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Gazprom warns W. Europe could be hit by gas shortages
Yuri Fedotov, Guardian
Britain was given a sharp reminder of the dangers to its energy supplies yesterday when Gazprom warned that western Europe could be hit by gas shortages. The Russian gas provider said a long-running row with Ukraine could disrupt supplies this winter.
The fears were raised 24 hours before Russia hosts a meeting of the world’s major gas suppliers to set up an Opec-style production cartel that could push up the price of energy in Britain and elsewhere. Energy experts warned that the two events demonstrated that Russia was using energy as a political weapon, and argued Britain should accelerate its switch to renewable power in order to reduce its dependence on unpredictable carbon fuel suppliers.
(28 December 2008)
Oil giants are itching to invade Iraq
Danny Fortson, Times (UK)
The big players have been shut out since nationalisation in 1972. Now they see their chance to get in
… Iraq sits atop a sea of 115 billion barrels of oil, the largest reserves in the world after Saudi Arabia and Iran; enough to produce for the next 126 years, according to Deutsche Bank.
Yet since the Iraqi government nationalised the industry in 1972, oil’s main players have been shut out. Years of war and violence have kept them at bay.
That may be about to change. In October the Baghdad government kicked off a round of bidding to allow international oil companies to exploit eight of the country’s largest oil and gasfields. BP, Royal Dutch Shell, Exxon Mobil and Gazprom are among the 35 companies that have put concerns about security to one side and thrown their hats in the ring. The deals would pave the way for the first significant foreign investment in the country’s biggest fields in more than three decades. Some side deals have already been signed — last month Shell announced a $4 billion (£2.7 billion) gas joint venture with the Iraqi government and opened a permanent office in the country.
For Iraq the timing couldn’t be better. As reserves dry up around the world and national governments tighten their grip on what is left, the industry is more desperate than ever to get its hands on the Iraqi honey-pot. The plummeting oil price, from a high of $147 a barrel this summer to a new low of $36 last week, has focused their minds.
(28 December 2008)
Pengrowth acknowledge peak oil (PDF)
James S. Kinnear (CEO), Pengrowth Energy Trust
fireangel at TOD:
By my knowledge no oil company has acknowledged peak oil this well. This is in Pengrowth Energy’s presentation slide 9
- World was nearing Peak Oil at 87 MMBbl per day and this
has not been changed by recent events
- Peak could be accentuated due to lack of development and insufficient supply growth
- Rest-of-World production will decline more rapidly in lower price scenario meaning that eventual peak will have a larger OPEC component
- Continuing climate change could put pressure on increased fossil fuel use, despite lower price
- After an interim period of “lower” prices, shorter than previous cycle, demand will increase, creating supply constraints
Mentioned by commenter fireangel at The Oil Drum – DrumBeat.
The first part of the presentation presents Pengrowth’s view of world oil supplies. -BA
Deutsche Bank: Demand for oil will fall by largest margin in 25 years
Tim Webb, Observer
Gloibal demand for oil in 2009 will fall by the largest amount for 25 years, according to the chief energy economist of Deutsche Bank.
Adam Sieminski said oil prices could hit a low of $30 a barrel next year, a fall of a quarter from today’s price, because of the sickly global economy. He forecast an average price of $47.5 for the whole year for oil traded in New York. Deutsche Bank predicts global demand will contract by 1 per cent, or 1 million barrels a day, three times the fall seen this year and the biggest since 1983.
Sieminski is predicting much lower prices than most other analysts and even Opec or the International Energy Agency (IEA). He said that other forecasts underestimate how much the global downturn would reduce demand for oil.
(28 December 2008)
A Recent History of Oil Prices
Professor Chris Rhodes, Scitizen
The price of oil has oscillated from an all-time hike of almost $150 a barrel to a low of $30, hand in hand with the credit-crunch and the inextricable economic connection between money and oil. Why? Expect a Long Emergency…
… The shortages and high prices that are inevitable in the future will render viable the extraction of oil sources that cost $50, $70, or $100 or more, a barrel, including offshore/deep water fields, oil sands, oil shale, and enhanced/secondary recovery from depleted fields. As couched in the jargon of microeconomic theory, the supply curve will be much steeper than in past years. Shifts in demand, either up or down, will hence cause swings of relatively greater amplitude in the market price. Nonetheless, even the most expensive sources of oil will be unable to provide anywhere close to the 30 billion barrels of crude oil that the world currently depends on each year. It is the rate of supply (variously termed rate of flow, rate of conversion or rate of recovery) that is at issue. Put simply, it doesn’t matter how big the volume of the resource is, if oil cannot be recovered at a rate of 85 million barrels a day to meet present demand (and rising), we must learn to live by using less oil. This poses a challenge that is simple but not easy, since it must involve curbing our reliance on personalised transport, mainly cars, which most of the world’s crude oil is currently used to run. The corollary to this is the need to develop rapidly, more localised communities, that depend far less on cheap oil-based transportation, which will no longer exist. Meanwhile, expect a Long Emergency situation, as Kunstler has warned us: the demand-supply gap for oil, and then peak oil will bite hard on the tail of the credit-crunch.
This is the final section to an article entitled: The Oil Question: Nature and Prognosis” which will be published in the popular science journal “Science Progress”, probably around now. I thought I would put it as a posting on here for any general interest and/or comments.
(28 December 2008)
The Oil Drum’s year-end report
Nate Hagens, The Oil Drum
Thanks to the TOD Staff, and to the TOD Community. (Social Capital is Alive and Well…)
As a tumultuous year draws to a close, both from an energy perspective and just in general, I wanted to thank the staff of this website, as well as TOD’s readers and community who raise our level of discussion and impact by adding links, references, graphs and ideas, and making local and individual change. I’d particularly like to thank our (sole) technician, SuperG, and Drumbeat editor, Leanan, who have both tirelessly put in another year of volunteering their skills towards making the site run smoothly, and in the case of Leanan, continuing to find, organize and disseminate energy and resource depletion based news items every day of the year! (outside spring baseball training)
We are into our 4th year of theoildrum.com’s existence. In many ways, this site, (as well as the thousands of emails exchanged between staff behind the scenes), represents a microcosm of post-peak oil social interaction. It is not always smooth and there are occasionally disagreements and personality clashes, but the community at large, over time, pares away the informational chaff and furrows closer to the truth on the issues discussed, while maintaining strong reciprocity within the tribe. None of us (staff or readers) are compensated by the measure which currently drives society – money. Though there are probably many explanations why we volunteer our time here, prominent among them is hope for a better future: an altruistic vision that what is discussed and learned here will raise the bar of both national energy/resource discussions and their implementations. Thus we are being ‘paid’, but by social and human capital.* Perhaps this in itself is an important model to attempt.**
(28 December 2008)