When you ask energy experts what headlines to watch for in President Obama’s second term, you’re likely to hear about issues that are hot right now: the possibility of new greenhouse gas regulations, growth of U.S. oil and gas, prospects for wind energy and distributed solar, LNG exports, and the like. All of these will almost certainly be in the news. But I’ll hazard another guess: odds are high that many of the biggest headlines and decisions will be about things that we aren’t even thinking about today. Read more »

West Texas Intermediate (WTI) and Brent have been locked in a multi-year wrestling match for the exalted status of the definitive world benchmark price of oil. WTI’s glaring deficiencies as a barometer of supply-demand fundamentals in the global crude market, owing to an oversupply of oil at its land-locked pricing hub of Cushing, Oklahoma, have been plain for several years now. But a close look at recent futures trading volumes shows that Brent has steadily surpassed its rival as traders’ preferred way to gain exposure to oil, marking an important moment in the North Sea benchmark’s arrival as the “real” price of oil, at least for now. Read more »

President Obama surprised pretty much everyone when he spent a considerable part of his inaugural address talking about the need to confront climate change. It suggests a willingness to tackle the issue in ways that go beyond what was accomplished in his first term. Read more »

The failure of ailing Venezuelan president Hugo Chavez to return from Cuba, where he is recovering from another round of surgery, to Caracas for his inauguration underscores the uncertainty of the South American country’s future as a critical oil supplier. Chavez, first elected in 1998 and inaugurated in 1999, rode ultra-low oil prices to power, promising a tougher stance against the majors and a more hawkish voice within OPEC. So how’s the country’s oil industry faring today versus when he entered office? Read more »

Constant chatter about an impending oil release from the U.S. Strategic Petroleum Reserve (SPR) was a prominent feature of the oil market last year. Much of the speculation was driven by the ongoing loss of crude from Iran, due to sanctions, and the possibility of a confrontation with Tehran over its nuclear program, which could have cut off traffic through the vital Strait of Hormuz. Read more »

There’s a lot of buzz today about new projections for U.S. oil imports showing that imports are poised to continue diving. The Financial Times captures the essence well with the headline “U.S. oil imports to fall to 25-year low”, referring to projections through 2014. I’ve written before about the risks of focusing on imports rather than consumption. If you want to focus on imports, though, the number to drill down on isn’t the volume of imports – it’s spending on imports as a fraction of GDP. Alas, by that measure, despite a positive trend and strong improvements over the last decade, the United States will remain in worse shape next year than in any year between 1983 and 2003. Read more »

One interesting feature of the U.S. hydrocarbon boom is the widening gap between the industry’s interest in drilling for oil and other liquids versus dry natural gas. It’s all about economics: the disparity in prevailing market prices and outlook between these commodities is dictating companies’ willingness to sink money into, and bear the risk of, trying to produce them. Read more »

I have a new paper (PDF) in Climatic Change that explores the climate consequences of natural gas as a bridge fuel. [Update: The article is now behind a paywall. If you don't have access, you can download an unformatted pre-print version here.] Read more »

People looking for a way that natural gas could break oil’s stranglehold on the U.S. transport system typically run into forbidding limits. Gas could be used to run power plants that would charge electric cars, but those cars are currently too expensive for most drivers. Gas could be compressed and used directly in automobiles, but limited range and fueling infrastructure are big barriers. Natural gas could also be converted into gasoline or diesel, but the costs and risks of building plants can scare investors. Read more »