Natural Gas Prices for April Rise 5.7% Nationwide, as Spring Arrives With a Chill, According to Platts.

Business Editors

WASHINGTON--(BUSINESS WIRE)--April 6, 2001

Average monthly natural-gas spot prices for April rose 5.7% nationwide, as a late-season blast of chilly weather forced buyers in many markets back into the spot market to satisfy heating loads, according to data released by Platts, the energy market information division of The McGraw-Hill Companies (NYSE: MHP).

The uptick follows a 21% drop last month for March contracts. April's $5.23/MMBtu average spot price for supply areas nationwide was up from $4.95 in March and 86% above the April 2000 average of $2.81.

In an exclusive survey by Inside FERC's Gas Market Report, whose spot price surveys set the benchmark prices for most monthly spot contracts in North America, the average price of natural gas delivered to the high-cost New York and New Jersey markets for April 2001 rose 4.1%, to $5.86/MMBtu from $5.63 in March 2001. This month's average is 87% higher than the April 2000 average of $3.13/MMBtu.

In Southern California, where demand for gas from the troubled electric generation sector continues to keep spot prices well above other market areas, the average monthly spot price for April declined slightly to $12.51/MMBtu from $12.53 in March. Spot prices there are 314% higher than in April 2000 when the average was $3.02.

"The brief spate of cold across much of the U.S. last week put upward pressure on prices at the tail-end of the heating season," said Kelley Doolan, natural gas market specialist for Platts and chief editor of Inside FERC's Gas Market Report. "Prices rose because the supply/demand balance is still so tight. And there is a feeling in the marketplace that spot-gas prices will remain relatively strong going into the summer, as gas utilities and others buy gas to inject into storage caverns in preparation for next winter."

"There is also considerable speculation that spot-gas prices could rise this summer to levels that rival or even surpass the peaks seen this winter," Doolan said. "As the summer heats up, many expect the electric generators to come into the gas market in force and compete for the limited supplies. How high prices go then will depend in large part on how hot it gets and for how long," Doolan said.

Platts is the world's largest and most authoritative provider of energy market information, with more than 325 professionals worldwide and products ranging from real-time and Internet-based news services, to market reports, databases, magazines and conferences. Platts services cover the oil, petrochemical, natural gas, electricity, nuclear power, coal and metals markets. Every day more than $10 billion of trading activity and term contract sales are based on Platts' price assessments. Additional information is available at www.platts.com and www.plattsmetals.com.

Founded in 1888, The McGraw-Hill Companies is a global information services provider meeting worldwide needs in financial services, education and business-to-business information through leading brands such as Standard & Poor's, BusinessWeek and McGraw-Hill Education. The Corporation has more than 300 offices in 32 countries. Sales in 2000 were $4.3 billion. Additional information is available at http://www.mcgraw-hill.com.