The Wall Street Journal: Oil News Roundup: January 23, 2007 4:06 p.m.

Crude-oil futures rallied more than $2 a barrel and briefly topped $55 after the U.S. announced plans to double the size of the Strategic Petroleum Reserve and start purchasing crude oil toward that goal.

Here is Tuesday’s roundup of oil and energy news:

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RENEWABLE FUELS TO STAR IN ADDRESS: As part of his State of the Union proposal on energy, President Bush is expected to call for an increase in U.S. renewable-fuels usage to 17 billion gallons by 2015. He also will propose a new system of regulating passenger-car fuel efficiency that includes new ability for car makers to trade credits from production of more-efficient vehicles to offset sales of less-efficient ones.

•Legacy-Building: In his speech, Mr. Bush will link energy and environmental policy, departing from personal precedent and suggesting an effort to shape his legacy in the last two years of his presidency — though some analysts doubt he’ll make sweeping policy changes to fight global warming, the FT reports (subscription required).

•Schwarzenegger Puts Heat on Washington: Calif. Governor Arnold Schwarzenegger, long a promoter of gaz-guzzling Hummers, has surprisingly taken a lead role in shaping environmental policy in the U.S., the FT says.

•Iraqis Trying to Reach Oil Accord: Iraqi officials are scrambling to appease Kurdish opposition to a new law on handling the nation’s oil revenue, Reuters reports.

•Shell Raises Offer for Canada Unit: Royal Dutch Shell announced plans to raise its offer for the shares in Shell Canada it doesn’t already own by 12.5% to about $7.36 billion after coming under pressure from investors.

•Damaged Ship Leaks 200 Tons of Oil: A damaged ship grounded off the English coast leaked more than 200 tons of oil, leaving a five-mile sheen on the surface of the water and threatening the nearby coastline, officials said Sunday.

•More Kidnappings in Nigeria: Unidentified assailants seized two foreign oil workers in the latest kidnapping in restive southern Nigeria and negotiations were under way for the return of a boatload of Filipinos missing in the area.

•Devon Out of Africa: Oil and gas company Devon Energy said it plans to sell all its assets in West Africa and focus instead on North America, Brazil and China.

•Big Oil Unlikely to Leave Venezuela: While Hugo Chavez’s efforts to assert control over his nation’s hydrocarbon industry might make the oil industry think twice before seeking further opportunities in Venezuela, companies such as Exxon Mobil are unlikely to walk away from the billions they have already sunk into what could be one of the world’s richest oil fields.

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