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 of oil price records saw the latest milestone of $135/barrel reached, driving more talk of $200 oil. The oil price record happened despite news of a 300,000 barrel per day rise in production from Saudi Arabia which came in response to repeated requests from President Bush. As US politicians feel the pressure, the executives of the major oil companies were once again hauled before the Senate, and the House of Representatives demonstrated their desperation to find an easy scapegoat by passing an absurd bill that would allow the US to sue OPEC. Right, that’s solved it then.
The big supply story this week came from Iraq, where the deputy prime minister Barham Salih made the astonishing claim that Iraq’s reserves may be 3 times as big as originally estimated. Our Guest Commentary this week explains why this is highly unlikely. Even if true, it would be entirely academic given the daily violence in Iraq and continuing failure to agree a new oil law.
Anyone who was hoping that constraints on oil supply would be a good thing for fighting climate change should think again: Eni this week announced a tar sands project in the Congo; Gulf states are turning to coal as natural gas supplies in countries like UAE and Dubai are strained; and in the UK the energy companies met to coordinate on how to protect their coal expansion plans from the efforts of environmental demonstrators.
The UK government is increasingly feeling the heat as fuel costs soar. Both road and airports policy were roundly attacked this week. In parliament the Lib Dems questioned the fact that the government’s road policy is based on the astonishing assumption of $70/barrel oil in 2020, while a report by the Sustainable Development Commission questioned the assumptions of the airport expansion policy. Meanwhile road haulers are preparing a protest for next week. Energy Minister Malcolm Wicks speaking on BBC Radio 4 on Thursday put the problem down to ‘the perfect storm’ that no one could have predicted. The fact that this was predicted by peak oil theorists and by Goldman Sachs, was conveniently ignored.
Finally, the airlines are increasingly feeling the pain in the US and Europe. American Airlines announced that they are cutting flights, following BA’s similar announcement last week. Ryan Air admitted that it too was hurting.
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Oil
Oil hits $135 as rally accelerates
Solving the $130 oil conundrum
Saudi raises oil output to highest in two years after pleas from George Bush
Congress takes step towards Opec legal challenge
Oil exec: Prices driven by ‘fundamentals’
Iraq could have largest oil reserves in the world
Guest Commentary: Dr. Michael R. Smith – www.energyfiles.com
The announcement of large additional reserves by the Iraq Government does not appear to be backed up by new hard data. Although the country undoubtedly has very large volumes of unproduced oil it is impossible for the “reputable, international oil companies . . .” cited to be able – at a sweep – to triple available resources merely with the compilation of “recent geological surveys and seismic data”.
Eni finds oil sands deposits in Congo
Guest Commentary: Dr. Michael R. Smith – www.energyfiles.com
Although ENI have perhaps decided that the large deposits of oil sands located in Congo (Brazzaville) are viable as commerical developments these are unlikely to be new discoveries. There are numerous undeveloped oil sand outcrops known throughout the world which remain undeveloped due to the lack of a technological and financial solution. With much higher energy prices many of these are now being examined, albeit dogged by supply chain problems as costs escalate.
Nigeria demands $2bn oil arrears
Coal
Energy firms braced for summer of protests
As Oil Prices Rise, Nations Revive Coal Mining
Gulf states may soon need coal imports to keep the lights on
Biofuels
New Trend in Biofuels Has New Risks
Drax’s £50m renewables project throws biomass into the coal mix
UK
Hauliers plan London fuel protest
Road policy oil assumptions attacked
Put UK airport expansion on hold, demands green group
Transport
Oil price forces American Airlines to scrap 75 planes
BA descends as oil price gives cause for concern
Ryanair CEO says oil is hurting
Jazeera predicts revenues of $200mn in ’08
