{"id":6637,"date":"2023-04-18T11:26:48","date_gmt":"2023-04-18T11:26:48","guid":{"rendered":"https:\/\/euromenaenergy.com\/?p=6637"},"modified":"2023-04-18T11:26:48","modified_gmt":"2023-04-18T11:26:48","slug":"world-gas-supply-shifts-from-shortage-to-glut-with-demand-muted","status":"publish","type":"post","link":"https:\/\/emimer.com\/?p=6637","title":{"rendered":"World Gas Supply Shifts From Shortage to Glut With Demand Muted"},"content":{"rendered":"<p>The world is becoming awash with natural gas, pushing prices lower and creating an overabundance of the fuel in both Europe and Asia \u2014 at least for the next few weeks.<\/p>\n<p>The trend has been a rare sight over the past year since the war in Ukraine upended energy markets and Europe rushed to secure as many alternative supply sources as possible.<\/p>\n<p class=\"paywall\">Now, inventories are filling up from South Korea to Spain, a result of mostly mild winter weather and efforts to reduce consumption. Tankers filled with liquefied natural gas \u2014 a stopgap in replacing lost Russian pipeline flows \u2014 now often struggle to find a home, spending weeks idling at sea.<\/p>\n<figure class=\"paywall\" data-id=\"397372464\" data-type=\"image\" data-image-type=\"chart\" data-image-size=\"full\" data-align=\"center\" data-widget-url=\"https:\/\/www.bloomberg.com\/toaster\/v2\/charts\/af2659700b726f7554f535141d40dd85.html?brand=markets&amp;webTheme=markets&amp;web=true&amp;hideTitles=true\">\n<div class=\"chart\" data-responsive=\"true\">\n<div class=\"chart-js\">\n<h3 id=\"europe-is-filling-its-gas-storage-weeks-early\" class=\"chart__title\">Europe is Filling It&#8217;s Gas Storage Weeks Early<\/h3>\n<p class=\"chart__subtitle\">Gas storage reached current levels 11 weeks earlier compared to 2021<\/p>\n<div class=\"chart__container\" data-src=\"https:\/\/www.bloomberg.com\/toaster\/v2\/charts\/af2659700b726f7554f535141d40dd85.html?brand=markets&amp;webTheme=markets&amp;web=true&amp;hideTitles=true\" data-toaster-id=\"397372464\"><iframe src=\"https:\/\/www.bloomberg.com\/toaster\/v2\/charts\/af2659700b726f7554f535141d40dd85.html?brand=markets&amp;webTheme=markets&amp;web=true&amp;hideTitles=true\" frameborder=\"0\" scrolling=\"no\" data-toaster-id=\"397372464\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<p class=\"chart__source\">Source: Gas Infrastructure Europe<\/p>\n<p class=\"chart__footnote\">\n<\/div>\n<\/div>\n<\/figure>\n<p class=\"paywall\">Demand for gas typically slides as the heating season ends, before hotter weather lifts cooling needs later in the summer. The fuel then mainly goes into storage sites to prepare for the next season, but this year, refilling efforts in Europe may be completed as early as\u00a0late August, Morgan Stanley said.<\/p>\n<p>\u201cThere does appear to be a brief gas glut that should sustain pressure on LNG prices in the next few weeks, potentially nudging benchmarks slightly lower,\u201d said Talon Custer, a\u00a0Bloomberg Intelligence\u00a0energy analyst.<\/p>\n<p class=\"paywall\">While gas prices in Europe and Asia have plummeted from last year\u2019s highs, they\u2019re still well above the average of the last ten years, signaling possible concern that the current glut could disappear. Custer says prices \u201cmay be close to a floor\u201d as cheaper gas costs could spur additional demand.<\/p>\n<p class=\"paywall\">All eyes are on the summer weather, as any extreme heat and droughts could boost consumption. By the beginning of the third quarter, importers will start to prepare for the winter, heating up competition for LNG cargoes, Custer said.<\/p>\n<p class=\"paywall\">But for now, the glut is spreading.<\/p>\n<h3 id=\"from-spain-to-china\" class=\"paywall\">From Spain to China<\/h3>\n<p class=\"paywall\">In Spain, home to the most LNG terminals in Europe, gas storage is already 85% full, meaning the nation\u2019s market could quickly turn to overcapacity and weigh on spot prices, RBC Capital Markets said.<\/p>\n<div class=\"for-you__wrapper paywall\"><\/div>\n<p class=\"paywall\">In Finland, LNG import\u00a0slots\u00a0for the summer period were reduced to 10 from 14, in part due to an expected reduction in demand. Europe rapidly installed mobile LNG import terminals as it cut dependency on Russian pipeline gas, and more will be added this year and next.<\/p>\n<p class=\"paywall\">Meanwhile, global LNG exports rebounded in March to an all-time high due in part to a recovery in US production. The additional supply is contributing to lower prices as traders struggle to find a home for shipments.<\/p>\n<figure class=\"paywall\" data-id=\"397393147\" data-type=\"image\" data-image-type=\"chart\" data-image-size=\"full\" data-align=\"center\" data-widget-url=\"https:\/\/www.bloomberg.com\/toaster\/v2\/charts\/13725ddd6e77ab9299e18a37bb57398a.html?brand=markets&amp;webTheme=markets&amp;web=true&amp;hideTitles=true\">\n<div class=\"chart\" data-responsive=\"true\">\n<div class=\"chart-js\">\n<h3 id=\"global-lng-exports-hit-record-high\" class=\"chart__title\">Global LNG Exports Hit Record High<\/h3>\n<p class=\"chart__subtitle\">More supply from the US and Australia help to ease crisis<\/p>\n<div class=\"chart__container\" data-src=\"https:\/\/www.bloomberg.com\/toaster\/v2\/charts\/13725ddd6e77ab9299e18a37bb57398a.html?brand=markets&amp;webTheme=markets&amp;web=true&amp;hideTitles=true\" data-toaster-id=\"397393147\"><iframe src=\"https:\/\/www.bloomberg.com\/toaster\/v2\/charts\/13725ddd6e77ab9299e18a37bb57398a.html?brand=markets&amp;webTheme=markets&amp;web=true&amp;hideTitles=true\" frameborder=\"0\" scrolling=\"no\" data-toaster-id=\"397393147\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<p class=\"chart__source\">Source: Ship-tracking data compiled by Bloomberg<\/p>\n<p class=\"chart__footnote\">\n<\/div>\n<\/div>\n<\/figure>\n<aside class=\"left-rail-newsletter paywall\"><\/aside>\n<p class=\"paywall\">The UK\u2019s exports of gas to the continent are\u00a0surging\u00a0as the nation lacks large storage sites, and LNG keeps flowing at record rates for the time of the year. In addition, China saw record\u00a0re-exports\u00a0of LNG amid a slow recovery after pandemic restrictions were lifted, and some vessels are diverting from another major LNG importer, South Korea. Japan, a big buyer, is also offering to sell shipments to stave off an oversupply at home.<\/p>\n<p class=\"paywall\">In South America, demand remains weak until Argentina deploys its second floating import terminal in May, in time for colder weather in the Southern Hemisphere, said Leo Kabouche, an analyst at Energy Aspects Ltd.<\/p>\n<p class=\"paywall\">Still, planned annual maintenance at gas facilities from late April through the summer could put a lid on excessive supply. Other risks remain, too, from further cuts to Russian deliveries or unexpected outages. Global LNG supply is largely expected to remain limited for another two years.<\/p>\n<p class=\"paywall\">That\u2019s reflected in forward prices, which are seen higher in the coming months and in particular in the winter, and remain elevated through the start of 2025.<\/p>\n<p class=\"paywall\">\u201cFor 2023, the European gas balance is much more fragile\u201d than last year, the French Institute of International Relations\u00a0said\u00a0in a note last week. \u201cAny slight disruptions in supplies can have major impacts.\u201d<\/p>\n<p class=\"paywall\"><em>\u2014 With assistance by Elena Mazneva and Francois De Beaupuy<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The world is becoming awash with natural gas, pushing prices lower and creating an overabundance of the fuel in both Europe and Asia \u2014 at least for the next few weeks. The&#8230;<\/p>\n","protected":false},"author":1,"featured_media":6638,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22],"tags":[40,46,48,50,57,68,76,77,78,79,80,82,86,87,88,90,95,96,98,99,103,107,109,111,112,114,121,123,137,139,146,148,153,159,174,176,181,182,184,187,196,201,202,203,209,217,221,222,229,231,232,233,239,241,244,246,249,250,251,252,256,262,263,266,268,277,279,280,283,285,288,300],"class_list":["post-6637","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-oil-gas","tag-alleviation","tag-aramco","tag-athens","tag-athensenergydialogues","tag-baroudi","tag-carbon","tag-climate","tag-climate-change","tag-climateaction","tag-climatechange","tag-closure-of-nuclear","tag-co2","tag-cyprus","tag-decarbonising","tag-decarbonization","tag-democracy","tag-disputes","tag-doha","tag-east","tag-eastmed","tag-egypt","tag-embargo","tag-emissions","tag-energy","tag-energy-market","tag-energyindustry","tag-europe","tag-european-fuels","tag-gas","tag-gazprom","tag-greece","tag-greenenergy","tag-hydrocarbons","tag-international","tag-lebanon","tag-liquefied-natural-gas","tag-maritime","tag-maritime-boundaries","tag-maritime-disputes","tag-mediterranean","tag-natural-gas","tag-offshore","tag-oil","tag-oil-and-gas","tag-opec","tag-peace","tag-plants","tag-pollution","tag-poverty","tag-power","tag-putin","tag-qatar","tag-renewable-energy","tag-reserves","tag-rosneft","tag-roudi","tag-russia","tag-russia-in-the-european-energy-sector","tag-russian-gas","tag-russian-sanctions","tag-saudi","tag-solar","tag-solar-power","tag-straddling","tag-sustainability","tag-total","tag-trump","tag-turkey","tag-ukrain","tag-unclos","tag-usa","tag-300"],"_links":{"self":[{"href":"https:\/\/emimer.com\/index.php?rest_route=\/wp\/v2\/posts\/6637","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/emimer.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/emimer.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/emimer.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/emimer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6637"}],"version-history":[{"count":0,"href":"https:\/\/emimer.com\/index.php?rest_route=\/wp\/v2\/posts\/6637\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/emimer.com\/index.php?rest_route=\/wp\/v2\/media\/6638"}],"wp:attachment":[{"href":"https:\/\/emimer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6637"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/emimer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6637"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/emimer.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6637"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}