Natural gas companies watched their stocks tumble earlier this year with the price of nat gas, but some share prices have successfully reversed course.
Now natural gas prices, which have recently bounced around the $2.80 level after hitting a ten-year low in April, may be ready for another move up.
The fall in prices - from a high of $10.38 per million British thermal units (BTUs) in July 2008 to just $1.83 in April of this year - was primarily the result of a decade-long increase in U.S. gas production, which climbed by 21.6% from 2002 to 2011.
Now inventories are growing much slower and demand is increasing as electric utilities switch to natural gas from the more expensive coal. Other potential catalysts such as the weather, e.g. Hurricanes Debby and Isaac, could also send prices higher.
Natural gas prices rose more than 6% in the past week to $2.85 per million BTUs.
A rise in prices though doesn't guarantee a rise in all natural gas stocks, as there's a lot more than a price reversal happening in the industry.
For investors interested in natural gas companies, here's this week's wrap-up of what you need to know:
DTE Energy Co. (NSYE: DTE), Enbridge Inc. (NSYE: ENB), and Spectra Energy Corp. (NYSE: SE) announced plans for a 250-mile natural gas pipeline that would originate in northeastern Ohio, follow existing utility passages across the state and connect with an existing line in Michigan. The proposed pipeline needs the approval of the Federal Energy Regulatory Commission and could be in service by November 2015.
In a statement, the EU's antitrust agency said Gazprom's behavior may lead to higher prices, harm Europe's security of supply and hurt EU consumers. Dmitry Peskov, a spokesman for Russian President Vladimir Putin, was surprised by the news of the investigation. "It's not clear why this suddenly has become a subject for investigation," Peskov said by telephone Wednesday. "Why is there this assertion of a violation of the security of supplies? Because Gazprom was, is and will be a reliable supplier of natural gas to its customers."
The memo came in response to a motion filed by BP last month for the court to approve its settlement with gulf fishermen and other private sector victims of the spill, which the company has estimated will cost it $7.8 billion. The DOJ has stated that it is too early to estimate the total amount of damage done to the Gulf. The memo also accuses Transocean LTD (NSYE: RIG), owner and operator of the Deepwater Horizon rig, of gross negligence for its role in having "stunningly, blindingly botched" a key test of whether the well had been properly sealed. A trial of the civil case over penalties and damages has been set for January 14, 2013. No criminal charges relating to the causes of the spill have been filed.
Related Articles and News:
[epom]