With plenty of new gas-fired generation firing up this summer, Houston-based Purvin & Gertz, an international energy consulting firm, is expecting prices to firm up, particularly in the U.S. Gulf Coast region with the average bidweek delivered-to-pipeline prices predicted to average $4.80/MMBtu in August, dropping in September and then peaking at $6/MMBtu in December.

In the Midcontinent, Purvin & Gertz predicts prices will reach $4.65/MMBtu in August, drop 10 cents a month later and then peak at $5.80 by December. While in the Rocky Mountains, the forecast is for prices to be $4.40/MMBtu by the end of August and then jump to $5.80 by the end of the year.

May’s lower prices are a reaction to the steady stream of weekly 100+ Bcf storage injections reported by the American Gas Association (see Daily GPI, May 30). Typical injection rates, the firm noted, are 70-75 Bcf/week. The rapid increase in storage levels has resulted from rising gas production rates and the decline in gas consumption from the industrial and electric utility sectors. That demand drop was attributed to the shift from gas to other types of fuel. For more information on the study, visit the web site at www.purvingertz.com or call (713) 236-0318.

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