International perspectives on energy prices - gas pricing ... · Mai 13 Aug 13 Nov 13 Feb 14 Mai 14...

London

Houston

Washington

New York

Portland

Calgary

Santiago

Bogota

Rio de Janeiro

Singapore

Beijing

Tokyo

Sydney

Dubai

Moscow

Astana

Kiev

Porto

Johannesburg

Market Reporting

Consulting

Events

International perspectives on energy prices - gas pricing in a world of $60/bl crude IFIEC Europe – Energy Forum 2015 Matthew Monteverde 4 June 2015

Commodity prices in abstract

Copyright © 2015 Argus Media Ltd. All rights reserved.

0

100

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700

Okt 01 Okt 04 Okt 07 Okt 10 Okt 13

Index: October 2001 = 100, adjusted for inflation

Commodity prices have declined

NBP DE Power API 2 Ammonia NOLA Henry Hub Brent WTI Gold Ethylene NWE



0

100

200

300

400

500

600

700



US shale gas

NBP DE Power API 2 Ammonia NOLA Brent WTI Gold Ethylene NWE Henry Hub



0

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300

400

500

600

700



German power and the Energiewende

NBP API 2 Ammonia NOLA Brent WTI Gold Ethylene NWE DE Power Henry Hub



0

100

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300

400

500

600

700



UK gas prices exposed to global market conditions

API 2 Ammonia NOLA Brent WTI Gold Ethylene NWE NBP DE Power Henry Hub



0

100

200

300

400

500

600

700



Crude prices held firm before collapse

NBP DE Power API 2 Ammonia NOLA Henry Hub Gold Ethylene NWE Brent WTI



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200

300

400

500

600

700







0

1.000

2.000

3.000

4.000

5.000

6.000

7.000



Rare earths – Chinese law (and law breaking)

NBP DE Power API 2 Ammonia NOLA Henry Hub Brent

WTI Gold Ethylene NWE Neodymium oxide Terbium oxide

Market Reporting

Consulting

Events

Gas prices in a low-oil price world

European price update


30

35

40

45

50

55

60

65

70

75

80

Mai 13 Aug 13 Nov 13 Feb 14 Mai 14 Aug 14 Nov 14 Feb 15 Mai 15

p/th

NBP forward month prices collapse — twice

Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14

Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15

Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15

European gas price update


30

35

40

45

50

55

60

65

70

75

80

01 Mai 01 Aug 01 Nov 01 Feb 01 Mai 01 Aug

p/th

Forward price ranges – 2014-15 v2015-16

GY 13-14 Range GY 14-15



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35

40

45

50

55

60

65

70

75

80


p/th


GY 13-14 Range GY 14-15

Added political risk premium on low

prompt prices



30

35

40

45

50

55

60

65

70

75

80


p/th


GY 13-14 Range GY 14-15


prompt prices End-of-year price collapse



30

35

40

45

50

55

60

65

70

75

80


p/th


GY 13-14 Range GY 14-15



First-quarter rally on lower Russian

receipts, storage



30

35

40

45

50

55

60

65

70

75

80


p/th


GY 13-14 Range GY 14-15



First-quarter rally on lower Russian

receipts, storage

Wider Q2-Q3 spreads than in 2014

European price update


15

17

19

21

23

25

27

29

31

33

35

Mai 13 Aug 13 Nov 13 Feb 14 Mai 14 Aug 14 Nov 14 Feb 15 Mai 15

€/MWh

European front-month gas prices

ES AT CZ Gaspool NBP NCG

Peg N Peg S PSV TTF Zee PolPX

Market Reporting

Consulting

Events

European gas supply

European supply sources


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200

400

600

800

1000

1200

1400

Aug 12 Nov 12 Feb 13 Mai 13 Aug 13 Nov 13 Feb 14 Mai 14 Aug 14 Nov 14 Feb 15 Mai 15

mn m³/d

Western European supply — monthly through mid-May 2015

NL/UK production NO RU N.Africa LNG

Russian supply shortfall


Yamal -3.2bn m³

Wysokoje -3.7bn m³

Velke Kapusany -15.1bn m³

Drozdwicze -2.5bn m³ Beregdaroc +0.1bn m³

Tietierowka -0.1bn m³

Winter 2014-15 v winter 2013-14



-100

-80

-60

-40

-20

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60

80

100

Okt 13 Jan 14 Apr 14 Jul 14 Okt 14 Jan 15 Apr 15

mn m³/d

Russian deliveries to Poland, Slovakia and Hungary v nominations

Drozdowicze Tietierowka Wysokoje Kondratki - Yamal Velke Kapusany Beregdaróc



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-150

-100

-50

0

50

100

150

Okt 13 Jan 14 Apr 14 Jul 14 Okt 14 Jan 15 Apr 15

mn m³/d

Russian deliveries to Poland, Slovakia and Hungary v nominations

Drozdowicze Tietierowka Wysokoje Kondratki - Yamal Velke Kapusany Beregdaróc

Russian under-deliveries to Italy


0

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100

120

Jan 14 Apr 14 Jul 14 Okt 14 Jan 15 Apr 15

mn m³/d

Italian deliveries v nominations

Nominated Delivered

Russian under-deliveries to Italy


0

20

40

60

80

100

120

Jan 14 Apr 14 Jul 14 Okt 14 Jan 15 Apr 15

mn m³/d

Italian deliveries v nominations

Nominated Delivered

-40

-30

-20

-10

0

10

20

Mrz 11 Mrz 12 Mrz 13 Mrz 14 Mrz 15

mn m³/d

Supply shortfall

Nominated

Larger European stockbuild required


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jan Feb Mrz Apr Mai Jun Jul Aug Sep Okt Nov Dez

Aggregate European gas storage

2015 2014 2013 2012 2011 2010

Market Reporting

Consulting

Events

Oil indexed contract prices

Oil indexed price evolution


10

15

20

25

30

35

40

Okt 04 Okt 05 Okt 06 Okt 07 Okt 08 Okt 09 Okt 10 Okt 11 Okt 12 Okt 13 Okt 14

€/MWh

Various oil-indexed contract formulations

Oil index



10

15

20

25

30

35

40


€/MWh


Oil-index range Oil index



10

15

20

25

30

35

40


€/MWh


Oil-index range Oil index TTF m1



10

15

20

25

30

35

40

Okt 04 Okt 05 Okt 06 Okt 07 Okt 08 Okt 09 Okt 10 Okt 11 Okt 12 Okt 13 Okt 14 Okt 15 Okt 16 Okt 17

€/MWh


Historic TTF m1

10

15

20

25

30

35

40


€/MWh


Historic TTF m1 Dec-13 TTF curve

Forward pricing in December 2013


10

15

20

25

30

35

40


€/MWh


Historic TTF m1 Dec-13 TTF curve

May-15 TTF curve

Forward pricing in May 2015


Market Reporting

Consulting

Events

A narrower price channel

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19

20

21

22

23

24

25

26

27

28

Mai 15 Nov 15 Mai 16 Nov 16 Mai 17

€/MWh

Oil index and market prices

EU oil index TTF m1 TTF forward

Forward price channel relatively narrow


18

19

20

21

22

23

24

25

26

27

28


€/MWh

Fuel switching prices remain below the market

EU oil index TTF m1 TTF forward Fuel switching 60pc/30pc

Fuel switching?


18

20

22

24

26

28

30

32

34


€/MWh

Asia-Pacific oil index and EU prices

EU oil index TTF m1 TTF forward Japan LNG (oil index) Fuel switching 60pc/30pc

Asian LNG backstop?


Market Reporting

Consulting

Events

LNG prices and changing supply patterns

Asia-Pacific LNG price formation


-

5

10

15

20

25

Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15

$/mn Btu

Japanese LNG customs prices

Term: Abu Dhabi, Australia, Brunei, Indonesia, Malaysia, Oman, Qatar, Russia, US

Spot: Algeria, Belgium, Egypt, Equatorial Guinea, France, Norway, Nigeria, Peru, Papua

New Guinea, Spain, Trinidad, Yemen



-

5

10

15

20

25

Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15

$/mn Btu

Japanese LNG customs prices v modern oil index






-

5

10

15

20

25

Jan-04 Feb-06 Mrz-08 Mai-10 Jun-12 Aug-14 Sep-16 Nov-18 Dez-20

$/mn Btu







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7

9

11

13

15

17

19

21

Jan-13 Apr-13 Jul-13 Okt-13 Feb-14 Mai-14 Aug-14 Dez-14 Mrz-15

$/mn Btu






5

7

9

11

13

15

17

19

21

Jan-13 Apr-13 Jul-13 Okt-13 Feb-14 Mai-14 Aug-14 Dez-14 Mrz-15

$/mn Btu

Japanese LNG customs prices v modern oil index v ANEA



Gap between Atlantic and Pacific prices is closing


-

5

10

15

20

Jan-04 Mai-05 Sep-06 Feb-08 Jun-09 Nov-10 Mrz-12 Aug-13 Dez-14

$/mn Btu

Japanese oil index v NBP

Oil index NBP

European LNG receipts


-

1.000

2.000

3.000

4.000

5.000

6.000

7.000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

‘000t

Monthly LNG imports

BE FR PT ES UK NL IT

European LNG receipts


-

1.000

2.000

3.000

4.000

5.000

6.000

7.000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

‘000t

Monthly LNG imports

(12) (10) (8) (6) (4) (2) - 2 4 6 8

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

$/mn Btu

NBP-Asia-Pacific oil index

Market Reporting

Consulting

Events

Japanese LNG supply

Japanese long-term supply contracts


0

10

20

30

40

50

60

70

80

90

1969 1972 1976 1980 1984 1987 1991 1995 1999 2002 2006 2010 2014 2017 2021 2025 2029 2032 2036 2040 2044 2047

mn t/yr

Known long-term supply contracts

Osaka Gas Tokyo Gas Tepco Tohoku Electric Chubu Electric

Chogoku Electric Hiroshima Gas Japex JX Mitsubishi

Kansai Electric Nihon Gas Kyushu Electric Nippon Steel Sendai

Saibu Gas Shikoku Electric Shizuoka Gas Toho Gas



0

10

20

30

40

50

60

70

80

90

1969 1972 1976 1980 1984 1987 1991 1995 1999 2002 2006 2010 2014 2017 2021 2025 2029 2032 2036 2040 2044 2047

mn t/yr

Known long-term supply contracts v gas demand

Osaka Gas Tokyo Gas Tepco Tohoku Electric Chubu Electric

Chogoku Electric Hiroshima Gas Japex JX Mitsubishi

Kansai Electric Nihon Gas Kyushu Electric Nippon Steel Sendai

Saibu Gas Shikoku Electric Shizuoka Gas Toho Gas Gas demand



0

10

20

30

40

50

60

70

80

90

1969 1972 1976 1980 1984 1987 1991 1995 1999 2002 2006 2010 2014 2017 2021 2025 2029 2032 2036 2040 2044 2047

mn t/yr

Known long-term supply contracts v gas demand

Australia Brunei Indonesia Malaysia Oman PNG Portfolio

Qatar Russia Trinidad UEA USA USA (new) Gas demand

Market Reporting

Consulting

Events

Coal, China and the slow collapse of prices



0

100

200

300

400

500

600

700





Benchmark coal prices


0

50

100

150

200

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Oct 2001 Dec 2005 Feb 2010 Apr 2014

$/t

Coal prices have fallen since early 2011

API 2 API 4 API 6



50

55

60

65

70

75

80

Jul 14 Aug 14 Okt 14 Nov 14 Jan 15 Mrz 15 Apr 15

$/t

Northwest European prices and key events

Cif ARA

Chinese import tax, ash and sulphur

limits



50

55

60

65

70

75

80


$/t


Cif ARA


limits Chinese trace element limits



50

55

60

65

70

75

80


$/t


Cif ARA



Brent crude bottoms out at $45/bl



50

55

60

65

70

75

80


$/t


Cif ARA



Colombian night-time rail freight

suspension

Brent crude bottoms out at $45/bl

Market Reporting

Consulting

Events

Overcapacity and a change in China

Will overcapacity come out of the market?


-20

0

20

40

60

80

100

0

20

40

60

80

100

120

140

160

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

$/t

Price and historic export growth

Export growth rate API2 annual average

Chinese demand growth has slowed


-15

-10

-5

0

5

10

15

20

25

30

0

500

1000

1500

2000

2500

1965 1968 1971 1974 1977 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013

pc annual growth

mn toe

Historic demand and growth

Growth rate Chinese demand

Coastal power station coal burn is down


2,5

3,0

3,5

4,0

4,5

Jan Feb Mar April May June July Aug Sept Oct Nov Dec

mn t

Coal burn at major coastal plants

2013 2014 2015

The Chinese economy is shifting


0

10

20

30

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50

60

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80

90

100

1960 1970 1980 1990 2000 2010

Value added, pc of GDP

Service sector larger than manufacturing for the first time in 2013

Agriculture Industry Services, etc.

Economic output and coal consumption


0

2

4

6

8

10

12

14

16

18

0 250 500 750 1.000 1.250 1.500 1.750 2.000

GDP (trillion USD)

mn toe coal

2013 coal consumption and GDP

US

India

China

Japan

S. Africa



0

2

4

6

8

10

12

0 125 250 375 500 625 750 875 1.000

GDP (trillion USD)

mn toe coal


US

India

China

Japan

S. Africa



0

1

2

3

4

5

6

7

8

0 125 250 375 500 625

GDP (trillion USD)

mn toe coal


US

India China

Japan

S. Africa



0

1

2

3

4

5

6

7

8

0 500 1.000 1.500 2.000 2.500

GDP (trillion USD)

mn toe coal

Historic Chinese coal consumption and GDP



0

1

2

3

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5

6

7

8

0 500 1.000 1.500 2.000 2.500

GDP (trillion USD)

mn toe coal

Historic Chinese coal consumption and GDP

6x GDP per 500mn toe coal

consumption

16x GDP per 500mn toe coal

consumption

Market Reporting

Consulting

Events

Conclusions

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International perspectives on energy prices - gas pricing ... · Mai 13 Aug 13 Nov 13 Feb 14 Mai 14...

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Transcript of International perspectives on energy prices - gas pricing ... · Mai 13 Aug 13 Nov 13 Feb 14 Mai 14...