Can Shift to Clean Energy Smoke Kinder Morgan (NYSE: KMI) Stock?

• Kinder Morgan shares were down 0.33% than the previous close.
• The US may see heavy reduction in fuel capacities this year.

Energy market is making a shift to clean energy considering increasing carbon footprints. Industry players are adopting this change gradually to reduce the possibility of a “Three Degree World”. Meanwhile the infrastructure providers are helping deliver natural gas, petroleum and other associated liquids, they may face the impact of this change.

LNG Market May Saw Limited Growth This Year

Kinder Morgan (NYSE: KMI), an energy infrastructure provider, has consistently been losing value since mid-January 2023. Data shows that KMI stock was currently trading at $18.22, down by 0.33% in the past 24 hours. Reuters recently reported that the company closed down its Texas-based carbon dioxide treatment facility, citing equipment failure and third party outage. They are currently the largest natural gas providers in the US.

On one hand, reduction of greenhouse gas emissions are currently the primary focus of authorities, fossil fuel depletion also remains a major issue. Either way, the impact is detrimental for the energy infrastructure providers. According to a US Energy Information Administration (EIA) report, the country may see heavy reduction in power capacities this year.

Report says that operators are planning to retire 8.9 GW of coal-fired capacities in 2023 considering the facilities’ age around 40-50 years. Meanwhile, 0.4 GW of petroleum-fired capacities are anticipated to retire this year. Sammis Power Plant and Pleasants Power Station, two of the leading plants in the US, are expected to retire by the year’s end.

The US may also see limited growth in the Liquid Natural Gas (LNG) market this year. According to EIA, only 4 projects associated with the sector may surface in 2023 with a combined capacity of 1 Billion cubic feet per day (B/cfd). Australia and the US are dominating the market for quite some time, representing 75% of the global LNG capacity with 22.7 B/cfd.

The recent calamity in Turkey and Syria where the death toll has reached 16,000 according to BBC, has affected operations at Ceyhan oil terminal. Though there’s no ill-effect to the oil pipelines, the ones connecting Kurdistan region were suspended to prevent any undesirable incident.

KMI Stock Price Analysis

An inverted megaphone like pattern indicates declining stock volatility over time. Company shares gained about 20% between September and November 2022. The price followed a regression trend before plunging to $17.39 in December. Parallel channel combined with a ghost feed shows gradual increase in the price, though a long term scenario might be different considering the market fundamentals.

Fib retracement shows the price is testing $18 levels where a breakout may push KMI stock to around $18.5. The company may face large blows considering the potential introduction of regulations associated with environment protection in the future. RSI and balance of power highlights seller dominance in the market. However, analysts at The Coin Republic believe it will deliver profits in a short run.

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational purposes only, and they do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.