Will Natural Gas Prices Decouple From Oil Prices Across the Pond?
We show that US natural gas prices have decoupled from oil prices following substantial institutional and technological changes. We then examine how this interrelationship has evolved in Europe using data for Algeria, one of Europeâ€™s key gas suppliers. Taking into account total gas exports and cyclical conditions in partner countries, we find that gas prices remain linked to oil prices, though the nexus has loosened. Both high oil prices and a modest industrial recovery in partner countries have kept gas exports at low levels in recent years, suggesting changing market forces. The paper then shows how such shifts can have important macroeconomic implications for a big gas exporter such as Algeria.
|Date of creation:||01 Jun 2011|
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Brown, Stephen P. A. & Yücel, Mine K., 2007.
"What drives natural gas prices?,"
0703, Federal Reserve Bank of Dallas.
- Anne Neumann, 2008.
"Linking Natural Gas Markets: Is LNG Doing Its Job?,"
Discussion Papers of DIW Berlin
822, DIW Berlin, German Institute for Economic Research.
- Anne Neumann, 2009. "Linking Natural Gas Markets - Is LNG Doing its Job?," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 187-200.
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