We've been watching with interest several developments over the past few weeks that illuminate trends in natural gas. As we went to press, we turned up the heat and wrapped our pipes when a prolonged cold snap swept across the U.S., causing minor amounts of freezing rain and ice to accumulate on patios throughout the Houston metropolitan area. That followed Old Man Winter’s big blast in the first week of the New Year that tore through the Northeast.

But even though wholesale gas prices at the New York citygate reached record highs amid strong gas demand, hitting $46.50 per million British thermal unit at one point, gas futures Nymex failed to budge in any meaningful way. It seems $3 is the equilibrium price that producers can expect these days, no matter the weather, storage numbers or rising exports. Blame those multiwall pads with up to 22 wells on them in the Marcellus Shale.

This price dilemma speaks volumes about the reliability of gas supply and traders’ belief that supply is not only plentiful, but will increase steadily through 2018. Climbing the well of gas to come will be one of the industry’s biggest challenges.

After all, this is the year that the Marcellus’ takeway capacity finally comes online, to feed hungry end users. It is the year of the Permian Basin’s rising gas output associated with more oil production—again, enhanced by additional oil and gas pipelines that will move gas to market. And finally, it is the year of the Haynesville Shale, whose gas production is also on the uptake, heading above 7 billion cubic feet a day thanks to enhanced completions that have revived the economics in that historic play, making it able to compete favorably with the legendary Marcellus.

Sadly, many constituents in the Northeast persist in blocking or delaying natural gas pipeline construction while innocent consumers are left to a pay a heavy price—while living right next door to the world’s largest gas accumulation, and one that should be one of the cheapest.

In Washington, there is good news and bad. Yes, regulators have been charged with approving pipelines and other infrastructure in a timely manner. But if local governments and/or protesters continue to block this, gas supplies will build, wellhead prices for producers will languish and consumers will see higher utility bills.

A free and unfettered market should be allowed to determine the outcome of all this. That’s why we were relieved that Energy Secretary Rick Perry failed in his attempt to tilt the balance on power-generating commodities, to the detriment of gas.

Coal currently is about 30% of the energy mix, down from a higher number a decade ago, a Raymond James report said. But FERC rejected Perry’s plan to create a policy that favors coal-fired energy and nuclear over gas and renewables, with certain coal-fired plants to receive “above-market” pricing. While we admire and agree with any official goal to make sure the electricity supply remains reliable, safe and abundant—not to mention affordable—we hesitate to approve of manipulating the market the way Perry had proposed. That always has unintended consequences.

This brings us to the export of natural gas and whether the government will someday be forced to regulate how much gas companies can export into a burgeoning and highly competitive international market.

Time after time when we’ve interviewed analysts and consultants on gas supply, they’ve mentioned that at $4 per thousand cubic feet flat, the U.S. has, and will have plenty of natural gas reserves and production, enough to meet domestic needs as well as export demands, whether to Mexico or as LNG. They say it is not clear that despite the rising demand, gas prices will go up accordingly. That’s easy to say now, but we’ll really see the truth of the matter four or five years from now, when LNG cargoes are departing our shores from several ports.

Meanwhile, we observe that the LNG marketplace has changed. Ironically, LNG was recently shipped by Petronas from the Yamal Peninsula in far northern Russia to the U.K., and from there, it was delivered to Boston—a hotbed of anti-fossil fuel sentiment that is fighting any notion of new gas pipelines from Pennsylvania traversing New England. Never mind that citizens there pay higher utility prices than most other regions.

“Russian LNG, parked in Britain by a Malaysian trading company, re-loaded onto a French flagged vessel and taken to Boston, Massachusetts… now if that does not herald the arrival of a truly global trade in natural gas…it is hard to say what other proof is needed,” said the Gaffney Cline Monitor newsletter. Well said indeed.

Join us later this month on Feb. 20 and 21, to hear from several top producers at Hart Energy’s first DUG Haynesville Conference, located in Shreveport, La., near the heart of the play. Go to Hartenergyconferences.com for more details. We’ll see you there.