Welcome to the weekend edition, a small collection of links to interesting personal finance related articles and economic news from around the web.
If you found 2010 painful for natural gas prices, wait until we go through 2011. Reality is setting in for producers that natural gas prices won’t be going anywhere in 2011 as the glut continues. Just look at 2011, so far we are in the middle of a cold winter rich with snow storms and Canadian spot prices are still languishing under $4/mcf. Can you imagine where natural gas prices will be next autumn? It might turn out to be a fire sale on all of the NG weighted Canadian juniors who were not quick enough to balance their production with oil.
“We cannot stand these low prices for much longer.” Says Jeff Wojahn, president of Encana Coproration’s USA Division.
Encana just lowered their capital expenditures for 2011 and is expecting single digit growth instead of double digit growth. Hedging future production is no longer possible for producers as forward prices have collapsed as well.
If you’re a contrarian who has a lot of patience with natural gas, make sure you invest in companies that have solid balance sheets, very low cost of production and if they can afford a dividend all the better since it relieves the pain of seeing hefty paper losses while you wait for prices to recover.
I don’t think I have the patience for it, as such I will be evacuating my NG weighted positions before winter is over keeping only a token exposure through Perpetual Energy (TSE:PMT). I guess I am officially with the bears on this one, at least for 2011.
What are your thoughts on natural gas prices for 2011?
G-7 Will Be Overtaken by Emerging Economies in 2032
China Backs Euro in Investing Record Foreign-Exchange Reserves
China’s Economy Expanded at About 10% Pace in 2010
World Food Prices Jump to Record on Sugar, Oilseeds
Fed May Keep Easing at `Full Throttle’ Until Decline in Unemployment Rate
On to our weekly blog roundup:
Invest it Wisely: Blogging resolution for 2011.
Million Dollar Journey: Why low interest rates are a good thing.
Boomer and Echo: TFSA and non-registered accounts.
The Passive Income Earner: Dividend Yield: Royal Bank of Canada (TSE:RY, NYSE:RY)
Balance Junkie: 2011: What to Watch
Mony Reasons: My Stealth Emergency Fund?
Retire By 40: Investment Fundamental #8 – Real Estate
Buck Inspire: I Did Not Beat the S&P
MomVesting: Stock Analysis: Fundamental vs. Technical
Money Cone: How to be a Dead Beat
Budgeting in the Fun Stuff: A “How To” Guide to Budgeting
101 Centavos: Five S’s for the 2011 Spring Vegetable Garden
Dividend Monk: Four Things I’m Bullish On Going Into 2011