G7⁺ agree to set fixed price cap for Russia oil exports ¹
Netherlands regulator supports TTF gas benchmark
Global coal consumption set for new record ($BBG)
U.S. tech firms enter downturn with layoffs ($WSJ)
Europe’s floating LNG storage queue ($FT)
¹ A fixed price cap that will be reviewed regularly in the light of market conditions sounds a lot like creating an “Organization of Petroleum Importing Countries” (OPIC) with all the resulting problems of information collection, analysis, forecasting and decision-making. OPEC has struggled to be an effective market manager; there is no reason to think OPIC will be any more successful.
Some operational and policy questions for OPIC:
- How will the organisation estimate current production and consumption?
- How will the organisation forecast future production, consumption, inventories and prices?
- Will OPIC seek input from oil traders and refiners?
- Will OPIC hold regular meetings to decide policy?
- How often will the organisation review and revise the price cap?
- Will OPIC coordinate with OPEC and OPEC⁺ ?
- What is the relationship between OPIC and the IEA?
- How will OPIC respond if Russia cuts production and exports?
- Will the U.S./IEA release more crude and product stocks to counter any interruption of Russia’s oil exports?
- Will G7⁺ set policy unilaterally or will it take into account the interests of third-country importers (e.g. China and India)?
U.S. GAS INVENTORIES rose by +107 billion cubic feet (bcf) in the week to October 28. Inventories have increased by a total of +2,119 bcf since the start of April, the fastest seasonal rise since 2019 and before that 2015. Stocks are still -203 bcf (-5%) below the pre-pandemic average for 2015-2019 but the deficit has narrowed from -401 bcf (-14%) since mid-August: