Climate change could be having an adverse effect on natural gas prices.
As The Wall Street Journal reports,warm October weather has sent natural gas demand lower this month. Half of U.S. homes use natural gas for winter heat. But yhere simply hasn’t been a need for heat yet in many parts of the country.
Another reason for dropping prices: The US currently has more reserve gas on hold than ever. Excess gas stockpiles have reached record levels as the U.S. goes into winter. As of Oct. 14, inventories were at almost four trillion cubic feet. That’s more than five percent above the five-year average.
Kent Bayazitoglu is the director of market analytics for Gelber & Associates. He thinks the market was already in sell mode even before the new stockpile numbers were released. But he said the stockpile count just “makes it a little easier for prices to fall a few cents lower.”
