By Paul Homewood
The BP Energy Review came out while I was on holiday, and I have now had a chance to look at it.
To some extent, last year was a mixed bag. In 2020, of course, energy consumption plummeted during lockdown. However, the world was still struggling to get back to normal economic levels in 2021.
It seems an age ago, but in the UK for instance we were still in semi lockdown until May. Most of Europe and the US were slower still in recovery. As a result, energy consumption, while higher than 2020, was still not back to 2019 levels in most of the world outside of China:
Unsurprisingly, we see a similar pattern in CO2 emissions:
We won’t get a clearer picture till next year, but what we can see is that emissions in China and India show no signs of abating.
A couple more charts.
Wind and solar power continue to contribute tiny amounts of the world’s energy.
The second chart neatly encapsulates why oil prices have been rocketing in the past year:
Oil production fell away during 2020, partly because of lockdowns and partly because of the rock bottom prices triggered by those lockdowns. However it has been slow to get back to pre-pandemic levels, while demand has been increasing again. Indeed US production in 2021 is actually slightly less than in 2020.
It also needs to be noted that oil consumption has been increasing by 1% a year, for the decade up to 2019. Oil prices will remain high until production returns to 2019 levels and more.
Finally, let’s deal with the Russia factor. The numbers show that Russia produced more oil last year than in 2020, so we cannot blame last year’s prices rises on Putin, as Joe Biden wants to. I suspect when we see the figures for this year, they will confirm the suspicion that Russia has maintained output levels, and is simply exporting more to China and India to counter the western embargo.
The natural gas data makes interesting reading.
Globally, output has already returned to 2019 levels.
Whilst Russian has cut its exports to Europe by 13% from 2019 levels, its output has actually risen since 2019.
The difference has been made up partly by increased exports outside of Europe, mainly China, and reduced imports from CIS states.
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July 18, 2022