The pricing is linear in the sense that when oil goes to $145 a barrel it creates an umbrella and if you think of NG as an alternative fuel then it now has a much higher upper range into which it can be priced. Whether NG competition allows this rise or not is another thing but typically when there are oil pricing spikes the NG producers will manage production so that they can price under the oil umbrella. Remember, oil pricing was just as volatile over the past three years. Look at its range. Anyway, maybe linear was not the right word but you get the point I was on. Both fuels rise and fall based upon country economics and global demand.
On the question of selling NG to Japan the answer is yes, we will sell into the market with the best margins if those are better than domestic sales, though NG into Japan may be a bad example. For example, some North Slope oil is sold into Asia. It is cheaper to put it on a huge tanker, one that can't navigate the Panama Canal, and send it off to Asian refineries than to navigate around South America and bring it into the Texas refineries. To offset this oil export we will import heavy crude into Texas from Venezula. On balance, the domestic oil company makes more money doing this.
The main economics of LNG terminals in Long Island Sound is that there is very poor NG infrastructure in the Northeast. There just isn't the piping around here whereas when I lived in western NY everyone burned NG and there were literally few oil burners in homes.
So there is a lot of work to switch to NG from oil for heating and transportation but this transition will either start now or will be forced on us. That is what Cap & Trade is all about, make energy so expensive there are no other options but to go green but green can't produce the energy that is needed in the forms we need it.