My weekly podcast

[dan_s]

Susan & I will be driving to Dallas tomorrow afternoon and then we will be at our Dallas luncheon on Friday. We are staying over in Dallas on Saturday to attend my daughter-in-law's baby shower. This is Clark & Stephanie's first baby, so they are going a bit "over-board" (like we all did). Stephanie is an only child, so her mother is going "ga-ga" over this baby that will arrive in April. The kid already has a full year of clothing and toys that will keep her busy for two years. Yes, it is a girl. We have two grand-daughters in Iceland. It will be nice to have one living in the country.

So..., my weekly Oil & Gas Market podcast will not be completed until Sunday afternoon. It will give me more time to review the weekly storage reports and other news.

I expect WTI to flop around in the $50-$55 range during Q1. What OPEC + Russia do will determine where oil prices go this year. If they cut production by over 1.0 million BOPD, we should see $60 oil in 6-9 months. If they cut production by over 1.5 million BOPD we have a good shot at $70 oil by year-end.

Natural gas and NGL: Near-term weather will drive gas prices
> Watch the daily long-range weather updates at: http://www.weatherbell.com/premium/
> Keep an eye on Chicago's weather forecast at: https://www.wunderground.com/

If you have been paying attention to my podcasts, you know that winter weather is only a small part of U.S. natural gas demand. Space heating is #3 on the list of demand for natural gas. Industrial demand and power plant demand are higher, but spread more evenly through the year. Demand for exports is the fastest rising part of gas demand.

Yes, last year's super warm El Nino winter reduced 2016 natural gas demand by approximately 800 Bcf. The Super El Nino is gone. Winter is coming back the last week of January and February is now forecast to be colder than normal. Anything close to a normal winter will increase demand YOY by 2.5 to 3.0 Bcf per day during the storage refill season (April to November). As I said at today's luncheon, THIS IS A BIG DEAL and will have a MAJOR IMPACT on gas prices during the second half of 2017.

This EIA report ( http://www.eia.gov/petroleum/drilling/pdf/dpr-full.pdf ) will give you a good idea of what is going on in the seven U.S. regions that produce most of our oil and gas.

I will be checking the market and the EPG Forum while we are in Dallas.