Receive free Oil and Gas exchanges
We will send it to you myFT Daily Digest email lists the latest articles on Oil & Gas every morning.
The gas crisis in the UK and Europe is set to intensify after China ordered state-owned companies to access electricity under any circumstances.
Chinese media quoted Prime Minister Li Keqiang on Thursday as saying that the country will regain its power and electricity following a power outage and a shortage that has forced many companies to ban emissions.
Bloomberg also said at the end of the day that government officials had instructed state-owned companies to meet their current needs on a regular basis, and said the advice came from Han Zheng, the country’s deputy prime minister who oversees the country’s electricity sector.
China’s move suggests that some parts of the world will face a difficult time finding essential oils.
Prices for natural oil in the UK and continents in Europe have been rising sharply in recent weeks in anticipation of a slowdown in winter production, with Asia demanding more oil for major commodities.
Prices of natural oil (LNG), which are highly competitive between Europe and Asia in the gas sector, reached Thursday in Asia with $ 34.47 million in British Thermal units where consumers struggled to ship, while China gained power over the age-related problems due to low coal.
The program of a significant increase in the price of LNG this year has raised gas prices in the UK and Europe as the continent tries to attract supplies, but in the meantime Asian buyers are willing to continue paying to close prices. This has led to the emergence of a war of attrition between the two regions, which could increase prices even further.
“It seems that the demand for gas is not a concern even at very high prices – in all markets,” said Laurent Ruseckas at IHS Markit, a consultant.
European oil prices met again on Thursday, when the deal reached $ 97.50 per megawatt hour, before slightly lowering. In the UK, futures prices jumped more than 25% to $ 2.30 million per therm. It sold about 40p and therm in February.
The program of difficulties in the oil market in Europe they have been drinking for a while. Long-term storage at home, then a shortage of LNG stocks this summer has meant that stocks have not been built at the level that the market might want. Russia’s low pipeline output and a slight drop in domestic production have increased fears in the winter.
China is facing problems due to a reduction in coal-fired power generation, which is leading to faster gas purchases faster than European traders expect.
Rising oil prices around the world have passed the high cost of electricity and pushing for rising electricity prices politically, fearing that the cold weather could squeeze things to the point where other energy-intensive industries need to stop production.
Rental oil prices have caused the collapse of 10 electricity suppliers in the UK and prompted the government to do so. intervention support a fertilizer company that was one of the country’s largest CO2 suppliers, which are essential for food packaging, medical care, and nuclear power plants.
This letter twice a week
Energy is the most important business in the world and Source Source is his story. Every Tuesday and Thursday, directly in your email, Energy Source brings you important news, future analysis and in-depth insight. Sign in here.
China has been struggling to improve domestic coal to meet the demand for electricity when its economy resumed after the epidemic due to new security measures introduced after several deadly accidents.
In the Chinese housing market, coal trades at Rmb1,700, or $ 263 tonne on Thursday, according to Argus Media, a pricing agency. European prices, meanwhile, have risen to more than $ 200 per tonne – the last level seen in 2008.
China’s energy has grown by about 15% this year, according to Morgan Stanley but domestic glass is only about 5% a year. Coal is still China’s largest energy source.
Colin Hamilton, an expert at BMO Capital Markets, said: “Buying gas in China is a testament to the existence of an alternative coal-fired power plant.”