Woodside Energy refuses to hold gas supply amid complaints from consumer groups and politicians

Woodside, Australia’s leading oil and gas producer, said it was not withholding supplies of gas from the market, amid criticism from consumer groups and politicians.

In an interview with ABC Radio, Woodside executive vice president Mark Abbottsford dismissed the notion that his company is throttling supply from the market.

“There is no available supply that we are withholding” He said.

“We are putting every molecule we can into the market.

Consumer groups accuse producers of gas withholding

Consumer groups have previously complained that gas producers were acting like bullies because they refused to supply gas to retailers.

“The gas industry still appears to be acting like a bully, effectively withholding supplies.” Andrew Richards saidthe CEO of the Energy Users Association of Australia, gave an example of a large gas customer failing to receive an offer five times.

“We will only withhold supply if we have market power.”

That’s because gas prices for homes on Australia’s east coast have risen significantly since February, with major retailers expected to raise prices by an average of 20%.

Epoch Times photo
The Cossack Pioneer oil production facility at Woodside, off the northwest coast of Australia. (AFP via Getty Images)

Abbottsford agreed that current prices are high for consumers, but said many factors were involved, including producers, wholesalers, distribution and the industry as a whole.

“What we can do to mitigate that as producers is get additional supplies into the market,” he said.

At the same time, Abbotsford said he would like to see prices at sustainable levels in the gas market as it gives more certainty to the direction of investment.

But he was also concerned that the 12-month price cap implemented by the Labor government would curb gas supplies and create a second problem.

Government defends price cap

Despite the sharp rise in prices that fell on consumers’ shoulders in February, Energy Minister Chris Bowen said the government’s policy was backfiring because the price cap would take time to be reflected in retail prices. said no.

“Another way was to eat away at the profits, to keep the wartime profits going, and to make Australians pay the international price of Australian gas within Australia.” He said ABC radio.

“We don’t let it happen. We didn’t let it happen. The changes we introduced last year are still flowing through the system.”

Furthermore, Bowen said the government’s analysis of the decline in gas prices in 2023 and 2024 remains valid.

“We made it clear at the time that our intervention would reduce the first year price from 20% to 18% and the second year price from 20% to 4%,” he said.

“And that analysis is valid.

Epoch Times photo
Chris Bowen, Labor Minister for Energy and Climate Change, speaks to the media at a press conference at the Houses of Parliament in Canberra, Australia, 16 June 2022. (AAP Image/Lukas Coch)

The minister also said that if the government did not take action, the Australian industry would shut down this year due to high gas prices.

On a different political spectrum, opposition leader Peter Dutton reiterated that price caps will not work.

“Otherwise, every time the price of watermelon spikes at Christmas, I would say put a cap on the price of watermelon or put a cap on the price of any commodity,” he said.

“It has only resulted in higher prices and greater uncertainty about market stability.”

Meanwhile, the Greens have called on the federal government to urgently introduce an interim code of conduct that will force energy providers to adhere to price caps.

Greens said the recurring and growing “cartel-like” behavior of the gas industry is why parts of the Code should be implemented immediately.

“The gas companies are trying to hold the country hostage, causing disruptions in the energy sector and anxiety among ordinary people who are already experiencing severe cost-of-living pain,” said Greens deputy leader. Mereen Falki said in a statement.

“The Labor government should ensure that gas companies cannot hide behind this excuse to cause chaos in the energy sector by arbitrarily withholding supplies and overcharging the country for their own gas. We must intervene immediately in the interim code of conduct.”

Alfred Bui

Alfred Bui is an Australian reporter based in Melbourne, focusing on local and business news. He is a former small business owner and holds his two master’s degrees in business and business law. Please contact [email protected]