What’s Driving Oil Prices Up?

What’s-Driving-Oil-Prices-Up.jpgThere have been some big smiles in the oil world of late thanks to the recent surge in oil prices. The price of oil has fluctuated massively over the past decade but the current surge is promising for the industry, despite the US having just had its largest weekly rise of the year in crude inventories. Oil prices soared to a four year high. So, what exactly is the reason for this surge in oil prices. The answer is that there are a number of factors that are driving up oil prices.

 

One pressing issue is the supply fear that is sweeping the globe. The main reason for these fears stems from the US sanctions on Iran. Importing nations are unclear how the deficit will be made up. Indeed, other geopolitical uncertainties and unrests have caused panic in the market. In addition to Iran, the disturbances in Venezuela and various countries in the Middle East have also affected the market. With this uncertainty in mind, oil is being purchased in larger quantities to prevent any potential shortages in the future.

 

While the US sanctions on Iran are certainly a cause for concern, they alone are not responsible for the uptick in oil prices. Another main issue is simply the growing demand for the commodity. The population is growing and with it comes and increased need for energy. Countries are having to supply more and more energy for their citizens, which means importing increasingly large amounts. This higher demand looks set to continue growing in line with the global population and while there is a more concerted effort going into energy efficiency, it is not enough to reduce demand in any meaningful way.

 

Another issue is the uncertainty this winter will bring to countries around the world. The summer of 2018 saw record temperatures reached in a number of places around the world. There are fears that the winter will be as cold as the summer was hot and governments need to be prepared to supply more energy than usual to heat the homes of their people. Naturally, this means stockpiling oil now to make sure there is plenty to hand when the time comes. Particularly, this is important because when the weather is especially bad, importing oil can be a logistical challenge.

 

A further factor is the production cuts agreed between Russia and Saudi Arabia on behalf of OPEC. By slowing down the production of oil, this team of countries has brought supply and demand back into balance, despite the influx of oil from US fracking. Now, the glut of oil has been significantly diminished and the market is able to stabilise. The production cut is expected to continue until the end of 2018, by which time the over supply should be thoroughly resolved.

 

Finally, the economy is in a good place right now and when this happens the price of oil can rise accordingly. However, crude oil has now reached a point where it is so expensive it may start begin to slump soon as demand tapers off. But, at least for now, the price of oil is healthy, which is good news for exporting countries and bad news for motorists.

 

 

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Oil Production Expected to Skyrocket over Next Five Years Says Opec

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A report from Opec has shown that over the next five years the production of oil will soar to new records due to a drastic rise in demand from airlines. The increase in production is likely to offset the reductions expected from the arrival of electric cars.

The forecast comes as a disappointment to environmentalists who were counting on the advent of electric cars to help propel the world towards a completely clean future.

The increase in demand is coming primarily from China and India and the production will come from countries outside of Opec. Explosive growth in fracking in the United States is just one of the boom areas for production.

By 2040, Opec believes that the global oil demand will hit 112 million barrels per day, a huge increase from the current level of almost 100 million. The demand will be driven in large part by the transportation and petrochemicals sector.

Despite prominent figures and large swathes of the public voicing their concerns about the impact of burning coal on the environment, coal will continue to be burned in record amounts. While coal usage in OECD countries is predicted to go down by about a third by 2040, it is going to increase by about 20% in developing countries.

Meanwhile, airlines will become the fastest growing user of oil and will increase its consumption by about 2.2% year on year. The largest absolute growth will come from road transport.

The current number of vehicles on our roads is about 1.1 billion, but this number is expected to more than double to a whopping 2.4 billion by 2040. Opec estimates that only 320 million of these cars will be electric, unless battery-powered cars take off rapidly, in which case the number could reach 720 million.

However, even if the higher figure for electric cars is achieved, the demand for oil will only drop to 109 million barrels per day.

Projections in the report also showed a less promising future for renewable energy. The forecast showed that by 2040 renewable energy will only supply 20% of the global energy demand.

The Opec report evaded making any price predictions. However, motorists are unlikely to see fuel prices falling anytime soon as the International Energy Agency stated that there is a strong risk that oil prices will rise over the next few months.

Oil companies are anticipating peak oil demand to occur in the 2030s, but the possibility of it arriving in the 2020s has not been eliminated.

Opec has identified the US as a key player in production growth over the next decade and believes it will soak up most of the growth. The US’s tight oil production projection is strong and Opec admitted it will outperform the organisation. However, it believes that this production will peak in the second half of the 2020s, at which point Opec will be able to regain its stronghold. Ultimately, Opec hopes to increase its share of world oil supply from 34% to 40% by 2040.

Finally, the report was sceptical as to whether Trump’s pro-fossil fuel pushes will actually help the US oil industry. Particularly as production flourished under Obama’s far more onerous regulations.

 

Designing Taller Wind Turbine Towers

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Wind speed increases with height above ground. To reach the higher wind speeds in the low wind speed areas and meet the structural needs of the larger turbines with longer blades, the industry must design taller towers. According to a WindPACT study published in 2001, traditional towers taller than 65 m present serious logistics problems during transport and installation. With traditional tapered steel tower designs, the taller the tower, the larger the base diameter. The larger the base diameter, the more difficulties encountered, and expenses incurred during transport. One possible solution to the problem of transporting larger tower bases is to construct all or part of the tower on site using reinforced concrete. Using concrete rather than steel may also reduce material costs.

To evaluate design and construction approaches for economical hybrid steel and concrete wind turbine towers, efforts are continuously underway to research these questions and various construction techniques. Numerous private and public studies are being performed and continue to evaluate the design parameters and feasibility of ever-increasing the height of wind turbine towers.

The taller tapered steel towers also require large, expensive cranes for construction and some forms of maintenance and repair. The requirement for such cranes increases the cost of energy from the larger turbines. To eliminate the need for these cranes, NREL researchers are investigating several innovative tower concepts. They are negotiating a subcontract to Z-Tek, L.L.C., in Bakersfield, California, for the development of a prototype 100 m telescoping tower. A telescoping tower would eliminate the need for a large crane, thus reducing environmental impacts to the site as well as installation and maintenance time and costs. Telescoping towers would also allow developers to use hard-to-access sites located in rough terrain.

 

UN Chief Expresses Fears That Fossil Fuel Dependence Could Threaten Our Existence

UN-Chief-Expresses-Fears-That-Fossil-Fuel.jpgAntónio Guterres, the secretary-general of the UN, gave a speech at the UN headquarters in New York where he expressed his fears of runaway climate change. He emphasised the need for a global shift to clean energy in order to reduce the negative effects we are already seeing. His exact words were that the world is facing “a direct existential threat”.

He went on to condemn the lack of leadership the world is seeing and called on governments to take the crisis seriously. He said that the effects of climate change were very visible this summer just gone as extreme heatwaves, storms, floods, and wildfires devastated countries around the world. Examples of this include Kerala, which experienced the worst monsoon flooding on recent record; Puerto Rico, which was torn apart by Hurricane Maria and saw 3,000 people die; and wildfires in the US that were so big they caused ash to float around the world.

People are dying at the hands of extreme weather and our energy consumption is fuelling it. If we keep going at our current rate, who knows how many more hundreds of people will die as a direct result of climate change? Climate change is moving faster than we are and we need to put the brakes on it as soon as possible.

Oceans are becoming more acidic and the level of carbon dioxide in the air is rising. These pose a threat to food security for billions of individuals around the world. Despite scientists warning of this for decades, only now are governments paying real attention to the issue, but even that is not sufficient.

Guterres went on then to examine the Paris Agreement, which is a positive step forward but not nearly enough. According to a UN study, the commitment pledged by the 190 nation signatories represents about one third of what is actually needed to avoid the worst impacts of climate change. It is clear that there is still a very long way to go before any policies surface that will effect real change.

In one section of his speech, the secretary-general explained: ““We need to rapidly shift away from our dependence on fossil fuels,” he said. “We need to replace them with clean energy from water, wind and sun. We must halt deforestation, restore degraded forests and change the way we farm.”

He called on government leaders, scientists and businesses to stop idling and to take action immediately. If we do not change the way we behave by 2020 we risk wiping out the human race all together. If we are unable to move to green energy, the future is going to be incredibly bleak. Climate change is the greatest challenge we will have ever faced as a species and it require our fullest attention and resources.

Some may think Guterres is speaking in hyperbole when he says that the fate of humankind rests on the way we treat the problem of climate change. But, he is simply telling the truth, inconvenient as it might be. Technology needs to be developed and harnessed by the powers that be and some ground-breaking policies need to be put into action if we want any chance at all at saving our planet.

A wind energy dilemma

A-wind-energy-dilemma.jpgWind energy is booming. There is no denying the industry has seen a radical transformation in the last 20 years with rapid growth and major technological breakthroughs. With these breakthroughs, turbines are bigger in size and more efficient in generating electricity at smaller sizes too. All the while, costs have been coming down for installations and we are seeing the first subsidy-free projects being launched in various countries.

Wind is becoming a full-fledged market competitor in the electricity generation landscape. Most of today’s existing wind farms were built with subsidies and incentives such as power purchase agreements. As wind becomes more competitive and is able to stand its own ground, governments are faced with the question of what to do about renewable energy subsidies and incentives for wind projects. But not only that, generators are also looking at their existing fleet of turbines and are facing the question on whether or not to upgrade the technology (at significant cost) to achieve better gains, or to leave the existing (subsidized) technology in place.

Many of the first large-scale wind farms were built in the prime areas for wind energy generation. Technology deployed 10 or 20 years ago still has a decent life-span left, however, the technology that exists today is perhaps much more suitable to be deployed. With the wind energy sector maturing, we are starting to see a new phase of construction; the refurbishment phase, taking place along side the already strong growth.

Wind energy is certainly here to stay, and it is still only set to grow. On the manufacturing side, there have been numerous consolidation rounds that have already taken place, and the big names in manufacturing are well established. The sector is certainly one to watch for expansion, but as with any mature market, the frontier days are looking to come to an end.

Theresa May to Allocate over £100m to EV Tech

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It is becoming clearer every day just how important electric vehicles are. These clean alternatives to diesel and petrol cars are going to be pivotal in helping the world transition to a greener future. The tech is developing fast and it looks like the UK does not want to be left behind as the world surges forward.

With the EU clamping down on emissions and the UK consistently failing to do so, it is time for the country to seriously address the problem. There have been complaints that the government is not doing enough to tackle air pollution, which prematurely kills 1000 people every day. There are strong hopes that the deployment of electric vehicles around the world will act to solve this problem.

Theresa May, the UK’s Prime Minister, announced her pledge of £106 million in funding for electric vehicles. This will go towards research and development of the vehicles, batteries and refuelling technologies. The aim, according to May, is to make the UK one of the leading nations in the drive for mass produced, affordable electric vehicles.

Theresa May publicly announced the pledge on Tuesday at the Zero Emission Vehicle Summit in Birmingham – the first of its kind in the UK. She stated that she wanted the country to stand at the forefront of manufacturing these kinds of vehicles.

The Prime Minister is also going to host a round table to discuss the subject of automotive technology. Supply chain companies from Germany, Spain, India, China, Japan and the US will be present. The goal is to explore the possible options for industry and government to work together in the development of zero emission vehicles and to accelerate the growth of the market.

The Birmingham Declaration is a new international agreement that is due to be signed, initially, by 11 countries. Its aim is to forge the way for the mass production and sale of green vehicles and for the implementation of a smart infrastructure to support the new vehicles. Currently, the countries involved with the declaration include Denmark, Indonesia, Italy France, Belarus, the UAE, and Portugal.

Aside from the government’s actions, £500 million worth of investment is being poured in to low emission technology projects by industry majors. Not only will this drive the movement towards green vehicles, but it will also create over 1000 jobs in the UK.

It is clear that the UK has the potential to be a leader in the green revolution, but it will need international and industrial alliances to make it happen. Theresa May is giving the country an ambitious mission and if it succeeds the result will be spectacular. The goal is to make sure all new cars and vans are completely zero emission by 2040.

The government has also announced its offering of £2 million for electric delivery bikes. Furthermore, it hopes to be able to provide ultra-low and zero emission cars, vans and taxis, with green number plates. This is hoped to be an effective way of promoting electric vehicles.

Exciting new sources of bio-energy

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Bio-energy has been around for many thousands of years. Think of the burning of wood for heat and cooking stretching back to the earliest of human existence. Today, biofuels have become far more advanced, and their uses aren’t just limited to cooking. Many companies and research institutes are working hard to develop the fuels and technology that we can use in the future to help curb our use of fossil fuels and replace them with a more sustainable source of energy.

Though in many cases there is combustion with biofuels, and gasses are released into the atmosphere, the production of the fuels is able to directly absorb and recapture the expelled gasses and components, making bio-fuels an excellent source of renewable energy. Pollution problems may still exist locally, but in balance, with the use of biofuels there should be no surplus or additional greenhouse gasses being released into the atmosphere that cannot be re-captured and absorbed quickly.

Bio-Ethanol production and commercialization is one of the prime focuses and research areas for many industry players. Researchers are also addressing the issue of food versus fuel production by looking at ways to combine the production streams and using waste and residue products for fuel production while maintaining food and feedstock production.

One area of research that seems to have slowed down despite promising prospects is that of algae fuels, however, development continues and much of the research already performed is being elaborated on and applied for uses such as the production of jet fuel and biodiesels.