger demand for both in world markets.
The U.S. Natural Gas Fund (UNG) is up 5.4% while the Market Vectors Coal ETF (KOL) is ahead by 2.3%.
Japan is the world's largest importer of thermal coal. As it rebuilds, the country is likely to replace nuclear plants with other types of energy generating facilities, chiefly thermal coal and liquefied natural gas. "Japan will use a combination of oil, coal and LNG for power generation," Didier Hussein, director of energy markets at the International Energy Agency in Paris, told the Financial Times.
As the country moves closer to rebuilding its infrastructure, Japan's "coal-fired plants will be run harder," the report observes.
That could push prices higher and impact countries like Germany, which is temporarily halting production at several of its nuclear facilities. Smaller producers without sufficient reserves and capital could find themselves at a competitive disadvantage, a special report issued by Moody's found.

[ferrism] 15/3/2011 16:33

It would be nice to think so but I suspect it's just a bit of positioning after the disaster in Japan. Some will think that the nuclear reactor problems will result in increased use of NG. Those who really understand will shortly realise we are dealing with a purely local (US) commodity which cannot be exported at present. Any opportunity to make this a global commodity is years away, in my opinion.

[brando69] 15/3/2011 15:53

is this the start of the reversal perhaps?

[ferrism] 08/3/2011 19:24

Don't look now, traderabc, but it's going back down again.
Last time I looked the COT report showed increased shorts on gas so I think any bounce is some way off.

[traderabc] 08/3/2011 10:52

It has to go up now ferrism, once all the punters like myself have been forced to capitulate, the price can go no other way.
I hear JP Morgue have increased their silver short a lot recently, perhaps the precious metals market is the next to be reaped and played. They've already done their work here, ngas ought to bounce in a big way, sans moi of course.

[ferrism] 07/3/2011 23:01

Is it my imagination or is NG going up? Something seriously wrong going on here.

[ferrism] 07/3/2011 17:32

.... and there's always that last faint chance ....

[ferrism] 07/3/2011 08:17

Well, we did see a bounce but it certainly didn't last long. I hope you find somewhere less painful to trade, traderabc. Good luck.

[brando69] 04/3/2011 10:40

cheers chopsy

i'm only in here in a very small way - was a bit of leftover ISA money - 800 quid in fact - so currently down around 160 quid!

[chopsy] 04/3/2011 10:39

That's not a little bounce that's a major wave!

You'll have to have the guts to call the bottom right (?.25), then average down in a big way and exit at, say .29, to save your bacon. Or cut your losses. I don't envy your position here.

Best of luck, whatever you decide.