The Seasonality of Natural Gas—and When To Shop

The natural gas market is often described as volatile, meaning prices can shift up or down depending on a range of factors. But it’s also true that this clean-burning source of fuel comes with a degree of predictability, especially when we consider the seasonality of natural gas.

What is natural gas seasonality?

This refers to the predictable fluctuations in natural gas demand, supply and prices that we see throughout the year due to weather conditions and patterns of use—read more about factors affecting natural gas prices in our blog on Understanding the NYMEX.

In winter, heating demands go up in homes and businesses, which reduces supply and typically results in higher prices. As the weather warms up a bit in spring, demand drops, prices begin to decrease or stabilize, and producers begin to inject more fuel into storage to prepare for winter that’s still a few months away.

In summer, however, despite the lack of homes and businesses heating directly with natural gas, demand typically rises, as it’s the No. 1 source of fuel used by U.S. power plants to generate electricity. During the hottest months of the year, electricity use can jump by as much as 40% in some areas of the country as people try to keep cool. Natural gas storage injections usually persist throughout summer, though sometimes at a slower pace.

In the fall, when the leaves start to change color and outside temperatures begin to cool slightly, demand once again drops for a few short months, and storage injections reach their highest levels.

When are natural gas prices lowest?

Natural gas prices are usually the lowest for both homes and businesses during late spring (April to May) and early fall (Sept. to Oct.). These periods are when demand is at its lowest and when there are fewer weather disruptions and price spikes. Providers often offer their most competitive gas prices during these periods, and so they’re typically the best times to lock in a great natural gas rate.

What should I consider when shopping for natural gas?

Although price is often the top driver when looking for a natural gas provider, there are other factors to think about. Some companies offer a great rate at the start but roll you onto higher rate a few months down the road. It’s a common tactic, so be sure to read the fine print. You might also consider a company’s rating and level of service, if that’s important to you, or whether they give back to the community. For more on this topic, check out our informative blog on Shopping for Natural Gas.

We hope this blog was informative. As Georgia’s highest-rated natural gas provider, Gas South wants you to get the great natural gas savings and service you deserve—it’s just part of what it means to Be A Fuel For Good®.