The price of crude oil in 2012 averaged $112 a barrel, the highest yearly average in history, said Fatih Birol, chief economist at the International Energy Agency.

Iran’s deputy oil minister said that Iran’s proven crude oil and natural gas reserves are now worth around $37 trillion. The reserves include 100 billion barrels of crude oil, 94 billion barrels of condensates, and 207 billion barrels equivalent of natural gas. Iran ranks fourth worldwide with 155 billion barrels of recoverable oil reserves, after Venezuela, Saudi Arabia, and Canada. With 34 trillion cubic meters of natural gas reserves, Iran has the world’s second-largest natural gas reserves after Russia.

Russian state-owned energy firms are preparing to move into the country’s offshore polar regions. Deputy Prime Minister Dvorkovich’s told journalists that the state-controlled Rosneft and Gazprom energy companies are to receive licenses to develop the 12 and 17 arctic continental shelf sectors. The decision is raising concerns among the country’s private energy companies that they will be locked out of developing the country’s potentially vast arctic hydrocarbon reserves.

Global prices for liquefied natural gas (LNG) are rising toward record highs this year as increasing demand runs up against a stable supply, threatening to drive up fuel costs in some of the world’s biggest economies.

Wind added the most new electricity generation capacity to the US grid in 2012 according to the Federal Energy Regulatory Commission. There was 10,689 MW of new wind capacity.  Natural gas was second with 8,746 MW of new capacity,  coal third with 4,510 new MW, and solar came in fourth with 1,476 new MW. Wind accounted for 6% of US electricity generation last year.

Brazil has announced cuts in electricity rates in an effort to bring down inflation in the country. Residential consumers will pay 18% less for power, while industrial, agricultural and commercial users will see electricity bills drop 32%. Brazil’s central bank expects the electricity rate cuts to lower the consumer price index by a full percentage point by the end of 2013.

French electricity exports fell 21% in 2012, hit by competitive German electricity produced from cheap coal and renewables, German coal-fired power plants are now far more competitive with French nuclear power as coal prices have dropped worldwide as the US shifts from coal to cheaper natural gas.  US coal is now finding its way to Europe at much reduced cost for European electric utilities.

As Chinese economic growth slows down it is facing over-capacity in the electric power generation sector. China is adding power plants at a rate 77% faster than it is using them and 45% faster than growth in demand.  At current growth rates, the country’s electric power capacity could reach 1,400 GW (1.4 terrawatts) by 2020.

The European carbon price fell to a record low this week after the European Union voted not to support the struggling carbon market. The market has been plagued by an oversupply of permits due in part to over-generous initial allocations following lobbying by industry. This week the price for firms to emit a tonne of carbon fell to €2.81, a long way down from the initial price of €32.

 

With h/t Tom Whipple

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