IA Ag Official: Natural Gas Prices Up, Propane Steady
Date posted - July 6, 2016
Iowa Department of Agriculture fuels analyst, Harold Hommes, says the cost of the most popular fuel used to heat homes in Iowa has jumped up by around one dollar in the last few months. Hommes says the move up in price of natural gas is easier to take after the cost bottomed out.
Hommes says you can still benefit from lower natural gas prices in the summer season, since it’s used for a lot of products.
He says if natural gas prices continue to move up, it doesn’t necessarily mean you’ll see an increase in price from the utilities when it’s time to turn on the furnace.
Hommes says the cost of another heating fuel, namely propane, is likely to remain steady heading into fall.
Given the market impacts of supply and demand, Hommes says our supply is exceptionally high and the demand is very low during the summer months.
A few things could change the picture, he says, like a long-range forecast that calls for a bitter cold winter, or if there’s an increased demand for propane by farmers this fall to dry their crops. Still, Hommes predicts there will be no significant propane price spikes in the coming months.
He predicts a repeat in the winter ahead. In January of 2014, Iowa hit a record high for propane at just over five dollars a gallon, while prices now are about one-fifth that. It’s estimated 67 percent of Iowans use natural gas to heat their homes, 15 percent use electricity, 14 percent use liquid propane.