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Oil Drops as U.S. Supplies Pile Up

Crude-oil futures dropped in Asian trading hours Wednesday in anticipation of a further increase in U.S. oil stockpiles even as markets kept a close eye on the Ukraine crisis. On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $100.48 a barrel at 0510 GMT, down $0.80 in the Globex electronic session. June Brent crude on London’s ICE Futures exchange fell $0.26 to $108.72 a barrel. Late Tuesday, the American Petroleum Institute, a trade group, said its data showed U.S. crude-oil stocks rose by three million barrels in the week ended April 25. The closely watched oil data from the U.S. Energy Information Administration is due later Wednesday. Analysts surveyed by The Wall Street Journal expect an increase in oil stockpiles of 2.2 million barrels. Although the weekly increase from both measures should be below the 6.7 million barrel jump in weekly inventories […]

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WTI Heads for Second Monthly Drop on Stockpile Gain; Brent Falls

West Texas Intermediate headed for a second monthly drop amid speculation that crude inventories at an 83-year high expanded further in the U.S., the world’s biggest oil consumer. Brent slid in London . Futures lost as much as 1 percent in New York, declining for the first time in three days. Crude stockpiles probably increased by 2.2 million barrels to 399.9 million last week, according to a Bloomberg News survey before government data today. Supplies rose by 3 million, an industry report showed yesterday. Brent is poised for a rebound in April as sanctions on Russia were strengthened over the Ukraine crisis and gunmen opened fire at Libya’s parliament. “Anticipation of further inventory growth” is driving West Texas prices, Ric Spooner, a chief strategist at CMC Markets in Sydney, said by phone. “The possibility of supply disruptions arising from geopolitical uncertainty is up against the reality of sluggish demand […]

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US crude stocks up 3 million barrels last week, Cushing inventories rise: API

US crude stocks climbed 3 million barrels to 391.7 million barrels in the week that ended April 25, as inventories at the Cushing, Oklahoma, delivery hub rose, data Tuesday from the American Petroleum Institute showed. Analysts polled by Platts Monday were expecting a smaller, 2.1 million-barrel build in crude stocks, with some anticipating a 1 million-barrel draw at Cushing. Cushing stocks, however, rose 202,000 barrels to 26.241 million barrels in the week that ended April 25, but were down substantially from 49.7 million barrels in the year-ago period. Article continues below… Crude oil moving out of Cushing: trends and implications Featuring Alison Ciaccio and John Kingston A combination of new crude pipeline projects, along with the expanding reach of crude-by-rail movements, is starting to move crude oil out of Cushing. Alison Ciaccio and John Kingston discuss the trend. Watch the video . In […]

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Natural-Gas Futures Extend Gains on Demand Expectations

Natural-gas prices jumped for a second day Tuesday as weather forecasts called for temperatures that could prompt demand for gas to heat homes in some parts of the U.S. and produce electricity for air conditioning in others. Gas for June delivery rose 3.2 cents, or 0.8%, to $4.831 a million British thermal units on the New York Mercantile Exchange, the highest closing price since Feb. 26. The rally followed Monday’s 3.2% gain that was driven by strong commercial buying in the cash market as the May contract expired. Weather forecasts called for soaring temperatures in the West and across the South in the 10-day outlook beginning in May, with the thermometer topping 90 degrees Fahrenheit in Southern California and Texas. Utilities in those areas are expected to need more natural gas to cool homes. At the same time, lingering late season cool temperatures in the Midwest and Northeast were […]

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Just keeping up

HERE is a striking fact from James Hamilton: U.S. production of oil from tight formations is up 3.5 mb/d since 2005, and yet total global field production of crude from all sources is only up 2.3 mb/d. In other words, more than all of the increase worldwide over the last 8 years is attributable to U.S. tight oil production. Without U.S. tight oil, world oil production would be lower today than it was 8 years ago. Petrol prices have been ticking up in recent weeks, mostly for seasonal reasons. But the broader picture, Mr Hamilton points out, is one of surprising stability in prices. For most of the last three years oil has hovered around $100 a barrel, and the price of petrol has been correspondingly flat. But there is another way of looking at this stability; prices have remained relatively high in order to temper demand growth and […]

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U.S. Announces Actions to Enforce Iran Sanctions

The United States government escalated enforcement of its Iran sanctions on Tuesday, adding eight Chinese companies, a Dubai company and two Dubai-based executives to blacklists for evading American restrictions on Iranian weapons, oil and banking transactions. In coordinated announcements of the actions by the Treasury, State and Justice Departments, the government also offered a $5 million bounty for information leading to the arrest or conviction of Li Fangwei, a Chinese businessman also known as Karl Lee, a previous sanctions target, who is accused of abetting Iranian weapons procurement. The announcements said that he owned the eight Chinese companies and that he had been charged in a previously sealed indictment with several federal offenses, including conspiracy to commit money laundering, bank fraud and wire fraud. The announcements signaled the first significant enforcement of American sanctions directed at Iran in about three months, and seemed aimed at dispelling what Obama administration […]

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Kurdish oil exports set for May

The semiautonomous Kurdish government of Iraq is expected to start selling exported oil within the next few weeks, Turkey’s energy minister said Tuesday. A pipeline from the Kurdish north is sending oil to storage tanks in Ceyhan, a Turkish sea port. Exports of Kurdish oil, however, have been on hold because of the lingering stalemate between the Kurdish and central governments over who controls what in the Iraqi energy sector. "This oil belongs to Iraq [and] they may begin its export in May," he said . Oil from northern Iraq has been flowing north at around 100,000 barrels per day since the start of the week, he said. He gave no indication of the export destination, noting it was up to private sellers to determine who gets Kurdish oil deliveries. "[Turkey’s oil refiner] Tupras has its own contracts as a private company," he said. "I always say, they can […]

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Violence Kills 24 People in Iraq

Back-to-back bombs ripped through an outdoor market northeast of Baghdad on Tuesday, the deadliest in separate attacks that officials said killed 24 people on the eve of the first nationwide elections since the 2011 withdrawal of U.S. forces. The attacks are an apparent effort by the militants to discourage Iraqi voters from going to the polls on Wednesday in the first nationwide balloting since the 2011 withdrawal of U.S. forces. Tuesday’s attack took place in the town of Sadiyah, 140 kilometers (90 miles) northeast of Baghdad, a police officer said. One of the bombs was placed in the middle of the town’s main vegetable and meat market, he said, while the second was put near one of the exits — presumably trying to strike people fleeing from the first blast, a tactic widely used by insurgents in order to inflict as many casualties as possible. Officials said […]

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Unrest in Iraq Narrows Odds for Maliki Win

When a well-known journalist was shot dead at a checkpoint here last month, Prime Minister Nuri Kamal al-Maliki rushed to the scene. Speaking to a television camera, he promised “blood for blood.” In a city where hundreds die every month from explosions and gunshots, it was unusual for the prime minister to focus on a single murder. That scene, though, coming as it did just before elections, was a vivid demonstration of what diplomats and analysts say is Mr. Maliki’s best and last hope for securing a third term as prime minister: playing the strongman, a role Iraqis, for better or worse, are accustomed to seeing in their leaders. “Maliki is a man of power,” said Salah al-Robaei, 46, a university professor in Baghdad, who also called him “wise,” “tough” and a “great leader.” A strategy of showing toughness may win votes among Mr. Maliki’s Shiite constituency, […]

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Syria’s jihadist groups fight for control of eastern oilfields

A new and bloody front has been opened in eastern Syria as the country’s two most powerful jihadist groups battle for control of the region’s oilfields. The struggle for hundreds of thousands, if not millions, of dollars a day in much-needed funding highlights how controlling resources has become crucial to fighters from Islamic State of Iraq and the Levant (Isis) and Jabhat Al-Nusra. “The battles here aren’t over God or [President] Bashar al-Assad . They’re about oil,” said an activist in eastern Deir Ezzor province who asked not to be named. “Donors can turn the money pipeline on or off. But when you control an oil well, the pipeline never gets shutdown.” Since early 2014, infighting between Nusra, which is afiliated to al-Qaeda, and Isis, an al-Qaeda splinter group, has killed thousands in opposition-held regions of northern and eastern Syria. Clashes have intensified in eastern provinces in recent months […]

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Iraq's House of Cards

With the country collapsing around him, Nouri al-Maliki’s strongman image is a sham. And that’s exactly why he’s so dangerous. There is something truly paradoxical about Iraq’s April 30 parliamentary elections. Although there is near unanimity among observers that the past four years have been disastrous for the country, many are still willing to defend Prime Minister Nouri al-Maliki’s tenure — even going so far as to suggest that there is no one else who is capable of governing the country. However, the sad reality is that — given all the developments of his eight years in office — very few Iraqis are less suitable to be prime minister today than Maliki. Indeed, Maliki’s third term would likely be even more disastrous than his second, leading to a deterioration in security and causing the country to relapse into a new authoritarian era. Maliki’s defenders usually argue that the prime […]

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Iraq’s House of Cards

With the country collapsing around him, Nouri al-Maliki’s strongman image is a sham. And that’s exactly why he’s so dangerous. There is something truly paradoxical about Iraq’s April 30 parliamentary elections. Although there is near unanimity among observers that the past four years have been disastrous for the country, many are still willing to defend Prime Minister Nouri al-Maliki’s tenure — even going so far as to suggest that there is no one else who is capable of governing the country. However, the sad reality is that — given all the developments of his eight years in office — very few Iraqis are less suitable to be prime minister today than Maliki. Indeed, Maliki’s third term would likely be even more disastrous than his second, leading to a deterioration in security and causing the country to relapse into a new authoritarian era. Maliki’s defenders usually argue that the prime […]

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Elections unleash political flux in Kurdistan

The upstart Gorran party is likely to take control of key posts, upending the old political order and marking a new era of intra-Kurdish volatility. Iraqi Kurds need a strong showing in the country’s April 30 elections to ensure they retain leverage in Baghdad, but on the streets of the autonomous Kurdistan region, there is little talk of the national scene.When citizens go to the polls, they will also be casting ballots – for the first time in eight years – to determine the leadership of three provincial governments that comprise Kurdistan. The outcome of this vote will likely solidify a massive change in the balance of power among the… This content is for registered users. Please login to continue.If you are not a registered user, you may purchase a subscription or sign up for a free trial .

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Pro-Assad Areas Are Attacked in Syria, Pointing to Election Trouble

More than 50 people were killed in bomb, mortar and rocket attacks in government-controlled areas of Syria on Tuesday, as the international chemical weapons monitoring group declared that it was sending inspectors to the country to investigate suspected use of chlorine gas. The wave of attacks on civilian, mainly pro-government, areas in the capital, Damascus, and in the central city of Homs, came a day after President Bashar al-Assad formally announced plans to run for re-election. Taken together, the day’s events underscored the uncertainties around the elections planned for June 3, which government opponents widely regard as a sham, saying Mr. Assad’s victory is guaranteed. It remains unclear how the vote can be carried out safely amid the war, while insurgents still strike in the heart of government territory and the government bombards insurgent-held areas in major cities like Aleppo on a daily basis. While the […]

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Military Aid for Egyptians Loses Support in the Senate

Senator Patrick J. Leahy, chairman of the Senate subcommittee that oversees foreign aid, said Tuesday that he would not support additional military aid to Egypt in the wake of mass death sentences handed out by Egyptian courts this week, adding significant pressure on the Obama administration to shift course. For months, Senator Rand Paul, Republican of Kentucky, has led a lonely effort to sever American support to one of its most stalwart allies in the Middle East after the military’s overthrow of Egypt’s elected Islamist government. That push appears to be gaining steam. “I’m not prepared to sign off on the delivery of additional aid for the Egyptian military,” Mr. Leahy, a Vermont Democrat, said on the Senate floor. “I’m not prepared to do that until we see convincing evidence the government is committed to the rule of law.” On Monday, an Egyptian court sentenced the top […]

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Saudi Oil Faces Summer Heat Challenge: Chart of the Day

Saudi Arabia will probably have to sustain production above 10 million barrels a day for the longest period in more than 30 years as it meets the summer surge in domestic demand and compensates for production losses in Libya . The CHART OF THE DAY shows how, over the past half decade, Saudi Arabian crude oil burning for power generation expanded by an average of 500,000 barrels a day in the six months through August as people turned up their air conditioners. A repeat this year would eat up about 5 percent of the kingdom’s current output at a time when Libya, the holder of Africa ’s largest oil reserves, is all but offline. “The summer this year will pose the real challenge, particularly if most Libyan production remains offline,” Robin Mills, the head of consulting at Dubai-based Manaar Energy Consulting and Project Management, said in an interview. To […]

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Further blow for $50bn Kashagan oil project

The $50bn Kashagan oil project in Kazakhstan is likely to be delayed by two more years while 200km of pipeline is replaced, in a further blow for the companies developing the largest oilfield outside the Middle East. Erbolat Dossayev, Kazakhstan’s minister for economy and budget planning, told the FT that he expected production to start at the end of next year at the earliest – but that it could be delayed until 2016. It is the first public admission by the government that the project will not only fail to produce oil this year but may not resume production until 2016. “It will be two years,” added one industry official. It is a blow for the consortium of companies – including ExxonMobil , Royal Dutch Shell , Total , and CNPC – which have invested some $50bn in the project so far in the hope that it would one […]

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Giant Kashagan oilfield could be out of production for two years.

It has been reported by overnight that the super-giant  Kashagan oilfield in the northern Caspian sea “will be out of production for at least two years”. The shutdown has been necessitated by leaks of toxic gas from a pipeline, with Quartz reporting that two new pipelines will now be required to replace the two existing oil and gas pipelines.” “As reported in the FT last month , the Kashagan field had already been beset by problems over many years, with production  only beginning on 11 September last year, nearly a decade behind schedule. So far it has only produced at a rate of about 75,000 barrels a day for only one month, as it was shut in again in October shortly after beginning to produce when the problem of toxic-gas leaks first became apparent. The FT’s report had already […]

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Colombia Warns of Emergency Decree for Pipeline Standoff

A monthlong standoff with a forest-dwelling indigenous group is threatening Colombian oil exports and may force the government to declare a national emergency, Mines and Energy Minister Amylkar Acosta said. Members of Colombia ’s U’wa group are preventing repairs to the Cano Limon-Covenas pipeline following an attack by Marxist rebels March 25, cutting exports by more than 2.5 million barrels, Acosta said. The country’s second biggest pipeline is controlled by state-run Ecopetrol SA. “This almost merits a declaration of emergency by the national government,” Acosta told local radio station Caracol today. “There are reasons of state, and there’s a public interest that takes precedence.” A emergency declaration would give Colombian President Juan Manuel Santos powers to rule by decree for 30 days and potentially overrule standard protocol when dealing with local groups. Royalties from oil, Colombia’s biggest export, are a key source of revenue for the government, currently battling […]

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China poised to pass US as world’s leading economic power this year

The US is on the brink of losing its status as the world’s largest economy, and is likely to slip behind China this year, sooner than widely anticipated, according to the world’s leading statistical agencies. The US has been the global leader since overtaking the UK in 1872. Most economists previously thought China would pull ahead in 2019. The figures, compiled by the International Comparison Program hosted by the World Bank, are the most authoritative estimates of what money can buy in different countries and are used by most public and private sector organisations, such as the International Monetary Fund. This is the first time they have been updated since 2005. After extensive research on the prices of goods and services, the ICP concluded that money goes further in poorer countries than it previously thought, prompting it to increase the relative size of emerging market economies. The estimates of […]

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Confronting China’s water insecurity

Among the numerous challenges China faces in its quest to become a great power, the biggest, perhaps, is mounting water insecurity. China has 20 per cent of the world’s population but only 7 per cent of the world’s fresh water. To make matters worse, the country’s scarce water resources are unevenly distributed between the south and north of the country. With rapid industrialisation and urbanisation, the demand for fresh water is increasing at a very fast rate. It is forecast that by 2030, China’s water demand will surpass 800 billion cubic metres. However, China’s supply is severely undermined by worsening water scarcity and pollution. SCARCITY AND POLLUTION Due to over-exploration and inefficient consumption, China’s water resources are declining as more rivers disappear and aquifer water levels drop. A 2013 report published by the Chinese authorities showed that the number of rivers in China has decreased from at least 50,000 […]

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U.S. probes waves as source of energy

More than $10 million will be invested into a program that will test the ability to convert wave energy into a source of power, the U.S. Energy Department said. The Energy Department announced the test program for wave energy off the coast of Hawaii. "The Energy Department-supported demonstrations at the U.S. Navy’s wave energy test site off Hawaii’s island of Oahu will help develop reliable wave energy options and collect important performance and cost data for wave energy conversion devices," it said in a Monday statement . Two prototype wave energy converters will be deployed in open waters at depths of 196 feet and 260 feet. The demonstration projects are aimed at examining wave energy technology that’s in the late stage of development or close to full-scale operations. The test program will run for one year. The project gives the federal government the ability […]

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Supreme Court Revives EPA Rule on Air Pollution Across State Lines

The Environmental Protection Agency can reinstate limits on power-plant pollution that blows across state lines, the Supreme Court ruled Tuesday, handing a defeat to electric utilities that opposed the effort as costly regulatory overreach. The court’s 6-2 ruling breathes new life into a 2011 EPA measure known as the Cross-State Air Pollution Rule, which requires 28 states to reduce emissions that hurt air quality in states located downwind. The regulation stands to affect about 1,000 power plants in the eastern half of the U.S. that may have to adopt new pollution controls or reduce operations. The decision could further threaten the viability of some aging coal plants, which already face other market and regulatory pressures. "There is no doubt this will add some cost pressures," said University of Notre Dame law professor Bruce Huber. "This is an exceedingly important opinion," he said, adding that the EPA "has been trying […]

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Better tech cuts US oil, gas production costs, foils estimates: EIA's Sieminski

Recent improvements in hydraulic fracturing technology have lowered oil and gas production costs, which in turn enable the industry to drill more wells and increase production, Adam Sieminski, the administrator of the US Energy Information Administration, said Tuesday. The changes are also making it harder for federal statisticians to keep up and make reasonable projections on future production. Those changes were a major reason why the most recent EIA Energy Outlook underestimated on oil production in 2014, he said. Speaking before the Natural Gas Roundtable in Washington, Sieminski said predicting how much natural gas will be put in storage this year is a challenge. A significant unknown is whether there will be the summertime equivalent of a polar vortex. The three polar vortexes in January caused record low temperatures and unprecedented demand for natural gas. Article continues below… Gas Daily offers the most detailed […]

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Better tech cuts US oil, gas production costs, foils estimates: EIA’s Sieminski

Recent improvements in hydraulic fracturing technology have lowered oil and gas production costs, which in turn enable the industry to drill more wells and increase production, Adam Sieminski, the administrator of the US Energy Information Administration, said Tuesday. The changes are also making it harder for federal statisticians to keep up and make reasonable projections on future production. Those changes were a major reason why the most recent EIA Energy Outlook underestimated on oil production in 2014, he said. Speaking before the Natural Gas Roundtable in Washington, Sieminski said predicting how much natural gas will be put in storage this year is a challenge. A significant unknown is whether there will be the summertime equivalent of a polar vortex. The three polar vortexes in January caused record low temperatures and unprecedented demand for natural gas. Article continues below… Gas Daily offers the most detailed […]

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Pipeline Supporters Seek Quick Senate Vote

Supporters of the proposed Keystone XL pipeline are seeking a swift Senate vote on legislation to approve construction of the project that environmentalists oppose strongly and the Obama administration has delayed indefinitely. Pipeline advocates in the Senate, who include several Democrats on the November election as well as Republicans, hold a clear majority. They also may command more than the 60 votes needed to overcome blocking tactics by opponents, but they appear to be short of the two-thirds majority that would be needed in the 100-member chamber to override any veto by President Barack Obama. "I will press hard for a vote in the coming weeks to build this pipeline," Sen. Mary Landrieu, a Democrat and the chair of the Senate Energy Committee, said this week in a statement as lawmakers returned from a two-week break. Landrieu and Sen. Mark Begich, […]

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Exxon’s $900 Billion Arctic Prize at Risk After Ukraine

Exxon Mobil (XOM) Corp.’s dream of drilling in the Russian Arctic may risk running aground on the politics of Ukraine. The company plans to start drilling in August in the Arctic’s remote Kara Sea — the centerpiece of Exxon’s global alliance with Russian state-controlled OAO Rosneft. (ROSN) The partnership, which includes shale exploration in Siberia and joint venture fields in Texas , will come under greater scrutiny after the U.S. placed sanctions on Rosneft’s Chief Executive Officer Igor Sechin . “With Sechin being sanctioned it may complicate relations for Rosneft with western companies,” said Mattias Westman, who oversees about $3.3 billion in Russia assets as CEO of Prosperity Capital . “Maybe some transactions will be threatened as a result and perhaps Russia will counter and they will be less keen for American companies to work on Arctic projects.” Patrick McGinn, a spokesman for Exxon’s exploration arm, said on April […]

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Gazprom sales to Europe increased in 2013

Russian energy company Gazprom said Tuesday its sales of gas to Europe and others in the region was up more than 15 percent in 2013. Russia supplies about a quarter of the natural gas consumed in Europe, and most of that runs through a pipeline system in Ukraine, a former Soviet republic that’s tilted toward the European Union since political conflict erupted in November. Gazprom said in a report highlighting its financial results from 2013 that gas sales to Europe and other countries in the region totaled 6.1 trillion cubic feet, an increase of more than 15 percent from 2012. European leaders have looked to rival suppliers in Azerbaijan in an effort to break Russia’s grip on the region’s energy supply. European Commission President Jose Manuel Barroso said following his meeting Monday with Slovakian Prime Minister a move to reverse gas flows from Slovakia […]

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Ukraine separatists seize second provincial capital, fire on police

Hundreds of pro-Moscow separatists stormed government buildings in one of Ukraine’s provincial capitals on Tuesday and fired on police holed up in a regional headquarters, a major escalation of their revolt despite new Western sanctions on Russia. New U.S. and EU sanctions packages, announced with fanfare, were seen as so mild that Russian share prices rose in relief. A small number of names were added to existing blacklists, while threats to take more serious measures were put on hold. Nevertheless, Russian President Vladimir Putin responded by threatening to reconsider Western participation in energy deals in Russia, the world’s biggest oil producer, where most major U.S. and European oil companies have extensive projects. Demonstrators smashed their way into the provincial government headquarters in Luhansk, Ukraine’s easternmost province, which abuts the Russian border, and raised separatist flags over the building, while police did nothing to interfere. As […]

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Putin Says Sanctions Jeopardize U.S., EU Energy Deals

Russian President Vladimir Putin warned that further economic sanctions over the Ukraine crisis may lead Russia to reconsider participation by U.S. and European Union companies in energy and other key industries. While his government has prepared measures to retaliate for penalties imposed by the U.S. and its allies, Putin told reporters in Minsk, Belarus, yesterday that he doesn’t consider them necessary for now, though that may change. If sanctions continue, “then of course we will have to consider who’s working and how in the Russian Federation, in the key sectors of the Russian economy, including energy,” he said. “We really don’t want to take these reciprocal steps.” Putin’s remarks added uncertainty for companies that have stakes in Russia’s energy industry, including Royal Dutch Shell Plc and Exxon Mobil Corp. (XOM) , which is planning Arctic drilling in an alliance with Russian state-controlled OAO Rosneft. (ROSN) The Russian leader spoke […]

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Total’s First-Quarter Profit Slides 10% on Refining, Output

Total SA (FP) ’s first-quarter profit fell 10 percent as refining margins and output slumped at France ’s largest oil producer. Profit excluding changes in inventories dropped to $3.33 billion from $3.7 billion a year earlier, the Courbevoie, France-based company said today in a statement. The result compared with the $3.39 billion average of 10 analyst estimates compiled by Bloomberg. Production slid 6 percent to 2.179 million barrels of oil equivalent a day. Total declined 0.5 percent to 51.26 euros by 9:53 a.m. in Paris trading, paring gains for the year to 15 percent. The company follows BP Plc (BP/) and Italy ’s Eni SpA (ENI) in reporting lower first-quarter earnings. As the biggest refiner in western Europe , where it operates eight plants, Total has been hurt by lower crude-processing margins caused by overcapacity. Oil output fell after the loss of concessions in Abu Dhabi. Since the start […]

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Royal Dutch Shell Profit Falls on Refining Charge

Royal Dutch Shell PLC on Wednesday reported a fall in first-quarter profit after taking a $2.86 billion impairment charge largely on its refineries in Asia and Europe. The company also raised its dividend and said it is considering the sale of certain marketing assets in Norway. The results were the first for the oil giant under the leadership of Ben van Beurden, who took over as chief executive in January. "The impairments we have announced today in downstream reflect Shell’s updated views on the outlook for refining margins," Mr. van Beurden said. Shell first-quarter profit on a current cost of supplies basis—a figure that factors out the impact of inventories, making it equivalent to the net profit reported by U.S. oil companies—fell 44% to $4.47 billion. First-quarter revenue fell to $109.66 billion in the quarter, from $112.81 billion a year earlier, while net profit fell to $4.51 billion, compared […]

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Wrong Type of Ice Hampers the Northern Sea Route

Energy giants SA, Russia’s OAO Novatec and China National Petroleum Co. are investing $27 billion to develop Yamal LNG, one of the world’s biggest gas export facilities deep inside the Arctic Circle in western Siberia. Yamal, "the end of the earth," in the local Nenets language, will require building LNG tankers powerful enough to smash through heavy ice. But engineers still haven’t figured out how to evacuate crew from those tankers in an emergency—underscoring how some of the industry’s trickiest obstacles in the Arctic are also some of the most basic. As warming seas melt arctic ice, shipping executives have been exploring the prospect of more commercial voyages through once-impassable waters. One of the most promising new thoroughfares is the Northern Sea Route, a passage through one of Russia’s northernmost archipelagoes. During a few warm months of each year, the route is now increasingly passable to ship traffic. Traversing […]

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Russia Ships First Arctic Oil, Fortifies Oil Defenses

Riding on his pride in the first export of Russian Arctic oil earlier this month, President Vladimir Putin has signed a law that allows oil and gas corporations to establish private armed security forces to defend their infrastructure, upping the ante for protestors. On the same day, April 22, Earth Day, Putin also met with the Russian Security Council. There he said, “Oil and gas production facilities, loading terminals and pipelines should be reliably protected from terrorists and other potential threats. Nothing can be treated as trivia here.” Meeting of Russia’s Security Council on Arctic policy, The Kremlin, April 22, 2014 (Photo courtesy Presidential Press and Information Office) At the Russian Security Council meeting Putin detailed Russia’s Arctic policy, which includes strengthening military infrastructure in the region, “by restoring a number of airfields beyond the Arctic Circle and the military base on the New Siberian Islands.” Putin also said […]

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The Energy Independence Illusion

The roots of energy independence lie in the energy crises of the 1970s. US oil production peaked in 1970, and we became increasingly dependent on oil imported from the Middle East. In response to US support for Israel, OPEC cut production and doubled prices in 1973 and again in 1979. The economy stagnated for most of the decade, and Americans recoiled at the thought of the economy and foreign policy being held hostage by Arab sheiks. Independence from these threats then became a key national objective. An effort was made to increase domestic exploration, develop alternative fuels, and conserve energy. Automobile gas mileage standards were increased, natural gas displaced oil in industry and home heating, and the generation of electricity from oil was phased out. The Strategic Petroleum Reserve was put in place as a buffer against supply disruptions, and the Carter Doctrine in the wake of the Iranian […]

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Oil Seen Stable on Iraq Election Uncertainty as Bombs Mar Vote

Oil markets will see little lasting reaction to the uncertainty around Iraq ’s next government amid elections this week that are expected to yield no clear majority, according to analysts at IHS Inc. and JBC Energy GmbH. Prime Minister Nouri al-Maliki is banking on revenue from the highest crude production in 35 years to win him a third term in office when voting takes place tomorrow, even as Iraq struggles to improve security and upgrade roads, ports and housing for its 33 million people. At least 50 were killed in bombings yesterday, some targeting polling stations. “Unfortunately, violence in Iraq is not a shock to the market,” Jim Burkhard, head of Global Oil Markets at IHS Energy, said yesterday in Dubai. “Unless there’s a debilitating attack on oil infrastructure, it wouldn’t have a lasting impact on oil prices.” Maliki first took power in 2006 and after the next vote […]

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Brent Rebounds on Ukraine After Biggest Loss in Month

Brent crude rebounded amid additional U.S. sanctions against Russia over the Ukraine crisis, after dropping the most in almost a month yesterday. West Texas Intermediate advanced before fuel inventory data. Brent climbed as much as 0.5 percent after declining yesterday as Libya prepared to resume oil exports from the eastern port of Zueitina. The U.S. added seven individuals to its sanctions list yesterday, including the chief executive officer of OAO Rosneft, the state-run Russian oil company . U.S. crude supplies probably expanded by 1.1 million barrels last week while gasoline inventories dropped, according to a Bloomberg News survey before an Energy Information Administration report tomorrow. “The crisis in Ukraine continues to pose a major risk,” Ole Sloth Hansen, head of commodity strategy at Saxo Bank A/S in Copenhagen, said in a report. “It has not led to any interruption in oil supplies yet and this leaves the market exposed […]

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Russia and Iran Reported in Talks on Energy Deal Worth Billions

The Obama administration’s strategy of punishing Russia with economic sanctions over the Ukraine crisis encountered a new complication on Monday with word that the Russians are negotiating an $8 billion to $10 billion energy deal with Iran, another country ostracized by American-led sanctions, which partly depend on Moscow’s cooperation to be effective. The Russia-Iran energy deal, reported by the Iranian state news media, is the second significant economic collaboration under negotiation between the two countries that could undercut the efficacy of the sanctions on Iran. Those sanctions are widely credited with successfully pressuring the Iranians in the current talks over their disputed nuclear program. Officials at the United States Treasury Department, which enforces economic sanctions against Iran, did not immediately respond to queries about whether the Russia-Iran energy deal would technically violate those sanctions, which prohibit dealings with a range of Iranian government entities and industries and penalize foreigners […]

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Iran Cancels $2.5 Billion Deal With Chinese Oil Company

Tehran said Tuesday it was canceling a $2.5 billion deal with China National Petroleum Corp. for the development of a giant Iranian oil field, as privileged ties between both nations face mounting challenges. China had stepped in after Western oil companies pulled out of Iran following a European ban on investing in the Islamic Republic. But an interim nuclear deal between Iran and six world powers has led the Islamic Republic to be more assertive toward Beijing, which some officials say has unduly taken advantage of international sanctions. Following repeated delays, "termination of the company’s South Azadegan oil field development project has been issued," Iran’s oil ministry website Shana quoted Roknoddin Javadi, the managing director of the National Iranian Oil Co., as saying. CNPC didn’t return a request for comment. —Wayne Ma in Beijing contributed t this article

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Iran decides to take Azadegan oil field back from China's CNPC: report

Tehran (Platts)–29Apr2014/455 am EDT/855 GMT Iran will remove China National Petroleum Corp from the major Azadegan oil field project due to "lack of commitment," oil ministry news service Shana reported Tuesday. This follows an order from the Iranian oil minister Bijan Zanganeh. The Chinese company inked the deal with Iran more than four years ago. "Following repeated verbal and written warnings and a written warning issued last winter, CNPC promised to move the project forward," Rokneddin Javadi, managing director of National Iranian Oil Company, was quoted as saying. "Even though one month extra was given to this company after the 90-day ultimatum, no effective work has been done by this contractor. Therefore, since this Chinese contractor did not fulfill its commitments during this period, the order to end the company’s contract in the development of South Azadegan will be issued," Javadi said. He stressed that the oil ministry did […]

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Iran decides to take Azadegan oil field back from China’s CNPC: report

Tehran (Platts)–29Apr2014/455 am EDT/855 GMT Iran will remove China National Petroleum Corp from the major Azadegan oil field project due to "lack of commitment," oil ministry news service Shana reported Tuesday. This follows an order from the Iranian oil minister Bijan Zanganeh. The Chinese company inked the deal with Iran more than four years ago. "Following repeated verbal and written warnings and a written warning issued last winter, CNPC promised to move the project forward," Rokneddin Javadi, managing director of National Iranian Oil Company, was quoted as saying. "Even though one month extra was given to this company after the 90-day ultimatum, no effective work has been done by this contractor. Therefore, since this Chinese contractor did not fulfill its commitments during this period, the order to end the company’s contract in the development of South Azadegan will be issued," Javadi said. He stressed that the oil ministry did […]

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Militants Pose Threat on Eve of National Elections in Iraq

Snipers line the rooftops across Falluja, waiting for a chance to shoot at government soldiers, should they try to invade. Homes have been wired to explode, too, just in case the government rushes the city. And roads have been studded with countless steel-plated bombs, of the type that killed so many American soldiers here. Falluja — and the rest of Anbar Province — perhaps more than any other locale in Iraq, embodies the lengths the United States went to tame a bloody insurgency unleashed by its invasion. But now, much of the region is again beyond the authority of the central government and firmly in the control of the Islamic State of Iraq and Syria, a jihadist group that is so radical it has broken with Al Qaeda, in part because it insisted on being allowed to indiscriminately kill Shiites. That reality, which the government appears powerless […]

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Iraq: Bombs kills at least 11 people in market

Officials say a back-to-back bomb attack in an outdoor market northeast of the Iraqi capital, Baghdad, killed at least 11 people. A police officer says Tuesday’s attack took place in the town of al-Saadiyah, 140 kilometers (90 miles) northeast of Baghdad. He added that at least 19 other people were wounded. A medical official confirmed casualty figures. Both officials spoke on condition of anonymity as they were not authorized to release information. The attack came a day after a series of attacks killed at least 46 people, the latest violence aimed at discouraging Iraqi voters from going to the polls on Wednesday in the first nationwide elections since the 2011 withdrawal of U.S. forces. More than 9,000 candidates are vying for 328 seats in Parliament.

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EFFECTS OF THE AL-ANBAR CRISIS ON IRAQ'S WATER MANAGEMENT

As a vitally important resource both for the economy and survival, water turns out to be a matter of conflict in the domestic policy and this inevitably poses threat for the whole of Iraq Updated : Published : The clashes that erupted at the end of 2013 in Fallujah, a city in the Iraqi province of al-Anbar, have continuously posed a danger for the security of the country. There are no estimations as to when the conflict between the Islamic State of Iraq and the Levant (ISIL), an al-Qaeda-linked organization, and troops of the central Iraqi government will come to an end. This conflict has regional influences as well. Some ISIL-affiliated groups active in the cities of Fallujah and Ramadi seized the control of the Fallujah dam.The dam, built for irrigation in 1985, does not include a hydroelectric power station. The Iraqi general staff explained that the dam, constructed […]

Posted On : Published By : Tom Whipple
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EFFECTS OF THE AL-ANBAR CRISIS ON IRAQ’S WATER MANAGEMENT

As a vitally important resource both for the economy and survival, water turns out to be a matter of conflict in the domestic policy and this inevitably poses threat for the whole of Iraq Updated : Published : The clashes that erupted at the end of 2013 in Fallujah, a city in the Iraqi province of al-Anbar, have continuously posed a danger for the security of the country. There are no estimations as to when the conflict between the Islamic State of Iraq and the Levant (ISIL), an al-Qaeda-linked organization, and troops of the central Iraqi government will come to an end. This conflict has regional influences as well. Some ISIL-affiliated groups active in the cities of Fallujah and Ramadi seized the control of the Fallujah dam.The dam, built for irrigation in 1985, does not include a hydroelectric power station. The Iraqi general staff explained that the dam, constructed […]

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On Eve of Elections, Demoralized Army Is Losing Fight Against Islamist Militants

Even as an al Qaeda-linked militant group celebrated a major victory in Western Iraq last month, militants from the same jihadist group launched another operation clear across the country. In coordinated predawn attacks, gunmen blew up two bridges in a village outside the eastern town of Qara Tepe. They detonated a fuel tanker at a police base close to nearby Injana, shot 12 soldiers and incinerated their bodies. By afternoon, militants had attacked four other police and army checkpoints. Instead of bolstering their ranks, some police and military checkpoints simply packed up and left. Lacking protection, hundreds of villagers fled their homes for larger towns. "The security forces are weak, and they are putting the responsibility for their weakness on us," says Aziz Latif, a farmer who fled the village of New Sari Tepe after it was attacked on March 21. "They are not professional." More than […]

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Levant basin rich in reserves for Israel

Oz license area off the coast of Tel Aviv thought to be rich in oil and gas. JERUSALEM, April 28 (UPI) — While less than the Tamar and Leviathan prospects off the Israeli coast, the Oz license area may hold significant deposits of oil and gas, a study finds. Sewell & Associates, a Dutch oil and gas consulting company, finds the Oz license area, about 30 miles off the coast of Tel Aviv, may hold more than 1.1 trillion cubic feet of natural gas and 93 million barrels of oil. Roni Halman, chairman of Oz license partner Israel Opportunity, said Saturday the estimates beat early expectations. "The Levant basin is rich with gas, and we believe also in oil, which has a huge potential," he said . Though considerable, Oz holds less than the giant Leviathan and Tamar basins off the Israeli coast. Production at Tamar began last year. […]

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50 killed in bomb attack on rally, police and troops voting in Iraq

Fifty people were killed on Monday as suicide bombers attacked a political rally and Iraqi police and soldiers cast their votes early for a national election in two days’ time, authorities and witnesses said. A suicide attacker killed at least 30 people and wounded 50 others at a Kurdish political gathering in the town of Khanaqin, 140 km (100 miles) northeast of Baghdad, security sources said. The Kurds were celebrating the television appearance of Iraqi President Jalal Talabani, a Kurd incapacitated since late 2012, who cast his vote in Germany where he was undergoing medical treatment. "The attacker snuck among the crowds near the Patriotic Union of Kurdistan’s headquarters and blew himself up, causing a tragic massacre," one police officer said, sobbing after he discovered his brother was among those killed. Meanwhile, Sunni Muslim militants, mostly disguised in army and police uniforms, struck at polling centers […]

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Libya Ends Suspension of Crude Loadings From Zueitina Terminal

Libya opened the way for oil exports to resume from the eastern port of Zueitina by revoking a legal clause known as force majeure after rebels returned the terminal to government control earlier this month. The 70,000 barrel-a-day facility is ready to receive tankers for loading, Mohamed Elharari, spokesman of state-run National Oil Corp., said today in a text message. An agreement reached on April 6 provided for the rebels to hand over control of Zueitina and Hariga, two of the four ports they seized in July, in return for an official amnesty and salary payments claimed by defectors from Libya’s Petroleum Facilities Guard. “It seems the government has been making a renewed effort for progress,” Richard Mallinson, an analyst at Energy Aspects Ltd. in London , said by e-mail. “It still seems to be a complicated situation on the ground, and the market will want to see a […]

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