Europe Forced To Pay Even Higher Prices To Fill Gas Storage

Europe Forced To Pay Even Higher Prices To Fill Gas Storage

By John Kemp, senior market analyst at Reuters

Europe’s gas inventories are on course to reach 976 terawatt-hours (TWh) by the end of the summer…

…compared with 868 TWh at the same point last year, and slightly above the 10-year seasonal average.

The region continues to buy as much liquefied natural gas (LNG) as possible to offset reduced imports from Russia and the possibility of a complete stoppage next winter but it is pushing up prices sharply.

Stocks in the European Union and the United Kingdom (EU28) are on track to be 44 TWh (5%) higher than the average for the previous 10 years, based on past storage trajectories.

The probable range is from 838 TWh to 1077 TWh, and has changed little in recent weeks, as the disruption of pipeline supplies from Russia has been offset by higher prices and more LNG arrivals.

Stocks have increased by a record 369 TWh since the start of April, compared with an increase of just 203 TWh this time last year and a ten-year seasonal average of 272 TWh.

As a result, inventories are 44 TWh (7% or 0.31 standard deviations) above the average for the time of year, having been 129 TWh (23% or 1.37 standard deviations) below average at the end of January.

In recent weeks, the rate of inventory accumulation has slowed to 5 TWh per day, from more than 7 TWh per day in late May.

Until early June, storage had been filling at an unsustainable rate so some deceleration was expected by the end of June or the beginning of July.

Inventory accumulation normally slows at this time of year and the current rate is still slightly above the seasonal average for 2012-2021.

But the reduction in pipeline supplies from Russia has accelerated the adjustment and put explosive upward pressure on prices by forcing European buyers to purchase extra LNG cargoes to make up the shortfall.

Futures prices for deliveries in Northwest Europe in January 2023, in the depths of next winter, have climbed to a record €173 per megawatt-hour (MWh) from €95 in the middle of June.

Soaring prices are signalling the need for conservation by businesses and households and maximum fuel-switching to coal, biomass and hydro by electricity generators to build stocks even faster.

Futures for deliveries in Northwest Europe in January 2023 are also trading at a record premium of €35 per MWh compared with deliveries for the same date in Northeast Asia.

Europe’s buyers are attempting to divert the maximum volume of LNG to improve their own supply situation, in the process squeezing utilities in South and East Asia, worsening shortages at the other end of Eurasia, and pushing up prices for everyone.

Tyler Durden
Wed, 07/06/2022 – 07:35

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OPEC Secretary-General Mohammad Barkindo Unexpectedly Dies

OPEC Secretary-General Mohammad Barkindo Unexpectedly Dies

OPEC Secretary-General Mohammad Barkindo unexpectedly died Tuesday night, several hours after meeting Nigerian President Muhammadu Buhari and giving a speech at an energy summit in the Nigerian capital of Abuja, WSJ reports. 

Barkindo, 63, was expected to retire at the end of July from a six-year tenure as the top official of the Organization of the Petroleum Exporting Countries. He was widely known for crafting a 2016 agreement that included heavyweight producers, like Russia, into the group known as OPEC+.

“We lost our esteemed Dr. Muhammad Sanusi Barkindo,” Nigerian National Petroleum Corp (NNPC) CEO Mele Kyari tweeted. The death is a “great loss to his immediate family, the NNPC, our country Nigeria, the OPEC, and the global energy community,” Kyari added.

During his speech in Abuja, the Nigerian native said the oil and gas industry is currently “under siege” and suffering from severe underinvestment. 

“In a very short timespan, the industry has been hit by two major cycles — the severe market downturn in 2015 and 2016, and the even more far-reaching impact of the Covid-19 pandemic,” Barkindo said hours before his death. 

After leaving OPEC, Barkindo was set to join the US think tank the Atlantic Council as a distinguished fellow in the Global Energy Center. His term as OPEC secretariat expired on July 31, and he will be replaced by Kuwait’s Haitham Al-Ghais.

 “This tragedy is a shock to the OPEC Family. We express our sorrow and deep gratitude for the over 40 years of selfless service that Mohammad Sanusi Barkindo gave to OPEC. His dedication and leadership will inspire OPEC for many years to come,” the OPEC Secretariat said in a Tweet.

Tyler Durden
Wed, 07/06/2022 – 07:11

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Ukraine Fights On as Western Allies Waver


Ukrainian President Volodymyr Zelenskyy in a t-shirt at a podium with three Ukraine flags behind him.

Ukraine’s loss of Lysychansk, the last city it controlled in the Luhansk region in eastern Ukraine, doesn’t seem to have dampened the country’s willingness to fight the Russian invaders, though it does bolster expectations of an extended war. Ukraine’s President Volodymyr Zelenskyy promises to fight on, with the apparent support of his people. But Americans have turned pessimistic about the underdog’s chances and western Europeans are wavering in their support as Russia retaliates against punitive sanctions with an escalating energy embargo. The situation speaks well of the Ukrainian people’s resolve but may not bode well for their fate.

“If the command of our army withdraws people from certain points of the front where the enemy has the greatest fire superiority, in particular this applies to Lysychansk, it means only one thing: we will return thanks to our tactics, thanks to the increase in the supply of modern weapons,” Zelenskyy vowed on July 3. “Ukraine does not give anything up.”

By all accounts, Zelenskyy has the support of the vast majority of his people. A June poll of 1,005 Ukrainian adults by The Wall Street Journal-NORC found 89 percent of them rejecting the idea of achieving peace “by granting Russia control over some parts of Ukrainian territory occupied by Russia after February 24th” when the current war began. A similar 81 percent opposed ceding land occupied earlier, namely Crimea, which was seized by Russia in 2014. About 78 percent supported Zelenskyy’s handling of the war.

But recent fighting has been a tougher slog for Ukraine’s forces than the encouraging early days when Russian troops were turned back from Kyiv. The early shock at defenders unexpectedly destroying invading tanks and repelling invading troops has given way to the reality of a bloody slugfest with no end in sight. “Ukraine needs modern missile and air defense, and you have these systems,” Zelenskyy told NATO summit attendees last week. The continuing flow of such weapons from the West keeps Ukraine in the fight. But it means significant commitments for countries that in many cases, such as that of Germany, started out with underfunded and underequipped militaries with little to spare for somebody else’s defense.

That has also meant some disappointment in the West, where people removed from the fighting hoped for a quick underdog victory based on Ukraine’s successes at the beginning of the conflict. In the United States, early enthusiasm has been replaced by pessimism as the war bogs down. By mid-June, more Americans believed that Russia was winning (25 percent) than gave the edge to Ukraine (19 percent), according to Economist/YouGov polling, a perception that has continued since. The fact that a majority of respondents (54 percent) fear the conflict is at least somewhat likely to lead to a wider war in Europe doesn’t help.

For Europeans, supporting Ukraine means costs beyond their military budgets. Heavily dependent on Russian natural gas, much of Europe has proven highly vulnerable as the aggressor in the war retaliates against punitive economic sanctions by closing the valves on pipelines.

“Germany’s natural-gas crisis, which is being caused by Russia as it takes revenge for sanctions, may get so bad that cities have to ration hot water,” Fortune noted this week. “Germany’s main importer of Russian gas, Uniper, is now only getting 40% of what it contractually ordered from Russia, and the stratospheric cost of substituting for those flows has pushed it into crisis.”

Europeans are preparing for Russia to completely end the flow of gas as early as next week. Out of necessity, Germany has already turned to old-school coal-fired power plants despite the country’s high-profile commitment to green energy.

As a result, there’s waning enthusiasm in Europe for prolonged conflict in Ukraine, no matter the consequences for the people of that country. “Research shows that, while Europeans feel great solidarity with Ukraine and support sanctions against Russia, they are split about the long-term goals,” the European Council on Foreign Relations (ECFR) announced in mid-June. “They divide between a ‘Peace’ camp (35 per cent of people) that wants the war to end as soon as possible, and a ‘Justice’ camp that believes the more pressing goal is to punish Russia (22 per cent of people). In all countries, apart from Poland, the ‘Peace’ camp is larger than the ‘Justice’ camp.” 

“Supporters of the Peace camp want peace now even at the cost of Ukrainian concessions to Russia,” ECFR added.

Fear of higher energy prices and a rising cost of living, as well of the use of nuclear weapons by Russia, were the biggest concerns cited by respondents to the poll.

Of course, “concessions” are exactly what Zelenskyy rejects when he says “Ukraine does not give anything up.” They’re also off the table for his people when they give a thumbs-down to “granting Russia control over some parts of Ukrainian territory.” But western pessimism about the underdog’s chances, and, especially, fears of a cold, dark, and expensive winter to come may undercut support for the military and economic assistance the aggrieved country needs to keep fighting invading forces. What Russia hasn’t been able to win on the battlefield it may come closer to achieving by squeezing westerners already hurting from the after-effects of pandemic lockdowns and inflation fueled by government-spending sprees. No matter their spirit, Ukrainians will have difficulty continuing their defense in the absence of a continued flow of money, weapons, and ammunition.

Everybody loves a good David and Goliath story in which the little guy prevails over the big bully, and the Russo-Ukrainian War is ready made for such an interpretation. But those stories are best enjoyed in the past tense, after David wins the fight. It’s a lot less pleasant to live through the battle when the outcome is uncertain and as Goliath lashes out at David’s friends as well as at the underdog himself. Then, the onlookers have to worry that they might be next, and that they’ll suffer some wounds of their own along the way to the conflict’s ultimate conclusion.

Ukrainians give every appearance of being willing to fight on. But it’s not clear that they’ll permanently enjoy enough international support to continue the defense of their country through what promises to be an extended and painful war.

The post Ukraine Fights On as Western Allies Waver appeared first on Reason.com.

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Ukraine Fights On as Western Allies Waver


Ukrainian President Volodymyr Zelenskyy in a t-shirt at a podium with three Ukraine flags behind him.

Ukraine’s loss of Lysychansk, the last city it controlled in the Luhansk region in eastern Ukraine, doesn’t seem to have dampened the country’s willingness to fight the Russian invaders, though it does bolster expectations of an extended war. Ukraine’s President Volodymyr Zelenskyy promises to fight on, with the apparent support of his people. But Americans have turned pessimistic about the underdog’s chances and western Europeans are wavering in their support as Russia retaliates against punitive sanctions with an escalating energy embargo. The situation speaks well of the Ukrainian people’s resolve but may not bode well for their fate.

“If the command of our army withdraws people from certain points of the front where the enemy has the greatest fire superiority, in particular this applies to Lysychansk, it means only one thing: we will return thanks to our tactics, thanks to the increase in the supply of modern weapons,” Zelenskyy vowed on July 3. “Ukraine does not give anything up.”

By all accounts, Zelenskyy has the support of the vast majority of his people. A June poll of 1,005 Ukrainian adults by The Wall Street Journal-NORC found 89 percent of them rejecting the idea of achieving peace “by granting Russia control over some parts of Ukrainian territory occupied by Russia after February 24th” when the current war began. A similar 81 percent opposed ceding land occupied earlier, namely Crimea, which was seized by Russia in 2014. About 78 percent supported Zelenskyy’s handling of the war.

But recent fighting has been a tougher slog for Ukraine’s forces than the encouraging early days when Russian troops were turned back from Kyiv. The early shock at defenders unexpectedly destroying invading tanks and repelling invading troops has given way to the reality of a bloody slugfest with no end in sight. “Ukraine needs modern missile and air defense, and you have these systems,” Zelenskyy told NATO summit attendees last week. The continuing flow of such weapons from the West keeps Ukraine in the fight. But it means significant commitments for countries that in many cases, such as that of Germany, started out with underfunded and underequipped militaries with little to spare for somebody else’s defense.

That has also meant some disappointment in the West, where people removed from the fighting hoped for a quick underdog victory based on Ukraine’s successes at the beginning of the conflict. In the United States, early enthusiasm has been replaced by pessimism as the war bogs down. By mid-June, more Americans believed that Russia was winning (25 percent) than gave the edge to Ukraine (19 percent), according to Economist/YouGov polling, a perception that has continued since. The fact that a majority of respondents (54 percent) fear the conflict is at least somewhat likely to lead to a wider war in Europe doesn’t help.

For Europeans, supporting Ukraine means costs beyond their military budgets. Heavily dependent on Russian natural gas, much of Europe has proven highly vulnerable as the aggressor in the war retaliates against punitive economic sanctions by closing the valves on pipelines.

“Germany’s natural-gas crisis, which is being caused by Russia as it takes revenge for sanctions, may get so bad that cities have to ration hot water,” Fortune noted this week. “Germany’s main importer of Russian gas, Uniper, is now only getting 40% of what it contractually ordered from Russia, and the stratospheric cost of substituting for those flows has pushed it into crisis.”

Europeans are preparing for Russia to completely end the flow of gas as early as next week. Out of necessity, Germany has already turned to old-school coal-fired power plants despite the country’s high-profile commitment to green energy.

As a result, there’s waning enthusiasm in Europe for prolonged conflict in Ukraine, no matter the consequences for the people of that country. “Research shows that, while Europeans feel great solidarity with Ukraine and support sanctions against Russia, they are split about the long-term goals,” the European Council on Foreign Relations (ECFR) announced in mid-June. “They divide between a ‘Peace’ camp (35 per cent of people) that wants the war to end as soon as possible, and a ‘Justice’ camp that believes the more pressing goal is to punish Russia (22 per cent of people). In all countries, apart from Poland, the ‘Peace’ camp is larger than the ‘Justice’ camp.” 

“Supporters of the Peace camp want peace now even at the cost of Ukrainian concessions to Russia,” ECFR added.

Fear of higher energy prices and a rising cost of living, as well of the use of nuclear weapons by Russia, were the biggest concerns cited by respondents to the poll.

Of course, “concessions” are exactly what Zelenskyy rejects when he says “Ukraine does not give anything up.” They’re also off the table for his people when they give a thumbs-down to “granting Russia control over some parts of Ukrainian territory.” But western pessimism about the underdog’s chances, and, especially, fears of a cold, dark, and expensive winter to come may undercut support for the military and economic assistance the aggrieved country needs to keep fighting invading forces. What Russia hasn’t been able to win on the battlefield it may come closer to achieving by squeezing westerners already hurting from the after-effects of pandemic lockdowns and inflation fueled by government-spending sprees. No matter their spirit, Ukrainians will have difficulty continuing their defense in the absence of a continued flow of money, weapons, and ammunition.

Everybody loves a good David and Goliath story in which the little guy prevails over the big bully, and the Russo-Ukrainian War is ready made for such an interpretation. But those stories are best enjoyed in the past tense, after David wins the fight. It’s a lot less pleasant to live through the battle when the outcome is uncertain and as Goliath lashes out at David’s friends as well as at the underdog himself. Then, the onlookers have to worry that they might be next, and that they’ll suffer some wounds of their own along the way to the conflict’s ultimate conclusion.

Ukrainians give every appearance of being willing to fight on. But it’s not clear that they’ll permanently enjoy enough international support to continue the defense of their country through what promises to be an extended and painful war.

The post Ukraine Fights On as Western Allies Waver appeared first on Reason.com.

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Tesla Is The Most Googled Stock Across The EU

Tesla Is The Most Googled Stock Across The EU

A new study out this week shows that Tesla is the most Googled stock across the European Union. 

CMC Markets revealed the information as part of a new study into the most searched for stock in each EU country. They completed their study using Google search data, as well as examining how many monthly searches automakers receive on average.  

The study found that “Tesla is by far the most popular stock in the EU, with 24 countries searching for ‘Tesla stock’ the most frequently.”

It also found that “Sweden is the country searching the most, with 205,000 searches, followed by Netherlands on 164,000 and Finland with 93,000 searches a month.”

The second most popular stock searched was AMC Entertainment Holdings, with two countries searching for this stock the most, Denmark and Germany. GameStop topped the list in Croatia, with 12,000 searches a month. 

CMC Markets commented on the study: “We’re seeing Tesla dominate interest in the stock market across the EU. The company is a major player in the stock exchange, and an industry leader across the electric vehicle (EV) market. Millions of people want to invest in a company with such a high reputation.” 

They continued: “There is also the environmental aspect which many people are drawn to. Tesla is a brand that positions itself as eco-friendly, and many people, particularly in the EU, want to associate themselves with brands such as these.” 

“As fuel prices continue to rise all over the world, investors are looking to put their money into brands which can offer the best financial return in the future. As the EV market continues to grow, Tesla can be expected to increase in revenue in the future,” the firm concluded.  

CMC calls itself “a leading global provider with 30 years’ experience enabling users to spread bet and trade CFDs on thousands of financial instruments”.

Tyler Durden
Wed, 07/06/2022 – 06:55

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Troop-Cuts Will Put British Army At “Breaking Point”: Former Army Chief

Troop-Cuts Will Put British Army At “Breaking Point”: Former Army Chief

Authored by Alexander Zhang via The Epoch Times,

The UK government’s decision to go ahead with planned troop cuts despite the war in Ukraine is “madness” and will put the British Army at “breaking point,” a former army chief has warned.

Gen. Lord Dannatt, the former chief of the general staff, poses for a photograph after taking part in a photograph to commemorate 100 years since the end of the World War I, at Royal Hospital Chelsea in London, on Oct. 16, 2018. (Leon Neal/Getty Images)

At the NATO summit in Madrid last week, Prime Minister Boris Johnson said the government will increasing its defence spending to 2.5 percent of GDP by the end of the decade.

But the government said it is still going ahead with the decision to cut the army by 10,000 soldiers over the next few years, which was set out in last year’s Integrated Review.

Gen. Lord Dannatt, former head of the British Army, said on July 3:

“It’s a mere fact of life we’ll break the remainder of our army if our army is not large enough … to do what the government of the day wants us to do.”

“You can’t make people work endlessly with too small numbers. So numbers in the terms of our land forces really, really matter.” he told Sky News.

Dannatt urged the government to reverse the cuts, as the army will have to play its part in “deterring Russian aggression,” he said.

The retired general added, “When it comes to old-fashioned fighting, numbers do matter and to have an army of only just over 70,000, 30 percent down from where we were 10 years ago is going to leave us woefully short if we find that we’ve got to maintain large number of troops at high readiness forward-deployed in Eastern Europe.”

‘Perverse’

Johnson’s promise to increase the defence budget was made after he came under pressure from senior Cabinet ministers and military chiefs to boost defence spending.

Defence Secretary Ben Wallace said on June 28 that the UK needs to boost its investment in defence before it is too late.

In a speech at the Royal United Services Institute (RUSI), he said more action is needed to reverse the cuts made by successive governments—both Conservative and Labour—following the Cold War to cash in on the so-called “peace dividend.”

Also speaking at the event, the new head of the British Army, Gen. Sir Patrick Sanders, said any further cuts to the size of the army—which is set to shrink from a target figure of 82,000 troops to 72,500—would be “perverse.”

But Downing Street defended the government’s record on defence funding, insisting the benefits of new technology and kit outweighed cuts in the number of soldiers.

The prime minister’s official spokesman said it would be “wrong” to “focus solely on numbers when we can see the impact that the latest technologies, equipment, training, intelligence are having.”

Tyler Durden
Wed, 07/06/2022 – 06:30

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Supply Chain Chaos Continues Wreaking Havoc in European Auto Stocks

Supply Chain Chaos Continues Wreaking Havoc in European Auto Stocks

More than two years after the beginning of Covid, the auto industry remains in chaos…

Today, the focus is on European auto stocks, which are going to be on watch heading into the new week after automakers had their worst June sales “in decades”, according to a Monday morning wrap up by Bloomberg. 

Names like Faurecia, Volvo Car and Michelin were down between 2% and 6% to start the week after ugly June sales data for the UK and German new car registrations falling off a cliff. 


The UK saw its weakest June since 1996, Auto Express reported Monday. The Society of Motor Manufacturers and Traders is still attributing the sales drop to the “ongoing global shortage of semiconductors” mixed with China’s implementation of severe Covid restrictions. 

EVs, however, saw a 14.6% increase in sales and have seen their market share rise from 10.7% in June 2021 to 16.1% in June 2022. 

“The semiconductor shortage is stifling the new car market even more than last year’s lockdown. Electric vehicle demand continues to be the one bright spot, as more electric cars than ever take to the road, but while this growth is welcome it is not yet enough to offset weak overall volumes, which has huge implications for fleet renewal and our ability to meet overall carbon reduction targets,” said Mike Hawes, chief executive of the SMMT. 

He continued: “With motorists facing rising fuel costs, however, the switch to an electric car makes ever more sense and the industry is working hard to improve supply and prioritize deliveries of these new technologies given the savings they can afford drivers.”

And the chaos shows no immediate signs of letting up. As Bloomberg notes, Volvo has already warned that China shutdowns will have a negative impact on its third quarter sales. 

Tyler Durden
Wed, 07/06/2022 – 05:45

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From Today, All New Vehicles In The EU Will Have Surveillance Black Boxes

From Today, All New Vehicles In The EU Will Have Surveillance Black Boxes

Authored by Paul Joseph Watson via Summit News,

From today, all new vehicles sold in the EU will have mandatory black boxes fitted that record technical data and will be accessible by authorities, greasing the skids for surveillance-powered speed limiting technology.

While for the time being, drivers can opt-out of using the feature, privacy advocates fear the technology will become mandatory once it is properly rolled out.

Back in 2019, the European Transport Safety Council (ETSC) announced that July 6 would mark the day when all car manufacturers would be forced to fit new models with a system that keeps track of technical data.

The data recorded will include “the vehicle’s speed, braking, steering wheel angle, its incline on the road, and whether the vehicle’s various safety systems were in operation, starting with seatbelts.”

Although insurance companies won’t have immediate access to the data, it will be available to law enforcement.

Authorities claim the data will be “anonymized,” meaning the information can’t be used to identify the owner of the vehicle, although only the incredibly naive would plausibly believe that.

Such systems are expected to eventually include speed-limiting technology.

As Reclaim the Net’s Didi Rankovic explains, the most common method of speed limiting technology is Intelligent Speed Assistant (ISA).

“ISA works using GPS data alone, cameras for traffic sign recognition fitted to the front of the car, or a combination of the two. A speed limiter affects the engine power and in that way decreases speed.”

“Like the name suggests, speed limiters are designed to prevent drivers from exceeding certain speed limits, and prompt them via audio, visual, and haptic warnings until they “obey” and slow down.”

For decades, governments have been pushing for all cars to be fitted with black boxes that track location data.

The ultimate dystopian scenario involves giving police the power to utilize similar technology to completely disable the functioning of a vehicle if the driver is deemed to have committed an infraction.

This doesn’t need to be a criminal offense, if the pursuit of social credit score schemes continues to become more invasive, it would eventually be used as a form of punishment for everything from unpaid utility bills to offensive comments posted on social media.

*  *  *

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Tyler Durden
Wed, 07/06/2022 – 05:00

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