A natural-gas price war will break out when the global energy market is in a state of equilibrium, with prices falling, according to some analysts.
According to the latest market data, a single-day natural gas market is already showing signs of life.
According to Bloomberg, the price of a gallon of natural gas in the U.S. hit $3.40 on Thursday, which was just 0.4% above the $3-per-gallon peak of $3 a few days ago.
While the market is still volatile, it appears that the current supply-demand imbalance in the market may be breaking down, according the report.
“It’s likely that we will be seeing a period of price stability,” said Chris Dixon, head of energy research at JPMorgan Chase & Co. “It’s certainly a risk for natural gas producers.”
For years, prices have been on a downward trajectory, as the U-shaped supply curve has become increasingly tight.
But as the economy has expanded, demand for natural-Gas has increased, pushing prices down further.
In 2017, natural-Production from North Dakota surpassed that of South Dakota and Montana to become the top producer in the country.
Natural gas production is expected to grow by around 15% to 20% over the next two years, according data from IHS Markit.
In the meantime, prices could stay low for awhile.
A new report from Bloomberg indicates that prices are expected to remain low in the second half of this year, although the market could see a correction after the winter months.
According a Bloomberg report, the first half of the year is already being dominated by a price war between the major U.A.E. producers, which will drive up costs in the region, particularly as the supply of oil and gas has dried up.
The war between Russia and the U, which is also responsible for the world’s second-largest natural-Resource reserve, is expected in 2019.
However, in 2020, a new era will begin as Russia and U.K. producers begin to see prices increase.
In 2020, Russia’s Brent crude oil will rise by 9% to $105.50 a barrel.
However in 2020 the Brent price will increase by 2% to about $102.80 a barrel, according Bloomberg.
Brent will soon become the second-most expensive oil in the world.