Welcome to the ODAC Newsletter, a weekly roundup from the Oil Depletion Analysis Centre, the UK registered charity dedicated to raising awareness of peak oil.
“By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.” Such is the summary not of ODAC, ITPOES or ASPO, but of the United States Joint Forces Command. Their annual report, known as the JOE (Joint Operating Environment) is intended to inform the development and outlook of the US armed forces. The report points to growing energy demand in the developing world, citing as an example the huge potential for growth in car ownership in China, which currently has only 40 million vehicles to the 250 million in the USA. It predicts that the coming oil supply gap will “at best... lead to periods of harsh economic adjustment”, though the report also warns of the geopolitical turmoil which followed the Great Depression.
Economic growth in the developing world, and especially China, which reported first quarter growth of 11.9%, caused the IEA to up its estimate for 2010 oil demand to a record high of 86.6 million barrels/day. Should this transpire it would be marginally higher than the boom year of 2007 which saw a peak oil price of $147/barrel. Of course much has changed since 2007, Western economies are still barely emerging from recession and are saddled with massive public debt, so the growth estimate signals a huge power shift in which the developing economies grow rapidly even without a swift recovery in their key export markets.
In the UK, current oil prices are already being translated into record petrol prices. Rising fuel taxes play a part, but much of the pressure comes from a weak pound. A further demand-driven rise in the oil price could be devastating - not that you would have known it from Britain’s first ever live television leadership debate last night. Neither energy security nor climate change made it into the first round of questions – and the phrase peak oil appears nowhere in the main parties’ manifestos. There are two more debates to go before the election, so you never know, the biggest crises facing humanity might just get a look-in.
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OilUS military warns oil output may dip causing massive shortages by 2015Demand for oil will hit record levels and threaten recovery, says energy agencyIEA Increases 2010 Non-OPEC Supply Outlook on Russia, Canada OPEC Holds Oil-Demand Forecast SteadyOPEC would consider output hike if oil hits $90-$95Crude Oil Falls on Signs Economy, Demand May Be Slow to Recover BP brushes off investor revolts on tar sands, payGuest Commentary: David Strahan, ODAC trusteeSaudi oil use to grow steeplyOil to Set New 2010 Record, Barclays Says: Technical Analysis Iranian Tankers Expand Oil Storage to Echo 2008 SurgeGasNord Stream gas pipeline underwater construction starts Gazprom Says вЂAbnormal’ Gas-Price Gap to Undermine InvestmentElectricityEurope Urged to Share Power Across ContinentRenewablesThe answer to clean living may be blowing in the wind Sinking turbines blow ill wind across offshore energy sectorMolten metal batteries to be clean energy reservoirsUKВЈ30bn hole in party election pledgesWhat happens to petrol prices when the economy starts motoring again?Oil price increase вЂless bad for UK’EconomyChina's economy grows nearly 12 percent China reports rare trade deficit GeopoliticsChina offered oil for sanctions deal over IranWhite House says Iran nuclear threat years awaySoros warns Europe of disintegration OilUS military warns oil output may dip causing massive shortages by 2015Terry Macalister, The Guardian, 11 Apr 2010View original article
The US military has warned that surplus oil production capacity could disappear within two years and there could be serious shortages by 2015 with a significant economic and political impact.
The energy crisis outlined in a Joint Operating Environment report from the US Joint Forces Command, comes as the price of petrol in Britain reaches record levels and the cost of crude is predicted to soon top $100 a barrel...
View report
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Demand for oil will hit record levels and threaten recovery, says energy agencyRobert Lea, Industrial Editor, The Times, 14 Apr 2010View original article
Demand for oil will hit an all-time high this year, the International Energy Agency has forecast.
The agency also warned that increased global consumption, fuelled by a near-20 per cent leap in demand in China, could choke off economic recovery in the UK and continental Europe...
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IEA Increases 2010 Non-OPEC Supply Outlook on Russia, Canada Grant Smith, Bloomberg.com, 13 Apr 2010View original article
The International Energy Agency bolstered its 2010 supply outlook for countries outside the Organization of Petroleum Exporting Countries as production rose in Canada, the U.K. and Russia.
Non-OPEC producers, accounting for about 60 percent of the world’s supplies, will raise output by 600,000 barrels per day this year to average 52 million barrels a day, the IEA said in its monthly market report today. That’s 220,000 barrels a day more than estimated last month. The agency left its forecast for global oil demand in 2010 little changed, 30,000 barrels a day higher than in last month’s report...
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OPEC Holds Oil-Demand Forecast SteadySpencer Swartz, Wall Street Journal, 14 Apr 2010View original article
The Organization of Petroleum Exporting Countries maintained a cautious view about world oil demand and gave no indication it might pump more crude to damp the recent rise in oil prices.
Since early March, oil has closed above $80 a barrel for all but a handful of days, leading analysts to question whether OPEC is getting more comfortable with a higher oil-price plateau. That view has gained traction following comments from some OPEC ministers in recent days that the group may stand pat even if crude-oil prices move north of $90 a barrel...
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OPEC would consider output hike if oil hits $90-$95Reuters, arabianbusiness.com, 13 Apr 2010View original article
OPEC would consider raising crude output if the oil price rose to around $90 to $95 a barrel, delegates from the producer group said on Tuesday.
Crude oil futures traded at around $83.80 a barrel on Tuesday, above the $70-$80 mark that OPEC's top producer Saudi Arabia and other members have described as fair for both consumers and producers...
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Crude Oil Falls on Signs Economy, Demand May Be Slow to Recover Margot Habiby, Bloomberg.com, 15 Apr 2010View original article
Crude oil fell for the sixth time in seven days as unemployment claims unexpectedly jumped to a two-month high and industrial production improved less than anticipated, signs energy demand may be slow to recover.
Oil fell as much as 0.7 percent as the Labor Department said initial jobless claims rose 24,000 to 484,000 in the week ended April 10. Warmer weather caused utility use to drop the most in four years, limiting the rise in March industrial production to 0.1 percent, according to the Federal Reserve...
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BP brushes off investor revolts on tar sands, payTom Bergin, Reuters, 15 Apr 2010View original article
Oil major BP Plc on Thursday easily beat off challenges to a Canadian oil sands project and to its executive pay policy.
Europe's largest oil company by market value said 94 percent of shareholders who voted in advance of the annual meeting rejected a call to review its Sunrise project to squeeze crude from Alberta's bitumen-drenched soil. A group of shareholders including California Public Employees' Retirement System (CalPERS), ethical investor Co-operative Investments and a raft of environmental groups tabled the resolution...
Guest Commentary: David Strahan, ODAC trustee
See commentary Who's Afraid of the Tar Sands?
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Saudi oil use to grow steeplyTamsin Carlisle, The National, 13 Apr 2010View original article
Saudi Arabia has emerged as the second-biggest source of global oil demand growth after China.
Higher oil consumption in the Arab world’s biggest economy is forecast to account for 11.7 per cent of global expansion this year, the International Energy Agency (IEA) said...
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Oil to Set New 2010 Record, Barclays Says: Technical Analysis Grant Smith, Bloomberg.com, 13 Apr 2010View original article
Crude oil will probably exceed this year’s peak of $87 a barrel and may rise as high as $94 in New York, according to technical analysis by Barclays Capital.
Crude futures have retreated 2.2 percent on the New York Mercantile Exchange since climbing to an 18-month high of $87.09 a barrel on April 6. Prices are set to rise again, Barclays forecasts, as the commodity is drawn toward the halfway point in its slump from an all-time high in summer 2008 to a four-year low in December of that year...
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Iranian Tankers Expand Oil Storage to Echo 2008 SurgeAlaric Nightingale, Bloomberg.com, 12 Apr 2010View original article
Iran, OPEC’s second-biggest crude producer, expanded the number of supertankers being used to store surplus oil, echoing a program that contributed to a tripling of freight rates two years ago.
At least nine such vessels are idling in the Persian Gulf, Gulf of Oman and to the south of Egypt’s Suez Canal, according to data from the ships collected by AIS Live Ltd. Two months ago, there were three. Their depth in the water indicates they are loaded, with as many as 18 million barrels of oil being stored, almost enough to supply Europe for a day...
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GasNord Stream gas pipeline underwater construction starts BBC Online, 09 Apr 2010View original article
Construction of the controversial Nord Stream pipeline from Russia to western Europe under the Baltic Sea has been officially launched.
Gazprom holds 51% of Nord Stream, which will run from the Russian port of Vyborg to Germany's Greifswald...
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Gazprom Says вЂAbnormal’ Gas-Price Gap to Undermine InvestmentAnna Shiryaevskaya - Bloomberg, Business Week, 15 Apr 2010View original article
OAO Gazprom, the world’s biggest natural-gas producer, said an “abnormal” gap between spot fuel prices and long-term contracts is threatening investments in new fields and pipelines.
Spot gas prices slumped last year as the recession slowed consumption, while U.S. success extracting the fuel from shale rock added to supply. The output increase in the U.S. diverted some liquefied natural gas cargos to Europe and led Gazprom’s traditional customers to demand lower contract prices...
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ElectricityEurope Urged to Share Power Across ContinentJames Kanter, New York Times, 12 Apr 2010View original article
Renewable energy in Europe should be generated and distributed on a continental scale to make the greatest contribution toward reducing greenhouse gases, according to a report that raises significant challenges for a fragmented region.
The report, to be released Tuesday, was compiled by the European Climate Foundation, a group financed by philanthropic organizations, using studies carried out by McKinsey, a consulting firm...
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RenewablesThe answer to clean living may be blowing in the wind Kate Laycock, Deutsche Welle, 13 Apr 2010View original article
Wind power currently meets eight percent of national energy needs. Much of that comes from huge turbines at wind farms, but experts are now predicting major growth in a diminutive version of the same thing.
Small wind turbines are defined as those which produce up to 100 kilowatts of energy per hour, and the fact that a summit was recently held in their name goes some way to highlight their future importance. But the path towards integrating them into the popular mindset is not without hurdles...
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Sinking turbines blow ill wind across offshore energy sectorAngela Jameson, The Times, 14 Apr 2010View original article
Hundreds of offshore wind turbines could be suffering from a design flaw that makes them sink into the sea.
Energy company engineers are urgently investigating the extent to which their offshore wind farms are affected, after flaws were discovered on a Dutch wind farm last autumn...
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Molten metal batteries to be clean energy reservoirsDavid C. Holzman, New Scientist, 09 Apr 2010View original article
A BATTERY able to match the output of those used in cellphones from 1/20th of their electrode area may have you dreaming of more talk time.
But putting it in your pocket would be a bad idea - it's full of molten metal. Instead, its inventors hope it will provide much-needed storage capacity for electricity grids...
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UKВЈ30bn hole in party election pledgesChris Giles, Jean Eaglesham and Nicolas Timmins, Financial Times, 15 Apr 2010View original article
Britain’s three main political parties all have a £30bn hole in their manifestos that will have to be plugged with huge tax rises or spending cuts after the election, according to Financial Times calculations based on their policy pledges...
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What happens to petrol prices when the economy starts motoring again?Rowena Mason, Telegraph, 12 Apr 2010View original article
"A weak currency arises from a weak economy which in turn is the result of a weak government." It was a simple equation trotted out by now-Prime Minister Gordon Brown when in the opposition party during the 1990s.
Now, in the run-up to an election, with the pound looking sickly against the dollar and the cost of imports comparatively rocketing, he and Lord Mandelson have been furiously trying to stop their enemies "talking down" the currency...
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Oil price increase вЂless bad for UK’Emma Saunders, Financial Times, 12 Apr 2010View original article
A permanent rise in the oil price would leave the UK economy in better shape than other importers such as the eurozone, Japan and the US...
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EconomyChina's economy grows nearly 12 percent CNN Wire Staff, CNN, 15 Apr 2010View original article
China's economy revved into high gear during the first quarter of 2010, growing 11.9 percent over a year ago, a spokesman for the National Statistics Bureau said Thursday.
The nation's gross domestic product -- a broad measure of economic output -- also gained 1.2 percent from the fourth quarter of 2009...
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China reports rare trade deficit Chris Hogg, BBC Online, 10 Apr 2010View original article
China has recorded its first monthly trade deficit in almost six years.
Officials blame the $7.2bn (ВЈ4.7bn) deficit on rising volumes and prices of the raw materials the country needs to import to power its economy...
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GeopoliticsChina offered oil for sanctions deal over IranDavid Usborne, The Independent, 14 Apr 2010View original article
China is being privately reassured that its supplies of oil would be guaranteed in the event that it supports tough new UN sanctions on Iran, its third largest supplier of crude.
Western sources at the nuclear security summit Washington confirmed "talks have been going in that direction" with China. Such an agreement, designed to clear a major obstacle to consensus on new measures against Iran, may also have been discussed by President Barack Obama with Hu Jintao, the President of China, at bilateral talks this week at the White House...
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White House says Iran nuclear threat years awayDaniel Dombey in Washington, Financial Times, 15 Apr 2010View original article
The Obama administration said on Wednesday it would probably take Iran three to five years to make a nuclear weapon, a statement that provoked incredulity from Senator John McCain, the former presidential candidate...
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Soros warns Europe of disintegrationGillian Tett and Chris Giles in Cambridge, Financial Times, 12 Apr 2010View original article
The eurozone area and wider European Union is now “on the brink” of disintegration unless Germany steps up and provides loans at below-market rates to Greece, George Soros, the hedge fund manager, has warned...
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Stock market on best roll since ‘07Peak oil notes - Apr 8
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