We are seeing a dramatic slowing in drilling (the Philadelphia Inquirer has a great article on the decision by oil and gas companies to stop aggressive drilling in the Marcellus shale).
We are seeing switches in budgets away from natural gas and toward oil and gassy oils in dramatic fashion. We are having a real hot summer--so hot that we are burning off a ton of the stuff. There's a plan to begin exporting natural gas from both Canada and Louisiana.
We are seeing utilities at last do joint ventures directly with natural gas companies, no longer content to just pay for natural gas.
We are witnessing the wholesale stopping of new coal plants and the shuttering of old coal plants and the quick building of new natural gas plants courtesy an Environmental Protection Agency that's the toughest we've ever seen. And it seems to be getting only tougher because of a recent U.S. Court of Appeals decision that pretty much gave the EPA unbridled power to come down even harder on coal plants.
We are seeing the mothballing of coal plants that aren't finished and the bankruptcy of utilities that were trying to build new plants.
We are watching trucks and now locomotives being built to use natural gas, and they are almost immediately economical.We are getting downgrades of the likes of Clean Energy Fuels because of the rapid build-up of competitors that want to provide nationwide natural-gas filling stations.
We are watching Ford and GM commissioning light-duty trucks for use among regular folks and small businesses.
And it's all for naught. Any bottom call--even one that says we are not on the upswing because natural gas has risen almost a dollar to $2.80--isn't worth squat with some acknowledgement or some push from Washington, and we aren't getting it from either candidate.
I have listened to Harold Hamm, the CEO of Continental Resources and Mitt Romney's energy adviser, talking about energy self-sufficiency, but Hamm's an oilman through and through. (I ought to know: I spent a couple of days with him in the field, and the greatness of Hamm and his Bakken North Dakota fields is that they provide clean-burning oil that's perfect for gasoline.)
He's not a real nat gas fan. Romney isn't either.
Hamm was a very important choice for Romney as an energy adviser. If he had picked someone schooled in natural gas--such as Anadarko Chairman Jim Hackett, or Devon Chairman Larry Nichols, or former XTO Energy CEO and founder Bob Simpson, all of whom are available--that would have said we are going to harness nat gas for surface vehicles, the Holy Grail of use.
And President Obama? He never stops saying that nat gas is just one of many fuels, and we know he and his base are anti-fossil fuel. He's not a fracking defender, either.
Without support from Washington, without at least an acknowledgment that it is the fuel of the future by one of the candidates, calling a bottom is a fool's errand.
Oh, and guess what? The nat-gas stocks are telling you the exact same thing. Sure, they may have bottomed, but they haven't gone higher either. Don't bet any time soon that they will without a change in the political environment. And I don't see one happening any time soon.
Disclosure: Cramer's charitable trust is long DVN.
