US to see winter spike in natural gas prices
Natural gas bills are set to increase in all regions of the US this winter, with surging demand and colder temperatures potentially forcing Americans to pay nearly 30% more over the previous year, according to projections by the US Department of Energy.
A forecast published by the department’s Energy Information Agency (EIA) on Monday predicted a significant price hike over the winter months, suggesting some households will pay an average of $931 for heating during the cold season – a 28% increase over 2021. Nearly half of all American homes are heated with natural gas.
The agency went on to note that the Midwest will see the greatest increase in retail gas prices compared to other regions, though the South, West, and Northeast will also experience climbing costs.
While comparatively colder temperatures are expected to contribute to the rising prices, the EIA previously said growing “constraints on liquefied natural gas (LNG) exports to Europe from Russia” were creating “strong international demand” for American gas. The resulting boost in US exports has used “almost all” of the country’s available gas capacity and driven prices upward, with the US reporting its lowest natural gas storage levels in three years last April.
Efforts by some European states to curtail Russian energy imports in retaliation for the conflict in Ukraine have also prompted fears that residents will be unable to heat their homes come winter. In comments to the Wall Street Journal on Sunday, Italian Energy Minister Roberto Cingolani warned that the coming months could be “dominated by fear and uncertainty,” observing that “the real problem isn’t shortage but pricing.”
“Citizens may be unable to pay their bills and businesses risk closing down,” he said, while expressing hope that the continent will “get through the winter fine,” barring any “catastrophes” such as exceptionally cold weather or a major spike in energy consumption.
EU leaders are expected to meet later this week to discuss a price cap on natural gas for the bloc in an attempt to head off an energy crisis, with the European Commission reportedly planning to create a mechanism allowing it to intervene to force down prices when they surpass a “dynamic” maximum level.
