Monday, April 12, 2010

Price and Costs for Natural Gas

Supply and demand sets somewhat the price of gas although this commodity and energy source is very regulated. A good discussion of this is in an article by the St. Louis Federal Reserve Board as presented here from 2006:

http://www.research.stlouisfed.org/publications/review/06/11/Kliesen.pdf

For a complete analysis of these prices to January, 2010 see this:

http://www.ieca-us.com/runningout.html

It appears from the new discovery of shale gas that reserves have doubled but costs to get the gas has also increased. We should then see an increasing price trend in the future for Natural Gas.

The price today as stated in the WSJ is approximately $4 per MM BTU