Relief for Consumers as Natural-Gas Prices Drop ; Ten Months after Katrina Caused a Price Spike, Electric Utilities Switch to Natural Gas

By Ron Scherer writer of The Christian Science Monitor | The Christian Science Monitor, June 21, 2006 | Go to article overview

Relief for Consumers as Natural-Gas Prices Drop ; Ten Months after Katrina Caused a Price Spike, Electric Utilities Switch to Natural Gas


Ron Scherer writer of The Christian Science Monitor, The Christian Science Monitor


Even with their air conditioners at full blast, some consumers might eventually be in for a surprise: relief on their energy bills.

The price of natural gas has fallen about 50 percent since hurricane Katrina drove up prices last fall. As oil prices hover around $70 a barrel, analysts say the spot price of natural gas now equals the energy potential of oil worth $41 a barrel - a differential that is spurring businesses and utilities to start switching over to the less costly fuel.

They are finding many eager sellers. Storage is at such high levels that some producers will either have to further reduce their prices orcurtail production. The high inventory volumes might also auger lower prices this winter, when natural-gas usage reaches its peak.

"If we have no hurricanes in the Gulf and say the summer is not particularly brutal, we'll go into the winter heating season with some relief," says Neil Gamson, who follows energy prices at the Energy Information Administration, the US government's official energy price forecaster.

Mild winter temperatures caused gas prices to fall while supplies increased as newly drilled wells in the West started production. After Katrina, the average price of natural gas topped out at close to $12 per thousand cubic feet, according to the EIA. Tuesday, the spot price hit $6.69 on the futures market.

The price break on natural gas occurs as a key House committee has fashioned a bill that would allow each coastal state to decide whether to permit natural gas drilling on the adjacent Outer Continental Shelf.

The US Minerals Management Service (MMS) estimates 420 trillion cubic feet of gas lies offshore - enough to supply the US with 14 to 16 years of gas at current usage levels. "The numbers we're using are very conservative," says Chris Tucker, a spokesman for Rep. John Peterson (R) of Pennsylvania, a co-sponsor of the legislation.

The planned expansion of liquefied natural gas (LNG) imports could also augment supplies. LNG is natural gas cooled into liquid form for transport in specially designed tanker ships.

Last week, the Federal Energy Regulatory Commission (FERC) approved the application for three new LNG terminals and additions to two others. The new facilities come at a time when imports of LNG are picking up in the US.

"People are expecting this to be a record year for LNG imports," says Dave Shin, chief economist at the American Gas Association (AGA) in Washington. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Relief for Consumers as Natural-Gas Prices Drop ; Ten Months after Katrina Caused a Price Spike, Electric Utilities Switch to Natural Gas
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.