US House passes bill to reverse Biden's LNG pause
Feb 22, 2024
U.S. President Joe Biden looks on as he meets with German Chancellor Olaf Scholz in the Oval Office at the White House in Washington, U.S., February 9, 2024. REUTERS/Evelyn Hockstein


WASHINGTON, Feb 15 (Reuters) - A bill to strip the power of President Joe Biden's administration to freeze approvals of liquefied natural gas exports passed in the Republican-controlled U.S. House of Representatives on Thursday but faces an uphill battle in the Senate.


The House approved the bill sponsored by Representative August Pfluger of gas-producing Texas 224-200 on a mostly party-line vote.


The legislation needs to be passed in the Democratic-controlled Senate and signed by Biden to become law, both of which are unlikely.


ClearView Energy Partners, a nonpartisan policy research group, called the bill more of a "messaging effort and a start to debate than an end to the pause," and said it was unlikely to clear the Senate.


The bill strips the power to approve the exports from the Department of Energy and leaves the independent Federal Energy Regulatory Commission as the sole body approving LNG projects.


Biden paused the approvals late last month for exports to big markets in Europe and Asia in order to take a "hard look" at environmental and economic impacts of the booming business. The United States became the largest LNG exporter last year, and its exports are expected to double by the end of the decade.


Pfluger said U.S. LNG supports allies and partners, including those in Europe, which is weaning itself off gas from Russia after Russia's invasion of Ukraine in 2022. "The world needs U.S. LNG, this catastrophic, politically based, and legally dubious ban must be reversed immediately," he said.


Representative Maxwell Frost, a 27-year-old Democrat, said climate advocates who fought LNG projects are heroes. "I can only hope and pray and fight to make sure that we build off" Biden's pause to "get to a green, clean future."


The pause has met with outcry from Republicans who say it will hurt jobs and harm energy security for allies. Some moderate Democrats have also been skeptical of the pause, saying they will push to stop it if it hits jobs.


European Commission Executive Vice President Maros Sefcovic said this week after meeting with Biden officials that the pause will have no impact on U.S. supplies to Europe over the next two or three years. Sefcovic said the U.S. is now the "global guarantor of energy security" and its responsibility goes beyond Europe.


The White House said this week it strongly opposes the House bill but stopped short of a veto threat.


Reporting by Timothy Gardner; Additional reporting by Richard Cowan; Editing by Frances Kerry and Jonathan Oatis


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Oil eases on higher US crude output, hopes of Israel-Hamas ceasefire

By Emalee Springfield • 02 May, 2024
HOUSTON, April 30 (Reuters) - Oil prices fell 1% on Tuesday, extending losses from Monday, on the back of rising U.S. crude production, as well as hopes of an Israel-Hamas ceasefire. Brent crude futures for June, which expired on Tuesday, settled down 54 cents, or 0.6%, at $87.86 a barrel. The more active July contract fell 87 cents to $86.33. U.S. West Texas Intermediate crude futures were down 70 cents, or 0.9%, at $81.93. The front-month contract for both benchmarks lost more than 1% on Monday. U.S. crude production rose to 13.15 million barrels per day (bpd) in February from 12.58 million bpd in January in its biggest monthly increase since October 2021, the Energy Information Administration said. Meanwhile, exports climbed to 4.66 million bpd from 4.05 million bpd in the same period. U.S. crude oil inventories rose by 4.91 million barrels in the week ended April 26, according to market sources citing American Petroleum Institute figures on Tuesday. Stocks were expected to have fallen by about 1.1 million barrels last week, an extended Reuters poll showed on Tuesday. Official data from the EIA is due on Wednesday morning. Gasoline inventories fell by 1.483 million barrels, and distillates fell by 2.187 million barrels. Expectations that a ceasefire agreement between Israel and Hamas could be in sight have grown in recent days following a renewed push led by Egypt to revive stalled negotiations between the two. However, Israeli Prime Minister Benjamin Netanyahu vowed on Tuesday to go ahead with a long-promised assault on the southern Gaza city of Rafah. "Traders believe some of the geopolitical risk is being taken out of the market," said Dennis Kissler, senior vice president of trading at BOK Financial. "We're not seeing any global supply being taken off the market." Continued attacks by Yemen's Houthis on maritime traffic south of the Suez Canal - an important trading route - have provided a floor for oil prices and could prompt higher risk premiums if the market expects crude supply disruptions. Investors also eyed a two-day monetary policy meeting by the Federal Reserve Open Market Committee (FOMC), which gathers on Tuesday. According to the CME's FedWatch Tool, it is a virtual certainty that the FOMC will leave rates unchanged at the conclusion of the meeting on Wednesday. "The upcoming Fed meeting also drives some near-term reservations," said Yeap Jun Rong, market strategist at IG, adding that a longer period of elevated interest rates could trigger a further rise in the dollar while also threatening the oil demand outlook. Some investors are cautiously pricing in a higher probability that the Fed could raise interest rates by a quarter of a percentage point this year and next as inflation and the labor market remain resilient. U.S. product supplies of crude oil and petroleum products, EIA's measure of consumption, rose 1.9% to 19.95 million bpd in Feb. However, concerns over demand have crept up as diesel prices weakened . Balancing the market, output from the Organization of the Petroleum Exporting Countries has fallen in April, a Reuters survey found, reflecting lower exports from Iran, Iraq, and Nigeria against a backdrop of ongoing voluntary supply cuts by some members agreed with the wider OPEC+ alliance. A Reuters poll found that oil prices could hold above $80 a barrel this year, with analysts revising forecasts higher on expectations that supply will lag demand in the face of Middle East conflict and output cuts by the OPEC+ producer group. View on the Reuters Website

Oil and gas industry’s “strong” free cash flow to support increasing production targets

By Emalee Springfield • 01 May, 2024
Last year, the demand for loans from oil and gas companies fell 6% year-on-year, and that followed a decline of 1% in 2022. Oil and gas companies don’t need a lot of loans because they’re generating so much money these days from their underlying businesses, said Andrew John Stevenson, senior analyst at Bloomberg Intelligence. And that trend is likely to continue through the end of the decade, he said. “The oil and gas industry has experienced a number of booms and busts over the past few decades, but for now, it appears to be flush with cash,” he said. The healthy balance sheets reflect the boost that companies have received from rising oil prices, buoyed by robust demand and OPEC+ production cuts. The sector’s free cash flow is so strong that the group’s leverage ratio, which measures a company’s net debt relative to earnings before interest, taxes, depreciation and amortization, fell to 0.8 in 2023 from 2.4 in 2020, Stevenson said. The ratio will likely slide below zero by the end of the decade, he said.
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