Chris Jarvis, founder and president of Caprock Risk Management, told CNBC’s “Morning Call” that unusually cold weather in early April has hammered many businesses on energy costs.
He said many businesses that hedge on their natural gas supplies got caught short this year and are forced to pay higher rates on the spot market.
“A lot of these guys learn from the previous year,” Jarvis said Monday. “Just like the hurricane forecast last year, they went out and hedged quite a bit. They got beat up a little bit when the hurricane season didn’t come through (as predicted). I expect next year, they’ll step up and buy a little bit more.”
But this isn’t the end of the world -- warm weather is coming and the need for heating will decline.