The first tanker with the American gas went to Europe

The first tanker carrying liquefied natural gas (LNG), went from the U.S. to Europe, according to The Wall Street Journal. Ship called the Creole Spirit should arrive to the coast of Portugal in late April. As noted by the WSJ, the supply of natural gas from the USA can “to stir up the European market long dominated by Russia.” Analysts predict that the arrival of the American fuel could trigger a price war that will lead to lower prices for consumers, writes the edition.

“This is the beginning of a price war between us LNG and pipeline gas,” says Société Générale analyst Thierry Bros.

The United States began to export gas from the Northern coast of the Gulf of Mexico in February of this year. Then the Houston energy company Cheniere Energy has posted the first batch of gas to Brazil. Now the Portuguese company Galp Energia signed an agreement with Cheniere for the first European delivery, reports the WSJ citing close to the deal source. It is expected that the tanker will arrive at the Portuguese port of sines on April 26.

Galp Energia and Cheniere Energy declined to comment to the publication.

It is expected that Europe will become a big market for American gas, notes the WSJ. Company Cheniere signed long-term contracts with several European gas companies, including British BG Group, which this year bought Royal Dutch Shell PLC, as well as with the Spanish Gas Natural.

According to analysts, which refers to WSJ, to try to get rid of competition in Europe, Russia can reduce the price to its European customers. Based on current fuel prices, U.S. LNG delivered to Europe, cost about us $4.3 per million British thermal units, according to the estimates of the Argus. Russia sells its gas to Europe at an average of $5,8 per million British thermal units. However, analysts say that Russia can sharply reduce prices in a price war, so. that they will fall below $3 per million British thermal units.

As noted by the WSJ, many in Europe see the U.S. withdrawal on the European market more large-scale geopolitical attempt to challenge the Russian leadership in the supply and in energy prices.

The impact [of supplies] American gas to Europe “would be felt gradually, but it really begins to change everything,” says consultant engineer Trevor Sikorski, of Energy Aspects in London. “New [delivery] of LNG will affect reduction of prices, and the loss of volume [of supplies], and their cost might be a bitter pill to swallow” for Russia, says the WSJ interlocutor.