Free Republic

Record-high natural gas prices are prompting more utilities to switch from gas to oil derivatives, fanning the flames of an already strong oil price rally. Yet, another report, also by Reuters, said that other analysts expected a lot of gas-to-oil switching this winter, which would drive oil prices higher and drive some UK energy suppliers out of business. "This has never happened before at such a global scale. The market has always tried to substitute from costly oil to much cheaper natural gas," Reuters quoted a SEB commodity analyst as saying. Now the tables have turned, and both commodities are...

Natural gas spot prices in 2015 at the Henry Hub in Louisiana, a national benchmark, averaged $2.61 per million British thermal unit (MMBtu), the lowest annual average level since 1999. Daily prices fell below $2/MMBtu this year for the first time since 2012. Henry Hub spot prices began the year relatively low and fell throughout 2015, as production and storage inventories hit record levels and fourth-quarter temperatures were much warmer than normal. Natural gas prices at key regional trading hubs ended the year lower than their starting point. At northeastern locations, where natural gas transmission infrastructure is often constrained, prices...