Coronavirus outbreak's effect on the oil and gas market - Aljazeera.com

As the death toll from the coronavirus keeps rising, it is crippling not only China's economy but is having a knock-on effect globally.

Formula One's race in Shanghai has been postponed and this year's Mobile World in Barcelona has been cancelled. Oil prices have tumbled 20 percent below their January peaks, raising the prospect that OPEC could cut production again.

But it is not only OPEC that is feeling the pinch. China has also turned away gas tankers, slashing gas prices in half.

Yury Sentyurin, secretary-general of the Gas Exporting Countries Forum, said: "This is a force majeure situation. Any contract between sellers and buyers have a special clause ... called force majeure, for some events and situations which are out of the influence of participants of the parties of the contracts."

Sentyurin points out there may be some postponements and delays in contracts but argues: "I think this is a temporary situation because fortunately life hasn't stopped and people will continue living, will continue producing, will continue consuming and everything will continue, from my point of view."

The economic impact of rising sea levels

Warming oceans and melting ice caps could cause sea levels to rise by more than a metre (three feet) by the end of the century, according to the United Nations.

The rise could displace or affect up to 680 million people living along the world's coastlines. The UK's National Oceanography Centre (NOC) projected that flooding from rising sea levels could cost the globe $14 trillion annually by 2100.

Indonesia is planning to spend more than $30bn on moving its capital because Jakarta is sinking at an alarming rate. A majority of the city could be submerged by 2050.

The United States will need to spend $400bn over the next 20 years to improve its flood defences. And New York state is considering spending more than $100bn on a storm barrier, an idea President Trump calls: "costly, foolish and environmentally unfriendly".

But the World Bank believes every dollar spent on sea defences can yield between $7 to $10 by preventing costly damage.

Swenja Surminski, head of Adaptation Research at the Grantham Research Institute, tells Al Jazeera climate change is the "defining issue of our generation" and it is "no longer a distant threat" as the impacts of climate change can be seen, particularly along coastal areas.

"Coastal areas are particularly exposed, not just because of sea-level rise, but also other challenges."

Surminski notes that water usage and the fact that about half of all global megacities are in coastal areas are major challenges in battling the threat of climate change and rising sea levels.

"So these are massive, and still growing sites, where people live, where their livelihoods are - and these are exposed from sea-level rise."

Source: Al Jazeera News

2020-02-16 08:16:00Z
https://www.aljazeera.com/programmes/countingthecost/2020/02/coronavirus-outbreak-effect-oil-gas-market-200215131949394.html