UNG has only been aroung for two + years so that is all the history we get on that. But if you look at the NG chart going back to the 1990s it looks like it spent the entire decade around 2 (It closed over 5 yesterday). If we are truely in the biggest recession in 25 years, I am wondering if this can drop substantially from here. I am looking for opinions if we can half from here or is this going to recover lost ground in the near term? I am not looking to cheer lead this down I have 5000 shares I just want your thoughts if this is going up or can we really halve from here.
I would say that the cost basis for finding, leasing rights, royalities and drilling for gas or oil today is much higher than 19 years ago. It might go back to $2, but not for long. Just when you say never is when it happens.
Well if it hits 2 I will crank my heat up in my home to 72. And enjoy the cheap gas that I lost $100,000 on. This market is so screwed up. I am not sure we will ever see 14,000 on the dow in our life times again.
I think you have to look at the inflation that has occurred between then and now. Any move for energy independence will utilize NG as a substitute for oil. As I posted earlier, NG to long chain hydrocarbon is not only doable it is much more efficient and cleaner than coal to liquids. The US dollar is effectively devalued by 30% relative to the Euro. If you graph the price of other commodities relative to NG, I think we can see that there is a heavy discount. I'm cautiously long.