The gas market leans towards a more balanced position. However, economists from ANZ Bank point to supply risks that could lead to further price rises.
Fear Takes Over Gas Markets
Supply problems are once again the focus of the world Gas market. Strikes in Australia could threaten the relative peace in world gas markets after Russia’s invasion of Ukraine last year.
Workers at several Western Australian LNG facilities operated by Chevron and Woodside are threatening to strike over wages and conditions. Three large facilities in this country supply around 10% of the world supply, and the impact on the market will depend on the duration of any interruption.
The impact will initially be felt in Asia. Most of the contracted supply goes to Japan, but China also receives a sizeable share. The supply reduction could trigger a bidding war between Europe and Asia.
This comes at a time when the market is leaning towards more balanced positioning. If the outage lasts longer than a month, it is likely to affect the balance between supply and demand during the winter, leading to a revaluation of the market and a further rise in prices.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
