Daily Archives: June 9, 2009

Kate Mackenzie

It could be one of the tiniest green shoots out there: the Energy Information Agency in its latest short-term energy outlook increased its projection for world crude demand to 83.68m – up from May’s forecast for the year of 83.67m barrels per day.

In fact, we checked with the EIA and they said May was 83.672m and June was 83.677m – so the difference was only 5,000, barely showing up in the two decimal places the EIA publishes.

It’s small beer in the context of a 2 to 3 per cent decrease on the previous year. But all eyes will be on the IEA’s next report, out on Thursday. For 10 consecutive months now it has revised its 2009 forecasts downwards.

Related story:

$60 oil: compare and contrast (FT Energy Source, 13/05/09)

Kate Mackenzie

Delphine Strauss writes:

EU Energy Commissioner Andris Piebalgs was quoted today by the Russian Interfax agency as saying “We are close to signing the Nabucco deal, in late June or early July”.

He is not the only one to sound an optimistic note: everyone with an interest in the Nabucco project is publicly optimistic European governments will soon reach a deal to bring the pipeline closer to reality.

Noone seems quite so sure how that is going to happen.

Kate Mackenzie

The number of clean energy patents granted fell slightly in the first quarter of 2009, but was still higher than a year earlier.

The index, published by law firm Heslin Rothenberg Farley & Mesiti P.C.’s Cleantech Group, shows the number of clean energy patents fell in the first quarter, by almost 7 per cent to 243. However is higher than Q1 2008, which saw 220 patents granted.

Interestingly few of the categories show a strong trend during the period apart from wind (the dark blue line) and extremely erratic growth in fuel cell patents.  The number of patents granted in any given period is small and volatility is high; the lowest volume such as tidal and geothermal are mostly in the low single digits each quarter. Full charts for each can be found on the CEPGI blog.

But what does it tell us? As they note, the number of successful patent applications could indicate the level of inventive activity and the effectiveness of R&D efforts – and indeed the fall-off may tie in with reports from New Energy Finance last week suggesting Q1 was the low point of investment in the industry, as financing and investment appear to have picked up since the end of last quarter.

Car companies tend to top the list and this quarter Honda took the lead from GM, with 23 patents. GM and Toyota tied for second place with 13.

Panasonic popped into fourth place with 12 patents – 10 for fuel cells – and Cleantech Group says this more than they filed six for the entire 2002 – 2008 period.

Related story:

Positive news for renewables: financing begins to return (FT Energy Source, 05/06/09)

Kate Mackenzie

On Energy Source:

Corporate: Does the oil industry makes careers difficult for women?

Markets: An oil-dollar signal

Emissions: Trains, planes and empty buses

Markets: Crude breaks two-day losing streak

Legal: How the Saro-Wiwa case was settled

Oil: Oil prices rises yet to affect estimates

Geopolitics: The political world of Iranian gas development

Elsewhere:

Canadian CEOs on peak oil Most agree with the theory, say the timing is unknown (Canadian Business Online)

Pricing oil in Big Macs From 27 in 2008 down to 19 this year (Gregor)

Peak coal: what do tighter supplies mean for ‘clean coal’? USGS survey prompts a reassessment for the ‘Saudi Arabia of coal’ (Environmental Capital/WSJ)

How much does a climate bill cost, anyway? Analysis tends to underestimate the effect of innovation (TNR)

Solar thermal: the other kind of solar energy It may have better prospects than photovoltaic (Economist)

How much should poor countries be paid to fight climate change? And other dilemmas (Green Inc/NY Times)

Ed Crooks

With Vivienne Cox’s departure from BP, Europe’s two biggest oil companies have both lost their most senior women executives in the space of a month, following Linda Cook’s resignation from Shell.

Ms Cox is being replaced by another woman: Katrina Landis, her deputy at BP’s alternative energy business. But even so, the news that Ms Cox is going, aged just 49, has reignited the debate about whether the oil industry makes it more difficult for women than men to have successful careers.

While the downturn may have eased skills shortages recently, over the longer term the oil industry is going to need all the talent it can find, and putting barriers to women’s employment is clearly going to be counter-productive. But making the industry more workable for women would require some radical changes.

By Izabella Kaminska

As reported here, over the last month we’ve seen the negative correlation between oil and the dollar stage an impressive return. As Stephen Schork of the Schork Report points out on Tuesday, its comeback echoes the correlation seen back in June 2007-2008. He notes that back then:
The June 2007–08 timestep saw one of the most extreme examples of negative correlation in recent memory. Oil prices and dollar rates between June 2007 to April 2008 (see above) had a negative correlation of negative (0.9477)!

Meanwhile recently:

Correlation began rising again from negative (0.63) in April to negative (0.94) in May. In fact, on any given day between the end of April and last week, if Crude booked a loss the dollar booked a gain (and vice versa) 80% of the time.

Kate Mackenzie

A few reports around yesterday suggested that planes might be less environmentally harmful than trains. If you thought that sounded odd, so did Infrastructurist, who were somewhat annoyed with the simplified headlines given to some reports.

The paper itself, by Mikhail V Chester1 and Arpad Horvath at UCL Berkeley, says there is more to it than the environmental cost of transport systems than the journeys themselves – a point summed up in its title: “Environmental assessment of passenger transportation should include infrastructure and supply chains”.

One part of the paper compares the greenhouse gases emitted simply in operating a mode of transport to the total cost per passenger kilometre travelled (PKT).

To estimate this second figure, the paper goes quite far into the background costs of various types of transport. 

Kate Mackenzie

Miles Johnson writes:

The price of oil rose for the first time in two days on Tuesday, aided by a weaker US dollar and encouraging economic data from China.

Nymex July West Texas Intermediate, the US crude oil benchmark, crept back towards last Friday’s seven-month high of $70.32 by gaining 79 cents to $68.88 a barrel. ICE July Brent, the European benchmark, rose 88 cents to $68.76.

Market expectations that weekly crude stocks data will show a fall in US crude inventories also helped oil rise. Analysts have forecast data from the US Energy Information Administration, the oil statistical arm of the US goverment, to show that crude stocks fell by 400,000 barrels, according to a poll conducted by Reuters.

Oil prices have jumped since February at the same time as global equities and credit markets have rallied as investors started to position themselves for a recovery in the global economy. News that vehicle sales in China rose by 34 per cent last month fed into the recovery narrative, with some investors interpreting the data as a signal that global fuel demand would increase over the medium-term.

Recent dollar strength, prompted partly by better-than-expected US employment data last week, has dampened the appeal of dollar-denominated commodities for investors using non-US currency. But on Tuesday the US dollar traded lower.

Read the full commodities report

Kate Mackenzie

The 13-year case against Shell over the execution of nine Nigerian activists in 1995 has been settled out of court, with the oil company paying $15.5m to the plaintiffs.

It ends the case launched by relatives of Nigerian activist Ken Saro-Wiwa and eight others, who were hanged in 1995 after campaigning against Shell’s activities in the Ogoniland region of the Niger Delta, and against the then military-led government.

Shell has denied being complicit in Mr Saro-Wiwa’s death and a reign of terror by security forces in the Ogoni region, and says it appealed for clemency before the 1995 executions.

$5m of the money will go towards a trust, which will be overseen by trustees independent of both the plaintiffs and Shell, to fund education, health, and community development programmes such as literacy, small enterprise support and support for women. The remainder of the money will go towards legal costs, and to the plaintiffs.

Shell’s Malcolm Brinded said, the company’s statement:

“Shell has always maintained the allegations were false.  While we were prepared to go to court to clear our name, we believe the right way forward is to focus on the future for Ogoni people, which is important for peace and stability in the region.

“This gesture also acknowledges that, even though Shell had no part in the violence that took place, the plaintiffs and others have suffered.”

The plaintiffs, in their statement, said they were pleased to announce the settlement, and had these messages:

  • To our people, we say Ake, Beenu, Nonu, Sitam. The struggle continues.
  • To the rest of our supporters and campaigners, we thank you for keeping us company and for your support for all these years, and the years to come.
  • To Shell, we say that this is one more payment of the overall debt it owes to Nigeria. We acknowledge that there have been some changes in the company’s attitudes. The world has changed and Shell cannot afford to continue to do business as usual in Nigeria. Yet we hope that the lessons Shell has learned from its continuing encounters with the Ogoni will serve the company well. We note that Shell still faces further claims by Ogonis both individually and collectively.
  • And to that end we wish to send a message to our dear brothers and sisters in the Niger Delta and in Nigeria that dialogue remains the most humane and creative option in the search for peace and a mutually beneficial coexistence.

The fact that the case was launched in the US reflects something of a legal curiosity. The claim was made under the US Alien Tort Claims Act of 1789 – which has made a comeback after being forgotten for almost two centuries:

The statute’s original purpose remains a subject of speculation but its effect was to give foreigners a means to pursue civil court actions in the US over alleged violations of international law. It is widely thought the act was meant to target high seas piracy and to address concerns about cases in which overseas powers felt they had been denied justice, such as a much-publicised assault on a French diplomat on US soil in 1784.

About 64 alien tort cases are thought to have been brought in the past 30 years, with most of those in the past 15 years. Although none have been won after a full trial, there have been several high profile settlements including one between Unocol and Burmese villagers who alleged they were forced to work on a pipeline project for the company, and another settlement by Yahoo over claims related to the jailing of two Chinese dissidents. The revival of interest in the act has provoked some controversy, but supporters argue it is filling a vacuum as few other options exist for those who believe they have been wronged by big businesses; particularly in poor nations where legal systems may lack perspicacity.

Related links:

Shell in $15.5m settlement over executions (FT, 08/06/09)
Old law exhumed by human rights fighters (FT, 25/05/09)

James Fontanella-Khan

- Shell chief calls for pay reforms
Jeroen van der Veer steps down this month (FT)

- Korean oil group considers Addax tie-up
The state-owned group is considering a takeover or asset deal (FT)

- Heritage Oil and Genel Energy to unveil merger
Expected to announce deal today (FT)

- Shell in $15.5m settlement over executions
Case stemming from allegations the oil group was complicit (FT)

- Lex: US petrol prices
America’s things-are-slightly-less-bad recovery seems to have legs (FT)

- High gas prices could slow recovery
After just a few months of relief at the pump, cheap gasoline is disappearing (NYT)

- Takeover battle as EcoSecurities rejects bids
The company has received two approaches in consecutive working days (FT)

- BP’s alternative energy chief to retire
Vivienne Cox, 49, is BP’s most senior female executive (FT)

- US offers $1.4bn for carbon capture and storage projects
Investment to include oil refineries, steel plants and power plants (Platts)

- Veolia, Keolis bid for Transdev stake
Transdev has sales of €2.3bn (Reuters)

- China is willing to engage in climate-change talks
‘Common but differentiated responsibility’ says vice premier Li Keqiang (Bloomberg)

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