I can't comment on BSM and CNX; however, for some of the Canadian natural gas companies, I have noted that a relatively large percentage of their profit (but not revenue) was related to the price of the natural gas liquids components they obtained from their natural gas. These natural gas components were highly correlated to the price of…
I can't comment on BSM and CNX; however, for some of the Canadian natural gas companies, I have noted that a relatively large percentage of their profit (but not revenue) was related to the price of the natural gas liquids components they obtained from their natural gas. These natural gas components were highly correlated to the price of oil. So, even when the price for the dry natural gas component was very low, the companies seemed to be happy to pump all they could (especially from wetter gas reservoirs) in order to make a profit from the liquids components. Might that contribute to the better correlation to oil than gas that you observing?
I can't comment on BSM and CNX; however, for some of the Canadian natural gas companies, I have noted that a relatively large percentage of their profit (but not revenue) was related to the price of the natural gas liquids components they obtained from their natural gas. These natural gas components were highly correlated to the price of oil. So, even when the price for the dry natural gas component was very low, the companies seemed to be happy to pump all they could (especially from wetter gas reservoirs) in order to make a profit from the liquids components. Might that contribute to the better correlation to oil than gas that you observing?