S&P: Natural gas price will remain high over the next two years

The price of natural gas will remain high over the next two years, as European countries seek to reduce their dependence on natural gas of Russian origin and to increase the supply of liquefied natural gas (LNG) from the United States. Thus a report by S&P Global Ratings that furthermore, the reopening of the global economy and the energy transition to alternative energy sources will continue to support higher gas prices.
Oil prices will remain volatile as buyers of Russian oil are looking at other possible sources of supply and the EU restrictions will come into effect on May 15th. However, lockdowns in China continue to offset concerns about shortages of supplies from Russia.
While expecting that higher price estimates will lead to an improvement for oil and gas producers at all rating levels in the short term, S&P remains focused on the financial policies of investment-grade issuers and the use they intend to make. of any additional cash flow over the next two years. Many speculative-grade issuers already have very robust credit profiles, with ratings locked pending an improvement in their corporate risk profiles. Consequently, S&P does not expect any short-term changes in oil & gas prices to translate into widespread upgrades of the E&P (exploration & production) segment.