Kremlin Calls Nord Stream Attacks State-Sponsored “Terrorism” (29 September 2022): By Alex Kimani - Four days after leaks spewing gas into the Baltic Sea were first spotted, Russia is blaming the incident on state-sponsored "terrorism”. “This looks like an act of terrorism, possibly on a state level. It is very difficult to imagine that such an act of a terrorism could have happened without the involvement of a state of some kind," Kremlin spokesman Dmitry Peskov said, as reported by Reuters. Three leaks--one in the Swedish zone and two in the Danish zone and--were discovered earlier this week in Nord Stream 1 and 2 pipelines designed to ship natural gas to Germany. On Thursday, Sweden said its coast guard had found a fourth leak. Russia has also launched a thinly-veiled allusion to the United States, saying the U.S. stood to benefit, in a war of words with the West, over who was responsible. Moscow has previously said the leaks occurred in territory that is "fully under the control" of U.S. intelligence agencies. (Source: Oil Price)
Oil Executives: Prices Don’t Reflect Tight Supply (28 September 2022): By Charles Kennedy - Oil and gas executives polled by the Dallas Fed in a survey released Wednesday fear recession and supply shortages, with optimism waning this quarter despite solid business activity. Oil and gas executives told the Dallas Fed that recession remains a key concern amid heightened uncertainty. “It’s tough to tell where these crosscurrents are headed. On one hand, we don’t know if anyone has noticed, but the two-year to 10-year Treasury yield curve is inverted, implying recession, and China is on lockdown basically every other day, so that means lower prices in the near term (probably),” one executive commented. However, the same executive noted, while long-term demand is strong and OPEC continues to underperform, “shale core exhaustion” and inventory concerns remain key issues. (source: Oil Price)
Oil Prices Are About To Reverse Course (26 September 2022): By Irina Slav - “That would be the road to hell for America,” JP Morgan’s CEO Jamie Dimon said last week, referring to a suggestion that all big banks divest from the oil and gas industry. In the same week, Aramco’s chief executive warned that years of underinvestment in new oil production are beginning to bear fruit, which is an undersupplied market. Despite these statements that suggested oil prices should move higher, oil fell for much of the week. Yet it wasn’t dragged down by fundamentals. Oil prices are down because many traders and investors are bracing for a recession. The bad news is that even in a recession, oil prices can go higher, and this is exactly what some of those banks that kept JP Morgan company at last week’s Congress hearing expected. Actually, JP Morgan was one of the bullish forecasters. Last week, the banking major’s analysts wrote in a note that they expected Brent crude to rebound to $101 in the fourth quarter. The analysts cited tighter supply as the reason for their forecast. (Source: Oil Price)
Is The Nuclear Waste Problem Overblown? (26 September 2022): By Robert Rapier - In fact, Finland is currently developing the world’s first permanent disposal site for high-level nuclear waste on an island off Finland’s west coast. The waste will be buried in about 100 tunnels about 1,400 feet underground. The facility is projected to hold all of Finland’s nuclear waste until about the year 2100, and is meant to contain spent fuel rods for 100,000 years. The design relies on multiple barriers designed to prevent water from reaching the waste and carrying it into the water supply. It is expected to begin operating next year. A different approach is recycling nuclear waste to recover fissile and fertile materials for additional power production from nuclear power plants. Reprocessing nuclear waste allows for the recovery of plutonium, which is then mixed with depleted uranium oxide to make fresh fuel. This process reduces the volume of high-level waste (HLW) by about 85%, while extracting up to 30% more energy from the uranium. It also reduces the amount of uranium that has to be mined. (Source: Oil Price)
A New Design For Faster Hydrogen Storage (25 September 2022): By Brian Westenhaus - University of Technology Sydney (UTS) and Queensland University of Technology (QUT) researchers have announced a new design for solid-state hydrogen storage that could significantly reduce charging times. Hydrogen is gaining significant attention as an efficient way to store ‘green energy’ from renewables such as wind and solar. Compressed gas is the most common form of hydrogen storage, however it can also be stored in a liquid or solid state. Dr Saidul Islam, from the University of Technology Sydney, explained solid hydrogen storage, and in particular metal hydride, is attracting interest because it is safer, more compact, and lower cost than compressed gas or liquid, and it can reversibly absorb and release hydrogen. (Source: Oil Price)
High Energy Prices Could Cause Manufacturers To Flee Europe (22 September 2022): By Irina Slav - Soaring energy costs in Europe are shutting down businesses and threatening a bloc-wide recession. Yet not everyone accepts this fate. Some companies are moving to cheaper locations: the U.S. Steel giant ArcelorMittal said earlier this month that it would slash by half production at a steel mill in Germany and a unit at another plant, also in Germany. The company said it had based the decision on high gas prices. Separately, ArcelorMittal more recently warned it expected its steel output for the fourth quarter of the year to be 1.5 million tons lower than it was in the final quarter of 2023, again citing excessive prices along with slumping demand. (Source: Oil Price)
EU Emergency Energy Plan Is Bad News For Renewables (21 September 2022): By Rystad Energy - The European Union’s emergency measures to tackle the region’s energy crisis may fall short of their intended goals, at least where renewable energy ambitions are concerned, according to Rystad Energy research. The EU’s proposal to temporarily cap the revenues of inframarginal electricity producers is aimed at capturing the windfall profits of renewable energy producers, which are benefitting from low production costs during this episode of high electricity prices. However, research by Rystad Energy reveals that about 60% of the total installed renewable energy capacity in the EU derives its revenues from fixed-rate contracts agreed well before the energy crisis – with prices generally below current spot prices.?According to the EU Commission, an estimated €117 billion would likely be collected by implementing a revenue cap on low carbon and coal power generation, but the windfall profits described by the EU account for only 40% of renewable energy producers. Indeed, the revenue distribution of installed capacity in Europe shows that less than half of the generation capacity would fall under the aims of the revenue cap policy. (Source: Oil Price)
Organic Solar Cell Breakthrough Improves Performance And Stability (20 September 2022): By Brian Westenhaus - Gwangju Institute of Science and Technology (GIST) scientists use a water treatment for morphology control in the fabrication of active layer thin films, improving the performance and stability of large-area organic solar cells. Morphology control is essentially about making and placing very small particles in their working position. Albeit somewhat a simplified description, as miniaturization becomes micro miniaturization and now molecule, crystal and sometimes even atom placement, the process engineering efforts are getting very challenging indeed. The efforts have been ongoing for decades. These are basic problems that sometimes simply stop great ideas from getting to market. Until now a lack of morphology control of the active layer made it challenging to develop organic solar cells (OSCs) with large active areas. (Source: Oil Price)
New Energy Harvesting Tech Could Bring Power To Remote Regions (19 September 2022): By Brian Westenhaus - DGIST (Daegu Gyeongbuk Institute of Science and Technology in Korea) researchers developed a piezoelectric polymer/ceramic composite fiber with a cross-sectional form that is uniformly controlled to allow the use of energy harvesting technologies that can recycle energy wasted or consumed in everyday life. The results of this study have been published in Nano Energy. Piezoelectric fiber can produce electrical energy through the piezoelectric effect of the material and drive wearable electronic devices through the wearer's movement. However, most of the piezoelectric fibers developed so far are made of nanofibers, meaning that it is difficult to control the shape of the fibers and that the fibers are weak, thus hindering their commercialization. In addition, there are very few studies on the relationship between the shape of the fiber material and the piezoelectric performance. (Source: Oil Price)
What Iran Should Do If JCPOA Fails (16 September 2022): By James Durso - The negotiations to revive the Joint Comprehensive Plan of Action (JCPOA) between Iran and the P5+1 (China, France, Russia, the United Kingdom, the United States, and Germany) are, to use a current term, “under medical supervision.” Iranian Foreign Minister Hossein Amirabdollahian declared that a successful agreement requires Washington’s “realism and determination.” United States (U.S.) Secretary of State Antony Blinken said a deal is “unlikely.” France, Germany and the United Kingdom said they would consult with their partners about Iran’s “continued nuclear escalation and lack of cooperation.” And the United Nations said flexibility from all parties is necessary. Israel’s spy chief added that the Jewish state won’t “stand idly by” while Iran forges ahead with its nuclear program. We may never know for sure if one side, or both sides, thought conflict was more lucrative than getting to an agreement and let the negotiations founder - while blaming the other, of course. (Source: Oil Price)
The Oil Market Isn’t Broken, It’s Just Responding To A Supply Surplus (15 September 2022): By Alex Kimani - As oil prices continue to plunge, with the latest selloff triggered by a surprise crude build and another release from the Strategic Petroleum Reserve, commodity analysts at Standard Chartered say the oil market is not fundamentally broken but is rather merely responding to a surplus. In its latest commodities market update on Thursday, StanChart says that the global oil market is currently in excess supply, with the U.S. transferring an average 0.83 million barrels per day (mb/d) into commercial inventories in the third quarter. StanChart analysts estimate the Q3 surplus at 1.82 million barrels per day, and suggest that forecasts–notably from U.S. investment banks–that were indicating the potential for $150 oil were wrong and that the market “has not yet fully priced in the extent to which that assumption proved wrong”. (Source: Oil Price)
Water And Energy Shortages Are Fueling A Global Food Crisis (14 September 2022): By Haley Zaremba - The Colorado River drought is so bad you can see it from space. Lake Powell and Lake Mead, which supply drinking water to millions of people in Colorado, New Mexico, Utah, Wyoming, Nevada, Arizona, and California, are each currently down to just 27% of their capacity, a near-complete collapse from being 95% full in 2000. In China, record heatwaves and drought have dried up the Yangtze River. Yale Environment 360 is warning that the drying up of Europe’s great rivers, which function as the arteries of the continent's economy, could be the new normal. Nearly two-thirds of the world’s population, or about four billion people, suffer from severe water scarcity for at least one month each year, and half of the global population could face water scarcity by just 2025. This is terrifying for a wide number of reasons. (Source: Oil Price)
Russia’s Energy Blackmail Is Backfiring (13 September 2022): By The Jamestown Foundation - In early September 2022, Russian President Vladimir Putin spelled out his intention to punish Europe for resisting Russia’s assault on the world order and supporting Ukraine louder and clearer than ever before. Speaking at the high session of an economic forum in Vladivostok, Russia, Putin asserted that the confrontation in Ukraine has reinforced Russia’s sovereignty, so in reality, it stands to gain from deepened global polarization and has suffered no significant losses (Nezavisimaya gazeta, September 7). He described the proposal to enforce a price cap on oil and gas exported from Russia as “dumb” and threatened to halt all energy supplies if approved by the European Union (Kommersant, September 7). Putin’s scorn for Europeans, who in his opinion are not in the position to dictate rules and conditions, is underpinned by the presumption of their panic over deepening economic hardships. A hard winter may be looming for Europe, but Putin has ordered the Nord Stream One gas pipeline shutdown to Germany too early, giving the EU plenty of time to prepare emergency measures (Forbes.ru, September 6). Mainstream commentators in Moscow argue that economic prosperity in key EU member states cannot be sustained without large-volume energy ties with Russia (Rossiiskaya gazeta, September 6). This wishful thinking is disproved by careful EU efforts at fitting immediate responses to Russian energy blackmail into the strategy of eliminating dependence on this unacceptable supplier altogether (Rosbalt, September 6). (Source: Oil Price)
Why The EU Is Struggling To Bring Its Energy Crisis Under Control (12 September 2022): By Irina Slav - Last Friday, the energy ministers of the 27 EU members met for an emergency discussion of the energy supply situation in the bloc. The one thing they agreed on was implementing a ceiling on the revenues of power utilities that do not use gas to generate power. What they did not agree on was everything else the Commission suggested last week, including a price cap on Russian gas, a cap on final energy prices, and a direct intervention in EU electricity markets. It's hard to get 27 countries to agree on so many things without any compromise. This is why the EU's survival plans for the winter may never work as intended. Last week, the European Commission, headed by Ursula von der Leyen, proposed that EU member states impose a price cap on Russian natural gas imports, a mandatory cut in energy consumption across the bloc, and a cap on the revenues of power utilities that do not use gas. (source: Oil Price)
Why Europe Won’t Exploit Its Huge Gas Reserves (11 September 2022): By Alex Kimani - As energy prices continue to soar across Europe, with gas prices surging 26% on Monday after Russia stopped pumping via Nord Stream 1, the highly contentious fracking debate is now re-emerging on the continent, led by a new British prime minister with fossil fuels on her mind. The European Union–which no longer includes the UK–plans to replace two-thirds of Russian gas imports by the end of the year, though analysts warn that the bloc’s best shot at replacing Russian gas imports will fall well short of the target. In 2021, the EU imported ~155 billion cubic meters (bcm) of natural gas from Russia. Unfortunately, the bloc’s proposed gas replacements by the end of 2022--which include LNG (liquefied natural gas) diversification, renewables, heating efficiency, pipeline diversification, biomethane, solar rooftops and heat pumps--only amount to around 102 bcm annually, according to data from the EU Commission’s REPowerEU. (Source: Oil Price)
Putin’s Energy Weapon Is Backfiring (8 September 2022): By The Jamestown Foundation - The long-promised Ukrainian counteroffensive in the south has not yet delivered any breakthrough, but it still signifies a critical turning point for the war: Russia cannot hope to win by sticking to the pattern of trench warfare and artillery duels. Some “patriotic” commentators have suggested that the failures of Ukrainian attacks would pave the way for a new Russian offensive toward Mykolaiv and Odesa, but the Kremlin’s high command hardly entertains such strategic fantasies (Svobodnaya pressa, September 3). Russian summer offensive captured Sievierodonetsk and Lysychansk through such heavy expenditure of material resources and battalions that little capacity remains for a new push. In contrast, Ukrainian forces have relied more on well-targeted long-distance strikes and exploiting weak points in Russian forces’ porous defenses (Meduza, September 2). (Source: Oil Price)
An Iran Nuclear Deal Could Send Oil Prices To $65, But Is It Worth It? (7 September 2022): By Felicity Bradstock - After years of back and forth, with talks intensifying in recent months, a new Iran nuclear deal now appears to be a distinct possibility. While this could be great news for a world facing oil and gas shortages, some critics point to the geopolitical dangers associated with such a deal. Nevertheless, Iran has been preparing its oil industry for a swift recovery once an agreement is reached, following months of oil production increases. With oil prices rising exponentially this year, and several countries worldwide facing oil and gas shortages, the U.S. and other major powers are looking to ensure oil supply while shifting their reliance on Russia. This is one factor that has caused the U.S. to reconsider its stance on a new nuclear agreement, which would allow Iran to recommence largescale oil exports. (Source: Oil Price)
Saudi Arabia And Iran Held Secret Meetings To Bolster Collaboration (6 September 2022): By Simon Watkins - Given the centuries-long hatred between regional rivals, Iran and Saudi Arabia, last week’s comments by Iran’s President, Ebrahim Raisi, that there have been five rounds of meetings between high-level personnel from Tehran and Riyadh in recent months has drawn surprisingly little attention. This is all the more surprising, given that Raisi then cited Iraq – which apparently played the role of mediator between the two sides – as praising: “The initiatives offered, and measures taken by Iraq to improve cooperation among regional countries free from foreign meddling [will] play an effective role in bolstering regional collaboration.” In sum then, a rogue state, and the former number one ally of the U.S. in the Middle East, have been chatting away for months, hosted by a country which, following the U.S.’s ‘end of combat mission’ last year, appears to be drifting into civil war; so, what is going on precisely and where does it lead? As OilPrice.com has uniquely been highlighting for several months, Saudi Arabia’s days of being counted on by the U.S. as an ally are over. A key signal of this shift – over and above all the other signs since the end of the 2014-2016 Oil Price War, as analysed in depth in my latest book on the global oil markets – were comments about Iran made by Saudi Crown Prince, Mohammed bin Salman (MbS) last year. (Source: Oil Price)
Why Europe’s Dependence On U.S. LNG Is Risky (5 Aeptember 2022): By Alex Kimani - In the current year, the United States boasts status as the world's biggest liquefied natural gas (LNG) exporter as deliveries to both Europe–in the throes of a severe energy crisis–and Asia surge. So far in 2022, five developers have signed over 20 long-term deals to supply more than 30 million metric tons/year of LNG or roughly 4 Bcf/d, to energy-starved buyers in Europe and Asia. Europe’s desperate attempt to rid itself of Russian gas became even more urgent this week, as Moscow announced that flows through Nord Stream 1 to Germany would remain cut off until the West lifted sanctions. That desperation has resulted in Europe displacing Asia as the top destination for U.S. LNG. In fact, Europe now receives 65% of total U.S. LNG exports. But there are growing concerns that trading one dependency for another carries another kind of risk. Putting all your eggs in the U.S. LNG basket means banking on Mother Nature. U.S. LNG supplies might not be vulnerable to Russia, but they are vulnerable to extreme weather and harrowing hurricane seasons that disrupt output and exports. Europe cannot afford any more disruptions. (Source: Oil Price)
Nuclear Fusion’s Inclusion In The Inflation Act Is A Huge Win For Emerging Tech (1 September 2022): By Haley Zaremba - In August, President Joe Biden enacted the Inflation Reduction Act, which includes a wide array of provisions impacting varied topics such as Medicare, prescription drug prices, the Affordable Care Act, IRS funding, corporate tax law, electric vehicles, and renewable energies. So what doesn’t the Inflation Reduction Act do? Well, for one thing, it doesn’t lower inflation. According to a study by the Wharton School of the University of Pennsylvania, “The impact on inflation is statistically indistinguishable from zero.” In fact, the Inflation Reduction Act was not initially drafted as a response to rising inflation but is actually a slimmed-down version of the Build Back Better bill. This means that while the bill has no teeth in the inflation reduction department, it packs a serious wallop in terms of boosting the domestic renewable energy sector. Already, the photovoltaics company First Solar has announced that it will build its next solar panel manufacturing facility in the United States instead of overseas, citing the Inflation Reduction Act as the key motivation for doing so. The Arizona-based company will invest as much as $1 billion in the new facility and has said that it will also expand existing facilities in Ohio. (Source: Oil Price)