" />
Building a world of
resilient communities.

MAIN LIST

 

Peak oil notes - March 3

Developments this week
The fighting in Libya continues to push oil prices higher with NY crude futures settling on Wednesday at $102.23, the first settlement above $100 since summer 2008. In London, Brent crude settled at $116.35 a barrel after touching $117.80. The situation in Libya appears to be moving towards a prolonged civil war, with the West unwilling to intervene militarily and neither the forces still loyal to Gadhafi nor the rebels having the strength to overcome the other. The IEA says as much as 1 million b/d of Libya’s pre-uprising production of 1.6 million b/d is no longer being produced. Although a few tankers apparently are still leaving the country, much of the circa 1.3 million b/d of exports is no longer being shipped.

The Saudis announced that they have offered two European refiners additional cargoes of Arab Light crude for loading in March. Given that European refiners are facing shortfalls on the order of 30 million barrels or more per month due to the shut-in Libyan production, it is difficult to see the Saudis coming up with this much oil and getting it to European refiners on short notice. Most knowledgeable observers are skeptical that the Saudis can make up for the loss of the high-quality Libyan oil.

The weekly US stocks report showed a drop in US crude inventories of 364,000 barrels as opposed to a 750,000 barrel gain forecast by analysts. US gasoline inventories fell by 3.6 million barrels contributing to another rise in NY gasoline futures of 4.6 cents a gallon to close at $3.03. Forecasts that average US gasoline prices will be above $4 a gallon by the Fourth of July are now widespread. For now, however, US demand for oil products continues to run 1–2 percent above last year at 19.6 million b/d.

In addition to concerns that the fighting and reduction in oil production in Libya may be prolonged, concerns are rising over the possibility of domestic unrest in other Middle Eastern oil-producing countries. Websites are calling for a Saudi “Day of Rage” on March 11, and there are reports of demonstrators clashing with security forces in Tehran on Tuesday. In Oman, which produces nearly 900,000 b/d, the protests have spread to the capital. In Iraq, the country’s largest refinery was badly damaged by a militant attack.

Newly released Chinese numbers show an 80-percent reduction in gasoil exports in January year over year. This suggests that Beijing is still concerned about diesel shortages developing during the spring planting season. Although some precipitation has fallen on China’s winter wheat crop, the situation remains serious.

What do you think? Leave a comment below.

Sign up for regular Resilience bulletins direct to your email.

Take action!  

Find out more about Community Resilience. See our COMMUNITIES page
Start your own projects. See our RESOURCES page.
Help build resilience. DONATE NOW.

 

This is a community site and the discussion is moderated. The rules in brief: no personal abuse and no climate denial. Complete Guidelines.


Evidence Released at TransCanada’s Keystone XL Permit Renewal Hearing Sheds Light On Serious Pipeline Risks

Just because TransCanada continually states that the Keystone XL pipeline …

Peak Oil Notes - July 30

Much of the news that will eventually move oil prices came on the …

Higher-risk 'Shallow Fracking' More Common than Suspected: Study

The fracking of oil and gas less than a mile from aquifers or the Earth's …

Shale Gas Reality Check

Recently, the EIA released its Annual Energy Outlook 2015 and so we asked …

The Community Energy Revolution

Impact investing is investing to achieve a return in something you also …

Peak Oil Review - July 27

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

Energy Crunch - Green taxes: love or hate?

Green taxes have been under attack on all fronts lately.