Projected demand for crude oil well into the 21st century is very optimistic. For the next three years, supply will increase faster than demand and this will keep crude oil prices at present levels. As supply stabilizes and consumption increases, the downward pressure on crude oil prices will ease. Oil prices are driven by the international oil market. Gas prices are driven by factors such as weather, demand for gas not satisfied by the pipeline system, availability of spot supplies, and competing fuel prices.
Natural gas is less traded internationally than oil.
As the historical data shows, most components of natural gas prices are stable with the exception of marketing cost. Marketing cost is the only cost that oscillates widely. Gas prices increased as regulations faded out in the early 80's. With deregulation, natural gas started trading in the spot and commodity markets. Since 1985, this spot market for gas has grown in importance and today it is the major player in the determination of gas prices.