In the nearly 60 years since its inception, the LNG industry has changed significantly. Once a market in which cargoes were sold under long-term, point-to-point contracts in dedicated ships, it has evolved into one in which destination flexibility accounts for an increasing share of LNG trade, with more volumes being sold under short- and medium-term contracts. The changes reflect a trend toward the increasing commoditization of LNG, with the similarities between the LNG and crude oil markets becoming apparent. In today’s RBN blog, we look at the differences in how the oil and LNG markets have developed, whether LNG might achieve the same commodity status as oil, and why the major market players may not want LNG to follow the path of its older cousin.
That’s All Right – LNG May Not Join Oil as Global Commodity, But Markets Seem Just Fine With That
