EMEA News
LNG Market Seeing "Temporary Glut" Says Gas Natural
The liquefied natural gas (LNG) market is merely seeing a "temporary glut," according to Spain's Gas Natural CEO Rafael Villaseca, reports Platts.
Despite recent declines in liquefied natural gas (LNG) spot prices and volumes, Villaseca said that he was not worried, as much of the oversupply was due to mild weather in the northern hemisphere in the beginning of the year.
He also noted that other sources have made connections between the overstock of LNG and worries over the reliability and stability of Russian gas delivered through the Ukraine over the winter.
"The spot will adjust rapidly to the non-spot market where volumes are much larger," he said.
"We don't see a drop in demand for the non spot market,"
He added that the company's emphasis on long-term contracts made the company fairly unexposed to spot price volatility.
Gas Natural typically makes medium-term contracts, usually 1 or 2 billion cubic meters per year with end-users.
The company, which is Spain's largest LNG player, effectively has its 2015 and 2016 contractual volume covered, according to Villaseca.
LNG demand is also expected to maintain steady growth, especially as Emission Control Area (ECA) regulations come into effect beginning 2015.
LNG bunker demand is expected to rise to to 35.7 million tons in 2025 and 77 million in 2035.
