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Thursday, March 24, 2011

Natural Gas Futures: Still Over $4.30 -- Supplies Down a Bit -- In Line With Expectations

CNBC, March 24, 2011, 10:30 a.m. EST.

That was posted earlier today. Now, 3:15 p.m. EST, I am posting this story:  Japan's requirements for fossil fuels will rise this summer as rebuilding moves into next phase. 
All four refineries of the ExxonMobil Japan Group are fully operational.

Meanwhile, undamaged refineries, such as JX Nippon’s Mizushima facility in Okayama Prefecture and Cosmo Oil Co.'s Yokkaichi refinery in Mie Prefecture, are expanding capacity.


According to the Petroleum Association of Japan, domestic demand for petroleum products totals 3.3 million b/d, and the industry soon should be able to meet most of that demand.

But that could change later this summer when the supply of electricity in the Tokyo area could fall as much as 15 million kw short of demand, about 25% of projected peak demand.

Tokyo Electric Power Co. (Tepco) is trying to fill the gap through by restarting an idle fossil-fuel power plant and repairing others damaged by the recent earthquake.

The government thinks such steps would help restore the region's power supply to 45 million kw—still be 25% less than the 60 million kw needed on the hottest days, when air-conditioning demand spikes. 
As noted in an earlier post, it's hard to say what's pushing the price of oil: Mideast tensions or Japan's rebuilding needs. It's obviously both and it will last longer than expected. 

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