The US Energy Information Administration (EIA) has indicated that New England spot natural gas prices have hit record levels this winter.
Two key factors have triggered higher regional prices:
- Deliveries of regassified LNG from Northeast terminals are down more than 30% so far in 2014 compared to the same period in 2013.
- Major pipelines transporting natural gas into New England have been congested.
According to data from IntercontinentalExchange (ICE), the day ahead wholesale (spot) natural gas price at the Algonquin Citygate hub serving Boston averaged US$ 22.53/million Btu between 1st January and 18th February. This price is a record high for these dates since the ICE data series began in 2001, and 50% above the same period in 2013, when cold weather drove New England prices to their highest level since 2004.
Increased weather driven demand for natural gas and constraints on supply resulted in the average bidweek (the last three trading days of the month for the prompt month contract) price for natural gas delivered at Algonquin in February 2014 reaching a record high of US$ 33.79/million Btu.
Average 2014 daily consumption of natural gas in New England has risen by 4.7% over the same period in 2013, from 4.4 billion ft3/d to 4.6 billion ft3/d. Higher demand has pushed up prices in both spot and futures markets.
Edited from various sources by Claira Lloyd
Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/24022014/record_natural_gas_prices_in_new_england_187/