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Natural Gas

from ChartWorks:: published by Institutional Advisors

Bob Hoye
Technical observations of RossClark@shaw.ca
January 5, 2007

Last week’s natural gas inventory drawdown of 46 Bcf keeps the inventory level of 3,121 Bcf at the second highest level for the third week in December. Without a severe cold snap there is a likelihood of spot prices drifting to $5.50 or lower in January.

Arrows identify when inventories were at multi-year highs in the first week of September and again at the peak in November

Working Gas in Underground Storage
(Third week in December marked with red diamond)

The cumulative decline is running below the pace that helped create spike highs in the price in 1995, 96, 97, 00 and 02. Longer-term, the models following the first quarter of 2007 look exceptionally bullish with a new 21-month high being the norm by the end of next year. The stocks should provide significant buying opportunities through January-February.

Bob Hoye
January 5, 2007

EMAIL:: bobhoye@institutionaladvisors.com
CHARTWORKS WEBSITE:: www.institutionaladvisors.com

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