Talk of conflict in the Strait of Hormuz misses the real threat to the global oil market, says Derek Brower
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I’ll have a logistical update later, at tumblr.derekbrower.com. My post from April about how to get into Benghazi from the Egyptian border at Salloum was my most-read-ever post.
For now, I’ve used some downtime in Djerba to update more recent published pieces, mainly for The Economist and Petroleum Economist. They’re here.
I’m now updating more frequently at derekbrower.tumblr.com
It’s just a bit easier on the eye and definitely smart-phone friendly.
Sad Salloum (Photo: Eric Kampherbeek, http://www.lacouleur.nl)
I promised myself that when I was back from Libya I’d do a favour to other journalists — especially the freelance ones like me — and write a post about the specifics of getting into the rebel-held east. Forget the fears about heading into a warzone: before I left for Libya, it was the logistics that troubled me most. And, specifically, I was worried about how dicey or otherwise the trip across the north of eastern Libya would be.
It isn’t. The trip was safe. There’s a big difference between going to Benghazi, now deep inside rebel territory, and going to, say, Brega or Misrata. This post isn’t about that kind of trip.
So here, to prevent others going through the same fruitless Google search for information, is my Guide on How to Get from Egypt to Benghazi. Continue reading
I’m at home in Buxton watching the Masters, my kids are asleep upstairs, and Libya — where, inshallah, I’ll be on Tuesday morning — feels a long way off.
I had this great idea about six days ago: get to Benghazi and do a story on the Transitional National Council and its oil plans. Now that the tickets to Cairo for Eric Kampherbeek, a photographer, and me are booked, along with a hotel in Marsa Matruh (on the Mediterranean coast, west of Alexandria as you run your finger along to the Libyan border), I’m beginning to realise just how far in over my head I may be. Continue reading
Investment banks reckon we’re in for it. Opec says it’s happy where things are. China’s oil demand last year was 17.5% higher than the year before.
This is dangerous and short-sighted. In countries like the US and UK, fuel costs are within spitting distance of the records set in 2008, when a big wave of demand destruction spread across the West.
Inflation in China, which prompted two interest-rate rises in Q4 last year, is worrying the government. Another effort to dampen growth can’t be far off. The Fed may end quantitative easing if the US economy picks up, as data on Friday is expected to show it has. That will strengthen the dollar and drive down oil prices.
And the premium Brent (about $98/b) is enjoying to WTI (about $88/b) means we’re in for some kind of correction, soon. Expect a flattening of the contango and a dip in prices back under $80/b, if not lower. And expect the IEA to revise its demand outlooks back down again. Demand destruction, part 2, is on its way.
Update: Saudi oil minister Ali Naimi said today he’s worried about speculators again. No doubt. It’s 2008 all over again.
Update 2: I’ll be interviewing Opec’s Sec-General Abdallah El-Badri next week. Nice guy, always a good interview, always insightful, and with a lot on his plate at the minute.
My piece for The Economist on the tar/oil sands is out.
(“My”, by the way, is always a bit of a stretch for an author of an Economist piece, at least in my experience. In this instance, brilliant editors Patrick Lane and Oliver Morton, and Ottawa correspondent Madelaine Drohan, among others, were all heavily involved, too.)
One of the questions I’ve been getting is about the use of “tar sands” versus “oil sands”.
I think it’s a silly question. Yes, I know some Albertans, especially those working in the oil industry, don’t like the term (“It’s not tar!” or “It’s a loaded term!” are common cries). And, being more accustomed to “oil sands” when I write for others, I can sort of see the point. No question, “tar” sounds a tad filthier than oil — which I think sounds a bit dirty anyway.
But, really. People should get over themselves. The stuff looks more like tar than oil. The easiest way for tar-sands boosters to lose the battle over what they’re called is … to get upset about what they’re called. The best way for them to win it is to make “tar sands” a neutral term by using it themselves.
And think of the journalist’s plight. In a story about oil, it’s already difficult to find synonyms to prevent tedious repetition. “Oil”, “crude”, “petroleum” (all of which mean slightly different things, too), and so on. In a 3,000 word story about the tar sands, that “tar” lightens the load a little.
The other complaints about the piece so far have been from people saying that it’s unfair. That’s from both greens and oil execs. So we must have got something right.
