The article discusses the impact of the pandemic on the supply and demand of natural gas and LNG in Europe, the USA and Asia-Pacific. The global economic crisis that followed COVID‑19 pandemic significantly accelerated the decreasing trend of gas prices on regional markets that began in 2019, with regional spot gas prices have become almost equal. The article contributes to the existing studies in three main aspects. First, it provides evidence that the current crisis emphasized the growing role of US LNG as a balancer of the emerging global gas market due to the relatively high share of flexible spot contracts and the tight integration of US export and domestic gas markets. Second, the article concludes that supply competition between pipeline gas and LNG producers, as well as within these groups of suppliers, should be expected to increase both in the short and the long term. Although in the current market environment investments in most projects of gas liquefying terminals have been postponed, as demand and gas prices recover, these projects could be quickly resumed, taking into account continued improvement of LNG technologies, reduction of project implementation time as infrastructure develops, and availability and relatively low cost of financial resources. Third, the article shows that the excess of gas supply and the rapid development of LNG projects have accelerated the ongoing transformation of the pricing system and contract structure in the emerging global and regional natural gas markets over the past few years. The role of portfolio players in the LNG market continues to grow with these players becoming the institution that links together different gas contracts with various pricing mechanisms. The article also analyses the changing structure of natural gas derivatives market. It shows that the accelerating growth of JKM and TTF derivatives supports the development of global LNG market and provides portfolio players with much needed instruments for effective risk management techniques which are becoming increasingly important.
natural gas, LNG, COVID‑19, gas derivatives, Henry Hub, JKM, TTF
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