Winter 2021-22 is opening with record high seasonal gas prices, as the combination of a strong recovery in demand, extreme weather events and unplanned supply outages have led to tighter markets. Such tensions are a reminder that security of supply remains a major topic for gas markets, only a year after a record drop in demand and oversupplied markets.
The succession of market events over the past year further illustrates the critical role flexibility plays in ensuring security and continuity of supply. Flexible liquefied natural gas trade — alongside other major components of the gas flexibility toolbox such as interconnectors and storage capacity — has been and remains instrumental to adjusting to sharp and unexpected demand swings (both up and down).
Delivering flexible and yet secure supply is likely to become more complex for systems in transition as they switch to low-carbon gas to reach net-zero emission objectives. Regulators should therefore adopt a prudent and scalable approach to market design to ensure security of supply in a transitioning gas system.
This event featured a presentation by Jean-Baptiste Dubreuil and Gergely Molnar, analysts at the International Energy Agency (IEA), on the agency’s new quarterly report, which includes a review of gas security in light of recent supply-related developments and an analysis of short-term gas market evolution to 2022. The discussion that followed was moderated by Kenneth B. Medlock III, the James A. Baker, III, and Susan G. Baker Fellow in Energy and Resource Economics at the Baker Institute and the senior director of the Center for Energy Studies.
Download the IEA’s Gas Market Report, Q4, including the Global Gas Security Review 2021, here.
View the slides from the presentation here.
10:00 a.m. — Presentation
10:30 a.m. — Q&A
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Kenneth B. Medlock III, Ph.D.
James A. Baker, III, and Susan G. Baker Fellow in Energy and Resource Economics; Senior Director, Center for Energy Studies, Baker Institute