Today in Biofuels Opinion: “There is still no firm indication of precisely what crops or other plants can be used globally as raw material for second generation biofuels.”

Pavel Molchanov, energy analyst with Raymond James: “On the oil side, the global economic crisis means that visibility in regard to demand is minimal.  On December 1, we acknowledged this near-term haziness and reduced our 2009 oil price forecast from $90/Bbl to $60/Bbl, with an average price in 1Q09 of only $45/Bbl.  Our new forecast assumes a 2% decline in global demand, which would be the largest y/y decline since 1982.  Given this weak demand outlook, OPEC’s supply cuts, which now total over 4 MMbpd “on paper”, are key to restoring balance.  However, despite nearly 75% compliance by OPEC members, oil prices continue to trade in the $35-50/bbl range, and further upside will likely wait until the demand outlook clears.”

From Reuters: “In the United States alone over $1.5 billion has been invested developing new generation green fuels and the U.S. wants major volumes of new generation fuels to be consumed in the country by 2022, F.O. Licht managing director Christoph Berg said. But there is still no firm indication of precisely what crops or other plants can be used globally as raw material for second generation biofuels, Berg said. Second generation biofuels are likely to be produced in market-significant volumes around 2015, he said.”

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