Connect with us

Energy

A Crude Problem For Putin’s Russia

Published

on

Russian History and Oil Prices

A Crude Problem For Putin’s Russia

Western sanctions against Russia that stemmed from the events in Ukraine have not yet put a significant dent in the country’s economy or changed their plans abroad. However, over the last three months, the slumping price of crude oil may be the factor that finally makes Moscow blink.

While Brent oil has traded throughout the year at around $110/bbl, it is only recently that the price has dropped to closer to $85. A combination of items have contributed to crude’s steep drop including a stronger US dollar, slowed economic growth in Europe and China, and increased US shale oil and gas production.

Some countries benefit from having oil as a cheaper input, but Russia is not one of them. Russia is the second largest exporter of oil selling 7.2 million bpd in global markets, which equates to about 45% of Russia’s budget revenues. Deutche Bank has calculated the breakeven price for Russia’s fiscal situation at an oil price at $102/bbl.

Oil prices and deficits for selected countries including Russia

The impact of this is already showing up in the Kremlin’s finances. Not only does Russia forgo extra revenue towards its budget, but it also hurts the exchange rate of the country’s currency. So far this month, Russia has spent upwards of $7 billion propping up the rouble, which is trading at record lows.

A previous crash in oil prices in the 1980s was at least partly responsible for bankrupting the Soviet Union, and this time the stakes could also be high. Putin’s support will stay high as long as business is good and the country keeps its pro-Russia stance. However, it remains to be seen what kind of pressure that a more long-term low oil environment will put on Putin and his administration.

Opening graphic from: RadioFreeEurope

Recommended Posts

btc vs banking feature  iot fg

Continue Reading
Comments

Automotive

The Evolution of Hydrogen: From the Big Bang to Fuel Cells

Hydrogen and fuel cell technology harnesses the power of the universe to bring clean energy on Earth. Here is its potential.

Published

on

It all started with a bang…the big bang!

The explosive power of hydrogen fueled a chain reaction that led to the world we have today.

Now this power is being deployed on Earth to supply the energy needs of tomorrow.

Visualizing the Power of Hydrogen

Today’s infographic comes to us from the Canadian Hydrogen and Fuel Cell Association, and it outlines how hydrogen and fuel cell technology is harnessing the power of the universe to potentially fuel an energy revolution.

The Evolution of Hydrogen: From the Big Bang to Fuel Cells

What is Hydrogen, and How’s it Used?

With one proton and one electron, hydrogen sits at the very beginning of the periodic table.

Despite hydrogen being the most common molecule in the universe, it is rarely found in its elemental state here on Earth. In fact, almost all hydrogen on the planet is bonded to other elements and can only be released via chemical processes such as steam reforming or electrolysis.

There are five ways hydrogen is being used today:

  1. Building heat and power
  2. Energy storage and power generation
  3. Transportation
  4. Industry energy
  5. Industry feedstock

However, what really unleashes the power of hydrogen is fuel cell technology. A fuel cell converts the chemical power of hydrogen into electrical power.

Hydrogen Unleashed: The Fuel Cell

In the early 1960’s, NASA first deployed fuel cells to power the electrical components of the Gemini and Apollo space capsules. Since then, this technology has been deployed in everything from the vehicle you drive, the train you take, and how your favorite products are delivered to your doorstep.

Nations around the world are committing to build hydrogen fueling stations to meet the growth in adoption of fuel cell technology for transportation.

Hydrogen: A Green Energy Solution

Hydrogen fuel and fuel cell technology delivers green solutions in seven ways.

  1. Decarbonizing industrial energy use
  2. Acting as a buffer to increase energy system resilience
  3. Enabling large-scale renewable energy integration and power generation
  4. Decarbonizing transportation
  5. Decarbonizing building heat and power
  6. Distribution energy across sectors and regions
  7. Providing clean feedstock for industry

According to a recent report by McKinsey, hydrogen and fuel cell technology has the potential to remove six gigatons of carbon dioxide emissions and employ more than 30 million people by 2050, all while creating a $2.5-trillion market.

This is technology that can be deployed today, with the potential to transform how we live and power our economies in a sustainable way.

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading

Energy

Map: The Countries With the Most Oil Reserves

See the countries with the most oil reserves on this map, which resizes each country based on how many barrels of oil are contained in its borders.

Published

on

Map: The Countries With the Most Oil Reserves

There’s little doubt that renewable energy sources will play a strategic role in powering the global economy of the future.

But for now, crude oil is still the undisputed heavyweight champion of the energy world.

In 2018, we consumed more oil than any prior year in history – about 99.3 million barrels per day on a global basis. This number is projected to rise again in 2019 to 100.8 million barrels per day.

The Most Oil Reserves by Country

Given that oil will continue to be dominant in the energy mix for the short and medium term, which countries hold the most oil reserves?

Today’s map comes from HowMuch.net and it uses data from the CIA World Factbook to resize countries based on the amount of oil reserves they hold.

Here’s the data for the top 15 countries below:

RankCountryOil Reserves (Barrels)
#1🇻🇪 Venezuela300.9 billion
#2🇸🇦 Saudi Arabia266.5 billion
#3🇨🇦 Canada169.7 billion
#4🇮🇷 Iran158.4 billion
#5🇮🇶 Iraq142.5 billion
#6🇰🇼 Kuwait101.5 billion
#7🇦🇪 United Arab Emirates97.8 billion
#8🇷🇺 Russia80.0 billion
#9🇱🇾 Libya48.4 billion
#10🇳🇬 Nigeria37.1 billion
#11🇺🇸 United States36.5 billion
#12🇰🇿 Kazakhstan30.0 billion
#13🇨🇳 China25.6 billion
#14🇶🇦 Qatar25.2 billion
#15🇧🇷 Brazil12.7 billion

Venezuela tops the list with 300.9 billion barrels of oil in reserve – but even this vast wealth in natural resources has not been enough to save the country from its recent economic and humanitarian crisis.

Saudi Arabia, a country known for its oil dominance, takes the #2 spot with 266.5 billion barrels of oil. Meanwhile, Canada and the U.S. are found at the #3 (169.7 billion bbls) and the #11 (36.5 billion bbls) spots respectively.

The Cost of Production

While having an endowment of billions of barrels of oil within your borders can be a strategic gift from mother nature, it’s worth mentioning that reserves are just one factor in assessing the potential value of this crucial resource.

In Saudi Arabia, for example, the production cost of oil is roughly $3.00 per barrel, which makes black gold strategic to produce at almost any possible price.

Other countries are not so lucky:

CountryProduction cost (bbl)Total cost (bbl)*
🇬🇧 United Kingdom$17.36$44.33
🇧🇷 Brazil$9.45$34.99
🇳🇬 Nigeria$8.81$28.99
🇻🇪 Venezuela$7.94$27.62
🇨🇦 Canada$11.56$26.64
🇺🇸 U.S. shale$5.85$23.35
🇳🇴 Norway$4.24$21.31
🇺🇸 U.S. non-shale$5.15$20.99
🇮🇩 Indonesia$6.87$19.71
🇷🇺 Russia$2.98$19.21
🇮🇶 Iraq$2.16$10.57
🇮🇷 Iran$1.94$9.09
🇸🇦 Saudi Arabia$3.00$8.98
*Total cost (bbl) includes production cost (also shown), capital spending, gross taxes, and admin/transport costs.

Even if a country is blessed with some of the most oil reserves in the world, it may not be able to produce and sell that oil to maximize the potential benefit.

Countries like Canada and Venezuela are hindered by geology – in these places, the majority of oil is extra heavy crude or bitumen (oil sands), and these types of oil are simply more difficult and costly to extract.

In other places, obstacles are are self-imposed. In some countries, like Brazil and the U.S., there are higher taxes on oil production, which raises the total cost per barrel.

Subscribe to Visual Capitalist

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Continue Reading
The Green Organic Dutchman Company Spotlight

Subscribe

Join the 100,000+ subscribers who receive our daily email

Thank you!
Given email address is already subscribed, thank you!
Please provide a valid email address.
Please complete the CAPTCHA.
Oops. Something went wrong. Please try again later.

Popular