U.S. Economic Officials Says Biden Considering Oil & Tax Windfall Tax
A White House economic advisor told a panel on Thursday that the Biden administration is now considering the U.S. congressional proposal that would place a windfall tax on oil and gas as prices at the pumps continue to soar, “We are very much open to any proposal that would provide relief to consumers at the pump,” National Economic Council deputy director Bharat Ramamurti told a Roosevelt Institute panel, as cited by Reuters. Ramamurti said the White House was “engaging in conversations” with Congress about a windfall tax, noting there was a “variety of interesting proposals”. The National Economic Council official also noted a potential impact on supply if a windfall tax were imposed, though he said he did not see this as an “insurmountable hurdle”, Reuters reported. Ramamurti’s comments came just a day after the National Economic Council deputy director told reporters that Biden’s plan to combat inflation included lowering the budget in part by raising taxes on America’s wealthiest and the country’s big businesses. “What the president has done and made clear is that we are dedicated to doing everything we can to stop and push back on that Russian aggression, but it’s going to cause pain for American consumers in the short term, and gas prices are one unfortunate example,” Ramamurti told local media. On Thursday, the national average for a gallon of gasoline in the United States hit $4.715, up from $4.671 on Wednesday, according to AAA. Brent crude was trading at nearly $118 and WTI at $117. Talk of a potential windfall tax in the United States follows a move by Hungary to impose taxes on extra profits for large companies across industries, in order to subsidize consumer energy bills and defense. It also follows an announcement on May 26 that the UK would implement a windfall tax on energy first in the North Sea.
ADNOC acquires three additional new-build LNG vessels
ADNOC Logistics and Services, also known as ADNOC L&S, has decided to purchase three additional newly built liquefied natural gas vessels, as it plans to respond to the growing demand, according to news agency WAM. Each of these vessels will have a capacity of 175,000 cubic meters, and they will have additional capacity when compared to the firm’s current fleet which have a capacity of 137,000 cubic meters. Earlier, in April, the Abu Dhabi-based business had announced that it will purchase two LNG vessels, which brings the total number of LNG vessels ordered to five. These vessels are scheduled for delivery in 2025 and 2026. “Our company is an active player in the evolving global energy landscape, where natural gas and LNG are playing an increasingly important role. Our strategic acquisition of five state-of-the-art LNG vessels will support our existing LNG business as well as its significant growth plans,” said Abdulkareem Al-Masabi, CEO of ADNOC L&S.
Pipelines being laid for gas distribution
Laying of pipelines for gas distribution in Ramanathapuram and Keelakarai has begun and experts from the AG & P Pratham have launched 3 CNG (compressed natural gas) stations here. According to a press release issued here on Thursday, the company has proposed to supply 24×7 natural gas here by establishing gas grids in Pattinamkattan and Rameswaram, which would help achieve 15000 PNG (piped natural gas) registrations by March 2023. The work has started from the CGS plant at Valuthoor to Kumariyakovil. It would provide continuous CNG/PNG supply to domestic customers and company owned and company operated gas filling station to come up at Kuyavankudi. With regard to Ramanathapuram, the Regional Head E Poomari said that the CNG supply would reduce the expenditure at least by 50 % on the household expenditure. The project is safe, secure and help have a cleaner environment. The company has been authorised to develop CGD networks in six districts including Vellore, Ranipet, Tirupattur, Ramanathapuram, Kancheepuram and Chengalpattu. By December, they aimed to achieve around 10000 domestic registrations for PNG and 7 CNG stations in the region. The Petroleum Explosives Safety Organisation had issued licence for the steel pipeline work in Ramanathapuram and after laying work, the land would be restored to its original condition after the groundwork.
Asia LNG Prices Rise as Japan, Korea, India Boost Stocks
Asian spot liquefied natural gas (LNG) prices rose this week on as Japan, South Korea and India sought to replenish their stocks. The increased competition has accordingly narrowed the spread with European gas prices, which eased on less concerns over further Russian supply cuts. The average LNG price for July delivery into northeast Asia was estimated at $24.75 per metric million British thermal units (mmBtu), up $1.35 or 5.8% from the previous week, industry sources said. “The market has been a little more stable recently compared with the volatility of earlier months, although still at high prices,” Alex Froley, an LNG analyst at data intelligence firm ICIS said. In China, market players are waiting to see if Covid-19 lockdown easing will help demand. China LNG Imports Down China’s LNG imports until end-May were down by 6.5 million tonnes, or 20% from the previous year, equalling some 9 billion cubic metres of pipeline gas, Froley noted. Major purchases by large South Korean and Japanese utilities have occurred in the meantime, according to S&P Global Commodity Insights. LNG freight spot rates continued to rise as vessel availability tightens, with Pacific rates estimated at $85,000 per day and the Atlantic rates at $96,500 per day, according to Spark Commodities. Australia’s trade surplus widened more than expected in April thanks to rising exports of LNG as well as a return of tourists. The US exported 7.29 million tonnes of LNG last month, the second highest quantity on record, though virtually all were sales to Europe and South America, according to Refinitiv Eikon data. Separately, the Japanese government said it would not exit the Sakhalin 2 LNG project in Russia even if asked to leave. Land for the project belongs to Russia, but the plant is owned by the Japanese government and companies, Koichi Hagiuda, the Minister for the Economy, Trade and Industry, told a parliamentary committee.