Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:
US LNG, its competition with Russian gas, and the implications for the EU

But the real LNG game changer is US LNG. This new source of gas, the result of the `shale revolution' that has taken place in the US since the mid-2000s - and that has rendered the US a net exporter of natural gas - has already transformed global gas market dynamics. US LNG is a highly flexible source of gas.

It is sold by private companies to the highest bidder (apart from some contracts with Poland and Lithuania, where buyers are willing to pay a `diversification premium'. This means that if buyers outside of Europe offer better prices (depending also on shipping cost differentials) shippers of US LNG would supply them instead of Europe. US LNG is thus usually not a `guaranteed' or `point-to-point' source of gas.

Russia-Poland gas relationship: risks and uncertainties of the ever after | Oxford Energy Insight |

The existing long-term contracts (LTCs) between Poland and Russia for the transit and supply of natural gas are coming to an end, with the transit contract expiring on 17 May 2020. As suggested by a recent OIES insight, Russia's requirements for Polish transit in the second half of 2020 could be secured by short-term bookings rather than a new long-term transit contract.

Indeed, this is what happened at the beginning of May when Gazprom booked 80 per cent of capacity of the EuRoPol pipeline (the Polish segment of Yamal-Europe), under the new auction system for Q3 2020 when it will be needed to substitute for Nord Stream transit which will be halted in July for regular summer maintenance.

Gazprom also secured a very advantageous transit tariff for Q3 2020 for the capacity which was offered by Gaz System, the Polish gas system operator, at its regular auctions, conducted under the EU Capacity Allocation Mechanism (CAM) network code.



'Sapere aude'
by Oui (Oui) on Wed Dec 22nd, 2021 at 09:53:42 PM EST

Others have rated this comment as follows:

Display:

Occasional Series