With Supplies Plentiful, Natural Gas Prices Low; Producers Feel Pinch; A Boon for Consumers
Insulated by geography from the crisis in the Persian Gulf and by the structure of the market from panic buying on futures exchanges, the price of natural gas is hovering near its lowest point since the mid-1980s.</br></br>The rock-bottom price is bad news for producers but an economic boon for industrial and residential consumers, who have found a widening gap between the price of gas and the fast-rising price of fuel oil.</br></br>Analysts assume the price of gas will rise as usual with the onset of winter, but in the meantime, some utilities are advertising the lures of low prices and assured availability to wean residential consumers away from oil heat. The entire industry is "aggressively working to develop new markets," according to the American Gas Association.</br></br>Brian Alexander, sales director for Washington Gas Light Co., reported a "steady and persistent increase in conversions" from oil to gas.</br></br>While precise figures for industrial consumers are not available, many analysts believe the persistently low price of natural gas has induced so many to switch from fuel oil that the Energy Department's attempt to promote such "fuel switching" as a way to save oil will have little effect.