Market integration for natural gas in Europe
Journal article, Peer reviewed
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Original versionAsche, F. ; Osmundsen, P. & Tveterås, R. (2001) Market integration for natural gas in Europe. International Journal of Global Energy Issues, 16(4), pp. 300-312 10.1504/IJGEI.2001.000925
In this paper we examine the degree of market integration in French gas imports. Are there substantial price differences between gas from different export countries, and do prices move together? Furthermore, we analyze to what extent the French, German and Belgian markets are integrated. The long-term takeor- pay contracts are described and analyzed. Time series of Norwegian, Dutch and Russian gas export prices are examined for the period 1990-1997. Cointegration tests show that that the different border prices for gas to France move proportionally over time, indicating that the Law of One Price holds. Although one could expect different producer countries to have different supply obligations, we do not find any significant differences in mean prices. When the study is extended to an inter-country analysis including Germany and Belgium, we find that national markets are highly integrated.
The article was originally published as follows: Asche, F. ; Osmundsen, P. & Tveterås, R. (2001) Market integration for natural gas in Europe. Int. J. of Global Energy Issues, 2001 Vol.16, No.4, pp.300-312. Posted here with permission from Inderscience.