Oil geopolitics in Central Asia & the Caucasus

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South Caucasus

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Central Asia

Here is a America Abroad Media program on oil politics in former USSR republics. The program notes the tug-of-war between Western nations (NATO) and China & Russia (Shanghai Cooperation Organisation) for the region's oil & gas resources.

Baku-Tbilisi-Ceyhan and other pipelines. Credit: Wikipedia

Historically, this region had Russian, Persian, Turkish, and Chinese political, cultural and social influences. As one of the commentators alluded to, this is a fight for the control of the center of the oil & gas-rich Eurasian landmass. As they say in chess, it is all about controlling the center.

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Sinking ship? Shell exec thinks not....

Here is a link to a NPR interview with Shell Oil Company president Steve Inskeep. I am interested in the matter-of-fact manner in which CEOs and top management of both oil and utility companies imply that we as a society have to start using cleaner energy sources. I tend to agree with Mr. Inskeep that displacing millions of barrels of oil/day of imports has both of balance-of-trade, and national security implications, but do not know whether offshore drilling is the only way to achieve these goals.

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Oil Roundup : 09/11/08

(Disclaimer: This article has no information related to September 9/11 attacks. I plan to do these "oil roundups" more frequently, and the timing was merely coincidental.)

Oil today closed at ~101 $/bbl, down from its July highs of 147 $/bbl. Meanwhile, gas prices in the gulf coast are rising, in anticipation of Hurricane Ike's landfall later this week. More from the AP's Money Minute


In related news, Petroleo Brasileiro (PBR) also reported a significant offshore medium crude-oilfield discovery, sending the prices of its shares up 6% (on the US markets) while oil was falling. A study by Masters Capital Management found that oil prices were indeed linked to speculation by large financial investors. I do not find anything wrong in speculation; some risk-taking is always good for the markets. However, I will read the report in greater detail to find whether they uncovered evidence for market manipulation.

Summing up, although crude prices seem to be falling because of institutional investors/stronger dollar/weakening oil demand, analysts believe that market fundamentals indicate an upward trend in oil prices.

Previous articles by Nari on price speculation:

• Opinion: Oil Prices Depend on More on Speculation than assumed previously
• Speculation in Crude Oil, Middle men and prices

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Analysis: How much energy can be realized from waste-to-fuel conversion processes?

This post was motivated by a discussion at Big Biofuels Blog. The question was what impact would these waste-fuel processes make on crude oil imports/consumption.

Assuming that 30% of petrochemical product-containing waste is collected for conversion to fuels, and a 15% waste to fuels conversion energy efficiency, I estimate that ~0.3% of current US crude oil consumption can be met with waste-fuels conversion. Here is a link (Nature Network) for further discussion . Details of the calculation after the jump.

Current US oil consumption: ~20 million bbl/d
10% of our crude oil use goes towards making petrochemicals. If we assume that 70% of the energy is lost, 1.4 million bbl/d of oil equivalents of energy is still left for us produce fuels (if we do not count the energy that is input while making the petrochemicals). If we use 30% of this waste to make fuel, and assume a (conservative) 15% efficiency for the waste-fuel conversion, we can get 1.4*0.3*0.15 = 0.063 million bbl/d. (or 0.32% of current US crude oil consumption).
To put this in context, transportation accounts for 70% of the current crude oil consumption.

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Analysis: How much biodiesel will jatropha cultivation in UP produce?

UP (a large Indian state with the highest population) is planning to cultivate jatropha in 1.586 million hectares (3.91 million acres) of wasteland. Both the Business Standard and the GCC do not mention how much of India's current fuel/diesel demand can be met by this move. My back-of-the-envelope calculations indicate that a significant portion (~23%) of India's diesel product imports can be displaced by cultivating jatropha in the 1.6 million ha.


From the Green Car Congress blog:

Indian State of Uttar Pradesh to Cultivate jatropha on 40% of Wasteland
16 August 2008
Business Standard. The Indian state of Uttar Pradesh (UP) has set a target to bring at least 40% of its wasteland under jatropha cultivation for biodiesel feedstock within the coming five years.

• The average yield of jatropha is ~1-5 tonnes/ha(from a somewhat dated Frost & Sullivan report on biodiesel). Assuming crude jatropha oil yield of ~2.5-3 tonnes/ha (see above report), UP would produce ~4 million tonnes of crude (jatropha) oil/ha for every crop of jatropha. According to an article in the MIT technology review, 1 hectare of jatropha produces ~1900 liters of "fuel". Therefore, 1.6 million ha. will produce 3040 million liters (800 million US gallons) of fuel for each crop of jatropha (The actual production per year will depend on the number of crops that can be cultivated per year).
• In an other paper, Francis et al. assume a yield of ~580 l biodiesel/ha/year from jatropha cultivation in India. UP would therefore generate ~243 million US gallons of fuel/year (900 million liters of biodiesel/yr).
  
• What does 240 million US gallons/yr of biodiesel mean ? On a mass basis, it is approximately 0.8 million tonnes of biodiesel/yr. Since the calorific value of petroleum diesel is ~15% higher than that of biodiesel, 0.8 million tonnes of biodiesel would be equivalent to 0.7 million T of petroleum diesel.
  
• India's diesel "product" imports during 2007-08 were 2.93 million T. (This does not include diesel made from imported crude oil). Therefore, cultivating jatropha in 1.6 million ha. (approximately equivalent to the area of the state of Nagaland or eleven times the area of (the state of) Delhi) will potentially displace ~23% of Indian diesel product imports.
  

Resources:
A report on jatropha cultivation in Cambodia, but also has India-specific data.

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