What are we waiting for? Energy managers take control of energy use.(Editorial)

A recent announcement that crude oil prices had increased beyond $54 per barrel suggests that $50 oil is not an anomaly; it is the new norm. The $54 price suggests that we may well see $60 per barrel oil soon.

I am reminded that $4 per mmbtu natural gas prices were considered aberrant until very recently, explained, in part, by low storage levels. As of this writing, though, the Henry Hub price for natural gas was at $5.65, and while futures prices for November closed below $7 yesterday, January prices remained at about $8.67 (figure 1).

[FIGURE 1 OMITTED]

Low storage levels again? No, even considering disruptions due to hurricanes, storage remained 7% above the five-year average (figure 2). What's more, excluding a strike in Nigeria, the political unrest supporting high petroleum and natural gas prices seems unlikely to fade any time soon. In fact, renewed terrorism and violence in OPEC nations and Russia could easily cause more supply disruptions that would drive spot prices higher.

[FIGURE 2 OMITTED]

The high fuel prices have not led to a recession--at least yet. Industry has absorbed the higher energy costs, and motorists have felt the pain of high gasoline prices. Consumers however, may not be prepared for dealing with Old Man Winter, who is just around the corner in many parts of the country. Consumer complaints about high electric bills along with rolling blackouts, you will remember, are what launched the California energy crisis onto the nation's front pages. Similar complaints about home heating costs could finally make energy issues a national priority.

Not everyone is waiting for high energy prices to become a national story, choosing instead to take control of their energy costs. For instance, I was ...