CALGARY, Nov. 17, 2011 /CNW/ - Despite uncertainty in energy pricing,
Canadians can warm up to adequate energy market supplies this winter,
the National Energy Board (NEB or Board) said in its latest Winter
The world economic outlook is the primary uncertainty for energy prices
this winter. Sovereign debt concerns in Europe and the United States,
coupled with lower expectations for global economic growth present
significant market challenges.
Weather could have a significant impact on prices this winter, with
colder than normal conditions predicted in most of Canada. If these
predictions are correct, there will be a higher demand for heating oil,
natural gas, and electricity.
Geopolitical instability in Libya, Iran and the Middle East in general
is creating energy supply concerns. However, North America's energy
markets are generally well-supplied.
Crude oil prices are expected to average between US $85 and $95 per
barrel. World oil markets are currently tight, with total commercial
petroleum products and crude oil stocks in the three major markets of
Japan, the United States and Europe near five-year lows. After
geopolitical unrest drove oil prices to a post-recession high last
spring, growing concern over the global economy has had a moderating
effect. Seasonal demand growth may counterbalance those effects through
the winter period.
With the price of home heating oil closely tracking the price of crude
oil, average home heating prices this winter are expected to rise
slightly, averaging between $1.00 and $1.20 per litre. U.S. distillate
inventories are above the five-year average, indicating that markets
will be well-supplied as winter begins.
Steady natural gas production levels in North America are meeting slight
increases in demand, keeping natural gas prices consistent with last
year's, at an average of $3.75 to $4.25 per MMBtu this winter. The
potential for cold weather to disrupt gas supply remains an upward
price pressure, as does increased demand in industrial use and
Canadians can expect electricity prices to be slightly higher than
average this winter. Domestic electricity markets have adequate supply,
and exports are at a multi-year-high, thanks in part to higher than
normal precipitation levels across Canada this year, which heightened
hydroelectric production. The prices in the two Canadian wholesale
markets are expected to settle at significantly different levels.
Alberta's market is tight, with power demand increasing from the oil
sands, expanding population base and economic activity. Ontario's
demand has declined in 2011, with slightly slower-than-expected
The NEB is an independent federal regulator of several parts of Canada's
energy industry. Its purpose is to regulate pipelines, energy
development and trade in the Canadian public interest. As part of its
mandate, the NEB monitors the supply of all energy commodities in
Canada and reports its findings. The NEB Internet site is regularly
updated with new energy information for the Canadian public.
This news release is available on the NEB's Internet site at
www.neb-one.gc.ca under What's New!
SOURCE National Energy Board
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