Gas Could Be In Even Bigger Trouble Than Oil
NUS CEO Richard Soultanian was quoted on OilPrice.com amid oil and gas price fluctuations.
On prices weakening in the US:
According to Richard Soultanian, president of energy consultancy NUS Consulting Group, prices in the U.S. could weaken further, to $1.50-$1.60 for near-month contracts, before they begin improving later in the year.
On demand and exports to Mexico:
…demand could pick up sooner, at least in some parts of the world and notably the U.S., according to NUS Consulting Group’s Soultanian. He expects increased electricity consumption during the summer season will provide some relief for U.S. gas prices as will gas exports to Mexico. The country is one of the biggest buyers of U.S. gas. With its demand growing as its population grows, Mexico will remain an essential outlet for surplus U.S. gas for lack of enough domestic production.
Those who do a lot of energy trade with China, NUS Consulting Group’s Soultanian says, will feel deeper pain than those less dependent on Chinese exports.
On the coronavirus’ effect on energy pricing:
“Covid-19 is causing oil prices to rapidly decline, which most likely will result in lower 2020 US crude oil production that initially forecast – thereby curtailing some of the production of associated natural gas.”
NUS Consulting Group sees the gas market rebalancing around the middle of 2021 because of the impact of the coronavirus epidemic on global supply and demand patterns. Without it, the market could have rebalanced by the end of this year or the beginning of 2021 at the latest. This means smaller U.S. producers vulnerable to price swings will have to endure one or two more quarters of pain.
For full article and quotes on OilPrice.com, visit https://oilprice.com/Latest-Energy-News/World-News/Gas-Could-Be-In-Even-Bigger-Trouble-Than-Oil.html