" />
Building a world of
resilient communities.

MAIN LIST

 

Peak oil notes - January 12

Developments this week
So far this week oil prices have fallen slightly as bad economic news from Germany and an unexpectedly large jump in US petroleum stockpiles outweighed the increasing tensions and bombast surrounding the Iranian situation. NY oil futures settled Wednesday at $100.87 and London at $112.24 allowing the NY-London spread to increase to $11.37.

The weekly US stocks report showed a 5 million barrel increase in crude stocks and an increase of 9.4 million barrels in total commercial inventories as the 4-week moving average of US petroleum consumption continues to run 6.5 percent lower than last year. With US oil consumption contracting over last year, it is difficult to conceive of what all the talk of economic recovery is based on. The demand for gasoline in the US is now down to 8.2 million b/d, the lowest since 2003 when gasoline prices averaged $1.55 gallon for the year as compared with $3.51 in 2011.

The report that Germany’s GDP contracted in the 4th quarter weighed on prices as the euro slipped to $1.27 taking oil prices with it. Predictions of a recession in the EU abound as Greece’s financial situation continues to spiral downwards and forecasts that the country will default in March are everywhere.

A new factor bearing on oil prices arose this week as much of Nigeria went on strike to protest the removal of gasoline subsidies. Thus far the strike has not had an effect on the 2.2 million barrels of oil per day the country produces; however on Wednesday the oil workers union announced it was making preparations to halt oil production until the government rescinds the gasoline price increase. Nine percent of US crude imports come from Nigeria.

The Iranian situation continues to bubble along. The US Treasury Secretary is in Beijing trying to convince the Chinese to join the boycott of Iranian crude, or at least not buy up the crude that is no longer being exported to other countries.

Although India, South Korea, and Japan are not happy about joining the boycott of Iranian oil, they all appear to be making an effort to find alternative sources of supply. The Saudis and their Gulf allies continue to maintain they can make up much of what the Iranians are currently selling to the EU, India, Korea and Japan, but knowledgeable observers are starting to raise questions about how much spare capacity the Saudis have. The EU’s discussion of whether or not to boycott Iran seems to have been moved forward to January 23rd from January 30th, suggesting that the Europeans have some confidence that their plans are coming together. The trick remains as to just how and when to step up pressure on Tehran without triggering a major oil price spike.

The Hindustan Times reports that Pakistan is heading towards a major crisis as its hydro electricity production is way down, the country is running short of natural gas, and its friends in the Persian Gulf are pulling back from continuing to send Pakistan oil on indefinite credit.

China’s crude imports in December were up 5.1 percent over last December but down a bit from November as economic problems settle in.

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.


Naomi Klein & the Let­down of the Leap Manifesto: Poli­tics Doesn't Trump Physics, Nor the Economics of Collapse (part 2/3)

Politics can be egalitarian when going up Hubbert's Curve, but it's a whole …

Carbon Tracker Analysis: ‘Renewables are Already Outcompeting Fossil Fuels’

Clean technologies are already cheaper, on average, than the incumbent …

Timeline: The Past, Present and Future of Germany’s Energiewende

The Energiewende (energy transition) is an internationally recognised …

The Sower's Way: the Path for the Future

Our paper on "The Sower's Way" has been published in the IOP …

Just 16,000 Catenary Trucks Would Use All of California’s Electricity with only 2400 to 8300 Miles of Overhead Wires

It makes sense to electrify trucks since fuel from oil, coal, and natural …

The Energy-Water Nexus  

Energy and water are inextricably linked: It takes energy to supply water, …

Peak Oil Review - Sept 19 2016

 A weekly roundup of peak oil news, including: -Quote of the week …