Traders Bet on Texas Natural Gas Discount Despite US Export Boom
Permian gas prices trade below the benchmark on bottleneck fears
A liquefied natural gas export terminal in Corpus Christi, Texas.
Photographer: Eddie Seal/BloombergNatural gas exports from the US are soaring amid a global shortage of the fuel, but traders are betting that producers in one of the biggest shale basins will be selling their supply at a discount next year. The culprit: A lack of pipelines.
Companies including Kinder Morgan Inc., Energy Transfer LP and MPLX LP, which own and operate massive networks of conduits stretching from coast to coast, are proposing or moving ahead with projects that would collectively move almost 6 billion cubic feet of additional gas to terminals shipping liquefied natural gas from the Gulf Coast. That’s equivalent to nearly 6% of current US gas production. The pipelines will lift US gas exports to a fresh record and help tame prices in Asia and Europe, which have been running red-hot since Russia’s invasion of Ukraine.