The haggling may have been unedifying, but the candidates nominated by the European Council to lead the European Union’s governing institutions are undoubtedly impressive. If approved by the European Parliament, German Minister of Defense Ursula von der Leyen and Belgian Prime Minister Charles Michel will become president of the European Commission and Council, respectively, and Spanish Minister of Foreign Affairs Josep Borrell will serve as High Representative of the Union for Foreign Affairs and Security Policy. Then, in November, Christine Lagarde is set to succeed Mario Draghi as president of the European Central Bank.

The good news is that each of these candidates would strengthen the EU at a time of global insecurity. The bad news is that the EU itself will continue to face significant challenges from within. The struggle to fill the top leadership positions resulted in the elimination of the Spitzenkandidaten process – whereby the largest party grouping in the European Parliament selects the Commission president – and the return of backroom deal-making, which many see as undemocratic. The justification for that change needs to be explained, or the EU’s credibility may suffer. After all, the Spitzenkandidaten process was introduced in 2014 to counter the perception that the EU suffers from a democratic deficit.

The leadership struggle has also intensified a clash of perspectives within – and about – the EU’s sources of legitimacy. Whereas member states with a strong parliamentary culture think the top personnel should be selected based on the results of May’s European Parliament election, others (like France) consider executive experience far more important than the link to those results. It is naturally a long process to devise a broadly accepted system for selecting EU leaders. Despite this year’s setback, the principle of the Spitzenkandidaten system should be preserved and combined in the next elections, with additional transnational lists of candidates backed by stronger trans-European party structures. Beyond that, the EU also needs to strengthen the role of the European Parliament.

A number of MEPs are deeply frustrated by the Council’s failure to nominate any of the Spitzenkandidats on offer, and they could make their sense of betrayal known by voting against von der Leyen’s appointment. Should her candidacy be rejected, months of institutional gridlock would likely follow. As a show of good faith, von der Leyen should announce early that she will work toward empowering MEPs de facto to initiate legislation. With an inter-institutional agreement with the European Commission, such a change would not require an amendment to any founding treaties. Moreover, if confirmed, von der Leyen and the new European Parliament president, David Maria Sassoli of Italy’s Democratic Party, should establish a working relationship as close as that of their respective predecessors, Jean-Claude Juncker and Martin Schulz. But, given the new composition of the European Parliament, they should strongly involve the chairs of all parliamentary groups that wish to work toward a stronger Europe.

The fact that MEPs elected Sassoli instead of the Council’s own candidate, former Bulgarian Prime Minister Sergei Stanishev, suggests that the European Parliament election in May has led to a renewed desire for institutional self-assertion. And yet the election left the body more fragmented than ever. The number of seats held in the 751-member parliament by the two main party groups, the European People’s Party (EPP) and the Progressive Alliance of Socialists and Democrats (S&D), fell from 404 to 336, owing to gains by the Greens, right-wing nationalists, and liberal centrists.

The fall of Europe’s grand coalitions and the emergence of new, smaller parties will impede decision-making, as already demonstrated by the Parliament’s failure to agree on its own Spitzenkandidaten. Divisions among the parliamentary groups are not just political, but also geographic. The EPP has almost no MEPs from France or Italy, and large delegations from Germany and Northern Europe. The S&D draws far more support from the Iberian Peninsula and Italy, with relatively few MEPs from the Visegrád group (the Czech Republic, Hungary, Poland, Slovakia) or France.

The increased fragmentation in the European Parliament goes hand in hand with changing relationships between EU member states. France and Germany’s days of working hand in glove are gone; and even if they do come together on a particular issue, blocking minorities can stand in their way at the Council. The latest round of EU leadership negotiations shows just how hard it has become to reach a majority, let alone unanimity. On the contrary, national governments fight increasingly recklessly for their interests. As a result, individual member states will face a strong temptation to pursue specific objectives in smaller, likeminded groups. The challenge, then, is to ensure that such initiatives follow official EU processes, rather than being decided through intergovernmental backroom deals.

The strong turnout in the European Parliament election indicates that the EU has not lost public support. The political center was strengthened at a time when Euroskeptic and nationalist parties are on the rise in member states. Overall, public trust in the EU is as high as it was in the 1980s, when European integration served as a defense against the Soviet Union. For most Europeans, being a part of the EU still means something.

But the outcome of the election also signaled a desire for change. Many citizens abandoned traditional parties, and a significant share of them did so out of fear. Like politicians at the national level, the EU’s new leaders will have to answer to voters who harbor deep uncertainties about their and their children’s future. Europeans are understandably anxious about great-power competition, new security threats, and a technological revolution that threatens to upend entire economic systems and societies.

The EU, working with member-state governments, will need to respond to these challenges with ambition and resolve. The European Council has already devised a strategic agenda for 2019-2024, and now the ball is in the European Parliament’s court. Since the elections in May, MEPs from the four moderate party groups have been negotiating a shared program of policy priorities. In other words, they are putting substance over personnel; regardless of who fills the top leadership positions, the European Parliament will already have a shared platform in place. Despite the circumvention of the Spitzenkandidaten process, this effort, like the slate of promising candidates selected by the Council, suggests that the EU is slowly and steadily maturing.

A tanker traveling from the Arctic region to Belgium with a cargo of Russian liquefied natural gas was instead sent to Israel at the last moment.

The British Diamond changed destination just before arriving, indicating how quickly natural gas traders need to act in a market where healthy inventories and supply have sapped prices to near their lowest in almost a decade. It may well be a sign of things to come for the rest of the summer, as the Asian benchmark Japan-Korea marker widens its premium to its European Title Transfer Facility counterpart and Middle East demand for cooling increases.

“You can see room for more diversions. It’s hard to believe JKM will strengthen any time soon, but TTF could weaken further as European stocks are full,” said Jean-Christian Heintz, head of LNG broking at SCB Brokers SA in Nyon, Switzerland. “It might rapidly become more attractive for cargoes to go to India and southeast Asia — they could be good opportunistic buyers in coming weeks.”

Two other tankers with gas from Russia’s Yamal LNG project have gone on month-long journeys to China rather than stop in Europe in recent weeks. That’s not surprising as even a heatwave last week was unable to prevent the rapid refilling of storage sites, which are 74% full, about 17 percentage points above their five-year average.

“If the demand-side response is not enough, prices will then need to fall to the point where either more power demand appears, or supply starts to be choked off,” Energy Aspects said in a note. “Either way, that would mean prices moving downwards from current levels.”

As European inventories are filling rapidly, traders may start looking at filling underground storage in the U.S. or choose to float cargoes on the water, according to Energy Aspects. The latter is looking attractive as prices for months later in the year are higher than for next month, known as a contango.

And the demand for power generation may also be limited. Even with natural gas becoming cheaper in the region than lignite for the first time ever, increased generation from renewables will probably curb the extra European demand, according to BloombergNE.

U.S. LNG cargoes may also prefer to go to Asia, supported by a wider inter-basin freight differential. With increasing volumes from new plants in the U.S. and Russia and a premium required to return empty ships after unloading in Asia, west of Suez shipping rates are higher.

One Yamal cargo is taking this season’s first voyage from Siberia via the Northern Sea Route to Asia, while transshipments of the project’s cargoes in northwestern European ports are also on the rise.

The question remains whether a few cargoes being sent to Asia rather than unloaded in the oversupplied European market will relieve the glut. Record LNG deliveries flooded liquid northwestern European markets in March and April, and while the wave has since subsided, shipments remain strong.

“At a certain point the market should regulate itself, if you see some supply going to Asia, it should help rebalance,” Heintz said. “Storages are so full that just a few cargoes less may not be enough to change the picture.”

أكدت صحيفة ليزيكو الفرنسية أن صندوق قطر السيادي أصبح أكثر انتشارا على الساحة الدولية ويعمل على تعزيز أعماله والتركيز على الاستثمارات في الولايات المتحدة وآسيا في السنوات المقبلة، وفي قطاعات مثل التكنولوجيا والصحة.

وبين التقرير المنشور أمس وترجمته “الشرق” أن هيئة الاستثمار القطرية استحوذت للتو على حصة قدرها 250 مليون دولار، أي أقل من 5 ٪ من رأس مال المجموعة الهندية “BYJU’S”، في قطاع التكنولوجيا التعليمية. وبعد فترة من الهدوء المرتبط بالحصار الاقتصادي الذي عانت منه الدوحة منذ عام 2017، أصبح صندوق الاستثمار الحكومي أكثر إقبالا على المشاريع ونشاطا في السوق العالمية.

◄ توسيع الاستثمارات
وأورد التقرير أن سعادة الشيخ محمد بن عبد الرحمن آل ثاني، نائب رئيس الوزراء وزير الخارجية، ورئيس مجلس إدارة جهاز قطر للاستثمار، في مقابلة مع فاينانشال تايمز: “في الأشهر الستة الماضية أكد: كنا نشطين للغاية، خاصة في أمريكا الشمالية. ما زلنا نستثمر في أوروبا، لكننا أكثر تركيزًا على آسيا والولايات المتحدة.” وتابع التقرير خلال زيارة رسمية لباكستان، أظهر الصندوق القطري اهتمامه بالاستثمار في قطاعات الطاقة والسياحة والإسكان. مثله مثل عدد من نظرائه، فهو مهتم بإمكانيات السوق الهندية الواسعة. وفي القارة الأوروبية، تحدثت التقارير العالمية عن استحواذ قطري على أسهم في بنك دويتشه، حيث استثمرت الدوحة بالفعل في 6.1 ٪ من حصة.

وحسب الصحيفة الفرنسية، فقد استثمر الصندوق في شركات الإدارة، ليسيطر على المشاريع الكبرى، بالإضافة إلى قطاعات مثل التكنولوجيا والصحة،. كما استثمر هذا العام في شركة سان فرانسيسكوالأمريكية، SoFi، في قطاع التمويل الشخصي عبر الإنترنت، واستأنف عمليات الشراء في العقارات الفاخرة في مانهاتن بنيويورك. وحصل على 200 مليون جنيه إسترليني في المجموعة البريطانية Severn Trent في إدارة الموارد المائية.

وبين عامي 2010 و2018، حقق الصندوق القطري زيادة سنوية في متوسط رأسماله بنسبة 21 ٪، الذي يبلغ حوالي 300 مليار دولار وفقا لصندوق النقد الدولي. وفي تقرير نُشر في يونيو، تم توضيح أنه يتم استثمار نصف الأصول في الأسهم المدرجة، و20 ٪ في السندات و30 ٪ في الأصول البديلة (العقارات، والأسهم الخاصة، وصناديق التحوط).

◄ تقدم قطري
وفي تقرير سابق قالت صحيفة ليزيكوالفرنسية إن قطر نجحت في تجاوز أزمة الحصار، حيث رفضت خطة الاستسلام الجيوسياسي المكونة من 13 نقطة والتي طالبت بها دول الحصار ومنها إغلاق قناة الجزيرة، وتمكنت من الصمود بمرونة عالية، وواصلت عمليات التوريد للبضائع والمواد الاستهلاكية، ووجدت طرقا جديدة لتحقيق اكتفائها الذاتي من خلال التعاون مع عدد من البلدان على غرار الكويت، تركيا، إيران، الدول الأوروبية، المغرب، الهند، الصين، سلطنة عمان. وفي هذا الصدد صرح رجل الأعمال رودي بارودي ليزيكو: “لقد أظهرت قطر صمودا وتماسكا وطنيا، ولم تتوقف عن الاستثمار”.

وبينت الصحيفة أن الدوحة رفعت سقف الملكية الأجنبية في أي مشروع محلي إلى 49%، مقابل 25%، وأطلقت برامج دعم كبيرة للصناعة المحلية، وقامت ببرامج لتحقيق الاكتفاء الذاتي منها إنشاء أكبر مزرعة لمنتجات الألبان في الشرق الأوسط في وقت قياسي لتغطية احتياجات السوق الاستهلاكية، حيث ساعدت هذه التدابير في تجنب النقص والزيادات التضخمية.

وذكرت الصحيفة أنه حسبما ذكر صندوق النقد الدولي في تقرير له في مارس الماضي، فإن تأثير الحصار كان عابرا، لم يتعد كونه انتقاليا، حيث تمكنت المؤسسات المالية القطرية كالبنك المركزي وصندوق الثروة السيادي، وجهاز قطر للاستثمار من ضخ السيولة وحماية الاقتصاد القطري من تداعيات الأزمة الخليجية، كما حققت قطر مرونة اقتصادية كبيرة بفضل إستراتيجيتها في التأثير والتأمين.

By Mark Paul

SARASOTA — US President Donald Trump’s anti-climate agenda is in full swing. His administration has already taken action 117 times to repeal or weaken climate regulations, and much more deregulation is in the works. By unravelling environmental protections on an unprecedented scale, including through executive orders, Trump is using every tool at his disposal to increase fossil-fuel extraction and the production of dirty energy. Apparently, he is hell-bent on topping his predecessor’s own fossil-fuel boom.

That is right, former President Barack Obama presided over a fossil-fuel boom: the domestic shale-energy revolution enabled by the advent of hydraulic fracturing (or fracking). The fact is that neither major party in the United States has been the climate champion that the country and the world needs. While young activists around the world are stepping up to show what true climate leadership looks like, politicians are barely taking note. As Dianne Feinstein, a Democratic US senator from California, dismissively told a group of young people advocating a Green New Deal (GND): “I’ve been doing this for 30 years. I know what I’m doing.”

The longer both parties cling to a policy of “business as usual”, the more likely we are to face a climate catastrophe in which millions of people perish or have their lives upended. In reality, though, the responsibility for adopting a new paradigm ultimately rests with the Democrats. While Trump has been disastrous for the planet, his administration’s policies are in keeping with a Republican Party that will not change anytime soon.

In a recent review of more than 1,000 climate-related bills introduced in the US Congress since 2000, we found that, in the past decade alone, Republicans presented 187 that would increase greenhouse-gas (GHG) emissions. Most of these bills have sought to advance the interests of the fossil-fuel industry over those of everyone else. The Republicans’ purported rationale is to achieve “energy independence,” which, in practice, has meant offering special treatment to the oil, gas and coal companies that spend exorbitant amounts on campaign contributions.

Not long after coming to office, Trump promised that by unleashing America’s fossil-fuel reserves, his administration would “create countless jobs for our people, and provide true energy security to our friends, partners and allies all across the globe”. Following the same logic, Don Young, a Republican congressman representing Alaska, has introduced the American Energy Independence and Job Creation Act, which would allow exploration and extraction of oil and gas reserves in Alaska’s Arctic National Wildlife Refuge. Adding insult to injury, the bill would direct half of the tax revenues generated by the exploitation of public resources to a pot of incentives for the fossil-fuel industry.

But the real insult is the behavior of Democratic leaders, who continue to abide by what James K. Boyce of the University of Massachusetts calls “climate-change denial lite”. Consider the case of the Democratic National Committee (DNC). Last year, the DNC decided that it would no longer accept contributions from political action committees affiliated with the fossil-fuel industry, only to reverse course and embrace an “all-of-the-above” energy policy just months later.

Though congressional Democrats have introduced modest proposals to curtail GHG emissions, they have not made any major push for climate legislation since the failed American Clean Energy and Security Act of 2009 (the Waxman-Markey bill). And even that bill would not have reduced emissions fast enough, relative to what the climate crisis demands.

Among the more meaningful climate bills introduced by Democrats in recent years is the 100 by ‘50 Act, which includes provisions to “achieve 100 per cent clean and renewable energy by 2050”. But, again, this falls far short of what is needed to limit global warming to 1.5ºC above pre-industrial levels, the threshold beyond which the Intergovernmental Panel on Climate Change forecasts devastating consequences.

Fortunately, a growing chorus of Democrats has begun to demand genuine action that would start to make up for decades of climate-change denialism lite. They understand that without significant, comprehensive action by the US, the climate cannot possibly be stabilised at a level that is still conducive to human flourishing.

Rather than talking about what people must give up to reduce emissions, the climate realists are trying to sell voters on a new vision of the economy, one that offers long-term economic security and environmental stability. The GND resolution introduced earlier this year has rapidly shifted the window of discourse, such that once-radical proposals are now garnering public support and being debated seriously.

Though the details of the GND still need to be fleshed out, Democratic presidential contenders such as Washington Governor Jay Inslee are already offering concrete proposals in accordance with its prescriptions. The GND could be the “north star” of the country’s decarbonisation path. But much will depend on Democratic congressional leaders such as Speaker of the House Nancy Pelosi, who has scoffed at ambitious climate proposals as a “green dream.” Either that changes, or we will all find ourselves in an environmental nightmare.

Mark Paul is an assistant professor of economics at New College of Florida. Copyright: Project Syndicate, 2019. www.project-syndicate.org

http://jordantimes.com/opinion/project-syndicate/americas-bipartisan-climate-policy-failure

LONDON (Reuters) – Trade tensions risk throwing the global economy’s transition to greener energy into disarray and could hurt energy companies’ preparations toward it, BP Chairman Helge Lund said as leaders of the world’s largest economies gather for talks in Japan.

Lund, in his first interview since taking office in January, said BP would rather see a rapid, orderly phasing out of fossil fuels than a delayed and disorganized transition.

The former chief executive of Norwegian oil group Equinor said BP as well as rivals such as Royal Dutch Shell (RDSa.L) and ExxonMobil (XOM.N) would have a vital role to play to ensure a successful transition to low carbon economies.

“It is better for us to see a path that goes rapidly,” Lund said. “It will be very difficult for the oil and gas companies but that is a better and a preferred solution than an uncontrolled sudden change maybe 10, 15 years into the future.”

London-based BP, like some of its peers, has taken steps toward meeting the 2015 Paris Climate Agreement to limit global warming, including setting targets to reduce carbon emissions from its operations, link them to managers’ pay and ensure that investments are in line with the accords.

But many investors say BP will have to do more, including tackling emissions from the fuels and products it sells to millions of customers daily, known as Scope 3 emissions, to prevent a catastrophic rise in global temperatures.

Lund said however that such Scope 3 targets would tie BP’s hands to make future investments, whether in renewable energy or oil and gas. He nevertheless said the company’s thinking around Scope 3 was likely “to evolve over time.”

BP invested around $500 million in renewable power, electric vehicle charging points and other low-carbon technologies last year, a fraction of its annual spending of $15 billion.

And the pressure on companies and governments to do more to curb greenhouse gases is rising as carbon emission levels show no sign of decreasing.

Investors managing more than $34 trillion in assets, nearly half the world’s invested capital, this week demanded urgent action from governments on climate change, piling pressure on leaders of the world’s 20 biggest economies meeting this week.

France has said it will not accept a final G20 communique that does not mention the Paris climate change agreement.

“The long-term framework around the energy transition is important. Over time it is much easier for big companies like BP if we have a stable global framework for trade and investments,” Lund told Reuters at BP’s London headquarters.

Lund said an unprecedented level of cooperation was needed between companies and governments to bring greenhouse gas emissions to zero by the end of the century.

He urged governments to introduce a price on carbon emissions to allow phasing out fossil fuels, even though only a handful of such schemes have been introduced around the world.

SOUND INVESTMENT

BP has faced a wave of protests by climate activists, including a blockade on its London office and protests at events the company sponsors.

Big investors, including Norway’s sovereign wealth fund, are reviewing shareholdings in some oil and gas drillers, though not in BP and its largest rivals.

Lund, who took part in discussions on a climate resolution with a group of investors earlier this year, believes most investors understand that modern societies are almost built on hydrocarbons.

BP forecasts that even with a rapid increase in wind, solar and other forms of renewable energy, fossil fuels will account for the majority of energy supply for decades to come.

Lund also warned that attempts to curb fossil fuels too fast could harm societies.

“It takes time to change energy systems … If you try to build down the oil and gas industry quicker than you are able to build up a carbon neutral system you will pull societies back.”

Lund said large oil companies would be vital for the transition due to their large balance sheets, technical expertise and innovation skills.

“To be a strong contributor in the long term we have to stay financially strong, we have to be a good investment.”

Lund also said: “There is another dimension that we need to think about and that is if you believe that BP and other integrated oil and gas companies understand energy markets, they have significant balance sheets, they have technical capabilities, they have innovation capabilities, they can take risks – so in my mind business and these companies play an incredibly important role in the energy transition.”

SUCCESSION

Lund, 56, faces the task of leading BP through the energy transition and also overseeing the succession to Chief Executive Bob Dudley, who took the helm in 2010 following the crisis over the Deepwater Horizon rig explosion in the Gulf of Mexico.

Dudley also steered BP through the oil industry’s worst downturn in decades so that the company is now producing strong profits which reached a five-year high last year of $12.7 billion.

“Bob is a very good leader, I am not sure where BP would have been without him,” Helge said.

BP’s board would ensure that when Dudley, who turns 65 next year, steps down, there will be “at least a number of candidates who can compete for the job,” he added.

Lund, a former consultant and political adviser in the Norwegian parliament rejected suggestions he could replace Dudley to become the next CEO.

“I’ve been CEO for three companies. I thought about this when I left BG whether I should try to get one more (CEO) job or try to get a different life and I decided on the latter and I think it is rewarding,” he said.

Time is running out for car makers in Europe. Just six months out from stiff new emissions rules, the industry is facing up to an estimated €34bn ($39bn) in penal- ties as well as eroding profits from selling more electric cars. Starting in 2020, car fleets in Europe will need to meet more stringent regulations on how much carbon dioxide they’re allowed to release. The industry is ill prepared for the looming change, and the huge fines pending for subverting the new rules could prompt some brands to abandon the European market and test the mettle of those that remain. The threat is part of a broader pileup: vehicle sales are falling in key markets around the world, and the US is exchang- ing blows on trade with China and the European Union, threatening to raise costs and rattle the global economy. Worse yet, automakers have been unable to pry buyers from the highest-emission cars, such as the Mercedes-AMG GLE 63 S sport utility vehicle that spouts more than three times the car maker’s targeted CO2 fleet level from 2020. “In an industry that is already suff ering from global trade issues, from Brexit, from peaking sales, that’s a very, very danger- ous cocktail,” Evercore IS auto analyst Arndt Ellinghorst said on a call earlier this month regarding the EU emissions issue.

Fines could mount to €34bn through 2021, according to research firm Jato Dynamics, whose projection tracks with other indus- try estimates. While the new regulations are expected to be painful for the industry to adjust to, past precedent suggests the EU is unlikely to allow Europe-based carmakers to be driven to ruin. Volkswagen AG, the world’s biggest car- maker, faces the largest penalty at about €9bn based on 2018 reported emissions, followed by Peugeot maker PSA Group and Fiat Chrysler Automobiles NV — the company with the single largest gap between actual performance and the new targets. BMW AGand Daimler AG could see earnings drop sharply due to their heavy reliance on high-emission SUVs. Toyota Motor Corp, maker of the Prius and several other hybrids, was the only automaker to see its emissions fall last year in Europe, according to Jato. While its calculation doesn’t take into account a blitz of upcoming electric models like Volkswa- gen’s ID.3 hatchback and Porsche Taycan, European Environment Agency data show emissions rising — not falling — for the past two years to a four-year high in 2018. Fumes are emitted from the exhaust pipe of an Audi in London. A Volkswagen spokesman reiterated recent comments by off icials including chief executive of- ficer Herbert Diess that it’s the company’s goal to meet European emission limits. A spokesman for BMW said paying fines wasn’t a strategic option, and the company on Tuesday brought forward its planned rollout of electric cars by two years. Daim- ler said its plan to reach the targets also depended on customer decisions. “It’s not quite an existential problem yet, but there are going to be questions of how do you explain to shareholders that I’m losing so much money, and it’s going to create immense pressure,” Michael Schweikl, managing consultant responsi- ble for automotive at PA Consulting Group, said in an interview. Starting January 1, all but 5% of the EU’s car fleet can emit no more than 95 grams of carbon dioxide per kilometre driven. One year later, no new vehicle can exceed that level.

Fines of 95 euros per gram for each car over the target will add up quickly, driving automakers to speed up the electrification of their lineups by of- fering more gasoline-electric hybrids and cars fully powered by batteries. “I have never seen such a material event risk in my career,” Evercore’s Ellinghorst warned in a research note to clients last month under the subject line “The 2020 CO2 cliff .” Automakers aren’t panicking — yet. PSA expects to be compliant from day one and won’t pay any fines, a spokesman said. However, in 2018, sales of EVs and hybrid vehicles accounted for less than 1% of PSA’s registered sales. The quandary on CO2 doesn’t end there, because in addition to being less popular, low-emission cars are much less profitable than the rest of automakers’ fleets. At Volkswagen, less than 1% of sales were plug-ins or battery cars last year, and about 6% at BMW. An analysis by UBS last year estimated Ebit margins on Tesla Inc’s Model 3 sedan were, at best, half those of BMW’s gasoline-powered 330i model.

The push for electrification in Europe means selling mass-market vehicles there will be unprofitable “for a decade or two,” John Murphy, an auto analyst for Bank of America Merrill Lynch, said during a presentation this month in Detroit. The 2020 limits were agreed to in 2014 after years of back-and-forth on balanc- ing a reduction in emissions while not costing carmakers too much. What no one foresaw was the extent of consumers’ love aff air with gas-guzzling SUVs and Volkswa- gen’s diesel-emissions cheating scandal that surfaced the following year. Diesels, which emit about a fifth less CO2 than equivalent gasoline cars, were a key plank in carmakers meeting the tighter regulation. But some European cities have started to ban diesels, leaving the cars to languish on dealer lots. “The top automakers will face trouble as none of them are currently on track to meet the target,” Jato Dynamics said in an April blog post. “The incoming CO2 targets can be seen as the apocalypse of the car industry in Europe.” The new rules may prompt some brands without a strong presence in Europe to abandon the market altogether, said Ellinghorst, though he declined to specify which might do so. General Motors Co already eff ectively withdrew in 2017 when it sold the Opel brand to PSA. Companies without fully-electric vehicles in Europe such as Ford Motor Co and Japan’s Mazda Motor Corp face steep challenges. Honda Motor Co does too, but it plans to launch a small battery-electric model later this year. Ford said in a statement it expects to meet the 2020-2021 targets, but that its longer- term strategy in Europe through 2030 “assumes a strong uptake of electrified vehicles” by consumers. Representatives for Mazda had no immediate comment. If the industry fails to clear the new bar set by regulators, it won’t be the first time.

When many automakers missed the boat on the switch to new emissions testing in September, it was nearly enough to send Europe’s largest economy into recession. Employees work on BMW i3 electric cars on the assembly line at a factory in Leip- zig, Germany. Simply selling more small cars won’t help, as even the most fuel-eff icient gas-pow- ered vehicles also face tougher mandates. Carmakers aren’t likely to be able to pass along the added costs for equipping those cars with cleaner technology, Bernstein analyst Max Warburton wrote in a recent report. He said that may lead to “the death of the small car” in Europe. The regulations do allow for some creative ways to lower average fleet emissions and mitigate penalties, at least during a phase- in period. Cars that emit less than 50 grams CO2 per kilometre will count for two cars in 2020, and slightly less each year after. Fiat Chrysler has also made use of the op- tion to pool fleets of high-emission autos with low- or zero-polluting cars, pairing up with Tesla Inc in a deal that likely will involve paying the US company several hundred million dollars. Mazda and Toyota are also forming a pool. “I think that 2020 is doable. The concern is about customer acceptance for new technology,” said Antonio Massacesi, head of fuel economy and greenhouse gas compliance for Fiat Chrysler’s European business. “That risk is one of the reasons why we decided to enter into a pool with Tesla.”

Riyadh’s production cuts to support the oil price have caused domestic stocks to plummet

Saudi Arabia’s crude oil inventories have fallen under 200 mn bl for the first time in a decade as the Kingdom’s production cuts continue, according to Jodi data released on Wednesday.

The Kingdom’s oil stocks fell to 193.4mn bl in April, representing a 17pc drop year-on-year. It is the lowest inventory level since February 2009, when the price of  WTI was just $35/bl.

The decline in stocks continues a trend that has gathered speed since the inventory peaked at 329mn bl in September 2015. The trend accelerated in Q1 due to crude refinery runs growing 8pc to 2.653mn bl/d and a 7.4mn bl draw during April alone.

However, the inventory decline comes despite a rise in average production in the Q1, year-on-year, by 0.7pc to 9.993mn bl/d. Average monthly oil exports during Q1 2019 were 1pc lower than the same period in 2018, at 7.137mn bl/d.

Opec+ production

Opec+ members agreed last December to cut a combined 1.2 mn b/d of production. Saudi Arabia is contributing the lion’s share of Opec’s 800,000 bl/d contribution, which equates to roughly 6pc of its income.

Saudi Arabia needs to maintain stable production and export figures to limit the damage to the government’s coffers.

Saudi rulers are also mindful maintaining good relations with the US Trump administration. By ensuring the global oil market is well supplied it bolsters the partnership that is aligned against the shared regional rival, Iran.

The price of WTI plummeted 23pc from a high of $66.5/ bl in mid-April to $50.82/ bl in early June, led by global demand concerns worsened by the US-China trade war as well as continued growth of US inventories.

The price slide persisted until a bomb attack on shipping in the Gulf led to rising tensions and a subsequent price surge starting 19 June.

All eyes are now on the Opec+ meeting to be held in in Vienna on 1-2 July, where the organisation will decide whether to extend the cuts.

With solar and wind power already the cheapest source of new power generation across two-thirds of the globe, analysts at Bloomberg New Energy Finance (BNEF) have predicted Europe will lead the race to decarbonize its grid.

The authors of this year’s New Energy Outlook report, published today, expect Europe to generate 92% of its electricity from renewables by 2050 thanks to carbon pricing and other supportive policies. The U.K. last week voiced a net zero carbon 2050 ambition and it is expected Ireland and the EU will follow suit in due course.

Power sector emissions in China, however, are not set to peak until 2026 – thanks to an extensive modern coal power fleet – although they are expected to decline by more than half in the subsequent 20 years. That is in part because of an anticipated rise in demand for electricity of more than 50% by 2050, with Asia due to present a $5.8 trillion power demand market – more than half the global figure during that period – and India and China alone a $4.3 trillion opportunity.

The U.S. will also lag behind Europe when it comes to decarbonization, according to the annual study, which is based on analysis of the costs of competing energy technologies. Renewables will more than double their contribution to the U.S. energy mix, to 43% in 2050, but will have to complete with abundant natural gas in a $1.1 trillion new energy capacity market.

Renewables are the big winner

Despite the prevalence of natural gas in the U.S., the New Energy Outlook 2019 study predicts that as an energy source, gas will occupy roughly the same share of the market in 2050 as it does today, as will hydropower and nuclear. Oil will have disappeared as a source of energy by mid century, added the BNEF report, and coal – which supplies 37% of power generation today – will have been reduced to a 12% slice of the pie.

Renewables, helped by lithium-ion battery storage will fill the void, according to BNEF, with a rise from 7% of power generation today to 48% by 2050.

That is down to an estimation price reductions in solar, energy storage and wind technologies will continue at rates of 28%, 18% and 14%, respectively, for every doubling in installed capacity. If those predictions are borne out, renewables will supply and store more energy than coal and gas “almost everywhere” by 2030, stated the report.

The good news is that would ensure the world stays on track for global heating of less than two degrees Celsius by 2050 up to the year 2030, without the need for any new public money incentives for renewables in the next 15 years. Beyond that point, however, new technologies would be required as renewables could top out at contributing 80% of energy generation in many countries by 2050.

New solutions needed

That would mean innovations and alternative solutions such as nuclear, biogas-to-power, green hydrogen-to-power and carbon capture and storage would need to be rolled out after 2030, which in turn would require significant spending on R&D before that point.

One other requirement needed to keep us on track as far as 2030 would be for power markets to be reformed to correctly acknowledge, and reward, the role played by renewables and storage in helping the grid.

In a press release issued to publicize today’s BNEF report – which also considers the potential carbon savings to be made in a world with fully electrified transport and building heating – the organization’s head of energy economics Elena Giannakopoulou stated: “[The] NEO [New Energy Outlook] is fundamentally policy agnostic but it does assume that markets operate rationally and fairly to allow lowest cost providers to win.”

Therein lies the rub, perhaps.

Renewable energy has become an increasingly competitive way to meet new power generation needs. This comprehensive cost study from the International Renewable Energy Agency (IRENA) highlights the latest trends for each of the main renewable power technologies.

Released ahead of high-profile United Nations energy and climate discussions, Renewable Power Generation Costs in 2018draws on cost and auction price data from projects around the world.

Download the chart data

Costs from all commercially available renewable power generation technologies declined in 2018. The global weighted-average cost of electricity declined 26% year-on-year for concentrated solar power (CSP), followed by bioenergy (-14%), solar photovoltaic (PV) and onshore wind (both -13%), hydropower (-12%), geothermal and offshore wind (both -1%),the report finds.

Continuing cost declines, meanwhile, underline renewable power as a low-cost climate and decarbonisation solution. Within IRENA’s global database, over three-quarters of the onshore wind and four-fifths of the utility-scale solar PV project capacity due to be commissioned in 2020 should provide lower-priced electricity than the cheapest new coal-fired, oil or natural gas option, the report notes.

Among other findings:

• Onshore wind and solar PV power are now, frequently, less expensive than any fossil-fuel option, without financial assistance.
• New solar and wind installations will increasingly undercut even the operating-only costs of existing coal-fired plants.
• Low and falling technology costs make renewables the competitive backbone of energy decarbonisation – a crucial climate goal.
• Cost forecasts for solar PV and onshore wind continue to be revised as new data emerges, with renewables consistently beating earlier expectations.

Along with reviewing cost trends, the report analyses cost components in detail. The report draws on IRENA’s cost database of around 17 000 renewable power generation projects and 9 000 auction and power purchase agreements for renewable power.

Sample figure

Utility-scale solar PV:

Total installed costs in 2018 by component and country

The industrial sector of the worldwide economy consumed more than half (55%) of all delivered energy in 2018, according to the International Energy Agency. Within the industrial sector, the chemicals industry is one of the largest energy users, accounting for 12% of global industrial energy use. Energy—whether purchased or produced onsite at plants—is very important to the chemicals industry, and it links the chemical industry to many parts of the energy supply chain including utilities, mines, and other energy product manufacturers.

The chemicals industry is often divided into two major categories: basic chemicals and other chemicals. Basic chemicals are chemicals that are the essential building blocks for other products. These include raw material gases, pigments, fertilizers, plastics, and rubber. Basic chemicals are sometimes called bulk chemicals or commodity chemicals because they are produced in large amounts and have relatively low prices. Other chemicals—sometimes called fine or specialty chemicals—require less energy to produce and sell for much higher prices. The category of other chemicals includes medicines, soaps, and paints.

The chemicals industry uses energy products such as natural gas for both heat and feedstock. Basic chemicals are often made in large factories that use a variety of energy sources to produce heat, much of which is for steam, and for equipment, such as pumps. The largest feedstock use is for producing petrochemicals, which can use oil-based or natural-gas-based feedstocks.

In terms of value, households are the largest users of chemicals because they use higher value chemicals, which are often chemicals that help to improve standards of living, such as medicines or sanitation products. Chemicals are also often intermediate goods—materials used in the production of other products, such as rubber and plastic products manufacturing, agricultural production, construction, and textiles and apparel making.

The energy intensity of the basic chemicals industry, or energy consumed per unit of output, is relatively high compared with other industries. However, the energy intensity of the basic chemicals industry varies widely by region, largely based on the chemicals a region produces. According to EIA’s International Energy Outlook 2018, Russia had the most energy-intensive basic chemicals industry in 2015, with an average energy intensity of approximately 98,000 British thermal units (Btu) per dollar, followed by Canada with an average intensity of 68,000 Btu/dollar.

The Russian and Canadian basic chemicals industries are led by fertilizers and petrochemicals. Petrochemicals and fertilizers are the most energy intensive basic chemicals, all of which rely on energy for breaking chemical bonds and affecting the recombination of molecules to create the intended chemical output. These countries produce these specific basic chemicals in part because they also produce the natural resources needed as inputs, such as potash, oil, and natural gas.

By comparison, the energy intensity of the U.S. basic chemical industry in 2015 was much lower, at 22,000 Btu/dollar, because the industry in the United States has a more diverse production mix of other basic chemicals, such as gases and synthetic fibers. However, EIA expects that increasing petrochemical development in the United States will increase the energy intensity of the U.S. basic chemicals industry.

The United States exports chemicals worldwide, with the largest flows to Mexico, Canada, and China. According to the World Input-Output Database, U.S. exports of all chemicals in 2014 were valued at $118 billion—about 6% of total U.S. exports—the highest level in decades.

Principal contributor: Elizabeth Sendich