Gas Prices Dropped due to Cooler Weather Forecasts

On Wednesday, natural gas prices declined and announced on September 05 a one-week low brought by cooler US weather forecasts.

Natural gas futures for October delivery decreased by -0.46% to $2.57 per metric million British thermal units on September 06.

Lower prices could hurt the fuel demand from electricity providers in running air conditioning. According to forecasters, a Canadian weather system would lead to cooler Midwest and East Coast temperatures in mid-September.

Moreover, the fuel costs continue to be weighed on by high outputs due to weak heating demand. This was driven by the milder-than-normal winter. In addition, the recent winter’s warm temperatures caused an inventory rise in Europe and the US.

On September 03, gas storage in Europe was 93.00% full, over the five-year 82.00% seasonal average for this year. Likewise, US inventories as of August 25 were 8.70% above their five-year seasonal average.

Recently, Dutch and British fuel prices plunged. High volumes and low demand helped markets disregard low Norway supply and threats of strikes at Australian LNG facilities.

In addition, high temperatures in Europe held back demand for gas. Based on analysts, weak demand would last for a while as storage interjections would increase alongside Norwegian flows.

In Norway, the commodity’s exports went lower than usual amid a series of interruptions at a significant infrastructure.

Delmarva Power Customers to See Lower Gas Prices

Delmarva Power applied for approval of lower supply charges for customers after the decline in natural gas prices.

The proposal states an 18.00% drop in charges from the current rate starting in November. Therefore, customers using an average of 56 centum cubic feet a month would see a $16.30 decrease in their bill.

However, the change in the total cost for each customer will depend on their gas usage.

As the company’s effort to reduce cost impacts, Delmarva Power stores half of the fuel needed to meet winter demand. Also, locking in prices aims to limit the effects of wholesale price volatility that could occur throughout the year.