Baku, Azerbaijan, July 3
By Leman Zeynalova – Trend:
The main impact of increased US LNG (liquefied natural gas) exports has to do with providing higher volume for spot trading with gas whose pricing is not indexed to oil, Edward Chow, a senior fellow in the Energy and National Security Program at the Center for Strategic and International Studies (CSIS), told Trend.
The expert reminded that even before Donald Trump's election and inauguration as president, the Energy Information Administration forecasted last November that the US can become a net exporter of oil, gas and coal.
“The growth in the US LNG exports was already happening under Obama administration. Trump administration wants to speed up the approval process for additional new LNG export facilities,” he added.
Chow pointed out that the US government has no ability to direct LNG exports to particular markets.
“These are private sector investments and LNG cargoes will go to the highest value markets. Right now these look like South America and East Asia,” said the expert.
He noted that mainly domestic political motives are standing behind Trump’s new energy policy, however, this will not stop politicians from saying that it is aimed at undermining Russia’s energy hold.
“It is difficult economically for LNG to compete in markets currently served by pipeline gas. On the other hand, it depends on cost difference between transporting LNG and pipeline gas, particularly for distant markets or remote sources,” said Chow.
Earlier, the US President Donald Trump said that the country is on the cusp of a new energy revolution.
Trump cited a series of steps the administration has taken to boost energy production and remove government regulations that he argues prevent the United States from achieving “energy dominance” in the global market.
“Together, we are going to start a new energy revolution — one that celebrates American production on American soil,” Trump said in a statement, adding that the US is on the brink of becoming a net exporter of oil, gas and other energy resources.
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