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Cold comfort: natural gas glut vaporizes

January 21, 2011

Buried in yesterday’s news cycle (and Northeastern snowbanks), Rocky noticed that the widely reported “glut” of domestic natural gas inventories suddenly vaporized. Or more accurately, it oxidized.

The Department of Energy reported yesterday  that Eastern US natural gas inventories are now BELOW their five-year average, and national inventories are in-line with their five-year average. See: http://ir.eia.gov/ngs/ngs.html

Rocky believes that  inventories remain ample. However, a  few more weeks of arctic cold weather, and natural gas consumers will feel the same chill that heating oil consumers have been experiencing. 

[Disclosure:   Rocky never gives investment advice, but he thinks natural gas is “cheap” compared to crude oil.  But that doesn’t mean the natural gas price will go up or the crude oil price will go down…. For details, see Rocky’s Definitions at the top of this page under Rocky I and Rocky V. ]

  1. fatbear
    January 21, 2011 at 2:05 pm

    Yes, the 6:1 $ ratio Oil/NG has been broken for some time. As the immutable laws of energy give us that 6:1 BTU ratio, one wonders if the price of NG is too low or that of Oil too high…. And the glut will return now that Cuomo and other NE governors have thrown in the towel on fracking.

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