It’s Winter. You Have to Get Covered Up. The Beacon, 02/22/2021

The Headline:   Last week, continued cold weather drove natural gas prices up through Q1 2022, but prices are fairly steady after that.  Short term electricity prices are likely to be up again this week, and the longer terms are still the smartest buy.  Gas storage levels are still moving down toward to the 5-year average, and next week’s report may see a record large withdrawal, driving gas storage levels below the average.   Warmer weather is on the way, but prices may continue to climb due to last week’s weather event.      

The Bottom Line:    Events last week in Texas clearly demonstrate the value of locking in energy rates, and are likely to have ripple effects on Ohio markets in the form of higher variable gas and power rates in future months.  Immediate-start contracts are going to feel much of the impact, but the longer-term contracts are still very attractively priced.   The 60-month term is still trading at only 15% above the 10-year low.  While immediate start contracts may want to wait a week to let the weather impacts unwind, we are still recommending that you lock in your electricity and natural gas rates ASAP if your contract starts any time after late 2021. 

Click HERE for more information from WFAA in Dallas on the impacts of variable rates in Texas.     

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