The continuing demise of US fuel oil consumption

When commentators talk about the US cutting its oil consumption, they often cite the reductions in usage that were spurred by the first oil shock in 1973-1974. “See,” they say. “We did it back then, and we can do it again!”

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What they often fail to note is that one of the ways in which the US did dial back on its oil consumption is by drastically changing over its use of fuel oil for electricity generation to lots of other things: coal, natural gas, nuclear, alternatives. In 40 years, there have been plenty of things.

But the fact is if you’ve all but zeroed out your consumption of fuel oil, you can only do that once. That’s why the whole “we can do it again!” comes up short.

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Frozen Great Lakes and iron ore: just can’t let it go

Frozen may be an enormously popular film, but several videos of ice-encrusted ships on the US Great Lakes represent a horror show for much of the steel industry.

Up to four-feet thick sections of solid ice have mired huge ships from delivering essential coal and iron ore to steel mills. One video, shot as recently as April 12, showed the lakes had a long way to go before thawing, with the ice still 15-20 inches thick in some spots—enough to stall a big ship. (We were shown that video privately, so can’t link to it. However, a CBS News story that captures a few of the icy images can be seen here.)

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Shell Chemical woos the neighbors of its still-undecided Pa. ethane cracker

Shell’s $4 billion proposal to build a petrochemical complex on the site of the former Horsehead Corp. zinc smelter in Monaca, Pennsylvania, was on display Wednesday at two events at a banquet facility overlooking a golf course near the community, which lies about 30 miles northwest of Pittsburgh.

If constructed, Shell’s ethane cracker would feed production of 1.5 million mt/year of ethylene, 500,000 mt/year of gas-phased high density polyethylene, 500,000 mt/year of slurry HDPE, and 500,000 mt/year of linear low density polyethylene. Shell and Horsehead have extended Shell’s option to buy the Horsehead site along the Ohio River three times, most recently in December.

But the details of the proposal were not the main focus of Wednesday’s event. There was no PowerPoint presentation. No Q&A session. No leaflets. And significantly, still no indication that the project had been clearly decided as a “go.”

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Wall Street sees slide ahead for deepwater rig dayrates

In the controversial 1940s book The Fountainhead, arch-villain Ellsworth Toohey, who above all seeks power and control of other people, comments–and this is a paraphrase–that the way to topple a system is to make one small negative but still-key move in just the right place, and then sit back and watch the whole edifice implode as its members scramble for self-preservation.

Although Ayn Rand, the author of that book and fierce champion of individualism, hated the popular notion that “we’re all in this together,” the fact is that in oil markets and economic systems, we are.  One ominous signal–and even worse, a handful–can start a rumble that creates an earthquake.

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“Look out for the flags,” former Anglo boss warns miners

Most small mining companies are not in a position to look beyond funding the next stage of their project or trying to find a strategic partner. But a recent presentation at the Hong Kong Mines and Money conference gave an insight into how large mining companies take a much longer-term view, and how they consider all kinds of eventualities that could impact their business.

British-born Clem Sunter was CEO of Anglo American’s successful gold and uranium businesses in South Africa, and became the company’s expert in “scenario planning.” He and co-author Chantell Illbury penned a book on the subject, entitled Mind of a Fox, which became a best-seller in the wake of 9/11.

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EIA analysis: a big jump in crude oil stocks

Crude oil stocks in the US had been declining for several weeks, but they’re turned around significantly. This week’s Energy Information Administration report showed a significant build. You can read our analysis here.

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Could natural gas be the answer to London’s pollution concerns?

Over 8% of the deaths in some parts of London may be attributable to long-term exposure to man-made particulate air pollution, according to a new study from UK government body Public Health England.

The figures are highest for Kensington & Chelsea and Westminster (both at 8.3%), followed by Tower Hamlets, the local authority containing the international trading center of Canary Wharf (8.1%). In some rural parts of the UK the level is much lower, at around 2.5%.

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Regulation & Environment: Crude-by-barge not as controversial as its rail counterpart

Almost anything that moves has been pressed into serving the transportation needs of the expanding US production profile. That includes barges. In this week’s Oilgram News column, Regulation & Environment, Herman Wang reviews the safety considerations that the crude-by-barge industry faces.

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Michigan comes to Australia: Chevron MD draws stark comparison on LNG wages

The state of Western Australia is almost half the size of Russia but home to only 2.5 million people, almost 2 million of whom live in and around the state capital of Perth.

The pleasant city has grown rapidly on the back of Australia’s resources boom. The region’s fast-growing mining, oil and gas industries have seen sleek new office towers rise above the city’s older Victorian heritage buildings, staffed by neatly attired office workers pacing purposefully to well paid jobs, A$4 ($3.76) ‘flat white’ coffees in hand.

So it was a resource industry-friendly city in which to hold the Australian Petroleum Production and Exploration Association’s annual conference and trade show, which ran April 6-9 and attracted a record-breaking 3,600 delegates, making it – according to the organizers – the biggest oil industry conference in the southern hemisphere.

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IEA points to supply risks outside OPEC

A real prospect that export flows out of Libya can start to ramp up in the coming weeks after the resolution of a nine-month-long standoff with rebels couldn’t come at a better time for OPEC it seems.

According to the International Energy Agency’s latest monthly report, OPEC’s 12 members will need to pump an average of 350,000 b/d more during the second half of 2014 to meet global oil demand after their output slumped to a five-month low in March.

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