AFR’s gas cartel war on Australia continues

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The entire east coast is now enjoying a still high but much-improved gas price of $11Gj today as the export cartel goes the raw prawn with the political economy.

Power prices have dubifully corrected:

Meanwhile, the AFR continues its cartel propaganda war against Australia:

Returns over the life of Santos’ GLNG project in Queensland look set to average just 5 per cent a year, less than half the targeted amount, according to MST Marquee, in contrast to claims that gas exporters in Gladstone are raking in windfall profits.

Far from making super profits, Queensland’s three LNG export projects are now making earnings that only help offset previous losses and write-downs, energy analysts have calculated.

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Yada, yada, yada. The writedowns derive from the original over-investment. They are not a virtue to be claimed just because there’s war in Ukraine.

The export cartel is making super-profits based upon war-profiteering to which they have no conceivable right. Including the excuse that they should never have invested so much, so poorly in the first place.

This is the policy equivalent of arguing that adding a catastrophic wrong to a calamitous wrong makes a right!

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Put a $7Gj trigger into domestic reservation NOW and let the market sort out the rest.

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.