The ASX has rallied on the back of energy stocks, gaining 0.21% or 14.40 points after yesterday’s bloodbath to climb to 6,843.00.
Most other sectors are still in the red, but Energy gained 3.61% as a stirring Chinese economy applied pressure to oil and gas forecasts. Other sectors in the green were Financials, up 1.12% and Industrials, up 0.39%.
The top-performing companies were unsurprisingly coal stocks, with Coronado Global Resources Inc – a metallurgical coal company – gaining 8.85% and New Hope Corporations Ltd – an oil, gas and agriculture company – rising 6.01%.
The index has been largely unchanged over the last five days but is down 8.07% for the year to date.
In the news
Crude oil demand expected to climb
The International Energy Agency (IEA) has raised its estimates for global demand growth in oil for this year by 380,000 barrels per day, stating that “gains mask relative weakness in other sectors”.
The agency has also revised its 2022 forecast to 99.7 million barrels a day and its 2023 forecast to 101.8 million barrels per day, indicating prices may continue to rise next year.
“Natural gas and electricity prices have soared to new records, incentivising gas-to-oil switching in some countries,” The August Oil Market Report stated.
“With several regions experiencing blazing heatwaves, the latest data confirm increased oil burn in power generation, especially in Europe and the Middle East but also across Asia.
“For now, a deteriorating economic environment and recurring COVID lockdowns in China continue to weigh on market sentiment.
“Nevertheless, world oil demand is forecast to grow by 2 million barrels per day in 2022 and 2.1 million barrels per day next year. Jet fuel dominates growth, while road transport demand wanes.”
The report cited building global inventories as a reason prices may stabilise but could not discount a further price rally due to an increasing risk of supply disruptions.
EnergyConnect Riverina transmission line approved
The NSW Government has given planning approval for the eastern portion of a 900-kilometre energy transmission line set to be built through the Riverina region in the south of the state, intended to connect South Australia, Victoria and New South Wales.
Energy shortages earlier this year brought a severe lack of energy infrastructure between the states into the limelight, as each state was forced to go it alone and negotiate separately with their energy markets – to varying degrees of success.
Developer Transgrid claims the transmission line would be able to supply 8% of NSW’s electricity needs.
"We are building the energy superhighway," Transgrid CEO Brett Redman said.
"The interconnector will enable sharing of energy between NSW and South Australia and Victoria for the first time, enable the integration of renewable generation and help the federal government achieve its climate change targets."
A map of the proposed EnergyConnect transmission line between South Australia, Victoria and NSW.
The NSW portion of the transmission line would run from Wagga Wagga to Buronga and beyond if approved for construction by the federal government but has been met with resistance from local stakeholders.
Earlier this year, 42 objections to the project were lodged with the NSW Department of Planning, which successfully prompted a re-imagining of the energy highway to avoid wetland areas in the Riverina.
Map of eastern section of proposed transmission line (purple with blue points of use) including Tier 1 (orange) and Tier 2 (red) constraints to development, which consider social, environmental and land use considerations, network resilience and cost.
The project is expected to generate some 1,500 jobs in regional NSW and could be a vital component of energy infrastructure necessary to decarbonise the Australian economy.
The Five at Five
Sipa Resources readies to drill Skeleton Rocks lithium targets
Sipa Resources Ltd (ASX:SRI)’s aircore program earlier this year confirmed the existence of anomalous lithium in previously untested greenstone units and the targets identified will now be drilled with a reverse circulation rig.
Read more
Caspin Resources plots aggressive multi-rig campaign at Serradella as re-assaying reveals high-grade rhodium
“The results of the past few months have proven to be a breakthrough for the project and provide us confidence to embark on an aggressive drill campaign through the summer season," Caspin Resources Ltd (ASX:CPN) chief executive officer Greg Miles said.
Read more
Kingston Resources delivers successive months of record gold production at Mineral Hill
“Production from the TSF Project has delivered sequential monthly gold production records in July and August, and we are pleased to see grade and recoveries improve as expected as mining moves deeper in the tailings facility,” said Kingston Resources Ltd (ASX:KSN) managing director Andrew Corbett.
Read more
Lithium Power International gets valuation uplift from Edison Investment Research
Lithium Power International Ltd (ASX:LPI) is advancing the Maricunga Lithium Brine Project in Chile, which is expected to produce 15,200 tonnes of lithium per annum over 20 years, delivering a net present value of US$1.4 billion at an 8% discount rate.
Read more
International Graphite achieves first product from pilot graphite micronising and spheroidising plant at Collie.
“This is a major step in developing our operating knowledge and systems in the graphite downstream processing industry, leading to building a team that will understand the operational needs of graphite processing,” said International Graphite Ltd (ASX:IG6) executive chair Phil Hearse.
Read more
Read more on Proactive Investors AU
