Against a backdrop of mostly mild weather across the Lower 48, winter unleashed its fury on the West Coast a bit early this season. The frigid temperatures and unusually heavy precipitation have fueled natural gas demand at a time when storage inventories are low, a drought has reduced hydro-electric power supplies and regional utilities are having trouble receiving coal deliveries.
The result: historically high natural gas prices that have surged to levels not seen since the summer of 2018. The surge in prices has spread across the Pacific Northwest, farther south throughout California and inland across the Rockies.
On Thursday, Northern California’s PG&E Citygate recorded spot natural gas prices as high as $36.00/MMBtu. SoCal Citygate cash reached a $33.00 high, while Malin hit $32.00. And that only proved to be batting practice.
On Friday, the highest price on the West Coast hit $55.00, with offers up to $60.00.
“I’ve seen prices spike before, but over a short period of time,” said Michael Wiliamson. His consulting firm Williamson Energy purchases wholesale natural gas for end-use customers in California.
“This sustained period of high prices has never happened before. There’s a lot of different things going on, and they’re all falling at the same time.”
www.zerohedge.com/energy/perfect-storm-fuels-massive-natural-gas-price-spikes-west-coast
