CS Energy US LNG Jan 2014

Commodity Spotlight Energy

How the US supply of LNG will change the gas market in future

In future, the US intends to supply liquefied natural gas (LNG) to gas markets overseas. Even though the additional US supply is small by comparison with the volumes supplied by Australia (the second emerging major player on the LNG market), it might dampen international prices in the long term because it is not linked to oil prices and is more flexible. Since the US will additionally be stepping up its gas exports by pipeline, the Henry Hub price is likely to rise slightly. Thanks to the high availability of gas, however, the knock-on effect should be limited. What is more, the high conversion and transport costs of LNG are likely to preclude any levelling out of international prices.

To know more click here PDF