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Clearview Energy Partners managing director of research Kevin Book weighs in on natural gas futures, saying “supply curves don’t slope downward....
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Hitting a three and a half month high off the government data showed inventories fell more than expected last week so futures dropped more than 10% so far this -- so can this rally keep going let's bring in Kevin book.
Managing director -- resource a clear view energy partners Kevin.
Thanks for being here.
Are we gonna see these prices continued to climb what do you think.
Yeah I think expectations for natural gas prices that are gonna keep following -- production keeps rising.
Are pretty unrealistic and in most parts of the world an economic theory supply -- -- bikers don't -- downward.
So -- prices are normalizing now and it's a result of a lot of things that are happening.
Behind the scenes in the production side is also part of the economy recoveries he shouldn't be that -- about it.
Yeah I think obviously and and look.
Bush -- You know natural gas seems to me in the United States of America to have -- of a bad rap I think people are not sure that -- -- frightened of -- I don't know what it is because we have -- a -- of abundance of this energy resource stumbling.
Yet the -- is really scared a lot of people and they're thinking about the three times last fifteen years and not just has broken our hearts than any starlet you can name.
But this is different we do have a different resource we have a new production technique from a different part of the source rock it it is a very different story for sure.
And what about exports -- mean.
Aside from what we're using here and I know we could be using a whole lot lot more how the exports -- -- increasing those.
Well it still is a -- process and fortunately the the current plan right now.
Would involve going through a review with the department of energy and also review with the Federal Energy Regulatory Commission.
The -- -- view is a relatively straightforward it's about environmental soundness and about whether or not -- commercially viable.
The -- -- process is murkier right now only one company has been given an export license.
And there's currently more than a dozen waiting in the wings so there's a political question being asked its.
Whether we can export our newfound bounty.
Are right now the political leaders aren't sure.
You know I saw a report today to the Chinese -- he and and the angry is planning to spend millions -- these natural gas fueling stations.
For trucks along US highways is fascinating -- -- these big old.
-- semis I guess would be fueled.
-- buy gas problem and -- seems to be happening I've not heard about this but it's already.
The infrastructure is starting to be put into place and I would imagine that they.
The potential for this is enormous.
The potential is absolutely enormous and it's it's actually happening organically.
Pretty much within defined routes where you have fleets that can buy the trucks and -- hall in and predictable ways.
Down the road this couple things could happen railroads freight locomotives could certainly open up a new market but you want engine manufacturers body the idea that this is worth investing in.
We're probably will view the tail end of the decade when we'll start to see this really start to gain traction become meaningful part of the market.
Fascinating and quickly exports to Mexico expected to double -- next year is that right.
All this fighting about LNG in the pipeline -- -- are going up.
Yeah absolutely.
They -- it we've got it and it's coming mostly from Texas which is close so it makes all the economic sense in the world.
Very good indeed well we'll see this store is -- because Kevin.
