Tag: export controls

Best in Energy – 20 March 2023

EU energy-intensive business ($FT) ¹

Russia oil trade and sanctions ($FT)

Iraq’s mismanaged reconstruction

Supercore prices and policymaking

Russia/China border trade ($WSJ)

Germany urges more gas conservation

India plan to extend fuel export controls

¹ The two most important observations in this article are about gas demand reductions by energy-intensive businesses:

“Lower prices are not only saving energy-intensive companies a fortune. They have also put the colour back in the elaborate creations of the Italian glass blowers at New Murano Gallery.  Each of the firm’s 11 1,000 degree furnaces produces glass with a different hue and, after the company had to turn half of them off last year, almost all are back on. ‘We have nearly the full palette,’ Francesco Scarpa, one of the gallery’s co-founders.”

“Fernández-Valladares described the mood of the tile making sector that dominates his small town in Castellón province as ‘generally quite pessimistic’. Sales have plunged. Since December, demand from clients — which are mostly wholesale buyers — has dropped 30 per cent. In January, the factory resorted to the radical option of turning off the kiln for an extended period, shutting it down for 22 days to save on gas. Fernández-Valladares said he could not rule out more shutdowns. ‘We normally work through the Easter holidays and I don’t know if we’re going to have to stop.’”

Multiply these examples across the entire European Union, and it helps explain much of the reduction in temperature-adjusted gas consumption during winter 2022/23.

BRENT’s six-month calendar spread has collapsed to a backwardation of just 47 cents per barrel down from $3 per barrel at the start of March as traders anticipate a much higher probability of a hard-landing or recession following enforced takeover of the crisis-stricken Credit Suisse by rival bank UBS:

Best in Energy – 8 March 2023

Russia/India switch trade settlement out of dollars

India’s heightened risk of evening power shortages

Nord Stream sabotage linked to Ukraine ($NYT)

Ukraine denies involvement in pipeline sabotage

U.S. shale chiefs recognise end of revolution ($FT)

Tesla shifts focus to cutting manufacturing costs

Nuclear generation deployment is shifting to Asia  

China’s military researchers study Ukraine conflict

Europe boosts diesel from Middle East and Asia

Tech sanctions to spur industrial espionage ($FT)

U.S./China struggle to stabilise relationship ($WSJ)

U.S. CENTRAL BANK chief Jerome Powell toughened his rhetoric on core inflation during congressional testimony, sending forecasts for interest rates surging higher on March 7. Rate traders expected interest rates to end 2023 at around 5.55% up from a forecast of 5.38% on March 6:

SINGAPORE distillate inventories remain at their lowest level for the time of year since 2008. Stocks are -4 million barrels (-36% or -1.91 standard deviations) below the prior ten-year seasonal average. The deficit has only narrowed slightly from six months ago when it was -4 million barrels (-34% or -2.21 standard deviations):

Best in Energy – 21 February 2023

India directs private coal-fired generators to run

EU heat pump sales surge on high energy prices

Russia/U.S./China trilateral relationship ($WSJ)

Russia/Netherlands infrastructure threat ($FT)

U.S/China intellectual property conflicts ($WSJ)

U.S./China technology export controls ($WSJ)

U.S./Taiwan step up military cooperation

China’s coal output and emissions ($BBG)

Ion’s ransomware attack ($FT)

EUROZONE manufacturers reported business activity fell in February for the eighth consecutive month. Preliminary estimates from partial survey data put the purchasing managers’ index at 48.5 (25th percentile for all months since 2006) in February compared with 48.8 (26th percentile) in January:

EU EMISSIONS allowance prices have hit a record €100 per tonne of CO2 equivalent for the compliance period ending in December 2023:

Best in Energy – 16 February 2023

China plans record solar deployment

Shell’s LNG market outlook for 2023

Sri Lanka hikes power prices by 66%

U.S. gas prices drop in warm January

U.S. energy transition subsidies ($FT)

Truck-makers explore hydrogen fuel cells

Norway examines restricting power exports

U.S. economic data and nonresponse ($BBG)

U.S. PETROLEUM INVENTORIES including the strategic reserve surged by +19 million barrels in the seven days ending on February 10. There was a huge accumulation in reported stocks of crude (+16 million barrels) with smaller increases in gasoline (+2 million) and jet fuel (+1 million) partly offset by a drawdown in distillate fuel oil (-1 million).

Total inventories were still -243 million barrels (-13% or -2.26 standard deviations) below the prior ten-year seasonal average. But stocks have been trending higher since late December and the deficit to the seasonal average is staring to narrow:

Best in Energy – 5 October 2022

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[MUST READ] Critical infrastructure protection ($BBG)

Germany plans more financial help for gas importers

Nord Stream sites off limits as authorities investigate

U.S. trade oil groups warn against banning exports

Europe accelerates deployment of electric vehicles

Bangladesh hit by widespread electricity blackout

U.S./Saudi relations strained by oil policy ($FT)

Iran’s social unrest is broadening ($WSJ)

EU28 GAS STOCKS were +158 TWh (+19%) higher on October 3 than on the same date in 2021, after one of the largest inventory accumulations on record this summer:

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Best in Energy – 1 August 2022

OPEC says Russia is essential to success of OPEC+

Lyondell plans to repurpose Houston oil refinery

New England solar reshapes electricity load curve

EU/UK ease sanctions on Russian oil trade ($FT)

U.S. threatens to sanction Iran oil trading ($WSJ)

Bangladesh sees LNG shortage until 2026 ($BBG)

China’s leaders recommit to zero-covid (trans.)

Australia explores controls on LNG exports

U.S. energy systems hit by shortages ($WSJ)

Iraq’s political crisis is intensifying ($WSJ)

CHINA’s manufacturers reported a significant contraction in activity last month with the composite purchasing managers’ index falling to 49.0 in July (2nd percentile for all months since 2011) down from 50.2 in June (33rd percentile). Repeated lockdowns are disrupting supply chains and economic activity:

U.S. GAS production was up +4.2% in May compared with the same month a year earlier, and up +3.1% in the three months March-May compared with the same period in 2021:

U.S. CRUDE OIL production fell -57,000 b/d in May compared with April as lower output from the Gulf of Mexico (-157,000  b/d) more than offset increases from the onshore Lower 48 (+95,000 b/d) and Alaska (+5,000 b/d). Onshore L48 output was up by just +468,000 b/d in March-May compared with the same period a year earlier:

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Best in Energy – 17 June 2022

White House mulls export gasoline and diesel controls ($BBG)

Australia threatens export controls on coal ($FT)

U.S. energy secretary to talk with oil refiners

Australia’s power generation shortage eases

Qatar/China negotiate joint ventures in LNG

U.S. power prices forecast to rise

U.S. GASOLINE prices at retail level and adjusted for wages are now at the highest since 2013. Wage-adjusted gasoline prices are in the 94th percentile for all months since 1994, up from the 60th percentile at the end of 2021. At this level, demand destruction should be evident within the next few months:

FREEPORT LNG’s prolonged disruption is expected to reduce exports from the United States to Europe significantly and tighten the European gas market. Reduced pipeline flows from Russia are likely to worsen the shortfall.

The premium for gas delivered in Northwest Europe rather than at Louisiana’s Henry Hub next month has more than doubled to €109/MWh up from €50 on June 7.

Europe’s summer-winter calendar spread from July 2022 to January 2023 has reverted to a backwardation of almost €3/MWh from a contango of more than €14 on June 8 as traders anticipate the market will be tighter:

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Best in Energy – 25 April 2022

China’s oil consumption tumbles ($BBG)

Russia’s crude oil production falls ($BBG)

Coal consumption hits new record ($BBG)

China oil and gas output rises rapidly ($BBG)

China’s growing domestic gas production

China only buyer for Russia divestments ($FT)

U.K. supermarkets limit cooking oil sales

Indonesia prohibits palm oil exports

Indonesia justifies palm oil export ban

Fuel tax cuts boost Russia’s oil revenues

Commodity currencies hit by global slowdown

Emerging markets fear reprise of 1994 tequila crisis

EU explores options for Russia oil embargo

India blackouts during hot weather ($BBG)

U.S. PETROLEUM inventories including the strategic petroleum reserve depleted by -13 million bbl to 1,699 million bbl in the week to April 15. There were large draws in crude (-13 million bbl) and distillate fuel oil (-3 million bbl) underscoring the continued shortage of oil in global markets and strong demand, for now, for middle distillates from manufacturers and freight firms:

INDIA’s electricity grid is struggling to meet demand as air conditioning and refrigeration loads climb with temperatures that have been well above the long-term seasonal average. Frequency remains well below the target of 50 Hz, with a control range of 49.90-50.05, for much of the day as there is insufficient generation. The situation seems to have stabilised since early April but is fragile with little or no spare capacity to absorb additional shocks or meet further demand:

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