Simple statement, I know. But given what I think we’re headed for in 2014-2015, I think current numbers look good, especially considering where we have been and where I think we are going.
Here’s something else I came across…these projections are from a producer..they are estimates for Conway propane inventory levels:
September is the traditional peak of inventories…and we built back to 24.3M in September of 2013…and we were all pretty concerned with that level as it was 3.3M BELOW the 5-year average of 27.6M. If this projection ‘comes true’ and we only get to 20.13M in September of 2014???? Goodnight now. Even if we only get back to where we were this past year, it’s hardly solid footing.
As for exports…keep in mind that if I think these numbers below are attractive, the export world will, too. There is no doubt they are buying out on the curve and already locking in arbitrage spreads overseas for late 2014, 2015 and beyond.
I think any gas you own south of $1.3000 at the terminal is going to be a winner between September 2014 and March 2015. You will not convince me otherwise because I don’t see many realistic mechanisms in place which will flood the market with gas. Cochin is gone next year…if we have any grain drying to speak of we’ll see more gridlock than we experienced this fall because of the lack of Cochin product. While some areas may be amply supplied, other areas are not.
I would recommend starting your cost averaging right now, if you have no done so already. I wouldn’t feel any unease owning gas at the numbers below, then as always hoping that is the highest price you pay. If you do this, I think you’re looking at a winner next year.