1. For crude producers to be healthy, crude needs to be 60% higher ($75).
2. For natural gas producers to be healthy, natural gas needs to be 300% higher ($7.50).
3. For coal producers, coal needs to be at least 60% higher (met coal at $180)
Most analysts believe that all of the above prices are going lower.
Record low for BTU, ACI & ANR closed below $1 and WLT closed below 50 cents. NRP traded 3 cents
above a record low. Crude and natural gas are collapsing. Nothing but continued slide for energy stocks.
A big volume day will take NRP below $7 tomorrow.
Dow up 173. Crude down and natural gas up slightly. NRP opened up, dropped into the red and
now up slightly on below average volume.
Bank America downgraded shares of BTU this morning. Said that thermal and met coal
prices will continue to drop in 2015 and 2016 due to oversupply.. Means that most coal
companies will continue to lose hundreds of millions of dollars each year far into the future.
Must say that NRP insiders should be commended for buying NRP shares in the past. Hope they will
pick up the buying again. A 100% payback in less than 4 years with the $$1.40 distribution.
NRP, WLT AND CLF traded at all time record lows. BTU (largest US coal company) traded 6 cents
above a record low. ALL GOING MUCH LOWER. Analyst just on CNBC sees crude in the $20
range. Hope the oil producers react more quickly than did the coal miners who have sold coal below
mining costs for three years. Still no light at the end of the tunnel for the coal miners.Most believe
that WLT will be the first to bankrupt.
To expand on the above:
1. I find it hard to believe that any mining company would open a new mine in Appalachia.
2. I also find it hard to believe that any bank in the world would loan money to ANY mining
company to open a new mine in Appalachia.
Dow down 184. Crude down but natural gas up slightly. Coal stocks continue to fall.
NRP CRASHING ON BIG VOLUME. Distribution now above 19%. GOING MUCH LOWER.
The strong dollar is killing ALL commodities.
New all time record low for NRP.. In recent quarters, NRP shares have dropped
20 to 35%. That would put the short term bottom between $6.03 and $7.42.
Coal news gets worse. PRB coal price dropping with warmer weather. Almost all
coal companies already losing staggering amounts. Almost all pure play natural
gas companies now losing staggering amounts. And now, most crude oil companies
are underwater (using crude pricing below $50). ANOTHER REALLY BAD WEEK
COMING FOR NRP AND OTHER COAL COMPANIES. No turnaround in sight.
M reasoning is much more simplistic. If BTU continues to lose $300 million per year , as is
their plan for 2015, they will not be able to cover the billion dollar note in the year 2020. HOW
AND WHEN DOES BTU STOP LOSING $300 million per year??