海角大神

Recharge is a weekly e-mail digest of energy news and analysis聽written by Monitor reporters David J. Unger and Jared Gilmour.

Outages: Strong US oil output belies a shakier outlook abroad for the world鈥檚 most important energy source. The advance of IS has yet to disrupt any significant flows of crude 鈥� indeed,聽Iraq output could even rise in weeks to come. But the jihadist group displayed聽scorched-earth tactics in its retreat from the Baiji refinery聽this week, a strategy聽it may very well replicate with other infrastructure in the region. Meanwhile, Saudi Arabia's conflict聽with Houthi rebels in Yemen poses risks to聽critical centers of聽crude production and transit.

Air & water:聽With this week鈥檚 amendment to the Clean Water Act, the EPA opens up a second front of debate聽over how it defines deceptively simple concepts like 鈥渨ater,鈥� 鈥渁ir,鈥� and 鈥減ollutants.鈥� The clarified water rule will likely impact agriculture and other industry more than it will oil and gas, but the move sends a broader message: the Obama administration isn鈥檛 shying away from pursuing environmental goals, despite strong opposition in Congress and elsewhere. That鈥檚 the case with the Clean Power Plan,聽without which the nation will likely fall short of its targeted contribution to global climate efforts.

Amigos: North American energy trade is largely a petroleum-based affair, but with Mexico opening up its energy industry to outside investment, there鈥檚 room for expanded collaboration between the so-called 鈥淭hree Amigos.鈥� At a conference in Mexico this week,聽energy ministers from the three countries expressed a desire to go beyond oil聽and explore strategies for collaborating on low-carbon power grid integration, natural gas pipelines, and climate mitigation.聽鈥淸T]he most consequential part for further energy integration may very well be electricity,鈥澛燯S Energy Secretary Ernest Moniz told Bloomberg.

In the pipeline

• Monday, June 1: WASHINGTON 鈥撀燭he Atlantic Council hosts a discussion on the expanding role renewables play in US energy policy. Panelists include International Renewable Energy Agency chief Adnan Amin, and State Department energy envoy Amos Hochstein.
• Monday, June 1 to Tuesday, June 2: BERLIN 鈥撀燛urelectric, which represents European utilities, hosts its annual conference. This year鈥檚 theme is 鈥淭he Consumer Powered Energy Transition.鈥�
• Friday, June 5: VIENNA 鈥撀燨PEC holds a highly anticipated annual meeting. Most analysts expect the cartel will聽continue its strategy of maintaining output.

Drill deeper

Big compromises needed to meet carbon-emissions goal聽[Nature]
鈥淭he big picture is clear: on the basis of pledges made so far, the global average temperature is projected to rise by around 3鈥壜癈 above pre-industrial levels by 2100,鈥� writes Jeff Tollefson. Scientists are grading the strength of each country鈥檚 pledge, with one analysis rating China, the EU, and US as 鈥榤edium.鈥� Canada? 鈥榠nadequate.鈥�

Extreme City聽[The New Yorker]
Luanda hopes to become the Dubai of Africa, but it has a long way to go. Angola鈥檚 capital is a city whose oil wealth is only equaled by its inequality and its outrageous cost of living: Foreigners working in the oil industry shell out $105 for a single melon and $17 for a pint of H盲agen-Dazs ice cream, while most Angolans live on less than $2 a day. But now, without oil prices at $100 or above, the country has been forced to slash budgets and rethink an oil-driven economy.

Oil鈥檚 secret transit聽[The Philadelphia Inquirer]
The US oil boom has made Philadelphia refineries a major destination for crude oil traveling by rail. But with little public information on where those oil trains are headed, what they鈥檙e carrying, or what could happen in a derailment scenario, many in the city are worried about the 150 million gallons of flammable crude that roll into the city every week.

Energy sources

• Council on Foreign Relations: "The sharp decline in oil prices beginning in July 2014 offers a window of opportunity to roll back entrenched [fuel] subsidy schemes, since lower energy prices should make it easier to adjust domestic tariffs to something closer to market prices. Notably, countries such as India, Indonesia, Egypt, Kuwait, Oman, and Bahrain have recently taken steps to start unwinding some subsidies. "
• The Oxford Martin School at the University of Oxford: "It is necessary to limit cumulative emissions of CO2 to stabilise climate and hence limit the risk of dangerous anthropogenic interference in the climate system in the long term. But reducing [short-lived climate pollutants] may well be a more cost-effective way to limit the rate of climate change over the coming decades to ensure that ecosystems, food production and the economy can adapt, which also has a role in avoiding dangerous climate change."
• Stockholm Environment Institute: "[T]he climate implications of increased natural gas supply are far from straightforward. While building out new infrastructure for the supply and use of natural gas can support climate goals by avoiding the 鈥渓ock-in鈥� of new coal power plants, it also poses risks, for example, of 鈥渓ocking-out鈥� other, lower-emission alternatives. Achieving one while avoiding the other will require careful policy design."

Unplug

鈥淵emen Conflict Threatens to Add Entrenched Risk Premium and Price Volatility to Global Oil Market鈥�

鈥撀燬ecuring America's Future Energy

Recharge is a weekly e-mail digest of energy news and analysis聽written by Monitor reporters David J. Unger and Jared Gilmour.