2.14.2011
2.08.2011
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%
Source: www.guardian.co.uk
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.
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Source: www.guardian.co.uk
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.
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2.02.2011
Some 43 Million Americans Use Food Stamps
Source: Wall Street Journal, Feb 1, 2011
Nearly a year and a half into the economic recovery, some 43.6 million Americans continued to rely on food stamps in November.
More than 14% of the population drew food stamps in November to purchase groceries as high unemployment and muted wage growth crimped budgets. The number of recipients was up 0.9% from October, according to the new report by the U.S. Department of Agriculture. Compared to a year ago, the number of people receiving food stamps was up 14.2%.
In both Washington, D.C. and Mississippi more than a fifth of residents received food stamps — the highest recipiency rates of any state.
But demand has grown stronger in the past year in a handful of other states that recorded significant increases on a per capita basis.
In New Mexico, 19.4% of the population tapped into food stamps. That’s up 3.2 percentage points from the same month a year ago, the largest increase for any state. Idaho reported a similar jump: 14% of residents received food stamps, up 3.1 points from a year ago. Washington, D.C., Florida, Delaware and Texas all experienced similar year over year increases.
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Nearly a year and a half into the economic recovery, some 43.6 million Americans continued to rely on food stamps in November.
More than 14% of the population drew food stamps in November to purchase groceries as high unemployment and muted wage growth crimped budgets. The number of recipients was up 0.9% from October, according to the new report by the U.S. Department of Agriculture. Compared to a year ago, the number of people receiving food stamps was up 14.2%.
In both Washington, D.C. and Mississippi more than a fifth of residents received food stamps — the highest recipiency rates of any state.
But demand has grown stronger in the past year in a handful of other states that recorded significant increases on a per capita basis.
In New Mexico, 19.4% of the population tapped into food stamps. That’s up 3.2 percentage points from the same month a year ago, the largest increase for any state. Idaho reported a similar jump: 14% of residents received food stamps, up 3.1 points from a year ago. Washington, D.C., Florida, Delaware and Texas all experienced similar year over year increases.
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1.31.2011
New Brunswick: A banana republic*?
By Roy MacMullin
True or False? Our common heritage, the natural resources of the province, is being managed in a competent manner by the government. Recently, I looked at the money being received by the province from natural gas production. Here are the results of my investigation.
A royalty is a payment to the owner of an asset for its use. For example, if you pay rent of $900 per month on an apartment that is worth $80,000 per unit, that’s effectively a royalty of 13.5% per year that you pay for the use of that asset.
To develop a natural resource, governments often assign a block of land based on a bidding process, prospective sites are drilled by a company, connected to a pipeline and the gas produced is sold until the wells are empty. So the valid questions seem to be – First, are we getting a fair price for our non-renewable gas resource? Secondly, how fast is the resource being depleted and will there be any left for our children and grandchildren? In other words, are we using the resource in the best possible manner?
In the years from 2003 to 2010, the major producer of natural gas in New Brunswick, Corridor Resources paid royalties of between .5% and 8.2% when expressed as a percentage of natural gas revenue. The average over the period has been 5.3%. Typically, one would compare royalty regimes with other jurisdictions as a basic sanity check.
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True or False? Our common heritage, the natural resources of the province, is being managed in a competent manner by the government. Recently, I looked at the money being received by the province from natural gas production. Here are the results of my investigation.
A royalty is a payment to the owner of an asset for its use. For example, if you pay rent of $900 per month on an apartment that is worth $80,000 per unit, that’s effectively a royalty of 13.5% per year that you pay for the use of that asset.
To develop a natural resource, governments often assign a block of land based on a bidding process, prospective sites are drilled by a company, connected to a pipeline and the gas produced is sold until the wells are empty. So the valid questions seem to be – First, are we getting a fair price for our non-renewable gas resource? Secondly, how fast is the resource being depleted and will there be any left for our children and grandchildren? In other words, are we using the resource in the best possible manner?
In the years from 2003 to 2010, the major producer of natural gas in New Brunswick, Corridor Resources paid royalties of between .5% and 8.2% when expressed as a percentage of natural gas revenue. The average over the period has been 5.3%. Typically, one would compare royalty regimes with other jurisdictions as a basic sanity check.
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An era of cheap food may be drawing to a close
Source: Reuters
U.S. grain prices should stay unrelentingly high this year, according to a Reuters poll, the latest sign that the era of cheap food has come to an end.
U.S. corn, soybeans and wheat prices -- which surged by as much has 50 percent last year and hit their highest levels since mid-2008 -- will dip by at most 5 percent by the end of 2011, according to the poll of 16 analysts.
The expectations may also strengthen importers' resolve to build bigger inventories after a year in which stocks of corn and soybeans in the United States -- the world's top exporter -- dwindled to their lowest level in decades.
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U.S. grain prices should stay unrelentingly high this year, according to a Reuters poll, the latest sign that the era of cheap food has come to an end.
U.S. corn, soybeans and wheat prices -- which surged by as much has 50 percent last year and hit their highest levels since mid-2008 -- will dip by at most 5 percent by the end of 2011, according to the poll of 16 analysts.
The expectations may also strengthen importers' resolve to build bigger inventories after a year in which stocks of corn and soybeans in the United States -- the world's top exporter -- dwindled to their lowest level in decades.
More
1.24.2011
Global food system must be transformed 'on industrial revolution scale'
The existing food system fails half the people on the planet, and needs radical change if world is to feed itself, report warns
Source: www.guardian.co.uk, Monday 24 January 2011
The world will not be able to feed itself without destroying the planet unless a transformation on the scale of the industrial revolution takes place, a major government report has concluded.
The existing food system is failing half of the people on Earth, the report finds, with 1 billion going hungry, 1 billion lacking crucial vitamins and minerals from their diet and another billion "substantially overconsuming", leading to obesity epidemics. Stresses on the food system are reflected in price spikes but the cost of food will rise sharply in coming decades, the report adds, which will increase the risk of conflict and migration.
"The global food system is spectacularly bad at tackling hunger or at holding itself to account," said Lawrence Haddad, director of the Institute of Development Studies and an author of the Global Food and Farming Futures report. An expanding world population combined with the need to stop over-exploiting natural resources such as soil and water means there is a compelling case for urgent action, the report states. Food is responsible for up to 30% of global greenhouse gas emissions.
"We need to act now," said Caroline Spelman, the secretary of state for environment, food and rural affairs, whose department co-commissioned the report from the government's futures thinktank Foresight. "Farmers have to grow more food at less cost to the environment."
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Source: www.guardian.co.uk, Monday 24 January 2011
The world will not be able to feed itself without destroying the planet unless a transformation on the scale of the industrial revolution takes place, a major government report has concluded.
The existing food system is failing half of the people on Earth, the report finds, with 1 billion going hungry, 1 billion lacking crucial vitamins and minerals from their diet and another billion "substantially overconsuming", leading to obesity epidemics. Stresses on the food system are reflected in price spikes but the cost of food will rise sharply in coming decades, the report adds, which will increase the risk of conflict and migration.
"The global food system is spectacularly bad at tackling hunger or at holding itself to account," said Lawrence Haddad, director of the Institute of Development Studies and an author of the Global Food and Farming Futures report. An expanding world population combined with the need to stop over-exploiting natural resources such as soil and water means there is a compelling case for urgent action, the report states. Food is responsible for up to 30% of global greenhouse gas emissions.
"We need to act now," said Caroline Spelman, the secretary of state for environment, food and rural affairs, whose department co-commissioned the report from the government's futures thinktank Foresight. "Farmers have to grow more food at less cost to the environment."
More
1.19.2011
How sustainable is growth with triple-digit oil?
Source: Globe and Mail, January 18, 2011
Author: Jeff Rubin
With oil prices (CL-FT91.620.240.26%)within spitting distance of triple-digit levels, it may be time to reconsider just how long this recovery will run.
The fact that we’re seeing oil at triple-digit prices in this cycle should come as no surprise. After all, that’s where oil prices ended up last cycle before deep-sixing the global economy. But to see triple-digit prices again this early into what by all historical standards has been a painfully slow global recovery must be disconcerting to a world economy never hungrier for growth.
If merely getting back to pre-recession levels of global industrial production has oil knocking at the gates of triple digits, where do you think crude will be trading should we be fortunate enough to sustain this economic recovery for another year?
If anyone doubts how vital oil is to economic growth, just look at what happened last year. Global oil demand grew at two and a half per cent from the year before (almost double the International Energy Agency’s original forecast for 2010).
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Author: Jeff Rubin
With oil prices (CL-FT91.620.240.26%)within spitting distance of triple-digit levels, it may be time to reconsider just how long this recovery will run.
The fact that we’re seeing oil at triple-digit prices in this cycle should come as no surprise. After all, that’s where oil prices ended up last cycle before deep-sixing the global economy. But to see triple-digit prices again this early into what by all historical standards has been a painfully slow global recovery must be disconcerting to a world economy never hungrier for growth.
If merely getting back to pre-recession levels of global industrial production has oil knocking at the gates of triple digits, where do you think crude will be trading should we be fortunate enough to sustain this economic recovery for another year?
If anyone doubts how vital oil is to economic growth, just look at what happened last year. Global oil demand grew at two and a half per cent from the year before (almost double the International Energy Agency’s original forecast for 2010).
More
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