Ocean Heat Sets New Record, While More Than One Million Kilometers Of New Oil and Gas Wells To Be Drilled By 2023
Carbon Dioxide Levels Hit Highest Level In 3 Million Years, While Plastic Industry Plans Big Growth

Some UK Coastal Communities May Have To Move, While U.S. Crude Output To Grow in 2019 And 2020

In climate-related news:

From New Scientist:  “Some UK coastal communities may have to move because of climate change.”

Excerpts:

Some coastal communities around the UK may have to eventually be moved because of the scale of flooding that climate change threatens to bring, the Environment Agency has warned.

In a report on the UK’s long term flooding strategy, the regulator said the country should be prepared for sea level rises and the flooding that 4°C of warming would bring.

At 1°C higher than temperatures are expected to rise with governments’ climate plans today, and 2°C more than the Paris climate accord demands, the agency is saying the UK should be braced for the worst.

Flooding has been repeatedly cited by government agencies, advisers and scientists as the biggest risk to the UK from climate change.

The EA said the government will need to spend at least £1bn every year up to 2065 on flood defences to protect buildings and infrastructure, almost double the £520m it is spending each year between 2016 and 2021.

From ABC (Australia):  “Climate change could slash $571b from property values, study warns.”

Excerpts:

A Climate Council study warns the value of Australian real estate could plunge over the next decade unless future governments have the political will to deal with climate change.

Key points:

  • The Climate Council estimates Australian real estate will lose $571b, or almost 9pc, of its value by 2030
  • The losses will be concentrated amongst 5-6pc of property owners, with many properties virtually uninsurable
  • The report estimates $4 trillion could be wiped off economic growth over the next 80 years if carbon emissions do not fall

The research estimates residential property value losses of $571 billion by 2030 related to increased extreme weather events, inundation of some low-lying coastal properties and higher insurance premiums.

That would wipe approximately 9 per cent of the nation's total residential property value — about as much as has been lost so far in the current property downturn, which is on track to be the worst in Australia's recent history.

However, these losses would not be evenly spread, as an estimated 5-6 per cent of property owners bear the brunt of climate change risks.

As insurance companies reshape their risk strategies to manage extreme weather events, the report predicts, the cost of insuring properties — particularly those on the coast — could become unaffordable for one in 19 owners, who would have to pay annual premiums equivalent to 1 per cent of their property value.

A recent study by the Actuaries Institute — actuaries are the statisticians who calculate risk for insurers — warns that as many as one in 10 properties could become uninsurable by the end of this century due to climate change.

From NBC Connecticut:   “Warming Oceans Changing the Game for Connecticut Fishermen.”

Excerpts:

Our beautiful Connecticut coastline is at the forefront of climate change, warming four times faster than the global ocean. And while the gradually increasing water temperature may not be noticeable to beachgoers, to local fishermen it is changing the game.

“The amount of fish that we saw in the Long Island Sound the fish that are resident in Long Island Sound of the flounders and the different shellfish...those fish began to disappear noticeably disappear,” explained Gary Yerman, a fisherman and founder of New London Seafood Distribution.

Gary has been fishing out of Connecticut for 47 years. While his catches started in Long Island Sound, the evolving ecosystem has made trips longer and farther.

“Our trips were actually daytrips where we leave early in the morning,” Yerman said. “And we’d get back late in the evening and we download our fish and go the next day that turned into overnight fishing where would be gone for two days and then in the mid-80s when all we started seeing all of these changes and fisheries regulations changes and what not we ended up fishing in the ocean, in North Atlantic. We fish room all the way from Virginia to the Canadian line.”

Research is showing that water temperatures closest to the northeast coast are warming faster than 99 percent of global oceans. This supports the shift in the ecosystem that we’re seeing here in the northeast.

From the Wall Street Journal:  “Fed Readying Financial System for Climate-Change Shocks.”

Excerpts:

The Federal Reserve stands ready to respond to climate-change related weather disruptions to the economy and is working to ensure banks’ resilience from unexpected shocks tied to a warming global environment, Fed Chairman Jerome Powell told Congress in an April letter.

“Although addressing climate change is a responsibility that Congress has entrusted to other agencies, the Federal Reserve does use its authorities and tools to prepare financial institutions for severe weather events,” Mr. Powell wrote in a letter to Sen. Brian Schatz (D., Hawaii), on April 18.

“Over the short term, these events have the potential to inflict serious damage on the lives of individuals and families, devastate local economies (including financial institutions), and even temporarily affect national economic output and employment,” Mr. Powell wrote. “As such, these events may affect economic conditions, which we take into account in our assessment of the outlook for the economy,” the central bank leader said.

From New Food Economy:  “Massive banana disease, worsened by climate change, threatens global crops.”

Excerpts:

You may have heard that virtually all bananas we eat are from the genetically identical Cavendish cultivar. You’ve also likely heard about a big, scary disease called Fusarium Wilt (also known as Panama Disease) that evolved to threaten the previously resistant Cavendish. (Panama Disease basically knocked out the last great banana cultivar, the Gros Michel—French for “Big Mike!”)

But there’s another, less dramatic disease that actually causes larger global yield losses than Fusarium Wilt. It’s called Black Sigatoka or Black Leaf Streak disease, and climate change has increased its risk by 44 percent since the 1970s, according to a new study by researchers at the University of Exeter.

Unlike Fusarium Wilt, Black Sigatoka does not kill off entire banana farms. Rather, it affects the plant’s leaves, which can in turn interrupt the fruit ripening process and depress yield by up to 80 percent, according to the study.

The fungus that causes Black Sigatoka thrives on wet leaves and in temperatures that hover around 80 degrees Fahrenheit. The researchers found that climate change has bred precisely these conditions in many banana-growing regions in Latin America. They came to these conclusions by cross-referencing experimental data on Black Sigatoka infections with 60 years of climate data. “I was surprised by the strong climate change signal in the data, for Latin America,” researcher Dan Bebber wrote in an email. “Conditions have definitely improved for the fungus across large areas.”

...

Meanwhile, in business-as-usual news:

From Reuters:  “EIA raises forecast for 2019, 2020 U.S. crude output growth.”

Excerpts:

U.S. crude oil production is expected to rise by 1.49 million barrels per day (bpd) in 2019 to average 12.45 million bpd, the U.S. Energy Information Administration (EIA) said on Tuesday, up from its previous forecast for a rise of 1.43 million bpd.

The EIA forecast output in 2020 will rise by 930,000 bpd to 13.38 million bpd, a bigger increase than it previously estimated.

The latest forecast puts the United States on track to reach the 13-million-bpd milestone in the fourth quarter of 2019.

The United States has overtaken Saudi Arabia and Russia to become the world’s biggest oil producer, thanks to a shale revolution.

“According to the May outlook, EIA still expects that the United States will begin exporting more petroleum and other liquids than it imports in the fourth quarter of 2019, continuing for the foreseeable future,” EIA Administrator Linda Capuano said in an email. “The shift toward becoming a net petroleum and other liquids exporter marks a first for the United States since 1948,” Capuano said.

From Rolling Stone:  “Study: U.S. Fossil Fuel Subsidies Exceed Pentagon Spending.”

Excerpts:

The United States has spent more subsidizing fossil fuels in recent years than it has on defense spending, according to a new report from the International Monetary Fund.

The IMF found that direct and indirect subsidies for coal, oil and gas in the U.S. reached $649 billion in 2015. Pentagon spending that same year was $599 billion.

The study defines “subsidy” very broadly, as many economists do. It accounts for the “differences between actual consumer fuel prices and how much consumers would pay if prices fully reflected supply costs plus the taxes needed to reflect environmental costs” and other damage, including premature deaths from air pollution.

These subsidies are largely invisible to the public, and don’t appear in national budgets. But according the the IMF, the world spent $4.7 trillion — or 6.3 percent of global GDP — in 2015 to subsidize fossil fuel use, a figure it estimated rose to $5.2 trillion in 2017. China, which is heavily reliant on coal and has major air-pollution problems, was the largest subsidizer by far, at $1.4 trillion in 2015. But the U.S. ranked second in the world.

The human, environmental and economic toll of these subsidies is shocking to the conscience. The authors found that if fossil fuels had been fairly priced in 2015, global carbon emissions would have been slashed by 28 percent. Deaths from fossil fuel-linked air pollution would have dropped by nearly half.

Oil, gas and coal companies — and their stooges in public office — have long argued that making consumers pay for the full impacts of fossil fuel use would cripple the economy. The IMF experts call bullshit on this idea, revealing that the world would, in fact, be more prosperous. Eliminating subsidies for fossil fuels would have created global “net economic welfare gains” in 2015 of “more than $1.3 trillion, or 1.7 percent of global GDP,” the study found. (These net gains are “calculated as the benefits from reduced environmental damage and higher revenue minus the losses from consumers facing higher energy prices.”)

For the United States, the $649 billion in fossil fuel subsidies exceeded even the extravagant amount of money the country spent on defense. To offer a sense of scale, Pentagon spending accounted for 54 percent of the discretionary federal budget in 2015. In comparison to another important, but less well-funded part of the federal budget, fossil fuel subsidies were nearly 10 times what Congress spent on education. Broken down to an individual level, fossil fuel subsidies cost every man, woman and child in the United States $2,028 that year.

From The Barents Observer:  “Arсtic oil field could be Russia’s biggest discovery in 30 years.”

Excerpts:

A major oil development project could soon unfold in the Yenisey River delta. Near the area where the great Russian river runs into the Kara Sea are vast oil resources stored under the local permafrost.

Russia’s state mineral extraction agency Rosnedra now confirms that the resource estimates of the Paykha fields amount to as much as 1,2 billion tons, newspaper Kommersant reports.

That is one of the biggest estimates ever made for a Russian oil field.

The sudden upgrade of the fields comes as the Russian government is hectically struggling to add shipment volumes to the Northern Sea Route. President Vladimir Putin has requested a boost in Arctic shipping to an annual of 80 million tons by year 2024 and new infrastructure and industry is planned built to meet the ambitious target.

The Payakha fields could become a key part of the picture.

Previously, it was believed that the field by 2024 could provide up to five million tons to the Northern Sea Route. That estimate might now be increased.

Furthermore, the Payakha resources could become a crucial component in the new Arctic oil pipeline planned by Rosneft. The state oil company says it intends to build a 600 km long pipeline from the Vankor fields in western Siberia to the coast of the Taymyr Peninsula. It will have the capacity to carry 25 million tons per year and could potentially include also the Payakha resources.

From Oilprice.com:  “There’s Tremendous Room For Growth In Offshore Oil & Gas.”

Excerpts:

The Offshore Technology Conference (OTC) in Houston, Texas celebrates its 50th birthday this week, begging the question – what will the next 50 years hold for the offshore market?

Luckily, the data can provide some clues. Rystad Energy has analyzed the historic investments and oilfield service purchases of the world’s 50,000 oil and gas fields (1). While the forecast is uncertain, our analysis paints a fascinating picture of how offshore could contribute to the future of the service industry.

“Total greenfield project sanctioning, summed up to the present day, only accounts for 40% of estimated volumes of offshore projects ever being sanctioned. Likewise, the brownfield market has only begun, with total historical expenditures accounting for only about 20% of estimated brownfield spend over the projects lifetime, leaving 80% of brownfield spending to the future. And the decommissioning market is still in its nascent form,” says Audun Martinsen, head of oilfield services research at Rystad Energy.

Let’s drill down through the data.

We estimate that around 800 billion undiscovered barrels of oil and gas equivalents exist globally, hinting that exploration will still be in business in the next 50 years.

From S&P Global Platts:  “China's Apr crude oil imports rebound to record high 10.68 mil b/d.”

Excerpts:

China's crude oil imports in April hit a record high of 10.68 million b/d, rebounding from 9.3 million b/d in March, preliminary data from the General Administration of Customs showed Wednesday.

On a barrels per day basis, the volume represented a 14.9% month-on-month jump, and rose 10.8% from April 2018.

The previous record high was 10.48 million b/d in November 2018 and the country's crude imports were hovering above 10 million b/d for four months until March, when the volume fell to 9.3 million b/d.

From Rigzone:  “Most US Offshore Resources Not Up for Grabs.”

Excerpts:

Ninety-four percent of the United States’ offshore resources are not available for investment.

That’s what Eric Oswald, vice president for the Americas at ExxonMobil, revealed during a presentation at the Offshore Technology Conference in Houston, Texas, on Wednesday.

“You guys know how much of the U.S. offshore is available for investment? … Six percent. Ninety-four percent of our nation’s resources offshore … are not available for us to invest in,” Oswald told delegates attending the presentation.

“Who’s losing there? I mean it’s the country, right? It’s a huge amount of potential lost there … That’s an astonishing number,” he added.

From the Wall Street Journal:  “Flying Coast-to-Coast Nonstop Has Rarely Been Cheaper.”

Excerpts:

From Los Angeles, a flight to New York is sometimes cheaper these days than a flight to Chicago, even though it’s 2½ hours longer. From Boston, you can fly 2,611 miles to Los Angeles cheaper than 91 miles to Nantucket.

Flying coast-to-coast nonstop has rarely been cheaper. Airlines are embroiled in a fare war, with the number of seats on transcontinental routes at an all-time high. Between Los Angeles and either New York or Boston, several airlines have $317 round-trip fares on June travel dates. Some tickets drop as low as $295 round trip. That’s in peak summer season.

United, Delta, American, JetBlue and Alaska are battling for market share, mostly from California cities to New York. The fight isn’t just in the coach cabin: They’re offering deep discounts in premium cabins, too.

Up front, four of the five big carriers offer lie-flat beds, and those seats sometimes go for as low as $1,200 round trip. The same seat to London from New York—a route a bit longer than New York-Los Angeles—could cost at least five times as much.

“It’s far more competitive today than it was five years ago and 10 years ago,” says Andrew Nocella, United’s chief commercial officer.

Coast-to-coast routes are some of the most heavily traveled in the world, attracting premium cabins full of investment bankers, media executives and celebrities. These routes are key to winning contracts from big corporations and loyalty from frequent fliers.

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