A dramatic build-up in China’s strategic petroleum reserve and surging demand for imported crude oil are likely to transform the global energy markets this year, regardless of any production freeze agreed by OPEC and Russia this weekend.
Chinese credit stimulus and a 20pc rise in public spending has set off a fresh mini-cycle of growth that is already sucking in oil imports at a much faster pace than expected.
Barclays estimates that the country will import an average of 8m barrels per day (b/d) this year, a huge jump from 6.7m b/d last year. This is arguably enough to soak up a big chunk of the excess supply currently flooding global markets.
Standard Chartered said Chinese imports could reach 10m b/d by the end on 2018, implying a supply crunch and a fresh spike in oil prices as the market is turned on its head.
I’ve seen (briefly, so cannot be sure about it) that a lot of that is refineries taking advantage of changing margins. And they’re exporting the processed fuels. That’s not a change in end demand for oil, just a change in who is refining it.
Did you know, for example, that the economy of Northumbria is of about the same size as that of Zimbabwe?
London of Nigeria or South Africa or Egypt? Lancashire of Libya? Oxfordshire of Mozambique?
Now you can see it all in graphic format here.
The genesis of the project being:
…..a map of England showing a comparison of the English county economy to African country economies, showing just how small some African economies are and therefore the slight strangeness of insisting in trade barriers between African countries when we would laugh off the idea of a trade barrier between Norfolk and Suffolk.
More than 1,500 square miles of land — more than twice the area of Greater London — needs to be earmarked for new homes to solve Britain’s housing crisis, the planning minister will say today.
Gosh, that is a lot, isn\’t it? As much as 1% of the country.
“In the UK and England we’ve got about 9 per cent of land developed. All we need to do is build on another 2-3 per cent of land and we’ll have solved a housing problem.”
That\’s developed at all: that\’s all factories, all housing, all roads. Going from 91% undeveloped to 89% undeveloped will be the very death of all that is green and lovely, won\’t it?
“Land is expensive but to some extent [developers] are just lazy. They didn’t talk to local people or get involved enough. But also it’s just bloody expensive to build because land is expensive,” he said.
Ah, no, you\’re wrong there. Land is cheap. £10k a hectare or so. It\’s land that you\’re allowed to build on that\’s expensive. That scarcity value of planning permission.
Prompted by this, another in our series of idiot questions.
Umm, isn\’t the point of the system that those who are making the best profits, those profits reflecting their delivery of the most value with the least use of inputs, expand, while those losing money, reflecting their production of less value with greater use of inputs, should contract?
A comment I left on a CiF piece about kidney transplants:
\”the issue certain CiFers here have with the Iranian system is possibly the additional payments a recipient can make, in addition to one made by the state – this for obvious reasons could inform a decision on who gets an organ. There is no mechanism in place to stop the highest bidder being awarded an organ – it\’s not a sound system.\”
Fair point…..but only if you\’re prepared to accept the corollaries of that point.
The Iranian system works…..they do not have a large group of people slowly dying on dialysis machines. They do not have a long waiting list for kidneys. The system is also hugely cheaper….transplants are cheaper than dialysis after about 18 months.
Now, if you want to say that a cheaper, better system, better in the sense that it is both cheaper and saves more lives, cannot be allowed to happen because of your ethical concerns about rich people being able to benefit from being rich, well, go right ahead.
I\’d just like you to go and make that case in a renal ward. Go explain it to someone dying because dialysis is no longer working and they\’re too far down the list to get a transplant. Lay out your ethical concerns to them. Tell them the truth, what you really believe.
They must die because you think it\’s icky if rich people get to live as well.
You could even take it further. Stand up at the funeral of one of those kidneyless patients. Tell the mourners that it is righteous and just that their loved one died so that your own conscience could be clear.
Then, if I might polititely suggest this, go and hang yourself out of shame that you would kill people in the name of your \”ethics\”.
I entirely reject the contention that you have the right to turn other people into corpses in order to salve your own conscience.
We can actually see the value of being a monopoly supplier.
According to the NHS drugs price list, in October last year a 125ml course cost the NHS around £4 a bottle. Now, the NHS price – which includes the wholesale cost set by the drugs company and a built-in profit for High Street chemist shops – has risen to £21.87, a more than five-fold increase.
The NHS price of the 250ml course, also branded as Floxapen Syrup, has risen from £8.02 last year to £26.87.
Until last year, the medicine, which is prescribed to more than two million patients annually, was made by two of the world’s biggest drug companies, Teva and Actavis.
But the price increases coincided with a decision last year by Teva to stop making the drug – claiming it was too expensive and unprofitable – handing its rivals a virtual monopoly.
The subsequent price increase could cost the NHS and the taxpayer an estimated £44million in extra prescription costs for this drug alone.
No, not the idea, but the place it\’s seen.
What we need is a good idea. Lots of good ideas.
In this regard, we just may be in luck, because we are higher primates, with enormous frontal lobes, capable of dazzlingly complex thought. And while we wouldn\’t even be able to make a pencil if left to our own devices – no single person knows how to mine graphite, make rubber or paint etc – we\’re not individuals, we\’re a species. Our collective intelligence is both extraordinary and infinite.
Which is just as well. Because if it was left to our governments, we might as well get in the suicide pills now.
Have we really just had the Observer editorial telling us that markets work and planning doesn\’t?
Its certainly a valid objective. Raising the wages of manufacturing workers….I\’m all for it, assuming that it\’s not at the expense of others. You know, like price policies that benefit the urban worker at the expense of the rural (like, say, price caps on farm outputs).
So, how might you go about raising those industrial workers\’ wages?
Yup, you liberalise the capital account. You let those filthy foreign capitalist bastards come in and exploit those industrial workers by investing in the companies they work for. You let the running pig dogs grow fat off the expropriation of the workers\’ labour.
For three years after the typical developing country opens its stock market to inflows of foreign capital, the average annual growth rate of the real wage in the manufacturing sector increases by a factor of seven. No such increase occurs in a control group of developing countries. The temporary increase in the growth rate of the real wage permanently drives up the level of average annual compensation for each worker in the sample by 752 US dollars — an increase equal to more than a quarter of their annual pre-liberalization salary. The increase in the growth rate of labor productivity in the aftermath of liberalization exceeds the increase in the growth rate of the real wage so that the increase in workers\’ incomes actually coincides with a rise in manufacturing sector profitability.
So would all those who insist that the problem in poor countries is too much exploitation by top hatted plutocrats please bugger off? You\’re making people poorer than they need to be.
Senators Carl Levin and Dianne Feinstein intend to close the "London loophole" by empowering the CFTC to impose speculative limits on US traders who use London exchanges. The move is aimed at helping to prevent price manipulation and excessive speculation in the oil market.
The senators\’ aim goes one step further than the CFTC\’s current investigation into the US crude oil market, which was announced on Thursday, by giving the American futures regulator the power to intervene in trading activities that occur outside its own legal jurisdiction.
Both politicians are keen to reduce the amount of speculative energy trading, which they believe pushes up the price of crude oil, and so petrol prices, unfairly hurting their constituents.
They are of course perfectly at liberty to impose restraints on trades by those in the US. It won\’t have much effect for if it is seen as a burden by said traders then they\’ll simply open a desk in London or Zurich.
But the real fuckwittery comes from the attempt to curb speculation. Speculators smooth out prices over time….they move shortages and gluts and the associated price rises and falls intertemporally, something that we all rather desire should happen.
But then they are indeed politicians so perhaps we shouldn\’t expect them to understand anything about the real world.
There are only 364 shopping days before Christmas!
This has been a public service announcement.
With those contracts due to expire at the end of this month the writers, who can earn anything from $10,000 to $200,000 per episode are arguing for a share of both income streams.
Tim Adler, editor of TV magazine Screen Finance says one of the concerns will be that with many top British writers forced into membership of the Writers Guild of America in order to sell their work to US studios, they could be forced to turn down any work that does drift across the Atlantic.
Hmm. How does one become a script writing scab? Of course, there\’s a basic assumption here that (having seen a lot of US TV I do so assume) talent and ability are not a necessary requirement.
How glorious this is and how silly of me not to have seen it coming.
So, the allegation is that the supermarkets are doing two things. Firstly, that they\’re oligopolists of a kind, carving up the shopping market between them and there\’s not enough competition. The second is that they\’re driving the smaller retailers out of business….that is, that there\’s too much competition (which is an odd thing to accuse of happening but there we are).
So those fighting either side of that argument (actually, I think the review was demanded by those representing the smaller retailers) ask for someone to go and have a look at the market.
The planning system will also be criticised and is likely to be revamped. The commission will suggest that the "needs test", whereby a new entrant has to prove that a town requires a new supermarket, is a barrier to entry and could be axed. The needs test is unpopular as it hands a big advantage to the incumbent in any town. Abolishing the test would create a level playing field between the big four by making it easier for them to open stores.
However it could prove unpopular with small, independent retailers, who have been put under unprecedented pressure by supermarkets\’ unrelenting expansion.
Aha! There\’s isn\’t enough competition and it isn\’t because of collusion amongst the supermarkets themselves, rather, it\’s the planning system itself. So, loosen that system, allow, even promote, more competition and see the consumers revel in further surplus.
Pity about those small retailers who are going to get steamrollered of course…but then they did ask for the review in the first place.
A little lesson perhaps: if you\’re a lobbying group you might not actually want someone to have an impartial look at you. Might be better just to keep screaming emotionally from the sidelines.