Power Up: Oil markets move on from Beryl but clean up in Texas continues
By Gavin Maguire, Global Energy Transition Columnist
Hello Power Up readers! Oil markets have moved on from the disruption caused by Hurricane Beryl in the Houston area earlier this week, with traders now trying to reconcile a downbeat demand outlook from the International Energy Agency (IEA) with signs of recovering consumption in the United States.
On the ground in Texas, however, over a million customers remained without power on Thursday after the first major storm of the season slammed key energy infrastructure.
More on that below, along with other major energy and power sector news and analysis.
Cleaning up after Beryl
About 1.3 million customers remained without power in Texas on Thursday, three days after Hurricane Beryl lashed the state, as progress to restore electricity was slow, hampering efforts to quickly restart critical oil infrastructure.
The storm made landfall as a Category 1 hurricane on Monday near the coastal town of Matagorda, about 100 miles (160 km) from Houston, lashing Texas with heavy winds that knocked down power lines and damaged property.
Among Texas' most affected zones by wind damage and lack of power were cities from Lake Jackson and Galveston on the coast to Houston, including energy hubs Freeport and Texas City, according to officials and utility CenterPoint's outages map.
Chemical manufacturer Olin declared force majeure over shipping of some product and aromatics, saying that Beryl had caused damage to its Freeport facilities, impacting production and access to power, raw materials, and feedstocks.
In a letter to the state's largest power provider, CenterPoint, on Wednesday, Congresswoman Sylvia Garcia said the firm's inability to restore power more quickly was creating a public health crisis. "Hospitals are now unable to send patients home where they lack power for medical equipment or an appropriately cool environment for their conditions." Here's the latest on that developing story.
Essential reading
Global oil demand growth will slow to just under a million barrels per day (bpd) this year and next, the International Energy Agency (IEA) said, as Chinese consumption contracted in the second quarter due to economic problems.
BP expects oil demand to peak next year and wind and solar capacity to grow rapidly in the two main scenarios in its annual Energy Outlook, a study of the evolution of the global energy system to 2050 it published on Wednesday.
Combined electricity generation from solar and wind farms in the United States surpassed output from nuclear plants for the first time during the opening half of 2024, cementing renewable energy assets as the primary source of clean power in the country.
Hundreds of oil tankers snake each day from near Kurdistan's capital Erbil for Turkey to the north and Iran to the east, clogging the Iraqi region's often winding and mountainous highways. The tankers are part of a massive operation to truck oil from the semi-autonomous region of Iraq to Iran and Turkey in murky, off-the-books transactions that have boomed since an official export pipeline closed last year. Reuters' Iraq bureau chief Timour Azhari reports from the region here.
Europe’s gas storage is filling more slowly than normal this summer, which has reduced the probability space will run out before the onset of the main winter heating season.
Australia's electricity producers lifted generation from fossil fuels by more than from clean power sources during the first half of 2024, undermining the momentum of the country's energy transition from polluting fuels.
Portugal plans to increase the weight of renewables to 51% of its final energy needs by 2030 from a current target of 47% as part of its goal to become carbon neutral by 2045.
A rise in European wholesale gas prices over the past several months could encourage more utilities to switch to coal for electricity generation this coming winter, even as countries try to push the carbon-intense fuel out of the power mix.
Almost two-thirds of big wind and solar plants under construction globally are in China, where surging renewable capacity has squeezed coal's generation share to new lows, research released on Thursday showed.
Global hydroelectric generation slumped to a five-year low last year as a result of lower-than-average rainfall across China, North America and India, contributing to record fossil fuel combustion and emissions in 2023. But heavy rains in key regions look set to lift hydro output in 2024, and cap fossil fuel use this year.
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Editing by Emelia Sithole-Matarise
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