Morning Thoughts – Oldinvestor

Hurricane positions at National Hurricane Center website

You should be seeing a lot of images such as the one above or the one below.

Hurricane Laura at National Hurricane Center website

It appears Marco is just a Tropical Storm and will remain that way, but will be dumping a lot of water along the coat in the gulf. The image above is the projected path for Laura, and will become a Hurricane. It is also headed right for Sabine Pass and Cameron LNG export facilities. It appears possible the storm surge, or a lot of water may get dumped on Corpus Christi and Freeport terminals.

Depending on how much is needed for storage, LNG pipeflows may drop soon or may continue to flow slowly. The ports are already empty of any ships, but the terminal can still take and store gas for use as soon as boats can re-enter the terminal.

A number of production platforms will also shut in due to these storms. As of market open yesterday afternoon here, I would think the market thinks demand is going to be hit harder than GOM (gulf of mexico) gas production. Also weather predictions are showing cooling across the US. I generally don’t trust the weather forecast when hurricanes are entering the Gulf. Hurricanes seem to mess with prediction models and realized temperatures can vary greatly from the prediction, even 5 days out. For this reason I wouldn’t put as much emphasis on the weather prediction, but it’s still a bearish factor I can’t ignore all together.

Sabine Pass, Cameron, Freeport, and Corpus Christi LNG export facilities at Google Maps

I believe the other day I posted an image of LNG Tanker loads for the first 19 day so of the month. I think I stated it was of all facilities, and it was just Sabine Pass. Here is the corrected/updated shot of all US export facilities.

LNG exports – Number of loads exported by the 19th day of the month each month.

Above is the first 22/23 days of the month, and August is showing strong improvement. Of course we also see this improvement in pipeflows to export facilities.

My objective is still the same. I still believe UNL move high by mid winter, and BOIL will decay. My positions remain the same:

UNL – 50% of funds in from $7.4

BOIL covered puts

BOIL covered put positions as of market close 8/21/20
Covered puts P/L as of market close 8/21/20

I think I will short some extra shares of BOIL. Maybe 20 shares. If BOIL will move $5 down from here, I’ll be happy with that. I do feel NG prices could drop on the drop in LNG export demand. The numbers aren’t showing up yet in pipeflows, but they will be affected eventually with no boats at port. Good Luck


I have decided not to short more BOIL. I’m heavy enough at the current price. No need to go asking for trouble that I know BOIL could cause me very quickly. Staying conservative on this and keeping my positions unchanged.