WASHINGTON — Natural gas prices have dropped about 13 percent from near $5 per MMBtu since the end of July, as high levels of gas in storage and lower expected demand due to cooler weather forecasts have influenced prices, the government reports.
Hurricane season, mid-August through early October, will also affect natural gas pricing. Forecasts of an unusually active hurricane season several months ago may have bumped prices. However, a lack of organized storm activity may be bringing prices down.
The projected Henry Hub natural gas spot price averages $4.69 MMBtu this year, a $0.74-per-MMBtu increase over the 2009 average, but virtually unchanged from the forecast in last month’s Energy Information Administration (EIA) Short-Term Energy Outlook. EIA expects the Henry Hub spot price will average $4.98 per MMBtu in 2011, down $0.19 per MMBtu from last month’s projection. A small decline in U.S. production and increased consumption are projected to lead to next year’s higher prices.
Propane pricing information is only collected during the heating season. American Coin-Op will follow propane pricing trends beginning in October.
EIA estimates that residential retail electricity prices during the first half of 2010 were about the same as in the first half of 2009. However, rising fuel costs for natural gas and coal are likely to push up retail prices later this year, causing prices over the entire year to grow by about 0.6 percent. Next year’s prices are expected to be about 2.9 percent higher than 2010 prices.
Driving to your laundry continues to be a bit more expensive than in 2009. EIA expects that regular-grade motor gasoline retail prices, which averaged $2.35 per gallon last year, will average $2.77 per gallon over the second half of 2010, up one cent per gallon from the average for the first half of the year.