Cold Weather Shocks Natural Gas Prices

4 Jan 2018   Prices, Shale Gas

The effect is twofold: extreme cold is actually cutting production, while demand is surging because everyone is turning up the thermostat to stay warm. First the supply side. There are reports that in North Dakota’s Bakken, for instance, cold weather is cutting into production. Reuters reports that gas output in the Bakken is down more than 20 percent since last month. Citing Genscape data, Reuters said that gas flowing through interstate pipelines from North Dakota dropped from 1.3 billion cubic feet per day (bcf/d) in the week ending on December 25 to just 1 bcf/d as of Tuesday. Some of that decline could be consumed within North Dakota, but the drop-off is probably too significant not to be related to production problems. “That drop is due to the freeze off we’re seeing,” said Andrew Bradford of BTU Analytics, according to Reuters. Texas (-20 percent) Oklahoma (-22 percent) and Pennsylvania […]

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