Nature has a hand in natural gas costs
TEXT OF STORY
Tess Vigeland: John [reporter John Dimsdale] mentioned inflation and certainly one commodity that’s seen inflated prices is natural gas. It’s not quite the end of summer but folks are already hunkering down for a long winter. Natural gas prices flirted with record highs this year. Experts say heating bills could be up 25 percent this winter. But Mother Nature is trying to help out. Marketplace’s Dan Grech reports.
Dan Grech: Natural gas prices have plunged 40 percent in one month. Lower crude oil prices have helped. So has the promise of new gas supplies from Colorado, Wyoming and New York. But a big factor has been a slow hurricane season. That’s allowed natural gas to flow uninterrupted out of the Gulf. Jamie Webster is an analyst at PFC Energy.
Jamie Webster: Weather matters a great deal.
So far this summer, Mother Nature’s kept her cool.
Webster: I wouldn’t call her necessarily friendly, but she hasn’t been as mean-spirited as she has been in the past with prior summers. Now we’re at this period of time, at least in the Eastern seaboard, where it’s quite a bit cooler for this time of year.
That means less air conditioning and a lower demand for natural gas, which is used to generate electricity. Tony Buck lives near Philadelphia. He switched to a natural gas heater a few years back.
Tony Buck: And I discovered to my amazement that natural gas was three times cheaper to heat my house than electricity.
It’s always dangerous to predict the weather, but meteorologists are forecasting a normal winter. That doesn’t mean it will be an inexpensive one. Tony Buck could pay 15 to 20 percent more this winter to warm his home. That would set him back 70 dollars more a month. That is, unless he doesn’t have to turn on the heat as often.
Buck: To not have a freezing cold winter in the Philadelphia area, who wouldn’t mind that?
I’m Dan Grech for Marketplace.
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