Long stories short
- Trump was charged with deleting security camera footage of staff moving secret papers at his Mar-a-Lago mansion.
- Ukraine claimed to have gained ground in a new push south on the southern front.
- German scientists said they have revived 46,000 year-old worms in Siberia.
A month ago a Cameroonian-flagged oil tanker called the Turba docked in Yantai in northeast China and offloaded about 50,000 tonnes of heavy Russian crude. Yesterday it steamed northward through the Suez Canal. If experience is any guide in a few weeks it will turn off its transponder and reload in St Petersburg.
So what? Global oil demand and usage are higher than ever even though western oil majors’ quarterly profits have slumped, because
- the world is awash with cheap, illegally shipped oil from Russia but also Iran and Venezuela; and
- oil is an addiction humans seem determined not to shake.
In 2006 George Bush Jr said America was addicted to oil and should replace 75 per cent of its imports with ethanol and other energy sources. It hasn’t.
In 2020 BP said the world had already passed peak oil demand the previous year. Not so.
In 2021 Fatih Birol, head of the International Energy Agency, urged western oil majors to stop looking for new sources of oil and gas. They ignored him.
In 2022 and 2023 Just Stop Oil has been imploring oil users to kick the habit. They just don’t.
On the contrary. The IEA says global oil use passed its pre-pandemic peak last month at around 102 million barrels (65,000 Olympic swimming pools) per day. In June, China’s imports from Russia – all in sanctions-busting “ghost ships”, all helping to finance the war in Ukraine – reached a new record of 2.57 million barrels a day. Saudi Arabia is planning supply cuts in the next month, but only to support world prices, which in turn will boost what Russia can fetch on the grey market.
On the forecourt. Downstream, where consumers vote with their wallets on the fate of the planet, some of those who can afford to switch to cleaner transport are doing so but many aren’t. Ford announced this week it was slowing production of electric vehicles because high prices were dampening demand. Its F150 pickup (max mpg 24) remains America’s best selling vehicle. Also this week: impressed by insatiable US demand for SUVs, Toyota said it would bring back its legendary Land Cruiser two years after telling fans its time was up.
On the other hand. Looking further ahead, the IEA says world oil demand will fall steeply over the next five years, starting with a 50 per cent decline in year-on-year growth next year. It believes the trend will be driven by slackening Chinese consumption, which has more than tripled since the start of the century but failed to meet expectations since the pandemic. Russian exports, though higher than Ukraine or its allies want, fell last month to 7.3 million barrels a day, their lowest since a year before the invasion.
On present evidence. The bad ship Turba, one of a fleet of 500 ghost ships evading sanctions and the EU’s oil price cap, will go on unloading Russian oil in China, which appears to be stockpiling opportunistically against Saudi supply cuts and its own fluctuating demand. China’s CO2 emissions are currently running at around 11.5 billion tonnes a year, 33 times higher than the UK’s. As Tony Blair tells this week’s New Statesman, there’s no chance of solving climate change without China.
Meanwhile, 155 million EVs are forecast to be sold by the end of 2028 – enough, if they’re charged with green electricity, to leave 3 million barrels of oil a day in the ground. That would be 3 per cent of current global usage. A start, but not more than that.
Photograph Greg Smith/Corbis via Getty Images
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