Released January 03, 2023 | SUGAR LAND
en
Editorial by Geoffrey Lakings for Industrial Info Resources (Sugar Land, Texas) - January 2023. Welcome to yet another volatile new year ahead for the global gas markets, even as natty in North America has returned to trading at a $4 handle. But for how much longer one wonders? Hhhhm. Likely will be back over $6 before the end of winter. A winter which is still coming, having already having experienced Winter Storm Elliot in North America.
Then natty prices will again be pushing $7 by the time summer rolls around. Wait a minute, isn't that what happened in 2022?
Reuters: Coal, gas lead 2022 commodities rally; recession clouds new year - Coal and natural gas markets ended 2022 with strong gains on Friday after a global energy crisis triggered by the Russia-Ukraine war stoked prices, and tighter supplies expected in 2023 could fuel more gains.
Why does another volatile year lie in store? Because the Dragon in the East -- China -- is opening up her maw once again after slumbering for most of 2022 due to restrictive zero-COVID policies. And, she will be hungry to feed her industrial fires fueled by hydrocarbons. Meaning this summer as Europe tries to fill inventories to get ready for next winter -- with their Russian supply of gas continuing to dwindle -- there will be global competition. Bring on the volatility. And the mayhem.
Fortune: China's reopening is going to be a gas guzzler - If the energy crunch was bad this year, China's recent loosening of COVID-19 protocols could spell a disastrous global crisis in 2023.
Since the Russian invasion of Ukraine in February, many countries around the world have had to contend with mounting energy bills, sparked by sudden cutoffs in Russian oil and natural gas shipments abroad. Countries have resorted to energy rationing and stockpiling reserves ahead of winter, when energy demand is highest.
So far, they have largely been successful in their efforts. Europe, at high risk of an energy crisis due to its elevated reliance on Russian oil and gas prior to the war, was declared "off the hook" this winter by IEA chief Fatih Birol on Monday as the continent has benefited from a mild winter so far.
But fret not. The IEA has a plan. Well, actually a report.
IEA: How the European Union can avoid natural gas shortages in 2023 - IEA report sets out key actions to close potential supply-demand gap if Russian pipeline deliveries fall to zero, including more rapid deployments of energy efficiency and renewables
The European Union faces a potential shortfall of almost 30 billion cubic metres of natural gas in 2023 -- but this gap can be closed and the risk of shortages avoided through stronger efforts to improve energy efficiency, deploy renewables, install heat pumps, promote energy savings and increase gas supplies, the IEA says in a new report released today.
Wonder if one should be worried? I know I am. For so much had to "go right" in 2022 for Europe to fill their storage caverns ahead of winter. The U.S. had to "show up" with their LNG cargoes. China had to "take less gas." Mother Nature had to cooperate in regards to weather, etc.
And, now that winter is here it needed to be a mild one. And Old Man Winter -- for the most part -- is complying.
Reuters: 83.3% of EU gas storage is filled - The European Union's reliance on Russian gas and the risk that Moscow could cut supplies has pushed the bloc to target an 80% filling level of its storage sites by Nov.1, in time to meet high demand during winter.
Although the winter gas season usually begins in early October, when heating demand rises, Europe experienced milder weather than usual for the time of year, and this delayed the withdrawals from inventories by more than a month.
Emphasis on -- "for the most part," as the U.K. is preparing for another "Beast from the East."
Mirror: Beast from the East is coming BACK as Britain set to be blasted by snow - Forecasters are keeping a close eye on a Polar vortex of cold air over the North Pole which has the potential to cause a weather phenomena akin to the Beast from the East in the UK Some forecasts predict a collapsing Polar vortex could trigger a major freeze this month akin to the epic storm from February 2018.
Such plummeting temperatures could cause further difficulties as the country battles to cope with the cost of living crisis - with many still reluctant to turn on the heating.
Meteorologists are reported to be keeping a close eye on a pool of cold air spinning over the North Pole which has the potential to spark a Sudden Stratospheric Warming event, also known as an SSW.
And we understand that the one thing we struggle to truly know is what lies in store for these Energy Markets -- especially the global gas market -- in 2023. But nonetheless one tries his best to predict the future. Which will be a volatile one. Likely devolving into calamity.
Forbes: 8 Consequential Energy Predictions For 2023 - ...The oil and gas midstream sector will continue to be hampered by FERC - The Biden administration will maintain efforts to obstruct permitting of major new interstate pipeline projects needed to facilitate growth of natural gas production in major shale basins like the Marcellus and Haynesville plays. Such efforts are, after all, an integral piece of the overarching Biden energy plan.
This in turn will hamper growth of the U.S. LNG export industry at a time when more LNG cargoes are in high demand across Europe and Asia. These ongoing efforts by the Federal Energy Regulatory Commission (FERC) to obstruct new interstate pipeline infrastructure will continue to be the most destructive and damaging aspect of the Biden energy policy.
Europe's energy crisis will evolve into an energy calamity in 2023 - Unfortunately, this outcome seems unavoidable unless a quick end to Russia's war on Ukraine suddenly materializes. That outcome would at least enable Europe to renew its dependency on Russia for oil and natural gas resources.
While that's a foolish dependency, it might seem more attractive to Europe's leaders than the current situation that has the continent burning record amounts of coal and even wood for electricity, and paying extreme high prices for whatever LNG imports it is able to secure from the U.S. and other exporting nations.
Let IIR Energy's Dedicated Market Research place the world at your fingertips... Tomorrow's News Today... Ask us! We have Answers!!
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Then natty prices will again be pushing $7 by the time summer rolls around. Wait a minute, isn't that what happened in 2022?
Reuters: Coal, gas lead 2022 commodities rally; recession clouds new year - Coal and natural gas markets ended 2022 with strong gains on Friday after a global energy crisis triggered by the Russia-Ukraine war stoked prices, and tighter supplies expected in 2023 could fuel more gains.
Why does another volatile year lie in store? Because the Dragon in the East -- China -- is opening up her maw once again after slumbering for most of 2022 due to restrictive zero-COVID policies. And, she will be hungry to feed her industrial fires fueled by hydrocarbons. Meaning this summer as Europe tries to fill inventories to get ready for next winter -- with their Russian supply of gas continuing to dwindle -- there will be global competition. Bring on the volatility. And the mayhem.
Fortune: China's reopening is going to be a gas guzzler - If the energy crunch was bad this year, China's recent loosening of COVID-19 protocols could spell a disastrous global crisis in 2023.
Since the Russian invasion of Ukraine in February, many countries around the world have had to contend with mounting energy bills, sparked by sudden cutoffs in Russian oil and natural gas shipments abroad. Countries have resorted to energy rationing and stockpiling reserves ahead of winter, when energy demand is highest.
So far, they have largely been successful in their efforts. Europe, at high risk of an energy crisis due to its elevated reliance on Russian oil and gas prior to the war, was declared "off the hook" this winter by IEA chief Fatih Birol on Monday as the continent has benefited from a mild winter so far.
But fret not. The IEA has a plan. Well, actually a report.
IEA: How the European Union can avoid natural gas shortages in 2023 - IEA report sets out key actions to close potential supply-demand gap if Russian pipeline deliveries fall to zero, including more rapid deployments of energy efficiency and renewables
The European Union faces a potential shortfall of almost 30 billion cubic metres of natural gas in 2023 -- but this gap can be closed and the risk of shortages avoided through stronger efforts to improve energy efficiency, deploy renewables, install heat pumps, promote energy savings and increase gas supplies, the IEA says in a new report released today.
Wonder if one should be worried? I know I am. For so much had to "go right" in 2022 for Europe to fill their storage caverns ahead of winter. The U.S. had to "show up" with their LNG cargoes. China had to "take less gas." Mother Nature had to cooperate in regards to weather, etc.
And, now that winter is here it needed to be a mild one. And Old Man Winter -- for the most part -- is complying.
Reuters: 83.3% of EU gas storage is filled - The European Union's reliance on Russian gas and the risk that Moscow could cut supplies has pushed the bloc to target an 80% filling level of its storage sites by Nov.1, in time to meet high demand during winter.
Although the winter gas season usually begins in early October, when heating demand rises, Europe experienced milder weather than usual for the time of year, and this delayed the withdrawals from inventories by more than a month.
Emphasis on -- "for the most part," as the U.K. is preparing for another "Beast from the East."
Mirror: Beast from the East is coming BACK as Britain set to be blasted by snow - Forecasters are keeping a close eye on a Polar vortex of cold air over the North Pole which has the potential to cause a weather phenomena akin to the Beast from the East in the UK Some forecasts predict a collapsing Polar vortex could trigger a major freeze this month akin to the epic storm from February 2018.
Such plummeting temperatures could cause further difficulties as the country battles to cope with the cost of living crisis - with many still reluctant to turn on the heating.
Meteorologists are reported to be keeping a close eye on a pool of cold air spinning over the North Pole which has the potential to spark a Sudden Stratospheric Warming event, also known as an SSW.
And we understand that the one thing we struggle to truly know is what lies in store for these Energy Markets -- especially the global gas market -- in 2023. But nonetheless one tries his best to predict the future. Which will be a volatile one. Likely devolving into calamity.
Forbes: 8 Consequential Energy Predictions For 2023 - ...The oil and gas midstream sector will continue to be hampered by FERC - The Biden administration will maintain efforts to obstruct permitting of major new interstate pipeline projects needed to facilitate growth of natural gas production in major shale basins like the Marcellus and Haynesville plays. Such efforts are, after all, an integral piece of the overarching Biden energy plan.
This in turn will hamper growth of the U.S. LNG export industry at a time when more LNG cargoes are in high demand across Europe and Asia. These ongoing efforts by the Federal Energy Regulatory Commission (FERC) to obstruct new interstate pipeline infrastructure will continue to be the most destructive and damaging aspect of the Biden energy policy.
Europe's energy crisis will evolve into an energy calamity in 2023 - Unfortunately, this outcome seems unavoidable unless a quick end to Russia's war on Ukraine suddenly materializes. That outcome would at least enable Europe to renew its dependency on Russia for oil and natural gas resources.
While that's a foolish dependency, it might seem more attractive to Europe's leaders than the current situation that has the continent burning record amounts of coal and even wood for electricity, and paying extreme high prices for whatever LNG imports it is able to secure from the U.S. and other exporting nations.
Let IIR Energy's Dedicated Market Research place the world at your fingertips... Tomorrow's News Today... Ask us! We have Answers!!
As your feedback is very important to us. Please let us know if we may provide additional color or answer any other market questions you may have by replying to this note.
Additional IIR Resources:
- IIR Team Email: iirteam@iirenergy.com
- Latest IIR Crude & Products Market Scorecard
