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The Natural Gas Outlook For 2017

Prices Prompt-month gas prices have plummeted, down to the $2.60 mark from the mid-$3.90s we saw in late-December and the $3.20-3.45 range that persisted for so long after that. Interestingly enough, in its February STEO, EIA has maintained its mid-$3.50s projection for average Henry Hub prices for 2017, compared to the January STEO. This is of note because winter increasingly appears unlikely to “show up.” I’m thinking EIA will change this in the March STEO….perhaps lowering its projection for gas prices this year into the mid-$3.20s range. For comparisons sake, ...

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U.S. Gas ‘Pain Train’ May Chug Along as Spring Fever Grips Bears

U.S. natural gas prices are off to the worst start to a year since 2006, and the rout may not be over yet. Eight of 12 traders and analysts surveyed by Bloomberg see futures sliding further after dropping 29 percent so far this year. Three were bullish and one predicted prices would hold steady. Record warmth from the Midwest to the East Coast has decimated gas demand for heating, leaving inventories above normal for the time of year and sending prices plummeting to an eight-month low. While an uptick in ...

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GLOBAL LNG-Asian demand weakens as shoulder season kicks in

Asian spot LNG prices extended their losses for a seventh straight week as demand from key markets in North Asia dipped amid forecasts of a warmer-than-average spring. Spot prices for liquefied natural gas (LNG) for April delivery LNG-AS were pegged at about $6.20 per million British thermal units (mmBtu), about 20 cents below last week’s levels, according to traders surveyed by Reuters. “There is no demand as of now,” a Singapore-based trader said, referring to Japanese and South Korean demand for April cargoes of the supercooled fuel. “They will definitely ...

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China Aviation Oil looks to build long-term ties with independent refiners

Singapore-listed China Aviation Oil targets to consolidate its relationship with China’s independent refineries in 2017 to build a foundation for a sustained and gradual increase in crude oil trading volumes in future rather than a sudden jump, CEO Meng Fanqiu said Thursday, while announcing the company’s 2016 financial result. The company also aims to expand the supply value chain for bunker fuel oil and intends to lift the profitability of jet fuel trading with gradual volume growth, Meng said. Moreover, CFO Wang Chunyan said he expects the global macro-environment to ...

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U.S. Natural Gas Market Bulls And Bears Caged ‘Indefinitely’

The US natural gas market’s fundamental dynamics have evolved into effective circuit breakers that limit upward and downward price pressure. And there is little evidence to suggest the commodity can escape these price-constraining handcuffs anytime soon. The astonishing production volumes unleashed from shale and other tight resource plays starting in the mid 2000’s turned the market upside down and flipped the country from relative scarcity to exporting gas via both pipelines and LNG. The new reality is one where the battle between sources of supply and demand are so evenly ...

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Azerbaijan, future gas supplier to Europe, faces shortfall at home

Ex-Soviet Azerbaijan is on track to send gas to western Europe by the end of the decade, but is having to import supplies to use at home, compounding economic hardship that prompted protests last year. The country contains one of the world’s biggest gas fields, Shah Deniz on the Caspian Sea, but it has presold the next stage of output, due by 2020, to Greece, Italy, Turkey and other states keen to reduce their dependence on Russian gas. At the end of last year, as construction of the pipeline to ...

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Money Talks Louder Than Trump for Iran in Natural Gas Push

Iran Says It’s Focused on Building Persian Gulf Alliances Iran is hard at work gaining a foothold in the global energy market, and it’s not letting U.S. President Donald Trump’s confrontational tone stop it from trying. Political rhetoric is unlikely to turn into tangible impediments for Iran’s s ambition to join Russia and Norway in the ranks of major gas exporters, according to Deputy Oil Minister Amir Hossein Zamaninia. The nation has about $7 trillion worth of gas reserves sitting underground, based on European benchmark prices, and its doors are ...

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Analysis: Diesel, gasoline face ripple effects of India’s demonetization

India’s gasoline demand moved into negative territory in January, posting its lowest growth in four months as the cash shortage following the government’s move last year to demonetize 80% of the country’s legal currency kept a lid on consumption of transport fuels and sales of two-wheelers. While gasoline consumption was a shade lower year on year at 1.81 million mt in January, compared with 1.82 million mt in January 2016, it fell more than 8% from December’s 1.97 million mt. But market participants said they expected demand to bounce back ...

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‘India can be much larger producer, consumer of natural gas’

India has the potential to become a much larger producer and consumer of natural gas by 2022 when it is expected to surpass China in terms of population, a first of its kind Congressional report on India’s natural gas said today. “India’s natural gas plans have implications for a number of issues in which Congress has expressed an interest,” the bipartisan and independent Congressional Research Service (CRS) said in the report. The CRS noted that India could see greater demand for energy with its population expected to be around 1.4 ...

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Russia’s Gazprom Neft back to profit in Q4 after loss a year earlier

Gazprom Neft, the oil arm of Russia’s top gas producer Gazprom, posted 52.7 billion roubles ($918.07 million) in fourth quarter net profit after loss a year earlier. The firm, Russia’s third largest by output, also said its full year net profit rose to 200 billion roubles, up 82.5 percent comparing to 2015. Gazprom Neft said on Wednesday its adjusted EBITDA in the last quarter of 2016 was at 131.3 billion roubles comparing to 92.6 billion roubles the same period a year ago. The fourth quarter sales stood at 474.4 billion ...

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Singapore a ‘great location’ for LNG trading

Singapore is an “obvious location” in Asia to trade financial products related to the liquefied natural gas (LNG) market, according to a top executive at energy giant Shell. Mr Steve Hill, the executive vice-president for gas and energy marketing and trading, told an LNG outlook briefing yesterday: “I think it’s a great location both in terms of the trading community that’s here, the regulatory environment that’s here and all the support infrastructure.” But the challenge now is for the industry to identify the “right product” to use, said Mr Hill, ...

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Hellenic Petroleum Q4 core profit rises 17 pct, beats forecasts

Greece’s biggest oil refiner Hellenic Petroleum reported a 17 percent rise in fourth quarter core profit on Thursday, helped by strong refining margins and exports. Core profit, or underlying earnings before interest, tax, depreciation and amortisation (EBITDA) – stripping out oil inventory holdings – came in at 215 million euros ($227 million), up from 184 million euros in 2015. The figure was above an analysts’ average forecast of 191.8 million euros in a Reuters poll. Including oil inventories and a one-off insurance compensation, EBITDA jumped to 303 million euros, from ...

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Leviathan Partners Ratify $3.75 Billion Gas-Development Plan

The companies that own the rights to Leviathan, Israel’s largest natural gas reservoir, approved a plan to allocate $3.75 billion to develop the offshore site. Israel’s main gas equity index rose the most in almost five months. The partners, led by Delek Group Ltd. and Houston-based Noble Energy Inc., have agreed on a final investment decision, which lays out how the companies intend to spend the funds to develop Leviathan over the next three years, according to a Tel Aviv Stock Exchange filing Thursday. The decision allows the partners to ...

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Moody’s: Global LNG prices to remain capped beyond 2020 on supply/demand imbalance

Moody’s expects global liquefied natural gas (LNG) prices to remain constrained beyond 2020 as a wave of fresh supply capacity comes online at a time when demand from the world’s largest importers is weakening, says the rating agency in a report published today. Moody’s report, “Global Liquefied Natural Gas Industry: Market Imbalance Will Continue Beyond 2020, Keeping a Lid On Prices” is available on www.moodys.com. Moody’s subscribers can access this report via the link provided at the end of this press release. “Strong LNG demand growth from China, India and ...

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Russia’s Novatek says no need to borrow more for Yamal LNG project

Russia’s largest private gas producer Novatek has no need to increase borrowing as it has sufficient funds for investments into its Yamal LNG project, the company’s management said on Wednesday. At a conference call with analysts, Novatek’s chief executive Leonid Mikhelson said his company has already invested $22 billion in Yamal LNG after securing borrowing on both global and domestic markets. He said Yamal LNG, a project to build Russia’s second gas liquefaction plant, will receive another $6 billion in investment this year. Novatek’s chief financial officer Mark Gyetvay, who ...

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