Global LNG trade: A comprehensive up to date analysis
File(s)
Author(s)
Nikhalat-Jahromi, Hamed
Angeloudis, Panagiotis
Bell, Michael GH
Cochrane, Robert A
Type
Journal Article
Abstract
The importance of the liquefied-natural-gas (LNG) in global gas trade has grown steadily over the past decades; the article focuses on this significant form of energy and provides an exhaustive portrait of its trade. LNG trade flows both regionally and by country are described and the future of trade is forecast. Next, the business structure is discussed. The traditional LNG trade on long-term contracts (LTCs) is considered and it is explained how vital these contracts are in distributing the volume and price risks in the industry, furthermore, in securing finance for the LNG projects. The essence of gas market liberalization and its effect on LTCs is considered and it is shown that in liberalized gas markets, risk has migrated to upstream. In the light of this risk redistribution, the suppliers’ intent in moving toward vertical integration of the industry is discussed. Later, various types of LNG spot sale in arbitrage, and for uncommitted product to LTCs, are considered and the biggest spot sale markets are identified. Finally, pricing of LNG for different markets in both LTCs and spot sales is discussed and it is forecast that due to the surge of supply, rather than any change in oil prices, LNG prices are anticipated to decrease globally at least for the next 5 years.
Date Issued
2017-03
Date Acceptance
2017-03-01
Citation
Maritime Economics & Logistics, 2017, 19, pp.160-181
ISSN
1479-2931
Publisher
Palgrave Macmillan UK
Start Page
160
End Page
181
Journal / Book Title
Maritime Economics & Logistics
Volume
19
Issue
1
Copyright Statement
© 2016 Palgrave Macmillan. This is a post-peer-review, pre-copyedit version of an article published in Maritime Economics & Logistics. The definitive publisher-authenticated version is available online at: https://dx.doi.org/10.1057/mel.2015.26
Subjects
Science & Technology
Technology
Transportation
LNG
long-term contracts
market liberalization
spot sales
pricing
1402 Applied Economics
1503 Business And Management
1604 Human Geography
Logistics & Transportation
Publication Status
Published
Article Number
1
Date Publish Online
2017-04-20