Announcing in February a $5.5bn bailout for Pemex, Mexico’s troubled national oil company, President Andrés Manuel López Obrador held out a promise of renewal. “If we end corruption, Pemex will be reborn, and this will apply to the country,” he said. The idea that transforming Pemex could transform Mexico is a sign of the central role that national oil companies play in many countries. Crown Prince Mohammed bin Salman has had a similar strategy, putting reform of Saudi Aramco, including its first international bond sale and the planned IPO, at the heart of his ambitious plan to modernise the kingdom’s economy. In more than 25 countries, the national oil company brings in more than 20 per cent of government revenue. In many, their importance extends far beyond their contribution to revenues, as they play critical roles providing jobs, training, technological development and social services.

On a global scale, too, national oil companies (NOCs) are hugely significant. They produce about 85m barrels equivalent of oil and gas every day, representing a little over half of total global output. But considering their importance, NOCs are relatively under-examined. So an initiative from the Natural Resource Governance Institute this week, attempting to make them easier to understand, is very welcome. I mentioned the NRGI last week for its research into the management of mineral wealth in sub-Saharan Africa. Its work, backed by the UK, Norwegian, Swiss and German governments, as well as charitable foundations, makes an important contribution to understanding how countries can improve their management of their oil, gas and minerals.

Its new National Oil Company Database pulls together in a single place a lot of useful information about the finances and operations over 2011-17 of 71 NOCs in 61 countries, from Saudi Aramco to Staatsolie of Suriname and ENH of Mozambique. If you want to know how much KazMunayGas of Kazakhstan paid its government in 2013, this is the place to look. (The answer is $4.94bn.) Everything is presented on a comparable basis, so it is easy to line up different companies to see how their performance differs. If you want more on the methodology, there is a paper that explains it.

As you would expect, there are substantial gaps in the data. Saudi Aramco, for example, shows no financial data before 2016, the first year covered in its bond prospectus. The NRGI argues that this is a big problem, warning that NOCs in general are “dangerously under-scrutinised”. For a sense of why NOCs deserve closer attention, take a look at this chart, adapted from an NRGI report presenting some of its key conclusions from the data. The bars show NOC revenues as a proportion of total government revenues, for the top 15 countries. For the top five, including Socar of Azerbaijan, which does not get a bar because it is literally off the scale, the company brings in more than the government’s entire income.

The blue bars show NOCs that are active around the world, the red bars are ones that are primarily producers in their home countries. Note that some of the most interesting cases are left off this chart, too, because these are 2013 numbers and the data were not available for Saudi Aramco and Iraq’s NOCs. Iraq last year consolidated ownership of nine state-owned groups under a new National Oil Company.

As the NRGI points out, a lack of transparency at such vital institutions can have significant consequences. As well as bringing in a lot of revenue, NOCs spend a lot of money. In countries with a large and influential NOC, “there is a strong risk of the company becoming a state-within-a-state and executing a sort of shadow fiscal policy,” the institute points out. NOCs are sometimes the largest spenders in the public sector, “but often do not go through the typical public sector budgeting or oversight process”. The NRGI’s conclusion: The world needs to promote better reporting from NOCs on their finances and operations, and companies and governments need to develop clear goals, and “benchmark rigorously” against them.

The US seeks to tighten the screws on Iran

Back in November, when the Trump administration issued eight countries with waivers from its newly reinstated sanctions on Iran’s oil exports, it made clear that it was offering only a temporary reprieve. Brian Hook, the Iran lead at the state department, told the Financial Times at the time: “We are very focused on a path to zero as quickly as possible.” This week, the administration followed through on that commitment, saying that the waivers would not be renewed when they expire on May 2, and calling on all countries to stop importing Iranian oil completely, with the aim of stepping up its pressure on Tehran.

The reason the waivers were first granted was to prevent a shock to world oil supplies from suddenly taking Iran’s barrels off the market. In the event, they were almost too successful: added to concerns about slowing growth, they contributed to a steep fall in oil prices in the final quarter of last year, which pushed Opec members and their allies into agreeing new production cuts. This time, partly because of those cuts, the US administration felt more relaxed about trying to drive Iran’s exports to zero, because it expected other producers, particularly Saudi Arabia and the United Arab Emirates, to step in to fill the gap.

It was not immediately clear that that confidence was well-founded. Saudi Arabia welcomed the US move, and Khalid al-Falih, the kingdom’s energy minister, said in a statement on Monday that he would be “be consulting closely with other producing countries and key oil consuming nations to ensure a well-balanced and stable oil market”. On Wednesday, however, he suggested that the market was currently well supplied, and said “I don’t see the need to do anything immediately,” in terms of increasing production. His comments, along with the decision by Germany and Poland to suspend crude imports from Russia because of quality issues, helped drive Brent crude above $75 a barrel for the first time in six months.

Then on Friday, President Donald Trump changed market perceptions on oil prices, telling reporters he had “called up Opec” and said “you’ve got to bring them down” He later tweeted that he had spoken to “Saudi Arabia and others” about increasing their oil production, and “all are in agreement” on that. The Wall Street Journal subsequently reported sources saying that so far Mr Trump had not spoken with Mr Falih or Mohammad Barkindo, Opec’s secretary-general. Brent crude nevertheless ended the week at $72.15 a barrel, roughly where it was seven days ago before the US announced its plan to block all exports of Iranian oil. Russia helped ease concerns in the market, promising that stable oil flows to the EU through the Druzhba export pipeline would resume within two weeks,

The eventual impact on the oil market of the squeeze on Iran’s exports is set to be debated for months to come, however. For one thing, there is no agreement on how much oil the country is exporting today: estimates start at only about 1m b/d, and range all the way up to 1.9m b/d. And as past experience with oil sanctions shows, there is always some leakage through the cracks. Tankers can switch off their Automatic Identification System transponders, making them harder to track, and oil can be transferred from ship to ship to disguise its origin. Hassan Rouhani, Iran’s president, visited Baghdad last month, with the aim of securing Iraq’s help for circumventing US sanctions.

China also suggested it would attempt to defy the sanctions. Its foreign ministry lodged a formal protest with Washington about its move, saying: “The decision from the US will contribute to volatility in the Middle East and in the international energy market.” China’s Global Times, the English language outlet of the People’s Daily, wrote in an editorial that its government’s response was a “tough choice”. It went on: “China should oppose the hegemonic approach of the US, but it can't take the lead in confronting the US on issues involving Iran.”

In brief

State renewable portfolio standards or RPSs, which mandate that a set share of electricity supply should come from sources such as wind and solar power, have played a vital role in developing those industries in the US, but there is still a debate over how cost-effective they are. A new working paper from the Energy Policy Institute at the University of Chicago set off another round of that debate this week with its conclusion that “it appears that the current costs of RPS programmes exceed their benefits”. The paper estimates that RPS policies cost at least $130 a tonne of carbon dioxide emissions avoided, and sometimes as much as $460 a tonne, making them very expensive ways to curb greenhouse gases. That conclusion attracted some criticism, much of which was summed up by Jesse Jenkins of the Harvard Kennedy School in a piece for Axios. The paper’s approach “misrepresents the objectives of RPS policies, which aren’t all about CO2 and are not intended to stand-in for carbon pricing,” he wrote.

Looking further ahead, the Energy Futures Initiative, the think-tank led by former US energy secretary Ernest Moniz, published an analysis of California’s targets for cutting emissions, concluding that they were achievable but “extremely challenging”.

Putting those debates about the US into context, James Temple wrote in the MIT Technology Review about India, warning that its surging economy “could doom climate efforts — unless richer nations step up”. Solar and wind power are booming in India, he wrote, but to cut greenhouse gas emissions “clean energy would need to replace — not simply augment — coal, which currently generates nearly 55 per cent of the nation’s electricity. And that’s not happening anytime soon in one of the world’s fastest growing and fastest urbanising economies.”

Another good piece in the MIT Technology Review this week looked at the troubles of South Korea’s nuclear industry. It had appeared to be emerging as a global player by winning a widely sought contract to build reactors in the United Arab Emirates, but at home it is shutting down older plants and scrapping plans for new ones. The South Korean government has shifted its focus towards renewable energy, aiming to increase it from 7.6 per cent of the country’s electricity supply in 2017 to 30-35 per cent in 2040.

Japan, meanwhile, is heading for another near-total shutdown of its nuclear reactors, because regulators have refused to extend deadlines for completing antiterrorism measures. As of last month, only nine of the country's 57 reactors were in operation, and concerns about nuclear power are still running high following the Fukushima Daiichi disaster of 2011.

The new five-part series Chernobyl, a collaboration between HBO and Sky, starts on May 6. From the trailer, it is clear the series is not going to try to be a judicious assessment of the pros and cons of nuclear power. Our latest understanding about the disaster’s long-term impact was explained by James Conca in Forbes.

China’s Belt and Road Initiative includes some impressive-sounding ambitions for “green development” in the 68 countries that are participating. Those goals were featured at the summit for the initiative in Beijing over the past few days. But in a report for Columbia University’s Center on Global Energy Policy, Jonathan Elkind warned that “to date, all too little greening is actually occurring”.

Two cooling towers from the last coal-fired power plant in Massachusetts were demolished on Saturday.

The UK’s “fracking tsar” has resigned, saying “a perfectly viable industry is being wasted” by excessively restrictive rules related to earth tremors during fracturing operations.

And finally: Perovskites, materials with a particular crystal structure, are widely seen as the best hope for the future of solar power, but they are difficult to work with and hard to stabilise. The answer, as is often the case with people, may be to add caffeine.

Other views

Nick Butler — Shell’s power game

Nastassia Astrasheuskaya and Henry Foy — Polar powers: Russia’s bid for supremacy in the Arctic Ocean

Camilla Cavendish — Climate change protesters are telling us the deadly truth

FT view — Activists ensure climate change is centre stage

Murray Worthy — Big Oil’s $5tn investment is incompatible with Paris deal

Clyde Russell — Australia's pro-coal lobby should heed South Korea warning

Jesse Jenkins — Why carbon pricing falls short

Richard Nephew — The US drive to end Iranian oil exports: Expectations, risks and outcomes

Quote of the week

“This ongoing irresponsible behaviour will no doubt be remembered in history as one of the greatest failures of humankind.” — Greta Thunberg, the Swedish teenage climate activist, was sharply critical of UK energy and transport policy when she met MPs and party leaders in Westminster this week.

Chart of the week

The UK’s energy mix for electricity generation has changed dramatically in the past seven years. Coal power has slumped, while gas-fired generation has increased and renewable energy has boomed. Over the Easter holiday weekend, Britain went without any coal-fired generation for 90 consecutive hours. The government is aiming to close all Britain’s coal-fired power plants by 2025.

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