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A buyer’s market

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

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Global Resource Politics: the Past, Present and Future of Oil, Gas and Shale

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