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The end of long-term contracts? Gas price and market dynamics in Central and Eastern Europe

 
: Wachsmuth, Jakob; Breitschopf, Barbara; Pakalkaite, Vija

:

Institute of Electrical and Electronics Engineers -IEEE-; Institute of Electrical and Electronics Engineers -IEEE-, Power & Energy Society -PES-:
EEM 2017, 14th International Conference on the European Energy Market : 6 - 9 June 2017, Dresden, Germany
Piscataway, NJ: IEEE, 2017
ISBN: 978-1-5090-5499-2
ISBN: 978-1-5090-5500-5
6 S.
International Conference on the European Energy Market (EEM) <14, 2017, Dresden>
Englisch
Konferenzbeitrag
Fraunhofer ISI ()
natural gas; pricing mechanism; panel analysis; long-term contract; Central Europe; Eastern Europe

Abstract
This paper analyses the development of natural gas prices in Central and Eastern Europe (CEE) and assesses its drivers. Furthermore, the relation to recent changes in import contracts is discussed. The methodological approach consists of a panel analysis, in which wholesale gas prices in CEE countries are explained by a set of exogenous drivers, and a descriptive part on changes in contracts. The results provide evidence that a decreased share of oil-indexed long-term contracts has significantly reduced gas prices in Central Europe. Accordingly, the evaluation of contracting trends suggests that importing companies in CEE countries tend to replace expiring long-term gas import contracts with short-term agreements.

: http://publica.fraunhofer.de/dokumente/N-461373.html