Crisis in Ukraine diverts attention from major trends in maritime LNG market, analyst says

March 10, 2022

Using Value of ships data, Vivek Srivastava, Senior Trade Analyst, explores rising global gas prices amid events unfolding between Russia and Ukraine.

“The Ukraine crisis has sent global gas prices skyrocketing, but there may be larger forces at work in the maritime LNG market,” Srivastava said in a VesselValue statement. LNG volumes can allay the worst fears.

Europe’s benchmark TTF gas price has risen 135% so far in 2022, with an almost vertical spike since Russia began hostilities in eastern Ukraine on Feb. 24. Russia is the world’s largest gas exporter, and Europe is highly dependent on it, as Russia exports around 23 billion m3 of gas every day, around half of which goes to Germany, Italy, France and Belarus.

“Russia’s share of the seaborne LNG market is certainly large enough to move the needle on the global balance between supply and demand,” Srivastava said. “Among the top 20 export regions over the past 12 months, Russia accounted for two, highlighted in red. The Eurasian Arctic contributed 4% of total volumes and the Russian Pacific an additional 2%. However, there are four much larger export regions, each with double-digit shares: the Gulf of the Middle East (20%), the Gulf of Mexico (14%), Southeast Asia ( 12%) and the west coast of Australia (also 12%). Smaller changes in one of these four regions can outweigh larger changes in the two Russian regions. »