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Pressure on Gas Prices Helping Drive Coal Switch: JP Morgan

NATGAS

Global natural gas prices will face pressure through the end of the decade amid rapid growth in supply and shipping, particularly in Qatar and the US, according to Reuters citing a JP Morgan report.

  • This growth in gas output will help to aid efforts to transfer industries from coal to gas, the bank said.
  • JP Morgan forecasts 2% annual growth in natural gas production by 2030 to 4,600 Bcm, compared with 4,000 Bcm in 2022, creating a 63 Bcm supply overhang.
  • "We see a downward global LNG price trajectory with increased volatility driven by a structurally oversupplied market," J.P. Morgan Global chief global energy strategist Christyan Malek told Reuters.
  • Oil majors expect a further rise in natural gas demand as industries move away from coal to cut greenhouse gas emissions, with the upside potential for coal to gas switching on LNG demand underestimated, Malek told Reuters.

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