That has been my argument for a long time now. Thats why I am not giving up on Ng producers. It is clear that looking at Robry's extrapolation, the supply overhang will be gone next spring and we are looking at 1000bcf less storage than now. We will know more precisely just how much we are reducing the deficit week by week when we have spring weather when we normally have neither heating or cooling demand. When every article is focusing on storage and storage build (entirely due to weather) and totally ignoring changing supply and demand patterns which portray an actual supply deficit it leads to a mispricing of equities. How many articles have you read about the game change in natural gas with 100 year reserves, leading to the impression that we are drowning in natural gas. True, but these reserves have to come out of the ground, and right at this moment we are not producing as much as normalized demand requires. No mystery, as no one can make money at these prices. So as long as prices stay this low, we know there is every reason for demand to increase, and believe me the market will do that. On the other hand there is no reason to add to supply until prices improve, and the market will do that as well. So I see a continuing downtrend in production and I see a continuing increase in demand principally generation but not limited to generation. I remember well two other times that I just made a ton of money. It was in the 1990's when we had a natural gas surplus that no one thought would disappear. It did and those like me that then invested in Ng made a fortune.
The second time was when crude hit $10. No one was predicting higher crude prices then. In fact the economist famously wrote an article projecting $5 crude. Well then too I invested heavily in crude producers and voila made outsized gains.
Now how many times have you read on these BB its not yet time to invest in Ng producers. Its the same on the popular business channnels. Everyone is singing the same tune. Their concern is one of timing all concerned about timing the bottom, not that there is not good value. Well to me that spells huge bargains and thats why I take as a grain of salt all those that are prediciting doom and gloom--reserve write downs bankruptcy's etc etc. Enough of this rant, but I just had to get it off my chest as a rejoinder to those that think I live in lala land..