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Gas Exporting Countries Forum Needs Pacific Participation to Set Prices The recently-formed producer group known as the Gas Exporting Countries Forum (GECF) will likely require the participation of Pacific nation producers if they are to achieve oil-price parity, said consulting group PFC Energy, as reported by Bloomberg.
The group of 11, of which Russia, Iran and Qatar are the largest members, controls two-thirds of the world’s proven natural gas reserves but will see its share of LNG declining from around 55 percent now to around 45 percent by 2015.
At an April meeting, members could not reach an agreement to collectively reduce production in order to help raise prices.
Global LNG prices are softer than oil due to surplus supply from U.S. shale gas production and the development of new global LNG facilities.
PFC analysts said that for a price-setting group to succeed, the fuel would have to be traded outside long-term contracts and in sectors where few substitutes were available. Secretary General of GECF, Leonid Bokhanovsky, said the forum would not be able to control prices or production for five to ten years because so many supply arrangements were based on long-term contracts. |
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