Natural Gas Prices
About Natural Gas Prices
The supply/demand balance

Factors affecting prices

Natural gas is a publicly traded commodity and, like other fuels, its price is influenced by the market forces of supply and demand. There are multiple factors that influence supply and demand and determine the wholesale price of natural gas.

Supply

Production
Natural gas production, which is primarily in the United States and Canada, has grown but has not kept pace with rising demand. This has resulted in dramatic fluctuations and rising prices since 2000. This trend is expected to continue.

Storage
Storage levels, or the amount of natural gas kept underground or in above-ground storage containers, is also an important factor affecting prices.The current storage levels are above average and sufficient for the  heating season ahead.

Other
Events like hurricanes, record-setting crude oil prices, infrastructure problems, etc. can affect the ability to produce and transport natural gas. 

Demand

Weather 
National weather has the greatest impact on natural gas prices. When winter temperatures are colder than normal, demand is higher and, usually causes an increase in natural gas prices. Conversely, warmer winter weather often means lower prices. Prices are affected by weather in large population centers, especially in the eastern U.S. where usage is especially high in the winter months. Weather also has the greatest impact on customer bill amounts because it determines how much gas is used.

Economy 
Growth in the nation’s economy has driven demand for natural gas. In addition, new residential and commercial growth, new uses of natural gas by industrial companies, electric generation, which creates demand in the summer, and record-setting crude oil prices have all affected demand for natural gas.

Availability of natural gas

The long-term availability of natural gas supplies is sound, and known reserves of natural gas are plentiful and sufficient for many decades. The U.S. has a natural gas resource base equal to about 63 years of consumption at current production levels. Additionally, Canada and Mexico have large reserves that are accessible to U.S. markets. CenterPoint Energy secures ample supplies of natural gas to ensure you have the natural gas you need to heat your home this winter. CenterPoint Energy secures ample supplies of natural gas to ensure you have the natural gas you need to heat your home and business.

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