Devastating Tsunami to Have Ripple Effect Worldwide
Leading independent energy producer predicts volatility and higher prices for natural gas
Stamford, CT – March 11, 2011 – The devastating tsunami and earthquake which rocked Japan Friday morning delivered not only a horrific blow to Japan’s people and economy but is also expected to send shockwaves through the international energy markets as well.
Financial experts and energy providers across the globe are scrambling to assess the situation and level of damage and determine what impact the disaster will have on the world energy stage.
The cost of liquefied natural gas (LNG) rose immediately following news of the tragedy in Japan. Experts from MXenergy, one of the nation’s leading independent energy providers, expect the rise in prices to continue.
“Emergency shutdowns of nuclear power plants in Japan will create a heightened need for natural gas in that region and may displace supplies designated for the United States,” says Tim Ray, MXenergy Director of Gas Supply. “That displacement and the lack of knowledge at this point as to the extent of the damage and time needed for repair may cause prices to continue to rise.”
In August of 2002, Japan shutdown 17 of its 54 reactors for safety inspections which triggered an 11% increase in LNG demand for the following year.
“History shows us that disruptions in Japan’s nuclear power production triggers spikes in LNG prices,” continues Ray. “The tragedy today is more than a simple disruption and we can only assume the implications on the energy markets will be far reaching.”
Friday morning a magnitude 8.9 earthquake off the shore of Japan triggered a 23-foot tsunami which ravaged the cities and villages along a 1,300 mile stretch of coast. Hundreds are presumed dead and the number is expected to rise. Scientists said the quake was the fifth largest earthquake in the world since 1900.
MXenergy is one of the fastest growing retail natural gas and electricity suppliers in North America, serving approximately 500,000 customers in 41 utility territories in the United States and Canada. For over 11 years, the company has provided millions of customers with a choice in how they purchase energy to run their homes and businesses. Founded in 1999 to provide natural gas and electricity to consumers in deregulated energy markets, MXenergy helps residential customers and small business owners control their energy bills by providing both fixed and variable rate plans. MXenergy is committed to best practices in environmental conservation, supporting local communities through various outreach programs and is a member of the Chicago Climate Exchange. For more information MXenergy please visit www.mxenergy.com.
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