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The headlines are scary: natural gas price in the UK quadruples in 2021, Russians accused of manipulating natural gas supply, gas price hikes force closure of fertilizer plants, leading to a shortage of carbon dioxide needed to stun animals before slaughter, which could lead to a meat shortage. On top of that, fire closes the main electric transmission line to the Continent, and the government is in a dither about what to do. But there is another story, a financial one, that we want to focus on. The UK’s energy suppliers, the firms that buy…
The oil industry is in a terminal decline, hedge fund manager James Jampel told Bloomberg on Friday, noting that this year’s rise in oil stocks has been “the biggest dead-cat bounce in history.” Jampel, who manages the HITE Carbon Offset hedge fund that aims to profit from decarbonization by “shorting decarbonization losers”, is extremely bearish on oil, despite the 33-percent rise of the S&P’s energy index this year. The oil industry will be the loser of the energy transition, says Jampel, whose $187-million…
Despite huge oil reserves waiting to be tapped, the ongoing sanctions on Venezuelan oil and the current state of politics and the economy are driving international oil majors away from the Venezuelan energy market. International companies are starting to give up on Venezuela, which has the world’s largest proven oil reserves standing at 304 billion barrels, as U.S. sanctions and the political state of the country present too much risk to ongoing investment.  This summer, both TotalEnergies and Equinor divested their interests in Venezuelan…
The energy transition is in full swing, with electric vehicles supplanting gas guzzlers and solar panels and wind turbines replacing coal and oil as the world’s leading energy sources. The energy transition is driving the next commodity supercycle, with immense prospects for metals producers, technology manufacturers, and energy traders and investors. Indeed, new energy research provider BloombergNEF estimates that the global transition will require ~$173 trillion in energy supply and infrastructure investment over the next three decades,…
Default fears have continued to stalk the China Evergrande Group (OTCPK:EGRNF) (OTCPK:EGRNY) despite efforts by its chairman to lift confidence in the embattled firm. The Evergrande Group, one of China's biggest real-estate developers, owes $305 billion to a number of lenders, with its interest liabilities rising by an average of $28 million daily.  A major test for Evergrande comes this week, with the firm due to pay $83.5 million in interest to bondholders relating to its March 2022 bond on Thursday, and another $47.5 million payment due…
Since the controversial 1899 decision which set the border between Venezuela and Guyana, Caracas has repeatedly contested the ruling, claiming the 61,000 square miles west of the Essequibo river belongs to the Bolivarian Republic.That controversy has heated up in recent years with authoritarian Venezuelan President Nicolas Maduro reinvigorating the claim as a means of distracting Venezuela’s long-suffering people from the country’s economic collapse and near implosion into a failed state.In a surprising development at the Norway brokered…
A cross-section of Wall Street experts has been downplaying the recent surge in oil prices, saying that it’s unlikely to hurt the global recovery. One indicator that lends credence to this claim is the oil load, or the cost of oil as a proportion of gross domestic product. According to Morgan Stanley, the oil load--which is an indicator of the impact of oil on growth--is expected to reach 2.8% of global GDP in 2021, significantly lower than the long-term average of 3.2%, assuming an average oil price of $ 75 per barrel this year. But that…
The global pipeline for green hydrogen projects is growing fast, with a current target of 206 gigawatts (GW) in installed electrolyzer capacity by 2040. However, a Rystad Energy analysis reveals that the locations of the planned projects are overwhelmingly in areas where water is in short supply. This means that an additional desalination market needs to be created to produce most of the 620 million cubic meters of water that these projects will need. Research and development is under way to add and improve the built-in desalination capability…
Despite promises of improved infrastructure and better disaster preparedness, governments and energy giants are failing to provide backup energy provisions to areas hit hard by extreme weather conditions again and again. As these events are becoming more frequent and stronger, how will the energy industry prepare for the future of energy provision? The ongoing discussion over energy infrastructure resilience which is brought up year after year peaked in February in the U.S. as Texas battled against a severe winter storm that saw the electrical…
China is estimated to have sent around 760,000 barrels per day (bpd) of crude oil to its strategic and commercial reserves in August, as refinery throughput in the world’s top oil importer slumped to the lowest in 15 months. Last month, China reversed four months of estimated draws from its inventories, mostly as a result of the low refinery volumes, according to estimates of Reuters columnist Clyde Russell based on official Chinese data. Refinery runs in China fell to 13.74 million bpd in August – the lowest in 15 months, on the back…
The largest bank in Africa by market capitalization, FirstRand Limited, will no longer finance new coal-fired power plants, the lender said on Wednesday in its updated energy and fossil fuel policy. From 2026 onwards, South Africa-based FirstRand will no longer provide direct project finance to new coal mines either, the bank said, as investor and societal pressure grows on the banking sector everywhere to rethink financing for fossil fuels.   FirstRand also pledged in its new climate policy to reduce the cap on its coal exposure further—from…
The COVID pandemic has wreaked considerable damage on the economies of South America’s smaller fiscally fragile countries, with the former Dutch colony of Suriname hit especially hard. During 2020 the impoverished South American nation’s gross domestic product shrank by 13.5%, the continent’s worst performance after Venezuela. A deeply impoverished Suriname now finds itself mired in a severe economic crisis that is threatening an already fragile state that only emerged from an intense political impasse during July 2020.The depth…
Natural gas prices have hit their highest levels since 2014, outpacing oil and many other commodities. On Monday, natural gas futures were trading up 2.6% to $5.09 per million British thermal units (BTUs), their highest settlement price since February 2014. Natural gas prices are up 117.6% in the year-to-date, while the biggest nat. gas benchmark, the United States Natural Gas ETF, LP (NYSEARCA:UNG) is up 88.6% over the timeframe. The sticker shock is even greater in other key natural gas markets around the globe, with East Asian benchmark futures…
After commencing exploration drilling in offshore Guyana in 2015 the world’s second largest publicly listed oil company by market cap ExxonMobil experienced stunning success. In little more than six years Exxon has made 22 high-quality oil discoveries in the 6.6-million-acre Stabroek Block, the latest being at the 5,938 feet Pinktail well, located nearly 22 miles to the southeast of the Liza phase 1 development. Hess, Exxon’s partner, with a 30% interest in the Stabroek Block announced the successful appraisal of the Turbot oil discovery…
As the latest strong storm that passed through the U.S. Gulf of Mexico showed, hurricanes are testing the resilience of offshore oil and gas facilities and pipelines.   Hurricane Ida made headlines as it left 1 million customers in the state of Louisiana without power and shut-in as much as 95 percent of the U.S. Gulf of Mexico's oil production just before making landfall in Louisiana on August 29. Unfortunately, the continued disruption to oil and gas production in the Gulf of Mexico was not the only headline-grabbing consequence of…
U.S. West Texas Intermediate crude oil futures are trading higher on Friday, clawing back some of this week’s losses in the process. The catalysts behind the early strength are growing concerns over supply tightness in the United States in the wake of the damage from Hurricane Ida and as the possibility of improving U.S.-China trade relations bolstered demand for riskier assets. China to Release Oil from its Strategic Reserve Worries over tight supply balances and the Gulf’s offshore oil production are offsetting bearish news from China…
In a little over a decade Latin America’s largest economy Brazil has become a leading global oil producer. At the end of 2020, Brazil was not only pumping the most oil in Latin America, an average of 3.03 million barrels daily, but finished ranked as the world’s seventh largest producer behind OPEC member Iraq and ahead of the United Arab Emirates. According to Brazil’s Mines and Energy Minister Bento Albuquerque, Latin America’s top oil producer will become the world’s fifth-largest petroleum exporter by the end of…
As Europe looks to lead the world in electric vehicle (EV) uptake, many governments are incentivizing the switch from traditionally-fuelled cars to electric alternatives, hoping to end the sale of petrol and diesel vehicles and get on the path to net-zero carbon emissions over the next decade.  As major automotive manufacturers catch up with niche EV brands such as Tesla, Europe is ready to build up its EV market through incentives such as subsidies, free electric charging options, tax breaks, and a wide variety of EV options for consumers.…
The Abu Dhabi National Oil Co (ADNOC) is the key corporate proxy at the centre of the U.S.’s Middle East pushback against increasing Chinese and Russian influence across the region via their activities in Iran (and Iraq). The awarding of exploration, development, and ancillary contracts for its onshore and offshore oil and gas fields is a principal mechanism by which ADNOC is used to promote engagement with countries regarded as ‘in play’ by Washington. A longstanding prime example of this is Pakistan and the awarding last week…
The oil-dependent South American country Ecuador, which left OPEC in January 2020 to avoid production quotas, has embarked on an ambitious plan to double its oil output. The tiny Andean nation with a population of nearly 18 million has struggled for years to grow its hydrocarbon sector as a means of bolstering a fragile economy that has been hit hard by the COVID-19 pandemic with its 2020 gross domestic product shrinking 7.5%. For decades, Ecuador has struggled to boost oil production with heavy-handed regulation, frequent environmental catastrophes,…
Americans are paying the most expensive Labor Day weekend gasoline prices since 2014 amid constrained stock levels and high benchmark crude oil prices.  The end of the U.S. driving season comes just a few days after OPEC+ ignored the Biden Administration's call for higher-than-planned increases in the alliance's oil production in order to ease high gasoline prices and continue supporting the economic recovery.  "President Biden has made clear that he wants Americans to have access to affordable and reliable energy, including at the pump,"…
Future electricity systems must be made more resilientProlonged blackouts in Louisiana following Hurricane Ida are a reminder the power grid needs to become more resilient as well as reliable if even more services such as electric vehicles are going to depend on it in the future. The electricity system is already directly responsible for providing a wide range of energy services in homes, offices, and factories, including space heating, air-conditioning, cooking, refrigeration, and power. The grid is also at the heart of a collection of other critical…
Nigeria has failed to adequately implement and deliver thousands of projects—funded with $14 billion—to help the social, economic, and infrastructure development of the oil-rich but impoverished Niger Delta region, Nigeria’s Attorney General Abubakar Malami has said. Between 2001 and 2019, the government agency Niger Delta Development Commission (NDDC) was tasked to implement projects that would “offer a lasting solution to the socio-economic difficulties of the Niger Delta Region and to facilitate the rapid and sustainable…
When Brazil’s Mines and Energy Minister appeared on TV earlier this week to plead with citizens to reduce their energy consumption due to a drought-induced hydropower crisis, he was not alone. Brazil is just one of many energy-producing countries facing drought and other extreme weather conditions that are making hydropower production that much harder.  In his appearance on Brazilian TV, Bento Albuquerque warned that Brazil is heading into a worse energy crisis than initially anticipated due to yet another record drought. As well as…

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