RE:NAT gas prices now moving up ALOT...We are stuck in the mid-high 30s despite all the positive news about natural gas. The only negative part is that we may hit 4 trillion storage before the draw season. Other than that, everything I read is about better supply/demand balance even deficits in the 5 Bcf/d range in the winter. LNG coming back, we should catch up 5 year average storage levels in early 2021. You name it and it seems positive for natural gas. Is the market priced for perfection?
Despite all of this, Crew are others are not going up. I have a feeling this is dead money until companies prove they can become more profitable. Unfortunately, I think Q3 will be a difficult quarter. Nat gas prices only improved in late July, so we had 1 month out of 3 at low prices. Production is not likely to be higher than 20,000boe/d. A lot of money will have been spent for the 7 wells which will likely increase the balance on the line of credit, Hopefully, the market will aceep that. The important part will be the outlook. Not just for Q4 but for the entire 2021. If management is not too conservative, hopefully it will help the stock price.
I still think Q1 is the big test. If nat gas continues to increase and average price stays above $3 for the entire 2021 as per EIA, I hope Crew takes that Q1 profitability and the option on the infra deal to drill more wells. Late 2021 and 2022 will be the year to pay down the debt.