The world's biggest natural gas-producing countries agreed on Monday to try to index natural gas prices to oil, but steered away from any plan to establish output quotas as a way of tackling slumping prices. The decision by the Gas Exporting Countries Forum (GECF), comes as natural gas, which had traditionally been sold under long term contracts, has failed to realize the kind of price rebound registered over the past few months in oil markets. Producers say higher prices are key to sustaining the kind of investment necessary to continue exploration and production efforts. But gas prices have nearly halved over the past two years, prompting some of the GECF'a 11 members, like Algeria, to push for organization that could increase rates by agreeing on output quotas similar to those of Organization of the Petroleum Exporting Countries (OPEC). The final declaration issued by the GECF, whose members hold some 70 percent of the world's natural gas reserves, made no reference to quotas. The forum's statement said members “agree that ensuring adequate and reliable supplies of gas at prices reflecting parity with oil prices ... is a challenge.” The group, whose members range from Qatar to Russia, is an increasingly structured body that tries to model itself somewhat on the 12-member OPEC. It was the first time a ministers' forum produced a final declaration, but its decisions are not binding.
