Steno Research: Are we starting to see the early signs of a 2022 dynamic in LNG?

The below chart describes the scenario we saw late summer last year here in Europe when policymakers all the sudden scrambled to secure natural gas. We find reasons for and against the below scenario. Let’s dive into it!    

For the cycle to truly have the chance of playing out we need natural gas demand to increase and the USD to strengthen as a product of the increase in demand. If the USD appreciates then it might put a spanner in the works since the USD strength might wreck demand.       

Chart 1: The Summer 2022 energy  mayhem visualized