RasGas-Petronet deal heralds a new era for LNG

Buyers, not exporters, are now in command of an oversupplied market, as a new Qatar-India supply agreement shows

If you needed convincing that the global liquefied natural gas (LNG) market is shifting, look at Qatar's new deal with India's Petronet LNG. Supplier Rasgas has slashed term-LNG prices for its Indian customer, which won't have to pay a penalty for lower-than-agreed purchases in 2015, either. It's another sign that customers are in command of the glutted market. The new deal cuts the price of Rasgas's LNG sales to Petronet by half, to $6-7 per million British thermal units (Btu), very near spot LNG prices. The new price will be based on a three-month average price of oil, replacing a five-year average, and will also be indexed against Brent crude, not the basket of oils imported by Japan (nic