NEW YORK, NY -- (Marketwire) -- 11/02/11 -- Natural gas prices have remained relatively stable this Fall as consistently large supplies have offset increased demand during the cooler months. In the long term there is hope that supplies will drop, driving up the price of natural gas, as more advanced liquefaction and export facilities are able to transport the gas to energy hungry emerging markets. The Paragon Report examines investing opportunities in the natural gas market and provides equity research on United States Natural Gas Fund (NYSE: UNG) and Cheniere Energy, Inc. (NYSE Amex: LNG). Access to the full company reports can be found at:
A recent Reuters poll found that analysts have trimmed their US natural gas price estimates for 2011 and 2012 due to rising shale gas supplies, though increasing demand and a slowdown in drilling could lend support further out. Some expect production growth to slow in 2012 as producers finally slow drilling, but most analysts agreed projected gains in demand are not likely to be enough to soak up the excess supply.
New drilling techniques have resulted in an oversupply of Natural Gas, which has kept prices down since the recession.
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In the long term, the natural gas market appears poised for growth, however. Demand is robust in China and India, and new LNG liquefaction plants and export facilities are expected to allow North American producers access to energy hungry emerging markets.
Reports from Bloomberg find that Liquefied Natural Gas prices are surging to a three-year high as demand from Japan, China and India outpaces supply increases, boosting sales for producers. Liquefied gas costs surged about 33 percent after Japan's March 11 earthquake and tsunami caused reactor meltdowns at Tokyo Electric Power Co.'s Fukushima plant, and have since climbed toward $16 per million Btu, according to Mark Greenwood, an analyst at Citigroup.
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