Posted on 08/22/2022 11:00:51 AM PDT by BeauBo
Agree in general but I think it will take longer to replace. Doesn’t matter, the time period is part guesswork right now but will become much easier to judge as time goes on. And Russia will be allowed to export again at some point.
WTI crude is down to a little over $90. It’s late summer, and gasoline prices are down. Not bad so far. We’ll see. I’m guessing that Europe will get through winter okay.
Yes, very good sound. Played a gig recently with a guitarist that I hadn’t played with in about a year. He works with several acts. I plugged in, hit a few notes and he said, “God I love your tone”.
Natgas price in the US approx. $9.50-$10/dth. Price in Germany approx. $72/dth.
when the natural gas terminal on the gulf reopens—US natural gas prices will trend toward world levels. (and likely with more US supply on the market —world levels will decline.)
But it does look very much like US natural gas prices can double or triple from here.
Henry Hub piped natgas gas is at 9.20 per mmBtu. TTF Netherlands LNG is at 74.00 per mmBtu for December futures.
“I’m figuring US natural gas prices will double or triple from roughly 10 per mmBtu to $25-30 per mmBTU by December.”
How do you figure?
“Your bill will go from 105 bucks a month last year [just for the Cost of Gas] to 270 bucks a month.”
So you figure nearly a triple from here.
Correct?
I didn't figure this.
A jump to 15 bucks per mmBtu in the US domestic market would have politicians decorating trees and lamp posts.
“Your bill will go from 105 bucks a month last year [just for the Cost of Gas] to 270 bucks a month.”
I did figure this. As it stands now, that what your bill would look like.
I figure more price rises in the coming months. I think that historically, 1.20 a therm [around 12 bucks a mmBtu] is a lot.
https://finance.yahoo.com/finance/news/saudi-arabia-hints-opec-may-195245349.html
The Kingdom may be saying Nay on oil production [today].
On Kudlow US @$9+/MMBtu and Germany @$90/MMBtu.
Last year at this time the price was $3.26/MMBtu. That is close to a 300% increase. How people can vote for poverty is beyond me. Don't know who the lower echelon of people are going to manage. Hopefully, no hurricanes in the next two months.
Oof, and bring the pain!
“NOTE THAT - before Feb. 23rd, 2022”
Note that the above time period is 21 years. During that time, yes, Russia wanted peace, but so did the Neocons, but on terms that Russia was not about to sign up to.
...so here we are.
“Agree in general but I think it will take longer to replace.”
The consensus among analysts also seems to be that it will take longer to replace that total volume of production (Russia had been exporting almost 200 billion cubic meters per year).
I think the futures are factoring in some demand pullback globally from recession, to get to market price stabilization in mid 2024. Central Banks in many major countries have been slamming the brakes hard with interest rate hikes and tighter money (US, EU, Japan and Korea).
“Russia will be allowed to export again at some point.”
That will probably snap back much quicker in the oil market, rather than for gas.
It now seems firmly entrenched National Security policy that Russian energy dependence must be limited to no more than they can afford to quickly replace - more like 10%, than the previous 40% of supply.
A good bit of their gas export market, tied to fixed pipeline infrastructure, may well be gone for good. (85% went to the EU (including Turkey) last year). More than half of that is likely gone for good. New pipelines to alternate customers (like India and China) would have to cross time zones - thousands of miles.
I am hoping that with the price of gas up, producers who shut down when prices were low will reopen their assets to produce more. Then, of course, prices may move down again.
I am hoping that with the price of gas up, producers who shut down when prices were low will reopen their assets to produce more
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When electrically dependent manufacturers like aluminum shut their doors, it means they are out of business. They are not going to make anything ever. They are done.
When that happens other things don’t happen - for example: the aluminum company that shut was one of only 2-3 that make military grade aluminum for new navy ships.
That means the Navy has to go elsewhere and negotiate a new contract which will likely cost more, making the ship cost more.
That means other things the Navy would buy, they cannot afford. That means in will be a year or more before they can afford they hing they need.
That mean the US Navy is now weaker.
NG prices are NOT going to go down, at least until after the current energy policies based on “climate change” go away. Current policies are aimed at doing away with NG.
The cheap alternative is coal, but that is being phased out because its part of the policy of eliminating ‘dirty’ fossil fuels.
Expand that example above across all other industries and eventually there will not be any. The West will have effectively de-industrialized, and as a consequence of that, millions and millions will die, and the counties effected will become ungovernable, except by brute force.
The recent "Inflation Reduction Act" adds new taxes on NG that begin in 2024, and increase in 2025 and 2026.
The recent “Inflation Reduction Act” adds new taxes on NG that begin in 2024, and increase in 2025 and 2026.
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See and that’s just a tax, not the ever increasing market price because of the misguided ‘green’ war on fossil fuels.
Just wait until next year and the year after that - how high will the tax be then?
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