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Gas prices to go up-I: Bad news for GAIL
Jul 20:
What are the expectations on oil prices and gas prices for the rest of 2017 and 2018?
8The expectations are lower than what they were last month by an average of $ 2/bbl and $ 4/bbl for 2017 and 2018. This seems to be the outlook despite the production cut being undertaken by OPEC.
8Henry Hub natural gas spot prices are forecast to average $3.10MMBtu in 2017 and $3.40/MMBtu in 2018, compared with a 2016 average of $2.51/MMBtu, which was the lowest annual average price since 1999.
8If HH prices are higher, and crude prices are lower, GAIL's prospects for unloading US LNG cargoes to India are not very rosy.
8GAIL's breakeven delivered price of LNG in India out of its committed US offtake will go up and become less competitive. Up to a $ 3/mmbtu differential is possible, indicating that this will reflect very adversely on GAIL's balance sheet.
8A lot will also depend on how ExxonMobil, Qatar and Shell price their short term spot cargoes aimed at India from next year onwards
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8The expectations are lower than what they were last month by an average of $ 2/bbl and $ 4/bbl for 2017 and 2018. This seems to be the outlook despite the production cut being undertaken by OPEC.
8Henry Hub natural gas spot prices are forecast to average $3.10MMBtu in 2017 and $3.40/MMBtu in 2018, compared with a 2016 average of $2.51/MMBtu, which was the lowest annual average price since 1999.
8If HH prices are higher, and crude prices are lower, GAIL's prospects for unloading US LNG cargoes to India are not very rosy.
8GAIL's breakeven delivered price of LNG in India out of its committed US offtake will go up and become less competitive. Up to a $ 3/mmbtu differential is possible, indicating that this will reflect very adversely on GAIL's balance sheet.
8A lot will also depend on how ExxonMobil, Qatar and Shell price their short term spot cargoes aimed at India from next year onwards
Click on Reports for more
