Natural Gas Costs

Energy specialists throughout the world share the belief that natural gas is the most likely to revive gas later on, because natural gas is a cleaner and a more efficient fuel than petrol. Moreover, with petroleum supplies becoming smaller with every passing day, natural gas might be the only alternative left for fulfilling all energy requirements. Not surprising, natural gas now is experiencing increasing popularity in the United States, Asia and Europe. Another critical factor that’s driving the prevalence of natural gas is that oil supplies are becoming exhausted extremely fast.

Simple supply and demand model orders natural gas rates. As supplies become scarce and demand picks up, the purchase price of natural gas raises. Thus, natural gas cost treads a very tight balance between demand and supply in its endeavor to fulfill rising demand from homeowners, businesses, factories, schools and power-generation plants. Nowadays, natural gas satisfies about one-fourth of their entire energy demands of the United States, and is regarded as the backbone of their production, steel, glass, chemicals, cars, industrial and food industries.

The wholesale cost of natural gas in America throughout the 1990s was approximately $2 per thousand cubic feet (Mcf). This price tag, as stated by the U.S. Energy Information Administration, is predicted to reach 9 per Mcf during the present 2005-2006 winter months.

Natural gas prices appear to be influenced the most by climate conditions. This sensitivity to weather is more evident through winters, when folks have a tendency to use more gasoline for producing heat. During summers there’s a heightened need for heating system, which translates into a greater demand for power to electricity air-conditioning units.

Analysts that have noticed that the trends in natural gas costs lately have the belief that natural gas as a fuel option are a catastrophe waiting to happen. The analysis isn’t without reason. It’s now apparent, from current happenings a couple of months of inclement weather could lead to severe shortages and skyrocketing costs. And worst, there’s minimal supply side alternative.