Adequate

Although natural gas storage levels remain adequate, high crude oil prices, a continued strong economy and the expectation that Pacific Northwest hydroelectric resources will be well below normal through mid-summer are the principal reasons the Energy Information Administration (EIA) sharply raised its gas price forecasts in its April Short Term Energy Outlook.

Although natural gas storage levels remain adequate, high crude oil prices, a continued strong economy and the expectation that Pacific Northwest hydroelectric resources will be well below normal through mid-summer are the principal reasons the Energy Information Administration (EIA) raised its gas price forecasts in its April Short Term Energy Outlook.

High oil prices, political hype, lack of adequate market information on either the supply or demand side and “bullish” media influence are among the key factors that have been propping up the price of natural gas, which is headed for a fall, according to a newly-issued report by two leading energy analysts.

High oil prices, political hype, lack of adequate market information on either the supply or demand side and “bullish” media influence are among the key factors that have been propping up the price of natural gas, which is headed for a sharp fall, according to a newly-issued report by two leading energy analysts.

The lack of adequate transmission infrastructure and a policy environment that has a stop-and-start quality to it, including the federal wind power production tax credit (PTC) that was recently extended through December 2005, are key hurdles to the further development of wind power in the U.S., participants at a FERC-sponsored technical conference said last week.

While the gas futures market was on the decline for much of last week and working gas levels in storage moved back above five-year averages, prognosticators at investment banking firm Raymond James & Associates are betting the gas storage situation isn’t nearly as rosy as it seems, and tight supply will end up pushing gas prices back above $8/MMBtu in the next few months.

While July gas futures tumbled sharply Monday morning with a low at $6.15, prognosticators at investment banking firm Raymond James & Associates are betting the gas storage situation isn’t nearly as rosy as it seems, and tight supply will end up pushing gas prices back above $8/MMBtu in the next few months.

Saying FERC failed to provide an “adequate explanation” for its action, a federal appeals court in Washington, DC on Friday vacated a 2002 order in which the agency rejected Williston Basin Interstate Pipeline’s practice of selective discounting of transportation rates on its system.

Expectations for adequate natural gas storage supplies and the approaching seasonal drop in crude demand will likely lead to a decline in both commodities and the exploration and production (E&P) stocks in the near term, but the outlook long term remains positive, according to analysts with RBC Capital Markets.