Californians paying more for oil, natural gas

The LA Times reports that the price of oil and natural gas are going up, up, up:

Oil for November delivery climbed $1.18 a barrel to $51.09 on the New York Mercantile Exchange.

Market watchers have made something of a sport out of guessing how expensive oil might get, with some believing prices have been pumped up by speculators.

"I think it's a little crazy, but that doesn't mean that it can't get a little higher," said Gene Edwards, senior vice president of supply, trading and wholesale marketing at San Antonio-based Valero Energy Corp.

Heating oil, a key wintertime commodity in the East, rose 2.12 cents to a record $1.4068 a gallon in New York. And natural gas for November delivery rose 43.9 cents on the Nymex to $7.164 per million British thermal units, up 52% since Ivan made landfall in mid-September.

California's natural gas prices increased 49 cents to an average of $5.27 per million BTUs paid at border delivery points.

"The concern here is that this is a time of year when you should be building supplies for winter," said Flynn at Alaron.

Southern California Gas said Tuesday that higher natural gas costs could push residents' wintertime monthly bills 16% to 22% higher than they were last year. The company, a subsidiary of Sempra Energy, serves 18 million customers from San Luis Obispo to the Mexican border.

Natural gas fuels many of the State's power plants, so this could also mean an increase in the wholesale cost of electricity. That makes finding new supplies of Natural Gas all the more important.