Chapter 1: What is the main topic discussed in this episode?
ABC Listen. Podcasts, radio, news, music and more. Welcome to Fuelcast. I'm Carrington Clark and this is your source to stay on top of the numbers behind the ongoing energy crisis. It's Friday, May the 8th. We're recording mid-morning. Let's have a look at the figures. The price of Brent crude has dropped to US$103 a barrel since we last checked in.
The national average price of unleaded has risen by $0.01 to $1.86 per litre, and the national average price of diesel has dropped by $0.10 to $2.50 per litre. Today, I'm joined by Ian Verinder to dig into the major energy headlines. Good morning, Ian.
Chapter 2: What is the new gas reservation policy introduced by the government?
Morning, Carrington. How are you?
I'm very well, thank you. Happy Friday. When we spoke last on ABC Business Daily this week, it was about the government's fuel resiliency plan announced ahead of next week's budget. Yesterday, the government unveiled another energy policy, and that is an East Coast gas reserve, which will force major gas companies to save
20% of the export volumes for the Australian market, and that's set to go into effect in the middle of next year. Ian, you've been writing and talking about the differences between the East Coast and the West Coast when it comes to gas reservation for a long time. What do you make of what the government has announced so far?
Well, the policy that was announced yesterday is really – well, a bit of backtracking here. Late last year, the government announced a gas reservation policy, and it was going to take quite some time to work through the details of it. So the timing is a little bit odd. I mean, we've got a federal budget out next week, and we've had, I guess, a really –
quite strident debate about gas taxing just in the past few weeks as well. So it would appear to be a bit of a, I guess, heading off at the pass strategy by the government to try and bring in something that, you know, placates everybody in this argument.
The details of this scheme have yet to still be properly worked out and I don't think it's going to be put in place until midway through next year now. Now originally it was supposed to be in place early next year so it's actually been delayed by around about six months. The problem here is that there are three gas exporters on the east coast.
You've got one that's led by Origin, you've got another one that's led by Shell and a third one that's led by Santos. Now The Origin and Shell Lead Consortia both provide gas into the East Coast system. It's the Santos Export Consortium that does not, because the problem is that Santos miscalculated the amount of gas that it could access in the ground.
It built a facility that was too big for the gas that they had access to. And then they wrote export contracts off the back of that very large export facility to be able to pay for it. And of course, what happened was they didn't have enough gas. So what the Santos Consortium does is that it buys gas out of the domestic system.
And that is why we've had these problems with gas, if not outright shortages, squeeze supply, at least, you know, on the East Coast.
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Chapter 3: How does the East Coast gas reserve impact Australian consumers?
Thanks, Keratin. See you later.
You can catch That's Business with Alan Kohler in your feeds later today, where he'll be chatting to the head of one of Australia's major food manufacturers, Bega, on the impact of the global energy crisis on food manufacturing, on how Ozempic has changed how we consume food. and if he thinks the push to limit migration is good for business.
That's in your feeds at 3pm today on ABC Listen or wherever you get your podcasts. And we'll be back in your feeds with all things Fuel next week. Bye, Ian. See you, Carrington.