Energy / Energy-General

• Iran, Oil Prices and Gambling with the World Economy

  The White House last week acknowledged problems in the global oil market but said the situation was secure enough to move ahead with tighter sanctions against Iran. President Obama said he was confident about the current state of the global economy and had assurances there was enough spare capacity to buffer against a severe shock to energy markets. The measure is meant to ensure Tehran doesn't have the finances to back what's seen as a nuclear weapons program. It might be something of a political and economic gamble, however. Obama had until Friday to decide on pushing ahead with sanctions that…

• The Slow Death of Carbon Policy

  In both the EU and the US carbon policy correctness has run its course having been discredited by scandal, the persistence of scientific method, and public pressure to recognize market realities. The proponents of carbon policy changes are caught between panic and despair. They came so close to implementing their policy regimes, and cannot now accept that the world has said ‘No!’ The evidence of the death rattle of carbon policy has been presenting itself for a while but like a degenerative disease it was slow to develop but relentless in its progress.  The EU adopted phase 1 of its…

• South Stream and the EU-Russia Balance of Power in the Western Balkans

  Few developments will have a greater impact on regional dynamics in the Western Balkans than the race to build Russia’s South Stream Pipeline as the Western Nabucco Pipeline falls flat.The countries of the Western Balkans are highly dependent on Russia for gas, with Serbia getting around 85% of its gas from Russia, Bosnia-Herzegovina over 90%, and Macedonia 100%. Croatia, slated to join the EU next year, is much less reliant on Russian gas (less than 40%).  The South Stream pipeline, slated to be operational in 2015, will diversify Russia’s natural gas export routes, running under the Black Sea with split…

• Citigroup's Overly Optimistic Energy Projection for 2020

  Gasoline prices remain high, and Reuters recently noted that there are enough countries with civil unrest, technical problems and bad weather that there are around a million barrels a day of possible supply that are not getting to the market. Yet with Saudi Arabia continuing to reassure that it is willing to pump more oil, if needed, there appears to be, superficially, little cause for supply concerns this year. By the same token, in the longer term, concerns over supply also seem to be increasingly discounted. For example Citigroup has just released a new report on Energy 2020:North America as…

• Turkey's Attempts to Quell PKK Insurgency has Energy Implications

  Turkey has adopted a new strategy in its bid to solve its Kurdish “issue.” Ankara’s outreach initiative has enormous energy implications, as Turkey currently imports 90 percent of its energy supplies and many pipelines run through Turkey’s eastern Kurdish regions, a tempting target which Kurdish militants have attacked in the past. Under the new plan of Turkish Prime Minister Recep Tayyip Erdogan, his government will not attempt negotiations with Abdullah Ocalan, the leader of the outlawed separatist Marxist Kurdistan Workers' Party, or PKK, which Turkey and many other nations have branded a terrorist group. Captured in Nairobi on 15 February 1999 and extradited…

• Geopolitics Informs Gaza's Energy Crisis

  The acute energy crisis that has consumed Gaza is a symptom of realities that have forced Hamas to recalculate its alliances after hedging its bets that a post-Mubarak Egypt would translate into solidified power. Massive queues for gas and daily 18-hour blackouts and hospitals unable to cope without fuel for backup generators has Gaza in a state of panic. The energy crisis has also affected water supplies and sewage treatment. The Hamas government has been smuggling fuel supplies from Egypt to Gaza’s main power plant. The alternative is fuel from Israel, which is more expensive. Until recently, illicit supplies from…

• Patience Needed in Post-Fukushima Japan

  One year after the 9-magnitude earthquake and subsequent tsunami, Japan may still face a nuclear energy crisis. The country was already forced to take on more fossil fuels to offset the loss of nuclear power and could now face a summer of energy shortages given expected shutdowns at its nuclear reactors. Renewables may provide an answer, though the Asian economy may need to muster some political will so that it doesn't lose another decade, but this time to energy. Japan after the 2011 nuclear disaster at the Fukushima Daiichi nuclear power plant started looking to other forms of energy, notably liquefied…

• Trouble on the Iran-Pakistan Pipeline Front

  Pakistan may be seem to be getting political about the Iran-Pakistan (IP) Pipeline, which the US is working hard, if not deviously, to thwart, but the truth of the matter is that Pakistan’s future energy security may rely on the project. Pakistani political leaders across the board, from ruling to opposition, are urging the government not to bow to US pressure to forego the pipeline plans in favor helping to contain Iran, Pakistan’s neighbor. On 21 March, Nawab Zulfiqar Ali Magsi, governor of the Balochistan Province, the country’s largest province and the future host of the Pakistani part of the…

• Russia to Get Oil Railways

  The Russian Federation’s development of a free market, capitalist economy since the unexpected collapse of the Soviet Union in December 1991 can most charitably be described as ‘fitful.” While large portions of the formerly socialist economy have been privatized, large elements of what Soviet economists called “the commanding heights of the economy” have remained in state hands. Even the kleoptoractic administration of Russia’s first President, Boris Yelstin, hesitated to privatize, a process which has proceeded even more haphazardly under his de facto successor (apologies to Dmitrii Medvedev), former KGB member Vladimir Putin. In this context, it’s well worth remembering that Putin called…

• No Policy in U.S. Energy Policy Debate

  U.S. President Barack Obama visited a plant in Cushing, Okla., that is slated to build the southern domestic leg of the longer Keystone XL oil pipeline. The project has become less about the energy debate in the United States and more about partisan tag lines during this year's presidential campaign season. Using political rhetoric as a debating tool during broader discussions on energy issues is doing little to address broader market concerns, however. Republican leaders in the House of Representative have tried to move Keystone XL around the president's desk through various unsuccessful legislative maneuvers. Before Obama left for Cushing this…