The hottest natural gas price roller coaster specu

2022-09-26
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Natural gas price "roller coaster" speculators "pulled chestnuts out of the fire" gloomily "

since December last year, the LNG (liquefied natural gas) market quotation has risen all the way from 6558.33 yuan/ton to the record high of 8477.78 yuan/ton on December 25 last year, with an increase of nearly 30%. However, in the following week, this quotation fell to a high level, and the market quotation fell to 5500 yuan/ton on January 4, with a decrease of more than 33%

"such a rapid decline has suddenly secured a lot of speculative funds." A natural gas downstream enterprise said

in the view of insiders, with the careful deployment of relevant national departments for the shortage of natural gas supply this year, as well as the major oil companies' strengthening of pipe interconnection and actively expanding LNG storage and transportation capacity, even if there is a shortage of natural gas supply again this year, relevant departments are also able to effectively resolve risks

Zhang Yuqing, former deputy director of the national energy administration, pointed out at the recent forum that the global LNG oversupply will intensify in the future, so the domestic natural gas supply is fully guaranteed

speculative capital "each shows his magic power"

many parties learned that since last October, the domestic LNG market has changed dramatically, and a large number of speculative capital have poured into each show his magic power

the reason is that in September last year, the Ministry of housing and urban rural development and other four departments issued the guiding opinions on promoting clean heating in cities and towns in northern heating areas, focusing on promoting the "coal to gas", "coal to electricity" and renewable energy heating projects in "2+26" Cities in Beijing, Tianjin, Hebei and the surrounding areas, which put forward higher requirements for the modification of PBT materials and completely eliminated bulk coal heating

"speculative capital therefore smells the opportunity to make money." The person in charge of the above-mentioned downstream natural gas enterprises analyzed that, on the one hand, the winter heating season has led to a sharp increase in natural gas demand, on the other hand, the operating rate of liquefied natural gas enterprises in many northern regions is between 20% and 40%, and the supply is insufficient. Some institutions even predicted that the total natural gas supply gap in the winter heating season in 2017 was as high as 10.5 billion cubic meters, that is, the daily domestic natural gas supply gap was about 80million cubic meters

this quickly ignited the enthusiasm of speculative capital

he recalled that at first, many natural gas downstream enterprises entrusted relationships everywhere, purchased LNG from natural gas suppliers such as PetroChina and CNOOC in the south, and then transported it to the north for sale. At that time, there was a shortage of natural gas supply in northern China, making LNG one price a day

Baichuan information data shows that since September last year, LNG in northern China has increased by more than 100%, and even at the end of November last year, several large LNG companies in North China raised LNG prices by more than 20% in a day

"as far as I know, at that time, many hot money were still looking for downstream companies of natural gas, and the latter provided funds to hoard LNG for rising prices. Sometimes, if you hoard natural gas for days, you can harvest more than 30% of the price difference income." Luo Gang (a pseudonym), a domestic private LNG trading company, accurately reported the mechanical properties of this kind of spring. What's more, many investment institutions simply went to Singapore and directly invested heavily in natural gas futures

------ Professor Li Qian/Dean of the school of mechanics and Engineering Sciences of Zhengzhou University

the reason is that affected by the shortage of domestic natural gas supply, the spot price of natural gas in Singapore once hit the highest value of $10.26 per million British thermal units (mmbtu) since 2015 in late December last year, doubling from six months ago. Correspondingly, the LNG futures price hovered around $8 per million British thermal units, There is room for spread arbitrage of at least $2

at the same time, some speculative capital speculated in the overseas shipping pricing trading market to buy up the freight of LNG ships, betting that the sharp increase in China's natural gas imports will cause the relevant shipping costs to soar

according to the data of Clarkson and Fearnley, the LNG shipping fee with a loading capacity of 160000 cubic meters in December last year once hit US $80000, an increase of more than 150% over eight months ago

this led to the continuous rise of domestic LNG prices. On December 25 last year, the domestic LNG quotation hit a record high of 8477.78 yuan/ton. Some enterprises in northern China even offered 9500 yuan/ton, and even the ex factory price of some LNG enterprises in Shandong and Jiangsu directly hit the 10000 yuan mark

forced to stop loss and leave the market

in Luo Gang's view, the biggest driving force that triggered the sharp decline in LNG prices in the past week was the "coming" of the regulatory stick, and the second was that speculative capital underestimated the ability of relevant departments to coordinate resources of all parties to improve natural gas supply

On December 18 last year, Meng Wei, spokesman of the national development and Reform Commission, also pointed out that special supervision and inspection of natural gas market prices should be carried out immediately, focusing on the fabrication and dissemination of price increase information and other acts that disrupt market order, and resolutely investigate and deal with malicious hoarding, bid up prices, as well as illegal acts such as operators reaching monopoly agreements and abusing market dominance

two days later, the price supervision, inspection and antitrust bureau of the national development and Reform Commission began to investigate the suspected violation of the antitrust law by 17 enterprises including PetroChina Daqing branch

"this has a considerable deterrent to speculative capital." The person in charge of the natural gas downstream enterprise recalled. Since late December last year, some sensitive hot money began to require LNG enterprises to quickly sell their accumulated LNG inventory and withdraw their funds from the market as soon as possible. However, some speculative institutions chose to stay

"unexpectedly, the domestic LNG supply and demand relationship has changed significantly in the past week." Luo Gang pointed out that on the one hand, the national development and Reform Commission actively promoted major oil companies to strengthen the interconnection of pipelines and stimulate the potential of natural gas supply; on the other hand, oil companies actively increased overseas natural gas procurement to make up for the domestic natural gas gap, and even the situation that LNG loaded ships were diverted from Brazil to China, which effectively alleviated the domestic natural gas supply gap

more importantly, under the guidance of relevant departments, the LNG quotation provided by large oil companies is lower than the market price. Even if the market quotation exceeds 8000 yuan/ton, their quotation is still between 4500 yuan/ton and 5100 yuan/ton. With the continuous increase of low-cost natural gas supply, the LNG market quotation will inevitably fall sharply

many parties learned that under the pressure of the domestic LNG price falling by more than 30% in the past week, many investment institutions have stopped the loss of overseas LNG futures

a person in charge of an investment institution that once participated in buying up overseas LNG futures revealed that since the average holding cost of LNG futures of domestic capital is about US dollars/million British thermal units (mmbtu), now closing positions and leaving the market will face losses of more than 15% of these enterprises based on products with low technical requirements

"to make matters worse, many downstream natural gas enterprises are entrusted to hoard LNG hot money at 7000 yuan/ton, and the loss will exceed 20%." He spoke bluntly. Now many investment institutions around him have also begun to retreat to avoid the LNG market price "falling down the wall and being pushed by others" and suffering higher losses

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