U.S. natural gas boom leads to decade low in price
BY JONATHAN FAHEY AP Energy Writer
Wednesday, April 11, 2012
NEW YORK — The price of natural gas has fallen to its lowest level in more than a decade, a remarkable decline for a commodity that not long ago was believed to be in short supply.
The country's supply of natural gas is growing so fast that analysts worry the country's underground storage facilities could reach their limits by fall.
On Wednesday, the futures price of natural gas declined to $1.987 per 1,000 cubic feet, its lowest level since January 28, 2002, when the price hit $1.91. If the price falls to $1.75, it would be the lowest since March 23, 1999.
Natural gas production has boomed across the country as energy companies employ a new drilling technique to tap previously untouched reserves. The process has raised concerns about water safety, and has been temporarily banned in New York and New Jersey. But where it has been allowed, it has led to increases in drilling, job growth and production.
The falling price of natural gas has been a boon to homes and businesses that use the fuel for heat and appliances, and for manufacturers that use it to power their factories and make chemicals, plastics and other materials.
From October to March, households spent $868 on average on natural gas, a decline of 17 percent from last winter. Those savings have helped to relieve the burden of rising gasoline prices. Households spent $1,940 on gasoline from October to March, a 7 percent increase from the same period a year ago.
There is so much natural gas being produced — and still in the ground — that drillers, policymakers, economists and natural gas customers are trying to figure out what to do with it.
PRICES AND COSTS
— Current U.S. price: $1.987 per 1,000 cubic feet
— All-time low: $1.32 Jan. 13, 1995
— All-time high: $15.38, Dec. 5, 2005
— 10-year average: $5.96
— Average price in Asia: $15.90
— Average price in Europe: $9.37
— Top 5 producers of natural gas in the U.S.: ExxonMobil, Chesapeake Energy, Anadarko Petroleum, Devon Energy, Encana
— Top 5 producing states in the U.S.: Texas, Alaska, Louisiana, Wyoming, Oklahoma
— Top 5 producing countries: U.S., Russia, Iran, Algeria, Canada