Winter 2015
Templeton Financial Group
NATURAL GAS
5300 West Atlantic Ave Suite 612 Delray Beach, FL 33484 866-413-2974
Supply U.S. energy companies are taking their foot off the natural-gas pedal, slowing down their production growth after years of furious pumping. In the past eight years , a combination of improvements in drilling techniques and high energy prices stoked naturalgas production to all-time highs. The boom quickly sent natural-gas prices to historic lows, but output kept rising because high oil prices made it profitable for producers to keep tapping fields that yielded both oil and gas.
Now, the global collapse in oil prices has producers and analysts rethinking the gas boom, too. Both gas and oil prices are down about 40% in the past year, cutting the incentive to keep drilling. A flurry of recent forecasts from government and private-sector experts suggest monthly gas production will flatten and possibly even begin to decline in 2015.
FUTURES AND OPTIONS TRADING INVOLVE SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. OPTIONS, CASH AND FUTURES MARKETS ARE SEPARATE AND DISTINCT AND DO NOT NECESSARILY RESPOND IN THE SAME WAY TO SIMILAR MARKETS STIMULUS. A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES & OPTIONS CONTRACT BEING OFFERED. SEASONAL DEMAND AND CURRENT NEWS IN COMMODITIES ARE ALREADY REFLECTED IN THE PRICE OF THE UNDERLYING FUTURES. [1]
DEMAND
As of this writing EIA's forecast of U.S. online, particularly in the fertilizer and t o t a l n a t u r a l g a s c o n s u m p t i o n chemicals sectors, and as industrial averages 76.7 Bcf per day (Bcf/d) in consumers continue to take advantage 2 0 1 5 a n d 7 6 . 6 B c f / d i n 2 0 1 6 , of low natural gas prices. Consumption compared with 73.5 Bcf/d in 2014. of natural gas in the residential and Consumption growth in 2015 is largely commercial sectors is projected to driven by demand in the industrial and decline in 2015 and 2016. electric power sectors. EIA projects natural gas consumption in the power sector to grow by 13.7% in 2015 and then fall by 2.7% in 2016. Low natural gas prices support increased use of natural gas for electricity generation in 2015. Industrial sector consumption increases by 3.6% in both 2015 and 2016, as new industrial projects come
FUTURES AND OPTIONS TRADING INVOLVE SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. OPTIONS, CASH AND FUTURES MARKETS ARE SEPARATE AND DISTINCT AND DO NOT NECESSARILY RESPOND IN THE SAME WAY TO SIMILAR MARKETS STIMULUS. A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES & OPTIONS CONTRACT BEING OFFERED. SEASONAL DEMAND AND CURRENT NEWS IN COMMODITIES ARE ALREADY REFLECTED IN THE PRICE OF THE UNDERLYING FUTURES.
[2]
In the opinion of Templeton tropical storm in the Gulf of Mexico at Financial Group, many factors can what could be considered an early affect the price of natural gas, and start to a possible hurricane season. can come at very unpredictable Now, no one knows the outcome of times. Whether it is a pipeline this season and the known market
GLOBAL MISHAPS
explosion that can cause a temporary event of this storm is factored in disruption in the market place. Or a immediately. The question is what will hurricane in the Gulf of Mexico that be the impact of the next one, should shuts down oil and gas rigs in some we have one? cases for sustained amounts of time. Summer hot and stormy weather, Even military action that potentially or winter frigid weather can have an causes world oil prices to move immediate and/or lasting impact on higher , which could make natural gas prices, but timing is crucial in more attractive to use for running attempting to forecast future market turbines to generate electricity by direction, so only risk capital should u t i l i t y c o m p a n i e s . A n y m a j o r be used in trading commodity futures d i s r u p t i o n , c a n c a u s e v o l a t i l e and options. movements in short periods of time. At the time of this writing there is a
FUTURES AND OPTIONS TRADING INVOLVE SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. OPTIONS, CASH AND FUTURES MARKETS ARE SEPARATE AND DISTINCT AND DO NOT NECESSARILY RESPOND IN THE SAME WAY TO SIMILAR MARKETS STIMULUS. A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES & OPTIONS CONTRACT BEING OFFERED. SEASONAL DEMAND AND CURRENT NEWS IN COMMODITIES ARE ALREADY REFLECTED IN THE PRICE OF THE UNDERLYING FUTURES.
[3]
NATURAL GAS
2015
References http://www.wsj.com/articles/energy-industry-is-gassingdown-1434410757 http://www.eia.gov/forecasts/steo/report/natgas.cfm http://abcnews.go.com/US/wireStory/latest-texas-bracestropical-storm-bill-approaches-31792671 http://www.wsj.com/articles/natural-gas-boosted-by-hotstormy-weather-1434376953?KEYWORDS=natural+gas+boosted +by+hot+stormy+weather
TEMPLETON FINANCIAL GROUP 5300 West Atlantic Ave Suite 612 Delray Beach, FL 33484
O 866-413-2974 L 561-499-9889 F 561-499-4018
Member of
templetonfg.com
Registered IB of
FUTURES AND OPTIONS TRADING INVOLVE SIGNIFICANT RISK OF LOSS AND MAY NOT BE SUITABLE FOR EVERYONE. OPTIONS, CASH AND FUTURES MARKETS ARE SEPARATE AND DISTINCT AND DO NOT NECESSARILY RESPOND IN THE SAME WAY TO SIMILAR MARKETS STIMULUS. A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES & OPTIONS CONTRACT BEING OFFERED. SEASONAL DEMAND AND CURRENT NEWS IN COMMODITIES ARE ALREADY REFLECTED IN THE PRICE OF THE UNDERLYING FUTURES. [4]