Room

Despite the moderating tropical weather picture, Raymond James analyst J. Marshall Adkins said the natural gas bulls have room to roam if the BTU-parity price ratio between natural gas and oil is a valid indicator. The analyst is expecting a full-year 2006 price of $7.54/MMBtu and a full-year 2007 price of $10/MMBtu.

As the once halcyon Enron era draws to a conclusion in a Houston federal court room, 2,000 miles to the northwest at the Oregon headquarters of Portland General Electric (PGE) utility employees are rubbing their eyes and wondering if it was all real — those eight years as a subsidiary of Enron Corp.

Bumping Hurricane Rita to a Category Four hurricane on Wednesday morning and then to a Category Five Wednesday afternoon proved that there is still plenty of room to the upside for natural gas futures to explore. After setting a new all-time record high of $13.24 in the overnight Access trading session, October natural gas futures on Wednesday ended up settling at $12.594, up 10.2 cents from Tuesday, but 6.9 cents lower than the all-time high prompt-month settle of $12.663, which was set on Monday.

The Federal Energy Regulatory Commission gave regulated energy companies in the Gulf of Mexico and Gulf Coast region a little breathing room by extending any deadlines to Sept. 30 for companies affected by the hurricane who are participating in proceedings at the Commission and need an extension. FERC also is allowing companies to delay until Sept. 30 compliance with certain standards of conduct regulations, particularly reporting on each emergency that resulted in a deviation from the standards of conduct. Regulations usually require reporting of such incidents within 24 hours.

Following an extended debate and back-room deals, the Senate on Thursday approved a bipartisan amendment as part of the omnibus energy bill to provide $1 billion in coastal impact assistance funds over four years to six coastal states with oil and natural gas production on the Outer Continental Shelf (OCS).

With about a 10 Bcf withdrawal expected in this week’s storage report, working gas levels will end the withdrawal season with nearly 187 Bcf more in storage than average over the last 11 years, according to the Energy Information Administration’s data. That will mean more gas to meet summer power demand, but it probably won’t be enough to put downward pressure on prices, according to two industry experts.

Strong cash this year will give the U.S. upstream oil and natural gas sector more wiggle room to increase their capital budgets, to strengthen the bottom line and to give shareholders bigger dividends, Fitch Ratings analysts said in a new report.

Strong cash this year will give the U.S. upstream oil and natural gas sector more wiggle room to increase their capital budgets, to strengthen the bottom line and to give shareholders bigger dividends, Fitch Ratings analysts said in a new report.

UBS Warburg analyst Ronald J. Barone on Monday raised his Henry Hub gas price forecast for the year to $5.85 from $5.15/MMBtu because of continued low storage levels, deliverability issues and expected strong demand from power generators this summer. But in a separate report analyst Stephen Smith of Stephen Smith Energy Associates said the market appears to be missing the potential for some large storage injections this summer due to demand destruction. Smith sees a need for a downward correction in prices.