Oil prices reach peak in March
The combination of imminent conflict in Iraq, political chaos in Venezuela and freezing weather in the U.S. caused the price of a barrel of oil to soar to almost $40 in the first week of March, the highest since the Gulf war. That is up about 69 percent from a year ago.
Oil prices slid 9.5 percent after President Bush delivered his ultimatum to Saddam Hussein.   Dealers are betting on an easy U.S.-led victory over Iraq in a military action they expect to cause only a brief disruption to Middle East oil flows. But oil prices would spike even further if a war in Iraq proves to be longer than expected. 
The rise in oil prices is already influencing global economy. Studies show that since 1947 there has been a strong correlation between oil price shocks and recessions: nine of the ten recessions between 1947 and 1991 were preceded by oil shocks, and nine of the ten oil shocks were followed by a recession. Britain has already reported that its economy had grown at the most sluggish pace in 10 years during the last three months of 2002. The German economy shrank at the end of last year for the first time in a year. The U.S. economy is also taking a toll. American firms have blamed higher energy costs for cuts in their earnings forecasts. Some of them postpone new investments that could add jobs. Because Americans pay almost 50 percent more for gasoline than they did a year ago, their spending on other goods is in decline. Over all, purchases at American retail chain stores fell 1.1 percent in January. According to a recent Gallup poll, about one-third of Americans say the recent spike has caused them "financial hardship". The ailing airline industry is also being hit hard. American Airlines will probably spend about $200 million more on fuel this quarter than it did a year ago.

Muslim countries consider an oil embargo to stop the U.S. from attacking Iraq - According to the Financial Times, Mahathir Mohamad, the Malaysian prime minister, said in a special meeting of the Organization of the Islamic Conference (OIC) in Kuala Lumpur that Muslim countries would consider an oil embargo to stop the US from attacking Iraq.
The Malaysian leader conceded an oil embargo carried risks. "This double-edged weapon may hurt us more than it may hurt" the west because many poor developing countries would suffer from higher oil prices. "Of course there were some views that such weapons could rebound and we might have to pay a very high price," Mahathir said. "We agreed that we should think about it, not just dismiss it."
Analysts believe that Saudi Arabia, Kuwait and several other Muslim oil producers would be unlikely to support such an embargo.

Middle East expert predicts Saddam would target oil fields:  Shibley Telhami, Senior Fellow at the Brookings Institution wrote in the Baltimore Sun that if attacked, knowing that a war would bring the end of his regime, Saddam Hussein is likely to be more inclined to torch his oil fields. The logic: putting the fields out of commission for an extended period would bring about significant consequences for the global economy. Destroying oil fields could create international pressure on the U.S. and undermine its staying power. Iraq would want to avenge the American attack and foil what most in the region believe to be U.S. attempt to seize Iraqi oil. "It is improbable that the Iraqis do not know how to do it or that their leaders have not seriously contemplated an oil-denial plan as a contingency of last resort," Telhami wrote.

It took Kuwait two years and over $20 billion to restore its oil production after Kuwaiti oil fields were ignited by Iraqi forces during the Gulf War. U.S. officials estimate that it could cost as much as $50 billion to repair and reconstruct Iraq's production if its oil wells are ignited.

American and Canadian workers slain at oil rig in Yemen  - A Yemeni gunman killed an American, a Canadian and a Yemeni worker at an American oil rig in northern Yemen today and then killed himself, the Hunt Oil Company said. One Canadian worker was wounded.

India shuts refinery in northeast after the United Liberation Front of Asom (ULFA) blew up a large gasoline storage tank and bombed a gas pipeline in the Indian state of Assam.  Police and paramilitary troops are protecting 15 Russian oil experts from Moscow-based company LARGE, hired by state-run Oil India Ltd. to locate hydrocarbon reserves in the area., because of fears that the separatist rebels may try to kidnap them.  For an overview of threats to oil transport click here.

Natural gas prices hit record highs -  The New York Times reports the cold winter season in the eastern U.S. has been the primary cause of the rise in demand for natural gas sapping natural gas supplies and setting the stage for higher energy bills. The U.S. Energy Information Administration (EIA) estimates that homeowners will be paying about 15 percent more this year for heating their homes with natural gas. Some analysts, who just last fall predicted that natural gas usage would rise by 2-3 percent in 2003, now expect overall consumption to fall 1-5 percent this year because of high prices.  The U.S. holds only 3% of the world's natural gas reserves.

Senator Dorgan introduces bill to launch Apollo project for hydrogen powered fuel cell vehicles.  Senator Byron Dorgan (D-ND) unveiled legislation that would launch an Apollo-like program to develop hydrogen-powered fuel cell vehicles and the infrastructure to support them. The effort aims to help free the U.S. from what Dorgan described as a “dangerous dependence” on imported oil, and is already attracting broad support. Current co-sponsors of the bill include Senators Joe Lieberman (D-CT), Hillary Clinton (D-NY), John Kerry (D-MA), James Jeffords (I-VT), Jon Corzine (D-NJ), Kent Conrad (D-ND) and Daniel Akaka (D-HI). Dorgan said he expects to have bi-partisan support for the legislation and is actively discussing that prospect with a number of  Republican Senate colleagues. The Dorgan plan invests $6.5 billion over 10 years to develop hydrogen fuel cells, stationary cells and the necessary infrastructure to allow popular use of both. Included are research and development on hydrogen – including storage, distribution and fueling infrastructure – and on fuel cell technologies. Also included are funding for pilot projects; a federal purchase program; and tax incentives for stationary fuel cells, fuel cell vehicles, and hydrogen fueling infrastructure. The plan also sets bold targets and timetables for reaching those goals for commercializing hydrogen fuel cell vehicles and moving them onto the nation’s highways.  
Dorgan outlined details of the bill on March 5 in a keynote speech  to the National Hydrogen Association annual meeting. “America must show the same commitment we demonstrated in meeting other urgent national challenges to accomplish what had previously been thought to be impossible: putting a man on the moon, building the transcontinental railroad, creating a nation-wide system of interconnected interstate highways, and more. My plan does that,” Dorgan said.

L.A. gets new fuel cell power plant:  Los Angeles became one of the first cities in the nation to begin a prototype program of a hydrogen fuel-cell system with a 10-by-28-foot structure similar to a large shed that can generate 250 kilowatts of power -- enough for 250 homes.  More info here.

Kun Soo Lee, senior analyst at WestLB Securities Pacific, bets fuel cells will be Japan's next megahit.   Japanese companies already hold key fuel cell patents and are expected to lead the world in this lucrative market, Lee said. Among the leading Japanese fuel cell developers are Sanyo Electric Co., Sony Corp., Casio Computer Co., NEC Corp., Hitachi Ltd., and Matsushita Electric Industrial Co.  Toshiba Corp. said earlier this month it has developed the world's first prototype of a direct methanol-type fuel cell system to run notebook personal computers.  

International Platinum Association corrects erroneous reports on the availability of platinum for fuel cells - Platinum is the only viable catalyst for Proton Exchange Membrane (PEM) Fuel Cells.  The significance of this fact raised the issue of the availability of platinum and sparked debate about the readiness of the platinum industry to meet global demand for platinum once fuel cells are commercialized.
The International Platinum Association (IPA), which comprises the world's leading platinum group metals, producers and fabricators, confirms that enough platinum resource is available worldwide to meet any foreseeable future demand spurred by the commercialization of fuel cells.
"The platinum resource industry wants to set the record straight: there is more than enough platinum to satisfy the widespread introduction of fuel cells, for automotive propulsion, stationary power generation or other uses," said Marcus Nurdin, Managing Director of the International Platinum Association. Several erroneous media reports have recently suggested otherwise, potentially causing needless uncertainty among legislators, regulators, and the general public. "Not only are the platinum miners, producers and fabricators convinced that enough platinum resource is available to meet all foreseeable demand, but increasingly, industry-leading automobile and fuel cell manufacturers agree that platinum availability is not a cause for concern."

Nissan Motor will jointly develop a fuel cell with the U.S. group United Technologies Corp - Nissan Motor will jointly develop a fuel cell with the U.S. group United Technologies Corp.
Nissan announced that a fuel cell power plant developed by UTC Fuel Cells, a unit of United Technologies, would be used in its X-Trail fuel cell test vehicle this year.
The X-Trail, Nissan's new high-pressure hydrogen-powered fuel cell vehicle was presented in Tokyo in December 2002 and had already won approval from the Japanese government to test the hydrogen-powered fuel cell vehicle on public roads in Japan in 2003. The company said in December it would start limited marketing of its X-Trail FCV this year, two years ahead of its original program. Nissan's decision to partner with UTC's fuel cell unit is likely to speed up commercialization of fuel cell vehicles.

Auto companies join forces with energy suppliers to demonstrate viability of hydrogen refueling infrastructure - DaimlerChrysler is working with  energy-supply companies and other manufacturers in the opening of the first Japanese fuel-cell testing facility in the Japan Hydrogen & Fuel Cell Demonstration Project. The facility will provide a location for companies to conduct fuel-cell vehicle testing as well as infrastructure development.  General Motors Corp. and Shell Hydrogen are also combining resources. The centerpiece of the partnership will be a real-life demonstration of hydrogen fuel cell vehicles and fueling infrastructure technology in the Washington, D.C. area between GM and Shell Hydrogen (U.S.). The demonstration will feature the nation's first hydrogen pump at a Shell retail gas station to support a General Motors Corp. fleet of fuel cell vehicles.

The U.S. and Israel share a vision of energy independence of democracies in the 21-century.