Mother Nature Sends Oil Sector Strong Message
This article was written by Oilprice.com -- the leading provider of energy news in the world
British Prime Minister David Cameron said he suspected the recent extreme winter weather may be a result of climate change, something the World Meteorological Organization said last year was tied to fossil fuels. Mother Nature may be sending a message then as ConocoPhillips blamed weather for a slump in recent oil and gas production.
Heavy rains and flooding are creating headaches for Britons. Cameron during his weekly appearance before the House of Commons warned of more extreme weather on the way and called on his constituents to be on alert.
"Colleagues across the House can argue about whether [the recent weather] is linked to climate change or not," the prime minister said. "I very much suspect that it is."
Last year, the WMO said high levels of greenhouse gases in the atmosphere, a primary driver of climate change, was the result of the burning of fossil fuels. The International Energy Agency, meanwhile, warned that although renewable forms of energy are making headway, the global economy still relies on fossil fuels as its dominant source of energy.
The rough start to the winter season left no quarter for even those with the deepest pockets. ConocoPhillips, a supermajor with headquarters in Houston, said its fourth quarter production was negatively affected by the extreme weather in the North Sea region and the United States, still reeling from a frigid arctic system.
A meteorological phenomenon known as the polar vortex dumped several inches of snow across much of the Midwest and left states as far south as Georgia with historically low temperatures. The deep freeze slowed road travel and closed production facilities.
Conoco said fourth quarter production was around 1.48 million barrels of oil equivalent, down slightly from its previous forecast of as high as 1.52 million boed, because of the extreme weather.
For natural gas, the story was just as dramatic. PJM Interconnection, which operates the grid for more than 61 million Americans, called on consumers to conserve energy during the arctic blast, saying its natural-gas fired plants were affected by the cold.
For the renewable energy sector, however, the strong winds that accompanied the frigid air were a blessing for communities struggling to keep the lights on. Texas, which saw below-freezing temperatures early this week, declared a power emergency but credited wind power with provided a much-needed buffer.
Climate researchers say the burning of fossil fuels, even low-carbon natural gas, is adding more CO2 to the atmosphere. Rising levels of those greenhouse gasses could explain some of the extreme weather. Last year, the WMO and international delegates warned time was running out to add more diversity to an energy mix creating some of the problem. With much of the U.S. Midwest reveling because of single-digit temperatures, it may be Mother Nature calling the shots on energy diversity.
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Related article: Are We Falling Off the Climate Precipice?
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Written by Daniel J. Graeber at Oilprice.com
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