" />
Building a world of
resilient communities.

MAIN LIST

 

Peak oil notes - Feb 25

Prices and production
After a $10 a barrel increase over the previous two weeks, oil has been quiet for the past few days, hovering around $80 a barrel and closing Wednesday at $80. The EIA reported a 1.9 million barrel buildup in US crude stocks last week, but also a 900,000 barrel decline in gasoline inventories. While distillate inventories fell by only 600,000 barrels, a major winter storm in the Northeast and much colder weather forecast for next week should increase the pace of the draw down. The usual factors – value of the dollar, interest rates, outlook for economic growth – were cited as the impetus for the small price moves.

The Chinese reported they processed 29 percent more crude last month than in January 2008 and forecasters are saying that Beijing’s demand will continue to increase, with refining capacity increasing from 7 million b/d to 7.5 million this year. Taiwan reported that its economy grew by 9.2 percent in the last quarter, boosted by increased exports to China.

US natural gas prices fell again this week reaching $4.77 per million BTUs, the lowest since December. This is likely to change with a big snow hitting New England today and an Arctic blast forecast to hit the eastern US next week.

Although the EIA says distillate and jet fuel consumption is down substantially from last year, gasoline consumption increased to 9.06 million b/d last week, a 6 percent increase over the prior week.

The Iranian standoff continues, with Tehran saying it will build ten new nuclear enrichment sites under mountains where they cannot be bombed; the Russians saying they don’t want too severe an embargo on the Iranians; Secretary of State Clinton reporting progress on organizing an embargo; Tehran continuing to denounce the IAEA report saying it is going for nuclear weapons; and a growing chorus, including Japan, urging China to get off the fence and support an embargo.

Goldman Sachs continues to believe we will see $95 oil before the year is out.

Venezuela
Concern is growing that the major drought-caused power shortage may force Caracas to cut back on refining at the 900,000 b/d Paraguana refinery complex and other oil producing facilities. The government is scrambling to cut back on water and power consumption as well as making arrangements for importing power from Columbia and importing additional generating equipment. Venezuela is thought to produce about 2.2 million b/d of crude and to export about 1.7 million b/d, of which about 900,000 b/d is shipped to the US. If the power shortages grow worse and the government is forced to divert power from oil production and refining to maintaining social order in the cities, world oil and gasoline prices could be forced higher. Chavez continues to blame some of the power crisis on subversives sabotaging their national grid.

What do you think? Leave a comment below.

Sign up for regular Resilience bulletins direct to your email.

Take action!  

Make connections via our GROUPS page.
Start your own projects. See our RESOURCES page.
Help build resilience. DONATE NOW.


A Big Summer Story You Missed: Soaring Oil Debt

Last July the government agency, which has collected mundane statistics on …

Peak oil notes - August 28

A mid-week update. Oil prices have been quiet this week trading around the …

Global Biofuels Status Update

Today I want to take a deep look at the global biofuels picture, drawing …

Update on US natural gas, coal, nuclear, renewables

On August 6, I wrote a post called Making Sense of the US Oil Story, in …

The Peak Oil Crisis: When?

 The key question is just how many more months or years will production …

Community energy in Ireland: the technological aspects

It is important to keep in mind that technologies aren’t neutral.

Peak Oil Review - Aug 25

 A weekly review including: Oil and the Global Economy, The Middle East …