On February 1, the natural gas spot price at the Henry Hub had risen 21 cents from last week, or 2.5 percent, to $8.71 per million British thermal units (mmBtu). Falling temperatures and rising crude oil prices contributed to the price increase this week. This Wednesday's price of $8.71 was $2.42, or 38 percent, above last year's level of $6.29. From week to week natural gas prices have fluctuated, but overall, prices have been falling since their peak on December 13, 2005, at $15.40 per mmBtu. This winter's mild temperatures have contributed to the pattern of declining natural gas prices.
Shut-in natural gas production in the Gulf of Mexico was 1.656 billion cubic feet per day as of Wednesday, January 25, from its level on January 11 of 1.805 billion cubic feet per day.
The amount of natural gas in storage in the East Region decreased 3.9 percent to 1,349 billion cubic feet for the week ending January 27, which was 288 billion cubic feet above the 5-year average. Nebraska is a part of the East Region (see map) which is a major natural gas consumer, particularly in the residential and commercial sectors. The industrial sector, which includes agriculture, is also a major consumer in this state. Most of the gas is supplied from the Producing Region with a fair amount imported from Canada. The Henry Hub in southern Louisiana is a major market center with interconnections for many of the pipelines that transport U.S.-produced gas to the East Region. Furthermore, the Henry Hub is the preferred reference point for prices for most of the domestic gas destined for the East. Therefore, market conditions and developments in the East Region and price movements and trends at the Henry Hub are usually highly correlated.
Notes: An archive is available. Divide the price by ten (10) to obtain the price per hundred cubic feet (ccf) or the approximate price per therm.