A buyer’s market
The future for LNG at least for the next 5-10 years, looks set to be a buyers’ market.
The global LNG market has been a seller’s market ever since the Fukushima disaster in 2011.
The market, however, went through a big change in 2014. Due to a decrease in demand starting in the summer of 2014, the spot prices of LNG dropped and were priced at roughly $10/mmbtu as of November 2014. As the global oil prices have dropped since June 2014, Asian LNG prices linked to the global oil prices fell accordingly.
Platts JKM LNG (Japan-Korea Market price for LNG) was $20.00/MMBtu in the beginning of 2014 but it dropped to less than $7/MMBtu in the first quarter of 2015. It came down to about $4.4/MMBtu in May 2016 according to the table below.
Spot LNG Prices in 2013-2016 ($/MMBtu)
| Dec. 2013 | Sep. 2014 | June 2015 | Nov. 2015 | May 2016 | |
|---|---|---|---|---|---|
| US Henry Hub | 4.5 | 3.8 | 2.7 | 2.0 | 1.9 |
| UK National Balancing Point | 10.6 | 8.2 | 6.7 | 6.0 | 4.2 |
| Platts JKM™ | 17.6 | 12.8 | 7.5 | 7.5 | 4.4 |
source : Compilation of data
Global Resource Politics: the Past, Present and Future of Oil, Gas and Shale
Global Resource Politics: the Past, Present and Future of Oil, Gas and Shale
