One factor that could help to slow the melting of the Arctic, but which has not yet received serious consideration at an international level, would be to cut the amount of “black carbon” – soot – that we spew into the air. Black carbon darkens ice when it falls, causing it to absorb more heat, and may be responsible for half of the warming effect in the Arctic, according to recent research published in Nature Geoscience. Cutting down on soot would not only remove large amounts of air pollution, but, according to some scientists, could be much quicker and easier than cutting carbon dioxide emissions.
On current form, the chances of this being agreed also look small, however.
Energy companies in the US, already unhappy about the new administration’s dim view of offshore continental shelf drilling, will not be cheered by comments from Todd Stern. In an FT interview published today, the US chief climate negotiator warned that companies making carbon-intensive investments could live to regret it, as measures to reduce carbon emissions are introduced.
“How good will the business judgment of companies that make high-carbon choices now look in five, 10, 20 years, when it becomes clear that heavily polluting infrastructure has become deadly and must be phased out before the end of its useful life?”
He also talked about the challenges of agreeing to multi-lateral aid to help poorer countries cut their emissions.
“We are in the middle of trying to work through how a financing package might be constructed … There might be some that comes from public monies, appropriated monies, but I do not think that will be the core of it. We will doubtless need to use carbon markets in one fashion or another.”
Gordon Brown was talking up the government’s green spending in the Independent today ahead of the UK Budget on April 22. It was hardly on the scale of the energy announcements that have been coming out of the US – in fact there was very little in it that hadn’t been already announced. But with the state of the UK public finances there are unlikely to be any big energy-related surprises in the Budget.
Most of the news related to cars. Alastair Darling will announce trials for electric cars in two or three cities, and the government “will open talks with power companies to ensure the vehicles can have their batteries recharged at a national network of power points at the roadside.”
Brown also mentioned cash incentives for car ‘scrappage’ – measures to encourage drivers to replace their old cars. This has been under consideration for some time. In the Independent, Brown mentioned a figure of up to £2,000 per car.
And to set an example, ministers will have electric cars.
US crude oil prices have dropped below the $50 a barrel level amid renewed concerns about demand weakness in the US and Japan. Nymex May West Texas Intermediate lost $1.43 at $47.72 a barrel ahead of the latest US weekly inventories data which was expected to show a further increase of 1.9m barrels in crude stocks, according to a poll of analysts by Reuters.
US crude stocks have already reached their highest levels since since July 1993 and a further rise was anticipated in the latest EIA data out later today, with a rise in crude imports towards the 10m barrels a day level seen as likely.
Analysts at the Schork Report wrote:
All told, total crude oil inventories in the U.S. as of Friday, March 27th ballooned to a record 1.07 billion (x109) barrels. That equates to approximately 118 days of import cover (the IEA requirement is 90 days). In other words, there was no change last week… you still can’t swing a cat without hitting a barrel of crude oil in the United States.
When Ken Salazar, Secretary of the Interior, arrives today at a meeting in New Orleans with the oil and natural gas industry on developing the US Outer Continental Shelf, he will get an earful.
The industry is worried the Obama Administration is so eager to promote renewables that it does not realise such energy cannot possibly provide all US energy needs for many years to come – if ever.
Even now, they argue, renewables cannot run without fossil fuel power as a backup. When the sun does not shine or the wind does not blow, it is power plants, fueled by natural gas, that tend to pick up the slack.
As the industry sees it, the entire Outer Continental Shelf should be open for oil and natural gas development. Tim Sampson, manager of exploration and production for the American Petroleum Institute, says: “That would mean more jobs, more revenues for cash-strapped local, state and federal governments, and greater energy security.” Only problem is it would also mean more carbon dioxide. And this is the area the Obama Administration is most concerned about.
Hungarian energy group Mol is wasting no time taking defensive action against the Russians, after Surgutneftegaz bought a 21 per cent stake in the company last month. Mol is cutting its dividend altogether, and changing its statutes to compel shareholders to declare the “ultimate beneficial owner” of their shares, if requested by directors.
Austrian group OMV, which sold the stake to Surgut, was accused by Mol’s chairman of acting as a ‘front’ for Russia.
MOL said in the documents for the April 23 annual meeting of its shareholders (AGM) that according to a planned amendment of its statutes shareholders must declare who the “ultimate beneficial owner” of their shares is before their meetings, if requested by MOL’s board of directors.
“…the current ownership changes and structure justifies running appropriate mechanisms against a stealth takeover of the company and to ensure that the directors get a realistic picture about who the company’s real owners are,” MOL said.
Other proposed amendments would strengthen the special voting rights of the “B” series MOL share and delete the section which says that the special rights exist only if the share is held by the Hungarian state.
As an FT editorial pointed out, Hungary supports both the Nabucco gas pipeline plan and the rival Russian Southstream project. Nabucco will be a difficult enough undertaking without further friction between EU members.