Australian LNG

Via the AFR: The UBS analysis comes just ahead of the introduction of the government’s controversial “domestic gas security mechanism”, which could cap LNG exports if it is triggered.

Via The Australian: The Turnbull government is ­preparing to back the construction of new coal power stations to prevent a dangerous shortfall in electricity supplies, using “reverse auctions” to replace ageing coal-fired generators with new technology already embraced in Japan and China.

Via The Australian: The Turnbull government has announced it will impose restrictions on Australia’s domestic gas supply in a bid to lower electricity prices.

Dalian is wandering aimlessly today: Big Iron is mostly up: Big Gas is burning: Big Gold is correcting: Big Bubble has had its run seemingly: Big Liar is soldiering on: And a bonus chart today, hope your enjoying Australian exceptionalism: If not, try the MB Fund launching July 1st with a 70% international equities allocation.

Oil bull Morgan Stanley capitulates today: The return of oil inventories to five-year average levels was characterised this week by the IEA as “the currency used to express re-balancing”.

We warned and warned and warned and now they are here: Around three quarters of the nation’s households and businesses are now facing substantial rises in their power bills from next month, after Origin Energy announced price hikes for electricity and gas.

Via the AFR: The east coast gas debacle has become a game with no winners, even with the Australian Domestic Gas Security Mechanism.

From Santos CEO Kevin Gallagher today on the domestic reservation mechanism: We believe there are better ways to manage this situation than government intervention that might expose the taxpayer to compensation payments while not delivering any public benefit.

Oil is getting caned: Let’s sum up.

The AFR has the scoop on today’s AEMO update: Australia is at risk of more blackouts next summer despite a raft of new initiatives from energy regulators and governments, according to the latest forecasts from the Australian Energy Market Operator.

Via the AFR: The chance of crude oil prices slumping to $US30-$US35 a barrel for several years, sending the global economy into crisis and multiple producers into bankruptcy, has emerged as a real threat, according to one of the world’s leading forecasters.

Don’t look for rationality here.

From Treasurer Morrison: Treasurer Scott Morrison has warned the federal government can’t continue with existing energy policy because it’s hurting families and the economy.

That seems to be the depth of reasoning overtaking the share market today as banks soar.

Via Citi:  Oil skeptics appear to be right and wrong in believing the OPEC/non-OPEC accord struck in late May will unravel due to a coming US production surge and a lack of compliance.

Via Mark Samter and the superb gas team at Credit Suisse: The month of June should, in theory, reveal plenty about the much-fabled (by us at least) East Coast gas market.

Dalian is moderately ill today: But it’s Costanza day on the market, “do the opposite”: Perhaps it’s this tripe from CBA: “Rising seaborne and domestic Chinese supply and muted restocking demand help explain the recent slump in iron ore prices,” he says.

Congratulations to all: Households across the eastern states are about to be hit directly by the closure of the giant Hazelwood power station in Victoria and soaring gas prices, with sharp hikes in retail electricity prices from July 1 coming on top of the hefty increases in recent years.

Dalian is soft today: Big Iron is down: FMG has broken to new lows.

Via Macquarie: One minister to rule them all  The Australian Government quietly released its draft policy regarding LNG export limits.