Gas cartel horrified by transparency

Via the AFR:

Gas producers are privately voicing reservations about proposals that would require them to report on sales contracts, reserves and export prices, worried that the measures intended to increase transparency in the under-pressure east coast market could put them at a commercial disadvantage.

The recommendations, released by the national competition regulator and the Gas Market Reform Group just before Christmas, are intended to give more visibility to gas buyers on the market for the fuel, while stimulating competition among producers.

Well they might be concerned. Opacity in the failed market is enabling the cartel to gouge magnificently. The ADGSM has helped bring contract prices into line with export net-back:

But we only know this thanks to ACCC monitoring which is shining a light on contract prices.

As well, if you think, as I do, that export net back is the wrong benchmark for the ADGSM and it should be shifted to some hard price target around $5-6Gj to disconnect local prices from global then opacity is a deadly enemy.

This should still be Labor’s first act of power.

Comments

  1. Jumping jack flash

    Unless the government begins to set up their own gas companies, acquire gas, and then sell it cheaply to manipulate the market I think anything they do that would have any actual effect will be meddling in private companies’ business.

    And yes, the private companies are right to say that it will give them a disadvantage in the wider market, because it will. Then the unintended consequences arrive – because the companies are disadvantaged through government meddling, they will need to raise the prices of their gas to make up for it, or, most likely they will water-down the government meddling so it becomes as impotent as the mining tax and has no effect except for wasting millions of taxpayer dollars setting it all up.

    Apart from the government actually making an effort and doing some work, the only other way to fix the market is to abandon it completely and let it implode under the weight of its own greed.

    Fortunately the future is here! Solar and batteries is the enlightened path to remove yourself from the grip of these gouging private companies. Coupled with electric cars we can all achieve complete energy independence, right now, at this point in time, using current technology.

    The privately owned markets have, through the greed of their employees, made alternative energy viable, and its not like you need to take hit to living standards to switch over if you are real about it, in this country blessed with abundant sunlight.

    So even if you’re a CAGW agnostic such as myself, you must see the benefits of total energy independence. Release yourself from the grip of gouging private corporations filled with insatiable debt-laden individuals, today!

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