Gazprom (GAZP.RS) is unlikely to seek shorter-term gas supply contracts in the future, Deutsche Bank says after Algeria pledges to do just that.
"For Gazprom, which is only at the beginning of its LNG path, pipeline gas will continue to be at the center of its business model," noting long-term agreements are essential to offering its European customers predictability.
Adds creating an OPEC-type gas cartel could be difficult as long-term contracts lock supplies, usually by pipeline, to a specified buyer and it's difficult-to-impossible to divert gas to another customer, even if a higher price is offered. Rates a buy, $20.80 target price. Shares +0.2% at $13.10. (AJL)