On FT Energy Source this week:
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The Russians are at it again. They have invited Opec to a gathering in Moscow that the oil cartel has absolutely no interest in attending. There is good reason for that. While Opec has been cutting its production to boost oil prices – a painful and tricky policy that has largely been successful – Russia has been lowering tarrifs and urging its companies to pump all they can. That means Russia has taken over from Saudi Arabia as the largest oil producer, though the kingdom’s capacity of 12.5m b/d far outstrips that of its rival.
Sergei Shmatko, Russia’s energy minister, insists he promised Opec nothing.
Menawhile, Ali Naimi, Saudi Arabia’s oil minister, has taken Russia’s oil production in his stride, recently quipping: “All people are doing is depleting their resource base fast. Time takes care of all these things. We are happy and content.” Read more
Views about whether the recent flurry of oil discoveries make a difference to future oil supply depend very much on how big those fields are thought to be.
In the FT today, Bob MacKnight at PFC Energy says the new discoveries will shallow the decline rather than move the peak, whereas Wood Mackenzie’s Ann-Louise Hittle suggests the new front between Ghana and Sierra Leone could perhaps move the goalposts. Read more
The United States was long the pariah of international climate change efforts under the Bush Administration. Climate change negotiators, looking towards the big Copenhagen meeting in December, have welcomed the Obama Administration’s willingness to tackle climate change. The new president’s stance on the subject at the G8 talks and the Major Economies Forum meeting in July was cause for optimism for various world leaders and climate officials.
But Congress isn’t necessarily going to match up to these high hopes, and as December draws near, other countries are showing signs of impatience. Read more
Mainstream financial analyst types tend to shy away from talking about peak oil – even when they are talking up a looming supply crunch, this tends to relate to short- to mid-term investment shortage. So a presentation by Iain Reid, a senior oil analyst at Macquarie Bank, stirred much excitement when some details were published by Reuters this week. Read more
The natural gas industry is desperate to get top billing in the Obama Administration’s attempt to clean up America. It missed an opportunity with the Waxman-Markey bill, assuming the House would recognize its benefits as an abundant fuel that is the least carbon intensive of the fossil fuels.
The House didn’t.
Indeed, natural gas only comes up just twice in the more than 1,000 pages of the bill. The industry wants more than that. It wants natural gas to be recognized for having 100 years worth of supply left in this country alone, having roughly half the carbon content of coal, being a strong contender as a transportation fuel, and being the fuel renewables often use as a backup, when the sun does not shine or the wind does not blow. Read more
Analysts agree, natural gas fundamentals are still bearish. Despite that, Nymex Henry Hub futures went — dare we say — a little crazy this week in terms of volatility. After a massive run-up mid week, the contract closed 8 per cent lower on Thursday. Read more