Latest news with #gasmarket
Bloomberg
22-07-2025
- Business
- Bloomberg
Global LNG Supply to Surge Most Since 2019 Next Year, IEA Says
By and Elena Mazneva Save Global supply of liquefied natural gas is set to surge the most since 2019 next year, primarily driven by production additions in North America, the International Energy Agency said. The increase in supply will accelerate to 7%, or 40 billion cubic meters a year in 2026, following a 5.5% expansion this year, the IEA said in its quarterly gas market report. A project in Qatar will also add to the growth.
Bloomberg
03-07-2025
- Business
- Bloomberg
Canada LNG Is the First Sign of a Global Gas Oversupply
Welcome to our guide to the commodities markets powering the global economy. Today, Asia energy team leader Stephen Stapczynski looks at the first signs of a long-awaited wave of global gas supply. Meanwhile, Swedish miner LKAB is preparing its Arctic railway for a militarized future. After years of tight supply and wild price swings in the global gas market, there are signs of something different: too much of a good thing.
The Guardian
02-07-2025
- Business
- The Guardian
An impending gas shortfall in eastern Australia? This is just gas market Groundhog Day
The Australian Competition and Consumer Commission is yet again warning of imminent gas shortfalls for Australia's east coast. In response, the federal government has announced another review into whether we need to reform our gas market regulation. Given the ACCC has been running a gas market inquiry since 2017 and has been saying pretty much the same thing every year since – essentially that gas producers treat Australian consumers like second class citizens – isn't the answer blindingly obvious? For the past few years, the gas market has been stuck in Groundhog Day. Each year the gas producers tell us that the only problem is slow government approvals for new developments. Interestingly governments have approved many new gas developments, for example Santos' Narrabri gas field was approved in 2020 but is yet to proceed. Yet each year we find ourselves in the predicament of imminent shortfalls. Then the government steps in to 'negotiate' (or is it beg?) for the gas producers to pretty please provide some extra gas to domestic consumers at a price that won't cripple them. In response the gas companies miraculously find some extra gas under the couch and dribble out a little bit more, but not too much that it might noticeably reduce prices. Some gas producers appear to be engaged in a phenomenon so well known to economists they've invented a term for it: 'strategic withholding'. This is where a producer knows that if they pull back a bit on production then they can force up prices enough that it will increase their overall long-term profits. So, the government can grant permission to exploit extra gas fields, but that doesn't mean a producer will give us extra gas if it will reduce prices. The Victorian government proposed that in order to assist manufacturers desperate for gas, it would free up gas supply for them by switching households away from gas appliances to electric-powered ones. This would not only assist manufacturers, it would also leave households financially better off. Independent analysis by the Institute of Energy Economics and Financial Analysis found it would save households $6.3bn on their energy bills over 10 years, compared with an extra cost of new appliances of $3.5bn. Not to mention it would substantially reduce carbon emissions. The counterattack from the oil and gas lobby was vociferous. The gas pipeline lobby has been threatening that they'd be massively hiking pipeline charges to make up for the loss of revenue from households. There have been claims that the forthcoming gas shortage was somehow the fault of the Victorian government for being 'anti-gas'. This went to the extent of Santos accusing the Victorian government of being akin to that of North Korea. You just had to ignore the fact that gas pipeline flow data clearly shows gas suppliers have been funnelling large quantities of Victorian gas northward for years. Meanwhile the net gas coming south from Queensland's gas exporters has been a tiny dribble. You also had to ignore the fact that under this 'anti-gas' government, gas producers have been free to pursue new Victorian gas supply investments in recent times involving hundreds of millions of dollars. In the face of attacks, the Victorian government pulled back from a phase-out of gas heaters. This would have been the greatest financial and gas supply benefit to consumers of any single energy policy currently in contemplation by Australian governments. Victorian residential gas heating is responsible for about 70 petajoules of gas consumption per annum which is 20% more gas than currently consumed by all of Victoria's manufacturing facilities and around two to four times the amount of gas used in power generation in Victoria. Another way of looking at it is that it would provide around the same amount of extra gas as former federal Liberal leader Peter Dutton had promised under his gas reservation policy. A policy which his colleagues had claimed would 'flood' the market with gas. Yes, a gas heater phase out would have overruled consumer choice. But how many households do you know that when confronted with a broken down heater in winter think through the gas market supply-demand balance over the next decade in deciding what to do? How many pull out a spreadsheet to evaluate the costs and benefits for them to switch over to electric compared to industrial manufacturers? Those who claim we must leave consumers to choose are the same types of people that gullibly believed oil and gas companies would put the interests of Australian consumers first over making money from LNG export plants. Tristan Edis is director of analysis and advisory at Green Energy Markets
The Guardian
01-07-2025
- Business
- The Guardian
Labor is open to fresh options to secure east coast gas supplies. Is it about to make a radical shift?
A sweeping review of domestic gas market regulation will be conducted over the next six months as the federal government attempts to shore up supplies of a fossil fuel it argues is critical to energy affordability, security and the renewables transition. The government has opened the door to establishing a scheme to reserve east coast gas for domestic use – an idea it criticised when Peter Dutton pursued it at the federal election. As the consumer watchdog issues fresh warnings about looming supply shortfalls, the climate change and energy minister, Chris Bowen, said the federal government would consider 'well-calibrated opportunities to ensure that Australian users get access to Australian gas'. Regulation of the gas market is complicated to say the least. The federal government has three mechanisms designed to ensure sufficient supplies of gas for Australian households, business and industry while allowing gas companies to honour LNG export contracts. The Australian Domestic Gas Security Mechanism – colloquially known as the 'trigger' – is a Malcolm Turnbull-era tool that allows the commonwealth to restrict LNG exports if domestic shortfalls are forecast. Then there's the code of conduct, which the Albanese government introduced in 2023 after Russia's invasion of Ukraine sent global gas prices soaring. The code currently sets a $12-a-gigajoule price cap for domestic sales, while offering exemptions to companies that commit to extra supply. Finally, the government has a 'heads of agreement' with major LNG exporters to safeguard domestic supplies. With reviews into two of those mechanisms due this year, the government has now decided to examine all three at once. And it's leaving open the option of making minor tweaks or wholesale changes. The idea of forcing companies to 'reserve' gas for domestic users, rather than allowing the bulk of it to be sold on the lucrative export market, has long been touted as a straightforward solution to prevent local supply shortfalls. The Australian Competition and Consumer Commission (ACCC) this week warned of a 'deteriorating outlook' for supplies for the east coast in 2025 and 2026, with shortfalls projected from 2028 unless new supply was brought into the market. Groups such as the Australia Institute argue Australia would have more than enough gas if the largely foreign-owned producers weren't exporting the vast majority of it. Western Australia has had a gas reservation since 2006, which requires offshore gas producers to set aside 15% of their gas for the domestic market. Queensland has its own version, which means gas developed through certain tenements can only be sold and used in Australia. But no such regime is in place across the east coast, with the major political parties historically resistant to the market intervention. That changed ahead of this year's federal election with Dutton promising to create an east coast gas reservation if the Coalition was successful. Under Dutton's plan, which the opposition is yet to either dump or re-adopt, a 'gas security charge' would be used to incentivise LNG exporters to keep more supplies onshore. The proposal sparked alarm inside the gas industry, and was ridiculed by experts and dismissed as unnecessary by Labor, which maintained it had already secured substantially more gas through its code of conduct than Dutton's reserve would. But almost two months on from its thumping election win, Labor has signalled it is open to looking at some form of reservation scheme as part of the new review. Sign up for Guardian Australia's breaking news email Asked on Monday if producers should prepare for a gas reserve, Bowen noted that 660 petajoules worth of supply had already been locked in via the code of conduct. 'Now, that's not to say there isn't more to do, and [the resources] minister [Madeleine] King and I will look at sensible, holistic, carefully designed, well-calibrated opportunities to ensure that Australian users get access to Australian gas. I think that's reasonable. That's a reasonable request by the Australian people and one that we will continue to work to deliver,' he said. Bowen all but confirmed any reservation scheme would be limited to new projects, a key difference from Dutton's proposal, which would have captured existing supplies except for those already under contract. 'One thing we won't contemplate is ripping up existing contracts, creating sovereign risk, engaging in behaviours which would see Australia as an unreliable supplier. We won't be doing that,' Bowen said. A consultation paper published on Monday outlined potential options to regulate supply that ranged from 'minimal change' to 'fundamental reform'. The 'fundamental reform' option would involve a new framework that required all LNG exports to be approved subject to conditions, including relating to supply and price. Mark Ogge, a principal adviser to the Australia Institute, said a review was unnecessary when the government already had 'all the tools it needs to ensure Australia has a plentiful supply of gas'. 'The government should not allow any uncontracted gas to be exported unless the Australia market is plentifully supplied with low-cost gas,' he said. 'This is a resource that belongs to Australians.' The federal opposition said the review could not be used to avoid or stall immediate action to bring down prices or avert gas shortages, without offering solutions of its own. The Greens said the review must crack down on profiteering by the gas giants. 'Massive gas corporations are exploiting loopholes to make massive profits off Australia's gas,' the Greens environment spokesperson, Sarah Hanson-Young, said. Australian Energy Producers, the peak body for gas companies, said the review was an 'opportunity to future-proof the east coast gas market and ensure reliable and affordable gas supply for Australian households and manufacturers'. Submissions to the review are open until 15 August. A report will then be handed to Bowen and King to consider the next steps.
News.com.au
30-06-2025
- Business
- News.com.au
Chris Bowen flags greater government intervention in energy markets with Gas Market Review
Labor will consider forcing gas companies to redirect future supplies into the domestic market instead of selling to international markets, with Energy Minister Chris Bowen launching a review into Australia's gas market. The Australian Competition and Consumer Commission warned on Monday Australia's east coast gas supply outlook has further deteriorated, with risks of a shortfall beginning from the fourth quarter of 2025 and into 2026 set to increase if 'Queensland LNG producers export all uncontracted gas'. This is because southern states like NSW, Victoria, South Australia and Tasmania will need to 'continually rely on gas from Queensland as their local reserves deplete,' the ACCC's interim Gas Inquiry report, published on Monday, warned. The ACCC says tipped 'structural shortfalls' on the east coast will continue from 2028 unless new gas supplies are brought online. The government's Gas Market Review will look at how regulations can be improved to ensure affordable and adequate domestic gas supply, with Mr Bowen flagging the importance of gas as a firming power, alongside renewable energy, which will make up 82 per cent of Australia's grid. However, he said existing commercial contracts with international partners will be protected. Australia is one of the world's largest liquid natural gas exporters with export earnings reaching a record $92.8bn in 2023. 'One thing we won't contemplate is ripping up existing contracts, creating sovereign risk, engaging in behaviours which will see Australia (considered) as an unreliable supply. 'We won't be doing that, but what we will be looking at is sensible, forward looking, prospective means to ensure that Australians get access to their gas.' While Mr Bowen wouldn't be drawn on whether this would mean ramping up gas supplies, or creating an East Coast Gas Reserve, he said it was a 'reasonable request' to ensure 'Australian users get access to Australian gas'. The review will also look at consolidating the Australian Domestic Gas Security Mechanism, Gas Market Code and Heads of Agreement with major east coast gas exporters to 'holistically' ensure policy can support the 'efficient supply of gas to industrial users, domestic users, and to the energy system'. Separately, Mr Bowen also commented on Adelaide's bid to host climate conference Cop31 in 2026, with negotiations at a standstill due as Turkey also pitches for the rights. The McMahon MP said while the bidding issue 'has not yet been resolved,' Australia had the support of the Western Europe Group. He also declined to give an estimated cost for the event, but said there would be 'revenue opportunities' through sponsorship and attendance fees. 'This is a remarkable opportunity for Australia. It's the world's largest trades fair,' he said. 'It gives us an opportunity to talk to the world about Australia's capacity to help them decarbonise. 'It's a remarkable opportunity for the Pacific (to) put their issues on the table. If and when we're successful, of course, we'll have more to say about costs.'
