While the price of gasoline continues to go up the cost of natural gas has gone in the other direction. Harold Hommes with the Iowa Department of Agriculture says natural gas hit it’s lowest mark in ten years.
“We broke the magic two-dollar-a-million-metric-therm mark this past week,” Hommes says. “By and large it’s just because of very abundant supplies, we keep finding new sources of the fuel. New technologies have certainly helped in that process, but right now we abundant supplies of the fuel and it seems every time we have a new analysis, it seems the numbers keep growing.”
Winter is over and people won’t be using as much natural gas to heat their homes. But Hommes says that doesn’t figure into the downward spiral in natural gas prices. “This is not a little blurb where because we’ve gotten through the winter heating season prices are falling. We’ve seen it pretty much as a long-term trend,” Hommes says.
The Ag Department’s fuel price report shows the price of natural gas is down over 50% compared to last year and down just over 72% from five years ago. Natural gas is the top fuel used to heat homes in Iowa, so that longer term downward trend is good news looking ahead to next winter.
Hommes says the drop has some good consequences right now as it helps the bottom line for businesses that rely on the fuel.”It does lower their costs, it lowers our costs as consumers, and I think that a lot of the big utilities, users of natural gas will be locking in contractually for their supplies at these lower levels, and it certainly bodes well for everyone,” Hommes says.
He says more and more businesses are using or looking at using natural gas to power vehicles to take advantage of the savings over gasoline and diesel fuel.