30-10-07 The figures for global liquefied natural gas use (LNG) as a proportion of worldwide gas consumption have doubled between 1990 and 2006. Spot sales and short-term transactions for LNG now account for 16 % of the global trade in the sector, said Dr Mostefa Ouki, Manager (Oil and Gas) of the San Francisco-based Nexant.
He was addressing a session at the “6th Doha Conference on Natural Gas” which began at the Sheraton Doha. Ouki was one of the panellists on a session chaired by Qatar Liquefied Gas Company (QatarGas) Chief Executive Officer (CEO) Faisal Al Suwaidi. Ouki highlighted changes down the years in the gas market.

The first structural change in international gas markets included the shifting from a "managed era" dominated by state-owned oil and gas firms and large energy utilities.
"In the 1990s and early 2000s, there has been integration of large international gas players (ExxonMobil for example). There are large electricity and gas groups, a focus on downstream integration and the emergence of spot sales and short-term transactions," said Ouki.

Since 2004 or so, there has been increasing demand for gas even as there has been a tightening of gas supplies.
"There has been a move away from gas trading to negotiated deals. There has been a shift in price expectations. Oil price increases have directly and indirectly had an impact on gas prices," said Ouki.

Protectionism in the EU looms as there are proposals for tightening of electricity and gas regulations regarding supplies to the EU's single energy market, said Ouki. Russia has also emerged as a new player in the sector and will assume a new role in the gas trade and international gas deals.
Gas producers now look out for better deals, not because of any sort of greed but because of prevailing market conditions.

Earlier, opening the session, Al Suwaidi said the world was not running out of energy resources. But each source of energy, be it coal or nuclear power, has its share of economic, political, safety and environmental problems, he said.
"LNG is expected to gain by 10 % each year for the next 10 years. The way our industry does business is changing," said Al Suwaidi.

Qatar for its part is calling for dialogue with regulators and governments.
"We are investing in efficient LNG carriers and asking customers to support public policies," he said.