![\"\"](\"http:\/\/www.fnarena.com\/ckfinder\/userfiles\/images\/Natgas.jpg\")
<\/p>\n\n\t<\/p>\n
\n\tBy Rudi Filapek-Vandyck<\/p>\n
\n\tA completed and confirmed head-and-shoulders formation for natural gas and a technical break-out for crude oil futures – has the divergence inside the energy sector ever been as pronounced as this year?<\/p>\n
\n\tWe doubt it. Rising risk appetite or not, natural gas prices remain captivated by the revolution in the global energy sector, a revolution that goes by the name of shale gas or, if we take an Australian approach, coal seam methane gas.<\/p>\n
\n\tDifferent names, same basic principles, same macro-economic outcome: the US has transformed from an importer of natural gas into an exporter and Europe is now keen to add unconventional sources of natural gas as well – with some urgency as the Russians have yielded too much power for too long when it comes to the supply of gas in the eyes of many European politicians.<\/p>\n
\n\tThe opening up of newfound sources of non-traditional gas supply has had one marked impact on the sector: prices have been pushed into a relentless bear market, while cousin crude oil is experiencing the exact opposite.<\/p>\n
\n\tPre-Easter economic data have traders and experts talking about US$90 and US$100 per barrel again. And while others keep on pointing out that lacklustre global demand at this stage does not even deserve oil prices at present levels of mid-US$80s, it remains to be seen whether anyone with a long position in the oil market really cares.<\/p>\n
\n\tTo complement the market-momentum picture as described above, technical market analysts at Barclays Capital have now provided a technical picture that remains supportive for further divergence between oil and gas prices in the near future.<\/p>\n
\n\tAs fas as natural gas prices are concerned, price charts show a completed head-and-shoulders pattern in combination with prices falling below four and six month old trendlines; confirming the bearish outlook.<\/p>\n
\n\tAs far as crude oil futures are concerned, the analysts are now convinced prices are on their way to US$90\/bbl. And as this price level represents the 50% retracement level of the July\/December 2008 decline and a nice round number, the analysts suspect the price level will prove “sticky” initially. Ultimately, however, they believe resistance will give in, allowing prices to surge to US$94\/bbl.<\/p>\n
\n\tFor the short term, crude oil and natural gas should move into the same direction, with natgas prices expected to put in a counter-trend bounce after the recent sell-offs. Longer term a return to the 200 moving average is anticipated and that is a whole lot lower than present price levels.<\/p>\n
\n\t![\"\"](\"http:\/\/www.fnarena.com\/ckfinder\/userfiles\/images\/crude_oil(1).jpg\")
<\/p>\n","protected":false},"excerpt":{"rendered":"
Prices for crude oil and natgas are seen heading into opposite directions.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[24],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/56452"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=56452"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/56452\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=56452"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=56452"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=56452"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}