Bloomberg News

LNG Prices to Remain Strong, Helped by New Buyers, Barclays Says

March 01, 2012

Prices (LNGJLNJP) of liquefied natural gas will remain “strong” as production capacity slows and demand emerges in new markets, Barclays Plc (BARC) said in a report.

Aggregate supply additions in 2012 and 2013 will decline to 16 billion cubic meters a year, compared with supply expansion of 106 billion from 2009 to 2011, led by Qatar, London-based analyst Tim Whittaker said in the report. Global expansion of import capacity has continued, with another 77 billion expected to come online this year and next.

“Liquefaction capacity additions will slow sharply in 2012-13, with regasification capacity outpacing supply additions by a factor of four-to-one,” Whittaker said. “This will provide a significant number of new potential destinations for cargoes, and we expect LNG prices to remain strong.”

Europe will lose 3 billion cubic meters a year of LNG in 2012, Barclays said. “While this does not mean a supply shortfall in aggregate, it suggests that European natural gas prices will be higher.”

To contact the reporter on this story: Dinakar Sethuraman in New Delhi at dinakar@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net


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