NewBase 08 January 2024 Energy News issue - 1688 by Khaled Al Awadi.pdf

Copyright © 2024 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
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NewBase Energy News 08 January 2024 No. 1688 Senior Editor Eng. Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
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Dubai's Dragon Oil expands Turkmenistan investment with
development of three more fields
The National - Alvin R Cabral
Dubai's Dragon Oil, a subsidiary of Emirates National Oil Company, has expanded its investment
in Turkmenistan's oil and gas industry. The preliminary agreement signed between Dragon Oil and
state-owned Turkmenistan Oil includes increasing production with three new fields within
Turkmenistan's Block 19 offshore area, Dragon Oil said on Saturday.
ww.linkedin.com/in/khaled-al-awadi-80201019/

Dragon Oil did not disclose the value of the investment. The company, however, said it had
conducted a seismic survey in the three fields at a cost of $35 million, the results of which were
“promising”.
The fields are close to the Cheleken Contract
Area, which is an oil-producing field in the
Caspian Sea. “Turkmenistan is a very important
oil country and has large oil and gas
capabilities,” Ali Al Jarwan, chief executive of
Dragon Oil, said in the statement.
“We are seeking to strengthen our presence
there through new investments that will reflect
positively on both parties enhancing the state’s
income from revenue and creating new jobs.”
Turkmenistan is one of the five Caspian Sea
littoral countries, which is an area with large
volumes of oil and natural gas reserves.
The country had more than 600 million barrels of
proven oil reserves and 19.5 trillion cubic metres
of proven natural gas reserves at the end of 2020, latest data from the BP Statistical Review of
World Energy had shown.
Oil production in the country stood at 216,000 barrels a day in 2022, according to the US
International Trade Administration. Turkmenistan is also rich in hydrocarbon resources, having
produced about 80 billion cubic metres of natural gas in 2022, with half going to export, mostly to
China, ITA data showed.
The country consumes roughly 60 per cent of its oil production domestically and exports the
remainder over the Caspian Sea, the ITA said. Dragon Oil's new expansion plans in Turkmenistan
extend partnerships between the two sides.
In 2022, Dragon Oil signed an agreement with state-owned Turkmen Oil to extend their partnership
for another 10 years. Under that $1 billion renewed partnership, which begins in May 2025, Dragon
Oil will pay $500 million in cash, with the remaining half spread out over the next 13 years.
At the time, Dragon Oil has invested about $8.1 billion in well drilling and production infrastructure
over its then 22 years in Turkmenistan, achieving a cumulative production of 437 million barrels of
crude oil.
Dragon Oil has also continued to build up its international portfolio. This week, the state-owned
company announced that it has started crude oil production from the Al Wasl field, its first oil
discovery in Egypt.
The Al Wasl field, discovered in 2021, has an oil reserve of more than 95 million barrels and Dragon
Oil started the project with plans for “early production” with a total investment of $200 million, it said.
The project includes establishing an offshore production platform and extending a production line
and an electricity line to operate oil production pumps, Dragon Oil said.
Dragon Oil also plans to expand its presence in the Egyptian market this year by stepping up
exploration and expansion efforts in various regions, enhancing field development initiatives, and
undertaking well restoration to augment oil production in the Gulf of Suez fields. Dragon Oil, an
upstream oil and gas exploration, development and production company, also operates in Iraq.

DEWA's energy storage tech enhances Dubai's energy security
Arabia Trade + NewBase
Dubai Electricity and Water Authority (DEWA) is one of the leading organisations in adopting the
latest and best technologies for storing clean energy, and several of its energy storage projects are
among the largest regionally and globally, reported Emirates News Agency (WAM).
Reliance on clean and renewable energy sources, especially solar power, is increasing. This is
driven by their low cost, in light of the global direction to combat the effects of climate change by
reducing gas emissions that cause global warming.
The main challenge is the efficient storage of this energy to ensure it is available when there is no
sunlight or in different weather conditions, emphasising the importance of energy storage
technologies.
Saeed Mohammed Al Tayer, MD CEO of DEWA, stated, “We follow the vision and directives of His
Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of
Dubai, to ensure energy security and sustainability.
Energy storage is a vital aspect in ensuring energy sustainability and increasing the reliance on
clean and renewable energy sources. In addition to our energy storage projects that are completed
or in progress, we plan on establishing a wide-range energy storage system using electric batteries
that are supplied with photovoltaic energy at the Mohammed bin Rashid Al Maktoum Solar Park.

We also have a roadmap and a strategy for green hydrogen that will be implemented in phases.
This supports the Dubai Clean Energy Strategy 2050 and the Dubai Net Zero Carbon Emissions
Strategy 2050 to provide 100 percent of the energy production capacity from clean energy sources
by 2050."
In December 2023, His Highness Sheikh Mohammed bin Rashid Al Maktoum inaugurated the
950MW fourth phase of the Mohammed bin Rashid Al Maktoum Solar Park. This project will provide
approximately 320,000 residences with clean energy, and it will reduce carbon emissions by about
1.6 million tonnes annually.
The fourth phase of the Solar Park,
the largest single-site solar park in
the world, uses three hybrid
technologies to produce clean
energy: 600MW from a parabolic
basin complex, 100MW from the
solar power tower, and 250MW from
photovoltaic solar panels.
Built at an investment of AED15.78
billion, using the independent power
producer (IPP) model, the project
features the tallest solar tower in the
world, at 263.126 metres, and the
largest thermal energy storage
capacity with a capacity of 5,907-megawatt hours (MWh), according to the Guinness World
Records.
The process of thermally storing solar energy in molten (liquified) salt uses heliostats to concentrate
sunlight on the solar tower, then pumping the molten salt to the steam generator, which heats the
water and turns it into steam capable of moving the turbines of the electricity generator, allowing the
production of electricity round the clock.
Molten salt is a mixture of two or three salts, such as sodium nitrate, potassium nitrate, and calcium
nitrate. Molten salt has many properties that make it ideal for use in solar thermal power plants,
such as high boiling point, low viscosity, and low evaporation pressure.
DEWA is implementing a pumped-storage hydroelectric power plant in Hatta. The hydroelectric
power station will utilise water from the Hatta Dam and a newly constructed upper reservoir in the
mountains.
During off-peak hours, sophisticated turbines will use clean energy generated at the Mohammed
bin Rashid Al Maktoum Solar Park to pump water from the dam to the upper reservoir.
This is converted to kinetic energy during the water flow through the 1.2-kilometre subterranean
tunnel, and this kinetic energy rotates the turbine and converts mechanical energy to electrical
energy.
This system boasts high efficiency in power generation and storage, reaching up to 78.9 percent,
with a rapid 90-second response to electricity demand. The 250MW station will have a storage
capacity of 1,500 MWh and a life span of 80 years. It is the first of its kind in the GCC region.

Generators are currently being assembled, and the construction of service and operational facilities
is ongoing. The water upper intake structure and the associated bridge in the upper dam has been
completed.
Construction of the 72-metre main Roller Compacted Concrete (RCC) wall of the upper dam has
been completed, and preliminary measures to commence filling the upper dam have begun.
The 1.2-kilometre-long water tunnel is presently being linked to the power generators. With
investments of up to AED 1.421 billion, the project is planned for completion in Q1 of 2025.
DEWA has implemented a pilot Green
Hydrogen Project at the Mohammed bin
Rashid Al Maktoum Solar Park. This is the first
project of its kind in the Middle East and North
Africa to produce green hydrogen using solar
energy, storing it, and converting it back into
electrical energy, among other uses.
The plant produces about 400 kilogrammes of
hydrogen daily, and the hydrogen gas tank can
store up to 12 hours of hydrogen. The plant
uses hydrogen through a hydrogen gas motor to
produce about 280 kilowatts of electrical energy.
The project has been designed and built to
accommodate future applications and test platforms for various uses of hydrogen. In collaboration with DEWA,
ENOC Group’s first green hydrogen station was opened within the Service Station of the Future (SSoF) at Expo
City Dubai.
The station uses green hydrogen, which DEWA produces at its pilot plant at the Mohammed bin Rashid Al
Maktoum Solar Park. The station can fuel approximately 32 cars (FCEV- Fuel Cell Electric Vehicles) at a fuelling
speed of approximately 7 minutes.
The dispensing facility offered by DEWA and ENOC can be integrated with any digital solution for fleet
management. DEWA is conducting experiments on several advanced experimental systems for storing energy
using batteries.
DEWA’s Research and Development (RD) Centre has filed a new patent for an innovative method for improving
the performance of electrodes in lithium-ion (Li-ion) batteries, sodium–sulfur batteries, and electrolyte distribution
batteries. This is achieved by treating the electrodes chemically using a polymer to increase the number of active
groups on the surface of the electrodes, which leads to improving their performance.
The low-cost, environmentally friendly method requires low temperatures and ensures stable battery performance.
This is part of the Centre’s efforts to promote energy production and storage.
The patent supports the pilot project for energy storage that DEWA inaugurated at the Mohammed bin Rashid Al
Maktoum Solar Park using Tesla’s lithium-ion battery solution.
The project has a power capacity of 1.21 MW and an energy capacity of 8.61 MWh with a life span of up to 10
years.
This is the second battery energy storage pilot project by DEWA at the solar park. The first project was
implemented in collaboration with AMPLEX–NGK to install and test a sodium sulphur (NaS) energy solution with
a power capacity of 1.2 MW and an energy capacity of 7.5 MWh. This was the first utility-scale energy storage
pilot project in the region.

UK invests £300m in high-tech nuclear fuel programme
Bloomberg + NewBase
The UK has announced a £300 million investment to establish a high tech nuclear fuel programme.
The programme is designed to produce specialised fuel for advanced nuclear reactors, part of the
UK’s plan to achieve up to 24GW of clean nuclear power by 2050.
This initiative aims to reduce reliance on Russian nuclear fuel, as most advanced reactors require
the specific fuel currently commercially produced only in Russia. The funding will primarily support
domestic production of high assay low enriched uranium, critical for powering the next generation
of nuclear reactors.
An additional £10 million will be allocated to develop skills and infrastructure for the production of
other advanc ed nuclear fuels within the UK. Secretary of State for Energy Security and Net Zero
Claire Coutinho said: “We stood up to Putin on oil and gas and financial markets, we won’t let him
hold us to ransom on nuclear fuel.
“Britain gave the world its first operational nuclear power plant, and now we will be the first nation
in Europe outside of Russia to produce advanced nuclear fuel. “This will be critical for energy
security at home and abroad and builds on Britain’s historic competitive advantages.” The UK needs
new low-carbon electricity generation to meet our commitment to reduce net greenhouse gas
emissions to zero by 2050.
As an interim target, the government is aiming to decarbonise electricity generation by 2035. As
transport and heating also need to be decarbonised by moving from fossil fuels to electric power,

total electricity demand is expected to double by 2050 – which means that the UK will potentially
need to quadruple its low-carbon generation in less than
three decades.
An array of independent analysis and modelling studies
have concluded that net zero needs nuclear to provide
reliable baseload power which can balance the variability
of wind and other renewables, and reduce the total costs
of decarbonising the energy mix.
In the 2022 Energy Security Strategy, the government set
a target of 24 gigawatts of electricity (GWe) from nuclear
power stations by 2050 – up to 25 per cent of the UK’s
projected electricity demand.
The government aims to progress EDF’s Sizewell C to
final investment decision by the end of this Parliament in
2024, with another two new build projects in the next
Parliament. Subject to technology readiness, the 2024–
29 phase may include a small modular reactor (SMR)
project.
Current fleet
The UK currently has five operational nuclear power plants, owned by EDF, with a total capacity of
5.9GWe. All are now reaching the end of their operational lives.
In recent years, the UK nuclear fleet has generated around a fifth of the UK’s electricity – around 65
terawatt-hours (TWh) a year – from eight reactors. Seven of these are advanced gas-cooled
reactors (AGRs) built over the 1960s–80s, all of which are scheduled to retire this decade.
Three AGRs – Dungeness B, Hunterston B and Hinkley Point B – have already ceased generation.
Hartlepool and Heysham 1 are due to cease production in 2024, and Heysham 2 and Torness in
2028. Decommissioning of the AGR fleet will be managed by Nuclear Restoration Services
(formerly Magnox).
The other operational nuclear power station is Sizewell B, the UK’s only pressurised water reactor
(PWR), with a generating capacity of 1.2GWe. Sizewell B began operations in 1995, and was
scheduled to retire in 2035. EDF has announced plans to extend its life by at least 20 years, allowing
it to contribute to the 2050 target.
For the latest information, see EDF’s page on its UK nuclear power stations.
New reactors & GDA
Four gigawatt-scale reactor designs have been formally approved for new build in the UK:
 Framatome’s EPR (originally the Areva European Pressurised Reactor) is a generation III+
PWR, offering a range of safety, economic and operational improvements over previous
designs, and an output of 1.6GWe. Two EPRs are now under construction at Hinkley Point
C in Somerset. EPRs are also under development or operational in Finland, France and
China.
 Westinghouse’s AP1000 is also a Gen III+ PWR, with an output of 1.1GWe. AP1000s are
under construction or operational at two sites in China and two in the US.

 The 1.3GWe Hitachi-GE Advanced Boiling Water Reactor (ABWR) operates at lower
pressures and temperatures than PWRs, and features a much larger pressure vessel. Four
ABWRs are in operation in Japan.
 The Chinese Hualong HPR1000 is a 1.17GWe PWR. Three reactors are operational in China
and two in Pakistan, with another 11 under construction in China.
These four reactors have all completed the UK’s generic design assessment (GDA) by the Office
for Nuclear Regulation (ONR) and Environment Agency. This assessment is intended to support
the construction of a number of new nuclear power stations by approving a standard reactor design
which can be built in different locations by different developers. Each build will still require a site-
specific licence.
The UK is also considering the development of small modular reactors based on Gen III+
technologies, with the first potentially online by 2030, as well as new designs of advanced modular
reactors based on Gen IV technologies.
The Rolls-Royce SMR, a 470MWe PWR, formally entered GDA in early 2022. Six other SMR
designs were submitted for GDA entry in December 2022.

India: Vitol and GAIL sign Long Term LNG supply into India
Source: Vitol
GAIL (India) Limited and Vitol Asia Pte Ltd have announced the signing of a Long Term LNG supply
deal into India for the annual supply of approx. one million metric tons of LNG for a period of approx.
10 years, starting from 2026. Under this deal, Vitol will deliver LNG from its global LNG portfolio to
GAIL and these deliv eries will be on a pan-India basis.
GAIL Chairman and Managing Director, Mr Sandeep Kumar Gupta said 'This long term LNG
supply deal with Vitol by GAIL will augment its large Liquefied Natural Gas (LNG) portfolio and will
contribute to bridging India’s demand and supply gap of natural gas.
' Vitol CEO, Mr Russell Hardy said 'We are pleased to build on the existing relationship between
Vitol and GAIL and to conclude this Long Term LNG supply deal together. India is a significant and
growing LNG market and we are excited to bring LNG supply from our global LNG portfolio to meet
this rising natural gas demand in India.'
GAIL as a leading natural gas company has formidable presence in India’s gas trading, transmission, LPG
production & transmission, LNG re-gasification, petrochemicals, city gas, E&P. GAIL which owns and
operates a network of over 16,000 km of natural gas pipelines on pan India basis is working concurrently on
execution of multiple pipeline projects to further enhance the spread.
GAIL commands around 70% market share in gas transmission and has a Gas trading share of over 50% in
India. GAIL and its Subsidiaries / JVs also have a formidable market share in City Gas Distribution.
Vitol is a leader in the energy sector with a presence across the spectrum: from oil and gas through to power,
renewables and carbon. It trades 7.4 million barrels per day of crude oil and products, and charters circa
6,000 sea voyages every year.

NewBase January 08 -2024 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil slips as higher OPEC supply, Saudi price cuts offset Mideast worries
Reuters + NewBase
Oil prices dipped in early trade on Monday on sharp price cuts by top exporter Saudi Arabia and a
rise in OPEC output, offsetting worries about escalating geopolitical tensions in the Middle East.
Brent crude fell 9 cents, or 0.1%, to $78.67 a barrel by 0057 GMT, while U.S. West Texas
Intermediate crude futures shed 10 cents, or 0.1%, to $73.71 a barrel.
Both contracts climbed more than 2% in the first week of 2024 after investors returned from holidays
to focus on geopolitical risks in the Middle East following attacks by Yemeni Houthis on ships in
the Red Sea.
U.S. Secretary of State Antony Blinken, who is in the Middle East this week, warned that the Gaza
conflict could spread across the region without concerted peace efforts, although Israeli Prime
Minister Benjamin Netanyahu vowed to continue the war until Hamas was eliminated.
Oil price special
coverage
 U.S. seeks to avert wider war in Middle East
 OPEC output rises 70,000 bpd in Dec - Reuters survey
 Saudi Aramco slashes price for key crude grade to Asia

Offsetting the upward pressure on prices from geopolitical concerns, output from the Organization
of the Petroleum Exporting Countries (OPEC) rose 70,000 barrels per day (bpd) in December to
27.88 million bpd, according to a Reuters survey.
Rising supply and competition with rival producers, prompted Saudi Arabia on Sunday to cut the
February official selling price (OSP) of its flagship Arab Light crude to Asia to the lowest level in 27
months.
"If we were just to focus on the fundamentals including, higher inventories, higher OPEC/non-OPEC
production, and a lower than expected Saudi OSP, it would be impossible to be anything other than
bearish crude oil," IG analyst Tony Sycamore said.
"However, that doesn’t take into account the fact that geopolitical tensions on the Middle East are
undeniably rising again which will mean limited downside."
In the U.S., oil drilling rigs were up by one at 501 last week, Baker Hughes said in its weekly report.
JPMorgan forecasted 26 oil rigs to be added this year, most of them in the Permian during the first
half of the year.
"The timing of drilling is paramount, as rig additions at the start of the year will contribute to 2H24
production growth," the bank's analysts said in a note.
"Despite an impressive 1 mbd of crude and condensate production growth in 2023, we expect 2024
supply to increase by only 400 kbd due to lower completions activity levels vs 2023."

U.S. Henry Hub NG prices in 2023 were the lowest since mid-2020
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook
The U.S. benchmark Henry Hub natural gas price averaged $2.57 per million British thermal units
(MMBtu) in 2023, about a 62% drop from the 2022 average annual price, according to data from
Refinitiv Eikon.
Record-high natural gas production, flat consumption, and rising natural gas inventories contributed
to lower prices in 2023 compared with 2022. The monthly average Henry Hub price was below
$3.00/MMBtu in every month except January, with the lowest monthly average in May at
$2.19/MMBtu.
Record-high natural gas production that outpaced growth in natural gas consumption was the
primary driver of lower prices in 2023. We estimate that U.S. dry natural gas production averaged
a record-high 104 billion cubic feet per day (Bcf/d) in 2023 in our December Short-Term Energy
Outlook, 4% higher than the 2022 annual average.
Production increased in the Permian region, driven by improved well-level productivity and higher
crude oil prices in 2023, as well as in the Haynesville region and the Appalachia region, according
to our Drilling Productivity Report.
Warmer-than-average temperatures in January and February 2023—the peak of heating season—
led to reduced consumption in the residential and commercial sectors and the lowest total U.S.
natural gas consumption for these months in seven years.

Temperatures were relatively mild in the U.S. Midwest and Northeast, where 50%–70% of
households report using natural gas as their primary space-heating fuel. Mild temperatures also led
to lower withdrawals of natural gas from underground storage.
Overall, natural gas demand increased by 3% in 2023 compared with 2022. Increased exports and
a slight increase in natural gas consumed for electricity generation offset lower residential and
commercial sector consumption. Liquefied natural gas exports rose 12% in 2023 compared with
2022, and natural gas exports by pipeline increased 9% over the same period.
Note: Total supply=production+imports. Total demand=exports+total consumption. Total
consumption=residential+commercial+electric power+industrial.
The mild temperatures at the end of the 2022–23 winter resulted in lower withdrawals from natural
gas storage than during the previous seven winters, and the United States began the 2023 injection
season (April–October) with relatively high storage volumes.
Natural gas injections into storage in the summer exceeded the five-year average, and U.S. natural
gas inventories at the start of this winter heating season were the highest since 2020.
As a result of production remaining at all-time highs (averaging 105 Bcf/d in the fourth quarter of
2023) and less natural gas consumed in the residential and commercial sectors so far this winter
heating season than the previous heating season, working natural gas inventories were 11% above
the year-ago level and 10% above the five-year average as of the week ending December 22,
according to our Weekly Natural Gas Storage Report.

NewBase Specual Coverage
The Energy world –January 02 -2024
CLEAN ENERGY
The Red Sea crisis, and what does it mean for global trade?
Richard Partington Economics correspondent , @RJPartington + NewBase
Attacks by Houthi rebels along the trade route have led to firms pausing shipments, raising the
possibility of a shock to the world economy
The world’s largest shipping firms are continuing to pause
shipments through the Red Sea after attacks by Houthi rebels
along the crucial international trade route.
As container ships are diverted around the Cape of Good Hope
on the southern tip of Africa, adding thousands of miles to
journeys, the disruption is driving up the cost of shipments from
Asia to Europe, raising the prospect of a renewed inflation
shock for the world economy.
What is happening in the Red Sea?
Iran-backed Houthi rebels in Yemen have significantly stepped up a campaign of attacks against
commercial vessels in the Bab-el-Mandeb strait between the Arabian peninsula and the Horn of
Africa since late November.
Launched in response to Israel’s bombardment of Gaza, the attacks have escalated in the past
week. Helicopters launched from US navy warships were used to repel an attack by militants on a
ship owned by Maersk over the weekend, leading the Danish shipping line to continue to pause all
cargo movement through the area until further notice.

Germany’s Hapag-Lloyd has also said its container ships would continue to avoid the route, which
is a central artery for global trade on the passage from Asia to Europe via the Suez canal and the
Mediterranean.
How significant is the Red Sea trade route?
The Suez canal handles about 12% of global trade and is accessed by vessels travelling from Asia
via the 30km wide Bab-el-Mandeb strait. About half of freight shipped through the canal is made up
of containerised goods. The route also provides a vital passage for shipments of oil from the Persian
Gulf to Europe and North America.
Rerouting shipments around the Cape of Good Hope adds about 3,000-3,500 nautical miles
(6,000km) to journeys connecting Europe with Asia, adding about 10 days to the duration of the trip,
according to the Dutch bank ING.
With the prospect of lengthier shipping times, there could be a knock-on impact for turnaround times
at ports in the UK and large European hubs such as Rotterdam, Antwerp and Hamburg.
Could it drive up inflation?
Redirecting ships is expected to cost up to $1m in extra fuel for every round trip between Asia and
Europe, while insurance costs are also rising, adding to the overall cost of shipments.
Tankers transporting diesel and jet fuel from the Middle East and Asia are being diverted, while
container shipments of consumer goods, commodities, clothing and food are also likely to be
delayed.
Global oil prices rose on Wednesday as concerns over delays in the Red Sea were compounded
by reports of disruption to Libya’s biggest oilfield. However, crude prices have remained relatively
stable and are still significantly lower than in recent months, having fallen by almost $20 a barrel
since the autumn.

Shipping costs can have a big inflationary impact. During the Covid pandemic, the International
Monetary Fund estimated that global supply chain bottlenecks added about 1 percentage point to
inflation. During normal times, freight costs contribute about 7% of the costs of long-haul imports.
This jumped as high as 25% during the Covid disruption.
Rhys Davies, a former government trade adviser who now advises clients at the consultancy firm
Flint Global, said freight costs had clearly been affected by tensions in the Red Sea, but that the
impact on inflation would probably be limited.
“The effect feeds into the economy pretty slowly, taking about 12 months after the spike [in shipping
costs,” he said. “So if the disruption is time-limited, as we would expect, it will probably be drowned
by wider disinflationary impacts.”
How much does context matter?
Unlike when the Suez canal was blocked by the Ever Given container ship in 2021, triggering mass
problems for world trade, the economic backdrop to the current Red Sea disruption is markedly
different.
Two years ago global supply chains were creaking under the pressure of red-hot demand for
manufactured goods from consumers who were blocked from spending on services by lockdown
restrictions, while factory output and global freight were unable to keep pace.

Today, inflation is cooling as the world’s leading central banks use higher interest rates to crush
demand. With households and businesses under pressure, world trade volumes and economic
growth have slowed, raising the prospect of recessions in the US, UK and EU nations.
Although global freight costs have risen sharply in recent days thanks to the Red Sea disruption,
they remain significantly lower than two years ago. The Shanghai Containerized Freight Index, the
most widely used index for sea freight rates for imports from China worldwide, is down by more than
half.
James Smith, an economist at ING, said: “It brings back memories of the pandemic when supply
chains were obviously messed up, and there was the Suez canal blockage as well. The
circumstances, at least for now, are quite different.”
Why Red Sea attacks might burn a hole in your pocket
Main points:
 Global economy is poised for inflation shock and delayed supplies amid attacks by Iran-
backed Houthi rebels in Red Sea.
 The Red Sea accounts for around 12 per cent of global trade.
 Oil prices have risen in the first session of new year, with Brent crude up by 0.6 per cent to
$77.53 a barrel.
The global economy is poised for an inflation shock and delayed supplies amid persistent attacks
by Iran-backed Houthi rebels on merchant vessels in the Red Sea, as the fallout of the Israel-Hamas
war in Gaza continues to roil the busy waterway.
Shipping costs and oil prices have already started seeing a rise, with the Houthis, who control much
of Yemen, promising to inflict more damage until more aid enters the Gaza Strip, where Israeli
bombardment has killed over 20,000 people.
The Red Sea, which is the main gateway for around 12 per cent of global trade, has seen the
Iran-backed rebels launching more than 20 attacks on merchant ships in recent weeks, prompting
several shipping companies to suspend trade or take a longer route between Asia and Europe.

Red Sea Crisis: Top Developments
 Most vessels are now being diverted around the Cape of Good Hope on the southern tip of
Africa, which has resulted in an addition of thousands of miles (around 6,000 km) to the
journey, increasing the voyage by 12–15 days. As per a CNBC report, more than $200 billion
in trade over the past several weeks has already been diverted in the past several weeks.
 A Malta-flagged ship, believed to be headed to Israel, was the latest vessel to be attacked
by the Houthis even though it was not hit. Earlier this week, two anti-ship ballistic missiles
were fired toward merchant ships near the Bab al-Mandeb Strait, the US has claimed. The
UK maritime trade operations department has also reported blasts near a cargo ship between
the coasts of Eritrea and Yemen.
 In response, the US has set up an international naval task force to protect shipping in the
Red Sea region. Over the past two weeks, several of the missiles and drones deployed by
the Houthi rebels, who have warned of targeting ships with links to Israel, have been shot
down by US, French and British warships. Stepping up its offensive, the US military also
claimed to have sunk Houthi boats during the weekend after the rebels attacked a Maersk
ship, AFP reported. Ten Houthi rebels are believed to have been killed.
 The Red Sea is an important route for oil transportation and around 10 per cent of the world's
oil passes through its waters. The crisis has fuelled a rise in oil prices in the first session of
the new year, with Brent Crude up by 0.6 per cent to $77.53 a barrel, Reuters reported. British

Petroleum (BP), one of the top oil firms, has rerouted its vessels, which will result in delayed
arrivals and pinch the pockets of consumers.
NewBase Energy News 08-January - Issue No. 1688 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services

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About: Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
www.linkedin.com/in/khaled-al-awadi-38b995b
Mobile: +971504822502
khdmohd@hawkenergy.net or khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas
sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S.
Universities. Currently working as self leading external Energy consultant for the
GCC area via many leading Energy Services companies. Khaled is the Founder of
the NewBase Energy news articles issues, Khaled is an international consultant,
advisor, ecopreneur and journalist with expertise in Gas & Oil pipeline Networks,
waste management, waste-to-energy, renewable energy, environment protection
and sustainable development. His geographical areas of focus include Middle East,
Africa and Asia. Khaled has successfully accomplished a wide range of projects in
the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities & gas
compressor stations. Executed projects in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of gas/oil supply routes.
Has drafted & finalized many contracts/agreements in products sale, transportation, operation &
maintenance agreements. Along with many MOUs & JVs for organizations & governments authorities.
Currently dealing for biomass energy, biogas, waste-to-energy, recycling and waste management. He has
participated in numerous conferences and workshops as chairman, session chair, keynote speaker and
panelist.
Khaled is the Editor-in-Chief of NewBase Energy News and is a professional environmental writer with over
1400 popular articles to his credit. He is proactively engaged in creating mass awareness on renewable
energy, waste management, plant Automation IA and environmental sustainability in different parts of the
world. Khaled has become a reference for many of the Oil & Gas Conferences and for many Energy program
broadcasted internationally, via GCC leading satellite Channels. Khaled can be reached at any time, see
contact details above.

NewBase 08 January 2024 Energy News issue - 1688 by Khaled Al Awadi.pdf

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NewBase 08 January 2024 Energy News issue - 1688 by Khaled Al Awadi.pdf