Energy Market Update: January 22, 2018

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How will the recent cold snap affect the gas production in Pennsylvania and Ohio?

In this week's Energy Market Update, Tim Bigler — Direct Energy Business Energy Strategist — looks at gas and electric prices in Southwest Pa. and Eastern Oh.

Watch the video below to learn more.

Natural Gas Production and Prices

Prior to the recent cold snap, production was increasing for natural gas and set a record high, due to wells head freeze-offs.  Bigler says now that temperatures are leveling out again, natural gas production numbers will climb back up to all-time highs.

Prices for natural gas from April to October have bounced up around $.30 due to this recent cold snap. The question is will prices go back down like they were in October 2016? With pipeline expansion, this could be possible.

Southwest PA and East OH Electric Prices

Power prices are very close to all-time lows for the April to October time-period. Pipeline expansions and record production will be even higher when we get to summer time and will mitigate any kind of heat wave. 

What could support prices for electric and gas in 2018?

Exports out of the region and power sector hedging could make prices fluctuate depending on buying gas and selling power. As always, above average temperatures play a huge part in price and cold weather continues, we are seeing substantial decline in natural gas inventories, which would create gas on gas competition.

Stay tuned to the Direct Energy Business Blog for the latest energy market news and information.

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Posted: January 22, 2018