Open Data Overview - The World Bank

World Bank data base now provides free access!  The new World Bank Data Catalog provides download access to over 2,000 indicators from World Bank data sets!

Libya unrest raises oil concerns (Al Jazeera)

Inside Story - Libya: Ready for civil war? (Al Jazeera)

Libya is currently imploding. It sits atop Africa's largest known petroleum reserves. This is (was?) approximately 10% of all EU oil imports. Tightness in oil markets mean that slight "ripples" can now have amplified effects. In systems terms, this would be the proverbial "bifurcation point," and all that can go with that in the political-economic sense, after a period of "unstable equilibrium" (which now characterizes the entire 21st century world economic system). In political and economic terms, the current situation is fraught with both danger and opportunity (wherein "danger" = "opportunity").

Oil prices now in a steep climb (again!): Brent (Europe) at $110.50, & WTI (USA) at 98.58 / barrel. [Note: in the minutes between viewing the above video, typing and uploading this piece, prices shifted yet again.]

Multiple factions of Libyan belligerents have threatened to blow up oil facilities, if their demands are not met. See the following blog, as but one example:

http://earlywarn.blogspot.com/2011/02/libya-oil-updates.html

In my class, at the University of Redlands, we've been discussing the political and economic implications of the same. Whether or not you are a student, or a member of the general public, we should all be watching Libya closely, now.


Blaine

WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices (Guardian UK)

To students in my University of Redlands course, SOAN 265-01 ("The Political-Economy of Energy Resources--Oil in the Global Economy"):  This recent information from Wikileaks, if true, bears out what many in the Peak Oil community have surmised / suspected / concluded from long ago.  Saudi Arabia, in the early years of the 21st century, and as the world's "swing producer," was very close to or at its inflection point in oil extraction.  Or, as the late Matt Simmons liked to put it:  "Once Saudi Arabia has peaked, then the world has effectively peaked."   This article points to a clear Saudi peak.  Furthermore, the US Gov't, operating in conjunction with several other governments and organizations, has actively tried to keep this information away from close public scrutiny for the past several years--presumably for fear of what it could do to markets.  Well, guess what?!   The cat is now out of the bag.  Only time will tell how the international community ultimately responds to all of this.  

While much of the world has been focused on events in Egypt recently (also important, to be sure), we should keep an eye on how the circulation this information might affect global energy markets, as well as political and economic policy-making (forming additional feedback loops to global energy markets, etc.).    


Special Note on Oil Price monitoring: At the very bottom of this web page, you can also find real-time prices for two different baskets / markets for oil--"Brent" (from the North Sea, off the coast of northern Europe), and "WTI" (West Texas Intermediate, from the Gulf Coast of the USA; and also the benchmark oil price used on NYMEX).  These are permanent apps located on this site, and they are constantly being updated.  

The link to the Guardian article is here: 

http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks

Please click on the above link, and read this article, and be prepared to discuss its possible implications in class.  Those interested in further reading on this subject may wish to check out the Matt Simmons book, Twilight in the Desert.  

Blaine D. Pope

*************

FULL TEXT OF ARTICLE HERE ALSO (formatting may vary slightly from original)

******************************************************

WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices

US diplomat convinced by Saudi expert that reserves of world's biggest oil exporter have been overstated by nearly 40%

WikiLeaks cables suggest the amount of oil that can be retrieved has been overestimated.

The US fears that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices escalating, confidential cables from its embassy in Riyadh show.

The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40%.

The revelation comes as the oil price has soared in recent weeks to more than $100 a barrel on global demand and tensions in the Middle East. Many analysts expect that the Saudis and their Opec cartel partners would pump more oil if rising prices threatened to choke off demand.

However, Sadad al-Husseini, a geologist and former head of exploration at the Saudi oil monopoly Aramco, met the US consul general in Riyadh in November 2007 and told the US diplomat that Aramco's 12.5m barrel-a-day capacity needed to keep a lid on prices could not be reached.

According to the cables, which date between 2007-09, Husseini said Saudi Arabia might reach an output of 12m barrels a day in 10 years but before then – possibly as early as 2012 – global oil production would have hit its highest point.
This crunch point is known as "peak oil".

Husseini said that at that point Aramco would not be able to stop the rise of global oil prices because the Saudi energy industry had overstated its recoverable reserves to spur foreign investment. He argued that Aramco had badly underestimated the time needed to bring new oil on tap.

One cable said: "According to al-Husseini, the crux of the issue is twofold. First, it is possible that Saudi reserves are not as bountiful as sometimes described, and the timeline for their production not as unrestrained as Aramco and energy optimists would like to portray."

It went on: "In a presentation, Abdallah al-Saif, current Aramco senior vice-president for exploration, reported that Aramco has 716bn barrels of total reserves, of which 51% are recoverable, and that in 20 years Aramco will have 900bn barrels of reserves.

"Al-Husseini disagrees with this analysis, believing Aramco's reserves are overstated by as much as 300bn barrels. In his view once 50% of original proven reserves has been reached … a steady output in decline will ensue and no amount of effort will be able to stop it. He believes that what will result is a plateau in total output that will last approximately 15 years followed by decreasing output."

The US consul then told Washington: "While al-Husseini fundamentally contradicts the Aramco company line, he is no doomsday theorist.His pedigree, experience and outlook demand that his predictions be thoughtfully considered."

Seven months later, the US embassy in Riyadh went further in two more cables. "Our mission now questions how much the Saudis can now substantively influence the crude markets over the long term. Clearly they can drive prices up, but we question whether they any longer have the power to drive prices down for a prolonged period."

A fourth cable, in October 2009, claimed that escalating electricity demand by Saudi Arabia may further constrain Saudi oil exports. "Demand [for electricity] is expected to grow 10% a year over the next decade as a result of population and economic growth. As a result it will need to double its generation capacity to 68,000MW in 2018," it said.

It also reported major project delays and accidents as "evidence that the Saudi Aramco is having to run harder to stay in place – to replace the decline in existing production." While fears of premature "peak oil" and Saudi production problems had been expressed before, no US official has come close to saying this in public.

In the last two years, other senior energy analysts have backed Husseini. Fatih Birol, chief economist to the International Energy Agency, told the Guardian last year that conventional crude output could plateau in 2020, a development that was "not good news" for a world still heavily dependent on petroleum.

Jeremy Leggett, convenor of the UK Industry Taskforce on Peak Oil and Energy Security, said: "We are asleep at the wheel here: choosing to ignore a threat to the global economy that is quite as bad as the credit crunch, quite possibly worse."

END OF ARTICLE

http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks


 Those interested in further reading on this subject may wish to check out the Matt Simmons book, Twilight in the Desert.

Political-Economic Turmoil and World Energy Prices

UNREST IN THE ARAB WORLD, Bahrain, Libya and Iran among flash points: 
Anderson's discussion with Fouad Ajami and James Woolsey



Source:  www.allthingsandersoncooper.com/2011/02/unrest-continues.html

To the students in my class at the University of Redlands (SOAN 265-01, "The Political-Economy of Energy Resources--Oil in the Global Economy"):  Please view the above 10 min video from the 17-Feb-11 CNN program "AC360."  Scroll about half-way down the page.  Take special note of what former CIA director James Woolsey had to say about political turmoil in the Middle East, and its potential impact on petroleum markets.   The next segment of reading for our course will focus on international security issues, as they relate to global energy markets in general, and petroleum in particular.  Please recall the "Oil Shockwave" simulation exercise we did a few weeks ago.  We are now seeing some of those issues actually come to light.  So, congratulations everyone!  You are now light-years ahead of the general American public (and most of your fellow university students) on these issues.  In the weeks ahead, we will continue to track global events like these, in real time, relating them to your coursework, along the way.

To general readers of this blog: We are here dealing with overlapping factors of international security policy, world energy markets, petroleum pricing, medium- to long-term international political-economic development issues, and how each of these then feed-back to issues of international security.  Increased levels of political insecurity can disrupt markets--especially oil markets.  Once that happens, and if the insecurity is sustained for a protracted period, we may begin to see increased prices at the gas pump.  Of course, students in my class now know that there is more to it than that, as virtually everything we consume today is touched by petroleum, or crude oil, in some way.

For those who don't know much about these issues but wish to know more, I would suggest starting with Blood and Oil, by Dr. Michael Klare (either the book or the DVD).

Blaine D. Pope


  

Vital Resources, Child Abuse, and “A Failure to Conduct Normal Scrutiny”

On 16 February 2011, in two different areas of The New York Times online edition, there was some rather disturbing news about mismanagement of two different-yet-vital areas of our national economy.   The first piece which caught my eye was entitled, “In Prison Interview, Madoff Says Banks ‘Had to Know’.”  This concerned the accused Ponzi scheme heavyweight champion and Tsar, Bernard Madoff, and the alleged role of advanced knowledge among some banks involved in building his financial empire of deceit.   The second was entitled “Auditors Find Federal Oil and Gas Oversight Still Lacking.”  This concerned the Governmental Accountability Office (GAO) review of ongoing (mis)management of our strategic natural resources in the petroleum sector (crude oil + natural gas), in the wake of the Deepwater Horizon disaster, of 20 April 2010. 

I only just read the Executive Summary of the Financial Crisis Inquiry Commission (FCIC) Report (released Feb. 2011, a great read, and available as a free download), plus a few other books on the topic of Wall Street malfeasance.  I am now seeing a very disturbing trend in this country.  This is a trend I had long suspected myself, but which is now being born out in selected “official” documents.  In many areas, the United States of America has been long suffering from a kind of internal rot—not just a management oversight rot, but something deeper than that.  This gets closer to heart and soul of this country, I fear.  It is a kind of rot of our national ethics—and a rot of the national spirit.     

There’s an old saying from Ghana, in West Africa: “The downfall of a kingdom begins in the homes of its citizens.”  Ghana has witnessed the rise and fall of many-a-kingdom over the past several centuries, so this saying has some weight with me.  In the case of modern America, I might add that the downfall should also include a number of corporate boardrooms, government agencies, and (dare I say it?) a number of our “finer” educational institutions. 

In short, we seem to have trained a large cohort of otherwise intelligent human beings to occupy leadership positions, but who have only the slightest, vaguest sense of a long-term national vision.   Instead, they think and live in the very-short-term: in the quarterly business cycle, and in the 2- and 4- and 6-year electoral cycle.  In the new epistemic world order of “measurable outcomes” this is where success is gauged, battles are fought, issues debated, and careers built.   And in the process of collecting these narrowly-defined measureable outcomes, we seem to be ignoring if not actually devouring our long-term, collective future.  Rome is burning; and our children will have only the embers of this once-great country to inherit, if this behavior continues. It is the sociological and historical equivalent of child neglect and abuse.  I fear we have stopped caring.   

I should add in the oft-used disclaimer, “if present trends continue.”   Recent Earth-shaking political events in Egypt (and elsewhere in the Greater Mediterranean Sub-region) have proven, once again, that present trends need not necessarily continue.  Here in the USA, one can now see a number of presently disturbing trends at the top of our society which should not continue.  The protracted (and willful?) lack of strong oversight of some of our most vital areas of political-economic activity will eventually bring this country to its knees.  The protracted lack of vision and dynamism needed for broad-based change and innovation will condemn this country to long-term mediocrity, or worse. 

The New York Times article of 16 February 2011 started this way:

The Government Accountability Office, weighing in somewhat belatedly, has found the

Interior Department’s oil and gas regulation and revenue-collection offices to be beset by

problems and in need of a major overhaul.

The G.A.O., the investigative arm of Congress, added the former Minerals Management

Service to its list of so-called high-risk programs, saying that the service is unable to account

for potentially billions of dollars worth of oil and gas recovered from publicly owned lands and

offshore areas. The auditors found that the agency has problems hiring, training and

retaining qualified staff, lacks the technical resources to monitor drilling operations and may

be losing billions of dollars a year in royalty payments owed the taxpayers.  

In short, at a time when the US Government desperately needs the cash, we—the taxpayers—still lack the proper government oversight to collect the revenues owed to us.   These are monies legitimately owed from the extractive industries to which we lease our precious federal lands. 

As if to sound conciliatory, the article concluded as follows:

The oil and gas program was the only government function added to the G.A.O.’s list of high-risk areas. Two programs were removed, the Pentagon’s personnel security clearance

program and the Census Bureau, which essentially has completed its 2010 data collection

work.

A number of other major federal functions remain on the watch list, some of which have been

there for years, including food safety, Medicare and Medicaid, financial regulation, tax

collection, weapons procurement, Pentagon contract management and protection of the

government’s information systems.

Okay, so how we pull in revenue from mineral extraction was the only area recently added to GAO’s high-risk category.   Thank heavens for small blessings!  Others have been on the “watch list” for years—including financial regulation.   Yikes!  “Rome” has been burning for a while, it seems.

On the topic of financial regulation (or the lack thereof) the Bernard Madoff article started as follows:

Bernard L. Madoff said he never thought the collapse of his Ponzi scheme would cause the sort of destruction that has befallen his family.

In his first interview for publication since his arrest in December 2008, Mr. Madoff — looking

noticeably thinner and rumpled in khaki prison garb — maintained that family members knew

nothing about his crimes.

But during a private two-hour interview in a visitor room here on Tuesday, and in earlier e-mail

exchanges, he asserted that unidentified banks and hedge funds were somehow “complicit” in

his elaborate fraud, an about-face from earlier claims that he was the only person involved.

His sense of loyalty to family values aside, it seemed that Madoff was willing to mention that selected banks were allegedly behaving as co-conspirators in the fabrication of his weapons of mass deception.   The article then meanders through a bramble of who said what to whom for a while—conveniently mentioning the author’s upcoming book on this very subject—before coming to this point at about the middle of the piece.

He did not assert that any specific bank or fund knew about or was an accomplice in his Ponzi scheme, which lasted at least 16 years and consumed about $20 billion in lost cash and almost $65 billion in paper wealth. Rather, he cited a failure to conduct normal scrutiny.

“He cited a failure to conduct normal scrutiny.”  That is all that was said about that: a failure to conduct normal scrutiny.  That was it: a mere glance at the fundamentals of our political-economic system.  The article then went on to describe more about who Madoff was working with to help recover some of the lost / stolen / swindled funds in the biggest Ponzi scheme in American financial history. 

We seem to be suffering from a protracted case of SDD (“scrutiny deficit disorder”) in this country now.  There is a world of something in all of this which, if we don’t get it under control, will affect our children and our grandchildren for decades to come. 

What we need now is “extraordinary scrutiny,” focusing on how we have been conducting our large-scale mission-critical activities: in business, in government, and in education in particular.  The downfall of a kingdom may begin in the homes of its citizens, but it is actually implemented elsewhere—in boardrooms, bureaucracies, and in classrooms.   These are the areas that we must watch.  These are the areas we must change.   Our collective future depends on this. 

Blaine Pope

Stunning solar towers light the way - video

The world's first commercial solar tower plant gives a breathtaking glimpse 

of the future of power generation. What's stopping the technology's 

widespread adoption?