ODAC Newsletter - June 26
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.
Further attacks on oil pipelines by Nigerian militants along with a fall in US inventories helped reverse oil price declines from earlier in the week and bring prices back to over $70/barrel by Thursday. According to European Commissioner Andris Piebalgs speaking at a Tuesday meeting between the EU and OPEC, the current price does not impede economic recovery. So far however the price doesn’t appear to be enough to restore energy investment either. Fatih Birol told Reuters that investment may have fallen even further than the 21% or $100-billion cited in the IEA’s May report. Speaking in New York, Nabuo Tanaka of the IEA warned that a resumption of world economic growth in 2010/11 to around 5% could cause a supply crunch by 2014.
José Manuel Barroso, the President of the European Commission this week warned vulnerable countries to create contingency plans against the real possibility of further gas disruption due to the dispute between Russia and Ukraine. With the Ukrainian Presidential election now announced for mid January the political games around the disagreement are only likely to intensify.
Next week will see the release of a report by the Institute for Public Policy Research on UK gas security. Allegedly the report calls for an urgent increase in storage capacity to reduce vulnerability and calls for public money to be invested. With UK public debt at what Mervyn King this week called “truly extraordinary” levels, money may be hard to find.
Gordon Brown’s attention currently appears to be on oil rather than gas. This week he apparently demanded an emergency plan to stop a rising oil price from wrecking economic recovery, and is pushing for an international agreement to monitor prices - as if that will make any difference. It's only the latest in a series of futile interventions by the PM, such as the 'oil stability' summit he held in London last December, since when the price has more than doubled. What Mr Brown fails to grasp, it seems, is that oil is becoming more energy intensive and costly to extract while demand is likely to increase inexorably - if and when the economy starts to grow again. The only real protection is to reduce our reliance on crude before the going gets really tough. But in a week when Mr Brown was forced to perform multiple hand-brake turns on the Iraq inquiry, it is clear his government does not have the political strength to deliver such a policy - even if it wanted to.
Oil, Gasoline Rise After Attack on Shell Pipeline in Nigeria
OPEC, EU say regulation needed to stop oil bubble
Energy investment to lag further: IEA
IEA says potential for oil supply crunch by 2014
Total granted go-ahead to expand in Russia
China quenches thirst with £4.4bn Addax deal
European gas war looms as Ukraine seeks cash to pay Gazprom for July deliveries
UK must expand gas storage for security -think tank
Europe warns Britain of dangers of rising debt
Brown demands emergency plan to stop oil wrecking recovery
Refinery workers plan Paris demo
UK's National Grid outlines power future
BP chooses Ericsson chief as new chairman
Drax raises £108m in new shares to fight debt
Rail freight operators feel the strain
Stagecoach attacks ‘chaotic’ DfT
Lord Adonis sees demise of short flights
Lord Adonis launches electric car trials
Denmark to power electric cars by wind in vehicle-to-grid experiment