Think about OPEC and all the good times the group has brought us oil consumers. Now Russia and another dozen or so members are in the nascent stages of forming a global natural gas price-setting organization that will be an additional benefit for energy-exporting countries and natural gas related exchange traded funds (ETFs).
Officials from member countires, Algeria, Bolivia, Brunei, Venezuela, Egypt, Indonesia, Iran, Qatar, Libya, Malaysia, Nigeria, the United Arab Emirates, Russia, Trinidad and Tobago and, as observers, Equatorial Guinea and Norway, claim they are coordinating investment plans to discourage countries from flooding the natural gas market, reports Andrew E. Kramer for The New York Times.
Long-term goals for the Forum of Gas Exporting Countires can potentially create an OPEC-like group for another basic global commodity. Ministers in this new group openly defy doctrines of their primary customers, industrialized countries, stating the rights of commodity exporting nations to come together and coordinate plans to improve their terms of trade.
Natural gas prices are said to be inevitably linked to the price of oil in the future. But the difference is that natural gas may be underpriced given the fact that its lower release of greenhouse gases is not priced into the fuel.