U.S. President Barack Obama announced Wednesday what he called an ‘historic’ climate change agreement with Chinese President Xi Jinping that would cut both countries' greenhouse gas emissions by close to a third over the next two decades. This was considered by some to be a face-saving deal at the APEC trade summit in China. Under the deal, the United States would agree to cut its carbon emissions between 26 to 28% from levels established in 2005 by 2025, which the White House says is achievable. China would get more leeway and agreed it would peak its carbon emissions no later than 2030, but would also increase the use of non-fossil fuels to 20% by 2030.
Of course, instead of engaging potential critics about the merits of the deal, the White House decided to insult them instead. This is always a good thing to do when you are trying to win someone over to your point of view. Instead of saying that the White House was ready to engage the new Congress on the deal for the good of the country, the White House instead inferred that “leading climate deniers" in the Republican Party may try to spoil the President’s agreement, and that no matter what they thought about it inferred that the President would act alone if necessary.
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The White House, in their infinite knowledge, will argue that they have the moral authority to act because they say that global warming is a “settled science.” They will point out that most scientists agree that the globe is warming, the same way that three out of 4 dentists recommend Crest toothpaste and that 3 out of four choosey mothers choose Jiff.
Of course if you go back to Science 101, I thought that science was never really settled. That there were always reasons to continue to question the status quo of conventional thought. I thought a scientist was supposed to ask questions. Say, like, why every major dooms day prediction those scientists made about global warming has not happened? Even the Intergovernmental Panel On Climate Change (IPCC), who said that they were 95% percent sure that global warming was happening and caused by man, confirmed there has been a “hiatus” in global warming for at least the last 15 years. Or the fact that scientists predicted that the Arctic would be ice free by 2013, but instead that 533,000 more square miles of ocean covered with ice than at the same time last year – an increase of 29%.
The rebound from 2012’s record low comes six years after the BBC reported that global warming would leave the Arctic ice-free in the summer by 2013. Maybe the real climate deniers are the ones that fail to acknowledge that so far the so-called science has been wrong. Maybe that the scientists that were so sure about the science and can agree with 95% percent certainty that global warming is caused by man- made sources can’t agree on why they have been so right on the cause but so wrong on the effect. Maybe they should ask why some scientists tried to manipulate and hide data that would call into question the righteousness of the scientific cause.
From an economic standpoint the deal calls on more comic pain on the U.S. than China, despite the fact that China is a much bigger polluter. Not to mention the fact that according to a report by the International Energy Agency, China will overtake the U.S. as the world’s biggest oil consumer in two decades.
Russia, on the other hand, is cutting natural gas deals with China that will give them billions of dollars while we here in the U.S. are cutting deals that will cost us billions. President Obama is one shrewd negotiator. Obama said he hopes the announcement will spur other nations to tackle climate change and if they do I hope they let the President negotiate the deal.
If the deal is done it will reduce long-term demand prospects for oil and coal and may make some investment in energy development be put on hold, which may be a mistake if you get the warning from the International Energy Agency in its “World Energy Outlook” report today. They warn not to take the current oversupply of oil for granted. They say that U.S. shale production may be masking the world’s growing need for oil and gas. The IEA says that the “U.S. shale boom masks threats to global oil supply including Middle East turmoil, conflict in Ukraine and the difficulty of unconventional oil production beyond North America. The IEA warns the global energy system is in danger of falling short of the hopes and expectations placed upon it,” the IEA said.
“The short-term picture of a well-supplied oil market should not disguise the challenges that lie ahead as reliance grows on a relatively small number of producers,” they said. They warn that the U.S. production of “tight oil” from shale deposits will plateau in the next 10 years and eventually fall.
They also say that global oil demand will rise 16% to 104 million barrels a day in 2040, compared with 90 million last year, the Paris-based adviser to industrialized nations said. The pace of demand growth will slow to 1% a year from 2025, after climbing more than 2% annually in the last two decades, developing nations of Asia will account for 60% of total demand growth in the said period. Oil use will probably decline in members of the Organization for Economic Cooperation and Development, which includes the U.S., Germany and Japan. “For each barrel of oil no longer used in OECD countries, two barrels more are used in the non-OECD counties.”
Global Warming was the biggest concern of my commute friends Tuesday as we were waiting for the train in a 16 degree wind chill factor, but was not on the minds of natural gas traders. Natural gas climbed back from a “sell the fact” selloff only to await to see how strong the demand will be over the next week. The Injection this week will be 40bcf’s, but next week we should see our first withdraw! Winter then will be officially here.
Midwest cash markets for gas and products eased as supply is starting to catch up. Oil is still under pressure as supply is still ample. From the demand side Michael Sivak, Ph.D. who is Director, Sustainable Worldwide Transportation at the University of Michigan Transportation Research Institute reported that “the average fuel economy (window-sticker value) of new vehicles sold in the U.S. in October was 25.3 mpg—unchanged from the value in September. The unchanged average fuel economy is likely a net consequence of two opposing trends: less demand for fuel efficient vehicles because of the decreasing price of gasoline, and improved fuel economy of 2015 model year vehicles compared to 2014 model year vehicles. Vehicle fuel economy is up 5.2 mpg since October 2007 (the first month of our monitoring). The University of Michigan Eco-Driving Index (EDI)—an index that estimates the average monthly emissions of greenhouse gases generated by an individual U.S. driver—reached a record low of 0.76 in August (the lower the value the better). This value indicates that the average new-vehicle driver produced 24% lower emissions in August than in October 2007. The EDI takes into account both vehicle fuel economy and distance driven (the latter relying on data that are published with a two-month lag).
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