US bank hikes 2005-6 natural gas price estimates nearly $1/MMBtu

Washington (Platts)--6Sep2005

Investment bank Jefferies' top energy analyst raised his 2005 and 2006
natural gas price estimates by nearly $1/MMBtu over the weekend, saying
Hurricane Katrina had eliminated the shoulder season between summer and winter
demand. 
     "The net effect of Katrina will be to provide a firm bridge over the
shoulder season between the peaks of summer and winter gas demand,
significantly reducing the chances of a sell-off in natural gas prices in
October, which we have previously seen as a risk," Jefferies' analyst Frank
Bracken told his clients Monday. 
     Bracken hiked his 2005 average gas price estimate 95 cts/MMBtu to
$7.75/MMBtu and added 80 cts to his 2006 price forecast, bringing it to
$7/MMBtu. 
     Bracken also indicated he may raise his price estimates even further, as
his contacts in the service sector had indicated "that damage to
infrastructure [is] likely worse than any of us know, and repairs may extend
will into 2006, auguring for higher prices than we have forecast today." 
     Bracken said the damage estimates made public over the weekend were
"alarming," before noting that the status of platforms, pipelines, and
processing plants in the eastern one-third of the Gulf of Mexico producing
region was still unknown.

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