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Jeff Rubin on oil & the end of globalisation

Written By: - Date published: 4:29 pm, November 14th, 2010 - 23 comments
Categories: Economy - Tags: , , ,

The transcript of Jeff Rubin speaking at the ASPO-USA conference, supplied by The Oil Drum:

You know, knowing the nature of the disease is usually an essential first step to finding a cure. And so too, it is with a recession. Knowing the true nature of a recession goes a long way in helping us to avoid falling into another one. Particularly when the recession we are just coming out of happens to be the deepest global post-war recession on record.

Conventional wisdom, as espoused by central bankers, finance ministers, and the pundits that you watch on TV would have you believe that the recession that we are still feeling here in America, and, indeed, throughout the world, was all about a financial crisis, whose roots lie in the failed sub-prime mortgage market in the United States. In other words, a whole bunch of boarded up, repossessed unsalable houses and depressed property markets in places like Cleveland, all financed with easy credit and subprime mortgages, hit financial markets like some toxic hydrogen bomb, and then all of a sudden, a property market crash in the United States, somehow morphed into a deep, global recession.

Gee, I never knew that Cleveland was that big. No one has to tell me about the impact of the subprime mortgage market on financial markets. Why do you think I am an author now? But there is a big difference between blowing up the bonus pools of investment banks, and blowing up Wall Street, and what happened.

If you are wondering why risk-averse institutions like the bank that I used to work for had to write down almost $10 billion of assets of things called Collateralized Debt Obligations that were funded by pools of subprime mortgages, the reason is pretty simple: they were rated AAA, which meant that rating agencies assigned the risk of default with the same probability that the US Treasury would default. What the banks lost sight of is how rating agencies get paid. Rating agencies don’t get paid by investors; they get paid by issuers. In Economics, we call this moral hazard problem. In investment banking, we call it, “Shit happens.”

It is easy to see how sub-prime mortgages blew up Wall Street; it is a little more challenging to see it as the author of the global recession. Why were there economies that had no sub-prime mortgages that experienced even deeper recessions than the United States? Why did those economies go into recession even before the US economy went into recession? Maybe, just maybe, there was something more important going on–more important to the global economy than Wall Street or sub-prime mortgages, like $147 barrel oil, for example. If we know anything about watching the global economy in the last 40 years, we know this: feed it cheap oil, and it runs very smoothly. All of the sudden, give it expensive oil, and it stops in its tracks.

Every major recession in the post-war period has oil’s fingerprints all over it. The 1973 first oil shock led to what was then the deepest post-war recession, at the time. The second OPEC oil shock led to no less than two recessions: 1979 and 1982. And then when Saddam Hussein invaded Kuwait, and left half of its oil fields on fire, and oil spiked to the then unheard-of price of $40 barrel, lo and behold, the industrialized world again fell into recession.

Gee, I wonder what happened to oil prices before this recession. It seems to me that oil prices went from about $30 barrel, at the beginning of 2004, to almost $150 barrel by 2008. Even in real terms, that is, inflation-adjusted, that price increase was over double the price increase of either the first or the second OPEC oil shock. If they had led to devastating recessions, why would not the biggest oil shock of them all, be the obvious culprit for what has been the deepest recession to date?

There are many ways in which oil shocks create global recessions. First, the transfer of income. When oil went from $30 barrel, to about $147 barrel, over $1 trillion of income was transferred from the industrialized oil consuming world to OPEC. Now, that was not neutral for the economy, because the savings rates from which money was coming from, like the United States, was virtually 0%, meaning that consumers spent everything they made. And where the money was going to, places like Saudi Arabia, or Kuwait, or the United Arab Emirates, had savings rates of almost as high as 50%, so it certainly was not demand neutral.

High price also create recessions by crowding out non-energy expenditures. Two years ago, when gasoline cost us $4 gallon, low-income Americans were paying more to fill their tanks than they were to fill their stomachs.

But by far, the most important mechanism, the most important path, by which oil prices cause recession is through their impact on inflation, and their impact on interest rates.

There is no shortage of people to blame for the subprime mortgage crisis. We could start with fraudulent mortgage companies that approved mortgages, then quickly sold them to financial institutions. We can blame financial institutions who played Russian roulette with depositors money, and of course we can blame rating agencies who assigned AAA ratings to this. And we can blame regulators, who were asleep at the wheel, like the Securities Exchange Commission, who were either blind or indifferent to Wall Street’s systemic risk to subprime mortgages.

However, the real culprit behind subprime mortgages was the very low cost of capital and 0% interest rates. All the greed in the world could not do what the Fed’s easy money made possible. The subprime mortgage rates were created by interest rates and the subprime mortgage market was pricked by interest rates. Everybody would agree with that. What people don’t seem to ask is, “Just why did interest rates go from 1% to 5.5% from 2004 to 2006?”

Well, any central banker, even Alan Greenspan, will acknowledge that your borrowing cost is a mirror image of your inflation rate. We had 1% federal funds’ rate in 2004, because we had a 1% inflation rate. All of the sudden, in 2006, inflation was over 5.5%, the highest it had been in America, since, coincidentally, 1991, when we just happened to have the last oil shock. All of the sudden, money wasn’t free any more. All of the sudden, you weren’t getting credit cards in the mail any more that you never applied for. And all of the sudden, people who held negative amortization sub-prime mortgage rates had to start paying 7% or 8%.

Well, if interest rates hadn’t risen, that wouldn’t have occurred. Why did inflation move up? Virtually all of the increase in inflation came from one component of the US consumer price index basket–the energy component. By the end of 2006, energy inflation was running at 35%, because of one price: the price of oil. The price of oil went from $30 barrel, which incidentally, every oil analyst at the time said it was going to stay at that level, to over $70 barrel. If oil had stayed at $30 barrel, inflation would never have spiked; neither would have interest rates. All of those good folk in Cleveland would probably still be there, in their homes financed by 0% interest rate sub-prime mortgages. Lehman Brothers and Bear Stearns would probably still exist, and I’d probably still be the chief economist at CIBC.

But that is not what happened. Why did oil prices go up to $147 barrel? Somewhere where virtually every economist said it could not go. Well, there were two reasons that economists said that oil prices could not get into triple digit range, and that was the cherished principles of supply and demand. First, the theory of the upward sloping supply curve–higher oil prices would bring new supply, just like it did after the OPEC oil shocks, where oil gushed from Prudhoe Bay and the North Sea. And not only did that break OPEC’s strangle-hold on the market, but sent oil prices tumbling down.

Unfortunately, as you all know, there are no more Prudhoe Bays or North Seas to come on tap. Yes, there are tar sands, and theres is deep water, and the upward sloping supply curve did bring new sources of supply, but only at prices that we at the end couldn’t afford to burn.

What about the cherished principle of demand? Would not triple digit oil prices quash demand? Well, it did, in certain places. It did in the United States. It did in Canada. It did in Japan. It did in Western Europe. Fifteen years ago, if those economies suddenly cut back their appetite for oil, oil prices would have fallen, because 15 years ago, those countries would have accounted for almost three-quarters of world oil consumption. Today, they account for barely half. Tomorrow, they will account for less than half. It wasn’t the US consumer that drove oil demand to $147 barrel in the last cycle, and it certainly won’t be the American consumer that drives a barrel of oil to $147 and higher in the next cycle. We have already seen peak demand, in this economy, and in the economy of the other industrialized countries.

Where do you think oil demand has been growing the strongest? Many of you will probably be saying China, and indeed it has. It’s grown from around 2 million barrels a day, to about 9 million barrels a day. But I know a place where the demand for oil is growing even faster than in China. And it is the same place your politicians have told you your supply is coming from in the future. Last year, OPEC and two non-cartel producers, Mexico and Russia, consumed 14 million barrels a day. That is almost two Chinas.

What makes OPEC so thirsty for its own fuel? Well, if you ever filled your tank up in Caracas, you would get some sense of it. It is 20 cents a gallon. And if you go to Riad, in Saudi Arabia, it is a little bit more-it’s 40 cents a gallon. And it’s 40 cents a gallon, whether oil costs $20 barrel, or whether oil costs $150 barrel.

If you think drivers have a good deal in OPEC countries, they don’t have anything as good a deal as power users. What’s the coolest thing to do in Dubai? Ski, of course. I love skiing; I’m Canadian. But going skiing in an area where it’s hot enough to fry an egg on the pavement uses up a whole lot of energy. In fact, one day at Ski Dubai uses the equivalent energy that a North American would consume in a month’s worth of driving. So the question isn’t really how much productive capacity that OPEC has. How much export capacity is the real question, and every year that is less and less, because every year, more and more is consumed at home.

Now, it’s their oil and gas, and if they want to consume their oil and gas going skiing in one of the hottest deserts in the world, that is their right. All I’m saying is, chances are, your future oil supply ain’t coming from OPEC, and chances are, it ain’t going to be cheap.

Now sure, oil prices fell to $40 barrel during the recession. And for many folk, that was evidence enough that it never had any business being in triple digit range in the first place. But what a lot of those folk forget is that in the last recession, world oil demand actually fell. It fell for the first time since 1983. Such was the severity that the recession was.

Peak oil is not a problem if the economy that it is powering is shrinking. Peak oil is only a problem if the economy we are in is starting to grow. The first thing you know about an economic recovery is that economies start burning more oil. The next thing you know about an economic recovery is that oil prices start rising. Where is oil trading today? It is trading at over $80 barrel. With the exception of Germany and Canada, every other economy in the G7 is still miles below the level of GDP that they were at before the recession began.

And yet, where oil is trading today, turn the clock back to three years ago, and that would have been a world all-time record high. Now, it is where oil trades in the shadow of the deepest global post-war recession. Where do you think oil prices are going?

I will tell you where I think oil prices are going. Even in this most anemic of economic recoveries, we are going to see triple digit oil prices. We are not going to see triple digit oil prices in 10 to 15 years. And it is certainly not clear to me that the global economy is better able to handle that than in 2008. Now, a lot of people will say, “Jeff, economic history tells us that scarcity is the mother of invention. Give us 10 to 15 years of adjustment, and we will develop alternate technology, so we won’t be carbon-dependent.”

And they are right. Give us 10 to 15 years, and we will solve this on the supply side. But as I say, our rendezvous with triple digit oil prices is not in 10 or 15 years; it is in 10 or 15 months. So instead of trying to turn cow-shit into high octane fuel, we are going to have to learn to get off the road, and that is just what happened. In 2009, there were 4 million fewer cars on the road than there were the year before. In the next ten years, 40 million North Americans will be taking the exit lanes. The question is, “Will there be a bus to get on?” Instead of giving $40 billon to General Motors, what we should have done is spend $40 billion on public transit, so there would be a bus to get on.

In a world of triple digit oil prices, all of the sudden the economy’s speed limit changes. And that is one of the problems that we have here in America, is that we don’t recognize that our economy’s speed limit has changed. What the economy could grow at when oil was $20 to $30 barrel is a whole different speed limit than what the US economy can grow at when oil is $80 to $150 barrel.

And that is something that I don’t think the Administration recognizes. Because what President Obama cannot bring is cheap oil. He can get expensive oil. We can build a pipeline from the Canadian tar sands down to the Gulf refineries, and we can get oil. But in order to get the kind of oil that will be required, that will require the triple digit oil prices that we can’t afford to pay. But trying to pump-prime the economy with fiscal stimulus is not a substitute for cheap oil. It won’t make the economy grow any faster. It will just make the deficit that much bigger.

Worse than that, triple digit oil prices will not only take millions off the road, it will send our economy right back into recession, unless of course, the economy changes. We can’t do a whole lot about triple digit oil prices. That is where the supply curve lies. And if you doubt that, just look at the Canadian tar sands. Like sure, there is 170 billion barrels of it there, and there is 500 billion barrels in the Orinoco heavy oil belt, but that is not the issue. Depletion is not just the geological concept, it is more fundamentally an economic concept. Because if the cost of extracting that oil from the tar is greater than we can afford to burn, it doesn’t matter how many billion barrels of oil there are in the tar sands.

So how do we adapt? How do we grow in an economy of triple digit oil prices? We change the nature of our economy. In a world of triple-digit oil prices, distance costs money. The global economy, where we produce one thing at one end of the world, to be sold at the other end of the world, doesn’t make any economic sense, because in too many cases, what will be penny-wise, will soon become pound-foolish. The wage “arb”, what we save on wages, we will more than squander on bunker fuel.

Take the steel industry, for example. Just before the recent recession, some very curious things were happening in the US market. When oil prices got to be over $100 barrel, all of the sudden, Chinese steel exports to the US fell at double-digit rates. And all of the sudden, US steel production was up. And all of the sudden, US Steel Corp., which was one of the biggest dogs in the market, all of the sudden its share price doubled.

What was going on? I’ll tell you what was going on. For the first time in 20 years, it was cheaper to make steel in the United States than to import it from China. Why? Consider what China has to do to send you steel. First, it has to ship iron ore from Brazil, across the Pacific Ocean, turn it into steel, which is itself a very energy-intensive process, then ship it back, across the Pacific Ocean, to you. At $20 barrel, that works. At $100 barrel, that doesn’t work. It added on $60 to $70 dollars, to the cost of a ton of hot-rolled steel. How much labor time do you think there is in making steel these days? One and a half to two hours. The transit costs all of a sudden exceeded the labor costs. Who would dream that triple digit oil prices would breathe new life into our hollowed-out Rust Belt? But in a world where distance costs money, that is exactly what is going to happen.

Take food. Last year, China exported $6 billion of food to America, everything from apples to frozen chicken wings, bringing a whole new meaning to having your Chinese food delivered. Steel doesn’t have to be refrigerated. Hopefully, frozen chicken wings do. What do you think powers that refrigeration unit? Bunker fuel! The same thing that is powering the boat. The world of triple digit oil prices–it won’t matter that farm labor is cheaper in China than in the United States, because the cost of bringing those frozen chicken wings to us will be too expensive.

it’s not like we are going to stop using steel in America, and it is certainly not like we are going to stop eating. What we are going to have to do is make our own steel. What we are going to have to do is grow more of our own food. Unfortunately, much of our agricultural land has been paved over with suburban sprawl. Just as triple digit oil prices will breathe new life into our hollowed out Rust Belt, triple digit oil prices will turn those far-flung suburbs and exurbs back into the farmland they were, thirty to forty years ago. The very same economic forces that gutted our manufacturing sector, that paved over our farm land, when oil was cheap and abundant, and transport costs were incidental, those same economic forces will do the opposite in a world of triple digit oil prices. And that is not determined by government, and that is not determined by ideological preference, and that is not determined by our willingness or unwillingness to reduce our carbon trail. That is just Economics 100.

Triple digit oil price is going to change cost-curves. And when it changes cost curves, it is going to change economic geography at the same time. I know that the world of triple digit oil prices has been the domain of the apocalypse. For many people, the advent of peak oil and triple digit oil price means the end of our economy. For some, civilization as we know it. I don’t share that pessimism. I don’t share that outlook. I’m an economist. I believe in the power of prices.

Sure, if we continue to want to get our frozen chicken wings from half-way around the world, where labor is cheap, if we want to get our steel from half way around the world, if we want to commute back and forth eighty miles to work in our SUVs, peak oil won’t just be a recession, peak oil will be peak GDP, and that will be apocalyptic. But as I say, I am an economist, and I believe in the power of prices. I believe we are going to change. I believe that we are not going to end up importing food from half-way around the world, or steel from half-way around the world. I don’t think we are committed, irrevocably, to suburban sprawl.

And we might just find that that new smaller world around the corner is a whole lot more livable, and a whole lot more sustainable, than the big “oily” one we are about to leave behind.

Thank you very much.



23 comments on “Jeff Rubin on oil & the end of globalisation”

  1. Draco T Bastard 1

    The problem that the economy is having is an economic problem caused by over reliance upon a monetary theory that pretty much ignores the economy while boosting the importance of the financial sector. This causes the economic problem to look like a financial problem.

    economic problem = resource constraints

    Neo-liberalism, which is the underlying theory of our “economies”, isn’t an economic theory but theory about money. In the world of money, where infinite amounts can be printed, then neo-liberalism and it’s assumption of a non-zero-sum game works but in reality, where there are finite resources and finite competition (because competition costs too much of those finite resources), the whole thing falls down.

    The real economy, the one we actually have to live with, is a zero-sum game delimited by the renewable resource base.

    • Bored 1.1

      Draco, the real issue is not the theory or practice of market economics, it is the end result for those who control the economy. The rich. More importantly the mega rich. These monsters could not really give a f**k about whether the method is laissez faire or totalitarian command, all they care for is that we meakly donate our bodies minds and souls to their enrichment. They and their allies have to be taken out of the loop, their control of the economy leaves us with a facade of democracy that is just that, a facade.

  2. ianmac 2

    “Rating agencies don’t get paid by investors; they get paid by issuers.”
    Oops Marty. Does that mean that NZ ratings are in that category? Seem to Bill English applauding our ratings. Same thing?

    • KJT 2.1

      The rating agencies have all totally blown any credibility they may have had. Another of the great mysteries is why anyone even uses them any more?

  3. Joachim's 3

    Jeff Rubin is a good listen.

  4. Jenny 4

    .
    At the G-20 meeting, one very brief discussion over global warming was scrunched into a meal break. According to Scientific American, this despite pressure coming from EU leaders to raise this issue at the G-20, they were unable to even get it on the formal agenda.

    So what is it that so distracts the governments of the G-20?

    What is it that is absorbing their attention so much that dangerous global climate change endangering the lives of millions of people, mostly in the third world, is not even considered worthy of being an official topic for discussion?

    Currency wars between the major powers each trying to shore up national profit taking at each others expense, have pushed climate talks on the back burner.

    Currency wars have pushed climate talk even further on the back burner of the G-20 meeting in Seoul, Korea, this week as President Obama and other world leaders spar over the global economic recovery.

    In response to the economic recession Central Banksters, and the governments they advise, are trying to increase export trade advantages by slashing the value of their currencies.

    As well as consuming the G-20’s full attention and putting global warming off the agenda, Currency Wars have a number of other effects.

    1/ The most important effect and the reason for doing all this- It Increases Profits and protects the privilege and power that spring from profit.

    2/ In a world awash in unsold goods, and glutted markets, it makes your country’s trade goods cheaper on the world stage.

    3/ Theoretically this increases export sales, while cutting imports. (as long as everyone else doesn’t do it as well.)

    4/ It slashes the buying power of working people delivering a massive wage cut to the working people of each country that devalues.

    5/ It threatens a race to the bottom and a call for trade protectionism to avoid this.

    5/ It increases the likelihood of trade wars and heightens the tensions that lead to shooting wars.

    At a time of falling profits due to the recession, you can see why the governments of the G-20 would be concerned, as maintaining profit is their main obsession.

    In the 20th Century most of these same governments fought wars for profit, violently suppressed unions for profit, stood by while public and private enterprise were allowed to recklessly pollute and damage the environment for profit. So it is no surprise to me that in the 21st Century these same governments are preparing to commit ecocide in the name of profit.

    It is like being locked in a burning house that is being looted by gangsters, who are too distracted fighting each other over the loot, to attend to putting out the fire…

    Except in this case, there is no other house to go to, and these gangsters are locked in the house with the rest of us.

  5. KJT 5

    Oil prices ending so called free trade and globalisation may be the best thing that has happened for a long time. It will force re-investment in local manufacturing and local work forces world wide as well as forcing New Zealand to develop local sustainable energy.

  6. Bored 6

    The end of the oil age may signal the first sea change in economic thinking, but it will not result in a change to the modus operandi of the ruling elites. They will find another method of ensuring that they control the worlds resources and economies for their own benefit. It may be totalitarian (why else do you think that in the “land of the free” the apparatus and legislation for a police state is already in place?), it may be false populism, it could be patriotic wars. Oil was always going to run out, on the contrary the will of the elite to take our worth for their benefit will remain. We will have to fight them for our freedom.

  7. joe90 7

    Free trade?, maybe not.
    (registration required)

    If the Tea Party continues to influence the Republican agenda, it may not only spell bad news for the South Korea free trade agreement — it could also mean a fundamental reorientation of our country’s attitude toward trade and globalization.

  8. john 8

    “Triple digit oil price is going to change cost-curves. And when it changes cost curves, it is going to change economic geography at the same time. I know that the world of triple digit oil prices has been the domain of the apocalypse. For many people, the advent of peak oil and triple digit oil price means the end of our economy. For some, civilization as we know it. I don’t share that pessimism. I don’t share that outlook. I’m an economist. I believe in the power of prices.”

    My understanding of Peak Oil from such websites as Oilcrash.com(Robert Atack’s kiwi contribution), Lifeaftertheoilcrash.net,Postcarbon.org and others is that we are probably on the terminal downslope now of supply and there isn’t any other energy source that can match Oil in scale and ease of use and most especially the EROEI factor which is Energy Return on Energy Invested: For Instance At the start of the Oil Age An Investment of 1 barrel of Oil might return 150 barrels energy equivalent. The Price mechanism isn’t of any use for what is to be one of the biggest transitions Humanity has ever faced! Personally I find it scary, as R.A. says we should have been preparing from 20 years ago,but we humans just are too short term in our thinking,20 years in the future might as well not exist!

    The link below gives a 5 minute potted animation of the Industrial Era:

    http://www.postcarbon.org/blog-post/176080-the-ultimate-roller-coaster-ride-a

    • john 8.1

      A message for our local governments? Less Motorways much more efficient top class public transport! With triple digit oil prices we are in for another big economic knockdown Worldwide.Eventually triple digit oil will become the norm as supply continues downward.

      “And they are right. Give us 10 to 15 years, and we will solve this on the supply side. But as I say, our rendezvous with triple digit oil prices is not in 10 or 15 years; it is in 10 or 15 months. So instead of trying to turn cow-shit into high octane fuel, we are going to have to learn to get off the road, and that is just what happened. In 2009, there were 4 million fewer cars on the road than there were the year before. In the next ten years, 40 million North Americans will be taking the exit lanes. The question is, “Will there be a bus to get on?” Instead of giving $40 billion to General Motors, what we should have done is spend $40 billion on public transit, so there would be a bus to get on.”

  9. alloverrover 9

    its great to see this post on Jeff Rubin — follow his blog at http://www.jeffrubinssmallerworld.com/

    But what is Labour’s response to a looming oil shock.? There was a deafening silence from Labour to the Parliament Report last month “The Next Oil Shock” – http://oilshockhorrorprobe.blogspot.com/2010/10/nz-parliament-report-warns-of-imminent.html

    And commentators here and on other left blogs seem reluctant to acknowledge Labour’s weak response so far whenever peak oil is mentioned..

    Will Labour continue to pretend like National that “peak oil = peak economy” is not an issue worthy of even acknowledgment let alone a coherent policy response? Or will Labour front foot this issue, take the public into its confidence and in a measured and rational manner, and spell out the very serious implications for our economy and way of life? And then spell out in detail its policies?

    Robert Hirsch’s report to the US Dept of Energy said there needed to be world-wide wartime-like crash program of mitigation starting at least 10 years before the peak. We are likely already 10 years too late, but isn’t it time for Labour to show courageous political leadership ?

    • lprent 9.1

      You could always ask Labour?

      I’d start on RedAlert…

      • KJT 9.1.1

        I agree. There are some promising signs of life from Labour at the moment, especially from a couple of the younger members.

        • Colonial Viper 9.1.1.1

          Yeah man there is some serious fire in the Labour belly at the mo. First we are acting to take Mana, and once that is done and dusted we are going to refocus on…Botany?

      • alloverrover 9.1.2

        “You could always ask Labour?

        I’d start on RedAlert…”

        searching peak oil or oil shock drew a blank.. seems they are not subjects worthy of an alert – red or otherwise

  10. On behalf of the Prime Minister, Hon John Key, I acknowledge your recent email and regret the delay in acknowledging your email.

    Thank you for taking the time to write to the Prime Minister and share your views.

    Regards,

    Briane Smith |Private Secretary | Office of the Prime Minister

    DDI: 04 817 9789 |Fax: 04 472 2075 |

    Private Bag 18041 | Parliament Buildings | Wellington 6160 | New Zealand

    Please consider the environment before printing this e-mail

    The information contained in this email is intended for the named recipient only. It may contain privileged material or information in confidence and if you are not the intended recipient you must not copy, distribute or take any action in reliance on it. If you have received this email in error, please notify me immediately by telephone or return email.

    Lets ignore all the below statements, the clowns at the MED know better … yeah right.

    http://odac-info.org/peak-oil-quotes
    Peak Oil Quotes
    Statements by key individuals
    2010

    Fatih Birol, Chief Economist of the International Energy Agency, September 2010 interviewed on BBC One Planet

    “It is definitely depressing, more than depressing, I would say alarming, which is what we try to do, to alarm the governments. In many OECD countries….oil consumption came to a peak and it is slowing down, but the growth of the demand is coming from China, the Middle East, India. So demand will grow. The question is, whether or not we will be able to increase the production to meet that demand growth. According to our projections in the World Energy Outlook, even if we were to assume, and this is very important, even if we were to assume the next 20 years global oil demand growth was flat, no growth at all, in order to compensate the decline in the existing fields we have to increase the production about 45m bpd just to stay where we are in 20 years, which means to find and develop 4 new Saudi Arabias, and this is a major challenge.

    If we look at the theoretical potential that we have conventional and unconventional oil, then maybe we have a possibility to meet that challenge. But there are tremendous challenges.” View reference

    Rebuilding Security – Conservative Energy Policy for and Uncertain World, March 2010 “The last two years have seen extraordinary volatility in the global price of oil. Prices have swung from $147 a barrel in July 2008 to $32 a barrel in December of the same year, and by the end of 2009 prices were back up to between $70 and $80 a barrel – despite the impact of the recession. With most economies now in recovery there are fears of further pressure on prices. As the Industry Taskforce on Peak Oil and Energy Security (consisting of leading companies from the power, engineering and transport sectors) warned this year: “The era of cheap oil is behind us. We must plan for a world in which oil prices are likely to be both higher and more volatile.”” View reference

    The US Joint Operating Environment 2010 report, February 2010 “By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD.” View reference

    Chris Barton, Department of Energy and Climate Change (DECC), February 2010 – “We don’t have a firm view on what the future holds for oil supply and demand but we do recognise the risks” View reference

    Thierry Desmarest, Chairman of the Board at Total SA, January 28th, 2010 – “The problem of peak oil remains. We have always been relatively prudent in our assessment of a peak oil date in Total between, I would say, the International Energy Agency which was extremely optimistic a few years ago – a bit less today – and some so called experts who were announcing that the peak oil has already taken place. In our opinion it will be very difficult to raise the oil production above 95 million barrels/day, which is something like 10% above today’s level – so its not enormous. Its not that we lack reserves, there are plenty of oil to produced but a lot of it is difficult to be produced. Huge resources like the Athabasca oil sands for instance – when you look to the newsflow of the last 2 or 3 years you have just seen a lot of postponements of projects, not that much because of lack of profitability of projects but also with environmental concerns, as an example among others. So I think we must keep in mind that in a few years from now the market may be in a relatively difficult position in, the energy security concerning oil (because I think for gas we have certainly more time), will be a big problem.”
    2009

    Andrew Sentance, member of the Bank of England’s Monetary Policy Committee, September 2009 – “On the energy front, I can see substantial upside risks to prices over the coming recovery as demand picks up across the global economy and Asia plays a leading role in the growth of the world economy. Against the background of supply constraints, this creates the potential for continuing price volatility. I do not see supply developments and environmental policy moves changing the energy price environment which became established in the mid-2000s until much later in the next decade.” View reference

    Iain Reid, Head of European Oil and Gas research at Macquarie Bank, September 2009 – “This is our view – capacity has pretty much peaked in the sense that declines equal new resources,” View reference

    Christophe de Margerie, CEO of Total, September 2009 – “We are running the risk of another oil crisis when demand outstrips supply around 2014 or 2015. There won’t be enough oil and gas by the middle of the next decade.” View reference

    Fatih Birol, Chief Economist of the International Energy Agency, August 2009 – “Many governments now are more and more aware that at least the day of cheap and easy oil is over… [however] I’m not very optimistic about governments being aware of the difficulties we may face in the oil supply,” View reference

    Vince Cable, Lib Dem Shadow Chancellor of the Exchequer, June 2009 – “Long-term thinking is difficult in the current political crisis, when most politicians are obsessed by tomorrow’s headlines,…but our future as a country depends much more on our ability to plan ahead for the next oil shock and the post-oil world.” View reference

    Andris Piebalgs, EU Energy Commissioner, May 2009 “The current relatively low oil prices give a respite to prepare for the coming new oil crisis. We have to reduce our dependency in all those areas in which black gold is not indispensable… And in all sectors, we have to accelerate our efficiency being aware that every barrel of oil that we are using is one of the last.” View reference

    Christophe de Margerie , CEO Total, February 2009 The world will never be able to produce more than 89m barrels a day of oil, the head of Europe’s third-largest energy group has warned, citing high costs in areas such as Canada and political restrictions in countries such as Iran and Iraq. Christophe de Margerie, chief executive of Total, the French oil and gas company, said he had revised his forecast for 2015 oil production downward by at least 4m barrels a day because of the current economic crisis and the collapse in oil prices. View reference
    2008

    Katsuaki Watanabe, President, Toyota– June 2008 “Our view is that oil production will peak in the near future. We need to develop power train(s) for alternative energy sources.” View reference

    T. Boone Pickens, Chair BP Capital Management hedge fund – 17th June 2008 “I do believe we have peaked out at 85 million barrels a day globally,” View reference

    Shokri Ghanem – head of Libya’s National Oil Corporation, 8th June 2008 “The easy, cheap oil is over. Peak oil is looming” View reference

    Jeroen van de Veer – CEO of Shell, 22nd January 2008 “Shell estimates that after 2015 supplies of easy-to-access oil and gas will no longer keep up with demand.” View reference

    Rick Wagoner – ex GM Chairman and Chief Exec, at the Detroit Motor Show, 13th January, 2008 “There is no doubt demand for oil is outpacing supply at a rapid pace, and has been for some time now,…As a business necessity and an obligation to society we need to develop alternative sources of propulsion.” View reference

    Dave O’Reilly – Chevron, 15th February 2008, “We’re seeing the beginnings of a bidding war for Middle Eastern oil between east and west,” View reference

    Fatih Birol – IEA, writing in The Independent 2nd March 2008 – “We are on the brink of a new energy order. Over the next few decades, our reserves of oil will start to run out and it is imperative that governments in both producing and consuming nations prepare now for that time. We should not cling to crude down to the last drop – we should leave oil before it leaves us. That means new approaches must be found soon….. The really important thing is that even though we are not yet running out of oil, we are running out of time.” View reference

    George W. Bush, March 5th 2008 “We gotta get off oil, American has got to change its habits,”.. “It should be obvious to all, demand has outstripped supply, which makes prices go up.” View reference

    James W. Buckee -Retired President and CEO of Talisman Energy Inc., 29th January 2008. “If you think that at the moment the world is consuming 30-plus billion barrels a year of oil and is finding seven or eight billion barrels a year, and this state of affairs has been going on now for 20 or more years. “It’s obviously unsustainable and the world is increasingly drawing on the bigger, older fields. You couple that notion with the irreversibility of decline and you’ve got a very alarming picture.” View reference

    Jeremy Leggett and Shell – Advertisement appeared in Time Europe Edition, one of the CNN Principal Voices series, 31st March 2008 “A premature topping point in global oil production would wipe out economic plans currently on offer in boardrooms and finance ministries around the world. This is because such plans assume growing supplies of affordable oil for several decades to come.“ View reference
    2007

    Sadad al-Huseini – former head of exploration and production at Saudi Aramco, 31st October, 2007 “The evidence is that in spite of the increases – very large increases – in oil prices over the last four years, we haven’t been able to match that with increasing capacity. So, essentially, we are on a plateau.” View reference

    Christophe de Margerie – CEO Total, 30/31st October 2007. “100m barrels per day is now in my view an optimistic case…” View reference

    Fatih Birol – IEA, interviewed in Le Monde, June 2007 “From now to 2015, the market and the oil industry will be severely tested. In the next five to ten years, oil production from non-OPEC producers will reach a peak before starting to decline, for lack of sufficient reserves. As each day passes, new evidence of this fact appears. At the same time the peak of the economic expansion phase of China will take place. The two events will coincide: the explosion of the growth of the Chinese demand, and the fall in production of non-OPEC oil. Will our oil system be it able to answer this challenge, that is the question.” “If production does not increase in Iraq in an exponential way between now and 2015, we have a very big problem, even if Saudi Arabia meets its obligations. The figures are very simple, you do not need to be an expert. It is enough to know how to do a subtraction. China will grow very quickly, India also, and even Saudi Arabia projections of the 3 Mb/day will not be enough to meet the rise of Chinese demand.” View reference

    Lord Oxburgh- former CEO of Shell, September 2007 “…you’ve got three main variables: rising world demand, and it’s a bit hard to predict exactly how fast that is going to rise; how much oil is going to be available; and how fast substitutes for oil come to market (synthetic fuels can be made in quite a number of ways). But all of that said I don’t think this is going to happen in the next five years, and I would be surprised if the difficulties ahead had not really emerged within the next twenty.”

    “The message in short is that we are just about to enter hot water, quite serious hot water. And the danger is that we sit there blissfully like the frog in the pan of water gently heating on the stove until – as the Irish would say – it wakes up to find itself dead. In other words we may be sleepwalking into a problem which is actually going to be very serious and that it may be too late to do anything about it by the time we are fully aware.” View reference
    2005

    Dr. James Schlesinger – former US Energy Secretary, 16th November 2005 “In the longer run, unless we take serious steps to prepare for the day that we can no longer increase production of conventional oil, we are faced with the possibility of a major economic shock—and the political unrest that would ensue.” View reference

    Dave O’Reilly – CEO, Chevron in their Real Issues Ad, 12th July 2005 “Energy will be one of the defining issues of this century. One thing is clear: the era of easy oil is over. What we all do next will determine How well we meet the energy needs of the entire world in this century and beyond.” “It took us 125 years to use the first trillion barrels of oil. We’ll use the next trillion in 30.“ View reference
    References from the press
    2010

    The Financial Times, 21st April, 2010 “Are policymakers, economists and peak oilists starting to speak the same language? A rash of papers, comments and interviews have made us think this recently. It’s not as simple as ‘policymakers are waking up to peak oil’, but that all those groups — and indeed, industry — are increasingly talking about the same issues looming in fossil fuel production, even if they’re using different terminology.” View original article
    2008

    The Independent Lead Article, 28th April 2008 “In the broader context, this crisis must be seen as part of the global energy squeeze. It has been clear for some time that global demand for oil has been outstripping supply. That is what is pushing up prices around the world. That a relatively minor industrial dispute such as this can have such a knock-on effect demonstrates how dependent Britain is on a relatively small number of supply outlets. The Grangemouth dispute will eventually, no doubt, be settled, but the chronic crisis of our economy’s total reliance on environmentally damaging and dwindling oil supplies will continue.” View original article

    Financial Times Lead Article, 17th April 2008 “Preparing for the age of peak oil – Russia’s vast oil and gas reserves were seen not so long ago as the best hope of meeting growing world energy demand. No more. This week a top Russian oil executive echoed earlier official warnings that oil production could fall for the first time in a decade.” View original article
    2007

    Independent, 17th September 2007 “Oil Industry ‘Sleepwalking into crisis’ – Former Shell chairman says that diminishing resources could push price of crude to $150 a barrel’ View original article

    CNNMoney.com – 7th August 2007 “Why oil won’t hit $100 – New production, new energy sources and some conservation could push down prices by 2010 – but don’t expect $20 a barrel anytime soon.” View original article

    William Rees Mogg, The Times, 16th July 2007 “Oil ruled the 20th century; the shortage of oil will rule the 21st. There is now no doubt about the rising trend of oil prices.” View original article

    Financial Times, 10th July 2007 “World will face oil crunch in five years – IEA says supply falling faster than expected.” View original article

    The information in this email (including attachments) is confidential and may be legally privileged. If an addressing transmission error has misdirected this email, please notify the author by replying to this email and destroy the message. If you are not the intended recipient, any use, disclosure, copying or distribution is prohibited and may be unlawful.

    The information in this email (including attachments) is confidential and may be legally privileged. If an addressing or transmission error has misdirected this email, please notify the author by replying to this email and destroy the message. If you are not the intended recipient, any use, disclosure, copying or distribution is prohibited and may be unlawful.

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  11. Permaculture Research Institute of Australia » Peak Oil – “The Debate is Over
    http://permaculture.org.au/2010/11/10/peak-oil-the-debate-is-over/
    Peak Oil – “The Debate is Over”
    Consumerism, Economics, Food Shortages, Society, peak oil — by Craig Mackintosh November 10, 2010

    It’s been a long time coming, but the uber-significant Peak Oil issue has finally started to infiltrate the corridors of power. What they’ll do with this information remains to be seen….

    There is no reason for optimism. — Dr. James Schlesinger (former Secretary of Defence and the U.S.’s first Secretary of Energy)

    I made mention recently of the leaked German Military Peak Oil study (German PDF here, key points summarised in English here) which looked at the Peak Oil issue from a national security standpoint. Now the New Zealand government has created their own study — releasing it publicly, rather than forcing some conscientious and concerned person to have to sneak it out the back door.

    The summary findings of the study are almost word-for-word with what I wrote a long time ago (here and here for example).

    Although there remain large reserves of oil which can be extracted, the world’s daily capacity to extract oil cannot keep increasing indefinitely. A point will be reached where it is not economically and physically feasible to replace the declining production from existing wells and add new production fast enough for total production capacity to increase. Projections from the IEA and other groups have this occurring, at least temporarily, as soon as 2012.

    The difference between the global capacity to produce oil and global demand is the supply buffer. When the supply buffer is large, oil prices will be low. When the supply buffer shrinks – due to demand rising faster than production capacity or production capacity falling – prices will rise as markets add in the risk that supply will not be available to meet demand at any given point in time.

    When a supply crunch forces oil prices beyond a certain point, the cost of oil forces consumers and businesses to cut other spending, inducing a recession. The recession destroys demand for oil, allowing prices to drop. Major international organisations are warning of another supply crunch as soon as 2012.

    The world may be entering an era defined by relatively short periods of economic growth terminating in oil price spikes and recession.

    New Zealand is not immune to the consequences of this situation. In fact, its dependency on bulk exports and tourism makes New Zealand very vulnerable to oil shocks. — The Next Oil Shock? Parliamentary Library Research Paper (emphasis added)

    What we’re talking about is, quite simply, perpetual recession:

    There is a risk that the world economy may be at the start of a cycle of supply crunches leading to price spikes and recessions, followed by recoveries leading to supply crunches. — The Next Oil Shock? Parliamentary Library Research Paper
    END SNIP

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    No Right TurnBy Idiot/Savant
    1 week ago
  • Retailing of vaping products – New NZ Research
    Dr Lindsay Robertson, Dr Jerram Bateman, Professor Janet Hoek Members of the public health community hold divergent views on how access to vaping products or electronic nicotine delivery systems (ENDS) products should be arranged. Some believe ENDS should be as widely available as smoked tobacco and argue for liberal ...
    SciBlogsBy Public Health Expert
    1 week ago
  • Justice for Bomber
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    No Right TurnBy Idiot/Savant
    1 week ago
  • Britain’s climate tyranny was unlawful
    Last month, in response to a wave of protests by Extinction Rebellion, the British government purported to ban their protests from the whole of London. It was a significant interference with the freedoms of expression and assembly, and another sign of the country's decline into tyranny. But now, a court ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • More crime from the spies
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    No Right TurnBy Idiot/Savant
    1 week ago
  • Vaccination, compulsion, and paternalism for the lower orders
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    SciBlogsBy Eric Crampton
    1 week ago
  • Global Protests Rage On: But Slogans Are Not Plans.
    Feeding The Flames: It is simply not enough to demand an end to “corruption”, or “inequality”, or the overbearing influence of the authorities in Beijing. These are just “lowest common denominator” demands: the sort of slogans that pull people onto the streets. They are not a plan.WHERE’S THE PLAN? Across ...
    1 week ago
  • 11,000 employed under Labour
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    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Boycott this democratic fraud
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    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Why Mars is cold despite an atmosphere of mostly carbon dioxide
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    SciBlogsBy Guest Author
    2 weeks ago
  • Climate Change: Ban private jets
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    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Climate Change: Untold Suffering
    That's what we face if we don't stop climate change, according to a warning from 11,000 scientists:The world’s people face “untold suffering due to the climate crisis” unless there are major transformations to global society, according to a stark warning from more than 11,000 scientists. “We declare clearly and unequivocally ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • The left and violent misogyny
    by Phil Duncan Here’s just a few of the kind of threats issued day in and day out against gender-critical women – feminists, marxists, etc – overwhelmingly by MEN (albeit men identifying as women). “Kill all Terfs”. “Shoot a Terf today”. “All terfs deserve to be shot in the head”. ...
    RedlineBy Admin
    2 weeks ago
  • Imperialism and the iPhone
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    RedlineBy Admin
    2 weeks ago
  • The freshwater mussel housing crisis: eviction by invasive weeds?
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    SciBlogsBy Guest Author
    2 weeks ago
  • Back it up Luxon: endorsing the destructive past is not actually the way forward
    And to think he gave all the potential goodwill away with that moronic, cult-like statement (repeated ad nauseam by many National hardliners) that Key is quite simply “the greatest PM we ever had”… Installation complete: this was nothing ...
    exhALANtBy exhalantblog
    2 weeks ago
  • Good riddance
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    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Climate Change: D-Day
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    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Winston is right
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    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Media impartiality
    Sky's economics editor, Ed Conway has posted a Twitter thread responding to a claim that - as far as I can see - Labour never made:
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    2 weeks ago
  • Finish what’s on your plate
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    SciBlogsBy Genomics Aotearoa
    2 weeks ago
  • Gainful Employment: A Cautionary Tale.
    Transformative Politics: The idea is to turn each recipient into an unwitting accomplice in their own transformation. From interested observer to hyped-up activist, sharing our messages promiscuously with ‘friends’. You’ll be part of an ever-expanding circulatory system, Jennifer, for the ideas that will win us the election.”JENNIFER SKITTERED her chair ...
    2 weeks ago
  • New Zealand should not fund bigotry
    Two years ago, the Cook Islands government announced that it was planning to join the civilised world and decriminalise consensual homosexual sex between men. Now, they've reversed their position, and decided to criminalise lesbians into the bargain:Two years ago, in a step welcomed by many people including the gay and ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • New Fisk
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • More tyranny in Australia
    The boycott is a fundamental tool of protest. By choosing who we buy from, we can send a message, and hopefully change corporate behaviour. Historically, boycotts have been effective, for example over apartheid in South Africa and Israel, in forcing divestment from Myanmar, and in ending bus segregation in the ...
    No Right TurnBy Idiot/Savant
    2 weeks ago

  • Kiwis to have their say on End of Life Choice
    Jenny Marcroft MP, Spokesperson for Health New Zealand First backs the public to decide on the End of Life Choice Bill via a referendum at the 2020 General Election. The Bill, with New Zealand First’s referendum provision incorporated, passed its final reading in Parliament this evening. New Zealand First Spokesperson for ...
    3 days ago
  • Addressing miscarriages of justice
    Darroch Ball, Spokesperson for Justice New Zealand First is proud that a key Coalition Agreement commitment which will provide for a more transparent and effective criminal justice system has been realised. Legislation to establish the Criminal Cases Review Commission, an independent body focused on identifying and responding to possible miscarriages of ...
    4 days ago
  • Week That Was: Historic action on climate change
    "Today we have made a choice that will leave a legacy... I hope that means that future generations will see that we, in New Zealand, were on the right side of history." - Jacinda Ardern, Third Reading of the Zero Carbon Bill ...
    1 week ago
  • Tax-free deployments for Kiwi troops
    Darroch Ball, New Zealand First List MP A Member’s bill has been proposed that would provide income tax exemptions for all New Zealand Defence Force (NZDF) personnel while on operational deployment overseas. The Income Tax (Exemption for Salary or Wages of NZDF Members on Active Deployment) Amendment Bill proposed by New Zealand First ...
    1 week ago
  • A balanced Zero Carbon Bill passed
    Rt Hon Winston Peters, New Zealand First Leader New Zealand First is proud to have brought common sense to the Climate Change Response (Zero Carbon) Amendment Bill, which passed its final reading in Parliament today. Party Leader Rt Hon Winston Peters says months of hard work went into negotiating a balanced ...
    1 week ago
  • Paramedics’ status to be recognised
    Jenny Marcroft MP, Spokesperson for Health New Zealand First has listened to calls to recognise paramedics as registered health professionals under the Health Practitioners’ Competence Assurance Act (the Act). Today, the Coalition Government announced plans for paramedics to be registered as health practitioners under the Act, and the establishment of a ...
    2 weeks ago
  • Week That Was: 2,000 teachers in two years
    We began the week by commemorating the New Zealand Wars and celebrating a major increase in the number of teachers. Then, we were busy supporting offenders into work and getting our rail back on track after years of underinvestment. And that's just the start! ...
    2 weeks ago
  • Winning an election one conversation at a time
    In October I was sworn in as the Mayor of Lower Hutt. It’s the privilege of my life to serve Hutt people as their Mayor. There is something really special to be able to serve the community where I was raised, and where I live.   ...
    2 weeks ago
  • Closer cooperation with Korean horse racing industry
    Rt Hon Winston Peters, Deputy Prime Minister, Minister for Racing Racing Minister Winston Peters met with Korea Racing Authority Chairperson Nak Soon Kim in Seoul today to discuss closer cooperation between the New Zealand and Korean horse racing industries. As part of the visit to the Seoul Racecourse, Mr Peters witnessed ...
    3 weeks ago
  • Otago to lead digital creativity
    Hon Shane Jones, Minister for Regional Economic Development The Provincial Growth Fund (PGF) is investing $10 million to establish Otago as the centre of New Zealand’s creative digital industry over the next ten years, Regional Development Minister Shane Jones announced today. “The initiative will bring us closer to the vision of ...
    3 weeks ago
  • Young Otago students encouraged to take on forestry careers
    Hon Shane Jones, Minister for Regional Economic Development The Provincial Growth Fund (PGF)’s skills and employment programme will help young Otago people into long-term forestry careers, Regional Economic Development Minister Shane Jones announced today. Te Ara Mahi will invest $63,000 in the 2020 school year to support eight 17 and 18 ...
    3 weeks ago
  • PGF backing Dunedin’s waterfront ambitions
    Hon Shane Jones, Minister for Regional Economic Development The Provincial Growth Fund (PGF) will support local plans to revitalise and stimulate economic development opportunities in Otago, Regional Economic Development Minister Shane Jones has announced. The four Regional Economic Development Ministers have approved an in-principle investment of $19.9 million towards the region’s ...
    3 weeks ago
  • M. Bovis eradication progress welcomed
    Mark Patterson, Spokesperson for Primary Industries New Zealand First is pleased to have received the Technical Advisory Group (TAG) report on the Coalition Government’s Mycoplasma bovis eradication efforts, which shows significant progress in the fight against the disease. New Zealand First Spokesperson for Primary Industries, Mark Patterson, says the report’s findings ...
    3 weeks ago
  • PGF boosts Otago’s engineering and manufacturing sector
    Hon Shane Jones, Minister for Regional Economic Development Hon David Parker, Minister for Trade and Export Growth The Provincial Growth Fund (PGF) is investing to support economic growth opportunities for Otago’s engineering and manufacturing sectors, Regional Development Minister Shane Jones and Trade and Export Minister David Parker announced today. Almost $20 million ...
    3 weeks ago
  • Minister Peters discusses Pacific challenges and denuclearisation in Seoul
    Rt Hon Winston Peters, Deputy Prime Minister, Minister of Foreign Affairs Foreign Minister Winston Peters and his South Korean counterpart, Kang Kyung-wha, discussed in Seoul today opportunities to work more closely in the Pacific and the situation on the Korean Peninsula. Mr Peters and Minister Kang confirmed New Zealand and the ...
    3 weeks ago
  • PGF supports high speed broadband for marae at Parihaka Pa
    Hon Shane Jones, Minister for Regional Economic Development  Hon Nanaia Mahuta, Minister for Māori Development The three marae in the historic Parihaka Pa complex in Taranaki have been upgraded to high speed broadband with the support of the Provincial Growth Fund (PGF), Regional Economic Development Minister Shane Jones announced today. “Connecting the ...
    3 weeks ago
  • Advancing Pacific Partnerships 2019 launched
    Hon Ron Mark, Minister of Defence Minister of Defence Ron Mark will today launch the Advancing Pacific Partnerships 2019 Defence Assessment  during a speech at Te Papa.  The Assessment outlines how Defence will partner with our Pacific Island neighbours and invest in Pacific regional security architecture. The Plan aligns with the Coalition ...
    3 weeks ago
  • PGF funding could transform Gisborne company into “beacon of employment” in two years
    A new Provincial Growth Fund investment could create about 80 new jobs in Gisborne over the next two years, turning a local small business into a “beacon of employment” in the process. Regional Economic Development Parliamentary Under-Secretary Fletcher Tabuteau said the PGF’s Te Ara Mahi funding stream would provide $1.6m ...
    3 weeks ago

  • Food industry asked to step up fight against obesity
         The Government is asking the food industry to step up work to tackle obesity including reducing sugar, fat and salt in their products, better information for consumers, and tighter restrictions on advertising to children. Health Minister David Clark and Food Safety Minister Damien O’Connor have responded to a ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Modern emergency care for Queenstown area
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    BeehiveBy beehive.govt.nz
    2 days ago
  • Contraception important for New Zealanders
    Associate Health Minister Julie Anne Genter says today’s release of sexual and reproductive health data reinforces the significance of the Government’s commitment to providing free or very low-cost contraception. The Ministry of Health today published statistics from the Ministry of Health’s 2014/15 Health Survey. “It is important people can make ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • NZ medical staff and measles vaccines going to Samoa
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    BeehiveBy beehive.govt.nz
    2 days ago
  • Disability Action Plan 2019 – 2023
    “The new Disability Action Plan 2019–2023 moves us towards the inclusive and accessible New Zealand that this government has committed to,” Minister for Disability Issues Carmel Sepuloni announced today.  “The Action Plan was designed by disabled people, their family and supporters, the disability sector and government agencies. It will ensure ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Joint Statement – Third Singapore-New Zealand Defence Ministers’ Meeting
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    BeehiveBy beehive.govt.nz
    3 days ago
  • Sexual Violence Legislation Bill has its first reading
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    BeehiveBy beehive.govt.nz
    3 days ago
  • Streamlined business invoicing a step closer
    Streamlined payment practices are a step closer for Kiwi businesses with the formal launch of New Zealand’s e-Invoicing framework. Small Business Minister Stuart Nash says the government has now established the structure to enable automated and direct data exchange between the accounting systems of buyers and sellers. “The move to ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • More frontline biosecurity officers protecting NZ
    Another 51 quarantine officers and four new biosecurity detector dog teams will help protect New Zealand from invasive pests and diseases this summer, says Biosecurity Minister Damien O’Connor. “The Government is delivering on its commitment to strengthen New Zealand’s biosecurity system and support our valuable primary sector “New Zealand’s flora, fauna ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • NZ space economy worth $1.69 billion
    A new report has found New Zealand’s space sector contributed $1.69 billion to the economy in the last financial year and employs 12,000 people, Minister for Economic Development Phil Twyford announced today. The report by Deloitte was commissioned by the Ministry of Business, Innovation and Employment and shows New Zealand ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • New Chair for Royal Commission into Abuse
    Judge Coral Shaw has been appointed as the new Chair of the Royal Commission into Historical Abuse in State Care and in the Care of Faith-based Institutions, Internal Affairs Minister Tracey Martin announced today. "Judge Shaw, who is currently one of the inquiry commissioners, is extremely well qualified for the ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Better mental health facilities for Palmerston North
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    BeehiveBy beehive.govt.nz
    3 days ago
  • Bowel Screening hits halfway point
    The roll out of the National Bowel Screening Programme has reached the halfway mark, with 10 out of 20 District Health Boards now part of the programme. MidCentral DHB, which covers Palmerston North, Manawatu and surrounding districts, this week became the latest to DHB to offer free bowel screening to ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • More vaccines for meningococcal disease
    The Government welcomes PHARMAC’s decision to fund a vaccine to protect young people from meningococcal disease from 1 December this year. “Meningococcal disease is a serious threat which people at higher risk should be protected from,” says Associate Health Minister Julie Anne Genter. “The combined pharmaceutical budget was increased by ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Fisheries innovation projects supported
    Groups involved with innovative fisheries research projects are encouraged to apply for government support in the latest funding round from the Sustainable Food and Fibre Futures programme. Fisheries Minister Stuart Nash says the SFF Futures funding is designed to be flexible enough to support small or large projects across a ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Government fixes culturally arranged marriage visa issue
    The Government has fixed an issue affecting how Immigration New Zealand has processed visa applications for culturally arranged marriages, which will now see a consistent process applied which ensures people with legitimate arranged marriages can visit New Zealand while also preventing any rorting of the system. Earlier this year Immigration ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Extension for Royal Commission into Mosque attacks
    The Royal Commission into the Attacks on Christchurch Mosques will report back on 30 April 2020 to give it more time to hear submissions and consider information, Internal Affairs Minister Tracey Martin announced today. The Royal Commission was originally scheduled to report back to Government by 10 December 2019. “There has ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Terrorism and Trade on agenda as Foreign Minister visits the United States
    Foreign Minister Winston Peters will travel to Washington DC today to attend a ministerial meeting focused on defeating ISIS, and to continue pursuing New Zealand’s trade opportunities. Mr Peters will participate in a meeting of Foreign and Defence Ministers from key countries contributing to the Global Coalition to Defeat ISIS. ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Hoiho get extra support alongside 168 community conservation groups backing nature
    The recently crowned Bird of the Year, the hoiho/yellow eyed penguin, is getting a much needed helping hand alongside more than 168 other community conservation projects announced Minister for Conservation Eugenie Sage today. 168 community conservation projects throughout New Zealand are benefiting from $8 million in government grants, including $500,000 ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • New safety measures for modified pistols
    Controls on assault rifles and semi-automatic firearms are to be broadened to include some types of pistols, under changes to a bill currently making its way through Parliament. Police Minister Stuart Nash has tabled a Supplementary Order Paper to the Arms Legislation Bill, which is currently before a Select Committee ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Minister of Defence to visit Singapore and Thailand
    Minister of Defence Ron Mark will travel to Singapore today to conduct a counterpart visit and to co-chair the third annual Singapore-New Zealand Defence Ministers’ Meeting with his counterpart, Minister for Defence Dr Ng Eng Hen. “Singapore is one of our most important defence partners in the region, and our ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Future secured for Salisbury School
    Nelson’s Salisbury School is to be rebuilt, creating a modern and suitable learning environment for students at the residential special school, Education Minister Chris Hipkins and Associate Education Minister Tracey Martin announced today. The school for girls aged 8-15, in Richmond, was earmarked for closure by National until the process ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Resource management reform options released
    The panel undertaking a comprehensive review of the Resource Management Act has identified the main issues to be addressed and options for reform and is calling for feedback to inform its final report.  In July the Government announced the comprehensive review of the resource management system, including the RMA - ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Criminal Cases Review Commission established
    An important safety valve has been added to New Zealand’s criminal justice system with the third reading of the Criminal Cases Review Commission Bill today. The Criminal Cases Review Commission (CCRC) will investigate claimed miscarriages of justice. “We’ve seen how our justice system can very occasionally get things spectacularly wrong, ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Racing Industry destined to be on-track
    Racing Minister Winston Peters welcomes the tabling of the Racing Industry Transition Agency (RITA) 2019 Annual Report in Parliament today. He says the 2019 Annual Report marks the point when New Zealand’s racing industry’s decline was arrested and a turnaround started. RITA’s 2019 Annual Report recorded an industry net profit ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • New Zealand firefighter support to Queensland
    The New Zealand Government is today sending 21 firefighters to help fight the ongoing catastrophic Australian bushfires. “The fires in Australia are in some of the toughest, most challenging conditions ever,” says Internal Affairs Minister Tracey Martin.  “As of yesterday morning, there were 100 active bushfire-related incidents across Queensland and ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Supporting all schools to succeed
      More frontline support for schools through a new education agency, as part of a redesigned Ministry of Education More support for principals and school boards including through a new centre of leadership and local leadership advisor roles New independent disputes panels for parents and students Management of school property ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Reform to support better outcomes for Māori learners and whānau
    The Government’s reform of the Tomorrow’s Schools system is a watershed moment in education and an opportunity to create meaningful change for ākonga Māori and their whānau, Associate Education Minister Kelvin Davis said today. “Last year through Kōrero Mātauranga | Education Conversation, Māori teachers, parents, ākonga, whānau, hapū and iwi ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Infrastructure pipeline growing
    Infrastructure Minister is welcoming the first of many updated project pipelines from the newly established New Zealand Infrastructure Commission today. The New Zealand Infrastructure Commission, Te Waihanga, has released an expanded pipeline of major capital projects – another crucial step towards delivering better infrastructure outcomes. “The first iteration of the ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Tighter firearms law to further improve safety
    Tougher gun laws designed to improve public safety through firearms prohibition orders are proposed in a new document released for public input. Police Minister Stuart Nash says firearms prohibition orders (FPOs) would give new powers to Police to ensure high-risk individuals come nowhere near firearms. “We have already prohibited the ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • New TVNZ chair & directors confirmed
    Andy Coupe has been confirmed as TVNZ’s new Board Chair. “Mr Coupe has strong commercial and capital markets experience and TVNZ has benefited from his technical knowledge of business and finance, as well as his extensive governance experience,” the Minister of Broadcasting, Communications and Digital Media Kris Faafoi said.  Andy ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Hutt Road cycle path officially opened
    Associate Minister of Transport Julie Anne Genter today officially opened a separated pathway, following the completion of the Kaiwharawhara Stream bridge, which will improve safety for cyclists and pedestrians along Hutt Road.  The $6.8m Hutt Road project provides a separated path for cycling and pedestrians, the replacement of informal parking ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Announcement of new Ambassador to Russia
    Foreign Affairs Minister Winston Peters today announced the appointment of career diplomat Si’alei van Toor as New Zealand’s next Ambassador to Russia. “I’m pleased to appoint Ms van Toor to this position. She brings a wealth of experience to the role having previously served as Senior Trade Adviser to the ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Half Year Economic and Fiscal Update
    The Treasury’s 2019 Half Year Economic and Fiscal Update (HYEFU) will be released on Wednesday December 11, Finance Minister Grant Robertson says. The Coalition Government will publish the 2020 Budget Policy Statement at the same time, outlining the priorities for Budget 2020. Further details on arrangements for the release will ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Giving a Boost to Kiwi small businesses
    A new initiative to better support small businesses through hands-on mentoring and advice has been launched by the Minister for Small Business. The first event in the Kiwi Business Boost series of regional workshops and online tools has been launched in Wairoa by Stuart Nash. “The Business Boost initiative combines ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Nearly three quarters of Rolleston connected to UFB
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    BeehiveBy beehive.govt.nz
    1 week ago
  • Historic day for landmark climate change legislation in New Zealand
    The passing of the Climate Change Response (Zero Carbon) Amendment Bill will help ensure a safe planet for our kids and grandkids, the Minister for Climate Change James Shaw said today. The landmark legislation which provides a framework to support New Zealanders to prepare for, and adapt to, the effects ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Release of Oranga Tamariki Practice Review
    The review of Oranga Tamariki practice around the planned uplift of a Hastings baby in May shows significant failings by the Ministry and that the planned and funded changes to shift from a child crisis service to a proper care and protection service need to be accelerated, Children’s Minister Tracey ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Minister wishes students success in exams
    Education Minister Chris Hipkins has wished students the best of luck for this year’s NCEA and New Zealand Scholarship exams which start tomorrow. Around 140,000 students will have participated in 119 NCEA and New Zealand Scholarship exams by the end of the exam period on 3 December. “I want to ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New High Commissioner to the United Kingdom announced
    Foreign Affairs Minister Winston Peters today announced the appointment of Bede Corry as New Zealand’s next High Commissioner to the United Kingdom. “The appointment of a senior diplomat to this important role underlines the significance New Zealand places on our relationship with the United Kingdom,” said Mr Peters. “The United ...
    BeehiveBy beehive.govt.nz
    1 week ago