LEAP Correction - Sunday 9/17/06
Too many numbers!
The VLO entry described in the Sunday newsletter is incorrect. I changed the target price last week to $47.50 but did not change my personal order. I was filled at $50 on Friday and I wrote it up as though the $47.50 target had hit.
The VLO target in the newsletter is still $47.50 and VLO is still on the watch list until this target is reached. Sorry for the confusion.
I am reading a new book this week called "High Noon for Natural Gas." It is very enlightening and the outlook is not good. I have mentioned it before but probably not strong enough. The US came within just days of running out of natural gas during the big cold front in 2003. Just because we have such large inventory levels today does not mean we are out of the woods. Gas production in the US peaked several years ago and yet nobody is aware because of the imports from Canada are covering the shortage. With the oil sands production in Canada continuing to increase the demand on gas to heat the thousands of tons of sand every day is now over 2 BCF per day and growing. That number could reach 4 BCF by the end of the decade. That will take all the gas Canada currently is capable of producing and eliminate gas exports to the US. This is going to be a major problem for the US and it is just around the corner.
This will make gas stocks much more valuable once the next shortage begins. Hopefully the coming gas on gas price war over the next few weeks will allow us to get into CHK, ECA and other gas stocks at what may be a permanent bottom.
I put the report on the recent energy conference on the back burner due to some other commitments but I will try to get it out this week. Thank you for the many emails I have already received in reference to this weekend's newsletter. Keep them coming to Jim at OptionInvestor.com and I will try to answer your questions in the order received.