Slide 6 of 30
- In an era of regulation and scarcity the inflation-adjusted natural gas wellhead prices increased about 187 percent by 1997, from $0.57 to $2.15.
- In 1954 the Federal Power Commission (now the Federal Energy Regulatory Commission) set controls on wellhead prices for gas intended for interstate transmission to consumers.
- Beginning in 1980, interstate transmission of new gas (not under existing long-term contract) was decontrolled while interstate transmission of old gas (under existing long-term contracts) remained controlled. All gas was decontrolled in 1993.
- Once the marginal supply of interstate transmission of gas was decontrolled, the average wellhead price of new gas rose, prompting a boom in gas exploration and development.
- Average wellhead prices peaked in the early 1980's as more gas entered the market. Gas prices are now strongly seasonal, increasing in winter and falling in summer.
Source: Energy Information Administration, Annual Energy Review 1997, DOE/EIA- 0384(97). (Washington, DC, July 1998), Table 6.8.
