Forecast Calls For Wild, Cold Winter
“Numb’s the word.”
That’s the forecast for the upcoming winter season by the 192-year-old Farmers’ Almanac. In its latest forecast, the venerable publication is predicting colder temperatures than normal for most of the U.S. For the natural gas industry, that could mean an increase strain on supply as power companies work to keep the country warm — and with that, a possible upward trend in gas prices.
According to the Energy Information Administration, the Henry Hub natural gas spot price averaged $7.17 per thousand cubic feet in 2007 and is expected to average $10 per Mcf in 2008 and $9 per Mcf in 2009.
Residential heating oil prices during the upcoming heating season (October though March) are projected to average $4.34 per gallon compared with $3.31 during the last heating season, an increase of about 31%. Residential natural gas prices over the same period are projected to average $15.58 per Mcf compared with $12.72 per Mcf, during the last heating season, an increase of about 22%.
Almanac editor Peter Geiger says at least two-thirds of the country can expect colder-than-average temperatures this winter, with only the Far West and Southeast in line for near-normal readings.
“This is going to be catastrophic for millions of people,” Geiger says. The almanac claims an 80% to 85% accuracy rating in its forecasts.
The usually wet Pacific Northwest could be a bit drier than normal in February.
Looking ahead to summer, the almanac foresees near-normal temperatures in most places. But much of the Southwest should prepare for unusually hot weather in June and July, while Florida, Georgia and the Carolinas will get oppressive July heat and humidity.
And of course, what would a forecast for the upcoming winter be without a little controversy.
The National Weather Service’s trends-based outlook calls for warmer than normal weather this winter over much of the country, including Alaska, said Ed O’Lenic, chief of the operations branch at NOAA’s Climate Prediction Center. The almanac and the weather service are in sync, however, in pointing to a chance of a drier winter in the Northwest.
Who to believe?
Stay tuned. More to come. The best for the upcoming winter–hope for the best and prepare for the worst. The news is filled with people recommending folks begin saving money now so they can pay their utility bills in the dead of winter. There’s no easy answers to this one.
Just be prepared.
–John A. Sullivan, News Editor, Oil and Gas Investor, www.OilandGasInvestor.com, jsullivan@hartenergy.com
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