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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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- Central Electricity Authority - India
- Indogreen Group - Indonesia
- Global Green Power PLC Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Africa Commodities Group - South Africa
- Meenaskhi Energy Private Limited - India
- The State Trading Corporation of India Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Riau Bara Harum - Indonesia
- Toyota Tsusho Corporation, Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Standard Chartered Bank - UAE
- Karaikal Port Pvt Ltd - India
- Interocean Group of Companies - India
- Bukit Baiduri Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Edison Trading Spa - Italy
- Parliament of New Zealand
- Directorate Of Revenue Intelligence - India
- Minerals Council of Australia
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- Gujarat Sidhee Cement - India
- Krishnapatnam Port Company Ltd. - India
- Energy Development Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Posco Energy - South Korea
- Simpson Spence & Young - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- Pendopo Energi Batubara - Indonesia
- GVK Power & Infra Limited - India
- Electricity Generating Authority of Thailand
- Grasim Industreis Ltd - India
- Sojitz Corporation - Japan
- Directorate General of MIneral and Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Bhushan Steel Limited - India
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- PTC India Limited - India
- SMC Global Power, Philippines
- Jaiprakash Power Ventures ltd
- MS Steel International - UAE
- Kaltim Prima Coal - Indonesia
- Eastern Energy - Thailand
- Coal and Oil Company - UAE
- Ministry of Finance - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Trasteel International SA, Italy
- Kepco SPC Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Commonwealth Bank - Australia
- Tata Chemicals Ltd - India
- Chamber of Mines of South Africa
- Mercuria Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Georgia Ports Authority, United States
- White Energy Company Limited
- Videocon Industries ltd - India
- Ministry of Transport, Egypt
- Metalloyd Limited - United Kingdom
- Eastern Coal Council - USA
- Makarim & Taira - Indonesia
- Meralco Power Generation, Philippines
- Coastal Gujarat Power Limited - India
- Romanian Commodities Exchange
- Kapuas Tunggal Persada - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- ICICI Bank Limited - India
- Borneo Indobara - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- AsiaOL BioFuels Corp., Philippines
- Maharashtra Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- Sarangani Energy Corporation, Philippines
- Larsen & Toubro Limited - India
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- Timah Investasi Mineral - Indoneisa
- Bukit Makmur.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Aditya Birla Group - India
- Baramulti Group, Indonesia
- Kartika Selabumi Mining - Indonesia
- ASAPP Information Group - India
- Orica Mining Services - Indonesia
- The University of Queensland
- Aboitiz Power Corporation - Philippines
- IEA Clean Coal Centre - UK
- Formosa Plastics Group - Taiwan
- Barasentosa Lestari - Indonesia
- Indonesian Coal Mining Association
- Economic Council, Georgia
- Iligan Light & Power Inc, Philippines
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Madhucon Powers Ltd - India
- Ind-Barath Power Infra Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Goldman Sachs - Singapore
- San Jose City I Power Corp, Philippines
- Maheswari Brothers Coal Limited - India
- GMR Energy Limited - India
- Indo Tambangraya Megah - Indonesia
- Vizag Seaport Private Limited - India
- Billiton Holdings Pty Ltd - Australia
- Singapore Mercantile Exchange
- Planning Commission, India
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Thai Mozambique Logistica
- Australian Coal Association
- Bahari Cakrawala Sebuku - Indonesia
- India Bulls Power Limited - India
- Bhoruka Overseas - Indonesia
- Central Java Power - Indonesia
- Medco Energi Mining Internasional
- Carbofer General Trading SA - India
- Heidelberg Cement - Germany
- Dalmia Cement Bharat India
- Bhatia International Limited - India
- Rio Tinto Coal - Australia
- CIMB Investment Bank - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- The Treasury - Australian Government
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Marubeni Corporation - India
- VISA Power Limited - India
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Rashtriya Ispat Nigam Limited - India
- Chettinad Cement Corporation Ltd - India
- PNOC Exploration Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kideco Jaya Agung - Indonesia
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Siam City Cement - Thailand
- Independent Power Producers Association of India
- Bangladesh Power Developement Board
- Petron Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Leighton Contractors Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- Malabar Cements Ltd - India
- Parry Sugars Refinery, India
- Deloitte Consulting - India
- Coalindo Energy - Indonesia
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- London Commodity Brokers - England
- Mercator Lines Limited - India
- Star Paper Mills Limited - India
- Cement Manufacturers Association - India
- Ministry of Mines - Canada
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- Banpu Public Company Limited - Thailand
- Orica Australia Pty. Ltd.
- PetroVietnam Power Coal Import and Supply Company
- Sical Logistics Limited - India
- Agrawal Coal Company - India
- Salva Resources Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Vedanta Resources Plc - India
- Mintek Dendrill Indonesia
- Sindya Power Generating Company Private Ltd
- Kumho Petrochemical, South Korea
- Asmin Koalindo Tuhup - Indonesia
- Samtan Co., Ltd - South Korea
- Sinarmas Energy and Mining - Indonesia
- Therma Luzon, Inc, Philippines
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Indika Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Xindia Steels Limited - India
- PowerSource Philippines DevCo
- Price Waterhouse Coopers - Russia
- Indian Energy Exchange, India
- Indian Oil Corporation Limited
- CNBM International Corporation - China
- Straits Asia Resources Limited - Singapore
- Wood Mackenzie - Singapore
- Globalindo Alam Lestari - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Lanco Infratech Ltd - India
- LBH Netherlands Bv - Netherlands
- International Coal Ventures Pvt Ltd - India
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