[Kabar-indonesia] Asian gasoline declines on lower Indonesian, Mideast demand [+LNG market]

[JoyoNews at aol.com]

also: Chevron predicts 'tight' LNG market for 5 years as demand rises 

Asian gasoline declines on lower Indonesian, Middle East demand 

SINGAPORE, June 29 (Bloomberg): Asian gasoline prices have fallen because of 
lower demand for the fuel from Indonesia, Asia's biggest importer, and the 
Middle East.

Prices of 92-RON gasoline in Singapore, an Asian benchmark, have fallen 9 
percent from the May 15 record US$90.55 a barrel. Brent oil prices have gained 3 
percent in the same period.

Gasoline's price premium to naphtha, a crude product that can be made into 
auto fuel, has fallen 53 percent from its May 15 record of $25.60 a barrel, 
according to Bloomberg data.

Higher retail prices have cut demand for the fuel in Indonesia and Iran, the 
biggest buyers in Asia and the Middle East, as motorists cut consumption. 
Indonesia was forced to raise gasoline prices last year after record crude oil 
prices made state subsidypayments unaffordable.

"Indonesian imports have been unpredictable since the fuel price increase 
last October," said Akira Kamiyama, who trades the fuel for Tokyo-based Mitsui & 
Co., " Erratic Indonesian demand continues weigh on prices."

Demand in Japan, Asia's largest gasoline market, has fallen as motorists 
shunned pump prices that rose to 136.0 yen a liter ($4.43 a gallon) in the week 
ended June 26. Higher costs for motorists may cut gasoline sales, which fell for 
the first timein 21 years in 2005, for a second year.

Middle Eastern gasoline imports have dropped about 7-8 percent in the second 
quarter from the first quarter as Saudi Aramco and Kuwait Petroleum began 
operating the new gasoline- making plants, said Mumbai-based oil trader S. 
Raghunath at Trafigura AG.Iran's $4 Tank 

Iran, the second-biggest oil producer in the Organization of Petroleum 
Exporting Countries, imports more than a third of thegasoline it uses, about 188,000 
barrels a day. Subsidies ensure Iranian drivers pay the equivalent of $4 for 
a 40-liter tank of gasoline.

The country's gasoline demand has grown at 15 percent a year as waste, a lack 
of refining capacity and smuggling have boosted the oil producer's fuel 
imports, th e Paris-based International Energy Agency said in the April issue of 
its monthly report.

The Middle East, the world's most oil-rich region, imports gasoline because 
of a shortage of refinery capacity. Consumption exceeds output by 195,000 
barrels a 
day last year, according to data compiled by energy consultant Purvin & Gertz 
Inc.  

----------------------------------

Chevron predicts 'tight' LNG market for 5 years as demand rises 

BEIJING. June 29 (Bloomberg): Chevron Corp., the second-biggest U.S. oil 
company, said the next five years are likely to be an "historically tight" period 
for liquefied natural gas, with supplies limited through at least 2011 as 
demand surges.

Increased global LNG use and the delayed start up of projects are deepening 
shortages of the fuel, favored as a cleaner-burning alternative to oil and 
coal, said Steve Del Regno, Chevron's regional manager for gas business in Asia.

Chevron and its partners are developing the US$10.4 billion Gorgon LNG 
project offshore of Australia, the costliest project the San Ramon, California-based 
company has anywhere in the world. Chevron is counting on Gorgon and LNG 
projects in Angola, Nigeria and Venezuela to quadruple output to 11 million metric 
tons a year by 2010.

"We wish we had more LNG to sell," Del Regno said in a telephone interview 
from California on Wednesday. "This happens to be an historically tight period. 
Most people would agree that in the next five years, it would remain" that way.

China, the world's biggest energy user after the U.S., wants to boost the 
share of its energy produced from natural gas to 8 percent by 2010 to cut 
pollution and reduce the country's reliance on coal and crude oil. Rising demand in 
the Atlantic Basin region, led by the U.S. and Europe, means that market may 
match the size of the Pacific market by 2015, Leigh Bolton, director of 
Consensia Ltd., a U.K. consulting firm, said June 22. 

"New terminals are coming up in China, Mexico and Taiwan," L.C. Hicks, senior 
vice president of business development at BP China, said in Shenzhen on 
Wednesday. "Competition between existing buyers is definitely intensifying. From 
2002 to 2004, it was a buyers' market. Today it's a sellers' market."

Royal Dutch Shell Plc's $20 billion Sakhalin-2 LNG project in eastern Russia, 
BP Plc's Tangguh venture in Indonesia and the Gorgon project are among 
planned production in Asia running behind schedule. Costs are rising for equipment, 
materials andmanpower.

"Gorgon has officially told our buyers in Japan that it'll be difficult for 
us to stay on the 2010 schedule," Del Regno said. 

"We're now looking at a mid-2011 start up. All projects are under pressure, 
under costs and schedule pressure."

Chevron is operator and owns 50 percent of the Gorgon project. Exxon Mobil 
Corp., the world's biggest oil company, and Shell, Europe's second-largest oil 
company, each own 25 percent.

Chevron has committed 4.2 million tons a year of its share of the Gorgon 
project to three buyers in Japan and has yet to identify buyers for the remaining 
annual 800,000 tons of the fuel, Del Regno said.

Chevron is the third-biggest natural gas producer in the U.S., behind BP, 
Europe's biggest oil company, and Exxon Mobil, according to the Natural Gas 
Supply Association in Washington.

LNG is natural gas that has been cooled to shrink it for shipment across 
oceans on tanker ships. The fuel is warmed when it reaches its destination so it 
can be pumped into homes and businesses on pipelines. 

------------------------------------------
Joyo Indonesia News Service
------------------------------------------