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    ANALYSIS: Asia More Attractive Than Europe for Prospective LNG Suppliers

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    The Asian market offers a much more competitive price for liquefied natural gas (LNG) suppliers, compared to Europe, a spokesperson for PLATTS commodity price reporting agency told RIA Novosti Thursday.

    MOSCOW, April 24 (RIA Novosti), Nikita Alentyev – The Asian market offers a much more competitive price for liquefied natural gas (LNG) suppliers, compared to Europe, a spokesperson for PLATTS commodity price reporting agency told RIA Novosti Thursday.

    “From the price perspective Asia is far more attractive than Europe,” Samantha Santa Maria, Managing Editor of North American Natural Gas at PLATT, said in a comment to RIA Novosti, explaining that “even at the highest European price, Japan and Korea, which are the largest LNG markets globally are currently offering more than a $2 premium.”

    The prospects of LNG supplies to Europe got into the media limelight as the US started pushing for Europe’s greater independence from Russian energy imports given the current geopolitical tensions over Ukraine. Santa Maria explained that as of right now, European markets “will definitely have to get more competitive.”

    “Asia would be the initial choice for every LNG supplier. If that leads to excessive supply, the countries which have the exports will be looking for alternative markets and they might just turn to Europe, but not as their first choice,” she concluded.

    Howard Rogers, Director of Natural Gas Research Center at the Oxford Institute for Energy Studiestold RIA Novosti the US shale gas production which ultimately may become the source for LNG exports resulted in “a lot of irrational exuberance.”

    “As prices recover if there’s enough dry shale gas how much would be actually going on stream. Because production would have to cover the domestic demand and also supply these export projects that they are building or we assume they would be building,” Rogers said pointing to the difficulty in assessing how realistic the US LNG exports are.

    He outlined an alternative scenario for Europe’s energy diversification attempt.

    “The research that my colleagues have done suggests that Russia could increase the volumes of supply to Europe and reduce the prices and cause, especially the US LNG suppliers, to scratch their heads and wonder if this was such a good idea after all,” he concluded.

    Speaking at the College of Europe in Belgium’s Bruges earlier Russian EU envoy Vladimir Chizhov also said The European market for US shale gas is unlikely to yield big profits as Europeans would have to raise prices to withstand competition from Asia, adding to confidence that Russian gas holds a secure position in Europe.

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    liquefied natural gas (LNG), Asia
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