The two main drivers of production and prices of the North American oil/gas markets are politics and environment. Shale oil and gas production including inventories too play a key role in pricing. However, even though the oil and the gas markets behave differently in US both the commodities get equally impacted by local conditions and events happening around the world – however, gas less impacted than oil. For example, the coronavirus pandemic in and outside USA affected both the gas and oil price severely. Local situations like drop in rig numbers for shale oil/gas production can significantly affect production, especially associated gas whenever rig numbers drop because of low oil price. In fact, the shale gas production has been able to keep the gas price below $3/MMBtu for a long time. Let us hope that the new US regime does not come down heavily on the shale industry because of environment reasons. If it happens, then both Brent and Nymex are likely to be impacted.
Henry Hub and Nymex are estimated to cross the the average HH price of about $2.49 per MMBtu in the year 2021. The higher the HH, LNG exports out of USA will become costly, especially for India with the long distance shipping costs.
Coming back to the difference in behavior of the delta in prices of the two commodities, We would say that this year has been different because of the pandemic situation around the world. Gas markets around the world have recovered faster than the oil markets. Even before the pandemic set in, the world economy had been slowing down which impacted the oil markets much more, therefore, the delta was higher and consistent over the entire year. Whereas the dip in gas markets was more severe during lockdowns. Obviously the destruction of demand for oil and gas impacted the price.