Prepare to spend more on home heating | News, Sports, Jobs
Those who heat their homes with natural gas should plan to wrap themselves in a blanket a little more often – or spend more to pay their gas bills.
Officials from the National Fuel Gas Corporation recently said natural gas prices on the New York Mercantile Exchange were about double the cost at the same time last year. Rising commodity prices and forecasting a snowier and colder winter in 2021-2022 than in 2020-21 lead National Fuel officials to predict that the average gas bill from November to March will rise. from $ 498 last winter to $ 714 this year. That’s a 43% increase.
WHY PRICES ARE INCREASING
The increase in the price of natural gas is caused by several factors, according to National Fuel officials. Global demand for domestically produced liquefied natural gas has increased as domestic production of natural gas has been halted and natural gas storage stocks are below normal.
“As required by state regulations, the utility is required to purchase sufficient quantities of reliable and inexpensive natural gas to meet customer demands during a colder than normal winter.” National Fuel officials said in a recent press release. “The costs of supplying natural gas are passed on to customers dollar for dollar, with no mark-up or profit for National Fuel. “
Wholesale prices in Europe and Asia are more than five times what they were a year ago. Power companies in Europe and Asia are engaged in bidding wars for shipments of liquid natural gas, pushing up costs, according to the Associated Press. Prices are also rising in the United States, which converts some of its natural gas into liquid and ships it to Europe and Asia. These higher costs show up in the gas bills of consumers around the world. Analysts expect these prices to rise further during the winter, when customers rely most on fuel.
As demand increases, supply decreases. When the pandemic raged, oil prices plummeted and producers ran out of money to drill. Once they cut back on oil drilling, they also got less gas back, as most wells pump both oil and gas out of the ground. Europe burned a significant amount of natural gas last winter to heat homes in freezing weather, leaving storage tanks with little fuel. Then the summer was less windy than usual, so the wind turbines did not generate as much energy as expected. This, in turn, led countries to burn more natural gas, further depleting reserves.
At the same time, Russia has reduced its supply of natural gas to Europe, Carlos Torres Diaz, analyst at Rystad Energy, told The Associated Press. All of these factors combined to cause natural gas prices in Europe to skyrocket to around $ 26 per million BTUs, up from just $ 4 at the same time last year. A similar trend occurred in China and Japan: Power plants burned more natural gas than usual to cool homes on a series of unusually hot days. Prices have jumped to $ 29 per million BTUs in Asia, Rystad Energy calculated, from $ 5 a year ago.
Ira Joseph, analyst at S&P Global Platts, noted that demand for liquid natural gas has been robust, even at much higher prices. In Japan, Pakistan, Bangladesh, Taiwan and Indonesia, prices are so high that power companies are likely to burn oil instead, according to Rystad. For the terrestrial environment, this could become an alarming trend. Burning oil generates more climate-damaging emissions than burning natural gas. The wholesale price of natural gas in the United States has exceeded $ 5 from $ 2 to $ 3 in most of the past two years. It’s the highest price since 2014, although it’s well below levels reached in the 2000s, when prices exceeded $ 10 per million BTUs.
COLD WINTER FORECAST
The Old Farmer’s Almanac predicts a cold, snowy winter for most of Chautauqua County in what the almanac calls “A season of chills.”
“This winter could well be one of the longest and coldest we have seen in years”, says Janice Stillman, editor of The Old Farmer’s Almanac.
This forecast is echoed by Accuweather.com, whose models show winter conditions may arrive earlier in the northeastern United States than they have in the past two years. AccuWeather’s long-term forecasters team, led by senior meteorologist Paul Pastelok, has made their annual forecast for the upcoming winter season, giving people across the country time to prepare for what should be a busy winter from coast to coast. AccuWeather predicts some similarities this year compared to last winter due to a weather phenomenon known as La Nina.
Last winter, La Nina was a driving force that shaped weather conditions across the country throughout the season. La Nina is a phenomenon that occurs when the water near the equator of the Pacific Ocean is cooler than average. In turn, this influences the jet stream and the trajectory of storms as they pass through North America. It is also the counterpart of the most famous El Niño. La Nina is expected to shape some of the overall weather again this winter, but Pastelok said the next La Nina will be weaker than last winter. This ” open the door “ so that other elements are taken into account in the winter forecasts, especially during the second half of the season.
“This winter, I think, is going to be colder, at least for the interior sections of the Appalachians to the Ohio Valley and the Great Lakes,” said Pastelok.
Temperatures in those areas were near normal last winter, but this year the winter as a whole is expected to average 1 to 3 degrees Fahrenheit below normal, according to Accuweather. The weather could get colder in November, Pastelok said, with the possibility of snow in November in the northeast interior. The severity and frequency of snow and cold air are expected to ease a bit in mid-December before making a strong comeback in January.
“This is the month that stands out” said Pastelok. Heating bills could peak in January and residents of the northeast, especially those living along and west of the Appalachians, could feel the effects.
– The Associated Press contributed to this report.