LNG Pricing Differences across the Atlantic - a Comparison between the United States and Europe

Transcription

1 LNG Pricing Differences cross he Alnic - Comprison beween he Unied Ses nd Europe Virginie Krone Micel Ponce Anne Neumnn Universiä Posdm 37h IAEE Inernionl Conference, New York June, 15-18, 214

2 Ouline 1. Moivion 2. Deerminns of LNG Prices 3. Mehodology 4. D 5. Resuls 6. Conclusion IAEE - June 17h,

3 How does he IEA see he fuure? Nurl gs demnd projecions o 235 Europen Union nurl gs supply nd demnd blnce Chin nurl gs supply nd demnd blnce Source: IEA WEO 213 IAEE - June 17h,

4 How does he EIA see he fuure? World energy consumpion by fuel ype World nurl gs consumpion by economic secor World elecriciy generion by energy source Source: EIA, Inernionl Energy Oulook 213 IAEE - June 17h,

5 Reserch Quesion LNG Lnded Prices s of Oc.213, Source: FERC, Which fcors deermine LNG impor prices in he differen world regions? 2. How do deerminns ffec regionl LNG impor prices? 3. Cn price differences be explined by he impc of he deerminns on LNG impor prices? IAEE - June 17h,

6 Ouline 1. Moivion 2. Deerminns 3. Mehodology 4. D 5. Resuls 6. Conclusion IAEE - June 17h,

7 Deerminns of LNG Impor Prices Min differences in price deerminns: Price mechnisms Poliicl nd environmenl fcors Impors dependency Liquidiy spo mrkes Fundmenl Fcors Supply Domesic producion Number of mrke suppliers Sorge cpciy nd levels Avilble resources Demnd LNG consumpion Impor cpciy CO 2 price Economic growh Finncil Mrke Fcors Spo prices - Nurl gs - Crude oil Fuures Exernl Fcors Evens of poliicl nure Acs of nure Temperure Sources: Brown nd Yucel(28), Hmilon (23)nd (28), Breienfellner e l. (29), ECB (28), OECD (24). IAEE - June 17h,

8 Ouline 1. Moivion 2. Deerminns 3. Mehodology 4. D 5. Resuls 6. Conclusion IAEE - June 17h,

9 Vecor Auoregression (VAR) IAEE - June 17h,

10 - 1 - IAEE - June 17h, 214 Srucurl Vecor Auoregression (SVAR) + Σ = cons ipi oil sp price prod hdd cons ipi oil sp price prod hdd A cons ipi oil sp price prod hdd ε ε ε ε ε ε ε 2 1/ 2 1/ 2 1/ 2 1/ 2 1/ 2 1/ 2 1/

11 Ouline 1. Moivion 2. Deerminns 3. Mehodology 4. D 5. Resuls 6. Conclusion IAEE - June 17h,

12 Implemened D IAEE - June 17h,

13 Ouline 1. Moivion 2. Deerminns 3. Mehodology 4. D 5. Resuls 6. Conclusion IAEE - June 17h,

14 Impulse Response Anlysis I.4 US Temperure Shock.15 EU Temperure Shock monhs monhs US Domesic Producion Shock EU Domesic Producion Shock monhs monhs IAEE - June 17h,

15 Impulse Response Anlysis II.4 US Indusril Producion Shock EU Indusril Producion Shock monhs monhs US Demnd Shock EU Demnd Shock monhs monhs IAEE - June 17h,

16 Impulse Response Anlysis III.4 WTI Oil Price Shock.5 Bren Price Shock monhs monhs Henry Hub Price Shock EU Spo Prices Shock monhs monhs IAEE - June 17h,

17 Ouline 1. Moivion 2. Deerminns 3. Mehodology 4. D 5. Resuls 6. Conclusion IAEE - June 17h,

18 Conclusions How do deerminns ffec regionl LNG impor prices? EU bsorbs demnd/supply shocks quicker US bsorbs spo price shocks quicker Lrges responses: US: chnges in nurl gs spo price EU: Demnd / nurl gs spo price Cn price differences be explined by he impc of he deerminns on LNG impor prices? Only prilly Furher reserch needed: Include poliicl specs, sorge levels, CO 2 prices, ec. Long run SVAR Modelling of differen price mechnisms IAEE - June 17h,

19 THANK YOU FOR YOUR INTEREST! QUESTIONS? SUGGESTIONS? Universiä Posdm Augus-Bebel-Sr Posdm, Germny IAEE - June 17h,

20 Seleced References Breienfellner, A., J. C. Curesm, nd C. Keppel (29). Deerminns of Crude Oil Prices: Supply, Demnd, Crel or Speculion? Monery Policy & The Economy Q4, Brown, S. P. A. nd Yucel, M. K. (28). Wh Drives Nurl GsPrices? The Energy Journl, 29(2):45-6. ECB (28). Assessing he Fcors Behind Oil Price Chnges. Technicl repor, Europen Cenrl Bnk, Working Pper Series No Hmilon, J. (23). Wh Is n Oil Shock? Journl of Economerics, 113(2), Hmilon, J. D. (28). Undersnding Crude Oil Prices. NBER Working Pper Series, Nionl Bureu of Economic Reserch (14492). Hrley, P. R., Medlock, K. B. III (214). The Relionship beween Crude Oil nd Nurl Gs Prices: The Role of he Exchnge Re. The Energy Journl, 35(2): Hrley, P. R., Medlock, K. B. III, nd Roshl, J. E. (28). The Relionship of Nurl Gs o Oil Prices. The Energy Journl, 29(3): Kilin, L. (29). No ll Oil Price Shocks re like: Disenngling Demnd nd Supply Shocks in he Crude Oil Mrke. Americn Economic Review, 99(3): Lükepohl, H. (24). New Inroducion o Muliple Time Series Anlysis. Springer. Lükepohl, H. (211). Vecor Auoregressive Models. Europen Universiy Insiue WP ECO (3): Mxwell, D. nd Zhu, Z. (211). Nurl Gs Prices, LNG Trnspor Coss, nd he Dynmics of LNG impors. Energy Economics, 33(2): OECD (24). Oil Price Developmens: Drivers, Economic Consequences nd Policy Responses. Technicl repor, Orgnision for Economic Co-operion nd Developmen, Economics Deprmen,Working Ppers No OECD/IEA (213). World Energy Oulook 213. Technicl Repor, Inernionl Energy Agency, Pris, Frnce. Sims (198). Mcroeconomics nd Reliy. Economeric, 48: SCorp (211). Time Series Reference Mnul. In S Quick Reference nd Index, Relese 12. Sock, J. H. nd M. W. Wson (21). Vecor Auoregressions. Journl of Economic Perspecives 15(4): Villr, J. A. nd F. L. Jouz (26). The Relionship Beween Crude Oil nd Nurl Gs Prices. Energy Informion Adminisrion, Office of Oil nd Gs, IAEE - June 17h,