Inland Utilities Prepared for Potential Energy Price Shocks from Mideast War

RIVERSIDE (CNS) - Power providers throughout the Inland Empire said
this week they don't anticipate major increases in electricity prices despite
destruction of natural gas facilities amid fighting in the Middle East, where
losses could drive up demand for natural gas supplies in the U.S., impacting
electrical-generation costs.
  

``There's no indication of any near-term impacts from the overseas gas
disruptions,'' SoCal Edison spokesman David Eisenhauer told City News
Service Friday. ``From an electricity supply and pricing standpoint, we don't
see impacts.''
  

In Riverside, the municipally owned Riverside Public Utilities also
was not forecasting any dramatic changes, noting that natural gas inputs to the
power grid are ``fairly moderate and limited.''
  

``Riverside's internal natural gas generation ... is typically used to
meet just about 5% of the city's total load-serving needs,'' RPU told CNS.
``And the expected amount of natural gas we anticipate using this summer has
already been pre-purchased at competitive prices.''
  

Earlier this week, joint U.S.-Israel military attacks on Iran resulted
in significant damage to the country's South Pars natural gas field, one of
the largest in the world and generally described as a ``lifeline'' to meet the
Islamic republic's needs.
  

The nation's forces responded in kind, hurling missiles and drones at
Qatar, which hosts the largest American military installation in the Middle
East, inflicting major damage to liquified natural gas repositories. According
to published reports, the LNG facilities could require three or more years to
repair.
  

The tit-for-tat strikes come following Iran's announced closure of the
Strait of Hormuz to oil and LNG ship tanker traffic navigating the Persian
Gulf, with the exception of a few select countries, and then only after
payments in Chinese Yuan for passage, according to reports based on statements
by the Islamic Revolutionary Guard Corps.
  

Spot market contracts on natural gas priced per million British
thermal units spiked to nearly $3.30 BTUs on Thursday but receded 2% in U.S.-
based commodities trading Friday, according to TradingEconomics.com and
OilPrice.com. The softening was similar to minor downward adjustments in per-
barrel spot prices for West Texas Intermediate Crude. Despite touching $100 a
week ago, late futures trading Friday saw WTIC oil prices holding at $98 per
barrel, which is still causing prices at the gasoline pump to steadily rise
everywhere.
  

Domestic oil prices have been mildly restrained by the White House's
decision to release 172 million barrels of oil from the Strategic Petroleum
Reserve. In overseas oil futures trading, per-barrel prices on some crude
products have already jumped to nearly $150.
  

While diesel or other fuel isn't vital to run power plants, natural
gas often is, according to the U.S. Energy Information Administration.
  

``Natural gas is the single-largest source of energy used to generate
electricity in the United States, making up 43% of electricity generation,''
the EIA said.
  

The Imperial Irrigation District, which supplies electricity to a
large swath of the eastern Coachella Valley, told CNS there's an ``action
plan'' in place to contend with any price surges stemming from greater pressure
on U.S. natural gas producers to sell more product overseas due to Middle East
supply breakdowns.
  

``Of 1,340 megawatts, 40% of this power generation would come from
natural gas,'' IID said. ``To protect against market volatility, we have a risk
management policy and procurement plan ... that supports a strategic natural
gas and energy hedging program, giving us flexibility to changing conditions.''
  

The utility said that as of now, ``we have secured up to 90% of our
forecasted natural gas requirements for this summer.''
  

IID said its power purchasing team keeps a close eye on market
fluctuations and can ``make resource decisions daily, hourly and even minute by
minute ... to protect customers from volatility.''
  

SoCal Edison's power portfolio is sufficiently diverse to ``help
shield customers'' from market shocks, according to Eisenhauer.
  

``Unlike gasoline, which can re-price quickly, electricity rates don't
move in real time,'' he said.
  

SCE is the largest energy provider in Riverside County.
  

Eisenhauer said less than 10% of SCE's power plants operate
exclusively on natural gas, and he emphasized that pricing adjustments are
subject to hearings at the state level.
  

According to RPU, because of advance contracts on natural gas
purchases, ``even if natural gas prices start to rise significantly, Riverside
will be protected by fixed cost forward gas purchases.''
   The utility further noted that most of its acquisitions originate from
Delta, Utah, ``where natural gas is much less expensive.''
  

``RPU staff do not anticipate experiencing any material deviations to
our budgeted energy costs this year, regardless of how domestic natural gas
prices might change,'' the agency stated.
  

The U.S.-Israel operations, dubbed ``Operation Epic Fury,'' started
with the assassination of Iran's supreme leader and most of his family, as well
as the bombing of a girls school, where more than 150 children died, according
to Amnesty International and multiple other sources. The Trump administration
did not obtain a formal declaration of war from Congress, and no exit strategy
has been announced by the White House.
  

Iran's IRGC and military have made it clear the U.S. needs to vacate
the entire region to restore peace.
  

Inflation predictions vary, but energy price impacts from the war will
likely weigh on most sectors of the economy, according to the Federal
Reserve Bank and other sources.
  

Copyright 2026, City News Service, Inc.