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.
This week ODAC welcomes the publication of two important reports. In its excellent Heads in the Sand report, Global Witness provides one of the clearest summaries of the peak oil issue to date, including a trenchant critique of the IEA’s position. The ‘ten things you ought to know about oil supply’ on page 6 acts as a handy reference and ought to be enough to trouble even the most optimistic observer.
The second report The Great Transition from the New Economics Foundation (nef), is a bold stab at a roadmap to address the issues of peak oil, climate change and ‘ecosystem pressure’. The approach, which borrows heavily from Transition in terms of method and language, is an attempt to design a workable response to the challenges, with a focus on equity and a rebalancing of values.
As the oil price rose to $82/barrel, another high for the year despite the generally dismal economic picture, the usual suspects were hauled in for the blame line-up. Secretary-general of OPEC, Abdalla Salem El-Badri speaking at the annual Oil and Money conference in London, accused speculators of causing the rise, while others pointed to dollar weakness or economic recovery. In China, whose rampant economy barely paused for breath as the developed world plunged into recession last year, 3rd quarter growth hit 8.9%.
In Britain the cost of nuclear power was in the news as the government apparently prepares to unveil a new strategy. A report in the Guardian claimed the government plans to subsidize new nuclear power stations by establishing a floor of €30 for the carbon price, raising the average electricity bill £44 per year. But the story ignored the good arguments in favour of a minimum carbon price, which would also benefit renewables and discourage fossil generation.
UK residents are invited to sign a petition asking the government to respond to the recent report on Global Oil Depletion by the UK Energy Research Council (UKERC).
View our Reports and Resources page
Oil
Oil prices hit high but report warns of supply crunch
World oil prices hit their highest point for a year yesterday, as a major new report urged governments around the world to take drastic action to head off an approaching oil supply crunch.
US light crude futures pushed above $79 a barrel, supported by the view that a recovering world economy would raise demand for crude. Oil prices have more than doubled from the low point they hit in the spring, but are still around half the all-time high of nearly $150 a barrel they reached in early summer last year.
Analysts have been surprised at the recent resilience of oil prices given the impact on energy demand of the global recession. In spite of this year’s volatility in the oil price, the underlying trend for a decade has been for it to rise steadily.
A report from the non-governmental organisation Global Witness – famous for its exposé of so-called “blood diamonds” – pointed to an impending supply shock that could be so severe that many of the world’s poor countries would simply be shut off from the world of energy by sky-high prices…
Oil Falls Below $81 as Rising Dollar Buoys Commodities Demand
Crude oil fell below $81 a barrel as the dollar strengthened against the euro, reducing demand for commodities as an alternative investment.
Oil retreated from a one-year high as the dollar advanced after China’s economic growth missed some analysts’ forecasts. Investors buy dollar-priced commodities to hedge against a weaker U.S. currency…
OPEC and corporations disagree as oil hits 12-month high of $80 per barrel
Abdalla Salem El-Badri , secretary-general of OPEC, blamed governments for failing to keep speculators in check, pointing out that there was no shortage of oil supplies around the world.
“I’m not an advocate of banning speculation, but they should not be going wild,” he said. “If they go wild, everybody goes wild.”..
The sun slowly sets on the West’s oil men
“Oh somewhere in the $60 to $90 range for the foreseeable” – that was the consensus for the oil price that most energy executives milling around at the Oil & Money conference in London gave this week.
That is until John B Hess, the man whose father founded the $120bn oil-exploring Hess Corporation 76 years ago, shook up the room with his apocalyptic outlook for the world’s galloping energy consumption.
The price of $140 per barrel oil was not an aberration. It was a warning,” he started. Some home truths from Mr Hess followed:…
Conoco sees oil output peaking below 100 mln bpd
The chief executive of U.S. oil major ConocoPhillips (COP.N) said he expected it will be hard for crude supply to meet demand in the years ahead, with output possibly peaking below 100 million barrels per day.
“It’s going to be very difficult to get up towards 100 million barrels,” Jim Mulva told reporters at the sidelines of the Oil and Money conference in London.
Iraq’s oil power grows, but firms eye election
Iraq has taken a step closer to becoming a giant on the global oil stage, but political manoeuvrings either side of elections in January may yet stall plans to nearly triple oil output.
Baghdad is near to signing off on deals to pump millions more barrels per day from the world’s third-largest reserves, potentially vaulting it to third from 11th position in the league of top oil producers…
Obama administration to review Bush-era oil shale leases
The Obama administration will investigate a decision in the last week of the George Bush era to grant extremely favourable terms to oil companies operating in the Rocky Mountain region.
In a conference call with reporters today, the interior secretary, Ken Salazar, said he had directed his inspector general to look into the leases for oil shale development on some 12,140 hectares (30,000 acres) in the Rockies…
Setback for US crackdown on oil speculation
US plans for an aggressive crackdown on energy speculation are in danger of unravelling, with leaders at the US commodity regulator raising doubts about proposed reforms…
Gas
Shale gas supply debate heats up
Just as the rest of the world begins to get excited about prospects for shale gas reserves, a skirmish is growing over just how much shale gas is actually recoverable in the US…
Yamal peninsula: The world’s biggest gas reserves
The Yamal peninsula in Arctic Russia contains the biggest gas reserves on the planet. Their exploitation will release millions of tonnes of carbon dioxide into the atmosphere and, on the peninsula itself, pose a grave threat to the Nenets reindeer herders and their ancient way of life.
Russia’s former prime minister Viktor Chernomyrdin recently put the figure at 55 trillion cubic metres of gas. Gazprom, Russia’s state energy giant, is more circumspect. But it still says there is nearly 38 trillion cubic metres on the peninsula and in adjacent offshore fields – enough to supply Europe for several decades…
Enthusiasm for Natural Gas Cools
Developing countries around the world are increasingly turning to natural gas as their alternative transportation fuel of choice. But early official embrace of the technology in industrialized nations has mostly cooled, because risks inherent in mass deployment outweigh the benefits, especially in regard to climate change.
After a decade of double-digit annual growth, according to several estimates, more than 10 million vehicles worldwide are now powered by methane derived from natural gas or organic waste. Official support, especially in Asia, South America and gas-producing countries, is likely to drive the number to at least 50 million by 2020…
British Gas owner could use cow manure to heat homes
British homes could soon be heated by gas produced from cow manure and sewage slurry, under plans being considered by Centrica, the owner of British Gas.
The company, which has 16 million UK customers, is drawing up plans to build a plant that would use organic waste to produce biomethane that could be injected directly into the national gas network. National Grid has estimated that such biogas could supply 18 per cent of total UK demand for gas — or 18 billion cubic meters of the approximately 100 billion total consumed in Britain every year…
Nuclear
Families face nuclear tax on power bills
Government officials have drawn up secret plans to tax electricity consumers to subsidise the construction of the UK’s first new nuclear reactors for more than 20 years, the Guardian has learned.
The planned levy on household bills would add £44 to an annual electricity bill of £500 and contradicts repeated promises by ministers that the nuclear industry would no longer benefit from public subsidies. There is mounting pressure on the power industry to show it can keep the lights on, with fears growing of an energy gap as ageing nuclear stations are retired and plans for new coal plants attract hostile protests…
Nuclear power: A bung by any other name
The details are of course shocking, but the broad thrust of our story today on the government’s secret plans to subsidise nuclear power is also sadly unsurprising. The history of atomic power has always been one of huge costs overruns, massive government bailouts and the running problem of what to do with the toxic waste – in other words, it is the history of taxpayers handing over cash to giant nuclear companies. The atomic lobby sometimes tries to pass off this woeful track record as ancient history, but it is not – just ask the Finns. A nuclear reactor was meant to open on the Finnish island of Olkiluoto this summer, but – after four years of building, countless defects and at least a €2bn rise in the original costs – the thing will not be working until 2012 at the earliest. Remind us, what is the Finnish for “trebles all round”?…
UK
A tale of how it turned out right
Western governments, including the UK’s, are desperate to restore the global economy along “business as usual” lines. But, argues Andrew Simms, that is a short-sighted approach; a radical, green-tinged redevelopment would bring much bigger environmental, social and economic benefits.
If someone offered you a plan that would get rich countries on to a radical path of deep, immediate carbon cuts to tackle climate change and also solved a great swathe of social problems, would you take it?…
Andrew Simms is policy director of nef and a co-author of The Great Transition
Government’s fast-track plan for power will raise hackles
The Government is likely to anger local campaigners today as it announces a list of nuclear reactors, high-voltage power lines and giant wind farms that it wants to fast-track through Britain’s planning system by using new powers it obtained this month.
The list of 11 significant energy and transport infrastructure projects is being published today by the Infrastructure Planning Commission (IPC), a new government-backed body set up this month in the biggest shake-up to Britain’s planning regime in 60 years…
The number of people behind with their energy bills increases by 50 per cent
Citizens Advice said it had seen a 46pc increase in the number of people contacting it during the past six months.
The number of people falling behind with fuel bills soared by nearly 50pc during the past six months, a charity warned today…
Energy and climate change : Questioning the invisible hand
FOR many left-wingers, the credit crunch was proof that markets do not always know best. The near-collapse of the world’s banking system shows once and for all, they argue, that an industry as important as finance cannot be left to the whims of the invisible hand. Yet despite much speechifying from banker-bashing politicians, such views do not seem to have taken hold. Bonuses are back in many City dealing-rooms, and the old argument against regulation—that it would drive firms away from Britain and impoverish the country—is being heard again…
Climate
Greenland melts miners’ hearts as receding ice reveals its treasure trove
It is — or was — one of the most inhospitable places on Earth, where temperatures plunge to -60C and darkness reigns for months at a time.
Now, however, a combination of retreating ice sheets, soaring metal prices and a drive for independence from Denmark have unleashed a rush for gold, zinc, lead and oil exploration in Greenland…
China-India deal to resist carbon caps
India and China struck an agreement on Wednesday to co-ordinate efforts to combat climate change that has at its core demands that the developed world take the lead in cutting global carbon emissions…
Melting Himalayan ice prompts conflict fear
On the outskirts of Kathmandu, capital of Nepal, climate researchers twiddle with computers displaying maps of the Himalayas. At the press of a button, rivers and mountain passes change colour and watercourses expand to show villages swept away by simulated flood waters…
Economy
China economic growth accelerates
China has said it is on track to hit its growth target of 8% this year, after the economy grew 8.9% from a year ago in the third quarter.
The figure is up from the 7.9% rate seen in the previous quarter and is the country’s fastest GDP growth since the third quarter of last year…
China car output ‘breaks record’
Chinese annual car production has topped 10 million for the first time as carmakers boost output to meet growing demand, state media has said.
The 10 millionth car produced this year rolled off the First Automobile Works Group assembly line in Changchun, the official Xinhua News Agency reported…
