Natural Gas trend since February 2007
Natural gas shows at being right at $6.5 MMBtu for today as it came down low in the morning and spiked up this afternoon. This has caused electricity prices to follow right along. We saw electricity prices come way down this morning and then spike up some in the afternoon.
Natural Gas Prices compared to Electricity Prices:
Take a look at the commercial electricity prices (per megawatt hour) this morning while natural gas was at its low at $6.27 MMBtu:
| JULY 2007 Start Dates | ||||
| Daily Pricing ($ per MWH) | ||||
|
Houston |
North |
South |
West |
|
|
3 |
$ 81.94 | $ 81.38 | $ 82.28 | $ 81.99 |
|
6 |
$ 76.04 | $ 75.61 | $ 75.66 | $ 76.08 |
|
9 |
$ 77.89 | $ 77.39 | $ 77.22 | $ 77.89 |
|
12 |
$ 79.64 | $ 78.98 | $ 78.80 | $ 79.61 |
|
18 |
$ 83.13 | $ 82.50 | $ 81.93 | $ 83.03 |
|
24 |
$ 84.00 | $ 83.07 | $ 82.55 | $ 83.62 |
|
26 |
$ 85.92 | $ 84.97 | $ 84.32 | $ 85.51 |
|
36 |
$ 85.81 | $ 84.58 | $ 84.05 | $ 85.16 |
|
47 |
$ 86.16 | $ 84.83 | $ 84.34 | $ 85.43 |
Now look at the adjustment this afternoon when natural gas reached $6.55 MMBtu, almost a 5% increase in the natural gas spot price:
As you can see a 5% increase in natural gas caused electricity prices to increase by about a point.
Now as we look at the trend of Natural Gas since February we see a direction trending downward. We can’t be sure how much longer the downtrend will last but in the face of very hot weather for the summer months we could start to see it begin to break before long. Until then signing up on a natural gas contract or electricity contract for an extended term looks like a smart decision.
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August 14th, 2007 at 3:05 am
I’ve enjoyed your article about energy and would just like to say that I believe natural gas will be going up after the stock market has settled down.