New Pipeline Project Could Lower Natural Gas Transportation Costs to New York City

Future natural gas transportation costs to New York City could be reduced with the expansion of the existing Texas Eastern Transmission pipeline from Linden, New Jersey to Manhattan, New York (see map above). On May 22, 2012, the Federal Energy Regulatory Commission (FERC), the main jurisdictional authority over the construction of interstate natural gas pipelines in the United States, approved an 800,000 million British thermal unit (MMBtu) per day, or 800,000 dekatherms per day, expansion of the pipeline.

This project is slated to begin service in November 2013 and represents one of the biggest transportation service expansions in the Northeast during the past two decades. The project could have the following effects on the New York City market: reduce reliance on oil fired generators, enhance the reliability of natural gas supplies, and lower transportation costs especially in the winter. Spectra Energy secured firm transportation agreements for this expansion with these customers: Consolidated Edison (170,000 MMBtu per day); Chesapeake Energy Marketing, Inc. (425,250 MMBtu per day); and Statoil Natural Gas LLC (204,750 MMBtu per day).

         

Read the entire post at EIA.com

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Gold still at risk of a large downward move before the rally

Gold has been busy consolidating in what I believe will be a 13 Fibonacci month Primary wave 4 correction. The Gold bull market I’ve been following since 2001 is a likely 13 year bull cycle that will end in 2013 or 2014 depending on how you count. This current correction pattern is working off a 34 Fibonacci month rally that took Gold from 681 to 1923 at its ultimate highs. Last fall I warned about the parabolic run likely ending in the 1908 ranges and for investors to position themselves accordingly.

Today we have Gold trading around 1600 and our recent forecast in May was for a rally into Mid June topping around 1620-1650 ranges in US Dollars. The intermediate forecast still calls for a possible drop to 1445-1455 ranges this summer, the same figures I gave out on TheStreet.Com interview last September for a Primary wave 4 low.....Read the entire article and charts.


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CME: Morning Crude Oil Market Report for Tuesday July 3rd

August crude oil prices traded sharply higher during the initial morning hours, supported by hopes for more global central bank intervention to stimulate growth and better than expected Chinese service sector data overnight. Other crude specific fundamentals supporting the morning gain come from the ongoing oil workers strike in Norway that has reduced North Sea output and a growing fear premium in the market in response to reports that Iranian lawmakers have drafted a bill to cut oil tanker traffic in the Straits of Hormuz. Expectations for this week's delayed EIA crude stocks report are for a draw in the range of 2.25 to 2.5 million barrels.

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Exxon May Soar On New Potential In Mexico

Things have been looking great for Exxon Mobil (XOM) lately. Anadarko Petroleum (APC) recently indicated that Exxon may become a partner in Anadarko's Gulf of Mexico operations. Anadarko is already partnered with Plains Exploration & Production Company (PXP) on its deepwater Phobos project in the Gulf, and according to Anadarko Vice President of Investor Relations and Communications, John Colglazier, Exxon may enter the project with up to a 20% working interest, which would reduce Anadarko's interest from 50 to 30%.

In exchange, Anadarko could receive cash and a drilling carry, which would potentially cover the cost of the project's first exploration well. This would be beneficial for Exxon Mobil, and represents just one of the recent successes the company has seen lately. Below, I will show how Exxon's current position within the energy sector makes it a strong investment now.....Looking Deep for Gains

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Iran Drafts Bill to Block Strait of Hormuz

Iran's National Security and Foreign Policy Committee has drafted a bill calling for Iran to try to stop oil tankers from shipping crude through the Strait of Hormuz to countries that support sanctions against it, a committee member said on Monday.


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Looks like we are in good company SDRL

Looks like we are in good company. Most of you know we SeaDrill, ticker SDRL, is one of our COT fund favorites.....

Vanguard Windsor II fund manager Jim Barrow is "nervous" about oil and energy stocks, but is bullish on Seadrill as "the dominant factor" in high tech drill ships. SDRL has the world's newest fleet, Barrow exults: "Their boats rent for more than other people’s do. It is a great company run by Norwegians who know exactly what they are doing."

Adams video update "As we start Q3 is a global slowdown in the cards"

A surprise announcement out of the European summit pushed the market higher on Friday. It was also the end of the week, the end of the month, and the end of the quarter. For Q2 most of the markets were down, including the equity markets. We think that’s an important element to look at. We still believe the trend is down and intact and that Friday was more of a short covering rally.

Now, let’s analyze the major markets and stocks on the move using MarketClub’s Trade Triangle Technology.....Click Here to view today’s video

CME: Natural Gas Prices Holding at Upper End of Trading Range

Natural Gas prices are continuing to trade around the upper end of the trading range on lighter than normal volume (likely related to the holiday this week in the US) as the very hot weather across major portions of the US results in a larger than normal call on Nat Gas for power related cooling demand versus the possible loss of Nat Gas demand as the economics of coal to gas switching continues to fade at current price levels. The economics of coal to gas switching are hovering around the unchanged level between coal and Nat Gas and at a level where utilities could begin to move back to coal in light of the overstocked coal inventory situation at many utility facilities.....Read the entire article.

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CME: Crude Oil Prices Remain Firm

Crude oil and most risk asset markets drifted a tad lower after last Friday's meteoritic short covering rally on the back of the EU Ministers deal. The deal details are still not available and there are some indications from Finland (according to a report in Reuters) that the deal could be fraying. I am not sure that will be the case so early after the deal had been put together but these kind of rumors and comments are likely to emerge over the next several weeks as the technocrats begin the process of working out the details of the deal. As such the markets will be reacting accordingly to any indications that the deal is changing especially after the large rally on Friday.....Read the entire article.

Dennis Gartman: Sell into Strength, Crude Oil Rally Won’t Last

Energy bulls prepare for disappointment. Commodities pro Dennis Gartman doesn’t think any rally in oil will be sustainable.

“I don’t see how an advance can be sustainable,” says Gartman. “The amount of oil [CLCV1  84.46  0.71  (+0.85%)] coming onto the market - is overwhelming.”

First and foremost Gartman believes Saudi Arabia intends to keep the world well supplied because they want to keep prices low and squeeze Iran, which is more susceptible to lower oil. (Saudi Arabia and Iran are longtime rivals with Tehran openly challenging the legitimacy of the royal House of Saud.)

LIGHT CRUDE AUG2 (CLCV1) 84.46     0.71  (+0.85%%) New York Mercantile Exchange

But that's not the only negative catalyst for oil.

In addition, Gartman believes the market will be well supplied due to discoveries made right here in the US such as the massive discovery in North Dakota’s Bakken Shale.

And Gartman thinks the abundance of nat gas in the US is negative for oil because trucking companies have a strong incentive to convert their fleet to alternative energy.

All told, “I can see the rally in oil lasting another $2-$3 dollars but any bounce should be sold,” he says. “At the end of the day, I’d be a seller."

Investor Dennis Gartman tells "Fast Money" which way he thinks crude oil will be going in the second half of this year.

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