Toledo Regional Chamber of Commerce : Energy Market Update

Electric: Power prices had seen a strong run up since the third week in December due to the winter season finally showing up. However, it now appears as though traders have eased off that initial shock as monthly forecasts have taken a step back from the suddenly frigid temperatures we've recently experienced. Wholesale pricing movements may prove to be extremely volatile over the coming months but as long as storage levels remain well above historical averages, highly competitive rates should exist for consumers to explore the potential cost savings that are available.

Gas:Speculators in the natural gas market weren't exactly sure how prices would react to the large withdrawal amounts that reports had indicated would be taken from underground storage over the next few EIA reports released on Thursdays. We received our first inclination this week of how psychologically important it is for the market to not forget about the excess amount currently in storage relative to the norm for the middle of January. Current end of winter storage projections have us at +650 BCF compared to the five year average, or in other words, a major cushion. The supply/demand balance will continue to influence the volatility of price swings in the market, along with how much coal to gas switching takes place while prices are suppressed. The front month February contract recently traded around $2.10 as of January 15.

If you would like Chamber Energy Solutions to review your electric and natural gas bills, please contact the Chamber or your CES consultant.