In what’s one of the most baffling energy policy decisions of 2022, Germany sticks to closing its 3 remaining nuclear power stations in December.
BUT then it U-turns itself, keeping 2 of them in reserve until April 2023 for emergencies. But are we not already in an emergency?
“This way, we can act if worst comes to worst,” German Economy Minister Robert Habeck said Monday in an emailed statement, adding that the government remains “committed to the nuclear exit.”
And just as a note: coal-fired power stations generated roughly 30% of the electricity produced in Germany in the first half of 2022, ahead of every other source
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OPEC+ agreed to a tiny oil output hike of 100,000 b/d for Sept, sending Brent back above $100 a barrel.
The increase (the 2nd smallest hike in the cartel's history, only behind one in 1986) comes despite President Biden's trip to Saudi Arabia | #OOTT 1/4 bloomberg.com/news/articles/…
The OPEC+ 100,000 b/d output hike compares to an expectation in Washington only a few days ago that Saudi Arabia would lead the cartel to boost production by 400,000-500,000 b/d. For weeks, US officials have said they expected positive steps at the Aug 3 OPEC+ meeting | #OOTT 2/4
The OPEC+ increase isn't real, either, as most member are already pumping at their maximum capacity. Only Saudi Arabia and the UAE can increase. If they adhere to their quotas, the 100,000 b/d translates in an extra 26,000 b/d for Riyadh and 8,000 b/d for Abu Dhabi | #OOTT 3/4
EU energy ministers are meeting today in Brussels to try to find an agreement to reduce natural gas demand ahead of winter. The European Commission proposed a voluntary 15% cut across all members - but many countries have rejected the plan | 1/5 #EnergyCrisis
he Czech Republic, which holds the EU’s rotating presidency, has proposed 3 changes to the original proposal to win support from the likes of Spain, Italy and Poland. The tweaks water down (a lot) the original proposal, but probably are acceptable to everyone | 2/5 #EnergyCrisis
On the table also, a **very interesting** Greek proposal to create a new pan-European financial mechanism (with EU and national funding) for national reverse auctions to encourage companies to reduce gas and electricity demand (they get paid to consume less) | 3/5 #EnergyCrisis
BIDEN IN SAUDI 1/6: US President Joe Biden lands in Jeddah later this afternoon for a two-day visit. Based on conversations with officials, I do NOT expect that Saudi Arabia (or the US) will announce an oil output increase during the July 15-16 visit | #OOTT
BIDEN IN SAUDI 2/6: The July and Aug output from the kingdom is already decided. KSA is still mulling its options for next OPEC+ meeting (Aug 3). *If* Riyadh pushes ahead with an output increase for Sep, it would be as part of an OPEC+ deal, rather than unilateral action | #OOTT
BIDEN IN SAUDI 3/6: The US believes Saudi Arabia (and the UAE) can increase oil production further without reducing spare capacity to precarious levels. It's clear that Washington hopes the Biden's visit will translate into a production hike by the Aug 3 OPEC+ meeting | #OOTT
G7 rewrites its own history, weakening its pledge to end "direct public support for the international unabated fossil fuel energy sector by the end of 2022" adding now an exit clause: "except in limited circumstances"
On the Russian oil price cap, the G7 leaders agree to further talks, but (as I flagged), does NOT reach a deal:
"We task our relevant Ministers to continue to discuss these measures urgently, consulting with third countries and key stakeholders in the private sector"
BREAKING: Global oil demand growth will **accelerate** to 2.2m b/d in 2023, up from 1.8m b/d in 2022, the @IEA said on its first look into next year's S/D balances.
"Global oil supply may struggle to keep pace with demand next year," the IEA said | #OOTT#ButTheRecession
As as last month, the @IEA report is full of dire warnings. Global energy policymakers can not say they weren't warned: the second half of 2022, and the full of 2023 look very, very difficult. The IEA doesn't send this warnings that often - pay attention | #OOTT
And ICYMI, this is my @opinion from Monday, warning that the 2022 oil shock was going to roll over into 2023 (as the IEA confirmed today) | #OOTTbloomberg.com/opinion/articl…
As the economic cost of the war mount, the cracks are emerging.
Today’s NYT editorial board:
“… in the end, it is still not in America’s best interest to plunge into an all-out war with Russia, even if a negotiated peace may require Ukraine to make some hard decisions…”
And this from the same editorial:
“… but popular support for a war far from U.S. shores will not continue indefinitely. Inflation is a much bigger issue for American voters than Ukraine, and the disruptions to global food and energy markets are likely to intensify…”
The full editorial comment is here, in effect making the case for peace talks in which Ukraine gives up some of the territory that Moscow has conquered since 2014 nytimes.com/2022/05/19/opi…