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 hurricane in the Gulf of Mexico this week, which contributed to a drop in the US crude inventory of 6.3 million barrels, was overshadowed in the stock markets by the economic storm around the failure of Lehman Brothers and the bail out of AiG. Financial instability contributed to a rally in oil and commodity prices today, however fears of recession caused OPEC to revise their 2009 global demand numbers down to 87.7 million bpd.
While the credit crunch is having a restraining influence on demand, it is also beginning to impact investment at the supply end. With the easy oil already discovered and in production, new projects like deep water and unconventional oil are expensive to develop. A tightening of the available credit combined with a falling oil price is likely to lead to a slowdown in development adding to supply concerns. Nobuo Tanaka of the International Energy Agency points out that the market is still tight and the declaration of war by MEND in Nigeria this week will make it tighter still. After all, global demand is still increasing, just at a slower pace.
In the UK this week the government responded to a petition on the issues of peak oil. Their response doesn’t explicitly deny peak oil, but pushes it out to at least 2030 based on the 2007 IEA World Energy Outlook. There is a consequent lack of urgency in efforts to address the issue, in the same way that there is further foot dragging on reducing carbon emissions. The growth of the economy remains the priority, as if it were possible to keep that going and deal with the environment and energy depletion only if we can afford it. In the meantime the economy is going to pieces anyway.
In speaking about a joint renewable energy project with Google this week, Jeff Immelt Chief Executive of GE was quoted as saying “There’s no such thing as a free market…”. In a week which saw a second major bail out of a company by the US government in as many weeks this rings true. So far however, the intervention has been entirely reactionary. More vision and planned intervention will be required to transition to a sustainable economy.
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Crude Oil Rises Above $100 as Dollar Drop Boosts Hedging Appeal
Refiners, Producers May Take Weeks to Restore Output
House OKs bill allowing more offshore oil drilling
Russia to cut oil export duty to support markets
Medvedev: Russia needs to mark its Arctic territory
Nigeria Loses 280,000 Barrels Daily to Attacks Over Five Days
Investors warned of risk to oil sands plans
Oil price fall puts projects at risk
Scientists call for curbing coal burning
Carbon capture stations must not be delayed
Energy security ‘more important than climate change’
Google and GE in energy alliance
Scum’s big break
Wall Street’s seismic shift sends aftershocks
Now financial crisis takes toll in Russia
IEA sees risk of recession if oil stays high
Goldman Sachs Slashes Oil Forecast on Credit Concern
Oil-depletion – epetition response
British Energy and EdF still disagree over price
Leaked papers show Britain trying to weaken plan for EU carbon cuts
Inflation soars to 16-year high