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Oil prices ease as market downplays supply threat from Yemen

Filed in Prices by on 28 March 2015

Oil prices fell over a percentage point on Friday as traders estimated that the threat of a disruption to world crude supplies from Saudi Arabia-led air strikes in Yemen was low. Goldman Sachs said in an overnight note that the strikes in Yemen would have little effect on oil supplies as the country was only a small crude exporter and tankers could avoid passing its waters to reach their ports of destination. Internationally traded Brent crude futures LCOc1 were trading at $58.44 a barrel at 0211 GMT, down 75 cents from their last settlement. U.S. crude CLc1 was down 88 cents at $50.55 a barrel. Prices soared as much as 6 percent the previous day after a Saudi-led coalition of Arab nations began strikes on Shi’ite Houthis and allied army units who have taken over much of Yemen and seek to oust President Abd-Rabbu Mansour Hadi. […]

U.S. GDP pulls reins on oil prices

Filed in Prices by on 28 March 2015

Weak economic data from the United State pulls oil prices back from spike that greeted pan-Arab military operations in Yemen. Photo by Pavel L Photo and Video/Shutterstock NEW YORK, March 27 (UPI) — Crude oil prices pulled back Friday from sharp gains triggered by conflict in Yemen as U.S. data show a decline in economic growth in the fourth quarter. The Commerce Department said Friday gross domestic product increased at an annual rate of 2.2 percent in the fourth quarter of 2014. That’s down from the 5 percent increase in GDP during the third quarter. Deceleration in GDP growth in the fourth quarter reflected in part an uptick in imports and a downturn in federal government spending. Corporate profits and related indices decreased $30.4 billion in the fourth quarter, compared with an increase of $64.5 billion in third quarter 2014, the Commerce Department said. The slowdown pressured an economy […]

Natural Gas Futures Fall as Warmer Weather Looms

Filed in Prices by on 28 March 2015

Natural gas prices slipped Friday as warmer temperatures crept into the forecasts with the onset of spring, reducing expectations for late-season heating demand that could support the market. The front-month April contract natural gas contract ended down 8.2 cents, or 3.1%, at $2.59 a million British thermal units on the New York Mercantile Exchange, its third consecutive losing session. The April contract expired with the close of trading Friday. The market is bumping along at its lowest levels of the year as the U.S. enters a so-called shoulder season between winter and spring and demand for gas-fired heating falls away. “Going into shoulder season, there’s not a lot of fundamental support for gas prices, and so they’re starting to slide,” said BNP Paribas strategist Teri Viswanath. There were no major revisions to temperature outlooks in the coming days and weeks, but there was a slight warming trend, with above-normal […]

Transocean prepares for challenges ahead

Filed in Oil Supply by on 28 March 2015

Rig services company Transocean is bracing itself for an uncertain and difficult road ahead in the offshore drilling market, its chief executive officer said. Transocean published its 325-page proxy statement for 2015 and annual report for 2014. The release comes as most energy companies have announced plans to cut back on spending for exploration and production as oil prices stay depressed in an era of oversupply. Transocean Interim Chief Executive Officer Ian Strachan said in a statement that, while the company held its ground last year as oil prices fell, this year may be different for the rig builder. “We had significant achievements in 2014,” he said. “However, despite our progress, the offshore drilling market has become increasingly uncertain and, in all likelihood, the next couple of years will remain […]

Yemen Houthi rebels advance despite Saudi-led air strikes

Filed in Yemen by on 28 March 2015

Yemen’s Houthi rebels made broad gains in the country’s south and east on Friday despite a second day of Saudi-led air strikes meant to check the Iranian-backed militia’s efforts to overthrow President Abd-Rabbu Mansour Hadi. Shi’ite Muslim Houthi fighters and allied army units gained their first foothold on Yemen’s Arabian Sea coast by seizing the port of Shaqra 100km (60 miles) east of Aden, residents told Reuters. Explosions and crackles of small gunfire rang out across Aden late on Friday as Houthis made a push on the southern port city’s airport, a witness said. The advances threaten Hadi’s last refuge in Yemen and potentially undermine the air campaign to support him. The spokesman for the Saudi-led operation, Brigadier General Ahmed Asseri, told a news conference in Riyadh that defending the Aden government was the campaign’s “main objective”. “The operation will continue as long as there is […]

Time for Iran to make tough decisions in nuclear talks: U.S.

Filed in Iran by on 28 March 2015

 Negotiations between six world powers and Iran over its nuclear program have been “tough and very serious” and the next few days will show whether Tehran is ready to make the necessary hard decisions, a senior U.S. official said on Friday. Iranian President Hassan Rouhani’s move to reach out to the leaders of the six powers on Thursday is “hopefully a sign that Iran is ready to make some of the tough decisions,” the senior State Department official added on condition of anonymity. The official said that other foreign ministers from the six-power group, which includes Britain, China, France, Germany, Russia as well as the United States, will arrive in the coming days to join the talks in Lausanne, Switzerland ahead of an end-March deadline for a political framework agreement. Tehran and the powers are struggling to hammer out a political framework accord by the […]

Iran and powers close in on 2-3 page nuclear deal, success uncertain

Filed in Iran by on 28 March 2015

Iran and major powers are close to agreeing a two- or three-page accord with specific numbers as the basis of a resolution of a 12-year standoff over Tehran’s nuclear ambitions, officials have told Reuters. As the French and German foreign ministers arrived in Switzerland on Saturday to join talks between U.S. Secretary of State John Kerry and Iranian Foreign Minister Mohammad Javad Zarif, Western and Iranian officials familiar with the negotiations cautioned that they could still fail. Kerry and Zarif have been in Lausanne for days to try to reach an outline agreement by a self-imposed deadline of March 31 between Iran on the one hand and the United States, Britain, France, Germany, Russia and China on the other. “The sides are very, very close to the final step and it could be signed or agreed and announced verbally,” a senior Iranian official familiar with […]

Iran Nuclear Talks Could Push Past Deadline

Filed in Iran by on 28 March 2015

With Iran nuclear talks nearing a critical deadline Tuesday, diplomats raised doubts that a meaningful deal could be reached in time even as the White House faces political hurdles in Washington to extend negotiations. Gaps between the two sides include how quickly Western nations would lift punitive sanctions against Iran, and what types of nuclear research Tehran would be allowed to continue, diplomats said. Negotiators also are grappling over access by international inspectors to Iran’s military sites, where evidence has suggested the possibility of past experiments on weapons technology. The differences between Iran and international powers are so wide that any agreement reached by Tuesday would likely be vague and wouldn’t necessarily be written down in a formal text, U.K. Foreign Secretary Philip Hammond warned Friday. Speaking […]

Houthi rebels clash with Saudi troops on Yemen’s northern border

Filed in Yemen by on 28 March 2015

Houthi fighters in Sana’a protest against Saudi air strikes Shia Houthi rebels clashed with Saudi military units on Yemen ’s northern border on Friday. The rebels vowed to intensify their campaign for control of the country after a second night of air strikes by a coalition of regional Sunni states led by Saudi Arabia. Houthi fighters also clashed with rival militias in the south of the country. As the fighting intensified, president Abd-Rabbu Hadi, who this week fled the southern port city of Aden in the face of the Houthi advance, travelled to Egypt to attend a summit of Arab leaders in Sharm el-Sheikh. The president vowed to call for an Arab ”Marshall Plan” to rebuild his country once the Houthis have been ousted. Tensions grew on Friday as Saudi and Egyptian warships deployed to the strategic Bab al-Mandab strait in an effort to stop Houthis taking control of […]

How the Yemen conflict risks new chaos in the Middle East

Filed in Yemen by on 28 March 2015

 The meltdown in Yemen is pushing the Middle East dangerously closer toward the wider regional conflagration many long have feared would arise from the chaos unleashed by the Arab Spring revolts. What began as a peaceful struggle to unseat a Tunisian dictatorfour years ago and then mutated into civil strife now risks spiraling into a full-blown war between regional rivals Saudi Arabia and Iran over a country that lies at the choke point of one of the world’s major oil supply routes. With negotiators chasing a Tuesday deadline for the framework of a deal to curb Iran’s nuclear program, it seems unlikely that Iran would immediately respond militarily to this week’s Saudi airstrikes in Yemen, analysts say. But the confrontation has […]

A partitioned Iraq would be a nightmare for Iran

Filed in Iraq by on 28 March 2015

Iran is not a sectarian actor, but Tehran still needs to prove it. Its involvement in the fight against the Islamic State in Iraq and the Levant (ISIL) is a good opportunity to do so. Iran’s ability to constrain and control Shia militias in the ongoing offensive in Tikrit, Iraq, will determine how Iraqis, regional powers and the rest of the international community view Iran and its policies. If the widely shared fear of a backlash against Sunnis in Iraq materializes, Iran will continue to be a player in the sectarian game despite itself. Iraq’s stability is an important concern for Iranians, who still remember the two countries’ devastating eight-year war in the 1980s. Iran sees ISIL as a grave threat in its backyard. After initial hesitation over the extent of the ISIL threat, Tehran has transformed the group’s menace into an opportunity. Tehran is providing the Iraqi army […]

Nigeria Votes in Sharply Contested Presidential Election

Filed in Nigeria by on 28 March 2015

The most sharply contested election in Nigeria ’s post-independence history wound down to a tense conclusion on Saturday amid fears that a polarized electorate would clash regardless of the outcome in a country split on religious, ethnic and sectional lines. There appeared to be little middle ground between partisans of the incumbent president, Goodluck Jonathan , a Christian from the south hated in the north for mismanaging a bloody Islamist insurgency at steep cost, and his challenger, Muhammadu Buhari, a former military ruler, a northerner and a belated democratic convert whose Muslim faith and authoritarian past are feared in the south. Voters on Saturday morning crowded around registration stations here in the north’s largest city, a packed metropolis of more than five million, as hitches in the process added to the tension. Election officials were more than two hours late in some places, and malfunctioning electronic […]

Advanced Drillships Become Burden For Owners As Business Dries Up

Filed in Oil Supply by on 28 March 2015

Not so long ago, advanced drillships costing more than half a billion dollars each and capable of operating in ever-deeper waters practically guaranteed big profits for oil-rig operators. Now, with oil prices down by half since June, many have become a burden on their owners as drilling activity slows. Drillship operators face a more brutal hit to margins than they did after the oil-price crash of 2008 because of the huge cost of maintaining the more than $10 billion worth of state-of-the-art vessels that have been idled at sea, analysts say. Noble Corp Plc, Ensco Plc and Transocean Ltd are among companies that have invested in advanced rigs which, unlike older jack-up rigs that attach to the ocean floor, rely on dynamic positioning systems using thrusters to keep them in position. And it’s these thrusters that are the problem. They need to be removed to […]

Bakken Rig Count Remains Flat

Filed in Shale Oil by on 28 March 2015

New Regulations For Fracking on Public Lands The Bakken-Three Forks rig count remained flat at 97 rigs running across our coverage area by midday Friday. In recent Bakken news, the Bureau of Land Management (BLM) finalized new rules on that will regulate hydraulic oil and gas fracturing on public and tribal lands. The ruling could potentially impact more than 90,000 oil and gas wells and set a precedent for future regulations. Read more: New Fracking Rules for Public Lands The U.S. rig count fell another 21 to 1048 rigs running as of today. A total of 233 rigs were targeting natural gas (down nine from the previous week) and 814 were targeting oil in the U.S. (41 less than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.) 97 rigs are running in the Williston Basin across MT, ND, and SD. 96 are […]

U.S. economic growth slows in fourth quarter; corporate profits fall

Filed in USA by on 28 March 2015

 U.S. economic growth cooled in the fourth quarter as previously reported and after-tax corporate profits took a hit from a strong dollar, which could undermine future business spending. Gross domestic product expanded at a 2.2 percent annual rate, the Commerce Department said on Friday in its third estimate of GDP. That was unrevised from the forecast the government published last month. Businesses throttled back on inventory and equipment investment, but robust consumer spending limited the slowdown in the pace of activity. The economy grew at a 5 percent rate in the third quarter. After-tax corporate profits declined at a 1.6 percent rate last quarter after increasing at a 4.7 percent pace in the third quarter. Corporate profits from outside the United States fell at an 8.8 percent rate, the steepest decline since the 2007-2009 recession. “Slower profit growth could mean slower investment in the coming months,” […]

Oil Rigs Decline by Smallest Number in 15 Weeks

Filed in USA by on 28 March 2015

U.S. oil rigs fell by the smallest number in 15 weeks, a potential sign that America’s oil-drilling crash may be tapering. Drillers idled 12 oil rigs (excluding gas rigs), dropping the number to 813, Baker Hughes reported on Friday.  The rig count has dropped 49 percent since October, an unprecedented retreat, as the drop in oil prices has made production less profitable. The median forecast from a Bloomberg survey of 10 #RigCountGuesses on Twitter was for a decline of 39. But production isn’t slowing yet, and new efficiencies in U.S. drilling and pumping may make raw numbers of rigs in the field misleading. The U.S. will pump 9.3 million barrels a day this year, the most since 1972, despite the fewest rigs in the field in almost four years, according to the Energy Information Administration. U.S. oil in storage is at a record, and production is at its highest level since […]

U.S. Oil Rig Count Falls Again

Filed in USA by on 28 March 2015

 The U.S. oil-rig count fell by 12 to 813 in the latest week, according to Baker Hughes Inc., marking the 16th-straight week of declines. The number of U.S. oil drilling rigs–a proxy for activity in the oil industry–has fallen sharply since prices headed south last year. There are now nearly 50% fewer rigs working since a peak of 1,609 in October. That hasn’t yet translated into a drop in actual output, even though it has squelched production capacity. Crude-oil futures held their declines after the data’s release and were recently off 3.2% to $49.79. According to Baker Hughes, gas rigs were down 9 to 233 this week. The U.S. offshore rig count is at 34, down 3 from last week and down 16 from the previous year. For all rigs, including natural gas, the week’s drop was 21 to 1048, and down 761 from 1809 at […]

BHI: US rig count decline smallest in 15 weeks

Filed in USA by on 28 March 2015

The US drilling rig count dropped just 21 units to settle at 1,048 rigs working during the week ended Mar. 27, representing the smallest decline in 15 weeks, according to data from Baker Hughes Inc. Oil rigs shed just 12 units, also its smallest decline in 15 weeks. The overall count has now fallen in 16 consecutive weeks, during which time it has plunged 872 units ( OGJ Online, Dec. 5, 2014 ). The total of 1,048 is the lowest count since the week ended Oct. 23, 2009, and 761 fewer units compared with this week a year ago. The slowed decline comes following analysis last week from Raymond James & Associates Inc. that said the decline’s pace has “far exceeded” RJA’s original expectations, which saw a March average of 1,485 units. The average for the first four weeks of […]

Coal’s percentage of US power generation drops in January: EIA

Filed in Coal by on 28 March 2015

Coal burn accounted for more US power generation in January than in December, but by percentage made up less of all power generated, Energy Information Administration data Friday showed. Coal’s share of the US electric power sector totaled 132,742 MWh in January, or 36.8% of all generation, down from the previous month as 19,467 MWh more power was generated. In December, coal burn totaled 124,715 MWh, which accounted for 40.7% of all generation. Natural gas made up 28% of generation in January and 29.4% of generation in December. Coal accounted for 46.5% of power generation in January 2014. Utility coal stockpiles grew from 151.4 million st in December to 157.8 million st in January. The last time stockpiles topped 156 million st was November 2013. Article continues below… Platts Coal Trader provides the latest prices for key benchmark coals, as well as: Daily pricing for tons and allowances for […]

Shell Moves Rigs To Alaska Ahead Of Possible Drilling Permit

Filed in Arctic by on 28 March 2015

Royal Dutch Shell is moving oil rigs to Alaska ahead of the possible resumption of controversial drilling activities as the oil major awaits the green light from U.S. authorities. The Anglo-Dutch oil major hopes to revive its Arctic drilling programme two years after the grounding of a rig in Alaska that led to a huge uproar from environmental groups. But even before getting the go-ahead from the U.S. interior secretary, Shell is moving the drilling rigs Noble Discoverer and Polar Pioneer to the area in anticipation of the short operations window in summer. The vessel are “heading to North America ahead of a potential 2015 drilling season,” a Shell spokeswoman told Reuters. “Any final decision to go […]

Statoil marks gas pipeline milestone

Filed in Norway by on 28 March 2015

Norwegian energy company Statoil said Friday it started the pioneering project of laying gas pipeline across the arctic waters of the Norwegian Sea. The company started the process of laying the 300-mile long Polarled pipeline from the Aasta Hansteen field in the Norwegian Sea across the Arctic Circle to a gas processing plant in the northwest of the country. Statoil said the project marks a regional milestone on several fronts . It’s the first large-diameter pipeline of its kind to be placed in waters of up to 4,150 feet deep and is the first pipeline to take gas across the Arctic Circle. “Polarled will have great and strategic impact on the future development of the region,” Jan Heiberg, acting director of […]

The Problem of the Human Population

Filed in Peak Oil by on 28 March 2015

However, there is concern for decades that in a finite world at some point should be the limits of the world’s population, and that may not be very smart to reach those limits. Although efforts to limit population growth in some countries like India or China, today these efforts have been abandoned or are abandoning were made in the second half of the twentieth century, mainly due to the pace of population growth is declining alone globally. As in all matters based on the laws of nature, we can use science to analyze the problem of the human population. The science that helps us in this case is ecology, which has a specific branch of human ecology . Anyone who thinks that we do not apply the laws of biology, is that it has lost touch with the reality of human nature. For very rational to presume to be, […]

Heinberg: AFTERBURN Society Beyond Fossil Fuels

Filed in Peak Oil by on 28 March 2015

Heinberg: AFTERBURN Society Beyond Fossil Fuels thumbnail The advent of fossil fuels changed the world profoundly (giving us everything from plastics and automobiles to global warming); the inevitable and rapidly approaching end of the oil-coal-and-gas era will likewise bring overwhelming transformation in its wake. My new book Afterburn explores that transformation—its opportunities and challenges—in sixteen essays that address subjects as varied as energy politics, consumerism, localism, the importance of libraries, and oil price volatility. Afterburn is a book of “greatest hits”—that is, popular essays that have been previously published—similar in that respect to an earlier book of mine, Peak Everything (2007). Like that previous collection, this one has been carefully selected and arranged, and features an all-new Introduction. Here are just a few of the highlights: “Ten Years After” reviews the debate about “peak oil” from the perspective of over a decade’s work in tracking petroleum forecasts, prices, and […]

Yemen fuels short-covering rally in oil

Filed in Prices by on 27 March 2015

LONDON (Reuters) – Air strikes by Saudi Arabia and its allies in Yemen have sparked a modest rise in oil prices of $3 per barrel, even though Yemen plays a marginal role in the global oil market. Yemen produces just 130,000 barrels per day, according to the U.S. Energy Information Administration (EIA), about 0.1 percent of global production and the same as Italy or Kansas. The country shares a long border with southwest Saudi Arabia but violence in that area poses no threat to the main Saudi oilfields, which are concentrated in the northeast of the kingdom. More significantly, Yemen forms one coastline of the Bab el-Mandeb Strait, which connects the Red Sea with the Gulf of Aden and the Arabian Sea. On average almost 4 million barrels of oil pass through the Bab el-Mandeb Strait every day en route from the main Gulf oilfields to refineries in the […]

Oil prices ease as market downplays supply threat from Yemen

Filed in Prices by on 27 March 2015

Oil prices fell over a percentage point on Friday as traders estimated that the threat of a disruption to world crude supplies from Saudi Arabia-led air strikes in Yemen was low. Goldman Sachs said in an overnight note that the strikes in Yemen would have little effect on oil supplies as the country was only a small crude exporter and tankers could avoid passing its waters to reach their ports of destination. Internationally traded Brent crude futures LCOc1 were trading at $58.44 a barrel at 0211 GMT, down 75 cents from their last settlement. U.S. crude CLc1 was down 88 cents at $50.55 a barrel. Prices soared as much as 6 percent the previous day after a Saudi-led coalition of Arab nations began strikes on Shi’ite Houthis and allied army units who have taken over much of Yemen and seek to oust President Abd-Rabbu Mansour Hadi. […]

Oil price surges as Saudis launch air strikes in Yemen

Filed in Prices by on 27 March 2015

The price of oil rose on Thursday as Saudi jets bombed Houthi rebels in the Yemeni capital, raising fears that the civil conflict in the Gulf state could escalate into a regional war. Saudi Arabia, backed by a 10-country Sunni coalition, launched the air strikes early on Thursday against targets in Houthi-controlled Sana’a, including the airport and a military air base. The Houthis responded by firing rockets across the northern border into Saudi territory. The Saudi attacks marked a big escalation of the Yemen crisis, in which the Shia Houthis, who are backed by Iran, are fighting to oust the country’s president, Abd Rabbuh Hadi, who is backed by Saudi Arabia and its Sunni allies. Oil prices rose as much as 6 per cent on Thursday in response to the strikes, though they later fell back […]

Oil Rallies After Saudi Campaign Escalates Crisis in Yemen

Filed in Prices by on 27 March 2015

Oil prices vaulted to their biggest gains in more than a month after Saudi Arabia and its allies launched a military campaign in neighboring Yemen, adding to concerns about the security of crude supplies in a region already fraught with tensions. The U.S. oil benchmark rose for the fifth straight session, surpassing $50 a barrel following the start of airstrikes to defend Yemen’s existing government against Iranian-backed rebels . While there were no immediate signs of any oil-supply disruption, the intervention by Saudi Arabia, the world’s No. 1 crude-oil exporter, stoked fears of a wider conflict among the biggest powers in the oil-rich region. Yemen itself produces a small amount of oil, but the country lies at the heart of some of the most important energy routes, with 7% of global oil maritime trade passing by its coast, according to U.S. Energy Information Administration estimates. Many traders and […]

Oil leaps 5 percent, most in a month, on air strikes in Yemen

Filed in Prices by on 27 March 2015

Oil jumped about 5 percent on Thursday, the biggest daily gain in a month, as air strikes in Yemen by Saudi Arabia and its Gulf Arab allies sparked fears that escalation of the Middle East battle could disrupt world crude supplies. The Saudi military operation against the Iran-backed Houthi rebels, who have driven Yemen’s president from the capital Sanaa, has not affected oil facilities of major Gulf producers. But fears the conflict could spread and disrupt Middle East shipments powered benchmark Brent oil to near $60 a barrel, in its biggest daily gain since Feb. 25. U.S. West Texas Intermediate (WTI) crude soared above $50, approaching 2015 highs. Some analysts said the chance of an all-out proxy war between the Saudis and Iran looked remote. They attributed some of Thursday’s rally in oil to short covering after steep losses in early March, and said gains […]

Natural Gas Prices Retreat After Larger-than-Expected Addition to Stockpiles

Filed in Prices by on 27 March 2015

Natural gas slipped to its lowest closing price in almost seven weeks after stockpiles grew for the first time this year and beyond market expectations. Natural gas for April delivery settled down 5.1 cents, or 1.9%, at $2.672 a million British thermal units on the New York Mercantile Exchange. It is down in five of the past six sessions and closed at its lowest point since Feb. 9. The more actively traded May contract fell 5.2 cents, or 1.9%, at $2.688/mmBtu. April options expired at the end of Thursday’s trading and the April futures contract expires at the end of Friday’s trading. The U.S. Energy Information Administration said storage levels grew by 12 billion cubic feet in the week ended March 20. That is 2 bcf more than the 10-bcf consensus average of 19 forecasters surveyed by The Wall Street Journal. The EIA […]

Fears That Iran Will ‘Flood’ the Oil Market Exaggerated

Filed in Iran by on 27 March 2015

 Oil industry experts say it is unlikely that Iran will flood the market with oil if sanctions are lifted as a result of Iranian nuclear talks, quelling fears that the talks would spook the markets. Negotiations between Iran and the U.S., UK, France, Russia, China and Germany – the so-called P5+1 group – reconvene this week, with the aim of curtailing Iran’s controversial nuclear programme, in exchange for the lifting of crippling international sanctions. Iran already has large amounts of oil in storage which have been extracted, say experts. Although it is a state secret exactly how much oil Iran has stored, analysts predict it could be as much as 37 million barrels. There have been reports that an injection of hundreds of thousands of barrels a day into the oil market, which is already struggling with oversupply, could […]

Iran’s Rouhani intervenes as deadline for nuclear deal approaches

Filed in Iran by on 27 March 2015

Iran’s president spoke with the leaders of France, Britain, China and Russia on Thursday in an apparent effort to break an impasse to a nuclear deal between Tehran and major world powers. He also raised the Saudi-led military operation against Iranian-backed Houthi fighters in Yemen, as did U.S. Secretary of State John Kerry ahead of nuclear negotiations in Switzerland with Tehran’s Foreign Minister Mohammad Javad Zarif. The United States is pushing for a nuclear deal between Iran and major powers before a March 31 deadline, and officials close to the talks said some kind of preliminary agreement was possible. However, a senior British diplomat acknowledged: “There are still important issues where no agreement has so far been possible. “Our task, therefore, for the next few days is to see if we can bridge the gaps and arrive at a political framework which could then be […]

KRG solidifies hold on Ain Zalah

Filed in Iraq by on 27 March 2015

 The autonomous Kurdistan Regional Government (KRG) appears to be appropriating another oil field formerly controlled by Iraq’s federal government – part of a controversial drive to expand control over the country’s disputed territories.The KRG has been lifting crude from the Ain Zalah field, in northwestern Ninewa province, at a rate of roughly 2,000 barrels per day (bpd), according to a worker at the field.”They are sending between 100 to 200 trucks to Kurdistan,” the worker said. “T…

U.S. Airstrikes on ISIS in Tikrit Prompt Boycott by Shiite Fighters

Filed in Iraq by on 27 March 2015

By Day 2 of the American airstrike campaign against militants holed up in Tikrit, the mission appeared beleaguered on several fronts on Thursday: Thousands of Shiite militiamen boycotted the fight, others threatened to attack any Americans they found, and Iraqi officials said nine of their fighters had been accidentally killed in an airstrike. In Washington, American military leaders insisted that things were going according to plan. They said that they were stepping into the Tikrit fight only after the Iranian- and militia-led advance on the city had stalled after three weeks, and that they welcomed working solely with Iraqi government forces. Gen. Lloyd Austin, the head of the United States Central Command, told a Senate hearing on Thursday […]

Yemen Conflict Devolves Into Proxy War

Filed in Yemen by on 27 March 2015

The conflict in Yemen is quickly devolving into a wider regional conflagration, pitting Shiite Iran and an allied militant group against Saudi Arabia and other Sunni Arab states that came together to launch airstrikes on those militants. The coordinated Arab attacks led by Saudi Arabia began early Thursday morning and targeted the Shiite-linked Houthi militant group in Yemen. They followed weeks of talks on forging a joint military force to combat what some nations see as regional threats from Iran coupled with a U.S. reluctance to intervene. Saudi Arabia, Shiite Iran’s main rival for power in the Middle East, conducted the first round of strikes against the Houthis. In the early hours of Friday, residents of the capital San’a reported an intense barrage of explosions as a second round […]

Yemen war clouds raise dangers for top oil shipping route

Filed in Yemen by on 27 March 2015

Conflict in Yemen risks spilling out into the busy sea lanes that pass it and potentially disrupt the narrow Bab el-Mandeb passage through which nearly 4 million barrels of oil are shipped daily to Europe, the United States and Asia. Oil prices rose as much as 6 percent on Thursday after neighboring Saudi Arabia and its allies launched air strikes on Yemen that targeted Iran-backed Houthi rebels fighting to oust Yemen’s president. The development is a gamble by the world’s top oil exporter to check Iranian influence in its backyard. “The collapse of Yemen as a political reality and the power of the Houthis will enable Iran to expand its presence on both sides of the Bab el-Mandeb, in the Gulf of Aden and in the Red Sea. Already discrete numbers of Iranian naval vessels regularly sail these waters,” J. Peter Pham of U.S. think tank […]

Nigeria’s External Reserves Fall Below U.S.$30 Billion

Filed in Nigeria by on 27 March 2015

The value of Nigeria’s external reserves, which has been on the downswing in the past few weeks, fell below the $30 billion mark to $29.865 billion as at March 25, 2015, according to latest Central Bank of Nigeria’s (CBN’s) figures. THISDAY’s findings show that the current level of the foreign reserves, which is derived mainly from the proceeds of crude oil earnings, has fallen by 13.4 per cent or $4.628 billion this year, compared with the $34.493 billion it stood at the beginning of the year. This has been attributed to the significant reduction in forex inflow into the country occasioned by the sustained low crude oil prices. Oil prices however rallied for a second straight day on Thursday after Saudi Arabia and its Gulf Arab allies began air strikes in Yemen, sparking fears of a bigger Middle East battle that could disrupt world crude supplies. Brent crude was […]

U.S.: Schlumberger ‘willfully’ violated sanctions

Filed in Iran, USA by on 27 March 2015

For six years, a division of oil services company Schlumberger “willfully” violated U.S. sanctions against Iran and Sudan, the Justice Department said. “Over a period of years [ending in 2010], Schlumberger Oilfield Holdings Ltd. conducted business with Iran and Sudan from the United States and took steps to disguise those business dealings, thereby willfully violating the U.S. economic sanctions against those regimes,” U.S. Assistant Attorney General Carlin said in a statement. The Justice Department said the oil services company agreed to enter a guilty plea and pay a $232 million penalty for conspiring to violate sanctions against trade with Iran and Sudan. Under the terms of the agreement, Schlumberger agreed to halt all activity in those countries for a three-year period. […]

Halliburton Closing Minot Facility

Filed in Shale Oil by on 27 March 2015

Beginning April 1st, Halliburton will no longer have a presence in Minot, North Dakota. A spokesperson confirmed Tuesday that the company will suspend operations and close the facility, transferring employees to their Williston and Dickinson locations. This is the latest in a string of announcements from Halliburton about their efforts to streamline operations in the face of the current crude pricing downturn. Earlier this year the company reported worldwide layoffs of 6,500 people followed by an announcement that they would close their facility in Regina, Saskatchewan in March. Related: Energy Giants Announce Layoffs Spokesperson Susie McMichae said that “The company continue to make adjustments to its workforce based on current business conditions. We value every employee we have, but unfortunately we are faced with the difficult reality that reductions are necessary to worth through this challenging market environment,” said McMichael.

PetroChina to Slash Spending as Oil Prices Hit Profits

Filed in China by on 27 March 2015

PetroChina Co. has become the latest major global oil company to slash its spending plans for the coming year, after a global drop in oil prices led to a 17% fall in its 2014 net profit. The company is pledging to cut capital spending 8.8%, to 266 billion yuan this year, its lowest level since 2008. The planned spending cut by PetroChina, the nation’s biggest oil-and-gas producer by volume, follows similarly announced cuts by its rivals Sinopec Corp. and Cnooc Ltd. “In 2015, the global economy is expected to continue to recover at a low speed, subject to some unstableness and uncertainties,” PetroChina said in its Thursday filing with the Hong Kong Stock Exchange. The company has been a […]

Oil Producers Sound Retreat From China

Filed in China by on 27 March 2015

 PetroChina said 2014 net profit dropped 17% amid low oil prices, and pledged to slash spending on exploration and production and other areas this year. Above, a PetroChina oil factory in Dalian, China. Photo: Reuters BEIJING—Global oil companies are unwinding some big bets they made on China—and that is bad news for the Chinese companies, which need their know-how. Falling oil prices have forced oil bosses to slash planned investments that now look less likely to provide good returns. Projects in China, often expensive and geologically risky, are high on the list of those to be cut. Royal Dutch Shell PLC emerged as one of the industry’s biggest China proponents in recent years, pledging billions of dollars to hunt for shale gas while building up businesses producing and selling oil products. The company is now scaling back investment in China shale exploration after several years of costly challenges. […]

Mysterious Gas Clouds China Energy Giants

Filed in China by on 27 March 2015

When it comes to oil, China’s state energy behemoths have become more predictable, market-driven entities. But for increasingly important natural gas, investors still must turn to Beijing for clarity. PetroChina , the country’s largest producer of oil and gas, emphasized frugality late Thursday when it reported 2014 results. Like 2013, it slashed capital expenditures, with management targeting another 9% reduction in 2015. PetroChina even funded its big investments and dividends entirely out of operating cash flows, which wasn’t the case in 2013. China Petroleum & Chemical , the nation’s number two energy producer that’s better known as Sinopec, cut capital spending by 16% in 2014. It’s encouraging that China’s state-run companies are learning to live within their means, like Western majors. Anticorruption probes imposed discipline , as did oil’s price collapse. Investors should […]

China’s crude oil output edges up

Filed in China by on 27 March 2015

China’s crude oil output in the first two months rose slightly year on year, according to the country’s top economic planner on Friday. The National Development and Reform Commission (NDRC) said that crude oil production stood at 34.21 million tonnes in January and February, up 1.2 percent from a year earlier. The country refined 76.05 million tonnes of crude oil during the first two months, up 1.5 percent year on year, while output of refined products rose by 3 percent to 47.85 million tonnes, the NDRC said. Apparent consumption of refined oil products rose 8 percent from a year earlier to 42.93 million tonnes. In the same period, natural gas output rose 7.7 percent to 23.5 billion cubic meters, while imports climbed 15.5 percent to 10.7 billion cubic meters. Apparent consumption of natural gas rose 6.2 percent year on year to 34.1 billion cubic […]

Chevron to divest 50% stake in Caltex Australia

Filed in Australia by on 27 March 2015

Chevron’s executive vice-president of Downstream and Chemicals Michael Wirth said in a statement that the divestment is aligned with its previously announced asset sales commitment and is part of its desire to regularly review its portfolio and generate cash to support long term priorities. “Chevron will continue to ensure a reliable, high-quality supply of product is available to Caltex to supply to its retail and reseller franchise network. Chevron is also committed to seeking long-term relationship opportunities with Caltex.” Caltex has a 109,000 b/d refinery at Lytton in Brisbane, which operated at 88.6% utilization last year. The company shut its 135,000 b/d refinery at Kurnell in Sydney in October 2014. The facility is currently being converted into an import terminal. The fall in crude prices resulted in a dramatic drop in Caltex’s profit to just A$20 million ($15.7 million) last year, down from A$530 million in 2013. Meanwhile, Chevron […]

Canada’s New Brunswick Province Bans Fracking, Plans Study

Filed in Canada, Shale Oil by on 27 March 2015

Lawmakers in New Brunswick voted on Thursday to prohibit fracking in the eastern Canadian province, committing to study the controversial method of extracting oil and gas for one year before reconsidering the ban in 2016. The province’s Liberal-led government said it will require five conditions be met before the moratorium is lifted. These include beefed-up environmental and health regulations, a plan for waste water disposal, consultations with aboriginal groups, a royalty structure, and the establishment of a “social license,” which is the approval by local communities and stakeholders. “It is responsible and prudent to do our due diligence and get more information regarding hydraulic fracturing,” said Energy and Mines Minister Donald Arseneault. The province is the latest of several in eastern Canada, including Quebec, Labrador and Newfoundland, and Nova Scotia, to stop companies from fracking while they study its impact. New Brunswick is […]

Oil Council: Shale Won’t Last, Arctic Drilling Needed Now

Filed in Arctic, Oil Supply by on 27 March 2015

The U.S. should immediately begin a push to exploit its enormous trove of oil in the Arctic waters off of Alaska, or risk a renewed reliance on imported oil in the future, an Energy Department advisory council says in a study to be released Friday. The U.S. has drastically cut imports and transformed itself into the world’s biggest producer of oil and natural gas by tapping huge reserves in shale rock formations. But the government predicts that the shale boom won’t last much beyond the next decade. In order for the U.S. to keep domestic production high and imports low, oil companies should start probing the Artic now because it takes 10 to 30 years of preparation and drilling to bring oil to market, according to a draft of the study’s executive summary obtained by the Associated Press. “To remain globally competitive and to be positioned […]

Some Energy Companies Find the Going Tough

Filed in Shale Oil by on 27 March 2015

The oil slump has created opportunities for lawyers and bankers. Photo: Daniel Acker/Bloomberg News The ranks of financially stressed companies have swelled to a 4½-year high as the sharp drop in oil prices batters energy companies. The number of companies with the worst below-investment-grade debt ratings rose to 184 in February, the highest count since November 2010, and remained at that level in March, according to Moody’s Investors Service. That is a 16% increase over March 2014. The 25 oil-and-gas and oil-services companies listed accounted for 13.6% of the total this month, their highest share ever. Moody’s tally of stressed companies includes only U.S. nonfinancial firms rated B3 with a negative outlook for future ratings changes or lower. The B3 rating is six notches into junk territory. “If this trend increases, we might see more defaults in the energy sector,” said Julia […]

California Just Had a Stunning Increase in Solar

Filed in Solar by on 27 March 2015

California is now the first U.S. state to get 5 percent of its annual utility-scale electricity from the sun. But that’s really understating what just happened.  The chart above, released this week by the U.S. Energy Information Administration, shows that in just one year, big solar jumped from 1.9 percent to 5 percent of the state’s total power generation. California isn’t just producing the most utility-scale solar electricity of any state; it’s producing more than all the other states combined .  And that’s only what the major electricity producers are generating—it doesn’t include rooftop solar, in which California is also leading the nation. In small-scale solar, capacity for another 2.3 gigawatts has been installed, according to the California Public Utilities Commission.  Renewable energy, including hydro power and rooftop solar, now constitutes about a third of California’s electricity, a remarkable feat accomplished through renewable requirements for utilities and incentives for homeowners.  But even that understates California’s […]

Royal Dutch Shell to Cut 250 North Sea Jobs

Filed in United Kingdom by on 27 March 2015

Royal Dutch Shell PLC said Thursday that it would eliminate at least 250 jobs in its U.K North Sea operations this year, the latest workforce cut for big energy companies trying to reduce spending as crude trades for about half its 2014 peak. The job cuts come on top of the 250 positions Shell eliminated last summer from its U.K. operations and represent another blow to a North Sea oil industry that has seen its often high-cost projects upended by an oil-price collapse. Shell, which has about 94,000 employees world-wide, had been trying to cut costs even before the oil price began falling, after being criticized by investors for years of heavy spending on big projects. The company said the cuts “are part of a range of initiatives Shell has been pursuing to […]

Russia squeezed by sanctions, European leader says

Filed in Russia by on 27 March 2015

 Along with the low price of oil, sanctions imposed on Russia in response to crises in Ukraine have struck a major blow to its economy, a European leader said. The European Union in March 2014 imposed sanctions against Russia after it annexed the Crimean Peninsula from Ukraine. Violence erupted in Ukraine the previous November after the former Soviet republic started a slow pivot toward the EU. Sanctions imposed in July cut into the Russian energy sector, which accounted for more than half of the government’s revenue. Gabrielius Landsbergis, a Lithuanian member of the European Parliament steering aid to Ukraine, said Thursday the sanctions have created huge problems for the Russian economy. “It’s difficult to measure the exact results, but what we […]

The Problem of the Human Population

Filed in Peak Oil by on 27 March 2015

This is a guest post by Javier Javier holds a PhD in Biochemistry and Molecular Biology and has been a scientist for 30 years in molecular genetics and neurobiology. He wrote a blog on macroeconomy and investments from a cyclic point of view for over two years and currently writes a blog in Spanish about the economic crisis, energy crisis and climate change at  . Javier goes by the name of Knownuthing on his blog. Opinions expressed in this post are those of Javier and not necessarily those of the blog owner Ron Patterson. This post was translated from the Spanish by computer and may therefore contain some grammatical errors. The Problem of the Human Population  The question of whether or not overpopulation in the world is clearly debatable. For starters there is no agreement on what should be the world’s population and is also clear that currently the […]