FTAlphaville: China gets …
China gets some can-kicking practice http://t.co/LQEtcKnF
EconBizFin: Of 300 big Po…
Of 300 big Ponzi schemes in America, with combined losses for investors of $23 billion, half were affinity-based http://t.co/iGN6KU7L
nicholasdunbar: Goldman s…
Goldman swap shows Greece was Europe's subprime nation. http://t.co/nmbwt3rT
EconBizFin: Some $130 bil…
Some $130 billion has been ploughed into #India's power industry in the past five years http://t.co/yrhI4Aq1
djfxtrader: Register for …
Register for a free Dow Jones Webinar, “Forex Regulation – What’s In Store”. http://t.co/6SZ1MHpi
ProSyn: Most commented on…
Most commented on our site: "The Perils of 2012" by Joseph Stiglitz (@joestiglitz). Join the discussion: http://t.co/9CL8bmpN.
ZipperTheory: this almost…
this almost made me spit out my lunch i laughed so hard http://t.co/duvXE8j3 h/t @LemaSabachthani
LukasSustala: Breaking Do…
Breaking Down Google’s Earnings by Industry (2011), nice chart. http://t.co/Y2NG0Df9 #google #advertising
ezraklein: Must-read NYT …
Must-read NYT article on why Apple doesn't produce iPhones in the US: http://t.co/84NSzdCH
groditi: Sov defaults are…
Sov defaults are always political, not economic events. Get it through your heads. Distribution of loss matters more than size of loss
EconBizFin: Entrepreneurs…
Entrepreneurs appeal to our anti-establishment instincts--emotions that lead us to dislike chief executives and bankers http://t.co/rfjaLetU
GSElevator: I actually wr…
I actually wrote this story... for the kids... http://t.co/OUfq7fz8
longreads: Announcing: Ou…
Announcing: Our first-ever ebook! "Longreads: Best of 2011" is now available, and includes 7 of our favorite stories http://t.co/EX8Z4dvT
bondvigilantes: New post:…
New post: The hot money has flown south to Australia for the winter, but will it fly back in the summer? http://t.co/AApbHETp
Oil to Natural Gas Ratio 1990 to 2012
Natural gas is trading at 2 handle last checked at $2.67BTU even as crude nearing $100.What is historic relationship between crude oil and natural gas? I pulled some data from Reuters, both are Nymex front month future contract from 1990 onwards. Crude oil data goes to 1986, but Natural Gas only started in 1990.
Interestingly the relationship between oil and gas since 1990 after the initial spike traded between 5 and 15 from 1992 to 2009. Then it has been on a bull run to just under 40 right now. The current ratio is the highest in 20 years, and this can be largely attributed to the Shale Gas boom underway in the US. Presenting the data in this way, it highlights the impact of the shale gas flooding onto the continental market impact on the price.
Due to infrastructure constraints and historical reluctance to export natural gas, all the gas pumped out of the earth have to be consumed domestically. Even with LNG prices in the teens in Europe and high single digit in Asia, the largest growth market there is little means for US producers to take advantage of the situation. One means of consuming the excess supply could be increase the use of natural gas in base load power.
Bullish case for Natural Gas?
In the short term, even with the warmer than expected winter period which has limited natural gas on the upside. Given the seasonal reduction in the natural gas inventories in the short term, along with the predictable decrease in production from high cost producers, as most shale gas drilled recently were attributed to control lease agreement’s use or lose it clause. The downside seems limited from here.
In the medium term, the opening of the exports from the construction of LNG export terminals which the US has evidently lacked will ensure that it can arbitrage the high prices seen around the world. The low cost production in the US allows us to compete from a lower cost base than Australia LNG trains in Aisa. Since gas is cleaner than coal, with China over reliance on coal with the negative externalities, it would be attractive for US producers to push towards this market than any other. However other emerging markets are ripe for the picking, better late than never.
Domestically, the decline in conventional gas production and its replacement with shale gas will maintain the current strong production flow levels. This will ensure that prices will remain lower than historic levels and attractive for power generators to convert and build natural gas plans relative to other sources. However this is predicated upon a constructive regulatory environment to encourage such developments. With the current election year and controversy over fracking extraction method, I would not expect any positive developments in this area until after the 2012 election. Then with a 2 -3 years lead time for planning and construction.
EconBizFin: Provisional e…
Provisional estimates suggest that #Japan’s merchandise trade moved into the red in 2011—its first annual deficit http://t.co/CEHoO1uI
RT @Fullcarry: US Dollar …
RT @Fullcarry: US Dollar is up 9.5% since S&P downgraded the US.
Uldis_Zelmenis: $EURUSD-d…
$EURUSD-doom by one of best $EURUSD forecasters in Bloomberg surveys http://t.co/PtbCWzEI by Nordea
Markit: Sign up for our d…
Sign up for our daily data and commentary here: http://t.co/ncr58gU7
“@FinancialTimes: Apple…
“@FinancialTimes: Apple aborts China debut of iPhone 4S http://t.co/RLMJFy8F #FinancialTimes”
LET THEM EAT APPs
#iphone4s $apple
Recent drop in China rese…
Recent drop in China reserves: nothing goes up forever, previous level of increase was unsustainable. Now the question is where's the floor
@HelenHChan touché…
@HelenHChan touché
@LongShortTrader @helenhc…
@LongShortTrader @helenhchan
It better have SOE's on that list or it will be another pr flak. I wouldn't hold my breath.
BarbarianCap: How is that…
How is that for transparency? Trader posts tax returns http://t.co/ydeRY5Ab
