Why Nord Stream 2 could cost US gas producers US$5 bln

Get this report


You can pay by card or invoice

For details on how your data is used and stored, see our Privacy Notice.

- FAQs about online orders
- Find out more about subscriptions

The Henry Hub price is at a 25-year record low. But the forward curve is in steep contango, supported by expectations of limited associated gas supply and full utilisation of US LNG. Full utilisation of US LNG will depend on how the ongoing global gas oversupply will evolve. But much of it will also depend upon the commissioning of Nord Stream 2, a new Russian pipeline due to be commissioned in early 2021. Access to the new pipeline would incentivise Gazprom to export more and facilitate a repeat of the US LNG under-utilisation we are experiencing this summer. The US Senate has in the past sought to impose sanctions on Nord Stream 2 and will be voting soon on whether further sanctions should be applied. If the bill is passed by both houses of Congress and signed into law by the president, it could prevent the project from being completed. There is a lot at stake for the US gas market when the US Senate will vote on further sanctions.

Table of contents

  • Why the Henry Hub forward curve 2021 contango is underpinned by full US LNG utilisation
  • Why Nord Stream 2 will dictate the European market balance in 2021
  • What would be the implications on the US gas market?
  • Conclusion

Tables and charts

This report includes 6 images and tables including:

  • US LNG feed gas under-utilizations vs. associated gas production losses since 31 March 2020
  • Forward prices: Henry Hub and TTF
  • Forward prices: Henry Hub and TTF differentials vs US LNG economics
  • Russian pipeline flows to Europe 2018-2021
  • 2021 exports and European price levels
  • US LNG feed gas capacity vs. under-utilization

What's included

This report contains:

  • Document

    Why Nord Stream 2 could cost US gas producers US$5 bln

    PDF 826.44 KB