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Wednesday, 31 January 24
GAS EXPORTS COST U.S. CONSUMERS MORE THAN $100 BILLION OVER 16-MONTH PERIOD - IEEFA
 Limited Demand Growth Could Dampen the Dry Bulk Market in the Coming Months BIMCOStarting in late 2021—before its invasion of Ukraine—Russia began to manipulate Europe’s energy markets by trimming gas shipments and emptying gas storage facilities on the continent. To fill the supply gaps, Europe ramped up its purchases of liquefied natural gas (LNG). A global bidding war for LNG ensued. Wealthy European nations vied with buyers in Japan, South Korea, Taiwan, China, and developing nations for a limited LNG supply, and prices soared to previously unimaginable highs.
The gas price contagion quickly spread to American shores. U.S. LNG exporters bought all the gas they could handle, hoping to reap big profits by selling U.S. gas to overheated global markets. Surging exports, in turn, shortchanged U.S. supplies; domestic gas stockpiles fell to multi-year lows, and wholesale gas prices rocketed to their highest levels in more than a decade.
Those price spikes were largely passed on to U.S. consumers. According to the Energy Information Administration, total U.S. spending on natural gas soared to $269 billion in 2022, up from $150 billion in 2019, the last “normal” year before COVID-19 and Russia roiled U.S. gas markets.
It’s impossible to know exactly how much U.S. consumers would have spent if Russia hadn’t upended global gas markets. But there’s absolutely no doubt that surging LNG exports helped trigger the surge in U.S. gas prices.
Between 2020 and 2022, total gas production in the U.S. increased by 7 billion cubic feet per day (Bcf/d), while domestic consumption went up by just 4.6 Bcf/d. With domestic production rising faster than consumption, you might expect prices to stay muted. But exports changed the equation. LNG exports went up by 4 Bcf/d over the same period, and pipeline exports rose by 0.4 Bcf/d. All told, combining growth in bothdomestic consumption and exports, demand for U.S. gas went up about 2 Bcf/d faster than production.
With demand outpacing supply, prices soared. But if exports had grown more slowly, the U.S. gas market would have been in better balance, and prices would have been closer to—or perhaps less than—their long-term average.
In the years before Russia upended the U.S. gas market, the average monthly wholesale price for gas hovered at just over $3 per million metric British thermal units (MMBtu). FromSeptember 2021 through December 2022—the years of Russian-induced gas market chaos—prices nearly doubled their long-term average.
Higher wholesale prices fueled inflation for all U.S. consumers, including families heating their homes, businesses, and industries. It became more expensive to keep the lights on, as well. Gas-dependent electric utilities saw their costs rise, and many passed the increased costs to their customers. Some people saw the price increases directly in their utility bills, but much was hidden in the overall increase in prices for goods and services.
If domestic gas prices had remained at their long-term average, U.S. consumers would have spent roughly $111 billion less on wholesale natural gas purchases from September 2021 through December 2022. Or, said differently, the Russia-induced price spikes cost U.S. households and gas buyers $111 billion, but led to a $111 billion windfall for the gas industry.
The transfer of wealth from gas consumers to gas producers varied by sector. All told, homeowners and renters paid gas companies an additional $14 billion during the market havoc. Office buildings and other commercial users spent an additional $11 billion. U.S. industrial gas users transferred about $33 billion to oil and gas companies. And electric utilities paid a whopping $50 billion more for their fuel.
It’s high time for the consumer effects of LNG exports to receive the attention they deserve. After all, what’s happened before could happen again. When the circumstances are right—a cold snap in Asia, a pipeline explosion in Europe, unrest in the Middle East—overseas buyers will once again ramp up their demand for LNG and compete directly with U.S. consumers for a limited supply of U.S. gas. The more export capacity we have, the more likely it is that a gas supply disruption anywhere in the world will trigger a price spike here at home. It’s a twist on the old adage: When the world sneezes, the U.S. will catch cold.
Source: IEEFA
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Friday, 23 February 24
STRONG OUTLOOK FOR THE TANKER MARKET IN 2024 AND BEYOND - DNV
Several factors have aligned over the past two years to create a robust and profitable market for tanker owners, which is expected to drive newbuil ...
Friday, 23 February 24
AUSTRALIAN COAL FLOWS TO ASIA HOVER ABOVE LAST YEAR’S VOLUME TONNES - SIGNAL GROUP
In the final days of February, the dry bulk freight market appeared to maintain a relatively stable momentum, particularly evident in the large ves ...
Friday, 23 February 24
RUSSIAN COAL SHIPMENTS FALL 14% AS SANCTIONS BITE - BIMCO
During the first seven weeks of 2024, Russian coal shipments have fallen 14% y/y. Volumes have gradually declined since October 2023 when logistica ...
Thursday, 22 February 24
BIMCO PUBLISHES SHIP FINANCING FORMS TO ENSURE UNINTERRUPTED USE OF SHIPS
BIMCO has published two standard Quiet Enjoyment Letters (QELs), the first standard form QELs available to the industry, to offer a tool that can e ...
Monday, 19 February 24
METALS INVESTMENT: THE DARKEST HOUR IS JUST BEFORE THE DAWN - WOOD MACKENZIE
Things often seem at their worst just before they get better. In terms of meeting our net zero 2050 scenario, we’ve reached a watershed momen ...
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- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Bhoruka Overseas - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Borneo Indobara - Indonesia
- Australian Coal Association
- Karaikal Port Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Sarangani Energy Corporation, Philippines
- Mjunction Services Limited - India
- Iligan Light & Power Inc, Philippines
- Central Electricity Authority - India
- Indian Energy Exchange, India
- Orica Mining Services - Indonesia
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Essar Steel Hazira Ltd - India
- Tamil Nadu electricity Board
- San Jose City I Power Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Economic Council, Georgia
- Central Java Power - Indonesia
- Ambuja Cements Ltd - India
- Romanian Commodities Exchange
- Banpu Public Company Limited - Thailand
- PowerSource Philippines DevCo
- Dalmia Cement Bharat India
- Singapore Mercantile Exchange
- Wilmar Investment Holdings
- VISA Power Limited - India
- Videocon Industries ltd - India
- Kumho Petrochemical, South Korea
- Barasentosa Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Mercator Lines Limited - India
- Krishnapatnam Port Company Ltd. - India
- Energy Development Corp, Philippines
- Vedanta Resources Plc - India
- SMC Global Power, Philippines
- Intertek Mineral Services - Indonesia
- Straits Asia Resources Limited - Singapore
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Vizag Seaport Private Limited - India
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Uttam Galva Steels Limited - India
- Anglo American - United Kingdom
- McConnell Dowell - Australia
- Africa Commodities Group - South Africa
- Holcim Trading Pte Ltd - Singapore
- Australian Commodity Traders Exchange
- Latin American Coal - Colombia
- Kobexindo Tractors - Indoneisa
- Mercuria Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Coastal Gujarat Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- White Energy Company Limited
- South Luzon Thermal Energy Corporation
- Bharathi Cement Corporation - India
- The State Trading Corporation of India Ltd
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- International Coal Ventures Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Coalindo Energy - Indonesia
- Coal and Oil Company - UAE
- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Interocean Group of Companies - India
- Carbofer General Trading SA - India
- Ind-Barath Power Infra Limited - India
- Chamber of Mines of South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Madhucon Powers Ltd - India
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- CIMB Investment Bank - Malaysia
- ASAPP Information Group - India
- Bhatia International Limited - India
- Marubeni Corporation - India
- Sree Jayajothi Cements Limited - India
- Ministry of Finance - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- CNBM International Corporation - China
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Bayan Resources Tbk. - Indonesia
- Power Finance Corporation Ltd., India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Goldman Sachs - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Globalindo Alam Lestari - Indonesia
- IEA Clean Coal Centre - UK
- PNOC Exploration Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Deloitte Consulting - India
- Mintek Dendrill Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- Grasim Industreis Ltd - India
- Savvy Resources Ltd - HongKong
- Altura Mining Limited, Indonesia
- Medco Energi Mining Internasional
- Sojitz Corporation - Japan
- Meenaskhi Energy Private Limited - India
- Global Business Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Orica Australia Pty. Ltd.
- SMG Consultants - Indonesia
- GVK Power & Infra Limited - India
- TeaM Sual Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Tata Chemicals Ltd - India
- Independent Power Producers Association of India
- The University of Queensland
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Indonesian Coal Mining Association
- Pipit Mutiara Jaya. PT, Indonesia
- Commonwealth Bank - Australia
- Salva Resources Pvt Ltd - India
- Minerals Council of Australia
- Kepco SPC Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Jindal Steel & Power Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Indika Energy - Indonesia
- Trasteel International SA, Italy
- Thai Mozambique Logistica
- Directorate General of MIneral and Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Cement Manufacturers Association - India
- Sical Logistics Limited - India
- Riau Bara Harum - Indonesia
- Planning Commission, India
- Energy Link Ltd, New Zealand
- Simpson Spence & Young - Indonesia
- Malabar Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- European Bulk Services B.V. - Netherlands
- Timah Investasi Mineral - Indoneisa
- Makarim & Taira - Indonesia
- Bulk Trading Sa - Switzerland
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Aditya Birla Group - India
- India Bulls Power Limited - India
- Bukit Baiduri Energy - Indonesia
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Heidelberg Cement - Germany
- Ministry of Mines - Canada
- Kapuas Tunggal Persada - Indonesia
- Global Green Power PLC Corporation, Philippines
- MS Steel International - UAE
- Attock Cement Pakistan Limited
- Bhushan Steel Limited - India
- Renaissance Capital - South Africa
- PTC India Limited - India
- Electricity Generating Authority of Thailand
- Ceylon Electricity Board - Sri Lanka
- Gujarat Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Semirara Mining Corp, Philippines
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Thiess Contractors Indonesia
- Gujarat Sidhee Cement - India
- Semirara Mining and Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Standard Chartered Bank - UAE
- Samtan Co., Ltd - South Korea
- Wood Mackenzie - Singapore
- Baramulti Group, Indonesia
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- Posco Energy - South Korea
- Merrill Lynch Commodities Europe
- Global Coal Blending Company Limited - Australia
- Agrawal Coal Company - India
- Edison Trading Spa - Italy
- Bangladesh Power Developement Board
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- Parry Sugars Refinery, India
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