Recent Articles

Brent crude up $1 to over $60.50 as global markets firm

Filed in Prices by on 3 March 2015

Brent crude oil prices rose more than a dollar to above $60.50 a barrel on Tuesday, tracking firmer Asian markets, but analysts warned the market remained oversupplied. Most Asian stock markets edged up on Tuesday, bolstered by a record day on Wall Street, while a resurgent yen helped knock the U.S. dollar index off an 11-year high, making commodities priced in the greenback slightly cheaper for holders of other currencies. [MKTS/GLOB] Data showing China’s January crude oil throughput climbed 0.6 percent on year to 39.35 million tonnes, or 9.27 million barrels per day, also supported the oil market. Front-month Brent futures LCOc1 were trading up $1 at $60.54 a barrel by 0632 GMT, just off the day’s high of $60.74. U.S. WTI futures CLc1 were up 42 cents to at $50.01 a barrel. A drop in U.S. rig counts is also boosting oil prices, analysts said. [...]

U.S. Oil Prices Fall

Filed in Prices by on 3 March 2015

U.S. oil prices fell Monday on concerns about a continued oversupply of crude, paring earlier gains. Light, sweet crude for April delivery settled down 17 cents, or 0.3%, to $49.59 a barrel on the New York Mercantile Exchange. Futures rose above $51 a barrel earlier in the session after a widely watched forecaster said crude supplies in a key storage hub grew by a smaller-than-expected amount last week. Data service Genscape Inc. reported that oil inventories in Cushing, Okla., grew by 1.39 million barrels in the week. Oil equipment stands in Texas. U.S. oil futures prices on Monday gained. Supplies in Cushing have grown for 12 straight weeks, often by more than two million barrels in a week, according to the Energy Information Administration. Cushing is the delivery point for the benchmark U.S. oil-futures contract, so U.S. oil prices are sensitive to supply levels at the storage hub. In [...]

Oil falls more than 1 percent on dollar, supply concerns

Filed in Prices by on 3 March 2015

Oil dropped more than 1 percent on Monday, with Brent slipping to around $62 a barrel, depressed by a stronger dollar and a rise in Libyan crude output. The U.S. dollar hit an 11-year high against a basket of currencies after a rate cut in China dented the Chinese yuan and also hit emerging Asian currencies. [FRX/] Brent crude hit a low of $61.78 a barrel and was at $62.08 by 0910 GMT (4.10 a.m. EST), down 50 cents. Front-month Brent jumped 18 percent in February, the largest monthly rise since May 2009. U.S. crude was down 55 cents to $49.21 a barrel. Disruption to oil supplies from members of the Organization of the Petroleum Exporting Countries (OPEC) has helped support crude with lower output from Libya and Iraq in the first couple of months of this year. But output from several OPEC countries may be [...]

Natural Gas Futures Slip as Warmer Weather Appears in Forecast

Filed in Prices by on 3 March 2015

Natural gas futures edged down Monday as above-normal temperatures began appearing in extended weather forecasts, rolling back expectations of demand for gas-fired heating demand as winter weather fades. Natural gas for the front-month April contract fell 3.6 cents, or 1.3%, to $2.698 a million British thermal units on the New York Mercantile Exchange. The session opened in the red and turned briefly positive midmorning but sold off through the rest of the day. After a frigid January and February, a growing number of forecasters are calling for a warming for much of the U.S. in mid-March. Energy data firm Genscape Inc. on Monday called for a “huge” turnaround by mid-March and warmer-than-normal temperatures in the Northeast. “Domestic forecasts are calling for warm temperatures across the eastern seaboard during mid-March, effectively heralding the end of winter,” research firm Gelber & Associates said in a note. If the forecasts prove accurate, [...]

It’s no JK: Oil spread blow-out portends new price slump

Filed in Prices by on 3 March 2015

Another sharp dive in oil prices may be nearer than you think, according to traders who see the market flashing warning signs that vital Oklahoma storage tanks will fill up even sooner than expected. While benchmark U.S. crude oil futures still appear to be holding firm after trading at around $50 a barrel for the past month or so, the spread between first- and second-month oil futures collapsed last week, with prompt prices diving by more than $1 to their deepest discount in four years. Shorthanded as “JK” in market jargon, U.S. West Texas Intermediate for April delivery (known as “J”) were $2.38 a barrel cheaper than those for May (“K”) on Friday, a gap that likely signals the early onset of another milestone in the great oil supply glut, running out of space in Cushing, Oklahoma, delivery point for the New York Mercantile Exchange [...]

L-Shaped Oil Recovery Flattens V-Shaped Market Optimists

Filed in Prices by on 3 March 2015

An employee works at the base of drill pipes on an oil drilling derrick in the Salym Petroleum Development oil fields near the Bazhenov shale formation in Salym, Russia. Some producers are still counting on oil rebounding above $60 by the end of the year, and then to continue rising. Photographer: Andrey Rudakov/Bloomberg (Bloomberg) — Get ready for an L-shaped oil recovery. A growing consensus is emerging from the likes of BP Plc, the International Energy Agency, shale wildcatters and even the Saudis that a near-term recovery to $100-a-barrel crude isn’t in the cards. Instead, expect a range of $50 to $60 for at least the next few years. When oil prices plunged sharply in 2008, they rebounded almost as quickly. Several months ago, industry and government touted the same U or V-shaped recovery this time out. On closer examination, a new factor in the marketplace — shale oil [...]

Could Oil Prices Plummet A Second Time?

Filed in Prices by on 3 March 2015

Are oil prices heading for a double dip? The surge in shale production has produced a temporary glut in supplies causing oil prices to experience a massive bust. After tanking to a low of $44 per barrel in January, falling rig counts and enormous reductions in exploration budgets have fueled speculation that the market will correct sometime later this year. However, there is a possibility that the recent rise to $51 for WTI and $60 for Brent may only be temporary. In fact, several trends are conspiring to force prices down for a second time. Drillers are consciously deciding to delay the completion of their wells, holding off in hopes that oil prices will rebound, according to E&E’s EnergyWire. The decision to put well completions on hold could provide a critical boost to the ultimate profitability of many projects. Higher oil prices in the months ahead will provide companies [...]

Glencore Paints Weak Outlook for Global Commodity Prices in 2015

Filed in Prices by on 3 March 2015

Glencore, the world’s largest publicly traded commodities house, painted a weak outlook for raw materials prices this year, saying supply of iron ore, oil and food commodities is likely to run above demand. Chief Executive Officer Ivan Glasenberg said global economic growth — traditionally the main driver of commodities consumption — remains lackluster. “The gradual process of normalization following the financial crisis has continued, but at a slower pace than many expected,” Glasenberg said in an earnings statement on Tuesday. “Some of the most important legacies of the crisis continue to drag on, including those relating to Europe.” The views of Glencore are closely watched in the commodities market as the company operates one of the largest trading operations in the world, spanning raw materials from copper to soybeans, oil and sugar. The Baar, Switzerland-based company was particularly bearish about iron ore, saying the market for the [...]

Exports, revenues increase in February

Filed in Iraq by on 3 March 2015

Iraq’s oil exports increased in February, despite poor weather in the south, giving the country a needed boost in revenues.Oil exports from southern Iraq actually slipped compared to January, according to Oil Ministry data, but that decrease was offset by higher sales through the Turkish port of Ceyhan, of oil exported in collaboration with the autonomous Kurdistan Regional Government (KRG).A turnaround in oil prices also helped relieve some pressure on Iraq’s budget.Iraqi crude of …

Iraq Begins Offensive to Recapture Tikrit From ISIS

Filed in Iraq by on 3 March 2015

The Iraqi military, alongside thousands of Shiite militia fighters, began a large-scale offensive on Monday to retake the city of Tikrit from the Islamic State, a battle that could either become a pivotal fight in the campaign to reclaim north and west Iraq or deepen the country’s bloody sectarian divide. Iraqi state television announced the beginning of the offensive Monday morning, a day after Prime Minister Haider al-Abadi visited the forces massed on Tikrit’s outskirts and delivered a speech in which he said “zero hour” for the liberation of Tikrit was at hand. While visiting Samarra, a town near Tikrit, on Sunday, Mr. Abadi promised amnesty to local residents who had been forced to join the Islamic State. But he said it was the last chance for them to lay down their arms and assist the security forces in pushing out the militants. It is not the [...]

U.S. Steers Clear of Tikrit, Cites Iran Role in Support of Iraqis

Filed in Iraq by on 3 March 2015

Iraq’s latest push to retake the Sunni city of Tikrit from Islamic State extremists has thrown a new spotlight on the role being assumed by Iran in assisting Baghdad in its fight to regain control of the country. U.S. officials said Iran is supporting the offensive to retake Tikrit , supplying artillery, rocket fire and aerial drones. Islamic Revolutionary Guard Corps, or IRGC, fighters were on the ground with Iraqi units, mostly operating artillery and rocket batteries, according to a U.S. military official. At the Pentagon on Monday, Col. Steve Warren, a Defense Department spokesman, said the U.S. wasn’t providing assistance in the fight to retake Tikrit. The U.S. hasn’t conducted airstrikes [...]

Turkey eyes oil in northern Iraq

Filed in Iraq by on 3 March 2015

Agreements with Iraqi administrations open the door for Turkish oil exploration in the Kurdish north, the Turkish energy minister said Monday. “We have agreements with Baghdad and [the government in] northern Iraq,” Turkish energy minister Taner Yildiz said. “In the frame of these agreements, we will explore for oil there.” The minister offered no estimate of the reserve potential in targeted fields in the Kurdish north of Iraq, nor did he outline which companies would carry out the work. Though suspended in response to payment rows with the Kurdistan Regional Government, British energy company Gulf Keystone Petroleum has shipped tens of thousands of barrels of oil across the border to Turkey. Yildiz [...]

U.N. meets rivals in oil-rich Libya

Filed in Libya by on 3 March 2015

hough some oil operations in the country have resumed, the U.N. Support Mission in Libya said it was calling for a peaceful solution to divisive crises. Disputes between rival Libya governments, coupled with increased violence attributed to Islamic State militants, have spilled over into the oil sector. British energy company BP said in a much-watched annual report published last month that long-term production issues may result from the lingering violence. The U.N. Support Mission in Libya said it met with rival leaders to discuss ways to advance political dialogue and cease-fire proposals . “The participants agreed on the principle of a ceasefire and underlined the need to end the bloodshed in Libya and engage in dialogue,” [...]

What Sanctions Have Done to Iran’s Economy

Filed in Iran by on 3 March 2015

Sanctions by the U.S. and its allies, designed to pressure Iran into abandoning its nuclear program, have left Iran largely isolated, but some House Republicans argue that more pain needs to be inflicted to get results. They invited Israeli Prime Minister Benjamin Netanyahu to address a joint session of Congress on Tuesday to make that case. What have sanctions done to Iran so far? A  January report by Kenneth Katzman, a specialist in Middle East affairs at the Congressional Research Service, offers a dramatic snapshot of the squeeze: In every year from 1995 to 2012, Iran enjoyed at least a measure of economic growth. Then 2013 happened. Conditions improved slightly in 2014, with gross domestic product growing 1 percent to 1.5 percent. That followed an interim agreement, reached in November 2013, that eased some of the sanctions in exchange for a temporary pause to aspects of Iran’s nuclear [...]

Iran President Rouhani: Lift sanctions over nuclear talks

Filed in Iran by on 3 March 2015

Tehran says it’s time to lift sanctions against the oil-rich country imposed in response to nuclear concerns, though a new U.N. report raises questions. Iran and members of the international community are working to resolve long-standing issues over the country’s controversial nuclear program. A sanctions package from November 2013 allows Iran to export some crude oil in exchange for concessions on nuclear research. Iranian President Hassan Rouhani said sanctions on his country should be “lifted all at once” because of its commitment to nuclear talks . “Iran has always honored its [...]

The Nuclear Talks With Iran, Demystified

Filed in Iran by on 3 March 2015

Iran’s Supreme Leader Ayatollah Ali Khamenei told his country in 2013 that economic sanctions will never force Iran into unwelcome concessions over nuclear development. Office of the Iranian Supreme Leader, via Associated Press What the West Wants President Obama and Secretary of State John Kerry have said they will not sign an agreement that would allow Iran to produce enough fuel for a nuclear weapon in less than a year. The United States wants rigorous inspections and limits on Iranian nuclear facilities, including the removal of enriched uranium fuel. Iran’s ability to produce nuclear fuel would be strictly limited over 10 to 15 years. “We want to recognize the main goal here is to prevent Iran from getting a nuclear weapon. And on that, Israel and the United States agree.” John Kerry United States Secretary of State What Iran Wants Iran says it needs to be able to produce [...]

Kerry Is Pushing for Agreement in Iran Nuclear Talks

Filed in Iran by on 3 March 2015

WASHINGTON — They have spent long hours alone together. They exchange private emails. Their walk along the Rhone River in Geneva in January so unnerved hard-line lawmakers in Tehran that they signed a petition fretting about the duo’s unseemly “intimacy.” On Sunday, Secretary of State John Kerry flew to Switzerland to meet again with Mohammad Javad Zarif, the Iranian foreign minister who earned a Ph.D in international law and policy from the University of Denver, to try to negotiate the very accord that Prime Minister Benjamin Netanyahu of Israel arrived in Washington that same day to denounce. As the deadline approaches for what could be one of the most important and divisive international agreements in decades, Mr. Kerry has become a driving force behind the complicated, seven-nation talks to limit Iran ’s nuclear program . But with so much at stake, Mr. Kerry’s relentless negotiating style and determination to [...]

UN nuclear watchdog says Iran still withholding key information

Filed in Iran by on 3 March 2015

The head of the United Nations’ nuclear watchdog said Monday that Iran had still not handed over key information to his staff, and that his body’s investigation into Tehran’s atomic program could not continue indefinitely. “Iran has yet to provide explanations that enable the agency to clarify two outstanding practical measures,” chief Yukiya Amano told the International Atomic Energy Agency’s (IAEA) Board of Governors in Vienna, echoing a report seen by Reuters last month. The two measures relating to alleged explosives tests and other measures that  might have been used for bomb research  should have been addressed by Iran last August. “The Agency is not in a position to provide credible assurance about the absence of undeclared nuclear material and activities in Iran, and therefore to conclude that all nuclear material in Iran is in peaceful activities,” Amano said. The West has related concerns that Iran wants to develop nuclear warheads. Tehran has vehemently denied those allegations, saying [...]

Saudi king keeps close hand on oil in remodelling strategic team

Filed in Saudi Arabia by on 3 March 2015

Saudi Arabia’s subtle change of energy policymaker line-up since the accession of new King Salman in late January appears to give the monarch’s inner circle a firmer hand on the kingdom’s oil strategy than previous rulers have enjoyed.     The most notable change was the promotion of the king’s son Prince Abdulaziz bin Salman, long a member of the No. 1 crude exporter’s OPEC delegation, to the role of deputy oil minister from assistant oil minister, a post he had held for many years.     On the same day, King Salman formed a new body replacing the Supreme Petroleum Council and appointed another son, Prince Mohammed bin Salman, to head the new Supreme Council for Economic Development.     There are no indications that those moves will lead to changes in the fundamental way the kingdom makes its oil decisions or diminish the influence of veteran oil [...]

Researchers Link Syrian Conflict to a Drought Made Worse by Climate Change

Filed in Climate, Syria by on 3 March 2015

Drawing one of the strongest links yet between global warming and human conflict, researchers said Monday that an extreme drought in Syria between 2006 and 2009 was most likely due to climate change , and that the drought was a factor in the violent uprising that began there in 2011. The drought was the worst in the country in modern times, and in a study published Monday in The Proceedings of the National Academy of Sciences , the scientists laid the blame for it on a century-long trend toward warmer and drier conditions in the Eastern Mediterranean, rather than on natural climate variability. The researchers said this trend matched computer simulations of how the region responds to increases in greenhouse-gas emissions, and appeared to be due to two factors: a weakening of winds that bring moisture-laden air from the Mediterranean and hotter temperatures that cause more evaporation. Colin P. [...]

Nigeria: Fuel Scarcity Worsens in Abuja As NNPC Promises Improved Supply

Filed in Nigeria by on 3 March 2015

 The fuel crisis in Abuja worsened weekend, as many of the petrol stations across the Federal Capital Territory, FCT, were shut down, leaving motorists stranded. This was in spite of claims by the Nigerian National Petroleum Corporation, NNPC, on Friday, that it is injecting about 688 million of Premium Motor Spirit, PMS, into the market. Motorists had to resort to the black market‎, where roadside petrol sellers now sell the commodity for as high as N250 per litre. However, the NNPC, Sunday, promised that it is working to ensure that the situation is addressed quickly and assured Nigerians that the fuel supply situation will improve in the coming days. Responding to enquiries from Vanguard, spokesperson for the NNPC, Mr. Ohi Alegbe, said, “On Friday, we had stated that in 48 hours we will wet the market with 688 million litres of petrol. Distribution of products is by [...]

Venezuela Tells U.S. to Reduce Embassy Staff

Filed in Venezuela by on 3 March 2015

With diplomatic relations fraying rapidly between the United States and Venezuela , the government of President Nicolás Maduro has given the American Embassy here 15 days to come up with a plan to drastically shrink its staff, Venezuela’s foreign minister announced Monday. Mr. Maduro has repeatedly accused the United States of backing a plot to overthrow him, and on Saturday he announced a series of diplomatic measures that he said were intended to halt American meddling. He said the United States would have to reduce the number of American officials at its embassy to a number similar to the staff at the Venezuelan Embassy in Washington. He said there were 100 American officials here and just 17 Venezuelan officials in Washington, although those numbers have not been verified by the State Department. “Regarding the reduction to 17 officials with which the Embassy of the United States [...]

As Venezuela coffee output sinks, it swaps oil to import Nicaraguan beans

Filed in Venezuela by on 3 March 2015

Venezuela, once a proud exporter of premium coffee, has been reduced to swapping crude oil for growing volumes of Nicaraguan coffee beans to make sure worsening economic turmoil does not prevent people from getting their caffeine fix. For the first time on record, coffee imports this year will exceed the bean output of Venezuela’s centuries-old coffee industry, according to U.S. government estimates. The South American country’s shift from net coffee exporter to substantial importer has altered flows in regional markets, boosting prices for some varieties of coffee. It is also another sign of how the collapse in crude oil prices, and resulting pressures on an already deeply troubled Venezuelan economy, has forced the government of the OPEC member to take extraordinary measures to keep supermarket shelves stocked with basic goods. Falling coffee production and near-record demand has forced it to buy more higher-priced foreign beans, according to Nicaragua’s export figures and interviews with producers and traders in Venezuela [...]

Falkland Oil & Gas Says Rig Moved to Drill 1st Well on Zebedee Prospect

Filed in Falklands by on 3 March 2015

Falkland Oil & Gas Ltd.(FOGL.LN) said Tuesday that the drilling unit Eirik Raude has arrived in the North Falkland Basin and will shortly start drilling the first well on the Zebedee prospect. This is part of a six-well program that will see two wells drilled in the NFB then one to the south of the islands, followed by two more in the north and a final slot in the south. The project is being developed with Rockhopper Exploration PLC (RKH.LN). Write to Alex MacDonald at

Beijing Quietly Curbs Discussion of Documentary on Air Pollution

Filed in Air Quality, China by on 3 March 2015

Chai Jing released an online documentary Saturday about air pollution. After the film was viewed some 100 million times, government censors stepped in to tamp down discussion about the film. Above, Ms. Chai is seen in a file photo from 2012 at her book release in Beijing Photo: Zuma Press BEIJING—A deeply emotive documentary on air pollution by a well-known journalist was quickly praised by a top government official, but after it drew some 100 million views online over the weekend, censors stepped in to tamp down the buzz, according to several accounts. Produced by former state television broadcaster Chai Jing, “Under the Dome” is a bleak look at the state of the Middle Kingdom’s skies and an unhappy commentary on how government efforts to target the problem have failed. Ms. Chai decided to investigate pollution after the birth of her daughter, who was diagnosed with a benign [...]

Billionaire Lawmakers Ensure the Rich Are Represented in China’s Legislature

Filed in China by on 3 March 2015

Lawmakers in much of the world are often accused of being in the pockets of billionaires. But there’s a difference in China . Here, the lawmakers are the billionaires. Among the 1,271 richest Chinese people tracked by the Shanghai-based Hurun Report, a record 203, or more than one in seven, are delegates to the nation’s Parliament or its advisory body, which will convene for their yearly joint session this week in Beijing. According to figures released by the Hurun Report on Monday, the delegates’ combined net worth is $463.8 billion, more than the annual economic output of Austria. American lawmakers are poor by comparison. According to figures provided by the Center for Responsive Politics, a Washington-based group that tracks money in American politics, the richest person in any of the United States government’s three branches, Representative Darrell Issa, a California Republican, would rank as only the [...]

Bakken Rigs Count Down to 109

Filed in Shale Oil by on 3 March 2015

The Bakken-Three Forks rig count decreased by 12 t0 109 rigs running across our coverage area by the end of last week. In recent Bakken news, Governor Dalrymple of North Dakota signed legislation that grants massive emergency funding to counties and cities statewide in order to bolster the lagging infrastructure. The bulk of the money is targeted to fix roadways and bridges that have not been able to keep up with the increased traffic of heavy oil field equipment that the shale boom has brought to the Bakken area. Read more: Governor Dalrymple Commits to Infrastructure The U.S. rig count fell another 43 to 1267 rigs running by the end of last week. A total of 280 rigs were targeting natural gas (down nine from the previous week) and 986 were targeting oil in the U.S. (33 less than the previous week). [...]

Reality hits North Dakota’s pricey apartment market; rents drop

Filed in Shale Oil by on 3 March 2015

It is getting cheaper to rent an apartment in North Dakota’s oil patch. Prices, which only last year rivaled levels in New York City and Geneva, have slipped about 15 to 20 percent in the past two months as dozens of new apartment buildings opened in Williston, Watford City and other oil hub cities. Growth in demand has slipped because the plunge in crude oil prices has led to cuts in capital spending by energy producers.     There are still about 1,800 energy-related jobs unfilled in the No. 2 U.S. oil-producing state, and there is still demand for apartments. But the accommodation shortage is nothing like it was when the state’s oil boom began six years ago. As new developments start leasing, tenants are able to negotiate lower rents. “You’re starting to see prices fall this year as more units come online,” said Terry Metzler [...]

CP Rail CEO Says Biggest Crude-by-Rail Fear Is Terrorism

Filed in Railroads by on 3 March 2015

Hunter Harrison, Canadian Pacific Railway Ltd.’s chief executive officer, said his greatest fear in moving crude by rail is the prospect of a terrorist attack on the company’s trains. “That’s what concerns me more because it can be planned to do the worst possible damage,” Harrison told reporters after a speech in Toronto. Canadian and U.S. transportation regulators are drafting tougher standards for oil tank cars as record volumes of the commodity are moving across the continent from oil fields in Western Canada and the U.S. New regulation was prompted by the explosion in Lac Megantic, Quebec, in 2013 that killed 47 people. There have been recent incidents too. Last month, a CSX Corp. train carrying crude derailed and exploded in West Virginia shortly after a derailed Canadian National Railway Co. train caught fire near Gogama, Ontario. CP has taken “quantum leaps” to reduce spills by improving [...]

California Beach Community Prepares for High-Stakes Vote on Oil Drilling

Filed in USA by on 3 March 2015

This quaint and quirky seaside community south of Los Angeles has had a conflicted relationship with the oil industry for close to a century. It has variously approved oil drilling, banned it, approved it and prohibited it again. During one yes-on-oil stretch, it contracted with an energy company to put 34 wells on a 1.3-acre city maintenance yard a few blocks from a stretch of beach that normally bustles with surfers and swimmers. On Tuesday, the residents of Hermosa Beach are going to vote yet again on an oil and gas drilling initiative — whether to allow a contract with the energy company E&B Natural Resources Management to proceed despite a current drilling ban. The contract, which could mean hundreds of millions of dollars for the local government, received final approval from the City Council in 1992, but it has been in limbo ever since. [...]

Pennsylvania governor asks Obama for stronger crude-by-rail rules

Filed in Railroads by on 3 March 2015

Noting that 60-70 trains/week carry Bakken crude oil across Pennsylvania to the Philadelphia area or other East Coast refineries, Gov. Tom Wolf (D) asked US President Barack Obama for stronger federal regulations to prevent derailments and improve safety. “I have already taken actions to address this issue including holding emergency trainings, participating in meetings with executives, and tasking my administration to put plans in place to both prevent accidents and mitigate impacts,” Wolf separately said on Feb. 27. “We also need expedited federal regulatory action in several areas along with a greater commitment to funding inspection and enforcement,” Wolf said. “We cannot afford to wait for a major incident before taking action.” In his Feb. 26 letter to Obama, Wolf called for consistent national standards to reduce Bakken crude’s volatility prior to transport, further reduction of trains’ speed limits through urban areas, more federal [...]

U.S. shale producers get no relief from rising Brent: Kemp

Filed in Shale Oil by on 3 March 2015

More than ever before, U.S. shale producers are becoming the victims of outdated restrictions on the export of crude oil from the United States. Export controls have ensured the most oversupplied part of the global oil market is at home in the United States. The main beneficiaries are rival producers in the Middle East and elsewhere able to obtain higher international prices thanks to the export ban. U.S. shale producers have received almost no benefit from the improvement in international oil prices since the middle of January. Benchmark Brent prices have risen around $16 per barrel since hitting their recent low on Jan 13. But prices for shale producers are tied to the domestic marker WTI which has risen by only $4 per barrel over the same period ( ). In the middle of January, posted prices for shale producers in Texas and North Dakota [...]

Oil Shock Worsens Political Fight Hampering Norway’s Premier

Filed in Norway by on 3 March 2015

Norway’s Prime Minister Erna Solberg risks being left in the lurch by her coalition partners as she seeks to steer western Europe’s biggest oil producer through a slump in crude prices. The 54-year-old called a meeting with her support parties for Tuesday to discuss a mounting discord in her coalition and “the challenges that Norway faces.” Tensions inside the coalition are growing as Finance Minister Siv Jensen’s Progress Party is increasingly at odds with the government’s two support parties over everything from economic and tax policies, to welfare spending and immigration. Solberg’s dilemma is that she needs “support from two centrist parties in parliament that basically disagree with the government on a lot of issues,” said Johannes Bergh, a researcher at the Institute for Social Research in Oslo. “That’s caused a lot of friction.” Support for the minority government, [...]

Russia Agrees Dispute Over East Ukraine Gas Won’t Endanger EU Supply

Filed in Russia, Ukraine by on 3 March 2015

The energy ministers of Russia and Ukraine agreed Monday that a dispute over natural-gas deliveries to some rebel-controlled territories in eastern Ukraine won’t affect supplies to the rest of the country and the European Union. The spat between Ukrainian state gas company OAO Naftogaz and its main supplier, Russia’s OAO Gazprom , had endangered an EU-mediated deal that was meant to secure gas supplies during the cold winter months. It also raised questions on whether the two sides would be able to negotiate a follow-up arrangement to regulate deliveries over the summer months once the winter deal expires at the end of March. The agreement, following talks between the two ministers in Brussels, doesn’t resolve the question of who will ultimately pay for gas delivered by Gazprom to the Donetsk and Luhansk regions but not authorized by Naftogaz. Russian has been backing the rebels in those regions. The pact [...]

Ohio Sues BP For More Than $33 Million

Filed in USA by on 3 March 2015

Ohio is suing oil and gas company BP for more than $33 million, alleging it double dipped by taking state funds and money from insurers to clean up accidental leaks from underground storage tanks at hundreds of its gas stations around the state. The state’s attorney general and the Ohio Petroleum Underground Storage Tank Release Compensation Board filed the lawsuit Monday. The board administers a fund used as a last resort when tank owners lack coverage or don’t accept insurance money. The lawsuit alleges London-based BP wrongfully obtained $33.3 million in reimbursements from the fund, saying it had no insurance for the leaks when it often accepted insurance money for the same releases. BP PLC spokesman Jason Ryan says the company acted in good faith and will defend itself against the lawsuit. —Copyright 2015 Associated Press

Crude on Derailed Train Contained High Level of Gas

Filed in Railroads by on 3 March 2015

The crude oil aboard the train that derailed and exploded two weeks ago in West Virginia contained so much combustible gas that it would have been barred from rail transport under safety regulations set to go into effect next month. Tests performed on the oil before the train left North Dakota showed it contained a high level of volatile gases , according to a lab report reviewed by The Wall Street Journal. The oil’s vapor pressure, a measure of volatility, was 13.9 pounds per square inch, according to the Feb. 10 report by Intertek Group PLC. That exceeds the limit of 13.7 psi that North Dakota is set to impose in April on oil moving by truck or rail from the Bakken Shale. Oil producers that don’t treat their crude [...]

Houston Ship Channel closed for more than a day; dozens of ships delayed

Filed in Oil Supply, USA by on 3 March 2015

The Houston Ship Channel remained closed to all traffic due to heavy fog for the second straight day Monday, a Houston Pilots dispatcher said. “We are still closed,” he said. “We closed at 1:35 am (0735 GMT) Sunday.” The dispatcher said the forecast remains gloomy. “It’s not looking too good,” he said. “We may get a small window this afternoon, but it is supposed to get foggy again tonight.” Article continues below… Dirty Tankerwire delivers the most important developments in the dirty tanker market, daily, direct to your desktop. Extensive listings and clear analysis of the latest freight and fixture rates help you effectively analyze the dirty tanker market. The dispatcher said about 60 ships — 30 inbound and 30 outbound — had been delayed as of 7:30 am Monday and clearing out the queue could take some time. “It all depends,” he said. [...]

Low Oil Price May Stifle Deepwater Drilling And Oil Sands But Not Fracking

Filed in Oil Supply, Prices by on 3 March 2015

Saudi Arabia and OPEC may have dropped oil prices to stifle production in the U.S. and other competing nations, but they didn’t drop it enough to stifle the U.S. oil and gas boom from fracking, a senior expert with McKinsey and Company said in Chicago. “If the Saudis think they’re going to put U.S. shale players out of business, they’re probably not, although there will be less drilling,” Joe Quoyeser told about 125 people, mostly graduate students, at Northwestern University’s Kellogg Energy Conference on Wednesday. ”But there are other elements of oil supply that are needed to balance the market that will have a hard time competing at $50 a barrel, including oil sands in Canada and much of the deepwater resources.” Oil sands have to be heated to extract petroleum, a process that requires natural gas. Even at today’s low gas prices, that fixed cost means oil sands only become viable at [...]

Europe Unlikely to Meet Climate Goal, Study Finds

Filed in Climate, Europe by on 3 March 2015

The European Union will fail to meet an ambitious goal of significantly reducing greenhouse gas emissions by 2050 unless it takes more aggressive measures to limit the use of fossil fuels and adopts new environmental policies, according to a report scheduled for release on Tuesday. Although European countries are on track to meet, and even surpass, the goal of reducing 1990-level greenhouse gas emissions by 20 percent by 2020, existing policies are not robust enough to ensure that the 2050 targets are met, the report said. Those targets, scientists have said, are critical to forestalling the most catastrophic effects of climate change , which are linked to carbon emissions caused by human activity. “The level of ambition of environmental policies currently in place to reduce environmental pressures may not enable Europe to achieve long-term environmental goals, such as the 2050 target of reducing greenhouse gas emissions by [...]

Oligarch’s oil deal caught in sanctions crossfire

Filed in Russia, United Kingdom by on 3 March 2015

As first days at work go, Monday was eventful even by the standards of someone as experienced as Lord Browne. The former BP head took over as executive chairman of L1 Energy, a new $10bn oil and gas investment fund backed by Russian billionaire Mikhail Fridman, to find an unfolding row between his oligarch boss and UK energy secretary Ed Davey at the top of his in-tray. The peer, whose appointment completes a remarkable rapprochement with Mr Fridman, a one-time foe, will use his decades of energy industry expertise and extensive contacts book to lead a hunt for partnership deals and acquisitions. The assets acquired by Mr Fridman’s LetterOne group in a €5bn purchase completed on Monday of RWE Dea, the oil and gas arm of Germany’s RWE , are meant to form the cornerstone of an international energy business. There will [...]

Russia Eases Rules on Gas for Rebel-Held Areas of Ukraine — Update

Filed in Ukraine by on 3 March 2015

Russia’s energy ministry said Monday that Ukrainian gas company OAO Naftogaz won’t have to make advance payments for unauthorized gas deliveries to rebel-held regions in eastern Ukraine. Recent deliveries by Russia’s OAO Gazprom to the Donetsk and Luhansk regions will be “taken out of the equation” when calculating prepayments for Naftogaz, the ministry tweeted from its verified Twitter account. “This will be a matter of a separate reconciliation and separate negotiations,” the ministry added. Russian Energy Minister Alexander Novak was in Brussels Monday for European Union-mediated talks with his Ukrainian counterpart. The talks followed complaints from Naftogaz that Gazprom had been supplying gas to rebel-held regions in eastern Ukraine and had reduced deliveries to the rest of the country. Russia has been backing the rebels. Naftogaz claimed that Gazprom was in breach of a supply deal between the [...]

Russia to Avoid Using Global Debt Markets in 2016, Minister Says

Filed in Russia by on 3 March 2015

Russia doesn’t expect to access international debt markets in 2016 after already ruling out issuing foreign bonds in 2015 to help finance its budget deficit, Finance Minister Anton Siluanov said. The country, which has issued more than $22 billion of bonds abroad since 2010, is facing higher borrowing costs in global markets amid U.S. and European Union sanctions after President Vladimir Putin’s annexation of Crimea a year ago. Russia previously planned to borrow as much as $7 billion in 2016 and another $7 billion in 2017, according to the most recent budget approved by Putin. “We should be more realistic and put in our budget internal borrowings as sources” to cover the deficit, Siluanov told reporters Monday in Moscow. Russia’s credit rating was cut below investment grade by Moody’s Investors Service and Standard & Poor’s this year as policy makers struggle to keep economic growth. Russia may [...]

Exxon’s Russia Exposure Surges as Long View Outweighs Sanctions

Filed in Russia, USA by on 3 March 2015

Exxon Mobil Corp. shook off the chill of sanctions and has continued to snap up oil drilling rights in Russia, giving it larger exploration holdings in Vladimir Putin’s backyard than in the U.S. Taking the long view, Exxon boosted its Russian holdings to 63.7 million acres last year from 11.4 million at the end of 2014, according to data from U.S. regulatory filings. That dwarfs the 14.6 million acres of rights Exxon holds in the U.S., which until last year was its largest exploration prospect. While U.S. and European Union sanctions against Russia forced Exxon to shut down an Arctic drilling project in October, the producer is staking claims to areas that [...]

Russia ETF Swells to Record as Ruble Advances Amid Truce

Filed in Russia by on 3 March 2015

Investors are boosting wagers on the largest exchange-traded fund tracking Russian stocks to a record as easing tension in Ukraine and a rebounding ruble lured them back to the cheapest equities in emerging markets. The number of outstanding shares in the Market Vectors Russia ETF soared 14 percent from mid-February to 107.3 million at the end of the month, driving its total assets to $1.88 billion. The fund, which lost half of its value in 2014, has surged 19 percent this year. ETFs focusing on Russian stocks and bonds collected $222.2 million in February, the biggest inflows in emerging markets, data compiled by Bloomberg show. After deserting the nation’s stocks last [...]

Oligarch’s oil deal caught in sanctions crossfire

Filed in Russia, United Kingdom by on 3 March 2015

North Sea oil rig or gas platform As first days at work go, Monday was eventful even by the standards of someone as experienced as Lord Browne. The former BP head took over as executive chairman of L1 Energy, a new $10bn oil and gas investment fund backed by Russian billionaire Mikhail Fridman, to find an unfolding row between his oligarch boss and UK energy secretary Ed Davey at the top of his in-tray. The peer, whose appointment completes a remarkable rapprochement with Mr Fridman, a one-time foe, will use his decades of energy industry expertise and extensive contacts book to lead a hunt for partnership deals and acquisitions. The assets acquired by Mr Fridman’s LetterOne group in a €5bn purchase completed on Monday of RWE Dea, the oil and gas arm of Germany’s RWE , are meant to form the cornerstone of an international energy business. There will [...]

How Much More Economic Pain Can Vladimir Putin Take?

Filed in Russia by on 3 March 2015

It’s been a little more than six months since the full brunt of Western sanctions took force against Russia . The punishment, while slow in coming, has proven devastatingly effective—especially when paired with the crash in oil prices . Last summer, of course, U.S. and European Union officials had no way of knowing an epic oil selloff was right around the corner. But in hindsight the coordination seems uncanny. Oil prices peaked less than a month before the sanctions were announced. By November, the combination of cheap oil and tighter sanctions was bleeding Russia of billions in budget revenue and had cut it off from the world’s largest capital markets. In December, state-owned oil giant Rosneft  had to get a loan backed by the Central Bank of Russia, which is sort of like the U.S. Fed giving a loan to ExxonMobil. Recent news reports suggest Russian President Vladimir [...]

OPEC Puppets and Canada Give Away Their Oil

Filed in Peak Oil by on 3 March 2015

The world is running out of oil. Peak Oil is a reality, all that is open to debate is how fast production will drop off, and how quickly the world will simply run out of oil. The lack of certainty is due to the fact that (as with everything else) we can’t trust the “official” numbers fed to us, with respect to either global production or global reserves. Numbers supplied by Saudi Arabia’s corrupt monarchy have been regarded with deep suspicion, for many years, based on inconsistencies in the numbers themselves, and the high degree of secrecy within the Saudi oil industry. More recently; the massive conspiracy with respect to U.S. “shale oil” has now been exposed, with actual supply being as little as 4% of the fantastic “reserves” claimed by the Shale Charlatans. What does it mean when we live in a world of diminishing (oil) supply, and [...]

Financial collapse leads to war

Filed in Economy by on 3 March 2015

Scanning the headlines in the western mainstream press, and then peering behind the one-way mirror to compare that to the actual goings-on, one can’t but get the impression that America’s propagandists, and all those who follow in their wake, are struggling with all their might to concoct rationales for military action of one sort or another, be it supplying weapons to the largely defunct Ukrainian military, or staging parades of US military hardware and troops in the almost completely Russian town of Narva, in Estonia, a few hundred meters away from the Russian border, or putting US “advisers” in harm’s way in parts of Iraq mostly controlled by Islamic militants. The strenuous efforts to whip up Cold War-like hysteria in the face of an otherwise preoccupied and essentially passive Russia seems out of all proportion to the actual military threat Russia poses. (Yes, [...]

Oil falls more than 1 percent on dollar, supply concerns

Filed in Prices by on 2 March 2015

Oil dropped more than 1 percent on Monday, with Brent slipping to around $62 a barrel, depressed by a stronger dollar and a rise in Libyan crude output. The U.S. dollar hit an 11-year high against a basket of currencies after a rate cut in China dented the Chinese yuan and also hit emerging Asian currencies. [FRX/] Brent crude hit a low of $61.78 a barrel and was at $62.08 by 0910 GMT (4.10 a.m. EST), down 50 cents. Front-month Brent jumped 18 percent in February, the largest monthly rise since May 2009. U.S. crude was down 55 cents to $49.21 a barrel. Disruption to oil supplies from members of the Organization of the Petroleum Exporting Countries (OPEC) has helped support crude with lower output from Libya and Iraq in the first couple of months of this year. But output from several OPEC countries may be [...]

Oil Eases in Asian Trade, Posts Strong February Gains

Filed in Prices by on 2 March 2015

Crude-oil futures slipped in Asian trade Monday but remained strong after ending February on a solid note that helped oil markets snap a seven-month losing streak. Oil market observers are assessing U.S. supply and demand fundamentals, and a flurry of economic data from China over the weekend. On the New York Mercantile Exchange, light, sweet crude futures for delivery in April traded at $49.38 a barrel at 0413 GMT, down $0.38 in the Globex electronic session. Brent crude for April delivery on London’s ICE Futures exchange fell $0.37 to $62.21 a barrel. Gains in Brent crude outpaced Nymex crude last month, with Brent gaining 18% compared to U.S. oil prices that gained 3.2%, pressured by record-high inventory levels. While U.S. crude inventories are set to rise significantly, the market might be disappointed in its impact on current-month prices as high oil-storage levels have a stronger impact [...]