Gas OPEC has no Prospects to Exist: Foreign Experts
Azerbaijan, Baku, 23 October/ Trend , corr A. Badalova, E. Ostapenko/ Prospects of establishment of gas OPEC as in case of oil cartel, does not seem realistic, analysts interviewed by Trend said.
Qatar, Russia and Iran have agreed to cooperate in signing gas export contracts. These three countries will set up a technical committee which will deal with discussing joint projects covering all cycle of fixing gas prices from geological survey and fuel production to transportation and analyze of markets, according to Aleksey Miller, director of Gazprom. So, one can say that a new gas cartel has been founded which will unite large has producers and exporters and operate on the model of oil OPEC.
"At this time, I don't see a strong case for the formation of an OPEC style cartel one aimed at affecting prices through production quotas," Justine Barden, analyst at the Energy Information Administration (EIA) said to Trend by e-mail.
Russian analysts are of the same opinion and say prospects of establishing gas OPEC are unreal.
The statement of three large gas suppliers on the establishment of so-called gas OPEC is of political character, said Shirvani Abdullayev, analyst at Alfa Bank, one of the leading investment banks of Russia.
"There have been talks about the establishment of gas OPEC for a long time. If gas demand goes up, problem between Europe and US, on one hand, with Iran on the other, will remain in past and they will begin cooperation and Iranian gas can be delivered to Europe and Asia and it will be connected with European market through Turkmen gas," Abdullayev said to Trend by telephone. But it can take place after 10 to 20 years, he added.
"At the moment I would not pay attention to such statements. Affecting gas prices by establishing OPEC of three counties does not see realistic," Abdullayev said.
"If these three countries were connected with each other by transport nodal points, pipelines, they could affect prices pumping oil from one region to another. It is not real to say that these countries will affect gas prices until gas markets of Iran, Qatar, and Russia are not connected," Abdullayev said.
European Union, on its part, sees a threat for gas trade transparency. The better term for sale of such products such as gas is a free and transparent market. European Union will re-consider its energy policy in case Russia, Iran and Qatar establish gas OPEC," he said.
Europe should not be concerned about anything excluding the case when Russia will begin cooperation with North Africa in the sphere of forming gas prices, Abdullayev said.
"The only place connected with the European market is North Africa (Algeria and potential Libya potentially). Iran is very far and it does not have transport communication with the European market," Abdullayev noted.
A new global gas supply model is being developed which will allow to test various scenarios, including cases of constrained supply from various regions or countries, EIA analyst said.
"Preliminary testing of this model indicates that supply restrictions by any country or countries would have relatively mild affects on global gas supplies and prices," Barden said.
With significant gas resources believed to exist throughout the world, supply restrictions in some countries would simply spur development of resources in other countries, he said.
"These replacement supplies would likely be higher cost and thus contribute to slightly higher prices globally, with the more import-dependant gas consumers seeing slightly higher price increases than the rest of the world in a gas cartel scenario," Barden said.
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