FarmWeek -
[Cached Version]
Published on: 6/15/2006
Last Visited: 9/21/2006
However, with demand for natural gas expected to increase, the projected price relief may be short-lived, according to Margot Anderson, analyst with DOE's Energy Information Administration (EIA).
EIA recently forecast natural gas prices this summer could drop to less than $7 per million cubic feet after prices topped out in December at $13.44.
"We are predicting natural gas prices likely will come down a bit over these coming months," Anderson recently told Illinois Agribusiness Roundtable members in Bloomington.
Anderson said the prediction was based on the fact that a "relatively mild winter" reduced the demand for natural gas for home heating and the prediction of a cooler summer likewise would reduce the use of natural gas-based cooling.
Residential consumption of natural gas was projected to decrease 6 percent this year, compared to 2005 levels, before increasing 7.7 percent in 2007.
"We are anticipating natural gas prices (in 2007) to go back up to where they were in 2005," Anderson said.
...
Anderson said the projected increase next year in natural gas prices is based on expected use and a "propping up effect" caused by high petroleum prices.