Don’t worry, Josh Frydenberg will pr0tect you and your kids:
Treasurer Josh Frydenberg has agreed with a pessimistic assessment by the White House that Australia should settle in “for the long haul” of “harshness” from Xi Jinping’s China.
The deputy Liberal leader said Beijing’s assertive approach had influenced his decision making on investment proposals by Chinese companies.
“We are living with a different China,” Mr Frydenberg said when asked about a frank appraisal of Australia’s strategic dilemma by the US’s Indo-Pacific co-ordinator Kurt Campbell.
Yes, we are. So, why are we doing this?
Manufacturers are sounding the alarm as east coast gas prices surge to levels not seen since 2016, thanks to cold winter weather and gas having to be diverted to generate electricity after the breakdown of coal-fired generators.
The spike in domestic gas to as much as $10 a gigajoule above export prices has triggered renewed calls from industrial gas users for the federal government to step in and redirect exported gas from Queensland to force prices lower.
Energy Users Association of Australia chief executive Andrew Richards said there were growing fears the market was heading back to the worst days of the east coast gas crisis.
China is today buying Aussie LNG on contract for about $11Gj. Australians, on the other hand, are paying $20-30Gj in spot markets for the same gas that is dug up down the road:
The reason is very simple. Since 2014, when east coast gas exports began in earnest, we have seen local price spikes again and again when offshore prices rise.
Gas supplies in Asia are tight and prices rising, via the ACCC:
Because the Morrison government is run by the Australian gas export cartel, that entity has the market power to shove these Asian price rises (plus a huge added premium) down the throats of Aussie consumers of gas, even though it’s our gas and it’s cheap as chips to extract.
To prevent this, what is required is to install a domestic reservation regime that breaks the nexus between regional prices and local. As is done very successfully in WA. But that obvious and easy solution has been constantly overlooked in preference to the “gas-led recovery” of more gas (which is code for doing nothing at all).
In consequence, for over five years now, Australian households have been directly subsidising gas consumers in Asia. At first, this was largely in Japan which took Australia’s cheapest gas while locals were force fed the expensive stuff.
This we already know. What is new, or at least increasingly the case, is that Australians are doing the same for Chinese gas consumers on a massive scale. Last year, Japan was still our top LNG export customer at 30.3mt. But only just as China roared higher to 29.6mt. This year it will very likely surpass Japan.
Moreover, the east coast is supplying the vast bulk of the gas exports to China:
Meaning that Chinese exports are directly responsible for massive east coast gas bills (and soon electricity as well), even as it openly conducts a trade and psy-ops war upon Australia.
If that isn’t bad enough, cop this:
“The price is being paid by industry,” he said, estimating that almost one-third of industrial gas customers pay roughly the spot price for the fuel.
Mr Richards said that while most manufacturers attempted to hedge prices through longer-term contracts, the days of three or five-year contracts for gas were over.
“A long-term contract is two years now. A lot of people I know are on two-year deals and if it rolls into a period of $18 per gigajoule they could be at the mercy of that,” he said.
It’s bad enough that we ship the CCP iron ore that it uses to build weapons that threaten our freedoms. It is quite another to send it gas to make weapons while destroying our own capability to do so.
When Bob Katter becomes the voice of reason in Canberra, you know the place has gone stark raving mad:
Mr Katter suggested there should be a gas reservation policy on domestic coal and gas, which would result in the resources being made available for industry “at next to no cost”.
As China develops into Australia’s existential enemy, basic national interest policymaking is the difference between life and death of our liberal system.
