Bloomberg: Asian LNG Prices Expected to Sink as Low as $4 in `Ugly' Market
The slump in liquefied natural gas prices still has further to go, even after a plunge of 60 percent from last year’s peak, according to FGE, an energy consultant.
LNG prices may sink as low as $4 per million British thermal units by 2017 because of a glut and probably won’t rise above $8 before 2020, FGE Chairman Fereidun Fesharaki said in a phone interview. That compares with the latest spot price of $7.10 for LNG shipped to northeast Asia, according to New York-based Energy Intelligence Group.
“It’s an ugly environment,” Fesharaki said.
While the International Energy Agency four years ago envisioned the possibility of a golden age of gas, Japan’s return to nuclear power after the 2011 Fukushima disaster and cheaper alternatives are threatening demand. LNG producers, meanwhile, are forecast to add 50 million metric tons of new capacity next year, the largest single annual increase and equivalent to a fifth of current global demand, according to Sanford C. Bernstein & Co. MORE