Natural Gas Outlook - Year II - Issue 1 – March 2010

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Natural Gas Outlook - Year II - Issue 1 – March 2010

published on 03-23-2010

In this issue:
ref forecasts

  • Demand
    The remarkable rebound of the Italian industrial production and the particularly long winter are driving the national demand for natural gas towards 82 Bcm during GY09. Average temperatures and low macroeconomic growth are instead driving downwards the forecasts for gas demand during GY10. Demand increases could be confirmed in the next gas year indeed assuming an High scenario.

  • Supply
    The increase in the average daily import capacity up to 331 Mcm, obtained during 2009, will determine, both in the present and in the next gas year, a lower than usual load factor of import infrastructures (63% in GY09, 60% in GY10). REF forecasts suggest an increase of import quotas for all wholesale players except ENI, which instead could gain from a higher than expected level of gas demand during GY10.

  • Wholesale prices
    The increasing oil price scenario, together with the still low level of gas demand, push the average gas price at PSV around 24 €c/cm during GY09, while the gas release quotations reach 27.5 €c/cm. Two alternative market forces are driving GY10 prices: increasing oil prices are driving up import cost and thus equilibrium prices, but on the other hand higher competitive pressure, driven by persisting low demand, are pushing for higher spread with indexed formulas.

Key issues

    1. The crisis and the Third Package: the market leader at the crossroads
    2. Perspectives for the Italian gas exchanges
    3. The evolution of the balancing and market systems in Europe
    4. Can the present gas year be considered really cold?
    5. New infrastructures

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