Natural Gas Update, August 31, 2018
We may be starting the winter with around 3,250 to 3,350 billion cubic ft (BCF) of natural gas in storage. That will be drastically below all historical benchmarks, which are usually between 3,750 and 4,000 BCF. While market prices continue to be good, future prices may be impacted by the storage situation and other factors like severe weather.
As you can see from the attached weekly storage report from the Energy Information Agency (EIA), current storage is 19% below the 5-year average for this time of year.
At this point, the market doesn’t seem concerned, because of the strength of production numbers, which continue to rise slightly. However, natural gas storage supplies will soon start to be utilized during colder weather.
If you are able to shop for natural gas supplies, this may be a good time to lock in predictable rates that you can get from favorable contracts. As an example, you can shop for natural gas supply in many areas of the following states: (FL, GA, IL, IN, MA, MD, MI, NJ, NY, OH, PA, TX).
Be sure to get multiple bids from suppliers since the rates and terms can vary dramatically.
Finally, even if you buy your natural gas from a third-party supplier, your utility company really doesn’t care. They make their money from delivering the gas, regardless of the source.