All the French clamor about the price of American LNG
French minister Le Maire criticizes the US government for the price of LNG. But it is not the White House that sells it, nor does it set the prices. Here are the private US companies active in the sector. All the details
Speaking at the parliamentary debate on the budget law on Monday, France's Finance Minister Bruno Le Maire said Europe must not fall under the "domination" of the United States, from which it is buying a lot of liquefied natural gas (LNG) to compensate for the gap from Russian supplies.
"We must not allow", said Le Maire, "that the conflict in Ukraine results in American economic domination and a weakening of Europe."
The accusation against the US government
The French minister then accused the US government of exploiting the European gas price crisis to its advantage, aggravated, however, by the invasion of Ukraine and heavy restrictions on flows from Russia.
"We cannot accept that our American partner sells us its LNG for four times the price it sells to its own companies." Le Maire then proposed a "more balanced economic relationship on the energy issue between our American allies and the continent".
WHAT LE MAIRE IS WRONG
When he speaks of "American partner", Le Maire is referring to the US government. But it is not the US government that sells LNG to Europe, or to any other region or country in the world, but private companies. Likewise, it is not the US government that sells fuel to domestic gas and electricity distribution companies but – again – manufacturing and private companies.
WHO DETERMINES THE PRICE OF GAS
Furthermore, the price of gas is determined by the market in which it is sold, and prices on the European market are much higher than those on the American market: the United States government has no power to change them.
In September , natural gas prices on the spot market (the daily and wholesale market) at Henry Hub (the American equivalent of the European TTF) rose to $ 7.88 per million British thermal units (mmBtu), the highest value since 2008 . In Europe, gas prices averaged $ 57.90 per mmBtu in the same month.
– Read also: How gas prices and projects move in the United States
WHO ARE THE AMERICAN EXPORTERS OF LNG
The main American companies that export LNG are Cheniere Energy, Venture Global LNG, Tellurian, Sempra, Freeport LNG and Dominion Energy. Not all are listed.
The largest shareholders of Cheniere Energy are the funds Vanguard Group (8.3%) and BlackRock (6.8%), entrepreneur Carl Icahn (6.3%) and Blackstone (4.6%).
Shareholders of Tellurian include financial services firm State Street Corporation (6.5%), the BlackRock fund (5.9%), Vanguard Group (5%) and French oil company TotalEnergies.
BlackRock (9.2%), Vanguard Group (8.5%) and State Street (5.5%) are shareholders of Sempra. And they also own shares in Dominion Energy: respectively 6.8, 8.6 and 5.2 per cent.
Japanese energy company JERA, the company that buys the most LNG in the world, has a 25.7 percent stake in Freeport LNG.
HOW ARE THE AMERICAN LNG FLOWS GOING
According to Refinitiv data , in September US LNG companies increased exports to Europe: 4.3 million tons of liquefied fuel out of a total of 6.3 million went to the Old Continent. LNG carriers loaded with US LNG usually go to Asia due to the generally higher prices on the local market.
News of the increase in exports in September surprised analysts, considering that since June a major Freeport LNG terminal in Texas – through which about a fifth of US LNG shipments pass – has been out of order due to a fire, and shouldn't. reopen before November.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/bruno-le-maire-gnl-stati-uniti/ on Wed, 12 Oct 2022 11:20:39 +0000.