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    Reuters: Analysis: EU push for spot gas pricing may be short-sighted

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Summary

IEA and several leading banks and energy companies expect global gas markets to tighten in the next two years as rising demand in Asia increasingly competes with European markets. That would narrow the difference between spot and oil-indexed contracts.

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Reuters: Analysis: EU push for spot gas pricing may be short-sighted

European energy firms appear to have gained the upper hand in a bitter gas pricing dispute with Russia and other exporters though their pursuit of market-based pricing could hurt consumers and security of supply in the long run, some experts are warning.

Major natural gas exporters to Europe - Russia, Norway, Algeria and Qatar - sell their gas mostly under long-term contracts that are linked to oil prices.

Because oil prices have remained stubbornly high despite the weak global economy, European power and gas suppliers currently have to buy at high prices linked to oil.

As they then must sell to their customers at lower retail prices linked to the spot market, their profits are being squeezed.  MORE

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