Natural gas shortage in 2023 per MS - Jan 25

[dan_s]

Morgan Stanley (MS) Research Analysts Devin McDermott, Igor Kuzmin and the global energy team highlight that elevated spot
prices should moderate, but the team reiterates its call for a multiyear LNG recovery with a su pply shortfall by
2023. The team notes that demand is growing ~2x faster than supply, supporting a multiyear recovery. The
market is set to return to balance by 2022 before shifting into a supply shortfall by 2023, driving a ~2x increase
in LNG prices 2020 -23 and implying >20% upside to out -year futures prices, in the team’s view. The MS LNG
model, which integrates regional data and expertise from the MS global energy team, informs two commodity
trade ideas, two equities with a large mismatch between MS and consensus views, and 7 key global stocks to
play the next gas cycle. Examining the key stock calls, the team highlights: 1) 50 -90% upside to 2021-23e