Stories from the Financial Times...

not necessarily available via free online access.

1. Headline in the Tuesday paper... "World will face oil crunch 'in five years'" reporting from the world fuel outlook by the International Energy Agency. From the article:

The world is facing an oil supply "crunch" within five years that will force up prices to record levels and increase the west's dependence on oil cartel Opec, the industrialised countries' energy watchdog has warned. In its starkest warning yet, the International Energy Agency said "oil looks extremely tight in five years time" and there are "prospects of even tighter natural gas markets at the turn of the decade"...

Rex Tillerson, the chairman and chief executive of ExxonMobil, said recently that he thought non-Opec oil production was close to levelling off. He told the FT: "We still see capacity for a little more growth, but pretty modest, and then in our own energy outlook it begins to plateau. And that results then in this call on Opec."

2. Article in the Saturday paper, "Shenzhen citizens urged to stop buying cars." From the article:

The government has given enthusiastic encouragement to the car industry, whichit views as a pillar for the economy over the next two decades. However, in recent years a number of cities - most notably Beijing, the capital - have begun to suffer heavy congestion and pollution far above World Health Organisation guidelines as a result of increased traffic.

Officials in some cities have begun to worry that vehicle- related smog will deter investment. The problems related to car ownership could just be starting. Despite the already huge size of the market, only about 2 per cent of Chinese citizens own a car - around one-thirtieth of US and European levels.

3. From the Saturday Lex Column, "Chinese cars,":

But investors in Chinese carmakers need not panic. China is not about to flash a red light at the industry it has spent decades nurturing to national champion status. Auto manufacturing is a big source of investment and jobs. In spite of some flirting with various strategies to constrain traffic flows, Shanghai is the only city where related administrative measures are in place. (Its chosen weapon, auctioning licence plates for up to Dollars 5,000, is pretty draconian - in some cases, that doubles the cost of car ownership.)

Instead, China is likely to tackle the pollution issue through emissions standards and by building public transport, the lack of which is one reason that so many are jumping behind the wheel. Neither of these is a quick fix. China had been powering ahead on emissions standards, aiming to introduce Euro III-standard engines to reduce carbon dioxide this year, and Euro IV ahead of the 2008 Olympics. But that timetable does not take into account the country's low-quality fuel. The oil companies reckon it will take several years and some hefty investment to start producing the low- sulphur petrol needed to run Euro III engines effectively.

4. Tuesday column, "The world has two energy crises but no real answers" by Gideon Rachman:

The world is, in fact, facing two energy crises. The first is rooted in scarcity and traditional power politics. It involves the struggle by the world's largest and most energy-hungry economies to get hold of the natural resources they need. Just yesterday the International Energy Agency warned that the world oil market would be "extremely tight" over the next five years. Demands from China and other emerging economies are rising. But Mary Kaldor - co- author of a new book called Oil Wars (Pluto) - points out the struggle to find new oil is a familiar sort of conflict, reminiscent of the 19th century "great game" or earlier imperial clashes.

The second energy crisis is new. It is driven by climate change. It demands international co-operation rather than competition. While the first crisis leads politicians and businessmen to search out ever more oil and gas, the second demandsthat they radically reduce their economies' dependence on hydrocarbons....

The US has its own energy dilemma. It accounts for 25 per cent of the world's oil consumption, but around 9 per cent of world oil production and 2 per cent of world oil reserves. America's demand for hydrocarbons keeps rising and the economy is still utterly dependent on the stuff - 97 per cent of the US transport system is fuelled by oil.

5. From Friday, "Improve energy efficiency and demand will fall," a letter to the editor by Caroline Lucas,Green Party, South-East England,and a Member of the European Parliament:

Sir, Gideon Rachman is exactly right to highlight our economic vulnerability to unprecedented oil prices caused by both dwindling supplies and the increasing imperative to cut the carbon dioxide emissions that are fuelling climate change ("The world has two energy crises but no real answers", July 10). But nowhere in his article does he even mention one of the most glaringly obvious solutions: improved energy efficiency leading to reduced demand for energy.

According to the European Union's own figures, for example, 40 per cent of Europe's existing primary demand for energy could be met through the implementation of energy efficiency measures using existing technologies. To achieve that, however, individual actions alone won't be enough: we need the government and the EU to adopt higher energy efficiency standards on the whole range of goods and appliances, coupled with serious investment in decentralising our electricity supply, which would save much of the two-thirds of energy capacity we currently waste through transmission losses and escaping heat.

6. And not in the FT, but the reality is the necessity of focusing on urban form and the link between walkability, proximity, and automobile independence.