How The Oil Industry Fared Under The Last Nine U.S. Presidents (31 October 2020): By Robert Rapier - With the 2020 presidential election looming — and with many claims and counterclaims about a president’s impact on the oil industry — I thought it might be of interest to review the history of U.S. oil production and consumption over the past 50 years. Here are the highlights from each president’s term in office. Richard Nixon was inaugurated as the 37th president on January 20, 1969. When President Nixon took office, U.S. oil production was nearing a peak after over 100 years of increasing production. Imports made up 10% of U.S. consumption. In 1970, U.S. oil production reached 9.6 million barrels per day (BPD) and began a long, steady decline. Richard Nixon began his second term on January 20, 1973. U.S. oil production had declined to 9.2 million BPD while consumption had increased by 3 million BPD from the first year of Nixon’s first term. As a result, oil imports would more than double during Nixon’s presidency, and American citizens would learn the danger of the dependence on imports with the OPEC oil embargo of 1973. ... (Source: Oil Price)
The Nuclear Power Struggle In The EU (31 October 2020): By Viktor Katona - Reading through the nuclear news of the past weeks, the attentive reader might have come across an under-the-radar dispute of Austria and United Kingdom, perhaps one of the most unfathomable confrontations in Europe, considering the distance and difference in national policies. The crux of the matter is the following: when Britain reversed in 2006 its previous policy of scraping all nuclear power and has made nuclear one of the key components of its carbon-emission reduction strategy, it has set in motion an entire array of countries ardently against building new nuclear assets. When the policy plan evolved into a real prospect of Hinkley Point C, one of the most anti-nuclear nations, Austria, decided to take the issue to European courts, claiming that the UK’s aiding of nuclear projects by means of subsidies contradicts EU norms. (Source: Oil Price)
Oil Sees Worst Month Since March (30 October 2020): By Tom Kool - Oil prices have hit a 5-month low as COVID cases climb, new lockdowns are put in place and reports emerge that OPEC may not maintain its production cut in 2021. Oil prices plunged this week after spending months trapped in a narrow range around $40 per barrel. Renewed national lockdowns in France and Germany rattled financial markets, while the U.S. case count for covid-19 remained at record levels and may continue to rise. “As lockdowns begin to bite on demand concerns across Europe, the near-term outlook for crude starts to deteriorate,” said Stephen Innes, chief global market strategist at Axi. In early trading on Friday, WTI fell to $35 per barrel and Brent was at $37. (Source: Oil Price)
OPEC Members Rebel Over Production Cut Extension (29 October 2020): By Tsvetana Paraskova - While the oil market speculates on whether or not OPEC+ will ease its production cuts in January amid sluggish demand, rumors emerged on Thursday that the three biggest OPEC producers behind Saudi Arabia may not be on board with extending the current cuts into next year. Iraq, the United Arab Emirates (UAE), and Kuwait - the biggest OPEC producers behind Saudi Arabia – are reportedly not particularly inclined to support a rollover of the cuts of 7.7 million barrels per day (bpd), because such cuts are too deep for their economies and budget incomes to sustain. This news came from Reuters on Thursday, quoting sources in OPEC and the industry. Sources in OPEC told Reuters that the two leaders of the OPEC+ pact, Saudi Arabia and Russia, would be inclined to favor rolling over the cuts of 7.7 million bpd in 2021, instead of easing them by 2 million bpd as set in the current OPEC+ production agreement. (Source: Oil Price)
The Green Hydrogen Problem That No One Is Talking About (28 October 2020): By Irina Slav - Gigawatt upon gigawatt of green hydrogen capacity is being planned across Europe, Asia, and Australia. According to proponents of the technology, green hydrogen - the kind produced through electrolysis powered by solar, wind, and other renewable energy sources - is the best way to decarbonize heavy polluter industries. There is much talk about the falling costs of solar and wind and how they will make green hydrogen viable very soon. What nobody seems to want to talk about is water. Electrolysis is the process of breaking down water into its constituent elements - hydrogen and oxygen - using an electric current. The process is performed in an installation called an electrolyzer. When hydrogen advocates talk about the bright future of the technology, they focus on the costs associated with the electricity needed for the electrolysis. But electrolysis, besides electricity, needs water. Tons of water - literally. (Source: Oil Price)
Wall Street’s Hottest Fund Is Going All In On This $4 Trillion Market (26 October 2020): By Paul Reed - Blackrock, considered by many to be the undisputed king of Wall Street with $6.5 trillion in assets under management, hasn’t just gone off dirty fossil fuels ... It also appears to be going off meat, another of the industries that is being spurned by the multi-trillion-dollar ESG movement. Blackrock recently upped the ante on this megatrend by bumping its iShares Total U.S. Stock Market Index Fund stake in plant-based meat superpower, Beyond Meat (NYSE:BYND) by another 15.76%. (Source: Oil Price)
BP CEO: Second Wave Of COVID Hits Oil Demand Harder Than Expected (26 October 2020): By Tsvetana Paraskova - The second wave of coronavirus cases in the world is impacting global oil demand “maybe a little bit more than we thought” in the second half of this year, BP’s chief executive Bernard Looney said on the virtual 2020 India Energy Forum by CERAWeek on Monday. In terms of oil demand, undoubtedly there has been an impact this year, “probably less than we thought in the first half of the year, and maybe a little bit more than we thought in the second half of the year as the second wave of infections come in around the world,” Looney said. It is probably too early to assess the true impact, especially for the medium to long term, he noted, but added that there would be some impact. Oil has been hit harder than other fuels, BP’s top executive said. Speaking about peak oil demand, Looney said that “peaking of oil demand does not mean the end of oil. Oil will be around for a very, very long time.” (Source: Oil Price)
The U.S. Has A Major EV Problem (24 October 2020): By Tsvetana Paraskova - Even a battery with a million-mile lifespan can’t overcome one of the key hurdles to mass adoption of electric vehicles (EVs) in the United States and elsewhere—the insufficient public charging infrastructure. The EV revolution is not only about car performance, choice availability, or price parity with internal combustion engine (ICE) vehicles. It also hinges on easy access to charging infrastructure to allay customer fears that they could be left stranded without battery power and without a charging point nearby. EV infrastructure in the United States is expanding, but it needs a lot more expansion and investments to be ready for EVs to increase their market share. Even California, the leader in EV sales and Tesla’s largest U.S. market, has recognized that it needs to fill the gap in charging infrastructure if it is to meet California Governor Gavin Newsom’s target of phasing out the sale of new gasoline-fueled passenger vehicles by 2035. (Source: Oil Price)
Nuclear Energy Granted A State-Sponsored Lifeline In The U.S. (24 October 2020): By Haley Zaremba - For the past several decades, the United States has been the poster child for the ailing state of the nuclear industry. The nuclear sector in the U.S. is plagued by aging infrastructure, mounting debts, dependence on government handouts, and the staggering cost of maintaining spent nuclear fuel. What’s more, it’s had to compete with the homegrown shale revolution, and expensive nuclear is simply no match for the tidal wave of cheap shale oil and gas that came flooding out of the West Texas Permian Basin. (Source: Oil Price)
Biden Says He Would “Transition From The Oil Industry” (23 October 2020) By Charles Kennedy - “I would transition from the oil industry, yes,” Democratic presidential candidate Joe Biden said during last night’s debate with President Donald Trump in response to a question from his opponent. “Would he close down the oil industry?” Trump asked Biden, as quoted by the National Review. “Would you close down the oil industry?” To this, President Trump’s opponent mentioned his plan for a transition away from oil, to which Trump said, “That’s a big statement.” “It is a big statement, because…the oil industry pollutes, significantly,” Biden responded. “It has to be replaced by renewable energy over time.” “And I’d stop giving to the oil industry—I’d stop giving them federal subsidies,” the Democratic candidate continued. “[Trump] won’t give federal subsidies to solar and wind. Why are we giving it to the oil industry?” (Source: Oil Price)
World Bank Sees Oil Average $44 in 2021 (22 October 2020): By Tsvetana Paraskova - Energy prices suffered the most among commodities in the pandemic—especially oil prices—and they won’t be rising much next year either, averaging just $44 a barrel, the World Bank said in its semi-annual Commodity Markets Outlook report on Thursday. While agricultural and metal commodities have already recouped losses from COVID-19, oil prices will not recover to pre-pandemic levels at least until 2022, according to the World Bank. “Notwithstanding steep production cuts, the recovery in oil prices has stalled recently amid concerns about renewed COVID-19 infections and their impact on oil consumption,” the bank said in its report. Next year, oil demand in almost all countries will still be lower than in 2019, except in China, and as a result, oil prices will not move much higher than today’s levels in the low $40s. (Source: Oil Price)
Global Oil Production Costs Continue To Fall (21 October 2020): By Rystad Energy - A comprehensive Rystad Energy analysis of oil production costs has revealed that the average breakeven price for all unsanctioned projects has dropped to around $50 per barrel, down around 10% over the last two years, and 35% since 2014. This means that oil is much cheaper to produce now compared to six years ago, with the clear cost savings winner being new offshore deepwater developments. Our cost of supply curve for liquids now reveals that the required oil price for producing 100 million barrels per day (bpd) in 2025 has been in continuous decline in recent years, with our updated projection showing that an oil price of only $50 per barrel is needed to keep oil production at this level. Previously, in 2014, we had estimated that the required oil price for producing 100 million barrels per day in 2025 was close to $90 per barrel, an estimate which we then revised in 2018 to around $55 per barrel. (Source: Oil Price)
Oil Demand Growth Won’t Be Saved By Petrochemical Boom (20 Actober 2020): By Tsvetana Paraskova - The pandemic hit the chemical-driven profit margins of integrated oil companies and petrochemical manufacturers to the point that many firms slashed capital expenditures and deferred petrochemical projects for better times. The safe bet on petrochemicals suddenly became not so safe as demand from industries slumped with COVID-19, and the crash in oil prices added to the pressure on margins. In the United States, petrochemicals supply had exceeded demand even before the pandemic, and the coronavirus further skewed the balance into an oversupply. Major U.S. petrochemical manufacturers continue to believe that strong demand recovery in the latter part of 2021 and from 2022 onwards will continue to underpin a strong petrochemical business going forward, despite the pandemic-induced slump this year. OPEC also believes that it will be none other than the petrochemicals sector that will be the single largest growth driver of global oil demand through 2045—even if total world oil demand plateaus before then. (Source: Oil Price)
IMF Sees Oil Prices At $40-50 Next Year (19 October 2020): By Tsvetana Paraskova - Oil prices are not expected to rise much next year, and will stay in the $40-50 a barrel range, putting additional pressure on the oil exporters in the Middle East, the International Monetary Fund (IMF) said on Monday in its update on the Regional Economic Outlook for the Middle East and Central Asia. Gross domestic product in the region is set to drop by 4.1 percent this year, a downward revision of 1.3 percentage points compared with IMF’s forecast in April 2020. The economies in the oil exporters in the Middle East and North Africa are expected to suffer more and shrink by 6.6 percent this year, according to the IMF. The six countries in the Gulf Cooperation Council (GCC)—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE)—will see their economies slump by 6.0 percent in 2020, before rising by 2.3 percent in 2021. (Source:Oil Price)
How Long Will China Continue To Prop Up The Oil Market? (18 October 2020): By Tsvetana Paraskova - China has played a significant role in supporting global oil demand recovery in recent months by importing its highest-on-record crude volumes since May. Customs import data from the world’s top oil importer continue to show strong arrivals of crude as ports and customs continue to process cargoes that have waited for weeks to discharge. However, with demand recovery in the rest of Asia still wobbling and refining margins in the region still depressed, the oil market and oil analysts have one primary concern about demand on their minds. How long can China support the fragile global oil market, when backlogged cargoes are finally processed and demand outside China is still weak, with the outlook getting weaker as the second wave of coronavirus infections is sweeping across major developed economies? Over the past five months, China’s crude oil imports haven’t fallen below 11 million barrels per day (bpd), with June arrivals of 12.9 million bpd smashing the previous record from May by more than 1.5 million bpd. (Source: Oil Price)
Has The Gold Rally Run Out Of Steam? (17 October 2020): By Arkadiusz Sieron - Inflation remains low and below the Fed’s target. So, should gold bulls worry about it? The U.S. CPI inflation rate rose by 0.2 percent in September, following a 0.4 percent increase in August. It was the smallest jump since May. The move was driven by a 6.7- percent spike in the cost of used cars and trucks, and it’s the most significant upward change over half a century. The core CPI rose 0.2 percent, following a 0.4 percent increase in the preceding month. On an annual basis, the overall CPI increased 1.4 percent (seasonally adjusted), following a 1.3 percent increase in August. The core CPI rose 1.7 percent, much like in the month prior (or a bit less if we abstract from rounding). Therefore, as the chart below shows, the period of disinflation perhaps ended, but the inflation remains low. It seems that even though the inflation rate has reached the bottom in May or June, the outbreak of high inflation in the near future is unlikely. (Source: Oil Price)
Natural Gas Is Booming In Africa (16 October 2020): By Haley Zaremba - In 2018, while much of the world was leaving coal-fired power in the past and moving toward greener pastures (so to speak) coal was barreling full steam ahead in the African continent. In North Africa in particular, 2018 saw a flurry of thermal energy projects and brand-new coal fired plants. First, “Siemens completed the world’s three biggest combined-cycle gas-fired plants for Egyptian Electricity Holding Company: Beni Suef, New Capital and Burullus, which collectively provide a colossal 14.4 GW in new capacity.” Then, in the same year, another 1.4 GW of coal-fired energy came online in Morocco courtesy of the new Safi plant. Far from being the beginning of a renaissance for a fossil fuel that has largely fallen out of favor, however, that very well may have been coal’s last hurrah in Africa. With Morocco and Egypt in particular, both countries are increasingly embracing natural gas and renewable energies, and according to reporting by African Business, “it is likely that such big thermal projects will become increasingly rare.” In fact, this is likely not just limited to North Africa but to the entire African continent: “This could be an Africa-wide process in the case of coal, as its forecast rise as an African generation feedstock seems to be fizzling out,” reports African Business. (Source: Oil Price)
The World’s Growing Nuclear Waste Dilemma (15 October 2020): By Haley Zaremba - Nuclear energy has long been touted as a promising form of energy production for a decarbonizing global economy. Nuclear power is efficient, it’s established, and it has zero carbon emissions. Indeed, some countries, most notably China, have included nuclear energy as a major part of their national plan for decreasing their carbon footprint. For all of nuclear energy’s benefits, however, nuclear energy production also has some serious drawbacks. While nuclear meltdown is extremely rare, its horrific consequences loom large in the public imagination. High-profile tragedies like the disasters at Chernobyl, Fukushima, and Three-Mile Island have made nuclear a tough sell for those of us who, understandably, do not want a nuclear power plant in our backyard. We’ve all seen the Simpsons, and we prefer our fish with just two eyes, thanks. (Source: Oil Price)
Saudi Aramco Sees Tighter Oil Markets In 2022 (14 October 2020): By Irina Slav - Aramco expects oil demand to rebound to pre-pandemic levels by 2022 while supply tightens, creating a deficit, the chief executive of the Saudi state energy giant told Energy Intelligence. China is once again the focus of attention. According to Amin Nasser, it will account for most of the rebound, along with other developing countries in East Asia and other parts of the world. On the supply side, however, Nasser warned that spending cuts could create a shortage, and it won't be a short-term affair. "Yes, there is a concern that we might end up with a supply crunch over the mid to long term if this level of investment is not corrected looking forward," the executive told Energy Intelligence's Amena Bakr. The industry has cut about a third of its spending from last year's level. (Source: Oil Price)
The Real Reason China Is Betting Big On Renewables (13 October 2020): By Haley Zaremba - The energy and environmental sectors are still abuzz with the ambitious carbon neutrality plan announced by Beijing almost a month ago. Chinese President Xi Jinping announced that China would double down on its climate commitments and reduce its massive carbon footprint to net zero emissions by just 2060. At the U.N. general assembly, Xi announced that in addition to this extremely ambitious goal, his country would also reach peak emissions in just a decade, by 2030. While the rhetoric around this decision is largely based on climate change and reducing negative environmental externalities, however, the target set by China may actually have more to do with China’s energy security than anything else. “Debate over energy policy in China centers around the country’s resilience against supply chain uncertainties,” World Politics Review reported last week, referring to energy security as China’s “fundamental domestic objective.” (Source: Oil Price)
Middle East Natural Gas Megaprojects Face Major Risks (12 October 2020): By Cyril Widdershoven - In a new report, the Arab Petroleum Investment Corporation (Apicorp), the investment fund of the Organization of Arab Petroleum Exporting Countries (OAPEC), states that the ongoing oil market crisis and COVID issues did not have a detrimental effect on committed gas investments in the Middle East and North African (MENA) region. Apicorp reports that gas investments have been steady in comparison to 2019 with planned investments showing an increase of 29% to reach $126 billion. The main driver for the current increase in investment is a regional drive for cleaner power generation and the use of natural gas and condensates as a feedstock for the petrochemicals industry. In its MENA Gas & Petrochemicals Investments Outlook 2020-2024, Apicorp reports on the MENA region’ planned and committed investments for the period 2020 to 2024. Remarkably, somehow contrary to overall global developments, the region’s petrochemicals sector shows an y-o-y increase of US$4 billion in planned projects in comparison to 2019. At the same time, total committed projects showed a decrease of US$13 billion, this is largely caused by completion of several projects in 2019. Apicorp’s report also indicated that the share of government investments in committed and planned gas projects (92%) is higher than it is in the petrochemicals sector (72%). (Source: Oil Price)
Why Nuclear Fusion Remains Our Best Bet For 100% Clean Energy (11 October 2020): By Alex Kimani - Long relegated to the trash heap of utopic clean energy technologies in the realm of harvesting energy from black holes, nuclear fusion is suddenly making a big comeback--and for good reason. Fusion is not only ultra-powerful, but it is also the cleanest and virtually limitless energy source known to man. In fact, nuclear fusion is pretty much our perfect energy source that is not only likely to play an outsized role in the shift from ‘dirty’ fossil fuels to clean energy but also power the conquest of our Final Frontier: Space. Fusion energy has the potential to produce the safest energy with no greenhouse gases and no long-lived radioactive wastes. Yet, somehow, practical nuclear fusion energy on our planet has remained a far off mirage. But finally, this elusive energy source could be closer to becoming an everyday reality than we imagine. (Source: Oil Price)
Is This The World’s First ‘’Intelligent’’ Car Battery? (10 October 2015): By MINING.com - Slovakia’s InoBat Auto has unveiled what it claims is the world’s first “intelligent” electric vehicle battery, said to beat competitors’ with a higher energy density and an increase in operational range of 20%. The company’s Gen1 lithium battery, ready after just a year of research and development, combines Artificial Intelligence (AI) and High Throughput (HTP) technology. It also contains less cobalt than batteries currently available in the market, InoBat’s co-founder and CEO, Marian Bocek, said in a statement. The company, backed by a consortium of investors and technology companies, will begin producing the battery next year at its AI-driven battery research centre and production line in Voderady, Slovakia. InoBat is also advancing plans to build a EUR 1 billion ($1.2bn) 10 GWh Gigafactory, which would have the potential to generate 240,000 intelligent batteries in 2025. (Source: Oil Price)
MIT Scientists: Nuclear Fusion Energy Could Be Closer Than Thought (4 October 2020): By Tsvetana Paraskova - The decades-old dream of many scientists and science fiction writers may come true at some point over the next decade. Researchers at MIT and a startup spun out of MIT are working on a nuclear fusion experiment, which they are fairly certain will achieve its goal of creating a hot burning plasma to produce for the first time ever fusion energy more than the energy consumed to generate that fusion energy. Nuclear fusion has long been considered the answer to zero-emission by-product-free energy generation. However, no one has cracked the nuclear fusion code yet because of the challenges associated with the environment in which the process could take place. Fusion is the natural process that heats the Sun and all other stars, in which a huge amount of energy is produced by the fusion of light atoms, such as those in hydrogen, into heavier elements like helium. (Source: Oil Price)
China’s Clean Energy Plan Could Cost It $5 Trillion (8 October 2020): By Irina Slav - China’s plan to reach carbon neutrality by 2060 could end up costing it $5 trillion, Wood Mackenzie analysts have said in a new report. “The hefty bill is the total sum required for additional power generation capacity to accommodate the growth in electrification by 2050,” they noted. China is the biggest emitter of carbon dioxide but it is also the biggest investor in renewable energy projects. However, the country’s emissions are still on the rise and they will only peak in 2030, under current decarbonization plans. Europe has asked China to try and accelerate the decarbonization push, moving peak emissions to 2025. Last month, Beijing announced plans to become carbon neutral by 2060. "We aim to have CO2 emissions peak before 2030 and achieve carbon neutrality before 2060," President Xi Jinping told the United Nations General Assembly. (Source: Oil Price)
The Increasingly Bullish Case For Gold (7 October 2020): By Arkadiusz Sieron - We all know that the second quarter was disastrous for the US economy. And now, it’s official. Last week, the Bureau of Economic Analysis published the third real GDP estimate in the Q2. According to the report, the real GDP decreased at an annual rate of 31.4 percent (slightly better than the second estimate of 31.7-percent plunge), or 9 percent more from the previous quarter and the second quarter of 2019, as the chart below shows. In other words, the US economy has suffered the sharpest contraction since the government started keeping records in 1947. Although the report sounds devastating, since it is also terribly old news, nobody really cares, while market players are always future-oriented and focused on a fast recovery. And indeed, the data is encouraging. For example, the consumer Confidence Index has jumped from 86.3 in August to 101.8 in September, which is the highest level since the pandemic started. (Source: Oil Price)
Natural Gas Offers Lifeline For Distressed Gulf Oil Giants (6 October 2020): By Alex Kimani - Their budgets just don't add up anymore. Oil-rich Arab nations are in the throes of a deep economic crisis and facing gaping holes in their finances. Saudi Arabia needs the price of Brent crude to rise to $76 dollars a barrel while UAE needs it to hit $69, Bahrain $96, and Oman $87 to balance their books. Save for tiny Qatar, no Arab oil producer can balance its books at the current price of $40/barrel. GCC nations are now facing huge fiscal deficits, with Kuwait's deficit of ~40% of GDP the highest in the world. To make matters worse, once free-flowing credit lines have started to shut down for some. A good case in point is Oman, which is struggling to borrow after credit-rating agencies listed its debt as junk. Jordan had to plead to receive a $2.5bn aid package from the Gulf, only half of what it got eight years ago. Meanwhile, no one from the Gulf appears willing to bail out cash-strapped Egypt or Lebanon. (Source: Oil Price)
70% Of Lost U.S. Oil Jobs May Not Return Anytime Soon (5 October 2020): By Tsvetana Paraskova - As much as 70 percent of the more than 100,000 jobs lost in the U.S. oil, gas, and chemicals industries due to the pandemic may not return by the end of 2021, Deloitte said in an analysis on Monday. Since the previous oil price crash of 2014, employment in the oil, gas, and chemical sectors (OG&C) has become much more sensitive to changes in crude oil prices due to the short-cycle investment and production in the U.S. shale patch, Deloitte noted. “Our multivariate statistical analysis on employment and market data suggests that as much as 70% of jobs lost during the pandemic may not come back by the end of 2021 in a consensus business-as-usual scenario,” Deloitte analysts led by Duane Dickson, US Oil, Gas & Chemicals leader, wrote in the analysis. According to Deloitte’s analysis of U.S. Bureau of Labor Statistics data, the OG&C industry laid off about 107,000 workers between March and August 2020, apart from widespread furloughs and pay cuts. The lay-offs were the fastest in the industry due to the economic slowdown and the oil price crash in the COVID-19 pandemic. (Source: Oil Price)
Does Cryptocurrency Really Run On Clean Energy? (4 October 2020): By Haley Zaremba - In the past, cryptocurrency mining operations, especially that of Bitcoin, have gotten a lot of flack for consuming jaw-dropping amounts of energy. Bitcoin alone consumes more energy each year than the entire country of Switzerland. To help illustrate the extremity of Bitcoin’s energy consumption, the University of Cambridge created an online tool that allows users to view Bitcoin’s energy consumption side by side with that of other entities. When this platform debuted, the tool showed that “Bitcoin is using around seven gigawatts of electricity, equal to 0.21% of the world's supply,” according to a BBC report, a figure that translates to “as much power as would be generated by seven Dungeness nuclear power plants at once.” However, critics of these damning reports have argued that the energy consumption of Bitcoin and of cryptocurrencies, in general, are overly harsh and not entirely representative of the whole story. Yes, cryptocurrency consumes a huge amount of energy, the argument goes, but the majority of that energy comes from renewable resources. (Source: Oil Price)
What Will Happen To Gold Under The Fed’s New Monetary Framework? (3 October 2020): By Arkadiusz Sieron - Did you believe that the monetary policy of Ben Bernanke in a response to the Great Recession was extraordinary? Nah, Bernanke was an amateur compared to Jerome Powell. The latter quickly reintroduced ZIRP, implemented unlimited quantitative easing, and provided bailouts to Wall Street – and now he risks higher inflation as a result. In August 2020, Federal Reserve Chair Jerome Powell delivered his Jackson Hole speech, unveiling a new monetary framework in the process. He announced a flexible average inflation targeting strategy (FAIT). The new regime implies that when the inflation undershoots its target in one period, the US central bank will try to push inflation above the target in the next period to compensate for the previous shortfalls. In other words, after periods of persistently low inflation, the Fed “will likely aim to achieve an inflation moderately above 2 percent for some time,” as said in the amended Statement on Longer-Run Goals and Monetary Policy Strategy. (Source: Oil Price)
Oil Falls As Trump Tests Positive For COVID-19 (2 October 2020): By Irina Slav - Crude oil prices took a nosedive today after President Donald Trump tweeted late last night that both he and the first lady had tested positive for Covid-19. Brent crude slipped below $40 in Asian and European trading, and West Texas Intermediate stayed below $38 a barrel, after falling earlier this week. Oil was already on the decline earlier this week, weighed down by renewed fears about demand recovery as new Covid-19 cases continued rising fast in Europe, the U.S., and India. The global total passed 34 million this week, up by a million from a week earlier. The death toll from the disease passed the 1-million mark this week as well. In more bearish news, the U.S. Congress continued failing to strike a bipartisan deal on further financial stimulus. The only development in this direction was the House approving a Democrat-proposed bill for an additional $2.2-trillion in stimulus that is likely to hit a wall in the Senate. (Source: Oil Price)
Carbon Capture Is A Critical Part Of Our Energy Future (1 October 2020): By Tsvetana Paraskova - Net-zero goals cannot be met by rising renewable energy usage and wider adoption of electrification in transport alone. The world will need to reduce the emissions from existing energy systems and from heavy industries such as cement, steel, or chemicals production if it hopes to meet the ambitious climate goals and stick to the target in the Paris Agreement to limit global temperature rise well below 2 degrees Celsius. The decarbonization of the energy infrastructure, the reduction of greenhouse gas (GHG) emissions in heavy industries, and the production of low-carbon hydrogen will be virtually impossible without carbon capture, utilization, and storage (CCUS), the International Energy Agency (IEA) said in a new report. Strengthened climate goals and increased government support have created in recent years a new momentum for CCUS to become a large-scale, cost-effective solution to reduce emissions in many carbon-intensive industries. (Source: Oil Price)