Oil

ODAC Newsletter – July 15

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The world could soon be short of oil again, despite the worsening fiscal crisis, says the IEA. Although the turmoil in Europe threatened to engulf Italy – with the world’s third largest bond market – and the US budget standoff threatened its AAA credit rating, the Agency raised its 2012 oil demand growth forecast by 270,000 barrels/day.

Energy and peace: the dangers of our slow energy transition

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Resource scarcity and climate change should be driving forward our transition to the energy systems of the future. Though this transition has started in important ways in several locations, change is not being undertaken at either the scale or speed required.

Unburnable Carbon – Are the world’s financial markets carrying a carbon bubble? (Report)

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The Carbon Tracker initiative is a new way of looking at the carbon emissions problem. It is focused on the fossil fuel reserves held by publically listed companies and the way they are valued and assessed by markets. Currently financial markets have an unlimited capacity to treat fossil fuel reserves as assets. As governments move to control carbon emissions, this market failure is creating systemic risks for institutional investors, notably the threat of fossil fuel assets becoming stranded as the shift to a low-carbon economy accelerates.

The link between peak oil and peak debt – Part 1

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The economy is closely linked with the physical resources that underly it. Most economists assume debt can rise endlessly, just as they assume GDP can rise endlessly. But if there really is a limit that prevents oil supply from rising endlessly, it seems to me that there is also a corresponding limit that prevents debt from rising endlessly.

Peak exploration: The Apollo program and the high water mark of Western civilization

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As we lament the launching of the last U.S. space shuttle mission, we should pause for a moment and reflect on what it really means. Ironically, the first moon landing happened one year before America reached its domestic peak in oil production, which likely better explains more than any other single factor why the space program failed to advance after Apollo program wrapped up.

Resilient to what?: a fascinating new look at risk

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A chart in the World Economic Forum’s “Global Risks 2011” sets out all the risks they see in the world on a matrix which positions the various risks by their perceived impact on the global economy and by the perceived likelihood of their happening. What you might expect to be at the top, given recent media reports, would be the threat of terrorism or perhaps some hideous computer virus that knocks out nuclear power station. But no. There at the top, leading the pack, are climate change, ‘extreme energy price volatility’ and fiscal crises.