According to Reuters, ConocoPhillips is confident that the recently weak global LNG prices are only a short-term issue.
Whilst attending an industry conference in Australia, Ryan Lance, Chief Executive of Conoco Phillips, stated that, “LNG prices are pretty weak right now, but we believe it’s a short-term phenomenon.” Lance continued, “we just came out of a mild northern hemisphere winter. We believe that demand growth will absorb the current supply excess that exists in the market today.”
Additional comments from Lance included the characterisation of the industry as “a buyer’s market today”, and the expectation that current oversupply would tighten by the mid-2020’s. Lance expects that soon producers will need to construct additional new plants and therefore return to seeking long-term deals, rather than the short-term, spot deals that are currently very popular, in order to finance these projects.
“Longer term contracts between then will satisfy two needs: security of supply for the end users and security of demand for suppliers to underwrite their financial decisions,” Lance said.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/28052019/conocophillips-confident-lng-prices-will-rise-soon/