Demand Impact of High Prices

Demand reduction?

Tight oil market may reverse fuel switching
Residential/Commercial: Few short-term options
Power Producers: Willing (and mostly able) to pay
- Margin economics have insulated all but most inefficient generators
- Major power markets equilibrate on gas price
Industry: The most vulnerable
- Commodities subject to intense competition
- Important imports
- Global spare capacity in countries with low gas prices