ODAC Newsletter - 25 April 2008


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 ghost of Corporal Jones stalked the land this week, as Britain braced for the two-day strike at Grangemouth refinery in Scotland. ‘Don’t panic! Don’t panic!’ went the cry from everybody from Business Secretary John Hutton to the AA, as petrol stations started to run dry north of the border - evoking memories of the fuel protests that brought the country to a standstill back in 2000.

But there is plenty to worry about. Although the strike is only set for Sunday and Monday, management had already ordered a shutdown on safety grounds, and this has forced the closure of the Forties Pipeline System which lands 700,000 barrels per day. This in turn could halt production at up to 70 North Sea platforms, affecting not just oil but also gas. Meanwhile it could take up to a month to return the refinery to full capacity. This week’s commentary from John Hall Associates explains the background.

It was just one more bull factor that pushed the oil price to yet another record high of $119.90 this week. Others included more attacks in the Niger delta, soaring demand in the Middle East, and perhaps even the growing backlash against biofuels.

But the big news of the week is the announcement that Saudi Arabia has shelved plans to expand production capacity beyond 12.5 mb/d by 2009. Oil Minister Ali al-Naimi justified the decision on the basis that there would not be the demand (arguable), and King Abdullah has recently declared that his country should save some oil for future generations (entirely sensible), but even the moderately skeptical will take this as further evidence that Saudi Arabia is struggling. The announcement has all the more impact coming just one week after the news that Russia has peaked – according to one Lukoil executive – and that advisors to the Nigerian government believe that country’s output will fall by a third by 2015. No wonder that both the IEA and OPEC said the price is heading higher.

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Disclaimers

Oil

Strike could close key Grangemouth oil refinery for a month

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North Sea oil pipeline set to close ahead of strike

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Shell Nigeria's Bonny Crude Output Cut After Attack

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Middle East energy demand soaring, matching China

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Saudis put oil capacity rise on hold

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Nothing stopping oil prices from rising: IEA

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Oil prices to head even higher says Opec chief

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Lehman warns that oil boom will deflate

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Gas

Indian oil minister visits Pakistan for talks on Iran pipeline

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India's Petronet braces for fierce battle over Australian LNG

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Regal in talks over Ukraine gas fields sale

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Coal

Europe Turns to Coal Again, Raising Alarms on Climate

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Falling Polish coal output raises energy security fears

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Electricity

S Africa power crisis forces Lonmin to lower forecast

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Ofgem inquiry into alleged mis-selling of contracts by npower

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China sees 2008 power shortfall at 10 GW

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Nuclear

German utility prepares to build two nuclear power stations in UK

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Renewables

Green v green

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Scottish government rejects plans for Lewis wind farm

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Banks meet over £40bn plan to harness power of Congo river and double Africa's electricity

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Biofuels

Biofuels starving our people, leaders tell UN

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EU set to scrap biofuels target amid fears of food crisis

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Food

Food crisis — but it's no surprise

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Era of cheap food ends as prices surge

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Soil Association accused of harming African farmers

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Climate

EU, Japan in climate change call

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Business

Russia claims £130m taxes from BP venture

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Russia looks at all options to invest its oil billions abroad

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Transport

European airlines face squeeze on profit

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Berlusconi hit by first crisis as Alitalia faces bankruptcy

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Sky-high fuel hurts US airlines

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Fuel fears rattle Arriva shares

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Green future in sight for London's black cabs

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Disclaimers

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