NEW YORK (AP) — Winter officially began only a little more than two weeks ago, but already the mild weather is leading some analysts to scale back their predictions for natural gas prices, just when they might otherwise rise with the season.
Strong U.S. production has held down gas prices, prompting utilities to switch some generation from coal to gas.
Raymond James energy analyst J. Marshall Adkins said Monday that natural gas prices “still look like a train wreck through mid-year.”
Adkins lowered his forecast of average 2013 prices to $ 3.25 per thousand cubic feet of gas, down from an earlier forecast of $ 3.75. That would still be about 45 cents higher than last year, but not enough to be bullish on the stocks — the analyst has no “strong buy” recommendations among exploration and production companies.
“After a mixed 2012, don’t expect big energy stock gains in 2013,” he wrote in a note that also covered oil producers.
Jefferies & Co. cut its first-quarter gas-price call to $ 3.60 from $ 3.75 and raised its prediction for end-of-winter inventory levels.
Jefferies analyst Subash Chandra said the forecasts of more mild weather in January and more competition from hydroelectric power in the West were bearish signs for gas prices and inventories.
Natural gas futures were at $ 3.27 Monday afternoon in New York.
Gas prices could rise before the end of winter, as some weather forecasters see much colder weather later this month for a large swath of the U.S.
In afternoon trading, shares of Chesapeake Energy Corp. rose 20 cents to $ 17.60; Devon Energy Corp. rose 4 cents to $ 54.62; EOG Resources Inc. gained 14 cents to $ 125.94; Apache Corp. fell $ 2.65, or 3.2 percent, to $ 80.55; Anadarko Petroleum Corp. lost 35 cents to $ 77.92; and Exxon Mobil Corp., better known for oil but also a big gas producer, fell $ 1.33 to $ 87.63.
Energy News Headlines – Yahoo! News
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