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CFR Presents

Energy, Security, and Climate

CFR experts examine the science and foreign policy surrounding climate change, energy, and nuclear security.

Five Things I Learned About the Oil Price Crash

by Michael Levi Tuesday, February 24, 2015
Oil Price Crash 2015

The Council on Foreign Relations hosted a symposium yesterday on the causes and consequences of the oil price crash. Our three panels tackled the reasons for the crash and the future of oil prices; the economic fallout from the crash in the United States and around the world; and the geopolitical consequences of the oil price crash, both to date and going forward. (These links will take you to video of each session.) I trust that everyone took distinct conclusions away from the day. Here are five things I learned or hadn’t properly appreciated before: Read more »

A Must Read New Book on Oil, Finance, and Economic History

by Michael Levi Thursday, February 12, 2015
Market Madness

In 1863, with the first American oil boom “at full tilt”, Andrew Carnegie had an epiphany: the world would soon run out of oil. He and a partner “decided to dig an enormous hole, capable of holding 100,000 barrels of oil”, where they would stockpile crude “until the worldwide oil shortage had struck”. When that happened, they’d be rich – to be precise, they’d be millionaires. Read more »

The Oil Lesson of 1986 is Wrong

by Michael Levi Thursday, January 15, 2015
BloombergOil1986

When I was on the road promoting The Power Surge in 2013, I regularly said two things: First, oil prices could easily plunge for a year or two, though it was far from certain that that would happen. Second, we would not see a repeat of 1986, when the hangover from a price crash lasted for well over a decade before high prices finally returned. Read more »

One More Reason to Raise the Gas Tax Now

by Michael Levi Friday, January 9, 2015
Gasoline price gas tax 2015 REUTERS/Rick Wilking

Three months ago gas taxes were untouchable. Now, with oil prices down, they’re having a moment. Public voices from Larry Summers to Charles Krauthammer are calling for hikes. (Summers argues for a carbon tax; Krauthammer says the tax should be raised “a lot”.) More important, serious lawmakers from both sides of the aisle have gotten in on the game. The general thrust of the arguments on offer is that with oil prices falling, it’s now possible to raise the gas tax and still leave consumers better off than they were half a year ago. That right, but I think there’s an even stronger argument to be made. Read more »

What Low Oil Prices Mean for the Keystone XL Pipeline

by Michael Levi Wednesday, January 7, 2015
Keystone XL Pipeline Reuters/Andrew Cullen

The 114th Congress is in session and the Keystone XL pipeline is at the top of its docket. Senate Republicans have vowed to push the pipeline through and President Obama has threatened to veto any bill that does that. After five years of battle, this is mostly more of the same. But one thing about the world has changed radically since the Keystone XL pipeline became a top tier issue: oil prices have plunged. So what do lower oil prices mean for the costs and benefits of the Keystone XL pipeline? Read more »

Oil and OPEC: This Time is Not as Different as You Think It Is

by Michael Levi Monday, December 1, 2014

The plunge in oil prices late last week, following an OPEC announcement that its members won’t cut their oil production now, has analysts scrambling to outdo each other with hyperbole. It is a “new era” for oil as OPEC has “thrown in the towel”. We are now in a “new world of oil” as the “sun sets on OPEC dominance”. Read more »

What the Big U.S.-China Climate Announcement Means

by Michael Levi Wednesday, November 12, 2014
REUTERS/Carlos Barria REUTERS/Carlos Barria

Barack Obama and Xi Jinping surprised even the closest climate watchers last night when they jointly announced new emissions-cutting goals for the United States and China. This is a serious diplomatic breakthrough after years of unsuccessful efforts to do something big and joint that goes beyond clean energy cooperation and gets to one of the most sensitive parts of climate policy. What it ultimately means for emissions, of course, will be determined over many years. Read more »

Booming Coal Use Isn’t Just About China – It’s Increasingly About India Too

by Michael Levi Monday, November 10, 2014
Reuters/Hannibal Reuters/Hannibal

Coal has been the world’s fastest growing energy source for a decade. That’s largely been driven by China. Increasingly, though, it’s about India too, which has important climate implications.

The chart below shows annual changes in global oil, gas, and coal consumption. (The figure for a given year is the change from the previous year; all numbers in this post are based on the BP Statistical Review of World Energy 2014.) Between 1988 and 2002 coal led the pack only once. But between 2003 and 2013, coal led in every year but 2008. Read more »