Energy consumption – Aug 24

August 24, 2007

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Fuel price policy explodes in Myanmar

Larry Jagan, Asia Times
Public protests have broken out across Myanmar’s old capital Yangon after the military government unexpectedly removed fuel-price subsidies, resulting in a 500% spike in rationed fuel prices.

The shock policy is part of the government’s emerging economic and financial reform program and notably coincided with a high-level mission to the country of International Monetary Fund (IMF) and World Bank officials, who have long pressed the junta to reduce or abolish a range of price subsidies.

The move has shocked the country’s already fragile economy and, depending on the eventual scale of the protests and severity of the government’s response, could have grave implications for political stability. Significantly, the spiraling acts of civil disobedience have been led by former political prisoners known as the 88 Generation Students Group, who nearly 20 years ago as student leaders led the pro-democracy demonstrations the junta cracked down on with an iron fist in 1988.

Myanmar’s ruling junta, known as the State Peace and Development Council (SPDC), has for decades maintained strict social controls – though security forces have loosened their grip in certain areas of Yangon since abruptly moving the national capital to a newly built city known as Naypyidaw in November 2005. The numbers joining the marches has grown since. More than a hundred people joined the first demonstration on Sunday demanding that the government intervene to lower fast-rising fuel and food prices.

More than 300 people took to the streets to protest on Wednesday, according to witnesses, and news reports indicate the rallies continued on Thursday. The junta has responded through stick-wielding vigilantes, including members of the pro-government Union Solidarity and Development Association. Some protesters have been beaten and whisked away in unmarked cars, according to witnesses who spoke with Asia Times Online.

“The government has raised fuel prices without giving any prior notice, and due to this hike, all the people are suffering,” said one protester at Sunday’s march.

…There are preliminary indications that the subsidy policy is seizing up the economy. Prices for compressed natural gas, which the government had in recent years promoted for use in commercial vehicles, have increased fivefold, while the price of basic commodities has skyrocketed in line with the higher transportation costs. Bus fares and taxi charges doubled almost immediately in urban centers such as Yangon, Mandalay and Moulmein, resulting in drastically reduced passenger loads.

According to a Yangon-based financial analyst who requested anonymity over concerns of possible government reprisals, the increase in bus fares will disproportionately affect the urban poor.
(24 August 2007)


African giant continues to stagger

Anene Ejikeme and Char Miller, The Record (Ontario, Canada)
Nigeria is suffering from a power vacuum, a reflection of its less-than-energetic economy.

Yes, Nigeria is the “Giant of Africa.” Yes, its population is the continent’s largest; yes, its GDP is ranked second only to South Africa. Yet its claim to grandeur, and the demographic and economic data on which it rests, is suspect.

That’s because the country’s per-capita consumption of electricity is among Africa’s lowest: In 2004, Nigeria, with 140 million people, ranked 24th, sandwiched between tiny Lesotho (2.2 million) and middling Kenya (31 million). Nigeria looks like a rather underpowered giant.

Its future appears no more robust than its current state; without electricity, its people and their productivity will continue to lag.

Households have proved especially vulnerable. This summer, for instance, the ubiquitous fuel shortage was exacerbated by a general strike. Families were forced to seek gasoline for their generators on the black market, an action best done during the middle of the night and in out-of-the-way locations. The time and energy this required made it as impractical as it was dangerous.

Worse, costs soared. A single family, were it fortunate to own a generator and be able to locate a steady stream of fuel to operate it 24 hours a day for a year, would spend upwards of $7,200 — that’s 10 times Nigeria’s per capita annual income.

No wonder Nigerians do without power most of the time.
(23 August 2007)


Elderly scrimp to get by

Laura Anderson, Adelade Advertiser
OLDER South Australians cannot afford a healthy diet and are reluctant to use their electric and gas heating because of the cost, a parliamentary inquiry has heard.

Pensioners also are having to “scrimp” to take their grandchildren out or see a film, the Aged Care Lobby Group says.

In a submission to a Senate inquiry into the cost of living pressures on older Australians, the lobby group says high supply charges for gas and electricity are making pensioners “reluctant to use their electricity and gas fires because of the cost”.

“Given that prices in the supermarket rise every week, with high prices for meat, fruit and vegetables . . . a good diet is very hard to fund,” the lobby group says in its submission.

“Petrol costs are astronomical. Whilst many make full use of the four-cents-off vouchers, these are more supermarket window-dressing than cost-savers.”
(24 August 2007)


Rosneft Buys Local Crude Oil

Reuters via Moscow Times
State-controlled oil firm Rosneft has appeared for the first time on the local free crude oil market by buying volumes to increase processing at its refineries, trading sources said Wednesday.

The sources said Rosneft bought around 200,000 tons of crude from the country’s No.4 oil firm Surgutneftegaz for September delivery to its Samara group of refineries.

…Rosneft bought crude as global prices fell while export duties, which are revised only once every two months, remain high, making crude oil export operations less profitable than domestic refining and subsequent exports of refined products.

“In the current environment, it is more profitable to sell crude on the local market than to channel it for exports,” said a trader with a Russian company.
(23 August 2007)
Contributor Jeffrey J. Brown writes:
I wonder if the recent Russian increase in oil export duties serves two purposes: (1) To raise more money from recently declining oil exports and (2) To serve as an excuse for declining oil exports.


China Crude Imports Up 39% in July, LNG Imports Up Fivefold

Interfax-China via Resource Investor
China’s General Administration of Customs confirmed preliminary data released earlier this month that showed the country imported 39.3% more crude oil in July than it did in the same month last year, and that liquefied natural gas (LNG) imports soared fivefold in order to meet robust energy demand during the country’s peak summer consumption season.

China’s crude oil imports in July hit a record monthly high of 14.83 million tonnes, equivalent to 3.51 million barrels per day, which brought the total volume of crude imported from overseas so far this year to 96.37 million tonnes, up 14.7% year-on-year.

At the same time, the country exported 81.7% more gasoline during the first seven months than it did during the same period last year, while light diesel exports fell 29% year-on-year.
(22 August 2007)


Tags: Energy Policy, Fossil Fuels, Oil