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Russia warns global gas oversupply could trigger price ‘crisis’


Global gas supplies currently exceed demand, a situation that could lead to a “crisis” drop in prices similar to what occurred in the crude oil market, Russian energy minister Alexander Novak said on Friday. “The current excess supply of natural gas brings risks… of entering into the same crisis that affected oil prices,” Novak said at the Gas Exporting Countries Forum (GECF) in Bolivia, where top officials of major gas-producing countries have been meeting this week. Gas prices have plunged more than 80 percent in the last decade and remain under pressure due to growing supplies of shale gas and increased availability of liquefied natural gas (LNG) that can be shipped overseas. Novak said the threats to global gas prices underscore the importance of long-term supply contracts, in which producers can be assured a stable price over the course of years instead of being subject to the ups and downs of the market. Russia is the world’s second-largest producer of natural gas, behind the United States. The United States has vastly increased its output of both crude oil and natural gas in recent years as improved drilling technology opened previously inaccessible reserves – a leading reason for a steep drop in petroleum prices <CLc1> <NGc1>. The GECF, which includes members like Qatar, Iran, Russia and Venezuela, is modelled after the Organization of the Petroleum Exporting Countries (OPEC), whose 12 member nations manage oil supply to control prices. While the GECF has called for increased “cooperation” to defend its gas market, it has not applied production limits as OPEC has done to buoy crude prices.


25 Comments on "Russia warns global gas oversupply could trigger price ‘crisis’"

  1. coffeeguyzz on Sat, 25th Nov 2017 7:49 am 

    There are a number of very good reasons to be concerned – or, at a minimum, aware – of the tsunami of natgas that is both available and heading to market in the coming years.

    Prices that hit $12/$14 mmbtu HH a few years back are now regularly under a buck per at transfer points out of the Appalachian Basin.

    The announcement last week by Telurian of plans to build a 20 train LNG plant in Lake Charles – capable of over 27 million tonnes/year output – at a cost of $15 billion has sent shock waves throughout the global hydrocarbon markets.
    This one plant will not only out produce the $60/$70 billion dollar facilities recently constructed in eastern Australia, it may actually ship LNG to a newly positioned FSRU off Melbourne in the coming years as the imported gas will be much cheaper.

    Absolutely incredible turn of events.

    Coincident to the massive supplies of natgas heading to market, downstream hardware is ramping up to employ this cheap fuel.

    From massive CCGT plants to tiny micro grid facilities providing both heat and power (CHP replacing the Cogeneration labelling), places from Denton Texas, Albany NY, even tiny, remote Watertown, NY are installing these systems for reliable, locally run supply.

    The rapid adoption of the Floating Storage and Regassification Units are enabling remote locations all over the globe to employ this abundant, inexpensive fuel.

    When the Adsorbed Natural Gas technologies reach the point of allowing homeowners to fuel their CNG vehicles right at home, the Age of Oil might be seeing its sunset.

  2. mmm on Sat, 25th Nov 2017 9:56 am 

    “Gas prices have plunged more than 80 percent in the last decade…”
    Such articles seems to me like from another galaxy. I use gas for heating my house in EU with gas from Russia and I pay considerably more than 10 years ago. I can only dream about prices decrease, or even 80% plunge.

  3. dissident on Sat, 25th Nov 2017 10:00 am 

    Indeed, the middle men are raking in the profits. The term “market” is basically meaningless. Neither the crude oil price, nor the gas price is ever seen by the consumer. They see prices set by layers of parasites.

  4. Babtized on Sat, 25th Nov 2017 11:22 am 

    Absolutely right dissident. When oil was $20 a barrel I paid $1.89 per gallon for gasoline. When it was over $100 a barrel I paid $3.09 a gallon. Dam parasite money changers.

  5. Davy on Sat, 25th Nov 2017 11:45 am 

    $3 is cheap considering the real value of gas. Middle men are there for a reason generally. Not sure what the point of the bitch is about.

  6. onlooker on Sat, 25th Nov 2017 11:57 am 

    It is not that the Oil and Gas people are exploiting society or overly it is that Society grew to rely so much on oil and gas. That is a real reason to bitch

  7. Davy on Sat, 25th Nov 2017 2:19 pm 

    Our wise men back in the 20th century believed in techno optimism and that one day we would move beyond fossil fuels. NUK comes to mind. You know George Jetson shit. It was also a matter of competition. If you didn’t build fossil fuel weapons your ass was invaded and assimilated. It really is an issue with human behavior at the end of the day. We have done all this because it is our nature and all of us as part of the human family will pay the price for this clear case of species hubris.

  8. MASTERMIND on Sat, 25th Nov 2017 3:33 pm 

    The post WW2 average price for a barrel of oil was 22 dollars (2017 Inflation Adjusted)…That is about 1.45 a gallon gasoline. Why does nobody on this freaking blog know anything about oil and energy?

  9. Babtized on Sat, 25th Nov 2017 4:23 pm 

    It’s the ratio.

  10. rockman on Sat, 25th Nov 2017 5:01 pm 

    B – I have a solution for your gasoline prices: just build a small distillation unit in your back yard. Then I’ll be glad to sell you any of my oil you want and you can make your own gasoline at cost. Oh, you’ll also need to buy a tanker truck to haul the oil from my well to your house. You could pay a company to deliver it to you like the refineries do but those “parasites” will carve out some profit. Oh, you’ll also have to build some underground tanks to store your fuel in. You could pay a local gas station to store it in their tanks but those “parasites” will carve out some profit too. Oh, wait, you can’t do that either: their fuel has a number of additives. But actually you need to buy those additives any way from the chemical companies like the refineries do since modern car engines require them. Also you need to install meters on your storage tanks that you’ll have to pay a company to certify on a regular basis since you’ll have to pay taxes to your state and federal govt parasites. Depending on where you live that could be as much as high as $0.76/gal if you live in PA.

    So there you go: a way to cut out most of those “parasites” between my well head and your fuel tank. Drop me a line when your truck is ready to swing by my lease and pick up that first load. LOL.

  11. Makati1 on Sat, 25th Nov 2017 5:06 pm 

    Prices go up. Prices go down. Some day they will stop. Game over. But that is not soon. I think that there will be a long taper, where only those who can afford it will be able to consume and that is not going to be the average serf.

    Some companies will finally go bankrupt. Maybe the first domino in the financial collapse? Or will the governments just increase the subsidies? Who knows. Fun to watch, isn’t it? That is, unless you have a career or investments that depends on it continuing.

  12. MASTERMIND on Sat, 25th Nov 2017 5:38 pm 

    Rockman shut the fuck up and post sources if you want to be taken seriously..You right wing dumbshit…

  13. MASTERMIND on Sat, 25th Nov 2017 5:41 pm 


    Fun to watch isn’t it? You think people not being able to make ends meet is fun to watch..Jesus Christ you are one demented sick son of a bitch..People who enjoy seeing others suffer are called psychopaths…

  14. rockman on Sat, 25th Nov 2017 6:01 pm 

    MM – Good point. Here’s a nice basic reference explaining how gasoline is made from oil. It should be helpful for your and the other 6 year olds on the site who also don’t understand the process.

    Also here’s the reference to motor fuel taxes in case your mommy is too busy to show you how to search on the Internet:

    I commend you on your openness to share the fact that you aren’t familiar with even the basics of the petroleum industry. The first step in solving a problem is admitting you have one.


  15. rockman on Sat, 25th Nov 2017 6:17 pm 

    d – The solution for your problem is easier then for B. There are only two sets of “parasites” for you need to eliminate: the pipeline companies and your local utility. I doubt it would be practical to lay your own pipeline from my well to your house. But you can set up a NG compressor on my lease and CNG storage tanks. The just buy a CNG tanker truck and haul it to the CNG storage tank on your lease. Not sure but you may have to pay a tax to your local govt. I’ll let you search for that info.

    So there you go: you can cut out the profits made by those two “parasites”. It will probably just cost you about $1.5 million the first year. And then $20,000 every year: you have to buy NG from me to run your CNG compressor. That’s assuming you get a special license and drive the CNG tanker yourself.

  16. MASTERMIND on Sat, 25th Nov 2017 6:17 pm 

    Saudi Vision 2030 is telling..Why bother to get away from oil if there are 260 Gb?

    Saudi Arabia may be out of oil to export by 2030 – Citibank

    Saudi Arabian oil reserves are overstated by 40% – Wikileaks

  17. MASTERMIND on Sat, 25th Nov 2017 6:18 pm 

    A picture is worth a thousand words. Muslims trading slaves in Libya. Madkat this is what they are going to do to you once society collapses.

  18. MASTERMIND on Sat, 25th Nov 2017 6:21 pm 

    Rockman. Sorry bankrate is not a trust worthy source. You dimwit..Just like your last source Dailycaller. Are you mentally retarded? You are as dumb as madkat.

  19. MASTERMIND on Sat, 25th Nov 2017 6:25 pm 

    Rock I’ll be breeding your daughters post collapse …I’ll tell em turn off that Taylor Swift and open up wide for my big dick!!! I’ll have more kids then Stanford…

  20. Anonymouse1 on Sat, 25th Nov 2017 7:05 pm 

    Looks like its the socks turn to play the ‘crazy one’ tonight. Well played exceptionalist. Makes it appear as if you are ‘sane’ one, at least by comparison, lol.

  21. Makati1 on Sat, 25th Nov 2017 7:22 pm 

    rockman, we have some real educational light weights in here who can only parrot their propaganda sources and have zero experience or knowledge of how the real world works.

    The process from well to gas pump is long and expensive. You didn’t eve mentioned the expenses of actually finding, drilling and pumping. All the equipment that wears out. The experienced labor required, etc. If we go all the way back to the mines…

    Gasoline would be cheap at $20 per gallon if you factor in the labor/energy one gallon represents. Soon, I think, the world is going to find out the true cost of everything and it isn’t going to be pretty or peaceful.

  22. Boat on Sat, 25th Nov 2017 7:23 pm 


    Robots are more efficient than humans and cheaper to fix. You subsidise the poor while I read labels that read made in the US by machine. Quit pissing in a fan and swimming upstream, embrace fighting climate change by replacing humans with machines.

  23. MASTERMIND on Sat, 25th Nov 2017 7:57 pm 


    Your IQ is well past peak age of 25..You need to go watch wheel of fortune and eat your jello…You bugged out like a nutcase..You made your bead and soon you will lay in it.

  24. Boat on Wed, 29th Nov 2017 7:35 pm 

    Russia worried about over supply of Nat gas. Do what they did with oil and cut supplies.

  25. Dredd on Thu, 30th Nov 2017 8:19 am 

    “Russia warns global gas oversupply could trigger price ‘crisis’”

    “US warns Chine to stop oil flow to N. Korea or US will” (The Peak Of The Oil Wars – 13).

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