What the curves are saying

The degree of backwardation or contango in oil and gas markets provides important clues about where prices might be heading in the short-to-medium term.

Market fundamentals have pushed down prices in Asia and North America, where weak seasonal demand could continue through the end of winter. In Europe, the market has seen some colder weather support demand and reduced supply has caused prices to rise.

• Americas

  Gas storage in the US and Canada under little pressure in coming months

• Asia Pacific

  Spot prices in Asia Pacific have continued to fall and demand growth remains weak

• Europe & Russia

  There is potential for a pick-up in European demand

• Middle East & Africa

  Ongoing civil unrest in Yemen remains a threat to LNG supplies

• Nuclear restarts not yet a threat to Japan’s LNG

  Restarts at Japan’s shuttered nuclear plants will start to affect the country’s appetite for LNG over the next 12 to 24 months. However, a drastic drop in import volumes is not expected this year.

• Canada’s LNG export appeal is fading

  Numerous challenges mean the future looks bleak for Canada’s LNG export projects – which could mean a boost in demand for supplies of the fuel from the US.

• UK imports more gas, less coal as prices drop

  The global low oil price environment means oil-linked gas is becoming more competitive against coal for some customers.