In the past year, the price US consumers pay for natural gas has more than doubled. About 38 percent of electricity in the US comes from natural gas according to the Energy Information Administration EIA.
And about half of the homes in the United States use natural gas for space heating and water heating.
Natural Gas Surges With US LNG Export Terminal Set for Fast Restart
Yesterday, Bloomberg reported Natural Gas Surges With US LNG Export Terminal Set for Fast Restart.
US natural gas prices surged after a key export terminal in Texas reached an agreement with regulators to restart as soon as October after an explosion.
Freeport LNG, which was shut down in June after a blast, has entered into an agreement with the Pipeline and Hazardous Materials Safety Administration to resume operations in early October at almost full capacity, the operator said in a emailed statement Wednesday. That would boost demand for natural gas by nearly 2 billion cubic feet a day, equivalent to roughly 2% of domestic output.
The restart of Freeport LNG is poised to increase the strain on US inventories of the heating and power-generation fuel ahead of winter. Concern about tightly supply has triggered stomach-churning volatility and led prices to more than double this year. Gas held in salt caverns and depleted aquifers is about 12% below levels typically seen for this time of the year, and booming domestic demand this summer has limited suppliers’ ability to add gas to storage.
Stockpile Deficit
Heading into Winter, the stockpile of US natural gas is about twelve percent below normal.
EU Natural Gas Price
In the European Union, the price of natural gas shot up from 43.869 to a record 199.25, about 4.5 times vs a year ago.
Thanks to sanctions and the now-abandoned Nord Stream II pipeline from Russia to the Europe, the EU is struggling to get gas.
Marine Le Pen Calls for End to Sanctions
Marine Le Pen: “The Russian economy is not on its knees and Russia is not in default, we are far more victims of energy sanctions than Russia….these sanctions must end” pic.twitter.com/28lU08fh2l
— ☦️Jacob🇷🇺Charite☦️ Иагов (@jaccocharite) August 3, 2022
RFI reports French Far Right Leader Le Pen calls for an End to ‘Useless’ Russia Sanctions.
“I want these sanctions to end,” Le Pen said at a parliamentary press conference on Tuesday. “Otherwise Europe is going to face a blackout, notably on the question of Russian gas imports. “The sanctions are simply useless. All they do is make Europeans suffer. And that, incidentally, includes French people.
“You’d need a huge dose of bad faith not to realize that, contrary to the inflated claims of our government, the Russian economy is not on its knees. They are not on the brink of bankruptcy.
“We are suffering far more from these sanctions than the Russians are,” said the MP for the northern Pas-de-Calais constituency. They can find other buyers for their oil and gas, they can get around the embargoes, she added. “This has been a series of failures by the European Union.”
Sanctions Don’t Work, Le Pen is Correct
Le Pen is correct on all counts. Putin is delivering only 20-40% of normal gas supply to Europe but at a price that is 4.5 times higher.
Thus, Russia is making more for selling less.
Global Natural Gas Flow
Instead of getting natural gas from hundreds of miles away over existing pipelines we compress natural gas in the US then ship it 4,700 miles away Europe.
Meanwhile, Russia fearing eventual European cutoff is building new pipelines to China.
De-globalization to punish Russia and China is seriously impacting global supply chains and increasing costs for everyone,
The one point Le Pen misses is that the EU would still vulnerable because Russia can no longer be considered a reliable partner. Once Russia has pipelines to China, it will not need the EU.
That is years away however. Meanwhile, supply chain disruptions and de-globalization are driving prices up everywhere.
For further discussion, please see De-Globalization: New Supply Chains Are Inefficient and Will Drive Up Inflation
We have economic illiterates running the country and running the Fed. The average Joe is getting killed.
Dear President Biden, the above charts speak for themselves. If you want to lower inflation, stop the sanctions.
This post originated on MishTalk.Com.
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“Russian President Vladimir Putin told Former German Chancellor Gerhard Schroeder that the Nord Stream 2 natural gas pipeline could be activated if necessary, Kremlin Spokesperson Dmitriy Peskov confirmed Wednesday.
Speaking to reporters in the Russian capital Moscow, Peskov said the comment was made during Schroeder’s meeting with Putin in Moscow.
According to Peskov, Schroeder, like many experts, expressed his concern over the energy crisis and demanded during his meeting with Putin that Russia issue a statement on its approach to energy developments.
In response to Schroeder’s question on activating the Nord Stream 2 pipeline in the event of a crisis, Putin replied that it is technically possible, although he said the project needs a lot of work for immediate use.
Nonetheless, Peskov confirmed that it would not be possible for the Nord Stream 2 to operate at full capacity until the end of the year, even if it is commissioned today.
“Only at half capacity, 27.5 billion cubic meters can be shipped, because the other half of the capacity is used for domestic consumption,” he said.”
“Australia is again facing a domestic gas shortage because of excessive exports, and the Australian Competition and Consumer Commission is warning that the government must impose limits on LNG exports to secure local supply.
This warning follows a decision by the Australian Energy Market Operator to activate a supply guarantee mechanism that was set up in the wake of another looming shortage a few years ago when the Australian government realized it needed a way to ensure that the local market would be well supplied with gas despite rising LNG exports.”
metropolitan areas and higher in 1 area, the U.S. Bureau of Labor Statistics
reported today.