Warmer than normal winter weather is responsible for significant drop in natural gas futures pricing.  Upon review of attached you’ll note big drop in futures pricing, during the month of January we experienced the biggest monthly drop in 22 years.  Natural gas production continues to be strong, longer term forecasts continue to call for warmer than average temperatures and gas in storage is at surplus over this time last year.  Tomorrow is February 1st, two winter heating months are behind us with no concern for sustained significant cold weather during first ten days of February.  Best of winter is behind us.

Worthwhile to note that Europe is also experiencing mild conditions resulting in major slowdown of U.S. exports of liquefied natural gas.  We have plenty of gas.

Now is the time to consider locking in your natural gas supply for the coming years.  The collapse in pricing is “miraculous” to say the least especially when you consider (see attachment) where we stood in September.  Dodged a bullet as they say however, given state of the world and fact that we’re dealing with a commodity that can turn on a dime, locking in through at least 2025 is advisable.

Regarding electricity, fixed pricing remains high however we are seeing some progress in lower pricing.  Current thinking, for variety of reasons, is to lock in your electricity no later than April/May timeframe.  Volatile best describes the electricity market, will continue to be so, locking in removes this concern.

Please contact me anytime.

Regards,
John Thomas
Upstate Utilities
2592 Western Ave., Suite 201
Altamont, NY  12009
518-225-8098 Cell
518-391-2370 Fax