INSTITUTIONAL PRECONDITIONS AND GENESIS OF NATURAL GAS EXCHANGE TRADING
##plugins.themes.bootstrap3.article.main##
##plugins.themes.bootstrap3.article.sidebar##
Abstract
Natural gas is one of the world's leading sources of primary energy, and gas exchanges are key players in the natural gas market, which ensure its functioning on a liberal basis. Given the current liberalization trends, exchange trading in natural gas is gaining momentum and importance in this market. The main objective of the study was to determine the institutional preconditions and the main stages of the genesis of the exchange segment of natural gas trade. The study showed that gas exchanges and gas hubs are the key institutions of natural gas exchange trading, as they ensure openness and transparency of the market. As a result of the study, the author identified the following institutional prerequisites for the creation of gas exchanges: the need to form a competitive gas market and ensure its availability to third parties, ensuring transparent pricing and setting the market price for gas, simplification of trade procedures and standardization of products, protection of the execution of agreements and limitation of risks, which is manifested in the security and reliability of supplies and increasing the energy security of the state. Identifying the stages of the evolution of natural gas exchange trading, the author distinguished gas trading on mixed commodity exchanges, gas trading on universal and specialized energy exchanges, which began to emerge slowly in the 1990s, and gas market liberalization, accompanied by a boom in the creation of gas exchanges and gas hubs. The recession of 2008-2009, the shale gas revolution, the process of decarbonization of the economy and the full-scale invasion of Ukraine by Russia have been the main catalysts for the modern transformation of the natural gas market in recent decades. The author concludes that the latter will significantly affect the natural gas market in the coming years, which will lead to a revision of European policy in this area and the struggle for energy security. This paper is an original scientific study of the evolution of natural gas exchange trading and makes a certain contribution to the study of the peculiarities of the gas market functioning.
How to Cite
##plugins.themes.bootstrap3.article.details##
natural gas, gas exchange, gas hubs, gas market evolution, Europe
Correljé, A. (2016). The European Natural Gas Market. Current Sustainable/Renewable Energy Reports, 3(1–2), 28–34. DOI: https://doi.org/10.1007/S40518-016-0048-Y
Council of European Energy Regulators. (2011). CEER final advice on the regulatory oversight of energy exchanges. E-source: https://www.ceer.eu/documents/104400/-/-/28aa309a-6b40-c401-372a-789c5694f6da
Dickx, L., Miriello, C., & Polo, M. (2014). Balancing Systems and Flexibility Tools in European Gas Markets. E-source: https://green.unibocconi.eu/sites/default/files/media/attach/Report_IEFE_14.pdf
Dubovskyi, О. (2018). Birzhova torhivlia pryrodnim hazom [Exchange trading of natural gas]. Ukrainian International Conference Petroleum X. E-source: https://www.ueex.com.ua/files/lastovets-ukrenergyexchange.pdf (in Ukrainian)
Dubovskyi, О. (2020). Hazovyi khab v Ukraini. Shcho tse i yak pratsiuvatyme? [Gas hub in Ukraine. What is it and how will it work?] NV. Biznes. E-source: https://biz.nv.ua/ukr/experts/ukrajinskiy-gazoviy-hab-koli-z-yavitsya-i-yak-bude-pracyuvati-infografika-novini-ukrajini-50120508.html (in Ukrainian)
Ghilès, F. (2022). War in Ukraine and the gas crisis force a rethink of EU foreign policy. CIDOB Notes Internacionals, 268, 1–5. DOI: https://doi.org/10.24241/NOTESINT.2022/268/EN
Haizmann, J, Malakhovskyi, M., & Zahnitko, O. (2018). Zvit pro khid vykonannia robit po Pershii stadii proektu z nadannia tekhnichnoi dopomohy Natsionalnii komisii z tsinnykh paperiv ta fondovoho rynku u harmonizatsii zakonodavstva Ukrainy, shcho peredbachaie stvorennia suchasnoi orhanizovanoi torhivli finansovymy instrumentamy [Report on the progress of work on the First Stage of the project on providing technical assistance to the National Commission for Securities and the Stock Market in harmonizing the legislation of Ukraine, which provides for the creation of modern organized trading in financial instruments]. E-source: https://www.nssmc.gov.ua/wp-content/uploads/2018/04/190522-Report-Activity-1_final_UA_OZA.docx (in Ukrainian)
Heather, P. (2015). The evolution of European traded gas hubs. OIES paper: NG104. DOI: https://doi.org/10.26889/9781784670467
Heather, P. (2021). European Traded Gas Hubs: German hubs about to merge. OIES paper: NG170. E-source: https://www.oxfordenergy.org/publications/european-traded-gas-hubs-german-hubs-about-to-merge/
Hulshof, D., van der Maat, J. P., & Mulder, M. (2016). Market fundamentals, competition and natural-gas prices. Energy Policy, 94, 480–491. DOI: https://doi.org/10.1016/J.ENPOL.2015.12.016
International Gas Union. (2021). Wholesale Gas Price Survey. 2021 Edition. E-source: https://www.igu.org/resources/global-wholesale-gas-price-survey-2021/
Kulikh, L. (2016). Ukrainskyi hazovyi khab – shans dlia Yevropy [The Ukrainian gas hub is a chance for Europe]. E-source: https://dixigroup.org/storage/files/2016-12-19/web_ukrainian_gas_hub_2016_ua_1.pdf (in Ukrainian)
List of power & energy exchanges worldwide (n.d.). E-source: https://www.next-kraftwerke.com/knowledge/power-exchanges-list
Lukianchuk, S. (2011). Velyka slantseva revoliutsiia. Spozhyvannia, vydobutok ta zapasy hazu u sviti [The Great Shale Revolution. Consumption, production and reserves of gas in the world]. Texty.org.ua. E-source: https://texty.org.ua/articles/30608/Velyka_slanceva_revolucija_Spozhyvanna_vydobutok_ta_zapasy-30608/ (in Ukrainian)
Markevych, K., & Omelchenko, V. (2016). Tsinoutvorennia na enerhetychnykh rynkakh: dosvid YeS ta Ukrainy [Pricing on energy markets: the experience of the EU and Ukraine]. E-source: https://razumkov.org.ua/uploads/article/2016_ENERGY-GAZ-pravki.pdf (in Ukrainian)
Mills, M. P. (2018). The real fuel of the future: natural gas. Manhattan Institute. E-source: https://www.manhattan-institute.org/html/real-fuel-future-natural-gas-11467.html
Natural gas. (n.d.). Energy Education. E-source: https://energyeducation.ca/encyclopedia/Natural_gas
Polikevych, N. I. (2015). Formuvannia birzhovykh enerhetychnykh rynkiv krain Skhidnoi Yevropy [Formation of energy exchanges markets in Eastern Europe]. Visnyk Odeskoho Natsionalnoho Universytetu. Seriia : Ekonomika, 20, 2/1, 26–30. E-source: http://www.irbis-nbuv.gov.ua/cgi-bin/irbis_nbuv/cgiirbis_64.exe?I21DBN=LINK&P21DBN=UJRN&Z21ID=&S21REF=10&S21CNR=20&S21STN=1&S21FMT=ASP_meta&C21COM=S&2_S21P03=FILA=&2_S21STR=Vonu_econ_2015_20_2%281%29__7 (in Ukrainian)
Pozsgai, P. (2019). Fundamentals of the gas market. Energy Community. E-source: https://www.energy-community.org/dam/jcr:962ed137-070b-4740-9df3-f80fdea731bd/ECRBREG102018_ECS.pdf
Rasmussen, E., Grimaldi, G., & Weinzettel, G. (2020). Ukrainian Gas Exchange: A pipedream or imminent reality? Energy Community Webinar series. E-source: https://www.energy-community.org/events/2020/05/WEBINAR_GAS_UE.html
Reuters Staff. (2017). What is a gas trading hub, and how are they established? Reuters. E-source: https://www.reuters.com/article/us-china-gas-exchange-q-a-idUSKBN1EN0I1
Rystad Energy, International Gas Union, & Snam. (2022). Global Gas Report 2022. E-source: https://www.igu.org/resources/global-gas-report-2022/
Site of “EEX”. E-source: https://www.powernext.com/
Site of “Europex – Association of European Energy Exchanges”. E-source: https://www.europex.org/
Site of “GAZ-SYSTEM: Natural Gas, Pipelines”. E-source: https://www.gaz-system.pl/en
Site of “SEGH”. E-source: https://www.cegh.at/
Sung, J. (2017). The impact of US LNG exports and the prospects for price-competitiveness in the East Asian market. Journal of World Energy Law and Business, 10(4), 316–328. DOI: https://doi.org/10.1093/jwelb/jwx011
Voytiv, M. (2016). Reforma hazovoho rynku. Chyim dosvidom varto skorystatysia Ukraini [Ukrainian Gas Market: Ukraine Needs a National Gas Exchange]. VoxUkraine. E-source: https://voxukraine.org/reforma-gazovogo-rynky-ua/ [(in Ukrainian)
Yergin, D. (2014). The Global Impact of US Shale. Project Syndicate. E-source: https://www.project-syndicate.org/magazine/daniel-yergin-traces-the-effects-of-america-s-shale-energy-revolution-on-the-balance-of-global-economic-and-political-power
Yukhymets, R. (2021). Rynky pryrodnoho hazu Ukrainy ta YeS: liberalizatsiia ta intehratsiia [Natural gas markets of Ukraine and the EU: liberalization and integration]. R. Z. Podolets (Ed.). Kyiv: DU “In-t ekon. ta prohnozuv. NAN Ukrainy”. (in Ukrainian)