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.
The OPEC meeting in Vienna this week brought two surprise announcements. The first that existing production quotas would now be enforced, leading to an overall reduction in output of approx 520,000 bpd. The second was that OPEC and Russia will be seeking closer ties, a situation which could result in a coalition controlling approximately half of the world’s oil.
The International Energy Agency report this week predicted worldwide demand of 87.6 million bpd in 2009, with OPEC output needing to be approx 31.8 million of this. The proposed OPEC cut would significantly tighten the supply/demand dynamic making the market vulnerable to any supply disruptions. It remains to be seen whether Saudi, in particular, is prepared to make the required reductions.
As US production continues to recover from the shutdowns necessitated by Hurricane Gustav, the threat of greater disruption in the largest area of refineries in the US due to the approaching Hurricane Ike is causing alarm. Oil prices have however continued to fall overall with continued focus on demand reduction due to the economic slowdown.
In the UK this week the government launched its long awaited fuel measures aimed at providing relief in the face of increasing energy costs. Responses to the package, which concentrates on assistance for energy saving measures, have been mixed. Energy conservation measures make sense and will benefit people in the long run. The huge rise in costs this year however, coupled with the possibility of further increases due to competition for gas this winter, in parallel with record profits for energy companies, had a lot of people expecting more. A situation which will not have been helped by Mark Owen-Lloyd, Head of Power Trading at E.On who was reported last night as commenting that “worst case scenario,” if prices remain high “it’ll make more money for us”.
Oil Falls, Gasoline Gains, as Ike Heads for Texas Refineries
Opec makes surprise cut to oil output
IEA Lowers Oil Demand Forecast as U.S. Curbs Spending
Opec plans closer links with Russia to control half of the world’s oil supplies
China marches past USA to stake a claim to Iraq’s oil
Sarah Palin taxes put pipelines in jeopardy, say oil giants
Brussels told to pursue Azerbaijan pipe dream
Big oil price swings caused by speculators: report
Lula’s new lucre: Brazil may keep full control of offshore oil
Britain is being outbid for gas on the global market, energy experts say
How methane could spark a revolution
Groups move to tap a different pipeline
Shell in Iraqi gas deal worth up to $4bn
Total Sees Gazprom as ‘Key’ Partner for Russian Energy Projects
Cleared: Jury decides that threat of global warming justifies breaking the law
‘India’s coal reserves may exhaust by 2040’
EU could halt energy demand growth, says study
Europe to reaffirm biofuels targets
Brown unveils £910m fuel measures
Big fall in customer bills unlikely
One in four ‘facing fuel poverty’
London borough offers free waste oil collections
Council push to buy bulk oil on futures market