What is the Gulf Coast Marker (GCM)?
On 16th June 2016, S&P Global Platts launched the Platts Gulf Coast Marker (GCM), a price assessment reflecting the daily export value of LNG traded free on board (FOB) from the US Gulf Coast.
The Platts GCM reflects bids, offers and transactions on an FOB US basis, normalized to the U.S. Gulf Coast, and expressed USD per British thermal units (MMBtu). The natural gas infrastructure that intersects the United States, Mexico and Canada is the world's largest and most integrated natural gas market. By 2020, the United States is expected to be the world's third largest producer of LNG, behind Australia and Qatar.
Unlike Australia, Qatar, and other large LNG exporting nations, US LNG does not have destination restrictions. There is also much more flexibility around offtake volumes. These factors make US LNG attractive for buyers and sellers looking to trade on a short term basis.
As the market continues to transact more often on a short term/spot basis (some experts predict that short term trade could account for as much as 43% of trade globally by 2020), US LNG prices will gradually play a growing role in influencing the price of LNG around the world.