‘Just Ridiculous’: The Energy Crisis Realizes
Markets remained jumpy Wednesday as higher yields and rapidly rising energy prices kept traders on edge.
Adjectives like "ridiculous" were bandied about as Dutch and UK gas futures surged some 40% to new records (figures below).
"We are currently living exceptional circumstances," one analyst at an energy consultancy declared.
Wednesday's moves came atop 20% increases on Tuesday. Earlier this week, Reuters cited more than a half-dozen sources in reporting that Glencore, Gunvor, Trafigura an
Asymptotic rises in energy prices fairly quickly reverse these days. In order to sustain these prices through the winter you are going to need a cold winter. An average or warmer winter will portend a fairly rapid reversal in natural gas and oil prices- especially if economic growth starts leveling out. I have seen the stories about shale not ramping up- when you see oil prices go up any more- shale producers can simply hedge their output and drill more to produce more cash flow. It cannot ramp up in an instant but shale production is pretty fast. When you get more shale you also get more associated natural gas as well. And there are more LNG facilities coming online. This spike will probably last through late December or maybe sooner. Take my forecast at face value- it is a guess- but it is a pretty well informed one.
It’s past time for nations of the world to realize we’re all in this together. ‘It’s a Complex World’ (the Young Adults) and any nation believing they can just take care of their own is screwing themselves as well as everyone else. The ‘screwing effect’ used to have a built-in delay, but not so much anymore.
Appears to be a trader’s paradise.
Are these market swings “much ado about nothing”?
We’ll find out when you get your January gas bill.
I am betting that Biden backs off “green energy/curbing oil drilling” when the cost to fill up America’s gas-guzzling trucks/SUV’s causes anger and a backlash against Dems. Same goes for natural gas.