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Politics and Economics
Oil thirst from China adds fuel to trade tussle
Geoffrey York, Globe and Mail
Ottawa touts Beijing’s huge energy needs as opportunity to move from U.S. market
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BEIJING — China’s investment appetite for the Alberta oil sands has climbed so strongly that it could be importing 400,000 barrels of oil a day from Canada within the next seven years, Natural Resources Minister John McCallum says.
The Chinese oil ambitions in Canada, which intensified yesterday when Mr. McCallum met two of China’s most powerful oil executives, are a key element in the Liberal government’s aggressive push to diversify Canada’s energy sales away from its traditional U.S. markets in the aftermath of the softwood-lumber dispute.
Despite denials from Ottawa, the government’s new strategy of pitching oil to China is widely seen as a pressure tactic against Washington after its refusal to comply with the NAFTA softwood ruling. The Americans are ignoring a ruling by a North American free-trade agreement panel that U.S. tariffs on softwood lumber are illegal under U.S. trade law.
(14 October 2005)
Investment in renewable energy heats up
Mark Tran, Guardian
Renewable energy is a field ripe for entrepreneurs, judging by the growing investor interest in the area.
The London Stock Exchange yesterday hosted a renewable energy capital markets day, an event designed to match new companies in clean energy with potential investors.
The first event of its kind at the LSE to focus on renewable energy, it drew an impressive number of investors. They expected about 30 investors to show up. Instead about 90 came, including some of the biggest names in the financial world: UBS, Merrill Lynch, Barclays and Goldman Sachs.
…For [David Wilson, the finance director of Tersus], energy efficiency is a safe area to invest in. Even if oil prices come down from their current highs of over $60 a barrel, the drive for energy efficiency is not going to go away, he argues.
“Why wouldn’t you do it anyway, it’s going to save you money,” he says.
As for the wider picture, Mr Wilson believes it has never been a better investment climate for the renewable energy and energy efficiency sectors, not just because of high oil prices but because of the political imperatives that arise from the climate change debate.
(14 October 2005)
U.S. Economy: Consumer Prices Soar on Gasoline; Retail Sales Up
Bob Willis and Carlos Torres, Bloomberg
Hurricanes Katrina and Rita pushed U.S. consumer prices up and industrial production down by the most in a quarter century last month, while rising retail sales show the storms’ effects may be short-lived.
Prices paid by consumers jumped 1.2 percent, the biggest increase since March 1980, as gasoline prices soared, the Labor Department said today in Washington. Core prices, which strip out fuel and food costs, rose 0.1 percent for a fifth month. Industrial production slumped 1.3 percent and retail sales rose more than expected excluding autos, other reports showed.
Uninterrupted spending and concern that companies will soon pass on higher fuel costs to consumers suggest the Federal Reserve will keep raising interest rates through early 2006, economists said. For now, an expanding job market and rising home equity are helping Americans overcome record gasoline prices.
(14 October 2005)
Related stories:
US inflation flares on record surge in energy cost (Reuters)
CPI posts biggest gain in 25 years (CNN/Money)
Who is politically unstable?
Roland Wilson, New Era Investor
In the search for Peak Oil truth, the traveller has to be careful where he treads. …Various half-truths and outrights lies may be used but the one that has always made me rankle somewhat is the idea that a lot of the world’s oil is tied up in politically unstable regions. …
Unstable implies a system which is prone to volatility or even collapse. How does that apply to the alleged “politically unstable” countries? What about Saudi Arabia, the world’s biggest oil producer?
Saudi Arabia is an absolute monarchy ruled by the House of Saud. The modern Saudi Arabia is actually the third kingdom of the House of Saud since the first one created in 1744. The first House of Saud lasted 75 years, the second lasted from 1824 until 1899, also 75 years.
The current House of Saud unified the various disparate kingdoms into modern Saudi Arabia in 1932 under its first ruler, Abdul Aziz Ibn Saud. It has now existed for 73 years with no sign of any real threat to its authority.
…So why is Saudi Arabia classed as politically unstable? The reason is because it’s political system is divergent from those of Western democracies. In its wisdom, western civilisation has decided that it is the benchmark whereby other civilisations are measured and judged. It is not that the Saudi system itself is inherently unstable, but that the interface between it and the political systems of the main oil consuming nations are doctrinally divisive.
… Iran also has been stable for 26 years unless you deem its war with Iraq to be destabilising, but then again Iran was not the aggressor in that conflict. The only unstable area is currently Iraq and we all know about that.
And so we go on to Russia which some decide is also unstable despite being around since 1992 as a democracy. It has conflicts along its borders such as Chechyna but I again refer to Britain with the IRA , Britain battling Argentina over the Falklands and Britain fighting insurgents in Iraq. Russia is not a politically unstable country. It may be becoming more absolutist, but this is not per se unstable in terms of being prone to collapse.
(14 October 2005)
Interview: Omar Freilla Director of Green Worker Cooperatives (VIDEO)
Global Public Media
Omar Freilla, Director of Green Worker Cooperatives, speaks with Global Public Media’s David Room about society in the South Bronx, the Environmental Justice Movement, worker’s cooperatives, racial equality, and energy peak.
(14 October 2005)
Bush asked to explain why he won’t release heatoil
Tom Doggett, Reuters
WASHINGTON – Democratic Rep. Edward Markey (news, bio, voting record) of Massachusetts asked the Bush administration on Friday to explain why it will not tap the government’s emergency heating oil stockpile, even though federal law allowed it do so this week after heating fuel prices reached high levels.
For the first time ever, the U.S. Northeast experienced sustained high heating oil costs long enough to hit the price trigger that gives
President George W. Bush the option to release supplies from the 2-million-barrel heating oil reserve. The White House declined to use the reserve for the moment.
(14 October 2005)
U.S. counts more oil, gas rigs destroyed by storms
Reuters
The U.S. government has raised its tally of the number of oil and natural gas platforms in the Gulf of Mexico destroyed by hurricanes Katrina and Rita to 113, according to the Interior Department.
Interior Secretary Gale Norton said last week that 108 offshore platforms had been destroyed by the two storms. That number was increased to 113 in the department’s latest hurricane damage assessment.
The department also raised the number of underwater pipelines damaged by the hurricanes to 58 from 44.
(14 October 2005)
