Lo and behold: Gas reservation lowers prices

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Hoocoodanode! Via the AFR:

Taylor clearly believes in adding more political pressure – given his insistence that prices must come down a lot further.

That includes potentially toughening the Australian Domestic Gas Security Mechanism established two years ago to ensure no shortfall in the domestic market due to the export of LNG from Queensland. The threat has had some effect. The Queensland LNG players are fulfilling their offshore contracts, mainly to Japanese customers. But rather than using domestic gas to supplement exports, they now send any extra production south rather than to the international spot market.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.