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.
The announcement from Jeddah on Sunday that Saudi Arabia is to raise oil production by 200,000 bpd did little at the beginning of the week to bring down oil prices. The announcement came against the backdrop of more attacks by militants in Nigeria, which reduced Shell’s off-shore production by 225,000 bpd as well as causing on-shore cuts from Chevron.
What the Saudi meeting did indicate was that OPEC’s ability to manage the price as a cartel is under strain with both Saudi and Kuwait acting independently and other members already pumping flat out. In short Saudi Arabia has been unable to convince that it holds sufficient swing production to offset disruption in supply from elsewhere.
The report from the US Energy Information Administration (EIA) later in the week that non-OPEC production is falling, but that it estimates an increased global demand for fuel of 50% by 2030 and much of that in transport fuel, is chilling. Even if such production were remotely possible the consequences for the environment would be catastrophic.
Clearly the EIA does now see limits to the potential for growth in Saudi output and has reduced its forecast, but head of the organization Guy Caruso is optimistic about Russia. This is not an optimism shared by ODAC trustee David Strahan in his piece on the state of Russian oil and the BP TNK row.
The high price of fuel, especially for transport is however having an impact on demand and also habits. In the US demand is down. In March, Americans drove 11 billion fewer miles on public roads than in the same month the previous year - the sharpest one-month drop since records began in 1942. In Northern Mexico diesel supplies ran low as prices drew customers from over the border. In the UK public transport suppliers are seeing increased usage and in China the government implemented a major increase in prices in order to improve energy efficiency.
It’s been a busy week for Gordon Brown who has realised that his own political survival relies on putting energy into energy. His speech today at the Government's Low Carbon Economy Summit announced a new determination to push through an energy “revolution”. He even stated that “... a low carbon society will not emerge from 'business as usual'. It will require real leadership from government.... It will mean new kinds of consumer behaviour and lifestyles”. So why then is his party sticking so tenaciously to business as usual in the form of globalization and the determination to build a third runway at Heathrow?
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Saudi oil boost fails to alleviate concerns
Oil production: it's like asking a tobacco firm to invest in nicotine patches
Kuwait to hike oil output in '09
EIA cuts world 2010 oil output; big non-OPEC loss
China Raises Fuel, Power Prices to Curb Energy Demand
US oil demand slides
Hope springs eternal but the oil won't: a Russian lament
Fuel woes overshadow EU-Russia talks
Scientists warn of lack of vital phosphorus as biofuels raise demand
Put oil firm chiefs on trial, says leading climate change scientist
Carbon Trust aims to end 'greenwash' by launching company standard
Dion's green anti-poverty plan
Congress Looks for a Culprit for Rising Oil Prices
Brown unveils £100bn renewable energy plan
Heathrow rift grows as Kelly backs runway
Cost of food drives one in three to grow own fruit and veg
Arriva benefits from switch to public transport
Woman dies during red diesel raid on farm
Future of fast ferries in doubt as cost of fuel soars