Qantas budgets for overseas travel restart in October
Australian national airline Qantas Airways is working towards air travel to international destinations from Australia resuming by the end of October as the federal government lifts Covid-19 restrictions. This is three months later than the guidance it gave in August.
"The working assumption for international travel to restart has moved to the end of October 2021, with the exception of a material increase in trans-Tasman flying scheduled for July 2021," Qantas said.
International flights from Australia account for the largest share of the country's total jet fuel consumption, with international capacity currently at about 8pc of pre-Covid-19 levels. But domestic air travel in Australia is slowing recovering towards pre-Covid-19 levels, with the airline's domestic capacity expected to increase to 60pc of pre-Covid-19 levels in the January-March 2021 quarter and 80pc for April-June.
The reduced flying activity led to an 85pc fall in fuel costs in the first half of the 2020-21 fiscal year from a year earlier. Fuel costs for 2020-21 are expected to be lower than the A$2.9bn in 2019-20.
Qantas has also increased its share of domestic air travel to around 70pc from around 60pc pre-Covid-19 levels. This hit smaller airlines such as Qantas' main domestic competitor Virgin Airlines, which went into administration last year and was ultimately sold to private equity owners.
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La deuda de Pemex sobresale en el panorama electoral
La deuda de Pemex sobresale en el panorama electoral
Mexico City, 15 April (Argus) — La campaña presidencial de México termina en menos de dos meses, pero aunque ambas candidatas proponen una revolución verde en el sector de la energía, ninguna de ellas ha propuesto un plan viable para evitar la implosión financiera de la empresa estatal Pemex. Claudia Sheinbaum, candidata de continuidad para la política energética nacionalista del Presidente Andrés Manuel López Obrador, anunció el mes pasado su estrategia energética, comprometiéndose a aumentar la producción de petróleo y gas de Pemex, aumentar el rendimiento de las refinerías y la producción petroquímica, desarrollar una industria nacional de litio y buscar un nuevo enfoque en la generación de energía renovable. La antigua jefa de gobierno de la Ciudad de México no ha proporcionado detalles sobre ninguna de estas políticas, pero es difícil conciliar su compromiso con una ampliación de las energías renovables con un límite en la inversión del sector privado sin depender en gran medida del aumento de la financiación de la estatal de electricidad CFE. La política de Sheinbaum en materia de energías renovables es la única desviación de la agenda energética de López Obrador, aunque las agencias de calificación, los inversores y los analistas coinciden en que es probable que Pemex incurra en impago sin una amplia reforma estructural. Pemex tenía una deuda total de $106,100 millones a finales de 2023 y se enfrenta a $10,000 millones en vencimientos de deuda este año. El impulso del gobierno para aumentar el rendimiento de las refinerías ha generado pérdidas de miles de millones de dólares para Pemex. Solo en 2023, la división de refinación de Pemex reportó una pérdida de $4,400 millones, una mejora con respecto a una pérdida de $11,000 millones el año anterior. De 2019 a 2023, la división de refinación de la empresa registró más de $46,000 millones en pérdidas. López Obrador puso el rescate de Pemex y sus refinerías en el centro de su administración. Pero a pesar de no detener la espiral de deuda de la empresa, la disminución de la producción de crudo, el empeoramiento del récord de seguridad y el aumento de las emisiones de gases de efecto invernadero, sus políticas han tenido un coste que Sheinbaum no ha querido refutar públicamente. En su lugar, se compromete a lanzar el proyecto de la refinería Olmeca de 340,000 b/d de la empresa, que ya tiene dos años de retraso y ha costado al menos el doble del presupuesto original de $8,000 millones, dinero que las agencias de calificación afirman que debería haberse dirigido al negocio principal de Pemex en la exploración y producción. El apoyo gubernamental a Pemex, por un total de más de $52,000 millones entre 2019 y 2023, ha sido incapaz de mover la aguja en sus métricas financieras u operativas, y ahora amenaza la calificación crediticia soberana de México. Sheinbaum ha evitado abordar públicamente la carga de la enorme deuda de Pemex, proponiendo únicamente "niveles de deuda aceptables en el sector de la energía". Pero dada la importancia de Pemex para el proyecto político del partido Morena, además los cientos de miles de puestos de trabajo que dependen de Pemex, no se puede permitir que la empresa incumpla. Por otro lado, la candidata de oposición Xóchitl Gálvez pide poner fin al "caos financiero" en Pemex, diversificar su negocio hacia iniciativas de bajas emisiones de carbono, políticas rigurosas de emisiones, el cierre de sus refinerías más contaminantes, un nuevo enfoque en renovables y una reapertura de la industria energética a la inversión del sector privado. Sin embargo, a pesar de su perspectiva más favorable para la inversión privada, Gálvez aún no ha ofrecido una solución detallada para la situación financiera de Pemex. Sus planes para Pemex pueden ser demasiado radicales para los votantes, especialmente dentro del importante sindicato de trabajadores del petróleo, que repudió rápidamente sus llamados el mes pasado para cerrar dos refinerías. Incluso si ganara, la oposición que representa podría tener dificultades para acordar un camino a seguir para Pemex. Si la próxima administración vuelve a abrir la puerta a la inversión del sector privado, el nuevo gobierno se enfrentará a un esfuerzo lento para reconstruir los reguladores de la energía que han sufrido de baja inversión en los últimos seis años. Pero será el tamaño de la posible victoria de Sheinbaum lo que determinará el futuro del sector de la energía mexicano. Una mayoría convincente podría permitirle aprobar las grandes reformas energéticas que eludieron a López Obrador y seguir limitando la participación del sector privado en el sector energético, justo cuando la inversión directa extranjera en México está en auge en otras industrias. Por Rebecca Conan Producción de crudo en México Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Singapore, Rotterdam advance 'green' shipping corridor
Singapore, Rotterdam advance 'green' shipping corridor
Singapore, 15 April (Argus) — The Singapore-Rotterdam Green and Digital Shipping Corridor (GDSC) is accelerating its decarbonisation efforts with new partners, and is advancing initiatives to encourage the uptake of sustainable marine fuels. The world's two largest marine fuel hubs established the Singapore-Rotterdam GDSC in August 2022, in a push for maritime decarbonisation and digitalisation between the ports. There are 26 global value-chain partners in the GDSC initiative including fuel suppliers, shipping lines, knowledge partners and financial entities. German container shipping line Hapag-Lloyd is the latest partner in the Singapore-Rotterdam trade lane, committing to operate large container vessels on zero and near-zero carbon emission fuels. Hapag-Lloyd is the world's fifth-largest liner shipping firm with at least 260 ocean-going vessels, according to the Maritime and Port Authority of Singapore (MPA). GDSC working groups will also pilot the uptake of sustainable marine fuels — like bio-methane, methanol, ammonia, and hydrogen — and test out commercial structures to reduce cost barriers in switching to alternative fuels. This includes a bio-methane working group that is studying regulations and standards to support adopting the fuel for marine bunkering on a commercial scale. GDSC partners also plan to carry out bio-LNG bunkering pilots over 2024-25, based on a mass balancing chain of custody principle. A methanol working group is working on fuel standards and knowledge exchange, in addition to addressing common challenges to carry out commercial methanol bunkering at Singapore and Rotterdam. And an ammonia working group is developing a framework to assess the lifecycle greenhouse gas intensity of green ammonia for bunkering, to be completed by 2025. Improvements to digitalisation have also been made as part of the GDSC initiative, with Singapore and Rotterdam successfully piloting an exchange of port-to-port data. Both ports will be able to exchange vessel arrival and departure times for port planning, and ships travelling between Singapore and Rotterdam can also optimise their port call voyage. The maritime sector is pushing towards a more resilient and efficient energy transition, and participants have pointed out that collaboration between countries and stakeholders would be key to green shipping corridors . The GDSC is a "very valuable collaboration in accelerating the twin transition: the integration of digital innovation in energy transition efforts," said chief executive officer of Port of Rotterdam Authority (PoR), Boudewijn Siemons. "Not only are we seeing the first results in standardization and data sharing for Port Call Optimization but also the first steps in moving towards operationalization of zero and low carbon fuels on this trade lane." Progress on the GDSC development also reflects that "public-private collaboration across global value chains can be achieved," said MPA chief executive Teo Eng Dih. By Cassia Teo Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
G7 leaders to meet over Iran's attack on Israel
G7 leaders to meet over Iran's attack on Israel
Dubai, 14 April (Argus) — Leaders of the G7 will meet today, 14 April, to co-ordinate a diplomatic response to Iran's overnight air attack on Israel, which ushered a new phase in a six-month conflict that is threatening regional escalation. G7 presidency Italy "has organized a conference at leaders' level for the afternoon of today," Italian prime minister Giorgia Meloni said on X, formerly Twitter. US President Joe Biden has pledged a co-ordinated G7 diplomatic response and condemned the Iranian assault. Iran fired hundreds of drones and missiles against Israel on the evening of 13 April, according to the country's state-owned news agency Irna. Almost all were intercepted before they reached Israeli airspace and there were no fatalities reported by Israel. One civilian was injured and an air force base in southern Israel was lightly damaged, according to the Israel Defence Forces (IDF). The Iranian attack came in response to a suspected Israeli air strike on the vicinity of Iran's embassy compound in Damascus, Syria, on 1 April. Tehran's foreign minster Hossein Amir-Abdollahian said Iran considers this to be the end of its operation. But energy markets, which have been supported in recent weeks by a geopolitical risk premium, will face a week of uncertainty about whether Israel will retaliate. The front-month June Ice Brent contract was trading at $90.45/bl before markets closed for the weekend, and hit a more-than five month high of $92.18/bl on Friday, 12 April. Israeli officials said the attack was "a severe and dangerous escalation" from Tehran. Israel's war cabinet is meeting today to discuss a response. "We will build a regional coalition and exact the price from Iran in the fashion and timing that is right for us," said cabinet minister Benny Gantz. The US is urging Israel to claim victory for its defence, in an apparent effort to discourage Israeli prime minister Benjamin Netanyahu's government from feeling compelled to retaliate. While noting that Israel ultimately will make the decision as to how to respond, White House national security communications co-ordinator John Kirby, in a televised interview today, hailed what he called Israel's "incredible military achievement" in defending itself against the attack. Very little managed to penetrate the defensive shield, "and the damage was extraordinarily light," he said. The US military played a role in helping to defend against the attack, bringing down "several dozens of drones and missiles," Kirby said. UK prime minister Rishi Sunak said the Royal Air Force shot down "a number of Iranian attack drones". Israel's western allies are urging it to show restraint as they try to prevent a wider conflict in the Middle East, which could directly affect oil producers and send energy prices soaring. President Biden is especially keen to avoid such a scenario in an election year. By Bachar Halabi and David Ivanovich Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
India's Modi exploits energy to boost poll support
India's Modi exploits energy to boost poll support
Short-term support for key election constituencies could weigh on longer-term energy policy priorities, writes Rituparna Ghosh Mumbai, 12 April (Argus) — Energy issues are taking a starring role in India's forthcoming election, less because of what is at stake in terms of long-term policy and more because of how the government of prime minister Narendra Modi is using voter-friendly initiatives to try and secure the support of key parts of the electorate. India's federal elections are set to take place over the next two months, and Modi's BJP party holds a comfortable poll lead over a largely disorganised opposition — a lead they hope will translate into an absolute majority for a third consecutive term. But Modi's government is looking to consolidate that support through a number of measures that embrace both traditional and cleaner energy sources. The government has cut retail gasoline and diesel prices after a two-year freeze, and expanded subsidies for LPG — a key cooking fuel for many Indian households. At the same time, it has subsidised ethanol production, providing a boost to Indian farmers, and launched a $9bn programme to promote rooftop solar power. The 2 rupees/litre ($3.80/bl) cut in fuel pump prices is the most eye-catching move so far, and the most blatant pre-election bribe — it was unveiled just two days before India's election rules prevented the government from making any further new policy announcements. These measures may help Modi secure a third term, but they could also create problems for his next administration in areas of energy security, foreign investment and energy transition. Freezing over The two-year fuel price freeze that preceded the recent cut was the longest in India's history, suspending previous reforms that allowed prices to fluctuate in line with movements in global oil markets. Price controls on diesel and gasoline had been lifted in October 2014, but the government has frequently interfered with pump prices — especially prior to state and federal polls — through the country's state-controlled oil marketing companies — state-run firms, led by Indian Oil, control 90pc of India's fuel market. The two-year freeze began in May 2022, when international crude prices reached $120/bl following Russia's invasion of Ukraine three months earlier, sending Indian pump prices to record highs. Modi's government has also played some other familiar vote-winning cards. LPG subsidies have long been exploited by Indian politicians to win favour with voters, and the BJP increased these subsidies by more than fivefold in its 2023-24 budget — to $1.5bn from $273mn — to boost access to LPG and reduce cooking gas prices for poorer households. Around 322mn Indian households use LPG, but domestic consumption has plateaued at around 28mn t/yr in recent years. LPG subsidies have been maintained at $1.5bn in the 2024-25 budget. The extra funds announced last month enabled the government to extend by one year, to April 2025, a Rs300 ($3.60) LPG cylinder subsidy for poor households, in addition to implementing a general Rs100 price cut for a 14.2kg LPG cylinder to Rs503. Access to LPG has already been vastly expanded by Modi's Pradhan Mantri Ujjwala Yojana programme for women in poorer households, launched during his first term in 2015. The scheme has enabled 100mn poor, rural households to secure access to LPG, helping them switch away from harmful biomass such as wood and reducing the incidence of respiratory disease among rural women. The LPG subsidies are aimed at the rural poor, but Modi's government is framing its enthusiastic support for ethanol and biofuels to woo a different constituency — farmers in the politically powerful states of Uttar Pradesh, Maharashtra and Karnataka. New Delhi is promoting ethanol for blending with gasoline and has set a 20pc blending target by 2025. This move could improve India's energy security and trade balance by reducing its dependence on imported crude, which meets around 88pc of its crude needs. The government estimates it saved $2.7bn by blending ethanol into gasoline in 2021-22, and blending in the three months to January 2024 reached 11pc. But more importantly, particularly with an election looming, biofuels are additional sources of revenue for both farmers and distillers. Ethanol in India is derived primarily from sugar cane, which makes it politically sensitive. India's sugar cane industry is the second-largest in the world after Brazil, and sugar cane farmers are an important voting block — Uttar Pradesh and Maharashtra are the biggest producing states and played a major role in Modi's re-election in 2019. Farmers in these states previously faced regular late payments from sugar distillers, to the tune of hundreds of millions of dollars outstanding. But the additional income that sugar mills now generate from ethanol has allowed them to catch up on these arrears, oil minister Hardeep Puri says. The government has also promoted solar power to households, under a $9bn rooftop solar plan that aims to install solar panels in 10mn households. New Delhi is offering a 60pc subsidy on the entire system cost, with loans available to cover the balance. The proposed scheme may add 30GW of solar power capacity through residential rooftop solar panels, an area where India has lagged behind. Longer-term costs The current focus on voter-friendly energy policies comes at a cost. Longer-term objectives relating to energy security — specifically strategic petroleum storage — energy transition and foreign investment have received less attention. Budget allocations to state-run oil companies for energy transition investments have been halved in the current fiscal year, to $1.8bn, and actual disbursement of these funds has been postponed until the 2024-25 fiscal year. The government in November scrapped its plans to buy $603mn of crude to fill its strategic underground storage, after providing for such outlays in the 2023-24 budget, and it has not made any allocation for refilling strategic stocks in its 2024-25 budget. New Delhi is also facing delays in building the 6.5mn t second phase of its strategic petroleum reserve, owing to challenges with funding and the potential role of foreign partners. It initially wanted to build the reserve on its own but subsequently sought third parties to help with funding. It has now invited bids to build India's first commercial strategic storage, comprising 2.5mn t of underground storage at Padur in Karnataka at a cost of $700mn, with state-controlled Saudi Aramco and the UAE's state-owned Adnoc. Discussions begin this week. India will need to resolve and make progress on these issues, given its aspiration to join Paris-based energy watchdog the IEA, whose rules stipulate that members must hold strategic oil stocks equivalent to 90 days of net imports. The Indian reserve's first phase offers 5.33mn t of storage capacity across three sites, equivalent to only seven days of crude demand, government documents indicate. On foreign investment, India's demand potential is helping attract investors to green energy, to the tune of $6bn over April 2020-September 2023, power minister RK Singh told the Indian parliament in December. But the country's chronic inability to lure investors into oil and gas remains a problem, particularly in light of Modi's ambitions of making India an economic superpower to rival China. Foreign investment in India's oil and gas sector reached a record $806mn in 2019-20, before the Covid-19 pandemic, oil ministry data show. But it plunged to just $56mn in 2021-22 and to $108mn in 2022-23, representing a nugatory 0.2pc of total foreign direct investment flows into the country. Foreign investment in exploration totalled just $16mn in 2022-23, while investment in refining was nil. Indian ethanol blending FDI in Indian oil and gas Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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