Winter heating bills should be lower this year, industry figures say
Thursday, September 28th 2006, 10:32 am
By: News On 6
WASHINGTON (AP) _ Natural gas producers predicted Thursday that consumers will see lower prices this winter because there's plenty of natural gas already in storage and more is being produced.
The Natural Gas Supply Association said in a report that there are record supplies of the fuel in storage, well above normal levels as the winter heating season approaches. It said that wholesale prices already have been declining significantly.
``There is good news for consumers going into this winter. For the first time in four years we're seeing downward pressure on prices,'' said Chris Conway, the association's chairman and also an executive at ConocoPhillips.
The NGSA does not report gas prices, but the association produced figures from other sources that showed a dramatic drop in wholesale natural gas prices this year.
A year ago, as the industry faced major losses of supply because of Hurricane Katrina, wholesale prices going into the winter ranged from around $12 per thousand cubic feet. Recently, the prices dipped below $4.50 per thousand cubic feet at the wholesale level.
Conway said that overall, natural gas production this year ``will be substantially higher'' than in 2005, as the industry steadily recovered from the hurricane a year ago and stepped up onshore production.
Consumers have faced soaring winter heating bills for the last three winters.
While lower prices are expected this winter, Conway said the supply picture could change if there is an unusually cold winter season, and that could cause the cost to consumers to increase.
The NGSA is the trade group representing natural gas producers.