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Global LNG prices to rise for another two years

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The European Union’s desire to reject Russian gas, the energy crisis and other reasons have led to an increase in global LNG prices. For example, prices for liquefied gas (LNG), the main type of gas with which Europeans are trying to replace piped gas from Russia, have increased by 267% over the year. 

The growth is enormous, but this is not the limit, experts say. The fact is that LNG production, which is in the plans of many oil and gas companies, needs time to increase. While gas producers will increase production, LNG prices today will continue to grow.

Europe has suddenly become the main buyer of LNG, even if not yet regarding volumes, but regarding readiness to pay any price for it. It is not surprising that LNG prices today in Europe this year are breaking one record after another. From August 12 to 19, the average spot price of a million British thermal units, for example, reached $57. 

Global LNG prices today — what is going on?

As for Asia, the largest LNG importer by volume, it will import 20.59 million tons in August, according to forecasts. On average, Asian countries bought an average of 21.34 million tons a month in the first eight months of this year. That’s less, Reuters notes, than in the first eight months of 2021, when Asia received an average of 23.03 million tons of LNG per month.

Europe’s gas problems would have been less acute had it not been for the predilection of many European countries, and, above all, Germany for short-term contracts, and the predilection of major exporters, including, incidentally, America, for long-term contracts. Negotiations to supply Qatari LNG to Germany broke down because of this.

LNG remains the only reasonable alternative to Russian pipeline gas. It takes less time to build LNG infrastructure and especially floating LNG platforms than to build gas pipelines. By the way, Germany has followed this path and is now building floating LNG platforms. The first two of them are to start working this winter.

Europe will not be able to solve the gas shortage problem in the next two-three years if it does everything planned and completely abandons Russian gas. This will worsen the gas supply situation while demand increases. Many oil and gas companies are planning to increase their liquefied gas production. But this will take a long time. So LNG prices will have no choice but to keep growing.

Earlier we reported that the price of gold per ounce is staying close to $1,760.



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Bloomberg: UAE to boost oil production beyond plan by 2025

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UAE to boost oil production

UAE to boost oil production. One of Russia’s main competitors for oil exports plans to reach five million barrels per day by 2025. The Middle Eastern country was initially expected to reach this level only by 2030, Bloomberg reported, citing sources.

“Energy concern Abu Dhabi National Oil Co. (Adnoc), which produces almost all of the UAE’s oil, wants to be able to produce 5 million barrels a day by 2025. The company planned to reach such a level only by 2030,” – says the material.

But a crude oil production boost will be difficult without additional financing for expenses for the project. Adnoc explained the acceleration of production increase by the policy of the leading countries of the world on accelerated energy transition to renewable energy sources (RES).

“As we embrace the energy transition and focus our business on the future, we will continue to explore potential opportunities that can further add value, free up capital and improve profitability,” the Arab oil company said.

To realize the goal, Adnoc has asked international companies that are partners in its oil fields to increase long-term crude production by 10% or more, sources said. In the case of positive results of the negotiations, the UAE will be able to significantly increase the volume of oil production by 2025, concludes Bloomberg.

On September 19, the Times of India, citing sources in the Indian Ministry of Commerce, reported that the Asian country has saved since February 2022, $439.7 million on imports from Russia of oil at a discount. A total of about 62.5 million barrels of Russian crude were purchased by Indian state and private companies over the last six months. Moreover, volumes of imports have increased many times over as compared to 2021.

Earlier, we reported that Nigeria stopped benefiting from the sale of Nigerian oil due to the lack of dollars.

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FT: Nigeria stopped benefiting from Nigeria crude oil sales due to lack of dollars

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nigeria crude oil sales

Nigeria’s crude oil sales used to grow steadily. But now the country, which is considered one of the world’s largest oil exporters, is facing a crisis. The country is short of dollars, and the factor of “massive theft” has only exacerbated the problems of the African state, reports the Financial Times.

“Since the beginning of the year, Nigeria’s foreign exchange reserves have fallen by 5%, to $38 billion. Restrictions on the purchase of dollars and the resulting deficit has led to the emergence of a black currency market. $1 is worth 420 naira at the official exchange rate and 700 naira on the black market,” the paper said.

Because of increasing corruption in the country, Nigeria, the world’s tenth largest oil exporter, can no longer increase production of crude oil. Nigerian crude oil buyers are not happy with this fact. The African state exports a little more than half of the established OPEC quota – 1.1 million barrels per day, instead of the required 1.8 million.

Despite all the difficulties going on in Nigeria’s economy, Timipre Silva, the African country’s Minister of State for Petroleum, announced plans to increase liquefied natural gas (LNG) exports to Europe by the coming winter. According to him, to realize this goal, it is necessary to improve safety in Nigeria’s fields and infrastructure.

Earlier we reported that coffee stocks in Brazil in six months will approach a record low level

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Coffee exporters in Brazil: coffee stocks in Brazil in six months will approach a record low level

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coffee exporters in Brazil

Coffee exporters in Brazil said that coffee stocks in the largest coffee-producing country in the world – Brazil – in six months will fall to a record low level. This was written by Bloomberg agency about the statement of the president of the National Council of Brazilian Coffee Silas Brasileiro.

According to his forecast, stocks of coffee in Brazil’s coffee supply companies by March will drop to 7 million bags, whereas analysts consider a comfortable level of 9-12 million bags of 60 kg each.

Cecafe Exporters Group board member Nelson Carvallaish said the country’s coffee stocks are so small that even if next year’s crop is good, Brazil will barely have enough coffee to meet demand.” “We just need rain,” he concluded.

In August, The Wall Street Journal wrote that the price of coffee could rise seriously by the end of 2022 because of Brazil’s poor harvest. 

Earlier we reported that aluminum production in China in August reached a record 3.51 million tons.



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