This week we have seen a tick up from the three-year lows mostly due to technical indicators and increased buying activity with the March-24 contract expiring. The relative strength index was over-sold which spurred some buying demand. However, the fundamentals still remain comfortable with stable supply despite an unplanned outage in Norway and demand is expected to be lower with mild temperatures over the coming days and increased renewable output.
In other news, Qatar announced plans for expanding its liquefied natural gas (LNG) production by 85% which could see them have nearly 25% share of the global market by 2030. LNG output from its North Field’s is expected to increase to 142 mtpa from 77 mtpa by 2030. With the additional 16 mtpa the global market is expected to have 200 mtpa of new capacity by the end of the decade. This latest move is likely to have an impact on global projects given Qatar’s edge as the world’s lowest cost producer and potentially squeeze out rival projects including the United States where President Biden paused new export approvals. ICIS believe the new expansion is expected to lead to a period of more stable, lower prices across the rest of the decade and would encourage greater take-up of LNG from Asian buyers.
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