BP and Exxon will own 85% of north American natural gas production….
We for sure have fewer rigs producing right now. The main questions in my mind right now are... 1. Will declining production balance with weaker demand before hedges expire in a big way? 2. If we begin to see some improvment in the economy or other factors could we find ourselves in a situation where we have cut production so much we can't satisfy some short term demand increase? 3. I tend to believe if one is looking only at the U.S. for signs of economic recovery they will miss the inflection point of recovery. I think other economies in the world will turn earlier than the U.S. Any thoughts?
China and India will recover with reasonable growth. The US will limp along for the next 10 years especially given the financials have not removed toxic debt and personal debt will take years to work off.
Nat gas however will see supply constraints in the next couple of months and that will cause prices to firm up. There wont necessily be an huge company implosion as each company dramatically reduces cost by cutting drilling.