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A framework for LNG market evolution
Front month Asian & European LNG prices plunged below 3 $/mmbtu during the peak of the Covid demand slump in the summer of 2020. Step forward two years to the summer of 2022 and prices surged to 80 $/mmbtu as Russia cut gas supply to Europe. Prices for this summer are back in single digits again, with European gas prices down 40% since we flagged the risk of a price plunge 5 weeks ago. What happens next? We don’t know. But we have a market modelling framework that helps us put some structure around the inherent uncertainty of LNG market evolution. In today’s article we summarise the supply & demand drivers ... (full story)