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Showing posts from October 10, 2021

Why do US crude inventoreis rise, when oil prices soar?

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  Defying logic, the US crude inventories rose for the third successive week, according to the data released by the EIA, US Energy Information Administration and the API, American Petroleum Institute. The API said on Tuesday that the US crude inventories rose by staggering 5.21 million barrels; the EIA put its figure at 5.3 million barrels, a day later on Wednesday. The inventory build-up, by a significant margin, left analysts scratching their heads searching for answers, as the expectations were quite the opposite. In fact, API’s own estimate for the week ending October 10 was 0.14 million barrels. The news indicating surprise increase in the US crude inventories comes at a time when the traffic is on the roads and aeroplanes are in the air, as if things were as if the world was in the pre-pandemic times. Since it happened at a time when the demand for commodity got a massive boost due to the global crunch in the gas markets, the development adds yet another piece to the crud

The EIA predicts higher fuel bills for US consumers this winter: the energy crunch shows no sign of abating

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There is no sign of let-up in the global energy crunch as of this week, as the chaos in supply chains grows unabated alarmingly. Long standing, sometimes running centuries back, political rivalries hardly help alleviate a catalogue of crises stemmed from the same problem that needs collective global action. The bone of contention between France and Britain over a range of issues, not just one, is a case in point; the French even threatened to cut off the electricity supply to the latter from the former at the heat of the argument. In addition, the diplomatic tussles between the West and Russia do not help get more gas into Europe at its hour of need either. Analysts argue that the European nations were too complacent about the potential contribution to the respective power grids by the renewables, especially wind. Much to their dismay, however, there were unusually long static periods in the atmosphere above the regions, where there are heavy concentration of wind turbines. Des

Floods in Chinese Coal-mining regions: doule whammy is not just for China!

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  China’s energy crisis was dealt a new blow on Monday as two key regions in the north, Shanxi and Shaanxi provinces, experienced heavy floods. The Chinese government, according to media reports, allocated over $12 million for those who had been affected by the disaster. In addition, some major businesses in China make their own contributions to alleviate the suffering of the people in the regions. The flood situation in Shaanxi province has, meanwhile, become a focus for global attention: it is not just the damage to an area over 190,000 hectares of farmland with crops – and over 17,000 houses – that bore the brunt of nature’s fury; on the contrary, it is the significance of this particular province in producing coal that is in unprecedented demand at present, not just in China, but across the world. The Chinese authorities have shut down 60 coal mines in the region due to the floods. A few days ago, China ordered energy firms to go on a buying spree to get enough coal for t

Global energy crisis: no magic bullet in the offing

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  The price of crude oil reached record high on Monday as the worries over the supply of fuel for the winter months in Europe and America are growing by the day. At present, the Western policymakers do not know what to do in order to alleviate the crisis: gas has been in short supply for weeks and that in turn has increased the demand for oil and coal. Coal mining firms did not increase the investments in the past few years as the industry, more often than not, has been singled out for causing the biggest environment damage; in these circumstances, they cannot increase production at short notice. It may not be fashionable yet; the demand for coal, however, is on the increase, in Europe, China and of course, elsewhere. The power shortages in China, meanwhile, are on decline as the authorities were ready to finance the imports, if necessary. It, however, has taken its toll on multiple production lines that could potentially lead to supply chain disruptions.   The Western leader

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