UK energy woes

[james03]

On the natural gas side, looks like Putin is playing hard ball over the Nordstream 2 pipeline.  I don't blame him, you spend billions laying a huge pipeline to Europe, then have to deal with a bunch of political crap.  The Russian mentality must get seriously ticked by this.  "We'll teach these idiots a lesson".  So the Russians cut back to their contract volumes and no longer sell additional volume into the spot market.  Natural gas prices have shot to the moon as a result.  I predict Nordstream will come on line soon.

Interestingly a side problem is the loss of CO2 production.  CO2 is a major byproduct of ammonia production, and CF shutdown a 2 plants in the UK due to high gas prices.  The UK is now paying CF to restart the plant. https://www.zerohedge.com/commodities/uk-strikes-emergency-deal-c02-producer-restart-operations-amid-shortage  So on one hand, the UK is spending tons of money on Green subsidies to cut CO2 emissions, and on the other hand, they are subsidizing production of CO2.  Government.

Another story, the UK is short of diesel and gasoline.

https://www.zerohedge.com/commodities/bp-prepares-ration-gas-uk-service-stations-amid-supply-woes

The claim is a lack of truck drivers.  That smells kind of fishy.  And this statement in the article is very ambigous:  " BP had two-thirds of fuel stock levels required for normal operations."  What fuel stock levels?  Levels at the local stations? or did you all screw up and not make enough or import enough?  Cut back refining due to natural gas prices?  I don't know if the UK produces 100% of their fuels or if they import barrels.  I suspect there is more to this story.  Where did these truck drivers go?  How about giving them a 20% raise?  This shortage is fishy.

She expects fuel stocks to stabilize and began rebuilding in October

Really.  And why is that?

And of course there is the cost of power.  That is skyrocketing.  Going to be bad this winter.

[MaximGun]

Saw this coming.  Collected lots of wood this summer for stove.

[james03]

Why do stocks stabilize then magically build in October?  My best guess is they held off on imports due to price and are now out rushing to find barrels.  So you hedge on the upside, but don't buy actual barrels.  This is a good way to goose 3rd quarter paper profits.  Basically they made money on the hedges, but didn't do the counter buy of actual.  Now they have to buy quickly at higher prices. 

Kind of far fetched, but the story doesn't make a lot of sense.