The research division of the American investment bank Morgan Stanley increased its predictions for liquefied natural gas prices in 2023 and 2024, and the research note indicated that increased demand from Europe will intensify global competition and lead to a shortage of supplies next year. The bank also believes that the average price of liquefied natural gas in Asia will reach $39 per million British thermal units (MMBtu) in 2023.
Compared to previous predictions of $30 per million British thermal units, the rate for the next year will be $50 per million BTUs.
The bank also increased its projection for LNG prices to $34.50 in 2024 because Europe would need more LNG to replace Russian oil shipments in the summer of 2023 when storage will be refilled.
Even though Russia reduced its supplies to the continent, Europe filled its reserves for this winter to 90%, and Morgan Stanley warned that, in the majority of cases, European gas stockpiles for the winter of 2023–24 may remain below average.
According to Bloomberg analysts, European LNG imports could increase by 45%–50% this year. To help prevent a potential recession, European Commission leaders are debating the idea of imposing a cap on gas prices across the EU. Commission President Ursula von der Leyen said this week that she was prepared to make such a proposal, despite the commission’s prior appearance of resistance.
The bank stated in the research report that the demand from China, which is projected to rebound from the Corona shutdown to make up for the drop in imports from other Asian countries, is what underpins the rise in natural gas prices to such levels.
The forecasts for natural gas prices in 2023 and 2024 are increased by Morgan Stanley.
About Author
