Indicators

Despite early indicators of an economic turnaround and signs that energy demand is showing signs of a rebound, Canada should have adequate supplies of heating oil, natural gas and electricity to make it comfortably through the 2009-2010 winter, according to the National Energy Board (NEB) in its annual Winter Outlook.

As one of two indicators that natural gas for transportation is still alive and well in California despite a ballot measure defeat last month, T. Boone Pickens’ gas-powered transportation company, Clean Energy Fuels Corp., said last Monday it has won a 10-year contract with the City of Glendale, CA, to build and operate a new large-scale public access compressed natural gas (CNG) fueling facility to support the city’s expanding CNG-powered vehicle fleets. The following day Sempra Energy and local officials kicked off a switch to CNG-powered cargo trucks in Southern California’s two teeming ports.

Bearish indicators for oil prices and robust natural gas production inform a lower 2008-2010 gas price outlook held by Stephen Smith Energy Associates. For this year the group is forecasting a $9.30/MMBtu average Henry Hub price, down from a previous estimate of $9.47/MMBtu.

Bearish indicators for oil prices and robust natural gas production inform a lower 2008-2010 gas price outlook held by Stephen Smith Energy Associates. For this year the group is forecasting a $9.30/MMBtu average Henry Hub price, down from a previous estimate of $9.47/MMBtu.

Several indicators in January pointed to a pullback in 2007 natural gas drilling levels, which drove some prognosticators to reduce their drilling activity forecast and lower their expectations. However, the late arrival of cold weather has since driven gas prices higher, and rig permits have begun to rebound, leading Raymond James & Associates to conclude there will be an uptick in drilling activity by midyear that will carry well into 2008.

Several indicators in January pointed to a pullback in 2007 natural gas drilling levels, which drove some prognosticators to reduce their drilling activity forecast and lower their expectations. However, the late arrival of cold weather has since driven gas prices higher, and rig permits have begun to rebound, leading Raymond James & Associates to conclude there will be an uptick in drilling activity by midyear that will carry well into 2008.

As the mild winter continues to wind down, the natural gas industry — in looking for the next gas price indicators — will soon change focus to the summer cooling season and the Atlantic hurricane season.

As the mild winter continues to wind down, the natural gas industry — in looking for the next gas price indicators — will soon change focus to the summer cooling season and the Atlantic hurricane season.

As the winter heating season winds to a close, the natural gas industry is now looking towards the summer cooling season and the Atlantic hurricane season for indicators on the direction of natural gas prices. Special attention is being paid to the 2006 Atlantic hurricane season, which forecasters expect to be overly active. Focus on the hurricane season is even greater as Gulf of Mexico oil and gas producers continue to pick up the pieces six months after Hurricane Katrina’s devastation.