Tightening Louisiana market supports Henry Hub

The tightening gas market in Louisiana will buoy prices at the Henry Hub over the coming years, discouraging its use as an index in long-term gas and LNG contracts
By Abhishek Kumar 18 August 2017
The tightening gas market in Louisiana will buoy prices at the Henry Hub over the coming years. (BG Group)

The Henry Hub has gained popularity in recent years as a benchmark for gas prices in the United States and has been used in a handful of pipeline gas and LNG export contracts. However, enthusiasm for using it as a price index is fading fast as fundamentals are affecting Henry Hub prices. The hub is a physical pricing point in its home state of Louisiana, and the supply-demand fundamentals in the state ultimately influence the price. The fact that Louisiana’s gas market is tightening is...

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