Gas cartel war-profiteeting breaks Australia

Well, that escalated quickly. This is how evil this cartel is:

An extraordinary spike in wholesale gas prices in Victoria to up to 50 times normal levels has prompted the Australian Energy Market Operator to intervene and impose a price cap in a widening of the fall-out since the failure of NSW gas retailer Weston Energy last week.

AEMO has capped prices over the past few days in the Sydney and Brisbane markets. On Monday, it imposed a price limit in Victoria after spot prices were set to soar to an incredible $382 a gigajoule.

…Textile makers and others have said they cannot continue operating at the high tariffs and will have to consider whether to close plants as they plead for government action to rein in prices.

…Josh Stabler, managing director of energy adviser Energy Edge, noted that three of the four east coat domestic gas markets were now being administered by the AEMO under imposed price caps.

Prices started to be controlled in both the Sydney and Brisbane markets last week, at about $28/GJ in Sydney, and at $40/GJ in Brisbane, Energy Edge said, based on rules triggered when Weston’s customers were transferred to “retailers of last resort”.

Then on Monday, Melbourne’s market broke the cumulative high threshold for prices allowed over a seven-day period under the energy market rules, causing its market price to also be capped at $40/GJ.

A ministerial direction in NSW issued on Monday would result in the cap on the Sydney price rising to $40/GJ as in the other states, Mr Stabler said.

…He said the intervention by AEMO meant prices that were due to reach $85/GJ in Melbourne on Tuesday and $382/GJ on Wednesday would “thankfully for the beleaguered energy markets” be capped at $40/GJ.

LNG exports from Queensland do not appear to be causing the squeeze, with east coast LNG exports declining this month. EnergyQuest consultant Graeme Bethune said LNG exports from Gladstone for May were 1.784 million tonnes up to May 30, down from 2.068 million tonnes in April.

The press needs to stop quoting Graeme Bethune. At no time in the past decade has he shown anything other than a complete bias towards the gas cartel.

It is beyond obvious that Australia’s east coast gas markets are so acutely and chronically short of gas that the market has now completely failed. The traditional gas price is $3Gj, 12,700% below.

This is war-profiteering by Australia’s east-coast gas cartel of Santos, Woodside, Origin, Exxon and Shell as the Ukraine conflict leaves the world scrambling for gas.

The inflationary implications of this for Australia are so apocalyptic that it’s not even worth calculating. This will destroy the economy and all asset prices while adding nothing to production.

The RBA needs to call Albo and tell him that it cannot possibly handle this crisis with the cash rate. It will annhilate the property market and banking system.

The Albanese Government needs to step in and pull the Australian Domestic Gas Reservation Mechanism (ADGSM) ripcord, as well as force all gas cartel executives back to the table to guarantee $7Gj rates permanently.

Albo needs to do something similar with coal which is playing a larger role in power price rises in NSW and QLD.

These energy prices are far beyond anything being paid anywhere else in the world which, ironically, import much of their fuel from us!

The gas cartel lied during its construction that it had enough gas for exports and is now war-profiteering so viciously that Australian national security is being trashed.

Break it.

Houses and Holes
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  1. China residents get their electricity for half the price of Australian customers using australian fuel.
    Makes you wonder if Aussies will go Sri Lankan on the corrupt elites at some point.
    Also Albo needs an albatross hat!

    • BadaBingMEMBER

      Victoria will need an LNG import terminal next winter. Regulators been warning for years, green submissions have been blocking the rather small ($250m) import hub projects. The consequences of limited NSW VIC gas development are going to be real. The gas has got to come from NW shelf or NE, which can come from ADGSM proposed by DLS. Manufacturers are best to relocate to WA in this green climate, but the labour costs are prohibitive given the Holes economy making bank.

      • Ronin8317MEMBER

        A LNG import terminal is simply ridiculous : Australia is a gas exporter!!

        • BadaBingMEMBER

          Australia is a big place. Cost up the price of a pipeline from QLD or WA to Victoria. Get that under $250m, and i’ll vote you in as PM. Get that pipeline built in 12months, and there’s a beer in it.
          (The LNG trains are presently operational)
          The suggestion is NOT to import, it is to RELOCATE ADGSM gas in the cheapest, fastest manner so that businesses and people don’t freeze.
          quote: “which can come from ADGSM proposed by DLS”
          Have another go.

          • BadaBingMEMBER

            DLS. Imagine your $7Gj is triggered. How do you get WA and QLD gas to Victoria?


            “AEMO has identified the low Dandenong LNG inventory as a threat to system security and is seeking a market
            response. AEMO is currently engaging with APA, market participants and the Victorian Government to assess the
            options available to mitigate this gas supply and safety risk.”

            The “import” terminal, is just an exchange hub to move the Domestic $7Gj from WA/QLD to VIC. The refrigeration is done at the LNG production… the “import terminal”, is quite literally a bunch of transfer tanks and regulating equpiment to match the ship-load of gas into the domestic grid. Not “import” in the financial trade sense….

            AEMO’s current plan is to piggy back Port Kembla’s “import” terminal and NSW pipeline.

            This is a domestic transfer problem. VIC gas is done, Santos has been scratching around for more for years… it’s done. See report. There aint no pipeline from QLD or WA to VIC.

            Love ya work. Hope you have a backup electric heater for next year.

          • BadaBingMEMBER

            Good you get the problem.
            “Proposed” pipelines are fun, but they don’t do much.
            Again $250M hub, 12months, existing LNG trains.
            I’m all for trans-national pipelines, but it’s uneconomic. If the greens block a straw coming from offshore ship, how do you think they’ll go with 1000’s of kms of pipelines traversing rare frog swamps?

            See report. AEMO intends to piggy back NSW’s straw.

            Generally the argument for a pipeline is to not add the cost of refrigeration…. but… we built those bits already didn’t we.

            One way or another, the gas will (in reality) come from import terminal. It’s just a question of what price we pay for it.

          • TheLambKingMEMBER

            Good you get the problem.
            “Proposed” pipelines are fun, but they don’t do much.
            Again $250M hub, 12months, existing LNG trains.

            So you really are trying to sell ice to Eskimos or oil to Saudi Arabia!
            You know the Victorian gas will go up the pipeline to the Queensland LNG plants, the gas will get liquified and put on a ship then sent back down to Victoria, de-liquified, and possibly put back into the same pipelines to send it to Vic households. With the gas cartel taking their clip along the way and creating HUGE greenhouse gasses in the process.

            In no sane world (i.e a rational & free economic market) does a gas import terminal make economic sense in a country that is the largest exporter of gas in the world (and it makes even less environmental sense).

            Victoria should go all-in on shutting down all gas usage before thinking about an import terminal.
            – Ban all gas connections on new builds.
            – Ban the sale of all gas heaters, hot water systems & cooking appliances.
            – Implement a rebate/subsidy/trade-in for replacement of heating/hot water/cooking appliances.
            – Reserve 10% of Victorian gas for Victorian use.

          • I support Houses and Holes.
            $250 million is cheap for value. Time we built properly in our country.
            It is an investment, we have our own gas and coal.
            Greens are in a political fantasy world, don’t know anything about biology or global or solar cycles but sure they have power.

    • Yes it’s appalling. Other gas coal and oil producers give product to their domestic markets first and at sane price. I consider we should get cost-plus pricing.. To get Aus industry of all sorts, primary, hard and soft going or recovering we need fair cost energy and that means low cost after the battering we have had by scum. And that means govt intervention, not bothering to think how, but it’s time if this govt gives a thought to our sovereignty, we get our energy first and cost-plus and we get our people and economy able to function first. Same as with homes and education.

      Right now I am revelling in a cute two bar goldair radiator @ 49$ after my gas hydrodronic heating was turned off when a gas man was working…no one knows how to get it going, was about to phone the gas company when I read this, but looks like I wear thermals and feel healthy in a chilly home.

  2. Excellent, as long as it doesn’t affect property directly then 99% of people don’t give a F.

    Sure there are second and third order consequences of these price rises but if we really want to see the housing market blow up can you stop shedding light.

    Let it all culminate in higher interest rates and disgustingly high energy prices to blow the property economy.

  3. Similar to this in the UK is coming…….the gov. has to ensure that small business gets operating capital from the banks while rising interest rates do their thing, but the asset their business is pledged against is falling…….otherwise credit crunch and this is not the early 60’s…….most people are used to credit on demand now. ( Now you think about it the wool boom was caused by the Korean War as well.

    • wtf?!? …
      … wtf?!? is a ‘small business’???
      those don’t really exist anymore. nor can they if they do.

  4. Labor gonna be shafted before they even start! LOLs
    And all because they have been bullied in the past by Rupert & are now scared to do anything.
    Do nothing & they’ll be a one term gov anyhow. Then it really will be all Labors fault.
    (This is a good excuse for Albo to go back on what he said a few days ago.)

    • bolstroodMEMBER

      Albo will need to retrace quite a bit of what he said before and during the campaign, starting with the 3rd tranche of tax cuts to the rich, revisiting changes to capital gains tax, franking credits refunds to people who don’t pay franking credits, to name a few.

      • UpperWestsideMEMBER

        Refunding unused franking credits is just plain wrong
        I know it buys votes from old buggers
        But it is still wrong.

    • It is the LNPs fault, crap economic managers, just say it three times a day and you will believe it.

    • Labor has Clare O’Neill who is a valued young leader of Klaus Schwab of World Economic Forum a corporate entity working on humans as hackable animals, monitored internally via chips, no more free will.

      All under the governing elites one world govt, and on a much reduced population according to Phizer CEO who spoke last week at Davos, looks like we get the 50% reduction in world pop by 2023 that we gamed in 2019 he breezed happily to them all.

      With Scomo, Dan Andrews, Clare and who knows else Aus working as agents of the foreign company WEF we can expect some suffering if they get their way, Putin told them late last year all at Davos they had failed, won’t get a one govt ruling the planet so they have reason to hate him some more. He keeps increasing export volumes of non gmo healthy grain and increased it to cover less exported from Ukr this year. Less deaths if it gets thru the sanctions.

    • Food security should be top priority. The Hunga Tonga VEI 6 eruption is the largest since 1912. Instead of injecting SO2 it has instead injected a massive amount of water vapour into the stratosphere. This is unprecedented, and no one knows the consequences. To hazard a guess, we are in for some disturbed weather patterns. To add to the situation we are looking at back to back -ve IOD. Great for Australia, catastrophic for the horn of Africa (1980s eathiopian famine)

    • Any food security crisis from action in Ukraine is due to sanctions put on by consenting EU Japan and anglosphere govts. Not from the war itself.
      Russian has increased its export volumes 18% of clean non GMO grain which compensates for the 30% drop in Ukr export this year. Scomo put on 460 or whatever number of sanctions which only hurt us, make our country a fool and be seen as such.

      Apart from sanctions on transport ships and sanctions, problems have been the AZOV Nazis 1200 water mines set underwater around all the Ukraine ports in the Black Sea and AZOV Sea. Some have broken free and in the Black Sea down to Turkey.
      Since AZOV nazis and Ukr army snipers and worse have been defeated, Russia very rapidly has cleared the Nazis 12000 explosive devices from Mariupol port including in the sea with divers. And dealt with the cranes and ships bombed and sunk by the AZOV nazis to block the port, trapping many foreign ships and crew for months in the port.

    • Re shoes and leather goods is an issue painfully close to my heart. Our wise govt took tariffs off imports of smelly, badly made, inferior leather goods to Aust in the 1990s.
      That ended our world first skin production, we had best skins, best tanneries, and big volume of top class goods efficiently manufactured. Humanely sourced or farmed. And we had 13 double doctorate hides skins and tannery CSIRO experts who lost their jobs and were baristas in Lyon street and such desperate work to support late families and kids education.
      Since then the 3000$ handbag yellow crocodile bought at David Jones started stinking after 6 months from tanning because tanning rotting skins only briefly covers the smell then the rotting continues. Most handbags stank the buyers did not know how leather was meant to smell. I am a shoe lover and it’s been desperate times, I still think of the exquisite shoes of my youth.

      You got your wish then Jacob, cheap shit leather, dreadful poor quality shoes imported, and you were happy Jacob until now.
      In my opinion, we need our sovereignty back, our leather, our tanneries, our CSIRO refunded, refunded the 40 years of cutbacks, and the double doctoral tanning experts back where they are meant to be. Our own bags, shoes and whatever’s all again. The alternative is by the collapse of the west in 2032 we sink into dire poverty. Not even third world.

    • Re soap, Jacob, then we might make our own again. We had manufacturing businesses we need them again, That means a reliable govt owned bank like a Post Office Bank, which lends to small business with govt guaranteed deposits for its employees and rest of us, and reaching all regional areas which the banks do not serve. Soap making is not rocket science,
      There is a thriving alternative scene in soap making, if you are in a city the markets will have locally made soap. It can be made at home, many women do and there are local videos on the net for better than boughten.

  5. I just don’t understand, if Albo pulls the lever and spin it, he will have the approval tick he needs (because that’s all they care about), just bloody do it ffs.

    I just had a convo with a mate who works at AGL as he was trying to trash MCB’s plan. Advised him that if Albo pulls the Domestic Reserve Trigger there is no price increase when we transition to renewables, gas was always going to be what helps us transition.