Oct Natural gas being sold bigtime

the oct speculators got crushed and it's a very good lesson on why the ng is a wicked and slippery instrument. so one could buy the dec contract ffor what $9.80. so that expires nov 26th which is before the cold season really hits. odds are very great that shorting that will nail some big profits
 
where do you guys think a worst case floor price for winter is?

I was reading that the floor price should be at lowest about $5, because at that point coal power plants will be less economical to run than NG, so the demand for NG should increase rapidly as it approaches $5?

but what do i know really...
 
Quote from jasonjm:

where do you guys think a worst case floor price for winter is?

I was reading that the floor price should be at lowest about $5, because at that point coal power plants will be less economical to run than NG, so the demand for NG should increase rapidly as it approaches $5?

but what do i know really...
More...

warm winter = 5.00
avg winter = 6.50-7.00
cold winter = 9.00-10.00

just waiting myself for those damn arbs to step in.

all trends reverse, and if you look closely in historic #s, many buying days this summer form a bell like curve over the nat gas strip. This to me suggests purely hurricane speculation.

so now I'm waiting for a 'reverse bell'.
 
just watching here...and not really an NG trader...but remembering all the stuff I read by Simmons research about well depletion etc.

the same guy who's chirping about peak oil, isn't he? peak oil and nowhere to store it...


what a coincidence: supply materializes when prices are high.
 
Quote from jasonjm:

where do you guys think a worst case floor price for winter is?

I was reading that the floor price should be at lowest about $5, because at that point coal power plants will be less economical to run than NG, so the demand for NG should increase rapidly as it approaches $5?

but what do i know really...
More...

from
http://www.apachecorp.com/Explore/E...1/Topic_Report_Impact_of_Coal_on_Natural_Gas/

Spot coal prices have become very dependent upon natural gas prices and the two fuels will continue their interplay. Despite increases in spot coal prices, long term contract coal prices averaged $1.33/MMBtu (or $26.60/ton) delivered citygate in 2004 compared to an average utility purchase price of $5.91/MMBtu for natural gas in 2004. Adjusting for plant efficiencies and using a heat rate of 10,300 for coal and 7,700 for natural gas, $6.00/MMBtu natural gas price would equate to a spot coal price of almost $90.00/ton. The current spot price for Eastern coal is $60.00/ton, making the spot price of coal more attractive than natural gas for baseload power generation.


Then:
http://www.eia.doe.gov/cneaf/coal/page/coalnews/coalmar.html#spot

I forget how much transportation is, but lets say avg price delivered is $40-$50 (thats why central appalachia coal may be more expensive, as its proximity to power plants and demand is very good), then break even is $3.00 for natural gas. Of course, if avg delivered price went back down to 2004 levels, then breakeven would be closer to $2.00 on natural gas. So its all relative.

There is plenty downward room on nat. gas still. On the other hand, most people don't heat their homes with coal (directly).
 
Quote from jasonjm:

wow.....

some heavy duty selling this week

but nov and dec contracts dont seem to be that willing to give up as much....

I am definitely underwater on my positions now

where be the bottom lol
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Can you please explain to me what it means by your saying:

"Oct Natural gas being sold bigtime "

If you or someone else won't mind taking the time to explain to me as I just know about buying and then selling a stock.
 
Quote from e-miNY:

Spread at 4.02 for Dec now. WoW! Just 50 days left in the contract. 4.02 for 50 days storage. Sure it is out of line, but not sure why arbitrager are not stepping in. Record storage, maybe no capacity at all to take advantage of the 4.02.
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I noticed the same thing and just shook my head.

Wow.
 
Quote from scriabinop23:

from
http://www.apachecorp.com/Explore/E...1/Topic_Report_Impact_of_Coal_on_Natural_Gas/

Spot coal prices have become very dependent upon natural gas prices and the two fuels will continue their interplay. Despite increases in spot coal prices, long term contract coal prices averaged $1.33/MMBtu (or $26.60/ton) delivered citygate in 2004 compared to an average utility purchase price of $5.91/MMBtu for natural gas in 2004. Adjusting for plant efficiencies and using a heat rate of 10,300 for coal and 7,700 for natural gas, $6.00/MMBtu natural gas price would equate to a spot coal price of almost $90.00/ton. The current spot price for Eastern coal is $60.00/ton, making the spot price of coal more attractive than natural gas for baseload power generation.


Then:
http://www.eia.doe.gov/cneaf/coal/page/coalnews/coalmar.html#spot

I forget how much transportation is, but lets say avg price delivered is $40-$50 (thats why central appalachia coal may be more expensive, as its proximity to power plants and demand is very good), then break even is $3.00 for natural gas. Of course, if avg delivered price went back down to 2004 levels, then breakeven would be closer to $2.00 on natural gas. So its all relative.

There is plenty downward room on nat. gas still. On the other hand, most people don't heat their homes with coal (directly).
More...

Don't forget about crude. High oil prices help keep natural gas high. If crude collapses...look out below.
 
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