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Natural gas inventories still tight

/ Source: The Associated Press

U.S. inventories of natural gas have grown at a brisk pace in recent weeks, but remain below the ideal level for the winter heating season and could be “problematic” if there is a harsh cold snap, the Bush administration said Thursday.

A TOTAL OF 2.7 trillion cubic feet (Tcf) of natural gas is now in U.S. inventories, according to data released Thursday by the Energy Information Administration. That is about 3 percent below the five-year average of stocks for this time of year.

“This is still short of where we would like to be and an unusually cold winter could be problematic, but significant progress (in building inventories) has taken place in a very short time,” Energy Secretary Spencer Abraham said. His remarks were part of a prepared speech for delivery at a meeting of the National Petroleum Council on the longtime outlook for U.S. natural gas supplies.

Due to unusually cold temperatures last winter, the United States had just 696 billion cubic feet of natural gas left in inventory at the end of March, sharply below average.

U.S. demand for natural gas peaks during the winter heating season from October through March.

Earlier this month, the Energy Information Administration forecast that Americans using natural gas to warm their homes will see their winter bill rise by about 8 percent from last year.

The average price of natural gas paid by residential customers this winter will be $9.41 per thousand cubic feet, up from $8.37 per mcf last year, EIA says.

U.S. demand for natural gas has been rising steadily during the past decade, outstripping new domestic production. By 2025, U.S. demand is forecast at 35 trillion cubic feet, up from 23 Tcf last year, according to Energy Department statistics.

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