News Release No. 396

MILD WEATHER TAKES PRESSURE OFF HEATING FUELS
ACCORDING TO DEPARTMENT OF NATURAL RESOURCES

Volume 32-396

Contact: Larry Archer

(For immediate release)

573-751-3807

JEFFERSON CITY, MO, DEC. 10, 2004 -- Recent milder winter temperatures have helped to reduce the demand for natural gas and propane for space heat, according to a survey released today by the Missouri Department of Natural Resources' Energy Center.

The U.S. Department of Energy's Energy Information Administration (EIA) lowered its projection for Midwest households' average natural gas winter heating bills from an estimated 15.3 percent increase to an increase of 9.3 percent compared to last year. This is based on natural gas prices that are expected to be 7.3 percent higher than last year.

U.S. natural gas supplies were estimated at 3,211 billion cubic feet (Bcf) as of Friday, Dec. 3. U.S. supplies are currently 12 percent higher compared to the 5-year average. Natural gas for January delivery at the NYMEX closed at $6.68 per MMBtu on Dec. 8 compared to $5.58 at this time last year, the Energy Center reported in its Dec. 9 edition of the Missouri Energy Bulletin.

U.S. propane supplies are 1.8 million barrels higher compared to last year at 63.7 million barrels. Missouri's average retail price for propane was unchanged during the last week at $1.56 per gallon on Dec. 6 compared to $1.20 at this time last year, an increase of 30 percent.

EIA lowered its projection for Midwest households' average propane winter heating bills from an increase of 26 percent over last winter to 22.4 percent higher than last year. This is based on propane prices over the winter heating months averaging more than 20 percent higher than last year at $1.56 per gallon with an average consumption of 898 gallons.

The Missouri retail price for regular gasoline decreased 12 cents per gallon from last month, standing at $1.75 per gallon as of Dec. 6.

The Dec. 6 price is 43 cents higher than this time last year. Retail gasoline prices are falling throughout the United States due to improved refinery operations, stronger supplies of gasoline in storage, which stand nearly 7.6 million barrels higher compared to last year, and a decrease in consumer demand for motor gasoline.

The average retail price paid for regular unleaded gasoline in the United States was $1.91 per gallon. The agency's bimonthly fuels survey polled a selection of service stations throughout the state on the price of regular unleaded gasoline, diesel fuel, B-20 biodiesel fuel and E-85 ethanol. U.S. gasoline inventories increased for the week ending Dec. 3 and are reported at approximately 208.1 million barrels, an increase of 2.4 million barrels from the previous week. Gasoline supplies are well within the 5-year average for this time of year.

Since Nov. 4, U.S. crude oil prices have dropped at the NYMEX, settling below $50 per barrel and nearing $40 in the past week. NYMEX crude oil prices set an all-time record high price on Oct. 25 at $55.67 per barrel. That is an increase of $25.59, or 85 percent higher compared to the closing price of $30.08 for the same date last year. On Dec. 8, crude oil closed at $41.94 per barrel.

For the week ending Dec. 3, commercial crude oil stocks were up 0.6 million barrels from the previous week and up 16 million barrels compared to this time last year. With total U.S. crude oil inventories at 293.9 million barrels, crude oil continues to trend well within the 5-year supply band for this time of year, according to the bulletin.

The department's bimonthly energy bulletins are available online from the department's Web page at www.dnr.mo.gov/energy/transportation/fb.htm. The Dec. 9 Energy Bulletin is available at www.dnr.mo.gov/energy/transportation/EB120904.pdf.

For more information, contact the Missouri Department of Natural Resources' Energy Center at 573-751-3443 or the department toll free at 800-361-4827.

For news releases on the Web, visit www.dnr.mo.gov/newsrel. For a complete listing of the department's upcoming meetings, hearings and events, visit the department's online calendar at www.dnr.mo.gov/calendar/search.do.

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