The global gas glut has returned as it was always going to.
The US is swimming in it:
The EU is swimming in it:
All the more remarkable because US exports replaced most of Russian:
The Asian gas price is collapsing with more ahead, punctuated by winter cold snaps:
Aussie spot prices are ridiculous again (but still a long way down from $70GJ during the Ukraine War shock):
But, at least coal and renewables have marginalised gas in the elelctricity market for now:
Meaning the electricity price has kept falling:
Australia’s most cowardly modern treasurer, Jim “Chicken” Chalmers is playing at being the energy hero:
In the most explicit sign to date the Albanese government was considering another round of cost of living relief, Dr Chalmers signalled he was open to extending one-off measures including subsidies to lower household energy bills.
“People shouldn’t anticipate big new measures in the mid-year update next week. But obviously as we get closer to the budget in May, if there’s more that we can do, which is consistent with our budget constraints and is right for the economic conditions at the time, then… we’re prepared to contemplate it,” Dr Chalmers said.
An extension of cost of living relief at the May 2024 budget would be a major selling point for the Albanese government in the lead up to the next federal election, due by either late 2024 or early 2025.
Only if everybody is brain-dead. Chalmers is only aiming to ease a problem of his own making.
It was he who led the cowardly response to the Ukraine War profiteering shock that should never have been allowed to take hold in Australia. He was too scared of the miners to install local price caps. By the time capping the locl gas price became a matter of national survival six months and 1000% gas price hikes later, Chalmer’s cowardice had embedded an energy inflation shock that would last two years and 100bps of rate hikes.
Now he is chasing his own tail:
Energy price cuts are coming in the back half of 2024. If Chalmers had any brains or balls he would triple his energy subsidies to bring the discounts forward.
And push through emergency reforms to the Australian Energy Market Regulator. It needs to reset the default market price that benchmarks retail bills more frequently. Quarterly or bi-annually instead of yearly.
Ergo, it won’t happen.
