Oxford Energy Podcast touches upon various topics related to the energy industry. Each episode of the podcast is different but in one of the latest ones David Ledesma and James Henderson discussed the key messages from the Quarterly Gas Review published not long ago.
Who are the hosts of the podcast?
David Ledesma is the main host of the Oxford Energy Podcast. He is an independent gas and LNG consultant and his primary focus is natural gas worldwide and LNG strategy. He joined the Oxford Institute for Energy Studies in 2007. Since then he has been taking an active part in writing and editing many of the Institute’s books. The has also published numerous papers talking about the energy industry. Some of his most well-known papers include:
- ‘The Changing Relationship between NOCs and IOCs in the LNG Chain’ – published in July 2009
- ‘East Africa Gas – Potential for Export’ – published in March 2013
- ‘The Future of Australian LNG Exports: Will Domestic Challenges Limit the Development of Future LNG Export Capacity?’ – published in September 2014
- New Players New, Models a research think piece – published in March 2019.
David also talks about gas and LNG at European and International conferences and he has extensive experience in negotiating at the government level, delivering big energy projects, and managing joint ventures.
In the discussed podcast David is joined by James Henderson who is a Director of the Natural Gas Programme at the Oxford Institute for Energy Studies. He has been appointed to this role in 2016. Since then he has been conducting research into gas and oil programmes focusing on Russia, as well as the global energy matters that affect the region. He has published numerous papers on the Russian oil and gas sectors and on how they connect with the global energy economy. Some of these major publications include:
- a paper on the future of Russian oil production
- a paper on Arctic oil
- a paper on Russia’s gas export strategy
- a book on ‘International Partnership in Russia.’
James’s main areas of expertise are the Russian oil and gas sector, foreign investment and influences in the Russian energy sector, and global gas issues.
What is the Oxford Institute for Energy Studies?
The Oxford Insitute for Energy Studies is a world-leading independent and autonomous energy research institute. It was founded in 1982 and it specialises in producing high-quality expert research into the economics and politics of international energy in oil, gas, and electricity markets. The Institute publishes a unique analysis of trends in the global energy market and encourages debate about global energy issues. The research of the Oxford Institute for Energy Studies is centred around four key areas:
- Oil
- Gas
- Electricity
- China.
The findings of the research are published as books, research papers, and comments from experts in the energy industry. They are also presented at various international conferences and in conversations with governments, academics, and policymakers.
To stay connected, follow the Institute on Twitter.
What is the Quarterly Gas Review?
As the Oxford Institute for Energy Studies explains, ‘Quarterly Gas Review is a quarterly publication from the Gas Programme that tracks key metrics in international gas markets, providing analyses and commentary on their implications for all stakeholders in the energy sector.’
From the podcast, listeners can find out insights into market trends and factors affecting prices. The podcast also offers forecasts for 2025 on how the energy industry will be changing.
Key predictions for 2021
In the podcast, David and James talk about 10 key themes that were mentioned in the Quarterly Gas Review published in January 2021. Since then, the discussed themes have been shaping the outlook for the global gas sector and will continue to do so for the rest of the year. Have a look at the discussed themes:
- Recovering from the COVID-19 pandemic
The COVID-19 pandemic has severely affected the energy sector. The Oxford Institute for Energy Studies estimated that the global gas demand has been in decline of between 1-1.5 per cent because of the pandemic. Nevertheless, in China and some other Asian countries, growth in demand could be observed because of exceptionally cold winter.
The Quarterly Gas Review predicted that the gas demand in Europe in 2021 would be quite big, especially in the first quarter because of the likelihood of lockdowns still being in place. In 2021, the European demand could get back to the levels that could be observed in 2019. Overall, globally, the Review predicted that the global gas demand would rise by 2.5-3 per cent throughout the year.
- Gas storage as a market indicator
Gas storage allows the European market to receive greater volumes. Changes in gas storage stocks that can be observed each year are an indicator of the current state of the market. High stock levels indicate a loose market, while low stock levels indicate a tight market.
The prognosis for 2021 was that European storage withdrawals could happen because of the COVID-19 pandemic.
- Progress on Nord Stream 2 can be compromised
The podcast says that the Review predicted sanctions imposed by the US for pipe-laying, for the provision of underwriting services or insurance, and for other services related to building the offshore gas pipeline system.
- The role of coal will decline
As the hosts of the podcast explain, the Quarterly Review predicted that the role of coal in the electricity generation mix would keep declining in Europe, as it has been for the last few years. In 2020, Europe saw an 18 per cent decline in the demand for coal. Overall, this trend is likely to continue and even accelerate in 2021.
Nevertheless, the Review also predicted a short-term coal recovery in 2021 caused by higher demand for electricity and rising gas prices.
- China’s 14th Five Year Plan
In March 2021 the Chinese government announced its 14th Five Year Plan that outlined the country’s goals relating to natural gas for the next five years. The Review predicted that this event would affect LNG flows.
Do you know what the Five Year Plan is?
As Carbon Brief explains, it’s ‘A five year plan, or FYP, is a comprehensive policy blueprint released by China every five years to guide its overall economic and social development.’
- Liberalisation of the Brazilian gas marker
Brazil has been trying to increase the share of natural gas in its energy mix. In 2021 and the years to come the gas demand in Brazil is expected to grow, which is likely to affect the dynamics of importing gas from the country. The Review predicted that the year 2021 would be a very important year for the gas sector of Brazil.
- OIES Key Themes for 2020
The last time OIES published key themes for the year 2020, it could not have predicted the COVID-19 pandemic and the impact it would have on the global economy. Some of the projects that the themes concerned had to be put on hold during the pandemic but were likely to be resumed in 2021.
- Decarbonisation Legislation in the EU
The Review expected that 2021 would be a busy year in terms of developing legislation relating to the decarbonisation of gas in the EU. As the podcast explains, the Commission is expected to introduce a series of proposals for legislation but the process is complex.
The most important piece of legislation is the European Climate Law that would amend Regulation EU 2018/1999 to introduce the targets of net zero by 2050 and a reduction in carbon emissions of 55 per cent.
- Carbon Neutral LNG cargoes
Since 2019 carbon neutral LNG cargoes are being sold in some parts of Asia. Their carbon emissions are offset by contributing to renewable projects. The Quarterly Review predicted that in 2021 the production of carbon neutral cargoes would advance not just in Asia but also in other parts of the world.
- Biden’s energy and climate policy
The Review talked about the fact that Biden’s administration was supposed to publish concrete proposals regarding US climate and energy policies. Biden’s policy was expected to deliver big changes to the use and production of energy in the US. Biden also aimed to re-join the Paris Agreement. Thanks to these changes, the two key areas: methane emissions and climate finance were expected to improve significantly in the US and around the world in 2021. If you haven’t yet listened to the podcast, you can do it here. Once you catch up, you can reach out to us on our social media to let us know your thoughts!