Econ 101 lesson needed here
Since the beginning of widespread adoption of shale gas development, natural gas production is way up, and prices to the consumer are way down. And Chris and Art conclude from this that shale gas is a flop???!!!!
Chris, let me refresh you a bit with Econ 101. The price is down, so the drillers have less incentive to maintain production. If/when production falls, the price will rise. This will increase the incentive to drill out more shale, and lo and behold, the production numbers will go back up.
Nifty, huh? I'm glad to be hear to explain these things to you.
The broader point is this - natural gas will remain cheap for many years in the future (maybe not quite as cheap as right now, but much cheaper than what consumers were paying a few years ago. Production will remain high for many years in the future -- perhaps not quite as high as right now, but much higher than what Art Berman and you were predicting just a few years ago. This is because of shale gas.
Care to wager on this? Let's hear your prediction for natural gas prices 3 years from now. I say lower than $4. What's your prediction? I'd happily wager with you if you differ significantly.
