Gas markets may diverge from crude in 2017

A recovery in oil prices will help underpin gas prices in 2017, but the price of the fuels is likely to diverge A recovery in oil prices will help underpin gas prices in 2017, but the price of the fuels is likely to diverge.
By Peter Stewart 14 December 2016 0 24379
Russian Energy Minister Alexander Novak (left) and his Saudi counterpart, Khalid Al-Falih, after the meeting on 10 December. (PA)

Last January, the oil price was dropping like a stone. The lifting of Iranian sanctions was expected to worsen the glut that had resulted from Saudi Arabia’s decision in late 2014 to abandon the swing producer role it had held for 15 years. Oil and gas producers stopped drilling, US shale producers stopped completing wells, and some companies went bankrupt. High stocks hung over the market like the grim reaper.

“What a difference a year makes,” the International Energy Agency (IEA) commented in its latest monthly...

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