The Bottom Line
As we head toward winter all signs seem to be indicating the energy markets will remain soft until the cold weather arrives. Even with the arrival of cold weather, strong natural gas production is likely to keep the stored supply up and prices much lower than last year.
NYMEX natural gas prices reached an extreme low this summer, and, despite some volatility, prices remain very low compared to historic levels. For the January 2020 NYMEX Natural Gas Futures, contract prices dropped from a high of $3.23 to its current level at $2.55.
Jan 2020 NYMEX Natural Gas Futures – Price History
For those of you who need to perform to budgets soon, pay close attention: this trend has created an excellent opportunity to lock in low priced fixed supply.
Customers who are on index pricing are also seeing very low rates at this time. We expect these prices to remain while there is no prolonged summer heat and LNG exports remain at low levels.
What to Know About 2019
While natural gas production is estimated to outpace consumption, it is not expected to bring back a large surplus. We expect that as the fall proceeds, prices will begin to rise due to a reduction in active wells (shut down to reduce available supply) and winter weather concerns. That said, even as prices rise, they will likely not rise as high as they did in 2018.
What To Do Now
Prices are currently very low for natural gas and only slightly reduced for electricity. If you have accounts on utility supply or a variable rate, this is a good time to consider moving to a fixed rate.