News / Science & Technology
Energy Solutions, Inc. – Natural Gas Experts Not Worried Over Grim Hurricane Season Forecast
Growth in onshore natural gas supplies expected to reduce hurricane-related price impacts.
The Atlantic-basin tropical storm season officially runs from June 1 through November 30. With more onshore production, concerns over hurricane-related disruptions are reduced. In 2001, for example, 23 percent of the nation’s natural gas supplies originated in the Gulf of Mexico, whereas today, that number is only 8 percent.
Meteorologists already predict that this year the storms that do occur will create more trouble than usual. The Colorado State University (CSU) team says there is a 72 percent chance that one major hurricane (Saffir/Simpson category 3-4-5) with sustained winds of 111 mph will make landfall along the U.S. coastline. This is up over a historical average of just 52 percent. CSU also says that there is a 48 percent chance (compared to a 31 percent average) that a major hurricane will hit the East Coast, including peninsular Florida, and a 47 percent chance (as opposed to a 30 percent average) that a major hurricane will make landfall on the Gulf Coast from the Florida Panhandle west to Brownsville, Texas.
There are several factors that impact tropical storm formation. The presence of dust off of Africa indicates drier air that will hinder tropical storm development in that region. La Niña conditions, which are currently weakening, create low wind shear. (A high wind shear is more likely to break-up the formation of tropical storms.) Plus, the sea surface temperature is in a warm phase, and warm water acts as “fuel” in hurricane formation.
Energy Solutions, Inc. President, Valerie Wood, commented on the projected price impact of the 2011 hurricane season, saying, “There will likely be a rally initiated on hurricane-related fears, but that rally will be trumped by the reality of more-than-ample natural gas supplies and sluggish demand. Meanwhile, storage injections are expected to pick up substantially as the hotter weather east of the Mississippi subsides. Even though natural gas prices have risen to new 2011 highs, the longer-term fundamental outlook is still bearish for natural gas prices.”
Additional information about natural gas price trends, storage inventories, production levels, rig counts, demand issues, and much more can be found in the Monthly Edition of The Advisor. Take a FREE, no-obligation 60-day trial to The Advisor and receive the most recent Weekly Edition, as well as the upcoming Monthly Edition for June, which contains additional insight into numerous factors that affect pricing within the Natural Gas Industry. Learn more by visiting www.energysolutionsinc.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.
