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Autumn and winter are traditionally characterized by rising energy consumption and, thus, rising prices for energy products. Yet in November we saw remarkable deviations in natural gas prices in key markets, including the US, Europe, and Japan.

United States. The spot price of Henry Hub fell by 15.2 percent in November compared to the previous month. This decline - which was the sharpest monthly drop since December 2014 - interrupted a period of steady growth that started in April.

Europe. In sharp contrast, in Europe the average import border price of natural gas surged by 14.4 percent in November, the most dramatic monthly increase in 17 years.

Japan. And, what about Japan? In Japan, the import price of liquefied natural gas held steady at October's level, halting the upward trend that started in June.

 

Looking to 2017, leading international agencies made the following natural gas price predictions during the second half:

  • The World Bank in its new commodity forecast for 2020-2025 estimated that the price of natural gas will continue to rise, which is safely in line with its expectations for the 2017-2025 period.
  • The IMF adjusted its forecast for the 2017-2025 period, with the latest values exceeding the previous forecasts for several key indicators: Russian natural gas in Germany (4.5 $/1000 m3 instead of 4 $/1000 m3); Indonesian natural gas price in Japan (8.5 $/1000 m3 instead of 7 $/1000 m3) for 2017-2022. The IMF revised upward its estimates for 2017 (3 $/1000 m3 to 3.4 $/1000 m3), and downward (slightly) for domestic American market for the period 2018-2022 (3.3 $/1000 m3 to 3 $/1000 m3).

The falling price of oil and slow down of the global economy reduced demand for natural gas during 2015-2016 and hurt natural gas prices. Perhaps 2017, with healthier expectations in energy and global growth alike, will be a year of positive change for gas prices.

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View more energy-related statistics and visualizations, including the estimated breakeven cost of oil production by countrynatural gas price dynamics and insights from the BP Energy Outlook 2035, or dive deeper into historical commodity prices from the World Bank and IMF or into a general overview of commodity price forecasts.

You can check out other critical commodities, including:

gold | silver | copper | aluminum | nickel | zinc | coal | natural gas | crude oil

As you examine commodity prices and forecasts, you may also be interested in economic forecasts for the G20 countries across the following indicators: GDP growth | inflation | unemployment | government debt | current account balance | external debt.

 

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