• 4 minutes Will We Ever See 100$+ OIL?
  • 8 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 11 minutes Energy Outlook for Renewables. Pie in the sky or real?
  • 8 mins Iran Loses $130,000,000 Oil Revenue Every Day They Continue Their Games . . . .Opportunity Lost . . . Will Never Get It Back. . . . . LOL .
  • 1 day Iran Captures British Tanker sailing through Straits of Hormuz
  • 19 hours Renewables provided only about 4% of total global energy needs in 2018
  • 10 hours EIA Reports Are Fraudulent : EIA Is Conspiring With Trump To Keep Oil Prices Low
  • 2 days Drone For Drone = War: What is next in the U.S. - Iran the Gulf Episode
  • 2 days Today in Energy
  • 2 days Berkeley becomes first U.S. city to ban natural gas in new homes
  • 2 hours Shale Oil will it self destruct?
  • 24 hours Oil Rises After Iran Says It Seized Foreign Tanker In Gulf
  • 6 hours First limpet mines . . . . now fly a drone at low altitude directly at U.S. Navy ship. Think Iran wanted it taken out ? Maybe ? YES
  • 5 hours N.Y. Governor Signs Climate Bill
  • 2 hours U.S. Administration Moves To End Asylum Protections For Central Americans
  • 3 days LA Solar Power/Storage Contract
  • 3 days Why Natural Gas is Natural
Alt Text

What The Market Is Overlooking In The Occidental Deal

Occidental Petroleum has caught a…

Alt Text

How To Play A Recovery In Oil Prices?

A realistic correction in the…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Will This Troubled Buyer Save The World Natgas Market?

I discussed last month how natural gas supply problems have been hitting Europe of late. And based on reports this week, it seems those issues may be deeper than originally expected.

Platts reports that Europe has lately become the world’s go-to natgas market. With prices for the commodity on the continent actually flipping to a premium over other big buyers like Asia.

That trend began in mid-February. When natgas prices at the U.K. National Balancing Point (NBP) hub climbed higher than the so-called JKM (Japan-Korea Marker) price for liquefied natural gas being shipping into these Asian countries. Related: A New Season Brings Big Changes In Energy

And over the past month, the gap between European and Asian natgas prices has widened. With NBP gas currently selling for a premium of $0.40 per MMBtu.

That’s a major shift — given that Japan-Korea LNG used to be the world’s premier sales outlet for natgas. In the wake of the Fukushima nuclear shutdown, for example, JKM marker prices climbed to $20 per MMBtu. Making this by far the best place around the globe to sell gas. Related: This Week In Energy: LNG Could Be 2015’s Big Winner

But the JKM marker price has been steadily eroding over the past year. To the point where April LNG deliveries here are now going for just $7.29 per MMBtu — a price decline of 60%, year-on-year.

That weakness has allowed the critical crossover in European and Asian prices noted above. Especially in light of recent supply restrictions at Europe’s largest natgas field — Groningen in the Netherlands. Related: Could Natural Gas Be A Better Bet Than Oil?

The loss of output from this massive field appears to be driving European prices to some of the highest levels in the world at the moment. A fact that is reportedly causing LNG supplies to be diverted to this market — in effect, helping put a floor on the global natgas market.

This should help stem the declines we’ve seen of late in Asian LNG prices. And the global natgas market could actually see more upward pressure, as South American LNG buyers are reportedly beginning to bid aggressively against Europe’s consumers.

Watch for better prices here, coming soon.

Here’s to being the buyer of choice,
Dave Forest

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play