Energy supply inventories in good shape for coming winter

    CALGARY, Oct. 30 /CNW/ - Even if there is a cold winter ahead, high
storage levels of natural gas will be more than adequate to meet heating
demand, according to the National Energy Board (NEB) winter outlook for
Canada's energy markets, presented today. The outlook highlighted how storage
supplies, extreme weather conditions, and geopolitical events can impact
energy prices over the coming winter.
    The price of crude oil will likely remain high throughout the winter, in
the US$75 - 80 per barrel range. There is a continued rising price risk due to
tightening supply inventories. The price for heating oil should track
similarly to the price of crude oil. The NEB says that heating oil inventories
are adequate for this winter.
    "Energy price volatility is the only certainty," said National Energy
Board Chair Gaétan Caron. "We can never know for sure whether it will be a
cold winter, or what events may occur in the world," he added.
    Natural gas futures prices in North America are expected to hold steady
between US$6.00 - 8.00/ MMBtu (million British thermal units). If the winter
is exceptionally cold, the price could rise outside of that range. Stronger
production in the U.S. and imported liquefied natural gas (LNG) will offset
production decreases currently occurring in Canada.
    Canada's provinces and territories should have sufficient electricity
supply to meet winter demand loads, unless they encounter extreme weather
events or unplanned outages on their electricity grids. Most of the provinces'
grids reach peak electricity use in the winter months. The provinces that
generate most of their electricity from hydro (Québec, British Columbia, and
Manitoba) have increased water levels behind their hydroelectric dams in
anticipation of high electricity use for winter heating.
    Geopolitical events are always a factor in energy price outlooks. In
mid-October, oil prices crested to new record highs driven by a combination of
market speculation, middle east political tensions, the low U.S. dollar, and
persistent refinery bottlenecks. The Organization of the Petroleum Exporting
Countries (OPEC) agreed in September to raise its supply output by 500,000
barrels per day, starting in November 2007. This supply increase should help
to moderate recent high oil prices.
    Despite high crude oil prices, Canadian consumers are not likely to see
high prices at the gas pumps until Spring 2008, as the high driving season,
April 1 to Labour Day, increases demand for gas.

    The NEB is an independent federal agency that regulates several parts of
Canada's energy industry. The NEB's purpose is to promote safety and security,
environmental protection and efficient energy infrastructure and markets in
the Canadian public interest, within the mandate set by Parliament in the
regulation of pipelines, energy development and trade. 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, a fact sheet and the Winter Energy Outlook
presentation are available on the Board's Internet site at
under What's New!

For further information:

For further information: Andrew Cameron (,
Communications Officer, Telephone: (403) 299-3930

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