Natural gas price free-fall can’t be good for North Texas

On January 26, 2012 — No comments

North Texas has seen the bright days of peak natural gas prices and the drilling boom that came with them.

Twice since Barnett Shale drilling took off in earnest, prices for near-month natural gas futures contracts on the New York Mercantile Exchange have soared. They settled at more than $15 per million British thermal units — about a thousand cubic feet (mcf) of gas — in late 2005 and at more than $13 in mid-2008.

Now it looks like we may see how dark the valley can be. Prices, already depressed from the $4-and-change they held through much of last year, have dipped below $2.50 this week and hit lows not seen in a decade.

On Thursday, the February contract settled at $2.32, down 15 cents for the day and about half its price a year ago.

What’s more, prices aren’t expected to climb any time soon, at least not for the rest of this year. While some of the recent drop is blamed on an unusually warm start to winter in the Northeastern U.S. — meaning a significant portion of the country has not yet kicked up its thermostats to burn more gas for heating — other factors are also at work to keep prices down.

For the rest of the story visit, Natural gas price free-fall can’t be good for North Texas