Is This the Beginning of the End for Cheap Shale Gas? - CoBank Site

Is This the Beginning of the End for Cheap Shale Gas?

April 19, 2023

Key Points

U.S. natural gas futures prices have fallen sharply since the start of the year, with 2023 setting up to be one of the most bearish years in recent history. However, longer term, the stage is set for tighter balances, rising prices and increased volatility.
More exports, less opportunities for fuel-switching and supply bottlenecks could all contribute to rising energy bills.
What’s more, phasing out and possibly underfunding transition assets too early may result in greater price swings, raising security and affordability concerns.
To buffer against rising prices, wholesale consumers should reconsider financial hedging but also incorporate adequate physical supply contracts to reinforce deliverability and reliability – in other words, an old school approach to a new set of problems.

Disclaimer: The information provided in this report is not intended to be investment, tax, or legal advice and should not be relied upon by recipients for such purposes. The information contained in this report has been compiled from what CoBank regards as reliable sources. However, CoBank does not make any representation or warranty regarding the content, and disclaims any responsibility for the information, materials, third-party opinions, and data included in this report. In no event will CoBank be liable for any decision made or actions taken by any person or persons relying on the information contained in this report.

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