Why Do Natural Gas Prices Fluctuate So Much?
Natural Gas Supply and Demand Vary Throughout the Year Natural gas is injected into pipelines every day and transported to millions of consumers all over the country. Virtually all the gas comes from either domestic gas well production, imports, or withdrawals from storage facilities. During the summer, domestic gas well production and imported gas can more than satisfy customer demand, and excess supplies are placed into storage facilities. In the winter, demand for gas generally exceeds production and import capabilities, so withdrawals from storage are used to provide the extra gas needed to meet customer requirements. Prices and Levels of Service Vary Among Customer Groups Natural gas is consumed by residential, commercial, industrial and electric utility customers. Residential and small commercial customers use gas in relatively small quantities (primarily for space heating and cooking). They tend to pay the highest prices per unit of gas but generally enjoy uninterrupted service.
