Global Energy Perspectives: Gas supply security outlook

Caspian Conran sets out his 3 key things to consider when it comes to forecasting gas security this winter: the ability to source LNG, infrastructure constraints and weather conditions.

Outlook #1: The ability to source LNG

Baringa’s analysis of winter gas scenarios identifies LNG as the main sensitivity this winter.

Those exposed should:

• Watch LNG markets as a leading indicator for gas availability in Europe.
• Prepare demand curtailment plans where possible.
• Understand your assets place in the tiering of involuntary rationing if that was to occur.

Read our full analysis on the role of LNG.

Watch Caspian Conran discuss this perspective:

Outlook #2: Infrastructure Constraints

Baringa’s analysis of winter gas scenarios identifies that EU–24 regasification capacity is insufficient to accommodate EU-24 demand. This has led to foreign dependencies on markets like the UK and created major price divergence between national gas hubs.

Clients should:

• Prepare for UK-EU flows to fall as global gas markets tighten.
• Expect major price divergence to continue until EU-24 regasification capacity has increased sufficiently, not likely until the summer of 2023.

Read our full analysis on infrastructure constraints.

Watch Caspian Conran discuss this perspective:

Outlook #3: Winter Weather Conditions

Baringa’s analysis of winter gas scenarios identifies that demand management in Europe is contingent on an average winter. Colder weather in Europe or Asia is expected to undermine EU attempts to manage gas demand, representing a significant downside risk for energy markets.

Clients should be aware of this downside potential when evaluating the credibility of member state demand reduction targets.

Read our full analysis on the impact of winter weather conditions.

Watch Caspian Conran discuss this perspective:

For more information on the contents of our latest Global Energy Perspective or how Baringa can help your organisation, please contact us.