Frontier Natural Gas has raised prices by 3 cents per thousand cubic feet to $2.50 per thousand for gas used for heating and cooling.
That means a gallon of gas would now cost $2,839.55, down from $2.,967.70.
Frontier also said it plans to lower prices by another 1.3 cents per million cubic feet this summer and 2019, when natural- gas prices are expected to rise.
As of Monday afternoon, Frontier had a $2 billion surplus and $9.3 billion in debt, according to its most recent financials.
A report by Bloomberg Intelligence pegged the surplus at $1.2 billion, but it does not include a $1 billion sale of oil assets, which is likely to boost Frontier’s stock price, which has gained nearly 25 percent in the past 12 months.
Frontier shares have gained more than 200 percent this year.
The price increases came amid an improving economic picture.
Economists have been calling for a price increase on crude and natural gas due to the shale-oil boom, and analysts expect the U.S. to produce enough oil to meet the demand for heating gas.
But that could be tough because oil prices are at historic lows and natural-sugar prices have plunged to new lows.
Natural gas has also been getting cheaper, partly because of lower oil prices and a surge in domestic natural-food consumption.
Oil prices fell to $40 per barrel on Monday, the lowest level in more than five years, as oil producers ramped up production.
Refining costs also were rising, with natural-gold refining capacity increasing by about 5 percent this week, according the U,S.
Energy Information Administration.
In the long run, prices may go up, said Andrew W. Smith, a commodities strategist at Raymond James.
But he added that a natural-oil glut and the price increases would help keep prices down.
“The prices of natural gas and oil are going to go up,” Smith said.
“They’re going to get higher as a result of that.”