Natural Gas Price Forecast by RJ - Sept 26
Posted: Mon Sep 26, 2022 5:53 pm
Note from Raymond James
Energy Stat: Defending a Bullish Stance on '23 U.S. Natural Gas Prices After the Recent Sell-off, $7 Still in Play
As the summer season winds down in the Northern Hemisphere, what is going on in the U.S.
natural gas markets is completely a matter of perspective. On one hand, prices are much
higher than historical norms in the >$7/MMBtu range today and European natural gas is
trading at >3x Brent crude oil. On the other hand, the past week or two has seen more than a
~10% correction in the front month. We’re defending our bullish stance amid the selloff and
taking the "over" on 2023 U.S. prices.
Today's Stat addresses:
1. Updated views surrounding gas-to-coal switching;
2. Updated views on U.S. supply, including takeaway constraints in major producing
regions (a few of these constraints are dissipating);
3. The outlook for LNG exports, including the recent delay of the Freeport LNG restart; and
4. Our updated aggregate supply/demand and price forecasts, including a scenario
analysis around the perennial “WWW” – winter weather wildcard. We finish with stocks
to play the natural gas theme.
Energy Stat: Defending a Bullish Stance on '23 U.S. Natural Gas Prices After the Recent Sell-off, $7 Still in Play
As the summer season winds down in the Northern Hemisphere, what is going on in the U.S.
natural gas markets is completely a matter of perspective. On one hand, prices are much
higher than historical norms in the >$7/MMBtu range today and European natural gas is
trading at >3x Brent crude oil. On the other hand, the past week or two has seen more than a
~10% correction in the front month. We’re defending our bullish stance amid the selloff and
taking the "over" on 2023 U.S. prices.
Today's Stat addresses:
1. Updated views surrounding gas-to-coal switching;
2. Updated views on U.S. supply, including takeaway constraints in major producing
regions (a few of these constraints are dissipating);
3. The outlook for LNG exports, including the recent delay of the Freeport LNG restart; and
4. Our updated aggregate supply/demand and price forecasts, including a scenario
analysis around the perennial “WWW” – winter weather wildcard. We finish with stocks
to play the natural gas theme.