ING’s announcement that it will cut jobs across the Benelux signals that automation is doing more than replacing blue-collar jobs; white-collar jobs are in danger, too.
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This morning, Royal Dutch Shell plc reported on its website that its earnings during March, April, and June of this year fell 21 percent compared to the same quarter in 2012. The CEO, the Dutch Peter Voser, attributed the decline to “higher costs, exploration charges, adverse currency exchange rate effects and challenges in Nigeria.” Along the way, Shell has devalued its natural gas reserve operations in the United States by 1.8 million Euros.
Undermining its position in the US’s natural gas business may seem contradictory to successful extraction from shale formations in recent years. However, the write-down reflects the commodity’s downward price trend. James Herron on WSJ’s Moneybeat blog wrote:
The industry has been so successful producing gas that the price of the fuel has plummeted from $13 per million Btu in 2008 to just over $3 per million Btu currently, making assets worth less than originally hoped.
Shale gas from the United States may have become a cheaper commodity than Shell would like.
However, Shell has not yet indicated the specific reason for which its shale gas operations have become less valuable but bases its decision on “the latest insights from exploration and appraisal drilling results and production information.” So, a report of some sort.
I covered a talk on energy policy at a recent conference in Delft, a couple of months ago. A representative from the DoE presented some findings from the US Energy Information Administration’s Annual Energy Outlook 2013 report that said that shale gas demand would only surpass supply in 2020. Until then, low gas prices in the commodities market will be the reality.
Herron points out that Shell’s devaluation in its gas exploration assets might trigger anti-fracking activists to beef up their cause.
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