Gas prices halve, no surprise

Who would’ve thought that Gas prices could go down, let alone halve.

Well, the Dutch TTF Gas price has as has the Japan Korea LNG Marker (JKM) price.

It may seem perverse that this can happen but not really to others.

Henry Hub Natural Gas has nearly halved from its $10 peak.

Well, its currently $6 and nearing that $5 call I made in this note;

Market forces tend to fix extreme moves in prices.

October 18, 2022

by Rob Zdravevski

Bubbles: Natural Gas, LNG, Coal and Lithium

Anecdotally, the most euphoric noise that I hear globally surrounds three markets, being LNG, Thermal Coal and Lithium/Spodumene.

Especially amongst gas prices, I can’t hear anyone making a case for a moderation of prices.

The herd is all huddled together on the same life rafts.

Sure, prices can go higher but I dare you to initiate a new ‘long’ position.

My commentary is to heed warning.

The technicals and the spikes in price action are pointing to extremes which I think provide a terrible risk/reward skew for any recent or new entrants to these markets.

Producers and Sellers of such commodities would be well advised to lock in prices.

Buyers should elect taking a calculated risk of probability and not commit to fixing in those higher prices.

Owners of listed securities exposed to these sectors are doing themselves an injustice if they are not acknowledging the speculative fervour, let alone pondering taking the ‘fat part of the trade’.

The charts below show prices being Overbought, trading to 3 standard deviations and stratospheric miles above their 200 week moving averages.

Although one day doesn’t make a season, the Dutch TTF Natural Gas and Japan/Korean LNG Market prices are down 25% and 15% respectively, thus far, thus week.

August 31, 2022

by Rob Zdravevski

It happens over and over again

One month ago, do you remember hearing that European Gas prices were soaring higher?

It was all across the financial media.

Since then, that price was fallen 40%.
It’s funny how you don’t hear this news in the media.

Conserve your energy and mental bandwidth.
Just be careful being sucked into the noise vortex and the financial media’s chosen narrative which only lasts a day or two.

During all of that, some dill paid a high of EUR 130 per megawatt hour.

October 28, 2021
by Rob Zdravevski

Long Oil is crowded

I’m advising clients to tune in where the noise is and where the herd is gathering.

Albeit, this is subjective and certainly more art than science, it’s important to identify the “crowded trade” and asking yourself if you are about to be the marginal buyer.

For example,

“everyone” is going Long Crude Oil, Natural/LNG Gas and Coal.

and “nobody” wants to buy Chinese equities nor Gold.

There is merit considering a contrarian result.

With Brent Crude Oil currently $83, I ask myself if it rises $20 or falls $20 from here?

In the coming months, I say it sees $63 rather $103.

October 13, 2021

by Rob Zdravevski

Nothing natural about the moves in natural gas

Natural Gas prices in Europe have risen 7 fold in the past 7 months.

Bitcoin hasn’t done that……just saying!


On a more serious note, beware of parabolic price moves.

Watch but don’t play.

If you own gas which you can deliver into Rotterdam……sell it.

It’s a sellers market.

This price should halve, quick smart.

October 7, 2021

by Rob Zdravevski

A bearish reversal day for energy

What a difference a day makes, although one day doesn’t make a trend.

Overnight WTI Crude, Brent Crude, Heating Oil, Gasoline all fell 2%. Natural Gas fell 10%.

What is more important is last night’s trading session produced a bearish outside reversal day in all of mentioned commodities. This is where prices traded outside the previous day’s range, meaning today’s high and low was higher and lower than yesterdays range and the closing price was below yesterdays. It’s a bit more bearish because today’s close was lower than yesterday’s intra-day low.

September 7, 2021

by Rob Zdravevski

It’s a Gas, Gas, Gas !

I’m nearing some profit taking in #naturalgas

On April 30, 2021 I wrote about a potential Long trade in Natural Gas to watch out for, pending a technical analysis breakout.

The current profit taking suggestion is within a medium term context of a major bull market occurring in the Natural Gas price.

The breakout occurred around June 10th, 2021 and we’ve seen a 26% rise, since then.

Probability now suggests that Natural Gas takes a pause around the $4.07 mark.

July 22, 2021

by Rob Zdravevski

Drilling activity is increasing

Globally, 5% more rigs have been put to work since last month.
An increase of 63 rigs and it’s being seen in the America’s with the Canadians becoming notably busier.

I’ll assume tar sands become more feasible with Crude at $75?

Oil Rigs…going cheap !

This is the lowest amount of oil rigs in operation within the United States since……”like ever”.

For the Oil, Gas and Statistic nerds – Scroll through the historical data in this link and you’ll be quite amazed.

Do you know what is currently going cheap in the world ?

Buying or renting an oil rig……

October 8, 2020

by Rob Zdravevski

Hope equals complacency

Something that I have difficulty explaining tells me that the Cyprus situation can’t end well. This feeling is biased by the complacency exhibited by European politicians.

Loosely, there is an assumption it will be fixed by somebody. Almost a similar feeling that permeated prior to Lehman Brothers collapsing. There is also a distancing by Germany, that someone else will save Cyprus.

Keep in mind that Angela Merkel has an election in September 2013. Why would she use German money to save Cyprus following the backlash she experienced in Greece.

But here come the Russians.

I have read that $40 or $50 billion of private Russian deposits sit within Cyprus’ offshore banking haven.

Here is how you would do a sovereign bailout deal.

For a $10 billion bailout, Russia gets to protect its citizens deposits in Cyprus, take over a huge slice of Cypriot debt (which they’ll eventually make a profit from, as it’s currently trading at 65 cents in the dollar) and take ownership or security over Cyprus’ Aphrodite gas field.

The Aphrodite gas field has natural gas reserves of about 7 trillion cubic feet (tcf) worth around $45 billion. That is enough gas to meet the energy needs of 7 million households for 20 years. Cyprus only has a population of 1 million people.

Incidentally, Aphrodite sits next to Israel’s larger Leviathan (16 tcf) and Tamar (8 tcf) fields.

It possibly makes for some interesting scenarios involving the politics of Israel, Lebanon, Turkey, Syria, Iran & Russia????

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