Where is Your Heart?

Here we are just on the other side of the holiday season.  It’s that cold part of the year without the festive decorations.  A new calendar offers an excuse to consider just what lies ahead, but we’re too far from Valentine’s Day to run out and buy cards and candy.  That doesn’t mean we can write about the heart. 

Natural gas isn’t typically a heartwarming subject, but it can warm a house in the middle of winter.  Consumers across developed nations have it piped into their homes to burn.  But have you seen the prices of it lately?  They’ve been moving fast in either direction.  As of this writing, they’ve fallen roughly 43 percent since peaking in October but are still 40 percent higher than a year ago. 

Europe is stuck in an energy crisis.  First, China’s demand for liquefied natural gas is rising as their primary sources of energy, coal and hydropower, have been curbed by environmental mandates and droughts respectively.   Secondly, Russia decreased shipments of the fuel, due in part to Germany’s energy regulator temporarily suspending its certification of the Nord Stream 2 pipeline.  In response, there has been a spike in the number of vessels carrying liquefied natural gas originating in America to the European Union.  These additional shipments, however, take supply off the market here in the U.S. which is hitting some of our poorest citizens hard in the pocketbook.  Inflation is already hurting many Americans in other areas of consumption.  An upward price trend for a nondiscretionary item like heat in the winter will negatively impact their spending elsewhere. 

It doesn’t matter where you’re from, nobody wants to be cold.  Our hearts can hurt for anyone struggling to keep the furnace on this winter.  Ultimately, a solution will emerge.  Left alone, market prices could sort things out.  Differently, governments could step in, opting for more nationalistic solutions which help those at home while leaving others in the cold; after all, home is where the heart is, and cheaper heat might help politicians get reelected.  Other potential outcomes are surely possible as well.  Atlas doesn’t have a strong opinion one way or another about the solution but would love hearing your thoughts on it.  You might even say a response would warm our hearts.