Welcome to the ODAC Newsletter, a weekly roundup from the Oil Depletion Analysis Centre, the UK registered charity dedicated to raising awareness of peak oil.

Another week, another oil price record. As ODAC went to press, WTI crude was trading around $105, having hit $105.97 on Thursday. That’s a new all-time high, not just in nominal terms but also inflation-adjusted, according to reports this week.

The fact that the inflation-adjusted record set in 1980 has now been broken is interesting because it took a surprisingly long time coming. As recently as June last year, the BP Statistical Review gave the inflation-adjusted peak, established at the outbreak of the Iran-Iraq war, as $90 in today’s money. But as the nominal price has soared in recent months, in press reporting the inflation-adjusted record has risen even faster, retreating like a mirage in the desert, always just out of reach. Until now, that is. To unravel this mystery, this week we have incisive commentary from Bob Wendling of MISI.

As for the reason why the oil price continues to rise, you pay your pundit and take your choice. As usual OPEC blames speculators, and some market watchers blame the weak dollar. No doubt these factors play a part, but more significant would seem to be OPEC’s decision to leave output unchanged, provoking impotent protests from Washington, and rising border tension between Columbia, Ecuador and Venezuela. Between them the three countries produced almost 4 million barrels per day in 2006 (BP Stats).

A research note from stockbrokers Goldman Sachs argues that the oil price rise is being driven by industry cost inflation – which Exxon acknowledged as one reason for its soaring exploration and production budgets and why the oil majors generally continue to struggle. ODAC trustee Jeremy Leggett points out this week that production is falling at all of the super-majors except Total. Elsewhere it was reported that oil discoveries in deepwater Gulf of Mexico have fallen. No wonder the majors are jostling for deals in Iraq.

One of the most interesting articles this week comes from Faith Birol, chief economist of the International Energy Agency. Although the IEA continues to insist that peak oil will not happen before 2030, the Agency does predict a “supply crunch” around 2012-2015, and Birol’s warnings have become increasingly urgent. Last year he told Le Monde that the only thing that could prevent the predicted supply crunch was an “exponential” increase in oil production from Iraq – which still seems highly unlikely, despite improvements in the security situation. This week he argues that we must leave oil before it leaves us, and that “even though we are not yet running out of oil, we are running out of time.”

Perhaps what is running out of time quickest is the IEA’s optimistic long term oil production forecast. It depends in part on oil resource estimates from the United States Geological Survey (USGS) that are arguably over-inflated by about 500 billion barrels. However the IEA is now reviewing its reliance on the USGS data, and this ought to lead to a major downward revision in its forecast when its next World Energy Outlook is published in the autumn.

In the gas market, this week’s deal between Russia and the Ukraine looks more like a ceasefire than an armistice. In coal, the supply crisis has spread to Indonesia, now suffering blackouts despite being the world’s biggest thermal coal exporter, and China plans to reopen 10,000 coal mines that had been closed on safety grounds to cope with fuel shortages.

In the UK, it was a busy week for news on energy policy, but with achingly little progress. The good news is that the government is apparently considering feed-in tariffs – finally! The bad news: only for micro-generation rather than all renewables.

Meanwhile, Gordon Brown revealed a shaky grasp of environmental priorities by bending to the Daily Mail’s campaign against plastic bags and growling at the supermarkets. All well and good, but as the climate hurtles towards tipping points and peak oil bears down – is this really the best use of his time? He might have done better to read Roger Bentley’s comprehensive, three-part demolition of Peter Odell’s recent Guardian piece – which concludes here this week.

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Oil hits record near $106 on weak dollar, OPEC
Oil Tops Inflation-Adjusted Record Set in 1980
EU’s Piebalgs says oil could hit $200/b, urges clear OPEC policy
Washington slams Opec decision
Non-OPEC Oil Production Likely to Disappoint Over 2008, Analysts Say
Deep Gulf finds slacking off
ExxonMobil capital costs to soar by 20%
Goldman Sachs: Forget The Funds, It’s Project Costs Driving Oil
Iraq contract talks near completion
The crude fact
We can’t cling to crude: we should leave oil before it leaves us

Putin steps in with deal to end Ukraine gas supply crisis
Chinese delegation to sign major gas deal in Iran soon

Coal-hungry China to reopen 10,000 mines: state press
Lump Sums
Recent electricity blackouts: The coal paradox

EON Gives In to EU Pressure, Sells Power Network

Hutton’s nuclear future for UK power
Minister admits nuclear fuel plant produces almost nothing

Through biofuels we can reap the fruits of our labours

Medvedev signals hardline intent
Oil money is coming – and there is little the west can do about it
China Says $16 Billion Iran Gas Agreement Is a ‘Commercial Act’

Sweden to Accelerate Global Warming Gases Cuts, Minister Says
‘Enjoy life while you can’
New US climate offer ‘too little’

Government backflip on solar panel policy
Energy firms tell Treasury: don’t bring in windfall tax
Energy suppliers in talks to help 4.5m struggling families afford fuel bills
PM warns stores over carrier bags

ODAC Guest Commentary: Dr Roger Miller
Reports of the oil industry’s imminent death are greatly exaggerated