AES expert members, including Daniel Yergin, believe that $50/barrel is here to stay.
- One reason oil climbed to $50/barrel is because a group of privately owned Chinese refineries— dubbed “teapots” because they're small compared with state-owned companies—have been granted unprecedented authority by the Chinese government to make private and direct purchases of crude oil on the open market. Their activities are driving the global market, and oil tankers line up sometimes for weeks to deliver the crude oil. Teapots now account for 15% of China's crude imports.
- Another reason why oil prices have climbed to the $50/barrel range - the "Niger Delta Avengers" have blown up a series of Chevron wells, a Shell terminal, and sections of the AGIP pipeline operated by Eni, the Italian oil company, reducing the global supply by more than one million barrels/day.
- The LNG export market is becoming highly competitive. In two or three years, new pipelines currently under construction will become operational in Azerbaijan, Russia, China, Iran, Turkey, Pakistan, Afghanistan and India.
- FERC has approved the Kinder Morgan LNG export terminal project on Elba Island near Savannah, Georgia. This is the first of 10 liquefaction units to be built by Kinder Morgan; the units will be operational in the second quarter of 2018.
- Top publicly financed international coal projects (by nation; $42 billion total investments in 2015)
1. Japan: $22 billion (or 52 percent of the total)
2. Germany: $9 billion
3. United States: $4 billion
4. France: $3 billion
Note: In 2015, the G7 agreed to begin phasing out domestic coal.
- The US coal industry employs about 90,000 miners, of which 12,000 are in West Virginia.
- The Tennessee Valley Authority (TVA) has submitted an application to the US Nuclear Regulatory Commission to build a small modular nuclear reactor (SMR) - more evidence that smaller and cheaper nuclear units are on the rise.
Courtesty of The American Energy Society and Eric Vettel.