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- Speaking of which, today's Smart Brevity count is 1,277 words/< 5 minute read.
Onto music. 25 years ago, the Beastie Boys were about to ascend to the top spot on Billboard's album charts with "Ill Communication," which provides today's intro tune...
1 big thing: Apparent tanker attacks jolt oil market
Oil prices climbed Thursday after 2 tankers were reportedly attacked in the Gulf of Oman, a major oil shipping region.
Where it stands: Via the Wall Street Journal, "Bermuda-based shipping company Frontline Ltd. said one of its vessels, Front Altair, was on fire in the Gulf of Oman and its crew had been safely evacuated from the ship."
- Front Altair, which was loaded with the petrochemical feedstock naphtha, may have been hit by a torpedo, per the Telegraph.
- BSM Ship Management, which manages the other vessel, Kokuka Courageous, said in a statement its 21 crew members abandoned ship, with 1 crewman "slightly injured." Its methanol cargo remains intact, they said.
- Both ships have been evacuated, according to news reports.
Driving the news: "U.S. Naval Forces in the region received two separate distress calls at 6:12 a.m. local (Bahrain) time and a second one at 7:00 a.m. U.S. Navy ships are in the area and are rendering assistance," the Navy said in a statement.
The big picture: The incident is a reminder of how geopolitics can quickly shake up oil markets. Thursday's rise reverses price declines in recent days and weeks based on bearish forces — prospect that the economic slowdown will dent demand growth, robust supplies, and trade battles.
- Prices were rising, with Brent crude trading around $62.33 and WTI at $53.04 this morning.
Threat level: Today's incident comes a month after several other tankers suffered damage in the same region, apparently from mines.
- CNBC notes: "When four tankers sustained damage in the attacks of May 12 — two Saudi-owned, one from the UAE and one from Norway — crews did not have to abandon ship, indicating that today’s attack is much more serious."
What they're saying: “Even in the absence of ironclad evidence, the U.S. and its allies will point the finger at Iran,” Fawaz A. Gerges, a Middle East expert at the London School of Economics, tells Bloomberg.
- “These incidents are a bad omen because they point to a calculated escalation that tells us sides are hunkering down," Gerges said.
2. The shale oil boom and wasted gas
Axios' Amy Harder reports ... Oil producers around the world wasted as much natural gas in 2018 as South and Central America tend to use in an entire year, according to new data from the World Bank.
Driving the news: Intentionally discarding natural gas by burning it off as carbon dioxide, a practice called “flaring,” increased 3% to 145 billion cubic meters last year compared to 2017.
- In the U.S., flaring rose by nearly 50%, driven by booming oil production and a relative lack of infrastructure to contain associated natural gas.
Why it matters: For both climate and business purposes, flaring contributes to climate change and wastes a product that could be sold commercially.
- The practice of flaring contributes to climate change by emitting CO2. It's a better option compared to venting. That's another, less common industry practice of sending methane — the primary component of natural gas — straight into the atmosphere. Methane's short-term warming impact on the planet is far greater than that of CO2.
- From a business perspective, companies are wasting a sellable product that’s becoming the world’s dominant energy source. World Bank experts and environmentalists argue this is an especially needless contribution to climate change.
Where it stands: As the accompanying chart shows, the U.S. ranks fourth for how much natural gas is being wasting while producing oil, behind Russia, Iraq and Iran. Trends like these are among the starkest negative environmental consequences of America's oil and gas boom, which has made the U.S. the largest producer of both in the world.
But, but, but: Despite the overall increase, the flaring intensity in the U.S. — the volume of gas flared per barrel of oil produced — remains very low (far lower than the 3 others on the chart).
The upshot of this underscores just how much oil the U.S. is producing compared to both the available infrastructure and other countries.
Bonus: The shale-driven export surge
If the rise in flaring is one effect of the shale surge, Energy Information Administration data released yesterday puts a highlighter pen over another — U.S. crude export growth.
By the numbers: The week ending June 7 was the 3rd in a row with exports above 3 million barrels per day, marking the first back-to-back-to-back run in EIA's weekly tracking. And it would be 5 in a row absent a narrow miss the week ending May 17.
The big picture: 3 million barrels per day is on its way to being the new normal, with room to grow.
- Yes, the weekly data is preliminary and an incomplete snapshot (more robust data has a months-long lag).
- But the trend is clear and underscores how the U.S. is now a major player in crude export markets following a late 2015 law ending a decades-old ban.
3. The struggle to write the Green New Deal
The Atlantic's Robinson Meyer has behind-the-scenes info on a newly prominent think tank's effort to fill in the policy blanks of the Green New Deal.
Why it matters: The sweeping template pushed by Rep. Alexandria Ocasio-Cortez is firmly in the Democratic conversation — even the party's 2020 frontrunner Joe Biden's climate plan praises it.
Where it stands: The piece explores the young lefty think tank New Consensus' ongoing work to transform the GND into detailed proposals — and their struggles.
One part that caught my eye explores what I consider to be a weakness in the GND movement: the failure (so far) to get many major unions on board.
Details: Here's some of Meyer's reporting on a March meeting that New Consensus convened with activists and experts...
Todd Vachon, a labor-studies researcher at Rutgers University who attended the meeting, told me he was surprised that no union officials were present.
“We were kind of there, looking around and saying, where are the labor people?” he said. “There weren’t really any active presidents of unions—people who have the authority to speak on behalf of an organization. It was academics and researchers on one side, and grassroots organizations on the other.”
What's new: More recently, as Meyer notes, the influential Service Employees International Union backed the GND, joining some other unions. But the absence of broader labor support is something to watch going forward.
4. Catch up fast: trucks, divestment, politics
Geopolitics: Via CNBC, "President Donald Trump on Wednesday said he is still considering using sanctions to block a controversial pipeline that would increase natural gas flows from Russia to Germany."
LNG: "Polish Oil and Gas Company (PGNiG) signed an agreement on Wednesday with U.S. company Venture Global LNG to buy 1.5 million metric tons of liquefied natural gas per year, as the country seeks alternative supplies of gas than Russia," Reuters reports.
Money: Per Bloomberg, "Norway’s $1 trillion sovereign wealth fund got the green-light to dump more than $13 billion in stocks linked to fossil fuels as well as a broad range of emerging-market bonds."
- But, but, but: The plan does not apply to major integrated oil companies like ExxonMobil, Shell and so forth.
Trucks: The European Parliament and the Council of the EU adopted first-time standards for big trucks and other heavy duty vehicles on Thursday. The rules force manufacturers to emissions from new trucks by an average of 15% by 2025 and 30% by 2030.
5. Number of the day: 0.2
0.2%: That's the share of global electricity consumption from Bitcoin mining, according to a new paper in the journal Joule described in this MIT Technology Review piece.
Why it matters: That's a lot of power, though James Temple's piece notes other research that provides an even higher estimate.
- Per his story, the paper finds that Bitcoin mining produces estimated annual emissions of 22–23 megatons of CO2, "slotting the operations between the nations of Jordan and Sri Lanka in terms of greenhouse-gas pollution."
- "Including other cryptocurrencies in the calculation more than doubles estimates of how much energy is being used," he writes.