Baku, Azerbaijan, Sept.16
By Aygun Badalova - Trend:
US natural gas trade and LNG exports depend on the differential between US and world natural gas prices, US Energy Information Administration (EIA) said in its Annual Energy Outlook.
“Lower world oil prices reduce the competitiveness of US LNG in world markets, while exports to Canada and Mexico are affected more directly by U.S. natural gas prices, with exports falling when natural gas prices rise and increasing when natural gas prices fall,” the report said.
In the EIA’s Reference case, total US exports of natural gas increase to 8.9 trillion cubic feet (Tcf) in 2040, with LNG exports of 6.7 Tcf.
In the High Oil Price case, with higher international natural gas prices, particularly in Asia, US LNG exports are more competitive, according to the report.
“The greater growth in LNG exports in the High Oil Price case increases the call on domestic production, which in turn leads to higher domestic natural gas prices. The increased demand for LNG exports is offset somewhat by lower natural gas exports to Canada and Mexico as prices rise,” the report said.
US exports of natural gas increase in the High Oil Price case to 12.5 Tcf in 2035 and remain near that level through 2040, and LNG exports increase to 10.5 Tcf in 2040.
In the Low Oil Price case, where there is less incentive for LNG exports, total U.S. exports of natural gas increase only to 6.8 Tcf in 2040, with LNG exports of 5.6 Tcf.
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