Natural-gas Glut Grows in Warmer Winter
From Columbus Dispatch
By Brian K. Sullivan and Naureen S. Malik
The 2012-2013 heating season has been warmer than usual in the large energy-consuming cities of the Northeast and Midwest, cutting demand and prices for natural gas and widening a stockpile surplus in a trend that might last through March.
Temperatures since Dec. 1 have been above average from Minneapolis to Boston, the part of the United States that uses the most energy to heat homes and businesses. The region includes three of the biggest cities, New York, Chicago and Philadelphia.
Gas prices have declined 13 percent from a Nov. 23 peak as a second consecutive winter of higher-than-usual temperatures reduced fuel demand. Mild weather and increased production caused the surplus in the five-year average to balloon to 12.2 percent in the last week of January from 4.6 percent at the end of November, according to government data.
“We have about 40 percent of the heating market left in the season,” said Teri Viswanath, director of commodities strategy at BNP Paribas in New York. “At this point, we need to see really strong persistence in the cold.”
The number of heating-degree days — a measure of energy demand based on how low temperatures fall — accumulated in New York from Dec. 1 to Jan. 31 was 1,638, which was 218 fewer than normal, based on a 30-year average compiled by the National Weather Service. The higher the total, the more fuel is needed to heat homes and businesses. New York’s heating-degree days value for the period last winter was 1,516.
About half of U.S. homes use natural gas for heating.
The third week of January is usually the coldest of the season. Temperatures this winter have been just a little below last year’s, which was the fourth-warmest on record in the contiguous United States, said Matt Rogers, president of Commodity Weather in Bethesda, Md.
“We have definitely had stronger cold spikes this year versus last year, but the warm periods have still dominated,” Rogers said in an email.
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