TPT September 2017

G LOBA L MARKE T P L AC E

Is allocation in sight? A review by The Fabricator indicated that US mills are anticipating allocation measures, with mills “vowing” to protect current and loyal customers, rather than “bump them out” in favour of new customers willing to pay the higher spot pricing. The vice president of a large US-based service centre responded: “I find this disturbing, as 232 is yet to be announced, and the mills are already talking allocation language. Almost like the mills were tipped off on what is coming?” Allocation could leave a steel-buying and using company unable to get the steel it needs. The Fabricator commented: “Steel buyers are also potentially in jeopardy whenever the US government gets involved with picking winners and losers.” The form that sanctions against imports might take is still an unknown, with educated guesses ranging anywhere from a 30 per cent tariff to a trade rate quota (TRQ) system. Steel Market Update’s prediction is that Commerce Secretary Wilbur Ross will recommend a formula for determining the “normal” level of imports, put a collar around that average and subject imports that exceed it to a very high tariff. Picking the appropriate time period for the TRQ formula will be politically and emotionally charged. If the time period is a five-year average, with the suggestion being prior to the surge in imports in 2014-2015, then we may be looking at the years 2009-2013. Yet, due to the prolonged recession, 2009-2010 were two of the worst years for both the international and domestic steel industry. Many in the industry believe restricting foreign steel is a bad idea, including manufacturers that rely on foreign steel, ports that handle foreign steel, logistics and trading companies that support foreign steel, and even certain segments of the government. This summer will also see the start of a one-year review of the anti-dumping and countervailing duty trade cases on corrosion-resistant, cold-rolled and hot-rolled steel. The steel industry continues to live in interesting times.

reliable supplier of energy to all corners of the world.” Sada spoke at the World Petroleum Congress in Istanbul. S&P Global Platts Analytics reports that Qatar is the world’s largest LNG supplier, having exported 78.8 million tonnes of LNG in 2016, over 30 per cent of global supply of 257.8 million tonnes, with an increasing share of its production delivered to emerging Middle Eastern buyers, including Egypt and the UAE. Sada assured the conference that the blockade would not have a wide impact as: “Total exports in trade to Saudi Arabia, UAE and Bahrain account for less than 8 per cent” of its total global trade, continuing that total trade flows of energy to Japan, India, South Korea and China – the main centres of oil demand growth – account for three quarters of its exports, and trade to these nations “remains unchanged”. The countries accuse Qatar of supporting terrorist groups and seeking to undermine regional stability; all claims that Qatar strongly denies. Pipeline to Mexico Oil & Gas Journal ’s Washington editor writes that NuStar Logistics LP has received approval from the US Department of State to construct a 108,000-barrel-per-day pipeline to Mexico. The system will cross the US-Mexico border near Penitas, Texas, carrying oil products. President Donald Trump mentioned the project in his energy policy reforms address on 30 June. The 10" Burgos pipeline will parallel an existing line already in operation, and will use the same right of way between NuStar’s Edinburg, Texas, terminal and Petroleos Mexicanos’ gas plant near Reynosa, Tamaulipas. NuStar also received cross-border permits for the existing Dos Laredos and Burgos pipelines, authorising transportation of a broader range of petroleum products. Energy bills On 28 June, the US House Energy and Commerce Committee approved three bills aimed to establish realistic ground-level ozone limit implementation schedules, facilitate interagency reviews of proposed natural gas pipelines, and to create a process to review applications for cross-border gas pipelines and electricity transmission lines. HR 806, introduced by Energy Subcommittee vice-chairman Pete Olson, cleared the full committee by a 29-24 vote. It will grant more time to states that have not yet implemented 2008 National Ambient Air Quality Standards, without triggering penalties for failing to meet the current schedule. The committee also passed, by a 31-20 vote, HR 2883 to promote cross-border energy infrastructure, introduced by Oklahoma Republican Markwayne Mullin.

Oi l and gas Qatar blockade

Qatar energy and industry minister Mohammed al-Sada has said that the current economic and diplomatic blockade imposed by Saudi Arabia, Egypt, Bahrain and the UAE will continue to have a limited impact on its oil and gas trade. He explained that Qatar: “Has never failed a single shipment and has not compromised on its long-standing image of being a

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SEPTEMBER 2017