Tag: drought

Best in Energy – 25 April 2023

U.S. shale sector has matured (Bloomberg)

Iraq/Turkey oil flows still halted (Reuters)

Global diesel margins narrow (Reuters)

China’s hydrogen deployment (Xinhua)

U.S./China and the route to conflict (FT)

Global supply chains are changing (WSJ)

EUROPE’s front-month gas futures price has fallen below €40 per megawatt-hour, down from €189 at the start of winter 2022/23, to encourage more consumption from energy-intensive industries and power generators while redirecting LNG flows to customers in South and East Asia:

CHINA’s southwest received far less precipitation than average in the second half of 2022 and low rainfall has persisted into 2023, threatening hydroelectric power generation and industrial output:

Best in Energy – 24 April 2023

Semiconductor firms set for long downturn (FT)

China aluminium output hit by drought (Reuters)

South Korea’s interest in nuclear weapons (BBC)

Gold reserves benefit from rise in sanctions (FT)

Chile focus on direct lithium extraction (Reuters)

Wind farms look to deeper offshore sites (Reuters)

JAPAN‘s LNG stocks ended January at 2.34 million tonnes, the highest for the time of year for at least eight years. Stocks remained plentiful even though the first part of winter was colder-than-average in Tokyo:

Best in Energy – 17 October 2022

[MUST READ] U.S./China relations in Xi Jinping era ($WSJ)

[MUST READ] Nuclear war lessons from past crises ($WSJ)

[MUST READ] China prioritises energy security ($BBG)

Europe’s gas supply still at risk from cold winter weather

EU tries to reach internal consensus on capping gas prices

OPEC+ officials defend Saudi Arabia after U.S. criticism

NOPEC law would escalate U.S./Saudi tensions ($BBG)

California drought drains Lake Shasta ($WSJ)

China plans to boost coal and oil inventories

China to stop LNG resales to Europe ($BBG)

Retailers accelerate sales as inflation rises ($BBG)

Diesel shortage threatens global economy ($BBG)

EUROPE’s gas futures prices for November and December have continued to fall as regional storage facilities near maximum capacity. There is enough gas in stock to ensure supplies through the first half of the winter. But the risk to supplies in the second half and during next year’s refill season is keeping prices for 2023 high:

Best in Energy – 15 September 2022

[MUST READ] China focuses on self-reliance ($FT)

Remote work likely to persist after pandemic ($WSJ)

U.S. shale firms won’t boost oil and gas output ($FT)

U.S. SPR’s role in the oil market is changing ($BBG)

U.S. gas consumption forecast to hit record in 2022

Germany warns about energy risk from cold winter

China planner warns against yin-yang coal prices

China’s continued drought in Yangtze basin (trans.)

U.S. Northeast fears fuel shortages in event of rail strike

LVMH to turn off store lighting overnight to save power

Eiffel Tower to turn off lights earlier to save power ($WSJ)

U.K. GAS AND ELECTRICITY consumption has not shown a significant decline so far in response to higher prices. I spent a large part of yesterday trying to find a price response in the available official consumption statistics without success. The charts are below. But there are some important limitations:  

  • Electricity consumption data is only available through June and gas data is only available through March owing to publication delays.
  • Most of the rise in prices has occurred since April with another big increase scheduled to take effect from October.
  • Heating demand and bills are lower in the summer months reducing consumers’ sensitivity to prices.
  • Domestic and commercial consumption patterns have been distorted by the lockdowns in 2020/21 and then re-opening in 2022.
  • Electricity and gas consumption has been on a long-term downtrend as a result of improvements in insulation and efficiency.
  • Electricity and gas consumption shows significant annual variation depending on winter temperatures.

Once these factors are taken into account, there is no evidence of a significant reduction in gas and electricity use by households, offices and commercial premises so far. If reductions are going to occur, it will be later this year and into 2023:

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