Commodities
World’s war on greenhouse gas emissions has a military blind spot
© Reuters. FILE PHOTO: A South Korean army K1A1 tank fires during a live-fire drill which is a part of the joint military drill “Freedom Shield” between South Korea and U.S. at a military training field near the demilitarized zone separating the two Koreas in Pocheo
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By Sarah McFarlane and Valerie Volcovici
LONDON/WASHINGTON (Reuters) – When it comes to taking stock of global emissions, there’s an elephant in the room: the world’s armed forces.
As temperatures hit new highs, scientists and environmental groups are stepping up pressure on the U.N. to force armies to disclose all their emissions and end a long-standing exemption that has kept some of their climate pollution off the books.
Among the world’s biggest consumers of fuel, militaries account for 5.5% of global greenhouse gas emissions, according to a 2022 estimate by international experts.
But defence forces are not bound by international climate agreements to report or cut their carbon emissions, and the data that is published by some militaries is unreliable or incomplete at best, scientists and academics say.
That’s because military emissions abroad, from flying jets to sailing ships to training exercises, were left out of the 1997 Kyoto Protocol on reducing greenhouse gases – and exempted again from the 2015 Paris accords – on the grounds that data about energy use by armies could undermine national security.
Now, environmental groups Tipping Point North South and The Conflict and Environment Observatory, along with academics from the British universities of Lancaster, Oxford and Queen Mary are among those pushing for more comprehensive and transparent military emissions reporting, using research papers, letter campaigns, and conferences in their lobbying drive.
In the first five months of 2023, for example, at least 17 peer reviewed papers have been published, three times the number for all of 2022 and more than the previous nine years combined, according to one campaigner who tracks the research.
The groups also wrote in February to the U.N. Framework Convention on Climate Change (UNFCCC) calling on the United Nation’s climate body to include all military emissions given their significance for comprehensive global carbon accounting.
“Our climate emergency can no longer afford to permit the ‘business as usual’ omission of military and conflict-related emissions within the UNFCCC process,” the groups wrote.
Emissions accounting will come into focus in the first global stocktake – an assessment of how far behind countries are from the Paris climate goals – due to take place at the COP28 climate summit in the United Arab Emirates starting on Nov. 30.
“The omission of conflict-related emissions in UNFCCC accounting is a glaring gap,” said Axel Michaelowa, founding partner of Perspectives Climate Group, adding that hundreds of millions of tons of carbon emissions may be unaccounted for.
‘RECOVERY AND PEACE’
For now, however, there are few signs there will be any tangible response to the lobbying drive this year.
The UNFCCC said in an emailed response to questions that there were no concrete plans to amend guidance on military emissions accounting, but that the issue could be discussed at future summits, including at COP28 in Dubai.
Asked whether military emissions would be discussed at the U.N. summit, the UAE presidency said one of its thematic days during the two-week summit would be “relief, recovery and peace”, without giving further details.
There are signs, however, that some militaries are preparing for changes in their reporting requirements in the coming years, while others are making strides to cut their climate impact.
NATO, the 31-country Western security alliance, for example, told Reuters it has created a methodology for its members to report their military emissions.
Countries such as New Zealand are exploring whether to add previously excluded areas, such as emissions from overseas operations, while Britain and Germany are looking to address grey areas in their reporting, defence officials said.
And Washington sent U.S. Army and Navy representatives to the COP27 climate summit in Egypt last year, the first time a Pentagon delegation has attended the global climate summit.
“What I think that signified is that we are part of the conversation, we are certainly emitters when it comes to fossil fuels and energy,” Meredith (NYSE:) Berger, assistant secretary for energy, installations and environment at the U.S. Navy and one of the Pentagon delegates, told Reuters.
The U.S. military’s oil use and emissions are falling.
The U.S. Defence Logistics Agency, which oversees oil buying, said 84 million barrels were purchased in 2022, down almost 15 million from 2018. Emissions in 2022, meanwhile, fell to 48 million tonnes from 51 million tonnes the previous year.
The U.S. Department of Defense said those figures included all emissions, but that it stripped out international transport and bunker fuels from the numbers reported to the UNFCCC.
MORE DRONES
Neta Crawford, a professor of international relations at Oxford University, said U.S. troop withdrawals from Afghanistan and Iraq, the adoption of renewable energy technologies, more fuel-efficient vehicles, as well as fewer and smaller military exercises, had contributed to the declines in the fuel use.
The wider use of drones may also have helped.
“One of the biggest emissions reduction technologies has been the used of unmanned aerial vehicles – drones,” said a senior U.S. defense official, who spoke to Reuters on condition of anonymity. “When you take a human out of the aircraft, you get dramatically improved energy performance.”
Groups lobbying the U.N. to lift the military exemptions point to a surge in emissions related to the Ukraine conflict as a good reason for the change.
“Ukraine has absolutely brought the spotlight onto this issue in a way that other conflicts have not,” said Deborah Burton at environmental group Tipping Point North South.
A report from Dutch carbon accounting expert Lennard de Klerk estimated the first 12 months of the war in Ukraine will trigger a net increase of 120 million tonnes of greenhouse gases, equivalent to the annual output of Singapore, Switzerland and Syria combined.
And academics from Oxford and Queen Mary University of London are holding a conference on military emissions in Oxford on Sept. 26, with the aim of generating new research that could help inform changes to reporting requirements.
Ukraine’s environment ministry spokesperson said it supports the efforts and would seek backing from governments at COP28 for more transparent military emissions reporting.
‘FREE RIDE’
While the Ukraine war has heightened the focus among climate activists on military emissions, some experts say it is a distraction for governments focused on regional security, and that could slow discussions in the near term.
“It’s important to understand the Ukraine crisis has made this a little bit more complicated,” said James Appathurai, NATO’s deputy assistant secretary general for emerging security challenges.
Some militaries say publishing details on their oil use would be a window into their overseas operations.
“We would not want to let everybody know how much fuel we use in these missions – how far we fly, how far we drive, and what our exercise patterns are,” said Markus Ruelke, from the German defence ministry’s environmental protection unit.
Some military emissions are recorded under unspecified fuel combustion in the U.N.’s reporting tables, the UNFCCC said.
In the meantime, global military emissions will remain poorly understood, said Stuart Parkinson, executive director of the group Scientists for Global Responsibility.
“It’s all very well telling people to stop flying or switch to an electric car, whether that’s an expense or inconvenience to them, but it’s hard to do that when the military gets a free ride,” he said.
By Anna Hirtenstein
LONDON (Reuters) -Oil prices surged on Friday and were on track for a third straight week of gains as traders focused on potential supply disruptions from more sanctions on Russia and Iran.
futures gained $2.66, or 3.5%, to $79.58 a barrel by 1154 GMT, reaching their highest in more than three months. U.S. West Texas Intermediate crude futures advanced $2.64, or 3.6%, to $76.56.
Over the three weeks to Jan. 10, Brent has climbed 9% while WTI has jumped 10%.
“There are several drivers today. Longer term, the market is focused on the prospect for additional sanctions,” said Ole Hansen, head of commodity strategy at Saxo Bank. “Short term, the weather is very cold across the U.S., driving up demand for fuels.”
Ahead of U.S. President-elect Donald Trump’s inauguration on Jan. 20, expectations are mounting over potential supply disruptions from tighter sanctions against Iran and Russia while oil stockpiles remain low.
This could materialise even earlier, with U.S. President Joe Biden expected to announce new sanctions targeting Russia’s economy before Trump takes office. A key target of sanctions so far has been Russia’s oil and shipping industry.
“That would be the farewell gift of the Biden administration,” said PVM analyst Tamas Varga. Existing and possible further sanctions, as well as market expectations of draws on fuel inventories because of the cold weather, are driving prices higher, he added.
The U.S. weather bureau expects central and eastern parts of the country to experience below-average temperatures. Many regions in Europe have also been hit by extreme cold and are likely to continue to experience a colder than usual start to the year, which JPMorgan analysts expect to boost demand.
“We anticipate a significant year-over-year increase in global oil demand of 1.6 million barrels a day in the first quarter of 2025, primarily boosted by … demand for , kerosene and LPG,” they said in a note on Friday.
Meanwhile, the premium on the front-month Brent contract over the six-month contract reached its widest since August this week, potentially indicating supply tightness at a time of rising demand.
Inflation worries are also delivering a boost to prices, said Saxo Bank’s Hansen. Investors are growing concerned about Trump’s planned tariffs, which could drive inflation higher. A popular trade to hedge against rising consumer prices is through buying oil futures.
Oil prices have rallied despite the U.S. dollar strengthening for six straight weeks, making crude oil more expensive outside the United States.
By Karen Braun
NAPERVILLE, Illinois (Reuters) -If anything can derail a price rally, it is a curveball from the U.S. Department of Agriculture.
Chicago corn futures have ticked slightly lower to start the year, but they had climbed nearly 12% in the final two months of 2024, an unusually strong late-year run.
Speculators now hold their most bullish corn view in two years, and luckily for them, the trade has already accepted that last year’s U.S. corn yield was a whopper.
Friday will feature USDA’s biggest data release of the year, with primary focus on the most recent U.S. corn and soybean harvests. U.S. quarterly stocks, U.S. winter wheat seedings and routine global supply and demand updates will also compete for attention.
U.S. CORN AND BEANS
On average, analysts peg U.S. corn yield at 182.7 bushels per acre, down from 183.1 in November. The trade estimate is more than 5 bushels above last year’s record and above USDA’s initial trendline yield for the first time in six years.
Bearish yield outcomes are less likely when the estimates are already large, and only four of 19 polled analysts see corn yield rising from November. However, the range of trade estimates (2.4 bpa) is smaller than usual, flagging the potential for surprise.
In the last decade, analysts anticipated the wrong direction of U.S. corn yield in January only once (2019). They did so three times for soybean yield (2016, 2019, 2022).
But bets are somewhat off for U.S. soybean yield outcomes because USDA’s slashing of the forecast in November was the month’s largest cut in 31 years. Trade estimates indicate some uncertainty around U.S. soybean production as the ranges for both yield and harvested area are historically wide.
Regardless, U.S. soybean supplies are expected to remain ample and at multi-year highs. However, USDA last month pegged 2024-25 U.S. corn ending stocks below the prior year’s level for the first time.
If USDA cuts U.S. corn ending stocks on Friday as expected, it would be the agency’s seventh consecutive monthly reduction. Such a streak has not been observed in at least two decades, reflective of the strong demand that has recently lifted corn prices.
From a market reaction standpoint, these demand dynamics could be somewhat insulating if the U.S. corn crop comes in larger than expected. The last two times CBOT corn had a distinctly negative reaction on January report day were 2012 and 2024, the latter sparked by a huge yield above all trade estimates.
U.S. WHEAT
USDA will not officially issue 2025-26 outlooks until May, but the wheat market will receive its first piece of 2025-26 U.S. crop intel on Friday with the winter wheat planting survey. Total (EPA:) U.S. winter wheat acres are pegged at 33.37 million, very close to both last year and the five-year average.
Analysts have had a rough time anticipating the planting survey in the last two years, coming in almost 1.4 million acres too high last year but lowballing by nearly 2.5 million acres in 2023.
Wheat traders have struggled to find viable bullish narratives despite wheat stocks among major exporters seen dropping to 17-year lows, so another big miss in the U.S. wheat acreage could either support or undermine the recent sentiment.
SOUTH AMERICA
The U.S. crops will probably dominate the headlines on Friday, but it is not too early to watch out for forecast changes in South America. Analysts see USDA upping Brazil’s 2024-25 soybean harvest to a record 170.28 million metric tons from the previous 169 million.
USDA has increased Brazil’s soy crop in three of the last eight Januarys, both on area and yield improvements, and many industry participants have already been factoring in a number north of 170 million tons.
For Argentina, there are already fears that ongoing dry weather could eventually warrant more significant cuts to soybean and corn crops than are anticipated for Friday. American and European weather model runs on Thursday remained stingy with the rainfall over the next two weeks.
USDA already hiked Argentina’s soybean output last month on higher area. The agency increased the crop last January but reduced it in the prior three Januarys. Current crop conditions are slightly worse than a year ago but better than in the prior three years.
Karen Braun is a market analyst for Reuters. Views expressed above are her own.
Investing.com– Oil prices steadied Thursday as traders digested data showing an unexpected increase in US product inventories, while weak economic data from top importer China weighed.
At 05:25 ET (10:25 GMT), expiring in March gained 0.1% to $76.25 a barrel, while rose 0.1% to $73.37 a barrel.
The crude benchmarks had slumped more than 1% on Wednesday, but trading ranges, and volumes, are likely to be limited throughout Thursday with the US market closed to honor former President Jimmy Carter, ahead of a state funeral later in the session.
China inflation muted in December
Chinese inflation, as measured by the , remained unchanged in December, while the shrank for a 27th consecutive month, data showed on Thursday.
The reading pointed to limited improvement in China’s prolonged disinflationary trend, even as the government doled out its most aggressive round of stimulus measures yet through late-2024.
China is the world’s biggest oil importer, and has been a key source of anxiety for crude markets. Traders fear that weak economic growth in the country will eat into oil demand.
The country is also facing potential economic headwinds from the incoming Donald Trump administration in the US, as Trump has vowed to impose steep trade tariffs on Beijing.
US oil product inventories rise sharply
U.S. gasoline and distillate inventories grew substantially more than expected in the week to January 3, government data showed on Wednesday.
inventories grew 6.3 million barrels against expectations of 0.5 mb, while grew 6.1 mb on expectations of 0.5 mb.
Overall crude also shrank less than expected, at 0.96 mb, against expectations of 1.8 mb.
The build in product inventories marked an eighth straight week of outsized product builds, and spurred concerns that demand in the world’s biggest fuel consumer was cooling.
While cold weather in the country spurred some demand for heating, it also disrupted holiday travel in several areas.
EIA data also showed that US imports from Canada rose last week to the highest on record, ahead of incoming U.S. president Donald Trump’s plans to levy a 25% tariff on Canadian imports.
Canada has been the top source of U.S. oil imports for many years, and supplied more than half of the total U.S. crude imports in 2023.
Strength in the also weighed on crude prices, as the greenback shot back up to more than two-year highs on hawkish signals from the Federal Reserve.
A strong dollar pressures oil demand by making crude more expensive for international buyers.
(Ambar Warrick contributed to this article.)
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