What is the relationship between Russian gas and US LNG?


Will Russia’s gas strategy mimic that of Saudi Arabia’s oil strategy, will it seek to retain market share in Europe, pushing European gas prices to levels that force the shut-in of US LNG exports?

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In our latest article, Russia market share strategy: US LNG at risk of shut-in, we saw as much as half of US LNG at risk of being shut-in at times over the next five years. Using our bespoke Global Gas Model to run sensitivity analysis, we focused on three key determinants: coal, oil and Russia's gas export strategy. But what is the market outlook if prices start to rise?

Russia’s share of the European market could decline to only 25% if the price of oil and Russian contract gas rise.

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In a high oil price environment, Russia may withhold volumes from the market above the ToP level of existing contracts to achieve higher spot prices and support existing contract pricing. Alternatively, should oil prices remain low Russia oil-indexed contract gas will remain competitive and buyers will maximise their offtake of Russian gas to the ACQ level.

Get the full analysis including eight sensitivities and outcomes in the full report here.

Watch the videoWatch Stephen review a range of sensitivities based on a varied oil and coal price

Read more

Report In a historic reversal of gas flows, Cheniere loaded and shipped the first LNG cargo to leave the US Lower 48. Our US Upstream Week in Brief looks at the implications and what it means for the global LNG market.

Report With growing LNG supply and coal to gas switching in Europe, FSRU development and supplier flexibility on contracts is key to rebalancing the market. Read part I and part II on global gas and LNG themes for 2016.

ReportThe LNG market was characterised by weak Asian demand in 2015. In our news release: US & Australian LNG start-ups in 2016, but real LNG growth yet to come, we look at key findings for 2015 and the outlook for 2016.

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