Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • Angel Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
Login My Member Benefits Archives Research Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • Angel Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    ×
  • Subscribe
Enter stock ticker or keyword
×
5 Ways to Beat the Fed (and Crush Inflation)

Email this Article

Send with mail | ahoo instead.
Required Needs to be a valid email
Required Needs to be a valid email
The Irresistible Future of Natural Gas Investing
http://mney.co/1d1khzD
Required Please enter the correct value.
Twitter

The Irresistible Future of Natural Gas Investing

By Dr. Kent Moors, Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI • April 10, 2014

Start the conversation

Comment on This Story Click here to cancel reply.

Or to contact Money Morning Customer Service, click here.

Your email address will not be published. Required fields are marked *

Some HTML is OK

Dr. Kent MoorsDr. Kent Moors

Today, I'm flying back from Houston... again.

It seems I've been spending quite a bit of time in Texas these days - and for good reason. The rollout of our exciting 25-well oil and natural gas investing project is just one.

But another revolves around the tremendous changes in the industry itself, especially when it comes to natural gas.

In fact, I just presented the keynote address before the annual meeting of the Gas Compressor Association at the Moody Gardens Convention Center in Galveston.

It dealt with the inescapable and irresistible future of natural gas.

Here's what I told those assembled about the new, "gas-driven" world...

Natural Gas: The Emergence of an Unstoppable Trend

My key point was simple: We are witnessing the rapid emergence of a global natural gas market.

Of course, such a "revelation" would hardly be news if this were an oil gathering. Oil transport from one end of the world to the other is commonplace. You could see the tankers awaiting passage into port outside the windows of the hotel.

But what's happening in natural gas is something else entirely.

Given its limitations in transport (as long as it remains in a gaseous state), natural gas has always been a localized energy source, with its deliveries essentially limited by where the pipelines go.

That created a very important pricing reality. Local spot markets were usually not possible except at a few "hubs" or main intersections in the primary trunk pipeline systems.

"Henry Hub" (actually named for a school that used to be in Erath, La., and the location where NYMEX gas futures prices are set) is one such primary hub. Baumgarten in Austria would be another. There are also smaller versions elsewhere providing more constricted local spot pricing.

But without significant exposure to spot pricing, most locations' prices are based on longer-term supply contracts. Internationally, especially in Europe, these are usually 20-year, "take or pay" agreements with the price based on a basket of oil and oil product prices. In this case, the end user is obliged to take a minimum amount monthly - usually 70% or more - or pay as if it had.

This arrangement comes with a noticeable downside that has been magnified these days: The higher the cost of oil, the higher the cost of natural gas.

Spot markets, on the other hand, provide for quicker ad hoc sales, usually over and done in 72 hours. If a regular supply can be assured, these short-term purchases will almost always undercut the multi-year pipeline contract prices of "take or pay."

Here's why the emerging trade in liquefied natural gas (LNG) is such a game changer for natural gas investing (and yes, I know the phrase "game changer" is overused these days, but in this case, it really fits):

Join the conversation. Click here to jump to comments…

Dr. Kent MoorsDr. Kent Moors

About the Author

Browse Dr. Kent's articles | View Dr. Kent's research services

Dr. Kent Moors is an internationally recognized expert in oil and natural gas policy, risk assessment, and emerging market economic development. He serves as an advisor to many U.S. governors and foreign governments. Kent details his latest global travels in his free Oil & Energy Investor e-letter. He makes specific investment recommendations in his newsletter, the Energy Advantage. For more active investors, he issues shorter-term trades in his Energy Inner Circle.

… Read full bio

Login
guest
guest
0 Comments
Inline Feedbacks
View all comments
LIVE
Visit Money Morning Live


Latest News

January 19, 2023 • By Money Morning Stock Research Team

These Stocks Could Go To $0

January 9, 2023 • By Money Morning Stock Research Team

The Government Is Pouring $391 Billion Into These Stocks - Buy Now

December 27, 2022 • By Money Morning Staff Reports

6 IPOs in 2023 You Can’t Afford to Miss
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Profit Takeover This Is VWAP Penny Hawk Trading Today Midday Momentum Pump Up the Close
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Night Trader Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Extreme Profit Hunters Profit Revolution Warlock's World Quantum Data Profits Live Trading Alliance Trade The Close Inside Money Trader Expiration Trader Vega Burst Trader Flashpoint Trader Darknet Hyper Momentum Trader Alpha Accelerators

© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz