ODAC Newsletter - September 9 2011


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 US tropical storm season joined the economy and Libya as a factor driving oil prices this week. Gulf oil installations have escaped damage so far, but a lively storm season has led to platforms being evacuated, causing production delays and depressing US inventories.

In Libya, meanwhile, the production outlook remains uncertain, with Gadaffi still at large, the interim government struggling to provide essential services, and as the scale of the damage to oil export facilities becomes clearer. The IEA’s new Executive Director Maria van der Hoeven said that "Our experts think that 2013 or beyond will most probably show the complete full restoration of the Libyan supply to the market, but not before that". Others think full restoration will take even longer.

In the UK, oil production fell to below 1 million barrels for only the second time in over 30 years this summer as maintenance work added to the depletion curve. The unexpected bonanza of North Sea oil which helped Britain cope with its last period of prolonged recession is long gone: output peaked in 1999 at 2.9 mb/d and has now shrunk by well over half. Operating costs are rising as output falls, and the industry claims uncertainty over tax relief for decommissioning costs is preventing new investment.

On the demand side, stock markets continue to bungee as investors panic over the financial crisis and prospect of a double dip recession; the OECD has slashed its growth forecasts for the US, Europe and Japan. President Obama now faces another battle to get his Jobs Act through Republican opposition in Congress, while the Eurozone continues to flounder amid its existential challenge. Yet oil prices remain firm, at around $115 for Brent crude, and it seems recession would have to cut demand dramatically to make much of a dent.

In gas, the Nord Stream pipeline from Russia to Germany via the Baltic started operations this week, although the first actual deliveries will not arrive until November, once the pipeline has been pressurised with ‘technical gas’. The new supplies are bound for Germany, France, Britain, Denmark and the Netherlands, and should reduce Europe’s vulnerability to any further interruption to supplies via Ukrainian pipelines. But the apparent increase in energy security may be limited: the bulk of Russian gas exports to Europe will still flow via the Ukraine, and the two countries’ bitter and chronic dispute shows no signs of resolution.


Disclaimers

Oil

Oil Heads for Third Weekly Gain on Obama Job Plan, Storm in Gulf of Mexico

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UK oil output falls below 1 million barrels a day

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North Sea oil 'harmed by uncertainty over £30bn decommisioning bill'

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Former Shell chairman James Smith to lead deregulation of UK oil and gas industry

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Unlocked by melting ice-caps, the great polar oil rush has begun

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Oil exploration under Arctic ice could cause 'uncontrollable' natural disaster

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Libya oil exports not to return to normal until 2013: IEA

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Libyan Crude Oil Cargo Is Said to Be Offered for Shipping Later This Month

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Hayward nets £14m in first Middle East adventure

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New IEA Chief to Meet With OPEC Representatives

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Saudi Arabia's water needs eating into oil wealth

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Halliburton: BP Hid Gulf Disaster Details

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China Halts Conoco Work

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Gas

Russia launches major new gas pipeline to Europe, bypasses Ukraine

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Before Release, a Hydraulic Fracturing Study for the State Draws Skepticism

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New York Extends Period For Comments On Fracking

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Fracking stirs controversy in South Africa

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Renewables

German Solar Firms Eclipsed by Chinese Rivals

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Marine energy in Scotland: A rising tide?

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Britain's solar sector hit by cut in Government support

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UK

Time to place your bets on fossil fuels versus renewable energy

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Advisers' letter to David Cameron on energy and climate policies

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Huhne tells Big Six to 'pull their finger out' and increase domestic insulation rates

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UK households too lazy to insulate, E.ON claims

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Transport

Infrastructure projects: The great train robbery

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The Coalition's vision for renewable transport

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Disclaimers

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