For a brief moment during the shoulder month of October natural gas prices at Henry Hub firmed as expectations of increased economic activity and the view that domestic natural gas production was finally ready to take a tumble prevailed.
It is entirely possible that either or both of those things may develop this winter. However, they may not.Recent years have demonstrated that the November-December period seems to set the tone for winter fuels expectations.
Given the relative strength in underground storage and the uncertainty still surrounding the U.S. economy, a warm start to the 2009-2010 winter heating season may very well put a lid on seasonal price volatility and offer local gas utility customers significant relief from winter bills, as was estimated by the Energy Information Administration in the October 2009 Winter Fuels Outlook. That outlook saw the potential for reductions of 12 percent in home heating costs for natural gas customers compared to the previous winter heating season.
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