Sieben Blog

Sieben Energy in Attendance at North American Energy Conference

Dan Bailey — Mon, 01 Mar 2010 14:23:00 GMT

On Wednesday, March 3, Jerry Burin and I will be attending the North American Energy Conference sponsored by Enbridge Gas Services. This annual event, to be held this year at the Westin Lombard Yorktown Center, provides background on the U.S. natural gas market—where it has been, where it is now, and where it may be going.

The first of two scheduled keynote speakers is a director from the American Gas Association. He is expected to provide fundamental analysis of natural gas supply, demand, production, and consumption. The second speaker, a vice president from United ICAP, is expected to provide a technical and financial perspective on the natural gas market and the economy as a whole. Previous conferences have provided a wealth of information. This year, it will be particularly interesting to hear what the speakers may have to say about prospects for climate legislation, including cap-and-trade.

Over the past few years, the natural gas market has certainly been in flux. Prices rose to multi-year highs in the summer of 2008 before plunging to multi-year lows just over a year later. We are constantly monitoring the pulse of the market to help our clients manage their exposure to energy price fluctuations. Sieben Energy Associates has developed energy purchasing strategies for a number of large organizations to help them minimize the impact of high energy prices.

If Enbridge’s North American Energy conference this year is as good as it has been in previous years, we can expect to come away with a great deal of insight that will inform the work we at Sieben Energy Associates perform on behalf of our clients. Of course, nobody can predict the future with 100% certainty; for that reason, we are continually capturing energy commodity market news from a variety of sources, reviewing and filtering it to understand the consensus position, and communicating the relevance of it to our valued clients.

This Winter’s Heating Bills

Dan Bailey — Mon, 04 Jan 2010 15:10:00 GMT

After the holidays, some people can’t wait for spring’s arrival, while others are enjoying the chill in the air and snow on the ground. The middle of winter is also an important time to examine oil and natural gas markets, understand how weather has impacted them, and speculate about where they could be headed for the remainder of the season.

Based on my analysis of leading industry information, we can expect near-term upward pressure on oil prices in the face of continuing cold weather, a weakened dollar, optimistic economic data, and geopolitical issues. Monthly employment numbers announced at the end of this week could, however, lead to a sell-off and drop in prices if the figures are surprisingly negative.

Severe cold across much of the U.S. has contributed to higher heating prices than predicted before we headed into winter two months ago—regardless of whether heat is provided by oil, natural gas, or electricity. Expect short-term pressure on prices for January and February, but the jury is still out regarding March. If milder weather returns for the latter half of January, prices for February should ease from where they now stand.

Natural gas storage numbers to be announced this Thursday, January 7, will be critical. Withdrawal will likely be sizeable because of the markedly cold temperatures across the U.S., but if the withdrawal is surprisingly greater than expected, prices could jump higher. But there is still plenty of gas in storage, and so a sustained price rally—with prices climbing higher and higher over the next one or two months—is unlikely. At some point, temperatures across the U.S. will return to normal for the winter, and weekly withdrawal from storage will subside to moderate levels.

Industrial demand for natural gas is not expected to return to pre-recession levels until 2013 or 2014, so even though we may be using more gas than expected to heat our homes and businesses this year, we’re not using as much in manufacturing. This is buffering consumers somewhat from a price shock during what is, thus far, a very cold winter.

But the warmth of spring will return soon, and with it, we can expect a decrease in our monthly gas prices.

Remarks on Wind Energy at Crain's Chicago Business

SEAadmin — Mon, 07 Dec 2009 05:52:00 GMT

Craig Sieben has remarked at Crain's Chicago Business on the development of wind energy in Illinois and its potential for helping advance a new energy economy