3Liquefied natural gas is a valuable resource to households and business community in Australia. Therefore, as the incomes of Australians rise, the demand for gas increases considerably. The need to adopt cleaner energy has also increased the demand for this resource among the firms. Additionally, as more enterprises are being set up, the need for the liquefied natural gas has increased.2 The increase in the use of the gas in the local market has made the prices to increase. Graph 1: Increase in Demand for GasPriceQuantity The rise in the use of liquefied natural gas by Australian households and the firms is shown by the shift in demand curve from D0 to D1. This situation has increased the quantity of gas demanded and also a hike in the price. The amount of gas supplied by the producer is Qe while the quantity demanded is Q2. The gap between Q2 and Q1 depicts the shortage. The price has increased from P1 to P2.2Grafton, R. Quentin, And N. Ross Lambie. "Australia's Liquefied Natural Gas Sector: Past Developments, Current Challenges And Ways Forward." Australian Economic Review, 2014: 509-522.SP1PeD1Shortage of gasD0Q2QeQ1

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