[OilsNotWell]

$this->bbcode_second_pass_quote('', 'H')urricanes wiped out boats, docks; stalling recovery: Dallas Fed

Washington (Platts)--19Oct2005

An unlucky choice of staging areas to service offshore rigs and platforms may be one of the culprits behind the energy industry's inability to quickly recover production following the twin blows of Hurricanes Katrina and Rita, the US Federal Reserve Bank of Dallas said in its latest look at Gulf Coast states' economies.

"Katrina's damage to Louisiana's staging areas for the Gulf forced the industry to move its logistical base to Cameron[, Louisiana], which was wiped out by Rita," the Dallas Fed noted in its "Beige Book" released Wednesday.

"Loss of docks, boats, warehouses and equipment has hampered repairs in the Gulf. The repair effort will create jobs for diving companies, supply boats and helicopter transportation for months or years to come."

The Fed also noted that the hurricanes' damage to the energy complex has begun to spill over into other industries, notably chemical manufacturers.

Immediately after Rita, the Fed noted, 90% of the region's chemical plants were closed, creating a drop in demand that permitted normal storage injections. As the chemical plants re-open, the Fed said, they are having trouble obtaining gas as a feedstock.

"A lack of basic inputs is keeping a number of chemical plants on partial or complete shutdown," The Dallas Fed said. "Contacts say the actual damage to these plants is not serious. The system is unbalanced for a number of products, pushing up costs and prices."

According to the Dallas Fed, the situation has pinched chemical supplies and chemical manufacturers are raising prices and rationing production on products such as ethlyene propylene and a host of plastic products.

[donshan]

$this->bbcode_second_pass_quote('Marklar', 'A')ccording to this article virtually all natural gas companies have their supplies ready for the Winter and prices are going to fall.

$this->bbcode_second_pass_quote('', '
')Here are some things I know about natural gas. I know from National Gas Intelligence, the news service for industry insiders, that virtually all the local distribution companies already have all their supplies for the winter laid in. So there's no actual shortage. Oil has fallen quite a bit in the last week or so. It seems to have found a new comfort zone at the $61-$62 range. How about next week? My guess is that we will see it back in the 50's soon, but for how long?

[OilsNotWell]

Free market advice! (caution, worth about as much as you paid for it...which was nothing... )

$this->bbcode_second_pass_quote('', 'N')atural gas demand coming back faster than supply: analysts

Washington (Platts)--24Oct2005

Demand for natural gas is increasing faster than the recovery of production supply from the Gulf of Mexico, energy analysts at investment bank Friedman Billings Ramsey said Monday, pointing to long-term tightening in the gas markets and upward pressure on gas prices.

"We remain bullish on the long-term outlook for the sector and believe natural gas prices are supported by this balance and could potentially increase with winter weather," analysts David Khani and Andrew Coleman said in a note to clients Monday.

"There have been marked improvements in refinery, chemical and power plants, with few damaged," the pair noted, in contrast with "the slow improvement from supply and corresponding infrastructure (gas processing plants, offshore pipelines and production facilities). We now estimate that the year-end 2005 net impact of Katrina and Rita is 1.2 Bcf/d of demand outstripping supply," Khani and Coleman said.

While the two stock analysts did not include a gas price forecast in their note, they did say that companies heavily into gas production were undervalued, with Wall Street pricing them as if gas were $6/MMBtu in contrast to the $12/MMBtu to $13/MMBtu range of front-month futures prices on the NYMEX gas contract.