IEA: Global Nuclear Capacity Needs To Double To Meet Net-Zero Goals (30 June 2022): By City A.M - Nuclear power capacity needs to double worldwide over the next three decades to reach net-zero carbon emissions targets to ensure energy independence, argued the International Energy Agency (IEA). The Paris-based group’s executive director Fatih Birol outlined that nuclear has a unique opportunity for a revival in the context of the global energy crisis, skyrocketing fossil fuel prices, energy security challenges, and climate commitments. However, he suggested this was not guaranteed, and instead depended on government policy geared toward greater expansion. Birol said: “It will depend on governments putting in place robust policies to ensure safe and sustainable operation of nuclear plants for years to come.” (Source: Oil Price)
The Perfect Storm In Oil Caught Markets Off Guard (18 June 2022): By Irina Slav - Two years ago, at the height of the pandemic, BP wrote in its annual Energy Outlook that global oil demand had peaked at around 100 million bpd in 2019, and it was only going to go down from then on because of the effects of the pandemic and the accelerated energy transition. Just two years later, BP is admitting it may have underestimated the world’s thirst for oil, although it heroically stuck to its long-term forecast that the electrification of transport will eventually usher in the era of peak oil demand. Investment banks, meanwhile, foresaw the rebound in demand because it was the natural thing to happen after the pandemic depression caused by all the lockdowns. What they did not foresee—because it is impossible to foresee—was the extent and speed of the rebound. (Source: Oil Price)
Could Wealthy Nations Fund The Energy Transition In Emerging Markets? (16 June 2022): By Oxford Business Group - As emerging markets continue to add capacity to generate renewable energy, some of the world’s wealthiest countries could help fund their energy transitions. In recent months officials from a number of developed nations have visited Indonesia to discuss the country’s decarbonisation efforts. This included the visit of Janet Yellen, the US secretary of the Treasury, who met with Luhut Binsar Pandjaitan, Indonesia’s coordinating minister for maritime affairs and investment, in late April to discuss the potential for an accelerated transition away from coal in the power sector. The pair also discussed the potential for Indonesia to participate in a Just Energy Transition Partnership (JETP), an initiative that would see donor governments, development banks, climate-focused organisations and the private sector fund projects to accelerate the country’s transition away from fossil fuels. (Source: Oil Price)
Demand Destruction Remains Elusive Despite Inflation (15 June 2022): By Tsvetana Paraskova - The Russian invasion of Ukraine sent oil prices to the highest levels since 2014, but prices were already heading higher before the invasion as producers and refiners were slow to meet the post-COVID jump in demand. Soaring energy prices and inflation are prompting central banks to tighten monetary policy and raise interest rates, which will slow down economic growth. The slowdown in global economic growth now looks inevitable due to aggressive monetary tightening policies, record-high diesel and gasoline prices, and—as a result of the war in Ukraine—additional pressures on food prices and global supply chains. The embargoes on Russian oil in the West are further tightening global fuel markets, while refinery capacity worldwide is now some 3 million barrels per day (bpd) lower than just before the pandemic. (Source: Oil Price)
What Is Holding The Hydrogen Boom Back? (14 June 2022): By Alex Kimani - Hydrogen power has been on the market for decades but has never really been able to break the glass ceiling of mass-market appeal, mainly due to a host of technical and cost issues. But some experts now believe that the hydrogen economy is ready for take-off, with Goldman Sachs predicting hydrogen generation could become a $1 trillion per year market. The EU has hatched a highly ambitious plan to install 40 gigawatts of electrolyzers within its borders and support the development of another 40 gigawatts of green hydrogen in nearby countries that can export to the EU by 2030. The EU has also pledged to cut Russian gas imports by two-thirds by the end of the year and has doubled down on green energy fuels by increasing renewable hydrogen production. (Source: Oil Price)
India And China Take In Russian Oil Unwanted In The West (13 June 2022): By Tsvetana Paraskova - Attracted by cheap prices, India and China continue to increase their imports of Russian crude, which is now mostly banned in the West. India, which wasn’t a big buyer of Russian oil until March this year, has now imported five times the amount of all the Russian crude it bought in the whole of 2021, according to estimates from commodity data firm Kpler cited by The Associated Press. So far this year, India has imported 60 million barrels of crude from Russia, compared to 12 million in Russian oil imports for the entire 2021, per Kpler data. China has also increased its intake of Russian oil, although not as dramatically in percentage hikes as India. China, however, overtook Germany as the largest importer of Russian crude oil anywhere in the world, Finland-based Centre for Research on Energy and Clean Air (CREA) said earlier this month, analyzing Russia’s fossil fuel exports and revenues in the first 100 days since the Russian invasion of Ukraine. (Source: Oil Price)
Biden Tells Exxon To Start Paying Its Taxes (2 June 2022): By Julianne Geiger - With the U.S. Administration growing more desperate by the week as gasoline prices breach $5 per gallon in the United States, President Biden is now taking aim at individual oil and gas companies—namely, ExxonMobil. A Biden statement attempting to address May inflation data contained harsh words—both for the oil industry as a whole and Exxon specifically. "Why aren't they drilling? Because they make more money not producing more oil," he said. "Exxon, start investing and start paying your taxes." The President also said that they would make sure everyone knew how much Exxon was profiting. "Exxon made more money than God last year." To be precise, Exxon's net profit was $23 billion in 2021, making up for the $22.4 billion loss the year prior. Exxon's 2021 profit came in behind Apple, Berkshire Hathaway, Alphabet, Microsoft, JP Morgan Chase, Meta Platforms, Amazon, and Bank of America—and barely eeked out a win over the Federal National Mortgage Association, Fannie Mae. (Source: Oil Price)
The U.S. Solar Boom Is Back On Track (9 June 2022): By Felicity Bradstock - The solar energy industry in the U.S. has grown rapidly over the last decade, second only to wind power. But supply chain issues, made worse by the tariffs on solar panels manufactured in Southeast Asia, have been pushing costs up for the U.S. solar industry. This month, President Biden announced the waiving of certain tariffs on solar imports, sending stocks soaring, and potentially giving the sector a game-changing boost. U.S. solar energy production increased from 1.82 TWh in 2011 to a giant 163.7 TWh in 2021, with significantly more sectoral growth than any renewable source other than wind. Solar photovoltaic (PV) installed capacity is now enough to power around 22 million homes, with solar power accounting for 50 percent of all new electricity-generating capacity added in the first quarter of 2022. (Source: Oil Price)
Biden Invokes Defense Production Act To Bolster Green Energy Independence (8 June 2022): By ZeroHedge - Solar and fuel cell names are going to continue to be on watchlists this week one day after President Biden prioritized the two sources of energy as part of a manufacturing push in the U.S. On Monday, Biden invoked the Defense Production Act, targeting the country's solar production capacity and fuel cell production, among other forms of green energy. It's the latest "drop in the ocean" response to a massive, looming energy cost crisis that has resulted from out of control money printing and geopolitical volatility. The purpose of the Presidential determinations is to "accelerate domestic production of five key energy technologies: (1) solar; (2) transformers and electric grid components; (3) heat pumps; (4) insulation; and (5) electrolyzers, fuel cells, and platinum group metals," the release says. (Source: Oil Price)
Big Oil Set To Win Stakes In Qatar’s Huge LNG Expansion Projects (7 June 2022): By Tsvetana Paraskova - Some of the biggest international oil and gas majors, including ExxonMobil, Shell, and TotalEnergies, are expected to be awarded stakes in the major expansion projects of one of the world’s top LNG exporters, Qatar, sources familiar with the matter told Bloomberg on Tuesday. Qatar announced last year the world’s largest LNG project, which is set to raise Qatar’s LNG production capacity from 77 million tons per annum (mmtpa) to 110 mmtpa. The project, expected to start production in the fourth quarter of 2025, will cost US$28.75 billion. Qatar also plans another expansion phase at the North Field, the world’s largest natural gas field, which it shares with Iran. The second expansion phase will be the North Field South Project (NFS), set to further increase Qatar’s LNG production capacity from 110 mmtpa to 126 mmtpa, with an expected production start date in 2027. (Source: Oil Price)
Citi And Barclays Raise Oil Price Forecasts (6 June 2022): By Julianne Geiger - Two banks—Citi and Barclays—raised their oil price forecasts on Monday, citing the effects of Russian crude oil sanctions and delays in the renewal of the Iran nuclear deal—without which there will be no meaningful increase in crude oil exported from Iran. Citi Research raised its oil price forecast due to heavy delays in securing another Iranian nuclear deal, which will contribute to the tight market conditions for crude oil. Citi now sees sanction relief for Iran coming in the first quarter of 2023, adding 500,000 bpd in the first half and 1.3 million bpd over the second half. This is in contrast to its previous forecast, which assumed Iranian sanctions relief—and therefore additional crude oil—would come sometime mid-2022. Now that we are already in mid-June and the talks appear to have stalled, Citi’s previous scenario looks highly unlikely. Citi’s second-quarter 2022 Brent forecast is now seen at $113 per barrel—up from $99 per barrel in its previous forecast. Citi also raised its Q3 and Q4 forecast to $99 and $85 per barrel, respectively. For 2023, Citi lifted its Brent price forecast to $75—up $16 per barrel. (Source: Oil Price)
Biden Administration Considers A Windfall Tax On Oil And Gas Profits (4 June 2022): By ZeroHedge - The Biden administration is considering a proposal to tax oil and gas windfall profits to provide a gas subsidy for American consumers struggling with high energy prices, said Bharat Ramamurti, deputy director of the National Economic Council at a panel sponsored by the Roosevelt Institute think tank on June 2. The news follows a similar move in the U.K. by Chancellor Rishi Sunak on May 26, to impose a 25 percent windfall tax on North Sea energy producers to provide a 15 billion pound ($18.9 billion) energy fund subsidy for Britons paying for soaring fuel costs. The White House has been examining proposals from Congress that would hike taxes on energy producers in order to provide a subsidy or tax rebate to households. (Source: Oil Price)
Rising U.S. Interest Rates Could Significantly Impact Emerging Markets (2 June 2022): By Oxford Business Group - Following the US Federal Reserve’s decision to raise benchmark interest rates in recent months, analysts are closely tracking the impact this will have on emerging markets and their economies. On May 4 the Federal Reserve raised its benchmark interest rate by 0.5 percentage points to a target range of 0.75-1%, the largest increase since 2000. This followed a 0.25-percentage-point rise in March, the first since December 2018. The decision to lift interest rates comes amid attempts to control inflation in the US, which hit a 40-year high of 8.5% in March. After rates reached historic lows during the pandemic, the Federal Reserve signalled that it will continue to raise them gradually over the coming months in small increments to provide a so-called soft landing for the US economy.
Citi: Oil Is Overvalued By $50 Per Barrel (1 June 2022): By Tom Kool - Brent crude, trading Wednesday at over $116 per barrel, should be closer to $70, according to Citi’s global head of commodity research, Ed Morse, in an interview with Bloomberg. Morse, which has been one of the most bearish pundits saw demand growth at 3.6 million bpd at the beginning of the year. Citing recession fears and economic slowdown, Citi is now estimating that demand growth for oil stands at 2.2 million bpd year-on-year, down 1.4 million bpd from the beginning of 2022. Oil prices have surged some 50% since the beginning of the year, with Russia’s invasion of Ukraine and resulting Western sanctions roiling global energy markets. On Tuesday, a Reuters poll of analysts showed a consensus for Brent prices to average just over $107 per barrel in Q2, with some experts eyeing $130 per barrel in the aftermath of the EU’s partial ban on Russian imports. (Source: Oil Price)