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.
Concern over the possibility of conflict with Iran was a key driver behind fluctuations in the oil price this week. Conciliatory talk at the beginning of the week saw prices drop back, but news of missile testing mid-week by the Iranians kept pressure on. As ODAC went to press, news of a break in the Niger Delta ceasefire and a five day strike at Petrobras in Brazil pushed prices back up, though not to previous records. Despite continued talk by OPEC and BP of speculation-driven pricing, the fundamentals of short surplus capacity and possible supply restrictions indicate that the markets are doing the job of hedging the risk.
There was more evidence this week, this time from the IEA, that oil demand in the developed nations is being hit by high prices. In the developing world however, there is still huge potential for increased demand. China is suffering significant power cuts, which could cause rising demand for diesel to fuel generators in the short-term. China and India this week pushed the onus for carbon reduction onto the G8 leaders whose countries have caused the mess, rather than agreeing to any constraints which might check the development of their own economies.
As the G8 discussed whether it should become the G13 or even 16, diplomacy and sabre rattling around energy security continues on in a way which points to an understanding of the fundamentals of supply challenges. The UK offered help to Nigeria in securing their production from attack, while the US pressed India to accept its nuclear deal even as this split the governing coalition parties. Gas supplies too are under pressure. Gazprom announced that the domestic consumption of gas in Russia has increased by 25 billion cubic metres in the last three years. Increased domestic consumption of oil and gas in producing nations is one of the key challenges facing the importing nations, which can only buy what is put on the market. This could mean effective peak supply before geological peak supply.
T Boone Pickens spoke this week about energy in the Clinton years being the sleeping dog that nobody wanted to kick. By now it is fair to say that the dog is awake and barking.
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Crude tops $137 on Brazil oil strike
Nigeria's MEND Militant Group Plans to End Cease-fire
Total steps back from investing in Iran
Oil may fall 'if financial investors leave'
Output plummets at huge Mexican oilfield
Oil man tells U.S. energy 'horror story'
Gazprom offers to buy all of Libya's gas and oil
Price for Central Asian Gas to Double
Kazakhstan starts building gas pipeline to China
Crisis looms as global gas supplies dry up
Oil price prompts nuclear move
Germany in Hot Seat as G8 Pushes Nuclear Power
French nuclear rivalry may hamper UK energy plans
China Shuts More Coal Power Plants; Warns on Shortage
China's crude oil import volume up 11% in first half
Oil price shock means China is at risk of blowing up
China and India hold out on emission targets
UK government to adopt 'cautious' approach on biofuels for transport
Boris Johnson scraps congestion charge for 4x4 vehicles
Tories lay out cost neutral plan to cut fuel duty
NWA slashes 2,500 jobs, pumps up ticket, bag fees
Oil billionaire Viktor Vekselberg sets out peace plan for TNK-BP row