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Gas exporters forum wants gas prices linked to oil to maintain supply

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Gas exporters forum wants gas prices linked to oil to maintain supply

Gas exporters forum wants gas prices linked to oil to maintain supply

The debate over how to price natural gas is settled, at least for exporters, and oil indexing should prevail, Bloomberg reports.

Prices have to be linked to crude oil to keep expected revenue predictable, with some $8 trillion of investments in the fuel needed by 2040, according to Yury Sentyurin, the new head of the Gas Exporting Countries Forum, an industry group representing gas sellers whose members include countries like Russia, Iran, Algeria, Nigeria and Qatar.

Many consumers are opting for different formulas used by the U.S. and Australia, which are emerging as top exporters.

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Instead of oil, some consumers use tolling to pay for liquefaction and price the gas based on Henry Hub on the Nymex and other benchmarks.

“Consumers should understand the peculiarities which producers face,” Secretary-General Sentyurin said in an interview. “Security of investment and supply can only be on the basis of long-term contracts closely connected to oil prices so we could plan further investments into crucial infrastructure,” he said.

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Tags : 2040AlgeriaIranNigeria and QatarRussiaYury Sentyurin
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