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    US to Continue Energy Exports under Biden: Analyst


There is too much at stake in terms of foreign policy, says think-tank Atlantic Council.

by: William Powell

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US to Continue Energy Exports under Biden: Analyst

The US will continue exporting LNG and energy generally if Democrat candidate Joe Biden wins this November's presidential election, according to the director of the Washington, DC based think-tank Atlantic Council's global energy centre, Randolph Bell.

He told a webinar arranged by Singapore International Energy Week July 22 that the foreign policy goals of energy exports, and the benefits to the climate of coal substitution with gas, were too great for the US to pass up. "There is no chance of an export ban," he said.

The Democrats have made strong policy statements against hydraulic fracturing, which has underpinned the shale revolution, and some projects will be harder to develop if Biden is in the White House. But Biden himself is a pragmatist, Bell said. "He has adopted the best policies from the Left and promised major investments in technology, but these do not exclude carbon capture and storage and nuclear."

Bell did not comment on whether Biden or Donald Trump was more likely to win the presidency in November.

He added that the Republicans would have to develop a climate strategy if they were to retake the House of Representatives: "The young people want it," he said, and the Republicans are making progress on this.

Just as coal-fired power generation has been replaced by ever more gas-fired generation for reasons of economics, the market has decided the fate of LNG exports this year: a sharp fall in prices has wiped out the profits of Henry Hub-priced LNG. Accordingly there have been many cargo cancellations in the last few months, as traders saw Europe's leading hub, the Dutch Title Transfer Facility, dip even lower than the US spot benchmark.

A speaker from market reporting agency Platts, which devised the widely-accepted Japan Korea Marker for month-ahead LNG sale and purchase contracts, expects spot prices to rise only modestly this year and next in Asia, maybe doubling to just $4/mn Btu.

The International Energy Agency, also presenting, said this year would see a contraction of 4% in global LNG demand, against a 6% contraction in the world's gross domestic product. This was behind the crash in spot prices, which had been softening even before the Covid-19 lockdowns. There are also other reasons for weaker demand, such as Japan using more nuclear energy at the expense of its gas-fired generation capacity.

The Atlantic Council is a foreign policy think-tank and Bell's department is focused on energy security and sustainability issues: how countries balance their political goals of firm energy supply with the objectives of the Paris Agreement.