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Natural Gas Prices Show Expensive Winter Heating Bills

Natural Gas futures are holding above a seven-year high, and supplies are diminishing, with tropical storm Nicholas on the horizon and the effects of Hurricane Ida still affecting gasoline prices. In means that heating bills in the United States could be the highest, they’ve been in years this fall and Winter. Delayed recovery from the disaster, global supply constraints, and terrible energy policy could combine to create a natural gas nightmare before Christmas.

Natural gas is one of the most popular sources of energy in the United States, not just for electricity and manufacturing but also for heating people’s homes. Over half of all houses in the United States are heated by natural gas. Yet, even those who use electric heat pay for natural gas price hikes via the backdoor because electricity accounts for 38% of total natural gas usage in the United States.

Hurricane Ida not only wiped out 90% of natural gas output but also wreaked havoc on crucial onshore staging regions, causing natural gas production to take longer than ever to recover. As a result, over 78 percent of natural gas production in the Gulf of Mexico is still shut down, with no precise date for when things will go back to normal.

On the natural gas side of the equation, the recovery is one of the slowest in history, even worse than Hurricane Katrina in 2005. That’s awful news, and it comes at a poor time since this is the time of year when the US needs to create stockpiles so that we can get through the Winter.. Unfortunately, the way the natural gas market operates is similar to how squirrels work.

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