1) China manufacturing slows again, halts oil rally
A dramatic rally in the price of oil triggered by a collapse in the US drill count came to an abrupt halt with data suggesting China’s giant manufacturing sector slowed for the second straight month and a strike at US oil refineries.
In fact – the FT reports - China’s factory sector shrank in January for the first time in more than two years, the latest signal that the country’s growth slowdown is set to persist after the economy’s weakest expansion in 24 years in 2014 as service activity expanded at its lowest level in a year, according to Reuters.
China’s slowdown – combined with the low oil price – poses the risk of global deflation, the wire reports, as the South China Morning Post observes that the low cost of oil is failing to spark China’s economy, because it is a relatively small part of the energy mix.
2) Oil price impact: BP cuts spending, Chevron cuts shale exploration
The news comes as U.S. energy major Chevron Corp said it will stop exploring for shale gas in Poland.
Chevron’s Polish unit “has decided to discontinue shale gas operations in Poland as the opportunities here no longer compete favourably with other opportunities in Chevron’s global portfolio”, Reuters reports.
3) Low energy prices hit US, India, EU coal/gas sector
The FT reports on a crisis for the US coal sector as low gas prices have reduced demand for coal from the power sector. US coal prices hit their lowest level in six years with one firm closing three mines and cutting jobs at two more.
And in Europe low coal and carbon prices continue to render German gas plants unviable even despite lower gas prices from oil-linked Russian contracts. Bloomberg reports on the emergence of a new market in former German gas power stations ready to ship to developing countries.
4) Row over SNP fracking ban
The Telegraph and Times report that the SNP accused of fabricating reasons for banning fracking by an expert they asked to research shale gas.
Professor Paul Younger, Rankine Chair of Engineering at the University of Glasgow,said he felt “completely violated as a professional” following the announcement of the ban.