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Separate Paths – Part 2

By Avalon Energy Services | Apr 18, 2016 | Comments Off on Separate Paths – Part 2

By Ana Rasmussen, Intern Our last blog post Separate Paths – Part 1looked at how electricity distribution costs have been rising since 2008 and many of our readers have had questions about just why this is happening. In order to explore this, and to try to get some answers, I dove in and analyzed seven…

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Separate Paths – Part 1

By Avalon Energy Services | Mar 8, 2016 | Comments Off on Separate Paths – Part 1

By Ana Rasmussen, Intern Since the shale boom began in earnest during 2008, natural gas prices in the US wholesale market have fallen dramatically. Prices have hovered within the 2 to 6 dollar per million Btu (mmBtu) range over the last few years, with the prompt month NYMEX natural gas contract trading at a remarkably…

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Natural Gas and Electricity Are Parting Ways – Part 2

By Avalon Energy Services | Dec 8, 2015 | Comments Off on Natural Gas and Electricity Are Parting Ways – Part 2

In our last article, Natural Gas and Electricity Are Parting Ways – Part 1, we explored the weakening correlation between wholesale natural gas prices and electricity prices in the Mid-Atlantic. While natural gas prices have fallen dramatically over the past seven years, and electricity prices have fallen as well, electricity prices have not fallen as…

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Natural Gas and Electricity Are Parting Ways – Part 1

By Avalon Energy Services | Nov 9, 2015 | Comments Off on Natural Gas and Electricity Are Parting Ways – Part 1

In recent articles, we have explored the dramatic decline in natural gas prices over the past seven years. See These Are Days To Remember and10,000 Maniacs Were Right. In the US Mid-Atlantic, natural gas and electricity prices have, over time, tended to move together. While there has by no means been a perfect correlation between…

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10,000 Maniacs Were Right

By Avalon Energy Services | Oct 29, 2015 |

The dramatic decline of natural gas prices was the focus of our last article (These Are Days to Remember). As we noted then, in real dollars, natural gas prices were near all-time lows. Since then, natural gas prices have continued to fall. Yesterday the November futures contract settled at $2.033 per mmBtu. The last time…

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These Are Days To Remember

By Avalon Energy Services | Oct 13, 2015 | Comments Off on These Are Days To Remember

Natural gas prices are really, really low in the wholesale market. The graph above shows daily natural gas prices traded at the Henry Hub, in dollars per million British thermal units ($/mmBtu), from January 1997 to today. Prices on the graph are in nominal dollars, not adjusted for inflation. Natural gas prices have exhibited a…

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Peak Oil

By Avalon Energy Services | May 20, 2015 | Comments Off on Peak Oil

Concerns and worry about Peak Oil are overstated and irrelevant. Many articles and books have been written on the topic and many lectures given. Dire predictions have been made and many people have concluded that because of peaking of crude oil production, the future of the human race is bleak. Peak Oil theory seems so…

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Three Years Ago

By Avalon Energy Services | Apr 13, 2015 | Comments Off on Three Years Ago

Just about three years ago, on April 19, 2012, the prompt-month (see Note 1) natural gas futures contract closed at $1.91 per mmBtu, a twelve year low. On April 9, 2015, the prompt-month contract closed at $2.53 per mmBtu. Are natural gas prices higher now, in April 2015, than they were in April 2012? The…

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Urban Oilfield

By Avalon Energy Services | Mar 5, 2015 | Comments Off on Urban Oilfield

Los Angeles is an urban oilfield. Within its limits are more than 50 oil fields, 3,000 active oil wells, and numerous tar pits (actually asphalt seeps). During the 1920s, a quarter of the world’s crude oil production came from California, and the Los Angeles Basin was responsible for a large portion of that production. It…

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