The period of forecasted warm weather in the United States has been extended to the first four weeks of the new year. This has driven the price of all energy commodities down.

The seasonal effect of cold weather, stronger demand for heating oil, will pull higher the whole energy complex higher.

Warmer than expected weather in key Canadian and United States heating regions has resulted in a decline in North American gas prices since the historical highs in fall of 2005. Natural gas market prices respond to supply and demand. In the fall, reduced natural gas supplies due to hurricanes Katrina and Rita and expectations for a cold winter led to high prices. Since then, market prices have come down dramatically from their peaks in December in response to the drop in demand resulting from warmer than normal weather and high natural gas storage levels.

The continuation of cool weather in the United States is expected to bring big spikes in heating fuel demand.

Now that the weather forecast has changed to predict warmer weather, the prices have come down quite significantly.

For third consecutive winter, harsh winter weather will be the main theme for eastern United States.