Biden's Energy Policy delivers record high exports of gas (LNG)

Bidenomics rocks.

 

Giving credit where credit is due, Vladimir Putin's decision to invade Ukraine along with his attempt to use Russian gas as leverage was also a factor in increasing the demand for US LNG.

 

This is good news. I approve.

Now I wish he’d do something about the rising cost of gasoline. I just saw $3.79. Ouch

 

Why is $3.79 a problem though? How do you know that’s not where gas prices “should” be?

I think the evidence is the economy operates just fine even with $4 gas. In the early 2000’s $4 was the point we saw economic destruction from gas prices. Now it’s probably more like $5 or even $6 before that’s a real issue. Anything with a 4 handle is maybe where it starts getting bad for political scorekeeper types, but it’s just fine economically, and may even be a good thing as far as causing people to rethink some life choices.

 

It was the biggest factor by far. Flip side is it is helping fuel inflation by raising the price of electricity and the feedstock for lots of plastics

 

Well you got your wish.

$399.9 today for regular at the local Shell.

This doesn’t affect me at all as I can afford it. Lots of people struggling to pay rent, buy food, and get to work will suffer.

You go Joe, your fans love it.

 

$399 gas? Maybe I will vote for Trump

 

Please don’t.

Asking for a friend

 

Nat gas is often a by product of oil production and there was so much it is cheaper to flare it off than process and pipe it. Not sure that we started producing that much more or just flaring less or maybe some of each

 

Not sure where gas prices “should be” but I liked where they were when Trump was in office a whole better than where they’ve been the first two-plus years under Biden. The fact is the average price per gallon of gas likely will finish higher under Biden (currently $3.60) than under any other president in history (and by comparison the average for the four years under Trump was $2.57).

 

You think Presidents control gas prices? Other than lame games with the SPR, there is very little input.

We are in an odd time, very little has been “normal” in the energy markets since the early 2000’s. We went from “peak oil theory” to the Great Recession practically overnight during the 2nd term of the Bush admin, which saw gas go from $4.00 to under $2.00 in the blink of an eye. Obama’s time saw gas recover to near $4, before the fracking breakthrough saw us gradually have an overabundance of oil and gas which saw prices collapse once again in ‘14 and ‘15. This technical breakthrough, which has nothing to do with any policy, is what kept prices low for a few years through the end of Obama’s term and in Trumps term (and then the Pandemic disrupted it all even further in Trumps last year). None of that was normal.

Now that the economy is at full speed again (and demand got ahead of supply in numerous economic sectors), we are seeing a period where the oil and gas industry is choking off refining capacity, supposedly in an effort to match a plateauing demand (electric vehicles), but let’s not kid ourselves - some of those refinery decisions are probably to try and pad prices. But as I said, not necessarily a bad thing as higher gas prices helps the shift to electric vehicles, which would reduce the demand for refined gasoline, thus putting a permanent negative pressure back on prices. Normally the outcome would just be less economic activity, but we could also see different market choices.

 

While overall this is good news for the US economy, it will probably lead to higher natural gas prices in the US. Previously exports of LNG were greatly restricted, and the abundant supply of fracked natural gas stayed in the US, resulting in very low natural gas prices (and billions of dollars of losses in the fracking sector ). Now that exports are being allowed and infrastructure expanded, which has been greatly accelerated by the Ukraine war, natural gas will become more of a global commodity like oil, which will result in higher prices, but a lot more profitable energy companies, and a greater incentive to drill more with higher more profitable prices.


LNG exports may spell trouble on horizon for U.S. consumers

 

We don’t really use LNG here much. Its main use is a way to export natural gas.

Previously we produced a ton of natural gas, but were restricted via govt regulation on exporting it, and didn’t have much of LNG export infrastructure. So most natural gas stayed in the US.

Now that we have loosened regulations and increased LNG infrastructure more of it will be exported and natural gas will become more of a global commodity. All else equal that will probably lead to higher prices here, although it could also lead to more gas production which would offset the higher prices.

On balance it is good for the US economy but not necessarily US consumers.

 

and now Biden admin must decide whether to permit a massive LNG facility to help meet European demand. CP is jsut one of 17 facilities currently seeking permits to export the massive volumes of nat gas in the shale in the US.

The additional export will drive lots of additional drilling in the marcellus in WV, Ohio, Pennsylvania and in Texas, New Mexico, Arkansas, not sure what it will do to the price of domestic gas. Permitting should be tied to additional methane monitoring and reduction efforts and flaring restrictions. Mobile data centers can be set up to use that flared gas to operate.

CP2 Natural Gas Project Is Biden’s Next Big Climate Test (msn.com)

The exports have given Washington new leverage on the world stage, allowing the Biden administration to impose sanctions on a new Russian Arctic gas project without threatening to raise global energy prices and to help power Europe as it weans itself from Russian gas.

Proponents of CP2 are quick to point out its strategic benefits. In a letter to American regulators urging the approval of the project, a state-owned German gas company said the proposed facility was “vital for Germany’s energy security in the new environment, where gas pipeline supplies from Russia have stopped.”
They warn that an escalation of hostilities in the Middle East could threaten transit through the Strait of Hormuz, the only sea passage from the Persian Gulf to the open ocean, where nearly a quarter of the global natural gas supplies flow, making such projects all the more important.
............................................
But while natural gas burns cleaner than coal, methane emissions are 80 times more powerful than carbon dioxide over the first 20 years in the atmosphere. And although methane dissipates more rapidly than other greenhouse gases, it can leak anywhere along the supply chain, from the production wellhead to processing plants to the stovetop. The process of liquefying gas to make it suitable for transport is incredibly energy intensive as well, creating yet more emissions.

A new analysis by Robert Howarth, a professor of ecology and environmental biology at Cornell, concluded that the emissions associated with exporting natural gas could be 24 percent to 274 percent greater than those associated with burning coal. Citing that study, which has not yet been published in a scientific journal, some activists claim that approving CP2 would result in emissions 20 times greater than those associated with the Willow project, a major new oil drilling development in Alaska that the Biden administration approved this year despite an outcry from environmentalists.

 

I’m starting to see how this works. Get a war started between Russia and an Eastern European country, then take credit for boosting LNG output so Europe doesn’t freeze to death. Great concept.


City, are you a Cherry farmer? You sure are damn good at cherry picking bits and pieces of world events to fit your narrative.