Morning Thoughts – Oldinvestor

Yesterday was the first day I’ve not been completely stressed about the market. Not because it had an up move, because that may not last. The move to UNL was a good one for me. The market is clearly near or at the bottom, but with negative roll yield/contango, even UNG is still not quite as safe an investment as I would like. UNL clears that up for me personally. I can let the leash out on my managing of it and not worry. The market will recover to something of fair shape by next year and UNL may be the only position worth taking for that long. When I started the blog, I had never held UNG for such a long period nor did I intend to. Anyway, I feel better about this, though movement will be slow in UNL.

I have not updates, but I can list my thoughts.

  • Bullish factors:
  • Summer weather is projected to be hotter than normal
  • Dry gas is still slowly falling, oil is going to be slow to recover so associated gas should be slow as well
  • The biggest long term factor is drilling has been cut by record numbers

  • Bearish factors:
  • Demand is going to take longer than we want to recover
  • Storage is horrible, and you know how I feel about South Central storage if you’ve been reading my posts
  • Covid19 is a real problem, one that general public and governments are not on the same page about, this factor is impossible to project a timeline or impact Covid19 will have on US or the World.

Keep an eye on South Central storage and associated gas recovery to be a key factors on the bearish side. Stop looking for something “to happen”. LNG will recover, but it’s going to be slow. Production has slowed, but is possible to add 3Bcf/d in a matter or weeks.

getting called to the supervisors office, hmmm

I’ll be holding UNL forever. Good Luck