News / Business
Energy Solutions, Inc. Issues Natural Gas Price Alert
Natural gas prices have fallen precipitously in the past month and buyers should not ignore this opportunity for some longer-term purchases.
The April 2010 natural gas contract on the New York Mercantile Exchange (NYMEX) hit a new low yesterday, dipping to $4.054 per MMBtu. “Price support at $4.25 per MMBtu crumbled quickly following the release of the weekly storage withdrawal report,” says Valerie Wood, President of Energy Solutions, Inc. “The Energy Information Administration (EIA) reported a withdrawal of just 11 billion cubic feet (Bcf) for the week ending March 12, 2010, a number that was considerably lower than expected.”
The rapid price movement downward prompted Energy Solutions, Inc. to issue a Pricing Alert, a timely recap of market conditions and specific recommended actions that should be taken by natural gas buyers, particularly those businesses that use a larger amount of natural gas and need to protect their budget. “A Pricing Alert is issued when something significant occurs. The front-month price move to below $4.25 per MMBtu is significant,” says Wood. “There is talk of a double-dip recession and a natural gas price move to below $4 per MMBtu, but banking entirely on something like that is risky especially when technical signals indicate that prices could rebound at any time.”
Through this Pricing Alert and The Advisor, a monthly and weekly publication, Energy Solutions, Inc. has advised its clients to make some proactive natural gas purchases particularly for the next 3-6 months. “Historically, natural gas prices move higher in the second quarter as uncertainty over the upcoming hurricane season and summer heat surface,” says Wood. “If prices rally as they have historically, it would not be surprising to see natural gas prices move back into the mid-$5’s temporarily.”
For information on this Pricing Alert or The Advisor, contact Kelly Gilboy at (608) 848-9589 or send an e-mail to kgilboy@energysolutionsinc.com. In addition, extensive insight on natural gas price moves for 2010 and 2011 are discussed in the company’s recent analysis, Natural Gas Price Outlook, which is further detailed at http://www.naturalgasoutlook.com/.
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About Energy Solutions, Inc.
Formed in 1996, Energy Solutions, Inc. is independently owned. With more than 50 years of experience in the natural gas industry, our team focuses on natural gas prices and in helping businesses improve their internal processes for the purchase of natural gas.
