RE: Price going down;;there is a limitYeah, there has been all kinds of downside pressure but in my experience, the markets are always a tug-of-war and you're quite right that prices can't go down forever. Many of the natural gas players are also involved in the oil industry. If it's really what the markets dictate, then many can shift the focus to oil for a while. I tend to think this is NOT what the markets will dictate but these type of forces could come into effect for a short while -- until everyone realizes how much Natural Gas is needed after all and there is a big push back.
If natural gas gets cheap enough, it starts to make more and more sense for industries struggling under the weight of a weak economy to look at using cheap natural gas to fuel their transportation fleets.
US consumer are being whacked with high jobless rates AND inflation. Despite this relief at the pumps has been pretty minimal in the US just like here in Canada. I think all this means that consumers will be thrilled to see more NG vehicles on the market. GM is responding to this and others will too if it means remaining competitive in the current economic climate.
With a globally weaker US dollar due to all the sovereign debt fun, it makes more and more sense for the US to reduce it's reliance on foreign oil. Obama has definitely shown a leaning towards bringing North American natural gas into the transportation sector. With a need to finally start reducing the massive US debt, the current oil industry subsidies are going to have to fall under more and more scrutiny.
Bottom line, I think there is going to be increasing economic pressure to develop the uses of cheap NG in transportation and industry.
The markets are a tug of war. Nothing goes down forever and nothing defies the laws of supply and demand forever no matter what short selling traders might like.
Mark