European market integration for gas
Original version
Asche, F. ; Osmundsen, P. & Tveterås, R. (2002) European market integration for gas. Energy Economics , 24(3) pp. 249–265 10.1016/S0140-9883(02)00003-8Abstract
Long-term take-or-pay contracts regulating gas exports to the Continent are described
and analyzed. We thereafter examine whether the German gas market is integrated. Time
series of Norwegian, Dutch and Russian gas export prices to Germany in 1990 1998 are
examined. Cointegration tests show that that the different border prices for gas to Germany
move proportionally over time, indicating an integrated gas market. We find differences in
mean prices, with Russian gas being sold at prices systematically lower than Dutch and
Norwegian gas. Among the explanatory factors for price discrepancies are differences in
volume flexibility (swing) and perceived political risk.
Description
This is a copy of an article originally published by Elsevier in Energy Economics; see http://www.sciencedirect.com/science/journal/03014215. © 2002 Elsevier Science B.V.