Oil depletion Newsletter

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Oil depletion Newsletter

ODAC - The Oil Depletion Analysis Centre
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ODAC Newsletter - 27 February 2009

Welcome to the ODAC Newsletter, a weekly roundup from the Oil Depletion
Analysis Centre, the UK registered charity dedicated to raising
awareness of peak oil.

Oil prices
rallied this week on the back of the US stimulus package, a surprise
increase in US gasoline demand – up 1.7% year on year despite the
recession – and the potential for further OPEC cuts. Downward pressure
began again on Friday as investor attention returned to weak economic

The latest economic data confirmed the extent to which even mighty China is being affected by the downturn: energy demand growth
in the People’s Republic has slowed from 9.6% in 2006 to just 4% last
year – the lowest growth since 2003. Yet China’s influence on the
global energy supply continues to increase as it exploits its vast
foreign currency reserves to corner future supply.

The UK’s energy security and climate change policy was under the
microscope again this week, as a report from Ernst & Young
concluded that Britain will need to double investment in energy
infrastructure to meet emissions and renewables targets, and replace
ageing infrastructure. Meanwhile the debate about what forms of
generation will be needed to achieve those emissions cuts took an
unexpected turn when four leading green thinkers came out in favour of nuclear power.

One highlight this week was an excellent documentary on peak oil and agriculture, part of the BBC’s Natural World series called A Farm for the Future. For UK based readers the programme is still available to view on iPlayer, or you can read Chris Vernon’s review of the programme on theoildrum.com. Natural World isn’t prime time TV, but it is a start.

us! Become a member of the ODAC Newsgathering Network. Can you
regularly commit to checking a news source for stories related to peak
oil, energy depletion, their implications and responses to the issues?
If you are checking either a daily or weekly news source and would have
time to add articles to our database, please contact us for more details.


Damnthematrix's picture
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Posts: 3998
Re: Oil depletion Newsletter
from ASPO-USA's PO News, 28 Feb 2009 
Fri, Feb 27 2009, 16:34 GMT
NEW YORK (Dow Jones)--Amid record-high oil prices and a weakening economy, U.S. oil demand fell in
2008 by 6%, or 1.26 million barrels a day, to a 10-year low of 19.419 million barrels a day, the latest
government data show. 
The drop reported by the Energy Information Administration on Friday was the largest decline since 1980,
when prices surged and demand fell after the Iranian Revolution. 
The 2008 drop follows a fractional 7,000-barrels-a-day dip in 2007 and a 0.6%, or 115,000-barrels-a-day,
decline in 2006. The drop in the past three years is the longest stretch of annual declines since 1981-
1983, which was part of a five-year slide begun in 1979. 
In December, use averaged 19.199 million barrels a day, a drop of 1.52 million barrels a day, or 7.4%,
from a year earlier, revised data for the month show. 
Preliminary data showed December demand down just 3.5%, or 726,000 barrels a day. 
Demand for gasoline, the most widely used petroleum product, fell 3.6%, or 330,000 barrels a day, in
December from a year earlier, despite prices that were 44% below a year earlier. Demand was the
weakest in December since 2002. Preliminary data has shown a decline of 2.4%, or 218,000 barrels a
day, from a year earlier. 
Full-year gasoline demand averaged 8.964 million barrels a day, the lowest since 2003, and down 3.5%,
or 322,000 barrels a day from a year earlier. 
U.S. retail regular gasoline averaged a record price of $3.246 a gallon in 2008, up 16% from a year
earlier, EIA data show. In December, gasoline was 44% below a year earlier at an average retail price of
$1.687 a gallon. 
Demand for distillate fuel, the umbrella grouping for diesel fuel and heating oil, dropped 9.8%, or 409,000
barrels a day, in December to an eight-year low of 3.784 million barrels a day. 
 That's a steep downward revision of 8.4%, or 349,000 barrels a day, from the preliminary data, which
suggested a slim drop of just 60,000 barrels a day from a year earlier. 
Demand for ultra-low sulfur diesel fuel, required for use in trucks, fell 5.3% from a year earlier to 3.022
million barrels a day, the lowest level in any month since May 2007. Ultra-low sulfur distillate demand
lagged year-earlier levels in three of past four months, reflecting weakness in U.S. economic activity. 
For all of 2008, distillate use was down 6.1%, to a five-year low of 3.938 million barrels a day, while within
that figure, demand for of ultra-low sulfur diesel rose 8.7%, to 3.206 million barrels a day. 
Diesel fuel sold for a record average of $3.803 a gallon in 2008, up 31.8% from a year earlier. In
December, retail diesel averaged $2.449 a gallon, down 26.7% from a year earlier. 
Demand for jet fuel fell 13% in December, or 209,000 barrels a day, to 1.394 million barrels a day, the
lowest in any month since November 1993, and the weakest in December since 1991. 
Full-year jet fuel demand was the lowest since 1995, at 1.518 million barrels a day. The 6.4% drop in the
year was the biggest since 1974 and was the third straight drop. 
Demand for heavy, residual fuel oil, used by utilities and heavy industry, rose 13.2% in December from a
year earlier, to 753,000 barrels a day. Resid demand was the strongest in any month since November
2007 and at a three-year high for December. 
But for all of 2008, residual fuel demand was the lowest on record, at 620,000 barrels a day, a drop of
from a year earlier. Residual fuel faces heavy price competition from natural gas, and EIA data
show wellhead natural gas prices rose an average of 27% in 2008, a smaller rise relative to oil. 
Refiners paid a record average of $94.48 a barrel for crude oil supplies in 2008, up 39% from a year
earlier. In December, the refiner cost of crude was $39.82 a barrel, down 53.3% from a year earlier. 
Front-month U.S. benchmark crude oil futures prices on the New York Mercantile Exchange averaged a
record $99.75 a barrel in 2008, up 37.8% on the year after hitting an intraday high of $147.27 in July. In
December, prices averaged $42.04 a barrel, down 54.2% from a year earlier. 
The EIA said in its Feb. 10 Short-Term Energy Outlook it expects U.S. oil demand to drop further this
year, to average 19.02 million barrels a day, before rising 1.2% in 2010, to 19.24 million barrels a day. 
Damnthematrix's picture
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 3998
Re: Oil depletion Newsletter
from ASPO-USA's PO News
Wire reports
Upstream Online
Friday, 27 February, 2009, 18:34 GMT  |
The International Energy Agency fears that an expected recovery in oil demand from 2010 and oil project
cancellations due to low crude prices and the credit crisis will mean no spare oil capacity at the end of
"That is our concern. Investment, investment, investment, that is what we are asking," IEA Executive
Director Nabuo Tanaka said at a conference in Lisbon on Friday. 
The Paris-based IEA, which advises 28 industrialised countries, earlier this month said global oil demand
would drop by 980,000 barrels per day this year but would rise again by about 1 million bpd in 2010 with
an expected economic recovery. 
Tanaka said in a Reuters report that there was no room for complacency on spare oil capacity. 
 "We now see many cancellations or postponements of supply investment projects...and we learned the
lesson last year when we didn't invest, the market became volatile and oil prices reached $147 per
barrel," he said. 
He added that supply from producing oil fields will decline dramatically, and that to offset the decline by
2030 "we need 45 million barrels per day of new capacity, or the equivalent of 4 Saudi Arabias". 
Regarding current oil prices, Tanaka urged Opec not to seek rapid rises in oil prices by cutting supply. 

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