The graph of USA, Japanese and European gas prices describes two different types of markets, those exposed to international prices (Japan and Europe are importers), and a price that is basically established for a domestic economy (USA). Similar to what happened in Western Australia and is forecast for eastern Australia, when the local gas production is faced with prospect of selling into international gas price markets, the domestic price is forced upward, as domestic buyers compete with international prices offered for exported product.
Prices that are forecast for the US gas, that is planned to be exported as LNG, are forecast to increase to about USD 6-7/ mmbtu by 2020. This is a significant price increase from current levels (~USD 4/mmbtu) for an economy the size of the USA. If the supply to the Japanese and European customers is strong enough, as US supply becomes seaborne, the CIF Japan and European prices might reduce a little reflecting new supply, and meet the increasing export prices part way.
Refer to Matau Advisory’s 20140606 Commodity Review for more detail. (available by subscription https://www.dropbox.com/s/ztrq3uoh1d6l4eb/Commodity-Review-Subscription-Form-20140302.docx)