Global gas prices could fall 50% on “resilient supply” – Citi
2023.06.07 19:41
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Investing.com – Global gas prices could fall as much as 50% year-on-year as weak demand and resilient supply force European and Asian markets for the fuel to experience the sort of downside already present in , analyst at Citigroup (NYSE:) said in a note issued Wednesday.
“Supply is resilient: global oil and U.S. natural gas production is still climbing while remaining flat for global LNG,” Citi’s analysts said, referring to liquefied natural gas.
“While could be range-bound between $72 and $90/bbl even with the latest Saudi production cut, global natural gas and coal prices have more downside,” they added.
The Citi note said its base case for the third quarter was gas on the U.S. Henry Hub averaging $2.20 per million metric British thermal units; $3.80 on Dutch exchange and $4.80 for the marker for Japan and Korea.
“For TTF and JKM, that would be ~50% below current forwards,” said Citi, projecting levels for the two that could match Henry Hub prices, which are already down nearly 50% on the year.
