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Energy / Natural Gas

  • Leaked Document Could Shatter UK Shale Dreams

    U.K. Prime Minister David Cameron’s hopes for a British-style shale gas revolution recently took a major hit. Cameron has promised that his government will be “going all out” to develop Britain’s shale gas resources, which he argues will create new jobs and cut dependence on imported gas. But a committee made up of members of parliament (MPs) from several political parties issued a damning new report on the state of “fracking” in the United Kingdom. The Environmental Audit Committee published a report that called for a 30-month moratorium on fracking, citing “huge uncertainties” regarding the environmental fallout from widespread drilling.…

  • New England Growing More Dependent On Natural Gas

    New England may avoid a spike in natural gas prices this winter, but the region is becoming increasingly dependent on the fuel, ensuring that price spikes in future years are not out of the question. A year ago, the polar vortex brought several bouts of low temperatures and heavy snow to the northeast, causing demand for heating and electricity to jump. Temporary shortages in natural gas flows due to pipeline constraints led spot prices to shoot up. Prices at Algonquin Citygate, a marker for the Boston area, hit an all-time high of $77.595 per million Btu (MMBtu) on January 23,…

  • Russian Gas Provides Lifeline To Chinese Expansion

      The shale gas game began to cool in China after the latest plunge in oil prices. However, thanks to the recently concluded Power of Siberia pipeline deal, Beijing will be able to rely on a stable supply of natural gas from Russia during a highly volatile time for the market. Ever since 2010, when the State Dept. first introduced fracking as a panacea for all energy problems, the technology has transformed the US energy sector, but it has remained more of a psychological phenomenon in Asia. The fracking game is over in both China and continental Europe, as a…

  • A Trade Idea Based Solely On Risk/Reward

    As some may be aware, I spent nearly twenty years making a living in a dealing room. Contrary to what many believe, those who are paid to trade are, in my experience, not necessarily smarter or better educated than those who pay for the privilege. They have better, faster access to information for sure, and they also have the focus that comes from concentrating on one market all day every day, but it is possible for anybody trading at home to get the same info and to specialize. There is, however, one major thing that sets floor traders apart. Their…

  • Drought Forcing Brazil To Turn To Gas

    Brazil is dealing with one of its worst droughts in years, causing the city of Sao Paulo to suffer through rolling blackouts. Blistering heat and scant rainfall have depleted reserves at Brazil’s hydroelectric plants, leaving power generation at precariously low levels. On January 19, Brazil’s national grid operator ONS cut power to several major Brazilian cities, including Sao Paulo and Rio de Janeiro. Commuters on the subway in Sao Paulo even had to disembark from a train and walk along the rails after power to parts of the subway system went out. A failure in transmission equipment was in part…

  • Expanding Russia Issues Europe An Ultimatum

    Don’t tell the West, but Vladimir Putin isn’t changing. The Russian President has skipped their little ‘lesson’ on 21st century politics in favor of his own, unadulterated, version. In what we’ve come to expect, Putin is set to formally absorb South Ossetia – Georgia’s breakaway republic – and Gazprom is prepared to deny Europe up to one-quarter of its annual exports to the continent. What’s more, the conflict continues in Ukraine and allegations of Russian financing are growing louder. As we remarked earlier, Russia has enjoyed a less than ideal start to 2015. In line with crude prices, the ruble…

  • What Part Did Russia Play In Kyrgyzstan-Uzbekistan Gas Dispute?

    Kyrgyzstan is happy because 60,000 customers in a potentially restive part of the country aren’t relying on dung to heat their homes; Uzbekistan again has revenue from the cross-border gas trade; and Russia, whose energy giant Gazprom promised a constant supply of gas when it bought Kyrgyzstan’s gas distribution network last year, gets to save face. But the sudden resumption of gas deliveries from Uzbekistan to Kyrgyzstan on December 30 begs two related questions: Why wasn’t a deal reached earlier, after Uzbekistan abruptly cut supplies last April? And what made the recalcitrant Uzbeks change their mind?Related: Is Big Change On The…

  • LNG Another Casualty Of Low Oil Prices

    The oil industry is facing rising debt from collapsing oil prices, but there could be another sector that becomes a casualty of the low oil price environment: liquefied natural gas (LNG). Much of the global LNG trade occurs in Asia, where buying and selling occurs according to long-term fixed contracts that are indexed to the price of oil. As a result, when oil prices were high, so were LNG prices. That is exactly why there has been a rush along the U.S. Gulf Coast to begin exporting cheap American natural gas to take advantage of high prices in Asia. The…

  • Ample Natural Gas Supplies Mean No Repeat of Winter Price Spikes

    The mercury is dropping in much of the United States, but a repeat of 2014 natural gas price spikes is likely not in the cards. The harsh winter in January and February of last year prompted an excessive draw down of natural gas stocks, with inventories dipping far below the running five-year average. With shortages in certain regions, particularly in and around New York and Boston, natural gas prices shot up. Henry Hub prices briefly doubled from just above $4 per million Btu (MMBtu) in January, to above $8 per MMBtu in the first week of February. That has prompted…

  • Iran Hoping Natural Gas Can Save It From Low Oil Prices

    Iran appears to be shifting its attention from low-priced oil to gas, gearing up to increase production to 100 million cubic meters of gas per day at its South Pars field by March 20, the end of the country’s calendar year. Iran’s oil minister, Bijan Namdar Zanganeh, said Jan. 2 that the National Iranian Gas Co. (NIGC) has been developing new “phases,” or development areas, in South Pars, the largest known gas field in the world. The field, situated in the Persian Gulf, contains an estimated 14 trillion cubic meters of natural gas and 18 billion barrels of condensates. It…