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The Purposely Confusing World of Energy Politics

Life often presents us with paradoxes, but seldom so blatant or consequential as the following. Read this sentence slowly: Today it is especially difficult for most people to understand our perilous global energy situation, precisely because it has never been more important to do so. Got that? No? Okay, let me explain. I must begin by briefly retracing developments in a seemingly unrelated field—climate science. But a funny thing happened along the way. Clearly, if the climate is changing rapidly and dramatically as a result of human action, and if climate change (of the scale and speed that’s anticipated) is likely to undermine ecosystems and economies, then it stands to reason that humans should stop emitting so much CO2. In practical effect, this would mean dramatically reducing our burning of fossil fuels—the main drivers of economic growth since the beginning of the Industrial Revolution. From a policy standpoint, climate […]

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Tech Talk – The BP Energy Outlook 2035

BP begins its new forecast for the energy future with the statement: We project that by 2035 the US will be energy self-sufficient while maintaining its position as the world’s top liquids and natural gas producer. This illustrates the optimism which BP are projecting in their image of future production. But it carries with it a lot of inherent assumptions, some of which are relatively easy to identify in the summary graphic presentation that accompanied the initial presentation of the new report. Perhaps the most illustrative of their optimism is this plot, which shows the increasingly decoupled changes in energy supply relative to projected increases in GDP. Figure 1. The reducing dependence on Energy growth as a control on GDP. (All figures are from the new BP Energy Outlook for 2035 ) Each year there […]

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The Golden Age of Gas… Possibly: An Interview With The IEA

Page added on February 11, 2014 The potential for a golden age of gas comes along with a big “if” regarding environmental and social impact. The International Energy Agency (IEA)—the “global energy authority”–believes that this age of gas can be golden, and that unconventional gas can be produced in an environmentally acceptable way. In an exclusive interview with Oilprice.com, IEA Executive Director Maria van der Hoeven , discusses: The potential for a golden age of gas What will the “age” means for renewables What it means for humanity The challenges of renewable investment and technology How the US shale boom is reshaping the global economy Nuclear’s contribution to energy security What is holding back Europe’s energy markets The next big shale venues beyond 2020 The reality behind “fire ice” Condensate and the crude export ban The most critical energy issue facing the world today Interview by. James Stafford of […]

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Investors Monitoring U.S. Oil Inventory Levels

Crude-oil futures are mostly flat in Asian trading hours Tuesday as investors monitor the status of U.S. oil inventory levels, global demand-supply balances and economic growth indicators. On the New York Mercantile Exchange, light, sweet crude futures for delivery in March traded at $100.05 a barrel at 0554 GMT, down $0.01 in the Globex electronic session. March Brent crude on London’s ICE Futures exchange rose $0.05 to $108.68 a barrel. Nymex West Texas Intermediate crude settled at its highest level this year in overnight floor trade after rising for five straight sessions. U.S. oil markets are supported by strong heating oil demand this winter and expectations that oil inventories at the oil delivery hub of Cushing, Okla. fell again last week after the easing of pipeline bottlenecks. The weekly oil inventory data from the American Petroleum Institute, a trade body, is due later in the trading day. "While declining […]

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WTI Trades Near Six-Week High as U.S. Fuel Supplies Seen Falling

West Texas Intermediate crude traded near a six-week high amid speculation that U.S. distillate stockpiles declined as cold weather boosted demand for heating fuels in the world’s biggest oil consumer. Futures were little changed in New York after advancing for a fifth day yesterday. Distillate fuels , a category that includes heating oil and diesel, probably shrank by 2.13 million barrels last week, according to a Bloomberg News survey before an Energy Information Administration report tomorrow. A winter storm may spread snow and sleet across the nation’s south, the U.S. National Weather Service said. WTI for March delivery was at $99.94 a barrel, down 12 cents, in electronic trading on the New York Mercantile Exchange at 11:43 a.m. Sydney time. The contract rose 18 cents to $100.06 yesterday, the highest settlement since Dec. 27. The volume of all futures traded was about 78 percent below the 100-day average. Prices […]

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Natural-Gas Futures Fall for Fourth Straight Session

-Natural-gas futures fell for a fourth straight session on expectations that the weather would turn milder later this month, reducing the need for gas-fueled heating. Signs of diminishing demand from power generators as they switch to less-expensive coal also knocked natural-gas futures lower, an analyst said. It is a turnaround for the natural-gas market, which had benefited from rising demand for the fuel amid a brutally cold winter. Natural gas for March delivery fell 19.6 cents, or 4.1%, to $4.579 a million British thermal units on the New York Mercantile Exchange, its lowest settlement since Jan. 21. Futures are down nearly 15% since Feb. 4. Kyle Cooper, managing director of research at IAF Advisors, attributed the slide to moderating temperature forecasts and tepid demand from power generators. […]

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Iran’s Islamic republic at 35: Poised for change and a less isolated existence

Thirty-five years after the founding of its Islamic republic, Iran is in the midst of a transformative period, with signs that its relations with the United States are warming in a way that was hardly imaginable when Ayatollah Ruhollah Khomeini returned here from exile in February 1979. On Tuesday, the Islamic state is expected to mark its anniversary, as it does every year, with massive public rallies and speeches from top officials. But the speech by President Hassan Rouhani is likely to carry a starkly different tone from the defiant addresses delivered by Mahmoud Ahmadinejad during his eight years as president. “Regardless of […]

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Suicide Bomb Trainer in Iraq Accidentally Blows Up His Class

If there were such a thing, it would probably be rule No. 1 in the teaching manual for instructors of aspiring suicide bombers: Don’t give lessons with live explosives. In what represented a cautionary tale for terrorist teachers, and a cause of dark humor for ordinary Iraqis, a commander at a secluded terrorist training camp north of Baghdad unwittingly used a belt packed with explosives while conducting a demonstration early Monday for a group of militants, killing himself and 21 other members of the Islamic State of Iraq and Syria, army and police officials said. Iraqi citizens have long been accustomed to daily attacks on public markets, mosques, funerals and even children’s soccer games, so they saw the story of the fumbling militants as a dark — and delicious — kind of poetic justice, especially coming amid a protracted surge of violence led by the terrorist group, […]

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Officials: Gunmen kill 15 troops in northern Iraq

Iraqi officials say militants have killed 15 troops in an attack overnight on military barracks in a remote area in the country’s north. Police officers said on Tuesday that an unknown number of gunmen attacked the barracks in Ayn al-Jahish village, outside the northern city of Mosul late the previous night. A medical official says eight of the soldiers were beheaded while the others were killed by gunfire. All officials spoke on condition of anonymity because they are not authorized to talk to media. Mosul is a former insurgent stronghold, located about 360 kilometers (225 miles) northwest of Baghdad. The brazen attack comes amid a surge in violence to levels unseen in Iraq since 2008. It’s been a most serious challenge to the Shiite-led government’s efforts to achieve stability. © 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or […]

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Syrian Regime Loyalists Seethe Over U.N. Aid Operation for Rebel Area

HOMS, Syria—Regime loyalists here voiced fury over a United Nations humanitarian relief mission for a rebel-held enclave in their city, accusing the organization of bias against minorities that support President Bashar al-Assad. The U.N. said Monday that it was extending the relief mission for the old quarter of Homs for three more days. It has already evacuated more than 1,000 people and delivered desperately needed food while its convoys came under mortar and sniper fire on their way into the besieged enclave. At least 11 people have been killed in violence around the operation since it began on Friday, the U.N. said. Members of the Mr. Assad’s Alawite sect, an offshoot of Shiite Islam and a minority in Syria that dominates the regime, accused the U.N. of being far more concerned about taking in food and medicine for rebels and civilians than determining the whereabouts of some 740 missing […]

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Egypt: Militants blow up gas pipeline in Sinai

Egyptian security officials say suspected al-Qaida-inspired militants have blown up a natural gas pipeline in the restive Sinai Peninsula. The officials say the explosion took place early Tuesday in a desert area south of el-Arish, the provincial capital of North Sinai. The pipeline carries natural gas to Jordan and feeds heavy industry factories in central Sinai. The officials say pipeline technicians were forced to shut the flow of gas in order to get the fire under control. They spoke on condition of anonymity because they are not authorized to talk to media. There have been scores of attacks on the pipeline since the 2011 uprising that toppled autocrat Hosni Mubarak and the security vacuum that ensued. A Sinai-based militant group, Ansar Beit al-Maqdis, has claimed responsibility for several such bombings. © 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, […]

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Diabetes Epidemic Hits Persian Gulf Region

Mohammad Najih is a typical diabetic in the Middle East: diagnosed at 24, he spent six years ignoring the disease until he was forced to begin injecting insulin. Now aged 32, the Emirati from the desert state of Dubai has vowed to help other Arabs avoid the same mistake. Last year, the Type 2 diabetic set up an anonymous Twitter account where diabetics can ask questions about the disease and talk to other sufferers. Having gained more than 2,000 followers in a few months on @diabetesUAE, he now plans to launch a self-help group to meet in coffee shops and eventually go into schools and universities to educate youngsters. "In the U.S., people who have diabetes would wear a band that shows that they’re diabetic but if you do it here, [people] will see that this is a stigma," says Mr. Najih, who believes this stigma is worsening an […]

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China's power capacity up 94 mln kw in 2013

China’s installed power capacity increased by 94 million kilowatts (kw) in 2013, the National Energy Administration (NEA) said on Monday. Thermal power accounted for the bulk of the capacity growth, topping 36.5 million kw, followed by 29.93 million kw from hydropower, 14.06 million kw from on-grid wind power, 11.3 million kw from on-grid solar power and 2.21 million kw from nuclear power. The country’s total installed power capacity topped 1.25 billion kw at the end of 2013, up 9.3 percent year on year. Thermal power accounted for the bulk of the total capacity at the end of 2013, reaching more than 860 million kw, up 5.7 percent year on year. On-grid solar energy capacity increased by 340 percent from a year earlier. China’s electricity consumption, a key indicator of economic activity, rose 7.5 percent year on year to 5.32 trillion kilowatt hours in 2013, […]

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China’s power capacity up 94 mln kw in 2013

China’s installed power capacity increased by 94 million kilowatts (kw) in 2013, the National Energy Administration (NEA) said on Monday. Thermal power accounted for the bulk of the capacity growth, topping 36.5 million kw, followed by 29.93 million kw from hydropower, 14.06 million kw from on-grid wind power, 11.3 million kw from on-grid solar power and 2.21 million kw from nuclear power. The country’s total installed power capacity topped 1.25 billion kw at the end of 2013, up 9.3 percent year on year. Thermal power accounted for the bulk of the total capacity at the end of 2013, reaching more than 860 million kw, up 5.7 percent year on year. On-grid solar energy capacity increased by 340 percent from a year earlier. China’s electricity consumption, a key indicator of economic activity, rose 7.5 percent year on year to 5.32 trillion kilowatt hours in 2013, […]

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Tight Propane Supply Reaches Crisis

Federal and state officials are pushing emergency measures to get propane to people who need the gas to heat their homes in the Midwest and other regions of the country beset by persistent frigid temperatures. The measures, which include extending working hours for truckers and ordering a pipeline company to prioritize shipments to areas with tight supplies, are meant to alleviate a propane crunch that has sent prices for the fuel to record highs in some parts of the country. "The propane shortage has been a crisis for thousands of families and farmers in Minnesota and across the region," Sen. Al Franken, who represents the North Star State, said in a statement. He has been asking various federal agencies to help route more propane to places in need. Governors in affected states are trying to increase propane deliveries and make funds available for residents to pay higher heating bills. […]

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Tokyo election win a victory for nuclear power?

The victory of Yoichi Masuzoe in Tokyo’s gubernatorial election Sunday could be a boost for Japan’s return to nuclear power, though the anti-nuclear camp still urges against it. Masuzoe wants less dependence on nuclear power in the long run, while his main rivals, former Prime Minister Morihiro Hosokawa and Kenji Utsunomiya, a former head of the Japan Federation of Bar Associations, favored an immediate end to nuclear power. Utsunomiya won about 983,200 votes and Hosokawa about 956,000 votes against Masuzoe’s approximately 2,112,000 votes, the Japan Times reported Monday. All of Japan’s 48 operable nuclear reactors remain offline, pending safety checks after the March 2011 Fukushima nuclear power plant disaster triggered by a massive earthquake and tsunami. Prior to the Fukushima crisis, nuclear power provided nearly 30 percent of Japan’s electricity Japanese Prime Minister Shinzo Abe , who has called for restarting Japan’s idled nuclear […]

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Exclusive: Duo tracks double-dipping in U.S. oil firms' toxic tank cleanup

A pioneer in cleaning up toxic messes, Thomas Schruben long suspected major oil companies of being paid twice for dealing with leaks from underground fuel storage tanks – once from government funds and again, secretly, from insurance companies. Schruben, a detail-oriented Maryland environmental engineer who helped draft government pollution rules going back 30 years, looked for a lawyer to help ferret out what he believed could in some cases be fraud. He found a partner in Dennis Pantazis, a buoyant, mustachioed son of Greek immigrants in Alabama known for bringing environmental and civil rights cases. "Together we started unraveling the mystery," Schruben said. The U.S. Environmental Protection Agency, Schruben’s former employer, has called the rusted, leaky steel tanks the single largest threat to groundwater in the United States. Often built for gas stations during the 1950s and ’60s highway construction boom, the tanks corroded over […]

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Exclusive: Duo tracks double-dipping in U.S. oil firms’ toxic tank cleanup

A pioneer in cleaning up toxic messes, Thomas Schruben long suspected major oil companies of being paid twice for dealing with leaks from underground fuel storage tanks – once from government funds and again, secretly, from insurance companies. Schruben, a detail-oriented Maryland environmental engineer who helped draft government pollution rules going back 30 years, looked for a lawyer to help ferret out what he believed could in some cases be fraud. He found a partner in Dennis Pantazis, a buoyant, mustachioed son of Greek immigrants in Alabama known for bringing environmental and civil rights cases. "Together we started unraveling the mystery," Schruben said. The U.S. Environmental Protection Agency, Schruben’s former employer, has called the rusted, leaky steel tanks the single largest threat to groundwater in the United States. Often built for gas stations during the 1950s and ’60s highway construction boom, the tanks corroded over […]

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U.S. Utilities Tighten Security After 2013 Attack

PG&E Corp. says it will build opaque fences around critical transmission substations, including at the Metcalf substation that was heavily damaged by gunmen firing from outside a chain-link fence last year. The San Francisco-based utility, which serves Northern California, is also staffing important locations overnight. The company had eliminated some nighttime shifts after it built a power-system control center in Vacaville, Calif., in 2009. PG&E and other utilities announced new safety measures after The Wall Street Journal reported last week that the attack on the Metcalf transmission substation raised concerns about the vulnerability of the electric grid to physical sabotage. Jon Wellinghoff, the former chairman of the Federal Energy Regulatory Commission, called the incident an act of terrorism. The attack on the Metcalf substation, south of San Jose, Calif., began after 1 a.m. April 16 by gunmen who took out 17 of the 20 giant transformers that funnel power […]

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Relief at the pump far away, AAA says

AAA spokesman Michael Green said Monday gasoline prices may reach a seasonal peak in March or early April because of regular refinery maintenance. The national average price for a gallon of regular unleaded gasoline during last year’s winter maintenance season peaked Feb. 27 at $3.79 per gallon. AAA reported a national average price Monday of $3.29, two cents higher than last week but 56 cents less than the same time last year. Green said prices tend to increase as winter ends because refineries shut down for upgrades and regular maintenance. This in turn leads to a tight gasoline market and higher prices for consumers. "It looks like the peak maintenance period this year will be in March, so it is likely that drivers will pay the highest prices sometime in March or early April," he said in response to email questions. Green said some […]

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Drillers Eye Gains From Oil-State Senators Heading Panel

They’re senior senators from two of the nation’s top oil-producing states, longtime friends who are about to begin a partnership that has environmentalists uneasy and industry lobbyists counting on a shift in energy policy. Democratic Senator Mary Landrieu of Louisiana will take the gavel at the Senate Energy and Natural Resources Committee as early as today, joining Senator Lisa Murkowski of Alaska who is already the panel’s top Republican. The combination could boost industry priorities like expanded exports of oil sought by producers such as Exxon Mobil Corp. , and of natural gas sought by Dominion Resources Inc. and Cheniere Energy Inc. , as well as TransCanada Corp.’s proposed Keystone XL pipeline. “Over time, these two are going to be a pretty powerful force for energy producers and for pipelines,” said Michael McKenna , a Midlothian, Virginia, lobbyist whose clients include Treaty Energy Corp. , a Houston-based oil and […]

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New Yorkers Pay Record Prices to Heat Homes in Winter Freeze

New Yorkers are paying record prices for heating this month as cold weather and natural gas restrictions boost demand for oil, draining supplies already at the lowest in more than two decades on the U.S. East Coast. Residential heating oil in the state of New York surged to $4.482 a gallon on Feb. 3, the highest in data going back to 1990, according to the U.S. Energy Information Administration. Prices have risen 25.4 cents this year. Across the U.S., the fuel averaged $4.241 a gallon, also a record. “These prices are absolutely nuts because there’s just no supply,” said Bob Castoro, 60-year-old owner of New York-based Dyno Fuel Oil , who raised prices more than 30 cents a gallon in less than three weeks. “I don’t know how my customers are going to pay their bills. It’s a choice between eating or putting heating oil in the tank to […]

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Harper Sees Keystone Approval, With or Without Obama

As far as Stephen Harper is concerned, history and economics carry far more weight in Canada-U.S. relations than whoever happens to occupy the White House at a given moment. That’s why Canada ’s prime minister remains relatively unperturbed about the drawn-out Keystone XL pipeline review, maintaining its approval is “inevitable.” In a wide-ranging interview on energy policy in his Ottawa office last month, Harper described how historical and economic forces and broad-based support for resource development determine whether projects like Keystone get built, rather than short-term political calculations. If Barack Obama doesn’t approve the pipeline, another president will. “It is, in my judgment, a necessary and inevitable victory,” Harper said in a Jan. 16 interview as he awaited a State Department environmental assessment of the project. “I absolutely believe that. I can’t see how it will be otherwise.” Moving Crude Through the […]

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Total Plans More Drilling After Oil Exploration Failures

Total SA (FP) began life as Cie Francaise des Petroles, or CFP, almost a century ago. Thirty years since changing its name, the French oil giant is fighting to prevent its “Can’t Find Petroleum” moniker from coming back. Three years and $7.3 billion into an exploration drive, Chief Executive Officer Christophe de Margerie still finds large discoveries elusive. Better drilling results — at least 12 “high-impact” wells are planned this year — are critical to bolster output and profit. Total will say tomorrow adjusted net income fell 11 percent last year to 11.1 billion euros ($15.1 billion), according to the average estimate of 22 analysts surveyed by Bloomberg. “Total has been quite disappointed with its exploration,” said Theepan Jothilingam, an oil industry analyst at Nomura Holdings Inc. “There will be a reassessment of returns on capital that has been spent on the effort. Questions will be raised in 12 […]

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U.K. Towns West of London Face Severe Thames River Flood

Waterlogged towns on the River Thames west of London face severe flooding as U.K. authorities struggle to deal with the wettest weather since 1766. The Environment Agency has in place 16 severe flood warnings, including 14 along England ’s most famous waterway. Towns in London’s commuter belt including Chertsey, Egham and Datchet are affected. Two warnings remain in Somerset, southwest England, where some roads have been cut off since December. After two months of record-breaking rainfall, there’s little respite for southern England, with the Met Office predicting rain every day through Feb. 14. A succession of storms and tidal surges have buffeted Britain since early December, flooding more than 8,000 homes and damaging coastal infrastructure, including the main railway connecting Plymouth and other southwestern cities with the rest of England. “Extreme weather will continue to threaten communities this week, with further severe flooding expected Monday […]

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Unlimited oil from sunlight and slime changes the energy game

It is ironic that, just as we are finally saying goodnight and farewell to Peak Oil theory, scientists are poised to bring unlimited quantities of the finest sweet crude oil to market, courtesy of algae and sunlight. Moreover, the algae route to creating oil is said to generate 95% fewer greenhouse gasses than the conventional route of drilling for oil , so, even if climate change activists would rather that we stopped using oil altogether, “green oil” goes a long way towards meeting most of their objections. The technology is not new. Research has been going on for at least the last 30 years, but for much of that time, scientists found that they were having to put more energy into the process to grow the algae and extract the oil, than was contained in the oil – not exactly a winning proposition. […]

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Crude Holds Gains Near 2014 Highs

Crude-oil futures were choppy in Asian trading hours Monday but largely held on to gains made last week as markets await more economic data releases and energy agency reports in the next few days. On the New York Mercantile Exchange, light, sweet crude futures for delivery in March traded at $99.72 a barrel at 0642 GMT, down $0.16 in the Globex electronic session. March Brent crude on London’s ICE Futures exchange fell $0.39 to $109.18 a barrel. Both Brent and Nymex WTI crude pared early gains before slipping into negative territory. The oil benchmarks had settled at their highest levels so far this year on Friday on some supply concerns in the Middle East and strong U.S. winter fuel demand. "The front-month [U.S.] heating oil prices have been tracking five-year highs since early August, due to refining turnarounds, winter weather and low inventory levels," Barclays analyst Michael Cohen said […]

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Brent Slips After Biggest Gain in Three Months on Libya

Brent retreated after its biggest advance in three months as Libya continued to restore supplies and Saudi Arabia boosted crude sales in January. Futures lost as much as 0.6 percent in London , after a 2.2 percent rally on Feb. 7 that was the largest since October. Libya, a member of the Organization of Petroleum Exporting Countries, increased production after protests at the country’s Sharara field ended, according to National Oil Corp. Saudi Arabia, while trimming output last month, increased shipments to the market to 9.916 million barrels a day, according to a person with knowledge of the country’s supplies. “With the partial recovery of Libyan supplies the spare capacity of OPEC will be increasing and that scenario is not too far off,” said Andy Sommer, an analyst at Axpo Trading AG in Dietikon, Switzerland. Brent for March settlement fell as much as 70 cents to $108.87 a barrel […]

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Hedge Funds Boost Diesel Bets With Supply at Decade Low: Energy

Hedge funds are the most bullish on diesel in almost five months as the coldest January in 20 years boosted demand and cut U.S. supply to the lowest in a decade. Money managers increased net-long positions, or wagers on rising prices, by 29 percent in the week ended Feb. 4, the third consecutive gain, U.S. Commodity Futures Trading Commission data show. Long positions expanded by 5,016 contracts and short wagers fell by 1,020. Prices for diesel, traded as a proxy for heating oil, rose to the highest since 2012 as frigid weather spread across the U.S. Northeast, leading to curbs on natural gas pipelines that boosted oil demand. Refineries beginning seasonal maintenance may cut production this month, further reducing stockpiles near New York Harbor that are already the lowest since May 2003. “This is in reaction to cold weather supporting distillate demand and inventories continuing to decline as refineries […]

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U.N. nuclear agency sees 'good' progress with Iran, much work remains

The U.N. nuclear watchdog signaled its determination on Monday to get to the bottom of suspicions that Iran may have worked on designing an atomic bomb, a day after Tehran agreed to start addressing the sensitive issue. Chief U.N. nuclear inspector Tero Varjoranta said progress had been good during February 8-9 talks in Tehran but that much work remained in clarifying concerns of possible military links to Iran’s nuclear program, in an investigation which Western diplomats say Tehran has stonewalled for years. "There are still a lot of outstanding issues," Varjoranta, deputy director general of the International Atomic Energy Agency (IAEA), said at Vienna airport after returning from the Iranian capital. "We will address them all in due course." Iran denies Western allegations it seeks the capability to make nuclear weapons, saying such claims are baseless and forged by its foes. Years of hostile rhetoric and […]

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U.N. nuclear agency sees ‘good’ progress with Iran, much work remains

The U.N. nuclear watchdog signaled its determination on Monday to get to the bottom of suspicions that Iran may have worked on designing an atomic bomb, a day after Tehran agreed to start addressing the sensitive issue. Chief U.N. nuclear inspector Tero Varjoranta said progress had been good during February 8-9 talks in Tehran but that much work remained in clarifying concerns of possible military links to Iran’s nuclear program, in an investigation which Western diplomats say Tehran has stonewalled for years. "There are still a lot of outstanding issues," Varjoranta, deputy director general of the International Atomic Energy Agency (IAEA), said at Vienna airport after returning from the Iranian capital. "We will address them all in due course." Iran denies Western allegations it seeks the capability to make nuclear weapons, saying such claims are baseless and forged by its foes. Years of hostile rhetoric and […]

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Iran to Offer Oil Investors Better Terms Than Iraq, Adviser Says

Iran , bound by economic sanctions and seeking investment to help develop its oil and natural gas, plans to offer international energy companies more attractive contracts than neighboring Iraq , an Oil Ministry adviser said. The Islamic republic is developing a new type of contract that’s “in line” with international practice and law, Mehdi Hosseini, who leads a ministry committee reviewing oil contracts, said at a news conference in Tehran today. The new model will be more flexible and advanced that those investors encounter in fellow OPEC-member Iraq and will differ from what’s available elsewhere, he said. “Any new model will have to be win-win for all parties involved,” Hosseini said. “The new contract is our own type. We haven’t given it a name.” He reiterated that Iran plans to introduce the new contract at a conference in London in late June or early July. The Persian Gulf state […]

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Iran Offers New Pledges on Nuclear Transparency

Iran agreed to seven measures meant to shine increased light on its nuclear activities, including one that addresses Western concerns the work had a military dimension. Under Sunday’s agreement with the International Atomic Energy Agency, Tehran pledged to provide information on work it did on certain types of detonators that could be used to trigger a nuclear device. It also promised to provide updated plans for a heavy-water nuclear reactor and allow inspectors into a uranium mine and yellowcake concentration plant. Agreeing to detail the work on detonators was a first step to addressing Western suspicions that Iran has worked on a military nuclear program. While the actions promised are relatively modest, Western diplomats said they met the bar for the kind of steps Iran needed to take at this stage. However, some sources of the West’s concern remain shielded from U.N. experts, such as granting the IAEA renewed […]

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Iran Agrees to Provide Data on Its Detonators

Iran’s government committed to providing information on detonators for the first time on Sunday as part of a new series of confidence-building measures it agreed to with the United Nations’ nuclear watchdog. The measures include additional inspections of known nuclear sites and clarifications on questions the watchdog organization, the International Atomic Energy Agency, has asked Iran for years, the semiofficial Iranian Students’ News Agency reported. Under the agreement, Iran will provide more access to and information about uranium mines near the city of Yazd, a facility near the city of Ardakan, laser production, and its heavy-water reactor near Arak. The promise of information on detonator research is part of a dossier that has been heavily influencing Western views on Iran’s nuclear program, which Iran says is for energy purposes only, but the United States and other world powers suspect is a cover for producing a nuclear weapons […]

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Iran to introduce 'new generation' of oil contracts

Iran’s Petroleum Minister says it plans to introduce by June a new generation of oil contracts that are more attractive to investors. Iran’s Petroleum Minister says it plans to introduce by June a new generation of oil contracts that are more attractive to investors. Mahdi Hosseini, head of the contract revision committee in the ministry, told reporters Sunday that sanctions imposed on Iran over its nuclear activities drove the revisions. He said the new contracts are designed for the "post-sanction era, " but did not provide details. So far Iran has allowed oil companies to work on its fields under contracts known as "buybacks." Hosseini said many companies complained about their costs under this scheme. Iran signed in November a six-month interim deal with world powers in which it stops some nuclear activities in return for sanctions relief. It begins negotiations this month to reach a final deal. The […]

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Iran to introduce ‘new generation’ of oil contracts

Iran’s Petroleum Minister says it plans to introduce by June a new generation of oil contracts that are more attractive to investors. Iran’s Petroleum Minister says it plans to introduce by June a new generation of oil contracts that are more attractive to investors. Mahdi Hosseini, head of the contract revision committee in the ministry, told reporters Sunday that sanctions imposed on Iran over its nuclear activities drove the revisions. He said the new contracts are designed for the "post-sanction era, " but did not provide details. So far Iran has allowed oil companies to work on its fields under contracts known as "buybacks." Hosseini said many companies complained about their costs under this scheme. Iran signed in November a six-month interim deal with world powers in which it stops some nuclear activities in return for sanctions relief. It begins negotiations this month to reach a final deal. The […]

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Iraq governor gives Anbar militants one-week ultimatum

An Iraqi provincial governor Saturday gave militants controlling a city near Baghdad one week to surrender as government forces made steady progress in an effort to end a weeks-long crisis. The Anbar governor’s ultimatum was directed at anti-government fighters who have held Fallujah for more than a month. It comes amid a protracted surge in violence with security forces grappling with near-daily attacks nationwide in addition to the fighting in the western desert province. Analysts and diplomats have called for the Shiite-led government to address Sunni grievances in order to undermine support for militants, but with April elections looming, Prime Minister Nuri al-Maliki has taken a hard line. "People of Anbar, criminals have kidnapped Fallujah," Governor Ahmed al-Dulaimi said in a statement. "But, I swear to God, we will achieve victory against injustice and Fallujah will return to normal." Dulaimi gave anti-government fighters a week to lay down […]

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Shiite militias in Iraq begin to remobilize

The carnage has raised concerns that the Shiite militias that stalked members of the minority Sunni population in the dark days of 2006 and 2007 could be remobilizing, in response to attacks by Sunni extremists. Members of Asaib Ahl al-Haq, an Iranian-backed Shiite group responsible for thousands of attacks on U.S. forces during the Iraq war, admit they have ramped up targeted killings in response to a cascade of bomb attacks on their neighborhoods. “We’ve had to be much more active,” said an Asaib Ahl al-Haq commander who goes by the nom de guerre Abu Sajad. “Those who are trying to incite sectarianism, we have to deal with them,” he said, drawing his hand over his throat like a knife. More than 1,000 people were killed in January in Iraq, according to Agence France-Presse. That was the highest death toll since April 2008. Iraq’s Shiite-led government is struggling to […]

Posted On : Published By : Tom Whipple
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Break in Siege Is Little Relief to Syrian City

Civilians in Homs, Syria, left for a safer part of the city Sunday. Despite a cease-fire, aid convoys were attacked over the weekend. Bassel Tawil/Agence France-Presse — Getty Images ANTAKYA, Turkey — A three-day humanitarian cease-fire in the Syrian city of Homs was supposed to be a small breakthrough, a moment of relief for civilians trapped in a grim civil war. But mortar rounds and gunfire struck near aid convoys, damaging vehicles and leaving victims lying in the streets. Snipers fired on civilians as they fled their besieged neighborhood. Others refused to leave, fearing a massacre of those left behind. Limited food made it in, and some of the nearly 700 people who reached safety said they had been surviving on one meal a day and that some of their neighbors had resorted to eating grass. Though few expect the international peace talks that resume in Geneva on Monday […]

Posted On : Published By : Tom Whipple
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CNPC: PetroChina Makes Huge Gas Find in Sichuan Basin

PetroChina, Asia’s largest oil and gas producer, has found 308.2 billion cubic metres of technically recoverable gas in southwest China’s Sichuan basin, according to parent CNPC, one of China’s largest gas discoveries in more than a decade. China, the top energy user and fourth-largest consumer of gas, is racing to increase supply of the cleaner-burning fuel by boosting domestic exploration and raising imports, as demand is forecast to nearly quadruple between 2011 and 2030. The Moxi block of An’yue field was officially certified to hold 440.4 bcm of proven geological reserves, China National Petroleum Corporation (CNPC) said in Monday report on its website (news.cnpc.com.cn), citing PetroChina’s Exploration and Development department. PetroChina is now building a production facility able to pump 4 bcm a year under phase-1 development, which is to be followed by another 6 bcm/year in a second phase, CNPC said. CNPC […]

Posted On : Published By : Tom Whipple
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China export growth seen slowing, loans surging in January

China’s export and import growth likely cooled in January, a Reuters poll showed, underlining a broader slowdown in the world’s second-largest economy, though the Lunar New Year holiday effect may overstate the soft momentum. Weakness in China’s imports could be bad news for the rest of the world, particularly for major commodity exporters such as Australia. HSBC estimates China will overtake the United States to become the world’s biggest importer this year. Bank loans in China are expected to see a typical seasonal surge in January as banks get fresh lending quotas at this time every year, underlining relatively stable credit demand from the real economy. Many economists expect a soft slowdown in China’s economy in 2014 as policymakers try to embrace slower but better-quality growth to cut reliance on investment and pursue sustainable development. "Given the stable economic situation last year and increasing expectations over […]

Posted On : Published By : Tom Whipple
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Eleven dead in Japan after worst snowfall in decades hits capital

Eleven people died, more than a thousand were injured and tens of thousands lost power when the worst snowstorm in decades hit Tokyo and areas around the Japanese capital before heading north to blanket the tsunami-hit Pacific coast. Flights were still backed up at Tokyo’s Haneda international airport on Monday and the lobby was packed with anxious travelers, with some flights overbooked. As much as 27 cm (10.6 inches) of snow fell on Tokyo by late Saturday, the most in 45 years, Japan’s Meteorological Agency said. Back streets in outlying neighborhoods remained choked with snow and frozen slush on Monday morning, forcing commuters in heavy boots to pick their way carefully to work. Financial markets opened normally on Monday despite the heavy snowfall. Traffic accidents and falls claimed 11 lives across the nation, including one 78-year-old man in Ichikawa, just east of Tokyo. More than 1,000 […]

Posted On : Published By : Tom Whipple
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North Dakota Bakken/Three Forks Scenarios

Figure 1 A recent post at Peak Oil Barrel by Jean Laherrere suggested an ultimate recoverable resource(URR) for the North Dakota Bakken/Three Forks of about 2.5 Gb based on Hubbert Linearization.  This conflicts with a recent (April 2013) USGS mean (F50) estimate of 8.4 Gb.  I decided to update my scenarios based on the range of USGS estimates from F95=6 Gb to F5=11.3 Gb for the North Dakota(ND) Bakken/ Three Forks.  Note that at year end 2011 there were 2.6 Gb of crude proven reserves in ND and at the end of 2007 about 0.5 Gb, I will assume all of this reserve increase came from the Bakken/ Three Forks, so 2.1 Gb of proven reserves added to 0.35 Gb of oil produced from the Bakken/ Three Forks gives us 2.45 Gb for a minimum URR.  The Hubbert Linearization points to about 0.05 Gb of undiscovered oil whereas the USGS […]

Posted On : Published By : ASPO-USA
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U.S. Winter Storm Seen Spreading Snow, Sleet Across South

Rain, sleet and snow are expected to spread across the southern U.S., including Atlanta’s northern suburbs, less than two weeks after a winter storm stranded thousands of motorists and children in cars, buses and schools in the region. Atlanta’s northern suburbs may get 1 to 3 inches (2.5 to 7.6 centimeters) of snow through the next three days as the storm moves from Texas to the southern Appalachian Mountains, according to the U.S. Weather Prediction Center . The city itself will probably be spared this time, said Steve Wistar, a senior meteorologist at AccuWeather Inc . in State College, Pennsylvania . “In this storm it looks like Atlanta is in the southern edge,” Wistar said. “Because the south is less prepared to deal with some of these things it will be a real concern, but most of Georgia south of Atlanta will just get rain.” […]

Posted On : Published By : Tom Whipple
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Tight Propane Supply Reaches Crisis

Federal and state officials are pushing emergency measures to get propane to people who need the gas to heat their homes in the Midwest and other regions of the country beset by persistent frigid temperatures. The measures, which include extending working hours for truckers and ordering a pipeline company to prioritize shipments to areas with tight supplies, are meant to alleviate a propane crunch that has sent prices for the fuel to record highs in some parts of the country. "The propane shortage has been a crisis for thousands of families and farmers in Minnesota and across the region," Sen. Al Franken, who represents the North Star State, said in a statement. He has been asking various federal agencies to help route more propane to places in need. Governors in affected states are trying to increase propane deliveries and make funds available for residents to pay higher heating bills. […]

Posted On : Published By : Tom Whipple
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California drought hits farmers hardest

That’s about 650,000 boxes of cantaloupe, regular and organic, he won’t be harvesting come July — about $3 million worth of produce, he estimated. It’s a few hundred workers, most of them migrants, he won’t be hiring. It’s money that won’t be spent in grocery and hardware stores in small towns across the region that produces half of the country’s homegrown fruits and vegetables. It’s a lot of schools with empty seats as farm workers looking for jobs move on with their families. “Everybody will be hurt,” Del Bosque said. “When farmers idle land, the people who have small businesses in small communities . . . they’ll all suffer. It’s a huge ripple effect through the whole valley.” California is entering its third year of drought, a recurring nightmare for those old enough to remember the prolonged dry period of 1987 to 1991 and the disaster of 1976 and 1977, the previous […]

Posted On : Published By : Tom Whipple
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AAA Warns Drivers: Gas Prices Set to Rise

Filling Car With Gas AAA warned gas prices are set to rise this spring, after winter weather across many parts of the country kept demand low and provided a slight reprieve in recent weeks. Prices typically climb higher during the spring when refineries cut production to do seasonal maintenance. A regulated switch to summer-blend gasoline can also limit supplies, just as demand strengthens. AAA said expected peak prices of $3.55 to $3.75 a gallon would be lower than last year, when the national average jumped 49 cents to $3.79 a gallon in just 41 days. Bob Darbelnet, the travel group’s president and CEO, said the increase will likely be temporary, but it still may cost drivers in excess of $60 to fill up their cars. “There is a good chance that average gasoline prices this year will cost less than in 2013, but it is not going to be […]

Posted On : Published By : Tom Whipple
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The Oil Boom Doesn’t Care if Your Chickens Are Freezing to Death

Propane is a byproduct of both natural gas production and crude oil refining. Just in the past year, its production has spiked by 15 percent, and a good chunk of that new production is considered surplus, to be exported from brand new fuel terminals. In fact, just since 2012, propane exports have gone up from around 150,000 barrels to 400,000 barrels a day as of last October. It should be flush times the Hank Hills of rural America. But, according to The New York Times , it’s quite the opposite. Propane fuel prices have shot up in some areas by more than $2 a gallon since the beginning of winter, and as of the end of January, the national wholesale average for propane had more than doubled in less than a month’s time. If you’re of suburban or urban origin, […]

Posted On : Published By : Tom Whipple
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One of the world’s great investment thinkers is convinced fracking is causing earthquakes

Page added on February 8, 2014   “To me at least the connection is clear and statistically certain… far more certain than anything I ever see in the stock market or the economy.” That’s Jeremy Grantham, the highly-regarded co-founder of the $117 billion investment fund GMO, who predicted both the dot com crash of the late 1990s and the subprime meltdown a few years later. Above is an accompanying chart included in his  latest investment letter . Rather than pushing an investment idea here, he’s convinced there’s a causal link between a surge in earthquakes measuring above 3 on the richter scale in the US and the boom in  hydraulic fracturing  (“fracking”), the controversial drilling technique used to extract oil and gas from shale rock. His overall skepticism about fracking informs Grantham’s broader, bearish thesis about oil prices. In the investment letter he questions whether “this year’s $650 billion spent looking […]

Posted On : Published By : ASPO-USA