SUNDAY EDITION

December 4th, 2016

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editorials

 
Torchlight Energy Resources: Update After Breakout
Clive Maund  Nov 24  

Torchlight in the Middle of 20 Billion Barrel Oil Field
Bob Moriarty  Nov 22  

Oil Market Update
Clive Maund  Nov 16  

Oil Market Update
Clive Maund  Sep 13  

Nailing the Bottom of Oil
Bob Moriarty  Aug 23  

»» more editorials in the archives

market data


Ux U3O8 Price (Uranium)Nov 28th, 2016
$18.25 -$0.25 www.uxc.com



»View Commitment of Traders.

expert analysis & newsletter briefs

NexGen Energy Ltd.

"My top pick for 2016 is NexGen Energy Ltd. . . Arrow is an emerging world-class deposit that is still in the early stages of discovery. The state—it being so early in the delineation and development process—means a lot of upside still remains. . .the company just closed a $21M financing, which means the company has enough cash to carry through 2016 and beyond." (12/23/15) - Gwen Preston, Resource Maven

NexGen Energy Ltd.

"My top pick for 2016 is NexGen Energy Ltd. . . Arrow is an emerging world-class deposit that is still in the early stages of discovery. The state—it being so early in the delineation and development process—means a lot of upside still remains. . .the company just closed a $21M financing, which means the company has enough cash to carry through 2016 and beyond." (12/23/15) - Gwen Preston, Resource Maven

Fission Uranium Corp.

"Fission Uranium Corp. announced it entered into a binding letter of intent with China's CGN Mining, a subsidiary of nuclear giant China General Nuclear Power Group, to acquire 19.99% of Fission as part of an CA$82M strategic investment, along with a potential future offtake agreement on production from Patterson Lake South (PLS). . .we urge investors to bolster positions in Fission as the deal derisks development financing, and in the interim, should fund PLS through full feasibility and permitting." (12/22/15) - David Sadowski, Raymond James

Energy Fuels Inc.

"Energy Fuels Inc. is the only conventional uranium producer in the U.S. and the second-largest producer overall. It has the potential become #1, given the projects and mines it has on standby or that are close to being in development. At full ramp-up we expect the company to be able to produce 5–7 Mlb/year, in a country currently producing 4–5 Mlb/year. The U.S. consumes 55 Mlb/year, but only about 10% is supplied domestically. U.S. utilities seeking security of supply will greatly prefer U.S. producers over those from Kazakhstan, Russia or Africa. This company is well positioned to benefit from higher uranium prices. We have a Buy rating with a target price of $11.85/share." (12/22/15) - The Energy Report Interview with Rob Chang

Fission Uranium Corp.

"Fission Uranium Corp. announced it entered into a binding letter of intent with China's CGN Mining, a subsidiary of nuclear giant China General Nuclear Power Group, to acquire 19.99% of Fission as part of an CA$82M strategic investment, along with a potential future offtake agreement on production from Patterson Lake South (PLS). . .we urge investors to bolster positions in Fission as the deal derisks development financing, and in the interim, should fund PLS through full feasibility and permitting." (12/22/15) - David Sadowski, Raymond James


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from the publisher
  Robert J. Moriarty

Welcome to 321energy.



The Energy Report

Phil Flynn
http://www.pricegroup.com/
pflynn&pricegroup.com


The Energy Report 12/02/16

Natural Gas Meets the Press

While the oil market grabbed the spotlight, considering the historic OPEC agreement and rightly so, we also must keep an eye on natural gas. The natural gas market has had an impressive move as of late and yesterday's price spike got help not only from a slightly friendly supply report, but a weather prediction that made news and was front and center on the "Drudge Report". A headline today says that "KILLER FREEZE TO GRIP USA...COLD ANOMALY, Record cold coming to 'almost entire USA' - Low temperature records set to be SHATTERED" caught traders attention who up until now, were really getting mixed signals about the weather.

Traders were talking about conflicting American and European weather models and are not quite sure if they should be positioning long or short based on the forecast. Now because of these shocking headlines they are giving in to the cold side. Sure, we had a 50bcf withdrawal from supply that was within 1 bcf of the average estimate but the decisive move higher had a lot to do with the press surrounding these 'killer freeze" reports.

The main report came from climatologist Dr. Roger Pielke Sr. who said that, "'I cannot recall last time I have seen such a cold anomaly forecast across almost entire USA." Those thoughts were backed up with a map by Dr. Ryan Maue of WeatherBell showing that over 75% of the USA will be below freezing for overnight lows on December 8th. Dr. Pielke says that cold records will be shattered, "By the end of NEXT week, some states will be running 36 F BELOW NORMAL." These forecasts changed a lot of trader's positions with this killer cold prediction even though many weather forecasters are skeptical about this prediction. Dave Tolleris of WXRISK feels the forecast is too general to be taken seriously and while he is predicting colder weather, it may not be the historic event some others are predicting. At the same time, it wouldn't hurt to be pulling out the heavy coats, scarves and mittens just in case. Besides, the cold can make a person feel warm all over when they are long natural gas!

Oil is pulling back but while US producers are ready to go back on line, we may not see a major spike in US output right away. We will see smaller shale producers ramp-up on the perception that OPEC has cut production and US producers will then fill every barrel and this thinking is wrong. As reported by the IBD, "U.S. shale producers were the big winners of OPEC's decision Wednesday to cut production by 1.2 million barrels per day, but the deal won't immediately fix high debt loads, lack of skilled workers and other issues that shale producers need to resolve before ramping up production."

As reported, "There were casualties on capital spending and future capital spending, so even though the war is over and welcomed by everyone, thinking the U.S. producers are going to ramp up production to where they were even a year ago is ill-conceived," said Phil Flynn, a senior market analyst at the Price Futures Group. Domestic crude production has edged up to the highest level in nearly six months, but Flynn thinks it will take a least a year before output really heats up in the U.S." Companies are going to need more capital from banks, and it will be more difficult to borrow money because they have been burned in the past." While rig counts have been rising in the Permian and Colorado's DJ Niobrara basin, Flynn said most of the recent rigs were added to replace rigs in decline or to hold leases. U.S. producers also could be hesitant to ramp up activity as the OPEC deal is contingent on Russia and other nonmembers scaling back output."

The FT wrote an article that agrees with that outlook. The FT reports that, "The agreement by Opec, the oil producers' cartel, to cut output has been welcomed in the US industry as a godsend for hard-pressed production and service companies. But many groups are still expected to be cautious about stepping up production, as they seek to strengthen fragile balance sheets."

Of course I am hearing from some friends from the oil patch that are so happy that OPEC has made a deal. David Easley sent me a picture of an oil rig that was illuminated in holiday splendor saying, "The old oil derrick in Breckenridge, TX will shine a little brighter tonight". Mr. Easley says that, "So many marginal wells have been shut here in North Central Texas, it won't take a week to get them back up and running. This will get some small producers back in the game. I'm very happy to see it!" So am I David. So am I. Merry Christmas!

There is a substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. PFGBEST, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Phil is one of the world's leading energy market analysts, providing individual investors, professional traders and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline and energy markets. Phil's market commentary, fundamental and technical analysis, and long-term forecasts are sought by industry executives, investors and media worldwide.

PLACING CONTINGENT ORDERS SUCH AS "STOP LOSS" OR "STOP LIMIT" ORDERS WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS. SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Alaron Trading Corp. its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Contact Phil at 800-935-6487 or pflynn&pricegroup.com.



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December 4th, 2016

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