Oil & Gas Prices - Jan 30

[dan_s]

"The bottom line is that geopolitical headlines remain plentiful and uncertainty remains exceptionally high," Babin wrote. "Heading into the weekend, crude is likely to trade in whichever direction the headlines push it

There is a lot of "noise" impacting the global oil market, but with U.S. crude oil production now on decline, the fundamentals also point to higher oil prices in 2H 2026.

https://www.msn.com/en-us/money/markets/crude-oil-bounces-as-trump-says-armada-headed-for-iran-rekindling-middle-east-fears/ar-AA1UR1yP

Trading Economic:
WTI crude oil futures rose more than 2% to about $61 per barrel on Friday, extending gains for a fifth straight week supported by geopolitical and supply risks.
The move followed renewed warnings from US President Donald Trump toward Iran, raising concerns over potential military action that could disrupt oil flows. Trump said the US has an armada heading toward Iran, while US officials confirmed warships including an aircraft carrier and guided missile destroyers will arrive in the Middle East in coming days. Supply worries were reinforced by ongoing outages in Kazakhstan, where output at the giant Tengiz oilfield has yet to resume after a shutdown earlier this week. Also, the dollar slid toward its worst week in seven months, making crude cheaper for non-US buyers amid strained US-Europe relations and unresolved Ukraine peace talks.

Natural Gas price in the U.S.
US natural gas futures rose above $5.27 per MMBtu on Friday, recovering from an earlier drop of more than 3%, as the market continued to brace for a historic winter storm.
The prices are up more than 65% since the start of the week, the largest weekly gain on record, driven by forecasts for widespread below-normal temperatures across most of the country. The severe freeze, especially in southern gas-producing regions, has raised concerns about ice forming in pipelines, which could disrupt production and exports. Storage data showed inventories fell 120 billion cubic feet to 3.065 trillion cubic feet last week, a larger draw than expected but still leaving stockpiles about 6.1% above the five-year average. Analysts expect the next report to show an even larger withdrawal as frigid conditions boost heating demand and increase pressure on available supply.

Keep in mind that the gas price above is for the FEB26 NYMEX contract, which will expire on Thursday, January 29.

The MAR26 contract closed at $3.643/MMBtu on Friday. I do expect the trading range for HH natural gas to be $3.50 to $4.50 for the next ten months, which sets up a very good year for our Gassers.

[dan_s]

The production mix for all 37 of our model portfolio companies can be found on tabs 2 and 3 of the Sweet 16 Summary Spreadsheet, which can be found on the EPG website under the Sweet 16 tab.

On the individual company forecasts you can find details on each company's hedges.
Companies with the most exposure to rising U.S. natural gas prices are AR, CTRA, EQT, RRC, CRGY, MGY, BSM, KRP.

Ngas prices in Western Canada have not risen based on the winter storm in the eastern U.S.

PEY.TO and TOU.TO do have outstanding marketing groups and they get U.S. gas prices for a high percentage of their gas. I like Peyto's dividends, 5.5% annual yield and likely to be increased.

I have seen rumors that Coterra (CTRA) will be merging into Devon (DVN), but it has not been confirmed. They are both solid companies. A merger this large will draw a lot of Wall Street's attention.
My current valuation of DVN is $48/share.
TipRanks rates DVN a Strong Buy: "Based on 21 Wall Street analysts offering 12 month price targets for Devon Energy in the last 3 months. The average price target is $42.53 with a high forecast of $55.00 and a low forecast of $35.00. The average price target represents a 10.07% change from the last price of $38.64."

[dan_s]

Oil futures now telling us that WTI price of more than $60/bbl for the year 2026 is likely.

https://www.cmegroup.com/markets/energy/crude-oil/light-sweet-crude.quotes.html