The winter system that has sent much of the United States into a deep freeze in recent days has also sent prices soaring for the natural gas that about half of Americans use to heat their homes. But don’t worry too much about a dramatic spike in your next heating bill: since warmer weather is forecast soon and many utilities buy gas in the futures market, the impact on customers is expected to be limited.
Next-day delivery prices at a natural gas hub feeding into New York City hit $90 per million British thermal unites (mmBTU) Monday before dropping Tuesday to $28.33/mmBTU.
The price spike Monday was caused by utilities looking to secure supplies of the heating fuel before temperatures plummeted on the East Coast Tuesday, the Wall Street Journal reports.
Because many utilities buy natural gas on the futures market in order to stabilize supply, the impact on the customers’ pocket books should be limited, but, according to the Energy Information Administration, the cold spell has also led to elevated power prices in both New York and New England.