Portfolio players have reshaped the LNG market. Their rise has accelerated project sanctioning, deepened liquidity, and blurred the traditional boundaries between sellers and buyers. Yet the balance of risk has shifted. While projects retain revenue certainty through take-or-pay (ToP) clauses, buyers (particularly portfolio traders), now carry the market-cycle exposure. Their flexibility is valuable in tight markets but becomes a liability in periods of oversupply.
Long Term Contracts
Could Russian pipeline gas return to Europe?
An analysis of EU-Russian Long-Term Gas Contracts
The European Union’s ambitious plans to cut Russian gas from its energy mix by 2027, following the aggression of Ukraine, have stirred significant uncertainty around the future of long-term gas supply contracts with Russia’s state-owned Gazprom.
According to the Cedigaz database on long-term pipeline contracts, more than 100 billion cubic meters of gas are tied up in agreements between Gazprom and European buyers, most not expiring before 2030 to 2035.
This begs a pivotal question: could Russian pipeline gas flow back to Europe under these contracts?
LONG-TERM PIPELINE GAS SUPPLY CONTRACTS IN EUROPE: TOWARDS MORE FLEXIBILITY AND SPOT INDEXATION
Cedigaz has released its updated Long-Term Pipeline Gas Supply Contracts in Europe Database.
Unsurprisingly, given the present context of uncertain demand and looming gas bubble, with Europe as a whole well (over?) contracted in long-term supply contracts, the present update shows little difference from the previous, one-year old version. Indeed, no new contract was added to the database.