Domestically, natural gas remains cheap, hovering around $3.50 per thousand cubic feet (Mcf). But in Europe and Asia, respectively, prices are three to nearly five times that amount.
The current glut of natural gas in the U.S. has kept prices low for both consumers’ electricity bills and for energy-intensive areas of the economy, such as the revitalized domestic manufacturing sector, which uses natural gas for feedstock. But over the last couple of years, gas companies have been losing money because supply has outpaced demand and returns on natural gas at its domestic price became too low to warrant the cost of production.
Exporting LNG to the highest bidder overseas would greatly benefit the profits of gas companies and also some companies involved in its export. But many experts agree, and multiple studies reveal, that it would have the dual effect of raising prices domestically to levels that would both hurt consumers and all other energy-intensive sectors of the economy.
“If we are forced to pay $12 to $16 per Mcf, well, then our economy’s going bust,” Patzek said.
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