2024-08-26 12:00

LAUNCESTON, Australia, Aug 26 (Reuters) - The spot price of liquefied natural gas (LNG) in Asia eased last week amid signs that seasonal demand may be peaking and the five-month rally is trimming purchases by price-sensitive buyers. The price of spot LNG for delivery to North Asia dropped to $13.80 per million British thermal units (mmBtu) in the week to Aug. 23, a decline of 2.1% from the eight-month high of $14.10 the prior week. It was also the first time the benchmark price had fallen in four weeks, although it is still 66.3% above the low so far this year of $8.30 per mmBtu hit at the beginning of March. Asian LNG prices have been driven higher by strong demand from heavyweight buyers such as China and Japan, amid a warmer-than-usual northern summer that has stoked power demand for air-conditioning. Asia's imports of the super-chilled fuel are on track to reach a seven-month high of 25.03 million metric tons in August, according to data compiled by commodity analysts Kpler. This is up from 23.86 million tons in July, and also above the 23.32 million in August last year. Much of the increase has been driven by China, the world's biggest LNG importer, with its August arrivals estimated at 6.94 million tons, the most since January and up from July's 5.91 million. While China has seen rising power demand because of hot weather, only small volumes of LNG are used to generate electricity, the bulk being supplied by coal, renewables and nuclear. Rather it's China's increasing use of LNG in trucking that is driving consumption, with consultants Wood Mackenzie saying in a report last month that LNG truck sales "rose from below 10%to reach as much as 30% of the market in the latter months of 2023". LNG demand in Japan, the world's No. 2 importer, is being driven by more traditional factors such as increased air-conditioning use. Japan's imports are estimated at 5.83 million tons in August, a five-month high and up from 5.45 million in July. South Korea, the third-biggest LNG importer, shows a similar pattern, with August arrivals of 3.86 million tons being the most since April and up from 3.16 million in July. INDIA, THAILAND However, looking at the more price-sensitive Asian buyers reveals a different pattern, with India, the region's fourth-biggest importer, forecast to have arrivals of 2.09 million tons in August, the lowest since April and down 18% from July's 2.56 million. Thailand's August LNG imports dropped below 1 million tons for the first time since April, with Kpler estimating arrivals of 880,000 tons, down from 1.04 million in July. It's likely that higher prices have curbed imports by India and Thailand, with market sources indicating utilities in both countries have failed to award spot tenders in recent weeks. This suggests that spot prices may have to ease further in order to tempt buyers in South and Southeast Asia back into the market. It's also likely that demand in North Asia may return to its normal seasonal pattern, which typically sees a peak in summer, usually August, followed by declining imports until October before arrivals kick up again to meet winter demand. A further factor that may see Asian spot LNG prices ease is the ongoing weakness in demand in Europe. The second-biggest importing continent is on track to import 6.25 million tons in August, the lowest monthly total in three years, and down from 6.52 million in July and 8.58 million in August last year. LNG demand is slipping as the European Union's natural gas inventories reached 90% of target last week, which is 10 weeks ahead of the target set by Gas Infrastructure Europe. It's also likely that Europe's natural gas demand has shifted structurally lower since the continent was forced to cut reliance on pipeline supplies from Russia in the wake of Moscow's February 2022 invasion of Ukraine. The opinions expressed here are those of the author, a columnist for Reuters. Sign up here. https://www.reuters.com/business/energy/asia-spot-lng-price-slips-demand-peaks-prior-rally-bites-russell-2024-08-26/

2024-08-26 11:48

SINGAPORE, Aug 26 (Reuters) - The United States imposed sanctions on over 400 entities and individuals for supporting Russia's war effort in Ukraine, the State Department said on Friday, including companies supporting the development of Russia's Arctic LNG 2 project and its shipment of liquefied natural gas (LNG), as well as other future energy projects. The Arctic LNG 2 project by Russia's Novatek (NVTK.MM) , opens new tab is subject to Western sanctions over Russia's conflict with Ukraine. The project had been due to become Russia's largest LNG plant with eventual output of 19.8 million metric tons per year of LNG from three trains. Novatek may be forced to scale back the project following the sanctions, but a tanker under U.S. sanctions that picked up a cargo from Arctic LNG 2 has been found to be carrying out a ship-to-ship transfer, suggesting Moscow is managing to continue some exports from the project. Below are the companies designated by the U.S. state department, as well as the vessels they own or manage, according to data from Equasis and Kpler: SHIPPING COMPANIES THAT LOADED AND TRANSPORTED LNG FROM ARCTIC LNG 2: The U.S. state department said the Pioneer and Asya Energy vessels had entered Russian waters in late July, and had shut off and manipulated their automatic identification system (AIS) to broadcast false locations. While producing a false AIS signature, Pioneer and Asya Energy loaded LNG from the Arctic LNG 2 facility on Aug. 1-3 and 9-11 respectively, said the state department, citing commercial satellite imagery. Ocean Speedstar Solutions and Zara Shipholding did not immediately respond to a request for comment. TARGETING RUSSIA'S PROCUREMENT OF LNG TANKERS: The four vessels have transshipped LNG from Russia's Yamal LNG project despite being originally intended for Arctic LNG 2 use, said the U.S. state department, adding that it is committed to blocking the expansion of Russia's existing LNG fleet. "Further, this transshipment of LNG by vessels with obfuscated ownership could eventually help Russia circumvent EU restrictions prohibiting the transshipment of Russian-origin LNG through European ports," it said. Reuters could not find contact information for White Fox Ship Management. TARGETING ADDITIONAL COMPANIES RELATED TO ARCTIC LNG 2: The state department also targeted Novatek China Holdings Co Ltd, a China-based firm established in August 2023 to market LNG from Arctic LNG 2. It also designated Russian construction firm Limited Liability Company Ekropromstroy used as a special purpose vehicle to sell equity stakes in Arctic LNG 2, and UAE-based Waterfall Engineering that provided parts to Arctic LNG 2 in 2023. TARGETING THE YAKUTIA LNG PROJECT: The U.S. in addition designated several Russian-based companies involved in the development of the future Yakutia LNG project, one of the largest prospective LNG production projects in Russia. They include LLC Power of Yakutia, LLC Yakutstroiproekt and LLC Liquefied Natural Gas Yakutia. Sign up here. https://www.reuters.com/markets/commodities/lng-entities-under-us-sanctions-curb-russias-arctic-lng-2-project-2024-08-26/

2024-08-26 11:34

Aug 26 (Reuters) - Canada is set to impose new tariffs on Chinese-made electric vehicles, aluminum and steel, Bloomberg News reported on Monday, citing people familiar with the matter. The government plans to announce a 100% levy on Chinese-made electric cars and 25% on steel and aluminum, the report said. Sign up here. https://www.reuters.com/markets/commodities/canada-impose-new-tariffs-china-made-evs-steel-bloomberg-news-reports-2024-08-26/

2024-08-26 10:51

ACCRA, Aug 26 (Reuters) - The two main contenders in Ghana's presidential election have launched duelling manifestos promising fiscal stability, jobs and a path out of the country's worst economic downturn in a generation. Voters will head to the polls on Dec. 7 to elect a successor to President Nana Akufo-Addo, who is stepping down at the end of the two terms he is allowed to serve as head of the West African gold, oil and cocoa-producing nation. The election will pit ex-president John Dramani Mahama of the main opposition National Democratic Congress party against Vice President Mahamudu Bawumia, an economist and former central banker, from Akufo-Addo's ruling New Patriotic Party. No party has ever won more than two consecutive terms in government in Ghana's democratic history. Frustrations about economic hardship have tainted Akufo-Addo's presidency. Ghana defaulted on most of its $30 billion external debt in 2022 - the culmination of years of overstretched borrowing compounded by the COVID pandemic, the knock-on impacts of the war in Ukraine and a rise in global interest rates. The government sought help from the International Monetary Fund and is now restructuring its debt as a condition for a $3 billion support package. Both Mahama and Bawumia laid out their policy promises over the weekend ahead of a vote analysts predict to be tight two-man contest, even though others are running. Mahama, 65, vowed to scrap first-year university fees to boost tertiary education and reduce taxes during his first three months in office. "I will lead a ruthless war against corruption" and recover misappropriated assets, he told supporters in the south central city of Winneba on Saturday. Mahama invested heavily in infrastructure during his 2013-17 presidency but drew criticism over power shortages, economic instability and alleged state corruption. He was never directly accused of wrongdoing but oversaw the government that was. His government denied wrongdoing. NPP critics say graft continued and grew worse under Akufo-Addo's administration. His administration has also denied wrongdoing. Bawumia promised to simplify the tax system, almost halve the number of ministers and cut public spending by 3% of GDP. Addressing reporters in the capital Accra on Sunday, he outlined a plan to provide digital training to one million young people to help them find jobs. Both candidates are from northern Ghana, a long-standing NDC stronghold in which the NPP has made inroads over the past years. Sign up here. https://www.reuters.com/world/africa/ghana-presidential-contenders-promise-ease-hardship-campaign-ramps-up-2024-08-26/

2024-08-26 10:46

JAKARTA, Aug 26 (Reuters) - Indonesia president-elect Prabowo Subianto hopes to implement mandatory 50% palm oil-based biodiesel blending by early next year, which he said would cut fuel imports by $20 billion per year. Indonesia said last week it planned to raise the blending to 40% in January 2025, from 35% now, in an effort to reduce fuel imports and lower emission from fossil fuels. Prabowo takes over in October from incumbent Joko Widodo, whose administration has ordered the palm oil industry to prepare for B50, a 50% blend. Tests have already started on the higher blending preparation. "We are at B35 now and we will accelerate to B40, B50," Prabowo said late on Saturday. "With B50, 50% biodiesel made of palm oil, once we reach B50, that God willing by end of this year or early next year, we will save $20 billion a year, we do not need to send this money overseas." Malaysia's benchmark palm oil futures surged and hit its highest in more than a month on the news, before it retreated and settled at 3,921 ringgit ($902.42) a metric ton, a 1.4% gain. Indonesia's biggest palm oil producers association GAPKI said B50 cannot be implemented in early 2025, as it has not been tested, GAPKI chairman said on Monday. Indonesia biofuel producer association APROBI said producers would need time to tests the B50 fuel and increase their production capacity to meet the demand, the group secretary general said. The biodiesel industry may need to improve quality of its products to ensure the fuel will remain stable for higher mandatory blending, said Tatang Hernas Soerawidjaja, a biofuel expert at Bandung Institute of Technology. Biodiesel is susceptible to forming sediment when in contact with oxygen, especially during transportation and storage, which could clog engine filters, he said. "Some biodiesel producers may need to install new equipment to meet the new standard, and this would take six months. After that, the commercialisation tests which not only test the fuel on vehicles but also storage tests, which need six months," Tatang said. "It would be wise to implement it by end of 2025 at the earliest," he added. B50 will consume an estimated 18 million metric tons of crude palm oil, up from the estimated 11 million used for B35 this year, GAPKI said previously. Indonesia's palm oil consumption has grown 7.6% annually on average since 2019, according to GAPKI data, while output over the same period has risen less than 1% a year in Indonesia, the world's top producer and exporter of palm oil. The increase in the biodiesel mandate would result in lower export volumes. "Achieving 50% is not possible in the next few months since the required trials have not been conducted yet. Achieving 40% itself is a big task," said a Mumbai-based trader. Indonesia's palm biodiesel mandate applies to land transportation, trains, industrial machinery and diesel power plants. Indonesia is also developing palm-based jet fuel and has conducted flight tests, although implementation of the planned 3% biofuel blending for jet fuel by 2020 was delayed. ($1 = 4.3450 ringgit) Sign up here. https://www.reuters.com/business/energy/indonesias-prabowo-hopes-implement-50-palm-based-biodiesel-blending-by-2025-2024-08-26/

2024-08-26 10:23

MUMBAI, Aug 26 (Reuters) - The Indian rupee closed nearly flat on Monday, as dollar demand from importers and foreign banks offset early gains driven by a rise in most Asian currencies. The rupee closed at 83.90 against the U.S. dollar, nearly unchanged from its close at 83.89 in the previous session. The currency hit a peak of 83.81 in early trading. Like last week, the rupee was unable to hold onto gains pressed by dollar demand from importers and foreign banks, a trader at a private bank said. It has struggled to benefit from the dollar's slump in August and is likely to miss out on the emerging market rally after Federal Reserve Chair Jerome Powell signalled support for imminent rate cuts on Friday. The rupee is expected to trade between 83.75 and 84 in the near-term, Amit Pabari, managing director at FX advisory firm CR Forex said. Strong dollar demand from importers and outflows from equities have both contributed to limiting the rupee's gains in recent sessions, Pabari said. Overseas investors have pulled out about $2 billion from Indian stocks over August so far. The dollar index was at 100.7, hovering close to its lowest level since December, while most Asian currencies rose between 0.1% to 0.7%. Meanwhile, dollar-rupee forward premiums jumped after Powell's more dovish-than-expected comments raised the odds of a larger rate cut at the Fed's September meeting. The dollar-rupee 1-year forward premium rose to a peak of 2.14%, the highest since May 2023, before edging lower. Sign up here. https://www.reuters.com/markets/currencies/rupee-ends-flat-unable-benefit-rise-asian-peers-2024-08-26/