Updated Sep 25, 2024
9/25/24
Egypt’s growing appetite for LNG to balance its domestic natural gas market is making a wild card for international buyers, putting upward pressure on Europe as it navigates winter supply.
Egypt’s plans to become a regional natural gas export hub are on hold as dwindling domestic production and extreme heat increase its dependance on Israeli pipeline and LNG cargoes to meet surging power demand.
Israel is exploring options for building an onshore or floating LNG (FLNG) facility offshore, potentially expanding the country’s lucrative natural gas exports and its foothold in the global market.
Egypt has halted all LNG exports beginning in May as lower domestic natural gas production has forced the North African country to divert supply to local power demand during the summer months.
While LNG demand still remains mostly lax across Europe and Asia, the specter of supply volatility helped stoke global prices Monday as traders reacted to a bevy of attacks in Russia and Ukraine.
Natural gas output from Israel is again poised to increase as Chevron Corp. and its partners plan to invest more in the Tamar field, raising prospects for additional Eastern Mediterranean volumes to reach the global market via Egyptian liquefaction facilities.
Abu Dhabi National Oil Co. (Adnoc) and BP plc are creating a joint venture (JV) focused on Egyptian natural gas production as conflict in Israel and Palestine continues to pressure Eastern Mediterranean energy exports.
Headed into 2024, global natural gas prices have seemingly coalesced around a new normal after a volatile two-year period, but experts warn a tenuous market balance means volatility is likely just around the corner for at least the next year.
Egypt’s LNG exports have bounced back this month after domestic gas shortages and war in Israel have curbed output this year.
Global natural gas prices bounced back Monday, lifted by escalating tensions in the Middle East, where increasing attacks in the Red Sea have impacted commercial shipping operations.