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Trump backs new deal to avoid shutdown: Update

  • Market: Biofuels, Coal, Crude oil, Emissions, Natural gas, Oil products
  • 19/12/24

Adds updates throughout

US president-elect Donald Trump is offering his support for a rewritten spending bill that would avoid a government shutdown but leave out a provision authorizing year-round 15pc ethanol gasoline (E15) sales.

The bill — which Republicans rewrote today after Trump attacked an earlier bipartisan agreement — would avoid a government shutdown starting Saturday, deliver agricultural aid and provide disaster relief. Trump said the bill was a "very good deal" that would also include a two-year suspension of the "very unnecessary" ceiling on federal debt, until 30 January 2027.

"All Republicans, and even the Democrats, should do what is best for our Country, and vote 'YES' for this Bill, TONIGHT!" Trump wrote in a social media post.

Passing the bill would require support from Democrats, who are still reeling after Trump and his allies — including Tesla chief executive Elon Musk — upended a spending deal they had spent weeks negotiating with US House speaker Mike Johnson (R-Louisiana). Democrats have not yet said if they would vote against the new agreement.

"We are prepared to move forward with the bipartisan agreement that we thought was negotiated in good faith with House Republicans," House minority leader Hakeem Jeffries (D-New York) said earlier today.

That earlier deal would have kept the government funded through 14 March, in addition to providing a one-year extension to the farm bill, $100bn in disaster relief and $10bn in aid for farmers. The bill would also provide a waiver that would avoid a looming ban on summertime sales of E15 across much of the US. Ethanol industry officials said they would urge lawmakers to vote against any package without the E15 provision.

"Pulling E15 out of the bill makes absolutely no sense and is an insult to America's farmers and renewable fuel producers," Renewable Fuels Association chief executive Geoff Cooper said.

If no agreement is reached by Friday at 11:59pm ET, federal agencies would have to furlough millions of workers and curtail services, although some agencies are able to continue operations in the event of a short-term funding lapse. Air travel is unlikely to face immediate interruptions because key federal workers are considered "essential," but some work on permits, agricultural and import data, and regulations could be curtailed.

The US Federal Energy Regulatory Commission has funding to get through a "short-term" shutdown but could be affected by a longer shutdown, chairman Willie Phillips said. The US Department of Energy expects "no disruptions" if funding lapses for 1-5 days, according to its shutdown plan. The US Environmental Protection Agency would furlough about 90pc of its nearly 17,000 staff in the event of a shutdown, according to a plan it updated earlier this year.


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20/12/24

Australia’s Cleanaway, LMS to produce landfill gas

Australia’s Cleanaway, LMS to produce landfill gas

Sydney, 20 December (Argus) — Australian waste management operator Cleanaway and bioenergy firm LMS Energy will partner on a 22MW landfill gas-fired power station at Cleanaway's Lucas Heights facility near the city of Sydney. Cleanaway, Australia's largest publicly listed waste management firm, will receive exclusive rights to landfill gas produced at Lucas Heights for 20 years, the company said on 20 December. LMS will invest A$46mn ($29mn) in new bioelectricity assets, including a 22MW generator. Tightening gas markets owing to underinvestment in new supply has led to speculation that more waste-to-energy plants could be brought on line in coming years, especially in the southern regions. Landfill gas projects receive Australian Carbon Credit Units (ACCUs) by avoiding methane releases, with the total ACCU quantity calculated after a default baseline of 30pc is deducted for projects beginning after 2015. A total of 42.6mn ACCUs were issued to landfill gas projects since the start of the ACCU scheme in 2011, 27pc of the total 155.7mn and the second-largest volume after human-induced regeneration (HIR) methods at 46.68mn. Canberra is reviewing ACCU issuance for these projects, and wants most projects to directly measure methane levels in captured landfill gas to avoid overestimation. Landfill gas operations which generate electricity from the captured gases can also receive large-scale generation certificates (LGCs). LMS has 70 projects currently registered at the Clean Energy Regulator (CER) and has received 24.57mn ACCUs since the start of the scheme. This is the largest volume for any single project proponent, just ahead of Australian environmental market investor GreenCollar's subsidiary Terra Carbon with 23.57mn units. Cleanaway received almost 1mn ACCUs from two projects and has four other projects that have yet to earn ACCUs. By Tom Major and Juan Weik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Power supply crisis to lift Ecuador’s GHG emissions


19/12/24
News
19/12/24

Power supply crisis to lift Ecuador’s GHG emissions

Quito, 19 December (Argus) — Ecuador's greenhouse gas emissions have likely risen in 2024 as the country grappled with an ongoing power supply crisis because of severe droughts, interim energy minister Ines Manzano told Argus . Although the government has yet to calculate the exact percentage increase in GHG emissions, Manzano confirmed the increase after six months of droughts that led to a significant decline in hydropower output and extensive daily power outages of 3-14 hours from 23 September-20 December. Thermoelectric plants consumed an average of 26,560 b/d of diesel, fuel oil, natural gas and crude residue from January-October 2024, a 35pc year-on-year increase, Petroecuador data show. This trend is expected to continue through the end of the year as Ecuador will have installed and rented an additional 400 MW of thermoelectric capacity, including land-based plants and power barges by December. This expansion represents a 5pc increase in the country's total installed power capacity. In 2023, thermoelectric power plants emitted 3.7mn t of CO2 equivalent (CO2e), marking a year-on-year increase of 48pc, data from the energy ministry show. Drought-related challenges also led to 35 days of blackouts from October-December 2023, increasing reliance on thermoelectric power. That year, emissions from thermoelectric plants accounted for 9pc of the 43mn t of CO2e emitted by the energy sector, up from 6pc in 2022. The outlook for 2025 suggests little relief from the current trend. By April 2025 the government plans to bring online an additional 1.3GW of thermoelectric capacity, compared with April 2024, while adding only one new hydroelectric plant — the 204MW Toachi-Pilaton. By Alberto Araujo Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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US Congress passes waterways bill


19/12/24
News
19/12/24

US Congress passes waterways bill

Houston, 19 December (Argus) — The US Senate has passed a bipartisan waterways infrastructure bill, providing a framework for further investment in the country's waterways system. The waterways bill, also known as the Water Resources and Development Act (WRDA), was approved by the Senate in a 97-1 vote on 18 December after clearing the US House of Representatives on 10 December. The WRDA's next stop is the desk of President Joe Biden, who is expected to sign the bill. The WRDA has been passed every two years, authorizing the US Army Corps of Engineers (Corps) to undertake waterways infrastructure and navigation projects. Funding for individual projects must still be approved by Congress. Several agriculture-based groups voiced their support for the bill, saying it will improve transit for agricultural products on US waterways. The bill also shifts the funding of waterways projects to 75pc from the federal government and 25pc from the Inland Waterways Trust Fund instead of the previous 65-35pc split. "Increasing the general fund portion of the cost-share structure will promote much needed investment for inland navigation projects, as well as provide confidence to the industry that much needed maintenance and modernization of our inland waterway system will happen," Fertilizer Institute president Corey Rosenbusch said. The bill includes a provision to assist with the damaged Wilson Lock along the Tennessee River in Alabama. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Viewpoint: Politics, economy key to bitumen recovery


19/12/24
News
19/12/24

Viewpoint: Politics, economy key to bitumen recovery

London, 19 December (Argus) — Political change and uncertainty will come to dominate the European bitumen market more than usual in 2025, while demand could decline further than it did in 2024. Market participants are trying to pin down the bottom of the market for bitumen demand, after falling for several years in most of Europe. And support for demand seems far from certain in 2025 given spiralling public debt, political uncertainty and a lack of funding for road maintenance and projects in most European countries. But there could be some positive economic news as interest rates start to fall and inflation returns to more normal levels, while the outlook for oil prices in 2025 is less bullish than previously with plentiful supply forecast. Increased supply and lower crude prices would tend to pressure lower bitumen prices, which could support consumption, given road budgets can be stretched further. Politics seems more unpredictable than ever, with various elections and other changes expected in 2025, often shifting to the right or populist wing in Europe. The necessity of road maintenance and project work to support economies is plain to see for governments, but there is uncertainty on the priority they will be given by some new political forces emerging. Bitumen production is still going to be plentiful in the new year, despite some refinery closures and problems in the past year and more. Issues at both Greek and Turkish refineries, which are powerhouses for Mediterranean bitumen exports, will not have a major impact given the weaker demand in much of north Africa and the lack of available arbitrage routes. Outlets to the US and east of Suez are closed at present and show little sign of re-emerging strongly in the period ahead. Spring maintenance, particularly a February to May shutdown at Algerian Sonatrach's 198,000 b/d Augusta refinery in Sicily, will also limit supply just when demand starts to seasonally rise. In the last viewpoint Argus expected a weaker year for 2024 demand, while also looking at pricing and how differentials to high-sulphur fuel oil (HSFO) could go negative. As winter approaches at the end of 2024 this has happened in the north of Europe and fob cargo discounts have been seen in the eastern Mediterranean all year. Bitumen market fundamentals have drifted further away from those of crude and HSFO in the last year, although a relationship still exists with HSFO maintaining a persistent standing as a price marker for inland bitumen markets for weekly or monthly calculations and for export waterborne prices as the basis with a differential. But Argus expected that traders would seek more arbitrage movements from the European Mediterranean, and this did not come to fruition in 2024, with little seen moving to the US and even less to the Asia-Pacific region. There is not much indication this will change in 2025 with lower prices and plentiful supply in Asia and US supply points. Poorer refining margins may have an impact in 2025 after the strength post-Covid, which will put more renewed pressure on older and simpler refiners to close. These facilities are more likely to produce bitumen. Instead traders will rely on large new ships to feed supply and move bitumen longer distances, a trend already well underway with a number of new ships entering service. Freight costs should stay at elevated levels given the ETS scheme comes into fuller effect in 2025 after first being implemented in 2024. The inclusion of shipping in this EU scheme will oblige shipowners and charterers of vessels from 5,000 gross tonnes to purchase carbon allowances, rising from 40pc of carbon emissions in 2024, to 70pc in 2025, before 100pc in 2026. From uncertainty can come opportunity and with the worst of the economic outlook now behind us then perhaps 2025 can be the beginning of the end in the downtrend for bitumen demand and we start to see vital road maintenance work and infrastructure projects get the funding they need. By Jonathan Weston Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Cold Nov weighs on Bulgarian gas liquidity


19/12/24
News
19/12/24

Cold Nov weighs on Bulgarian gas liquidity

London, 19 December (Argus) — Cold weather across the Balkan region in November might have triggered southeast European gas buyers to increase nominations under their long-term gas contracts, leaving less available gas to trade on Bulgaria's Balkan Gas Hub (BGH). This fluctuation in Bulgarian trading activity in the wider Balkan region is part of a larger trend that could persist in the coming months. BGH liquidity dropped in November from October — traded day-ahead volumes averaged just over 40 GWh/d, down from 66 GWh/d in October. And this trend has continued into December, with traded volumes at about a third of their October level. Daily lows in Bulgaria's capital Sofia moved below freezing in early November and cold weather persisted for almost the entire month, after temperatures had been about 3°C on average in the second half of October. Bulgarian demand consequently increased, rising to 106 GWh/d in November from 77 GWh/d in October and about 94 GWh/d in November 2023 (see graph). The same weather patterns boosted demand across the Balkan region, supporting prompt prices in Romania and Greece and attracting more supply. Gas demand from the Romanian distribution network was up to 296 GWh/d in the first half of November from 187 GWh/d in the same period last year. And Greek imports almost doubled to 190 GWh/d in the same period, as the country's gas-fired power generation climbed. This jump in Balkan demand pushed up the region's prompt prices. Volume-weighted average prices on the Greek Henex exchange rose by more than €15/MWh in just two weeks. The Argus Romania VTP everyday price was €42.80/MWh on 15 November, up from €33.67/MWh on 1 November. And while Bulgaria widely remained the lowest-priced market in the region after Turkey, the BGH volume-weighted average price was up to almost €47/MWh near the end of November from about €34/MWh at the beginning of the month. This jump in regional demand might have pushed direct Gazprom buyers to use their contracts in full, leaving less available gas to sell on the Bulgarian spot market (see graph) . Russian inflows at the Strandhza 2/Malkoclar point were 511 GWh/d in November, up from 442 GWh/d a year earlier. At the same time, the start of contractual Azeri deliveries to Serbia has further reduced available Azeri gas to sell on the spot market. Outflows to Serbia from Bulgaria through the Interconnector Bulgaria Serbia (IBS) have held at 12 GWh/d since the beginning of November. Serbia's Srbijagas has a contract with Azeri state-owned Socar for up to 1mn m³/d, and an additional shorter-term deal for up to 1mn m³/d in November 2024-March 2025. Socar has been the only user of the IBS this year so far, based on data it released earlier this year on sales to Serbia, which perfectly matched pipeline flows. Socar and Turkish state-owned Botas have a transfer agreement since June this year, which has supported direct flows to Bulgaria from Turkey at Strandzha 1/Malkoclar. And flows through this point increased over the course of November, although Turkey's increased demand might have slowed outflows down. By Ugur Yildirim Bulgaria's implied demand with temperatures Traded volume with price Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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