Monday, March 07, 2022

World faces 'energy starvation' as oil and gas prices soar even higher

"Across the world" is misleading. Australia is an exception. Australia has an abundance of coal and gas and exports much of it. Canada is in a similar position. So supply of both commodities to Canadian and Australian householders is likely to remain little affected by international shortages.

Households across the world are facing “energy starvation”, analysts have warned, as gas prices hit a fresh record and oil surged an 11-year high.

Experts warned prices at the petrol pump would push fresh records after Brent crude oil jumped as much as 8pc to $113 a barrel. In New York, WTI crude rose 8.8pc to the highest since 2011.

European gas prices rose 55pc to an all-time high of €194 per megawatt hour as the conflict in Ukraine rocks global energy markets. In the UK, next-day gas futures soared as much as 60pc to 464p per therm, nearly beating the record highs touched in December.

Thermal coal prices topped $350 a tonne to record highs amid fears supply from Russia will be stifled.

Bjarne Schieldrop, commodities analyst at SEB, said: “The global economy is facing energy starvation right now. Fossil fuel prices can go even higher in the short-term but demand destruction will set a limit to the upside eventually.”

The United States and other world powers on Tuesday announced plans to release 60m barrels of oil from their strategic reserves in an effort to combat soaring fuel prices.

Damien Courvalin, head of energy research at Goldman Sachs, said the release would not provide “sufficient relief”, being only enough to offset a single month of potential disruption.

Opec and its allies – of which Russia is the second-biggest member – agreed to a modest supply increase of 400,000 barrels a day, a negligible increase as the conflict in Ukraine upends global energy markets. The cartel said recent price increases had been driven by geopolitics, rather than market fundamentals.

Edward Gardner, a commodities analyst at Capital Economics, said Russian oil exports were likely to drop as sanctions bite.

“Foreign buyers of Russian oil have already reported problems accessing the required finance to make their purchases,” he said.

Germany is prepared for the worst if Russia stops exporting gas to Europe and could keep coal-fired power plants running, according to its economy minister.

Robert Habeck sought to calm concerns about the potential disruption of energy supplies to Europe's largest economy amid Russia's war in a radio interview on Wednesday.

Germany gets about half of its gas from Russia, some from pipelines through Ukraine. Supplies to Europe continue to flow despite the conflict but there remains the threat of sanctions, damage to pipelines or retaliation from the Kremlin.

Europe also gets gas in shipments from countries including Qatar and Australia, but there is global competition for these supplies and Germany itself does not have any liquified natural gas (LNG) import terminals.

Asked what Berlin would do if Russia stops exporting gas, Mr Habeck said: “We are prepared for that. I can give the all-clear for the current winter and summer.”

In a worse-case scenario Mr Habeck said Berlin could keep “coal-fired power plants in reserve, maybe even keep them running”, but that it remained committed to moving to renewables in the medium-term.

The impact of surging energy prices was visible in new eurozone inflation figures, which showed consumer prices rose 5.8pc in the year to February. Core prices, with energy and food stripped out, rose 2.7pc in a sign price increases are broad-based.

The increase was well above the 5.4pc rise anticipated by economics. Salomon Fielder, an economist at Berenberg, said: “Firms are passing higher input costs on to consumers”.


Greta Thunberg enabled Vladimir Putin

Once the Russians have flattened and occupied Kiev, Lviv, Kharkiv, etc., as surely they will (for anything less would be a defeat), the question will be asked in the West, “Who lost Ukraine?”—as once the question, “Who lost China?” was asked. My preferred answer would be Greta Thunberg—or perhaps I should say, to be a little fairer, Greta Thunberg and people like her.

The Thunberg episode must have been of great aid and comfort to the man in the Kremlin, for it must have convinced him, as it convinced his apologists in the West, of the almost total decadence and fundamental unseriousness of the West. Here was a spoiled upper-middle class Swedish girl claiming that her childhood had been stolen—by whom and by what, exactly?—and no one in any position of power or responsibility had the guts to tell her to shut up and to stop broadcasting her disgusting self-satisfied and highly privileged self-pity. Instead, she was the object of deference and almost of adulation, as if she were being brave in the way that anti-war demonstrators in Russia have been brave.

Why did no one in any position of power or responsibility take on little Greta and tell her to go away? The answer, probably, is sentimentality: She was young, and everyone knows that adolescence is the springtime of idealism. To destroy the fatuous illusions of the ignorant and inexperienced is cruel; therefore, we must submit meekly to be lectured, or hectored, by them, and to do as they say. The fact that the person in question may have been as manipulated as a cruise missile was not allowed to enter anyone’s mind.

One can just imagine little Greta Thunberg trying to hector Putin or Xi: The whole idea is so absurd that it can’t be entertained for a moment. It’s precisely for this reason, that Putin wasn’t decadent enough to take her seriously even for a moment, that some so-called conservatives in the West admired Putin: the enemy of my enemy being supposedly my friend. As we now see, Putin is not anyone’s friend: But Greta Thunberg was his friend, in what Stalin would have called the objective sense.

She was his friend because she, and those who thought like her, assisted in creating Europe’s extreme vulnerability to Russia’s control over its energy supplies. We don’t want nuclear; we don’t want coal; we don’t want gas; we don’t want oil. The reality, however, is that the population does want to be warm over winter, it doesn’t want the factories to close down, and it’s quite attached to the continuous electricity supply that so far renewables can’t guarantee. Thus, the political class paid lip service to the Greta Thunbergs and their like while continuing, and indeed extending, the continent’s dependence on energy from Russia—a potentially, and now actually, hostile power. Of Prime Minister Boris Johnson’s Net Zero policy, I can barely bring myself to speak.

Putin’s hand would have been much weaker had Europe not chosen to be so abjectly dependent on Russian energy. How he must have giggled—if giggling is in his repertoire—to see the fawning reception of Greta Thunberg in the West. With what contempt must he have regarded us, he, an ex-KGB operative who believes that the collapse of the Soviet Union was the greatest geopolitical tragedy of the 20th century. Thunberg and her ilk must therefore bear some of the responsibility for bringing about the war in Ukraine.

They wanted net zero: What they got was the scramble for more nuclear power stations, more oil and gas exploration, and even a resort to coal, plus Russia into the bargain.


Germany considers firing-up closed coal power plants

Will Germany's phase-out of nuclear and coal power plants be delayed because of the war in Ukraine? The Essen-based energy company RWE is considering restarting coal-fired power plants that have already been shut down.

In the debate about the best energy policy, Germany is pressing the reset button: no taboos, everything has to be put on the table again – that's what top politicians from the federal and state governments are saying in one way or another these days.

This also includes the thorny question of whether the nuclear phase-out planned for this year could be postponed and whether the coal phase-out should only take place after 2030. The energy politicians of all parties and the experts are all worried about gas supply from Russia. Natural gas from Putin's country currently covers more than half of Germany's gas requirements, and is essential for heating in private households and as fuel for industries, including power plants.

NRW Economics Minister Andreas Pinkwart (FDP) presented some theses to his counterparts from the other federal states on Monday, which were discussed in a special conference of economics ministers. Pinkwart is not at the forefront of those who want to postpone the nuclear phase-out, but believes that it should not be "ruled out without in-depth examination". A temporary extension of the running times should be "examined promptly by the federal government and discussed with the operators," said Pinkwart. He emphasizes that this can help to ensure security of supply without emitting significantly more greenhouse gases. This is currently happening because the coal-fired power plants are delivering more electricity.

The Federal Network Agency must “immediately check” whether the shutting down of hard coal and lignite power plants can continue at the planned pace and, if necessary, suspend shutdowns that have already been approved. Security of supply must now have top priority and not the exit date of 2030 favored by the federal coalition government.


Australia: Climate catastrophists see opportunity in disaster

While homes in Brisbane, Lismore and Windsor were swamped by floodwaters, again, and at least 15 people were losing their lives, and volunteers were taking risks to rescue others, climate keyboard warriors saw an opportunity to make political hay while the sun was not shining. “If not us, who?” tweeted so-called Voices of independent candidate Zoe Daniel above a reference to the latest climate report. “If not now, when?”

Thankfully, other Australians had a far more useful response to those two questions. They said “me” and “now” as they filled sandbags, crewed boats and delivered food to help others in need.

From surfing legend and great white wrangler Mick Fanning’s jet ski run for the local pharmacist, to two police officers diving under water into a Lismore house to rescue a 93-year-old woman floating on a mattress in an air pocket against the ceiling, the stories of help and heroism were great and small. But some climate crusaders sensed only an opportunity.

As they have done with bushfires, heatwaves, droughts, snowstorms (and lack of snowstorms) climate activists use wild weather to foster fear and further their political causes. Where some see natural peril and human tragedy, and act to help, others see dramatic images and political opportunity, then jump on social media.

Another so-called Voices of independent, Allegra Spender, posted pictures of the flood trauma with familiar slogans. She said a vote for her would “tackle climate change” and protect the environ­ment.

Presumably when people argue we should “follow the science” they mean we should stick to the facts and logic. Yet such an approach would see these climate catastrophists exposed as false prophets pushing false promises – they can no more alter the climate, let alone prevent natural disasters, than Superman can spin the planet backwards on its axis.

By science people tend to mean the increasingly alarmist papers published by the UN’s Intergovernmental Panel on Climate Change. There is much science behind these papers but also plenty of public relations in the way they are presented, with a rolling release of reports making the same points, which is why climate news sounds like deja vu.

We hear plenty about “tipping points” and last chances but seldom a word of scepticism, questioning of IPCC statements or references to the benefits of global warming; we get only doom and gloom. NASA findings on the carbon dioxide-induced greening of the planet or research about reduced mortality from milder northern hemisphere winters are not the kind of science the advocates follow.

Let us accept the general thrust of what the bulk of the climate scientists argue: that the Earth’s atmosphere is warming, that most warming is attributable to human-induced emissions and that we will see an increase in the regularity and intensity of weather events. Science also says much of this is baked into the atmosphere, even if we reduce emissions in the medium term, and that a global cut to net zero is necessary to reverse the trend.

There are debates to be had about weather records, interpretation of data, scientific modelling and forecasts. But the first thing to say about the climate activists’ response to natural disasters is that they are not new; floods, droughts, fires, heatwaves and storms have always been with us and always will be, especially in this land of droughts and flooding rains.

The pretence that climate policies can relieve us of these natural traumas is a ridiculously emotive and deceptive ploy. Do the activists really think they can deliver some Truman Show world where we dial up the weather we desire?

They are always desperate to use the word unprecedented so they can pretend global warming is visiting a wrath upon us that our forebears never knew. Every heatwave, cold snap, drought, flood or fire has to be worse than ever to suit their narrative.

In these pages I have demonstrated why this is untrue when it comes to the horrific bushfires in the summer of 2019-20. They were widespread, rampaging and deadly, but this country has had fires cover wider areas, kill more people and start earlier in the season. Firestorms are fearsome but, tragically, Australia will always suffer from them from time to time – always has.

Which is why grand plans to change the climate are unfortunate distractions from the protections that will work here and now, no matter what happens to the climate. We need to control fuel loads near settlements and ensure houses and properties are sufficiently protected in how they are built, where they are built and how much cleared area they are allowed or must have around them.

Despite repeated inquiries making recommendations about this, we have made little progress, and our complacency will lead to more damage from future fires. Instead of these difficult reforms, governments find it easier to buy firefighting aircraft that are useful for some fires but hopeless against the worst.

It is a similar story with floods. At Lismore this week’s flooding was the worst on record, more than 14m. But given there have been many floods over 12m, even in the 19th century, there will be other factors involved beyond climate, such as landclearing and urban build-up. Again, the practical solution to repeated inundations is not some fanciful plan to change the global climate but to adapt to a reality that has always existed and always will. If Lismore is the most regularly flooded town in the country, might we not rethink rebuilding in the same way at the same locations?

If we keep doing the same things we have been doing on fires, floods and droughts, and pretend our climate change policies will fix it, we are doomed to repetitive trauma. Dams can reduce flooding and droughtproof communities yet we seem to bust every dam proposed.

Even the entirely logical plan to extend the height of Sydney’s Warragamba Dam to mitigate the sort of flooding we have seen for two summers in a row has been held up by all the usual environmental objections. This is not rational or practical behaviour; science tells us floods will come and dams can manage them.

Instead of building dams, clearing bush around houses and ensuring buildings on flood plains can endure floods, activists pretend subsidising electric cars and mandating energy-saving light bulbs will tame our natural disasters, and too many politicians play along. Sometimes this country’s political system seems like a press release in search of governance.

Apart from the tackiness of spruiking for votes on the back of natural disasters, this is the first big lie of the climate alarmists: that their policies are the best way to eliminate or minimise the damage from natural disasters.

The second lie is even more preposterous because it goes to their propensity to deliver. Even if we accepted that controlling global climate was a reasonable and plausible goal, how, precisely, could an independent politician achieve this outcome?

To what degree, for instance, has Zali Steggall been able to reduce global greenhouse gas emissions and limit global warming. She has done as much on that cause as she has on world peace.

The Greens, Labor and the so-called Voices of independents fallaciously accuse the government of inaction on climate. Reducing emissions by 20 per cent already (up-ending our energy system to do it) and committing to net-zero emissions by 2050 is more than most nations do, and too much for many informed people, so it is a bit cute to dismiss it as inaction.

But let us say, for argument’s sake, that a few of the so-called Voices of independents and the Greens win the balance of power and install a Labor government that is dependent on them for survival. This is their dream scenario, where they could dictate climate policy.

So, we could pretend they get our country to net-zero emissions by 2030 (lord knows how, perhaps by closing all industries and building a dozen nuclear reactors). We could go even further and have them shut down our coal exports.

Would this, could this, change the climate? Between 2019 and 2021 China increased its emissions by 600 million tonnes and India by 200 million. In total, that amounts to double Australia’s annual emissions. In other words, if Australia’s 1.1 per cent of global emissions disappeared overnight, they would be replaced within a year by the global growth.

And no less coal would be burned, our exports would merely be replaced by other nations, as would the produce of our closed factories and farms, adding emissions elsewhere.

The scientific, economic and practical reality is that our self-harm would not reduce global emissions, therefore not improve the climate. That is what would happen in the extreme, impossible expression of the climate catastrophists loony plans.

So imagine the futility of whatever policy morsels they might cajole out of government. The pretence that any politicians, let alone so-called independents, can change the climate is misleading, ignorant and juvenile.

The eventual elimination of greenhouse gas emissions, so long as it is in concert with the rest of the world, makes sense. The way to do it in Australia, while protecting our economy, environment and sovereignty, might be through nuclear power (as France and Germany are suddenly rediscovering) and through abatement schemes involving revegetation, soil carbon and the like.

Climate change, like most other complex policy areas, needs to be tackled with factual, realistic and proportionate progress. Emotive, jingoistic and frankly silly claims about delivering us from Armageddon to Nirvana are not worthy of adult discussion, and certainly have no right to claim science as their defence.




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