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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, 06 September 24
REBOUND IN OIL DEMAND COULD LIFT MARKET IN LATTER HALF OF 2024 - BIMCO
Supply/demand
Based on a strong second half demand, the supply/balance is forecast to strengthen in 2024 but weaken slightly in 2025 as n ...
Friday, 06 September 24
GLOBAL SEABORNE LNG TRADE HAS CONTINUED TO INCREASE LAST YEAR - BANCHERO COSTA
Global seaborne LNG trade has continued to increase last year, helped also by the events in Ukraine which forced Europe to diversify away from Russ ...
Wednesday, 28 August 24
SEABORNE COAL IMPORTS INTO INDIA INCREASED BY +9.9% Y-O-Y TO 146.6 MLN T - BANCHERO COSTA
Global coal trade has really picked up pace over the past year, and is now fully back to pre-Covid levels said Banchero Costa Research in its lates ...
Tuesday, 06 August 24
EXERCISE CAUTION WITH AMMONIA SWITCH - BALTIC EXCHANGE
A new study from the Massachusetts Institute of Technology (MIT) has thrown a spanner into the plan to transition ships from diesel fuel to ammonia ...
Friday, 02 August 24
ENERGY MARKET DEVELOPMENTS: COAL AND NATURAL GAS PRICES REACH RECORD HIGHS - WORLD BANK
The recent surge in natural gas and coal prices has been so swift that the main benchmarks were roughly three times higher in 2022Q2 compared to a ...
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- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Meralco Power Generation, Philippines
- Sojitz Corporation - Japan
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- SMC Global Power, Philippines
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- Leighton Contractors Pty Ltd - Australia
- The University of Queensland
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- Wood Mackenzie - Singapore
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- Therma Luzon, Inc, Philippines
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- India Bulls Power Limited - India
- Banpu Public Company Limited - Thailand
- Merrill Lynch Commodities Europe
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- White Energy Company Limited
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- Globalindo Alam Lestari - Indonesia
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- Indika Energy - Indonesia
- Toyota Tsusho Corporation, Japan
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- Asia Pacific Energy Resources Ventures Inc, Philippines
- CIMB Investment Bank - Malaysia
- Gujarat Electricity Regulatory Commission - India
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- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Semirara Mining Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Krishnapatnam Port Company Ltd. - India
- London Commodity Brokers - England
- Thai Mozambique Logistica
- MS Steel International - UAE
- Posco Energy - South Korea
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Commonwealth Bank - Australia
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- Energy Development Corp, Philippines
- Aditya Birla Group - India
- Rio Tinto Coal - Australia
- Petron Corporation, Philippines
- Tamil Nadu electricity Board
- LBH Netherlands Bv - Netherlands
- Kideco Jaya Agung - Indonesia
- SN Aboitiz Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Romanian Commodities Exchange
- Bhushan Steel Limited - India
- Planning Commission, India
- Petrochimia International Co. Ltd.- Taiwan
- Iligan Light & Power Inc, Philippines
- Goldman Sachs - Singapore
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- Global Coal Blending Company Limited - Australia
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- Economic Council, Georgia
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Siam City Cement PLC, Thailand
- Kumho Petrochemical, South Korea
- IHS Mccloskey Coal Group - USA
- European Bulk Services B.V. - Netherlands
- Grasim Industreis Ltd - India
- Global Green Power PLC Corporation, Philippines
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- Mercator Lines Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bulk Trading Sa - Switzerland
- Kapuas Tunggal Persada - Indonesia
- Minerals Council of Australia
- Sindya Power Generating Company Private Ltd
- Eastern Energy - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- GMR Energy Limited - India
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Price Waterhouse Coopers - Russia
- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Wilmar Investment Holdings
- ASAPP Information Group - India
- Central Java Power - Indonesia
- Savvy Resources Ltd - HongKong
- Miang Besar Coal Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Ministry of Transport, Egypt
- Holcim Trading Pte Ltd - Singapore
- Bukit Makmur.PT - Indonesia
- New Zealand Coal & Carbon
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- Salva Resources Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- The State Trading Corporation of India Ltd
- Singapore Mercantile Exchange
- PNOC Exploration Corporation - Philippines
- Heidelberg Cement - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Electricity Generating Authority of Thailand
- PTC India Limited - India
- IEA Clean Coal Centre - UK
- Electricity Authority, New Zealand
- Marubeni Corporation - India
- Renaissance Capital - South Africa
- Global Business Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
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- The Treasury - Australian Government
- Orica Mining Services - Indonesia
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- GVK Power & Infra Limited - India
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- Kaltim Prima Coal - Indonesia
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- Madhucon Powers Ltd - India
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Latin American Coal - Colombia
- Simpson Spence & Young - Indonesia
- Chamber of Mines of South Africa
- SMG Consultants - Indonesia
- Aboitiz Power Corporation - Philippines
- McConnell Dowell - Australia
- Parliament of New Zealand
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