Explosion at Freeport LNG: a positive for the US and a problem for Europe

Explosion at Freeport LNG: a positive for the US and a problem for Europe Natural gas prices in the US fell sharply, in Europe, on the contrary, rose sharply after the American Freeport LNG announced its prospects. The launch of the terminal after the repair is possible not earlier than three months.Freeport LNG, located on the Texas Gulf Coast, handled almost 20% of all foreign LNG shipments from the US last month. Now the fire-damaged export terminal is unable to ship liquefied natural gas to Europe, China and South Korea, but the decline in exports guarantees gas supplies to the extremely scarce domestic market. Competition forces price cuts: in New York, gas for delivery next month fell by 17% (to $7.17).Stopping Freeport LNG deprives Europe of the main source of fuel, as EU countries are actively boycotting gas supplies from Russia after the start of the Ukrainian crisis. Nevertheless, Europe continues to replenish stocks, and demand in Asia is also starting to grow. But it is already clear that the global shortage of LNG is guaranteed to European consumers.Analysts are confident that there will be no long-term negative consequences for the US. However, a reduction in LNG exports always leads to an increase in world prices, only the reaction to the situation is uneven.US gas inventories are still well below normal, 14.6% below the 5-year average and 16.6% below last year. Now it is possible to replenish stocks to a less critical level.Selling is already risky  the situation is too dependent on fundamental factors. A sharp decline in the price of supplies in the Henry Hub triggers a rebalancing of the market: a technical reversal of the price up is possible after consolidation in the $7.50-8.10 zone with the first target in the $9.65 zone and above.So we keep our composure, control the information background and do not risk in vain.Profits to yall!