Energy

• Peak Oil Demand: The Beginning and End of Oil

  It is demand for oil that may peak as governments adapt to the problems of global warming, security of supply and an amplitude of market volatility that could bring economic ruin to nations and then the world. Oil-demand may be reduced preemptively to the production peak (peak oil) through more efficient vehicle technologies and finding alternative energy sources. Ultimately electricity is seen as the best "supply vector" for delivering energy to users. Probably it is a game of "tag" between reducing demand and falling supply; whichever comes first will win-out. Peak Oil is the global term used to describe an…

• The Rush for Coal: Are Price Increases Coming

  I've been talking a lot about coal lately. Specifically, how India's need for thermal coal imports is going to tighten this market, both in terms of prices, and bids for coal deposits within shipping distance of Asia. India simply doesn't have enough coal. As of yesterday, one-third of the nation's coal-fired power plants were running at "critical" levels of coal stocks (meaning less than seven days of supply). And 10% are at "super-critical", with less than four days of stock. I've been on this theme for about six months. And finally some of the signs of India's "dash for coal"…

• Peak Oil Interview With Robert Rapier

  Back in June, I gave a presentation on Peak Oil at the Global Footprint Conference in Siena, Italy. Following my presentation, I was asked to do a pair of interviews. One was for an upcoming documentary called Critical Mass. The second was for the conference itself, and that interview has just been made available and is embedded below. Peak Oil Interview for the Global Footprint Conference <object classid="clsid:d27cdb6e-ae6d-11cf-96b8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=6,0,40,0" width="425" height="350"> <embed type="application/x-shockwave-flash" width="425" height="350" src="http://www.youtube.com/v/PjOFCegjoik&feature" data="http://www.youtube.com/v/PjOFCegjoik&feature"></embed> </object> Some of the ground covered in the interview includes: - The misconception that Peak Oil means we are running out of oil…

• The Challenges of Drilling for Offshore Oil

  The first offshore oil well completely out of sight of land was drilled in 1947, 17 km off the Louisiana coast in the Gulf of Mexico. The platform of the drilling rig was no larger than a tennis court and was supplemented by several refurbished naval barges remaining from WWII which provided both space for storage and for the crew to sleep. The seabed was a mere 15 feet below, but now far greater depths of water are being fathomed. In 2008, Shell's 22,000 tonne Perdido spar was towed from Finland where it was constructed to a spot 320 km…

• Is Coal the New Black Gold?

  After the halting and starting three week rally we have seen in stocks, I would be negligent to recommend equity plays here. But there is one sector you should add to your "buy on meltdowns" list and that is King Coal. Demand from emerging markets, especially metallurgical coal needed to make steel, is absolutely exploding. Industry experts say a major super cycle of buying from China, South Korea, Japan, and Taiwan that is creating a long-term structural shortage for the black stuff. One of the reasons Warren Buffet's Berkshire Hathaway acquired the Burlington Northern Railway (BNR), was that it obtains…

• Natural Gas: As Bad as It Seems?

  Hedge funds are dumping natural gas. The most recent Commitments of Traders report in the U.S. shows that bets on natgas by funds dropped 16% in the week ended September 14. Bringing the total to the lowest level this year. Indeed, sentiment in the gas business is running low. As one analyst bluntly told me on a recent visit, "Gas is [three-letter synonym for donkey]." Is the situation really that bleak? Price-wise, it certainly isn't pretty. Front-month NYMEX gas is sitting at $4/mcf. Even for the coming winter months, futures prices are only running $4.50. But the fundamentals don't tell…

• Turning $25 of Natural Gas into a $75 Barrel of Oil?

  Natural gas costs about 1/3 the cost of oil in terms of energy content (see graph). What if we could convert natural gas into long chain hydrocarbons and high value chemicals cheaply and cleanly? How would that change the balance of the energies? A cheap and efficient way of turning methane into liquid chemicals and fuels could free the chemical industry from its dependence on pricier and dirtier petroleum. But knocking off one of the four hydrogen atoms arrayed around methane's sole carbon atom requires so much energy that the process tends to run out of control, burning up the…

• Europe Must Triple Efforts to Meet Energy Goals

  The EU must triple its energy efficiency efforts in order to reach its 2020 energy savings target, a policy advisory report says. The Energy Savings 2020 report, commissioned by the Brussels-based European Climate Foundation and US-based Regulatory Assistance Project and written by research groups Ecofys and Fraunhofer, says current EU policy is delivering only one?third of the potential cost-effective savings measures. The report also calls for the introduction of a binding commitment on energy savings. According to the report, energy savings of around 394 million tonnes of oil equivalent (Mtoe) are needed to meet the EU goal of achieving 20%…

• The Hunt for Uranium is On

  Last year Kazakhstan became the world's largest supplier of uranium, overtaking Australia and Canada, at 14,000 tonnes, or one fifth of world production. As supplies of oil are being sought in increasingly inhospitable regions of the globe to meet rising demand against finite supply, the hunt is on for uranium in the face of an emphasis to turn-away from fossil-fuel based power stations and toward nuclear. The statistic is often given that there is about 40 years worth of uranium left, and this is the duration therefore of the provision of nuclear power. In fact, there is much more uranium…

• Worries About Consumer Demand, Deflation Drive Down Oil Prices

  Oil Market Summary for 09/13/2010 to 09/17/2010. Flagging consumer sentiment and renewed concern about deflation sent oil prices into the doldrums this week, as prices dropped 1.2% on Friday to close the week down 3.6%. The benchmark West Texas Intermediate futures contract settled at $73.66 a barrel on Friday, down 91 cents on the day, compared to $76.45 a week ago. A pair of bearish statistics on consumer sentiment and inflation drove down crude oil prices on Friday. The Reuters/University of Michigan consumer sentiment index declined to 66.6 in September from 68.9 in August. Forecasters had been looking for a slight…