The balance between long- and short-term LNG supplies in the European gas industry

The gas industry has been on a rollercoaster ride in recent years. From 2007 until mid-2008, we saw rising energy prices and euphoric markets with a seemingly bright future. The globalisation of gas markets was within reach. The vision two years ago encompassed huge LNG demand growth in the Atlantic Basin and a shift of Middle East LNG from the Pacific to the Atlantic Basin. However, the financial crisis and the subsequent worldwide recession have removed huge volumes of demand from the market, causing an oversupply situation that was even augmented by the US unconventionals. As a result, the global gas industry and hence the European gas industries find themselves in turbulent times which are characterised by a shift from long-term to short-term supplies