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London: Scotland may face huge energy bills alone

Scottish consumers may end up paying "considerably more" to support an energy sector if they break from the United Kingdom, the British government said. The British government published a report Wednesday saying a single energy market would be better for the region’s economy. Scotland is to hold a referendum for independence from the United Kingdom in September. Its government says it could support itself in part with revenue from North Sea oil and natural gas reserves while powering its economy through renewable energy reserves. British Secretary of State for Energy and Climate Change Ed Davey said a united market has helped support the Scottish energy sector and has kept consumer energy bills down. "Scottish consumers would end up paying more, possibly considerably more, for energy infrastructure in an independent Scottish state than they do as part of the United Kingdom," he said in a […]

Posted On : Published By : Tom Whipple
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Crude Rally Stalls Amid Mixed Signals

Brent crude oil is trading slightly lower Wednesday after tension surrounding Ukraine pushed the price up by almost $2 in the previous session. Fundamental factors of increasing supply at a time of low demand are keeping prices in check, but geopolitical issues are still be having a supportive effect. Brent crude for May delivery was down 13 cents at $107.54 a barrel on ICE Futures Europe. U.S. crude-oil futures were down 32 cents at $102.24 a barrel on the New York Mercantile Exchange. Tuesday, the Brent crude price rose to close up $1.85, to a seven-session high, while West Texas Intermediate climbed $2.12 to a one-month high. "Geopolitical concerns surrounding Ukraine which were heating up the market at the start of March appear to have made something of a comeback," said JBC Energy analysts in a note to clients. But the gradual return of Libyan crude, […]

Posted On : Published By : Tom Whipple
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Crude-Oil Futures Ease; U.S. Stocks, Ukraine in Focus

Crude-oil futures eased in Asian trading hours Wednesday but held on to most gains from overnight as investors consider U.S. oil inventory data, heightened tensions in Ukraine and weak fundamentals. On the New York Mercantile Exchange light, sweet crude futures for delivery in May traded at $102.23 a barrel at 0440 GMT–down $0.33 in the Globex electronic session. May Brent crude on London’s ICE Futures exchange fell $0.14 to $107.53 a barrel. Data from the American Petroleum Institute industry group late Tuesday showed U.S. oil inventories rose by 7.1 million barrels last week while stocks at the Nymex delivery hub of Cushing, Okla. rose unexpectedly by 200,000 barrels. More definitive inventory data from the U.S. Energy Information Administration is due later today. Analysts surveyed by The Wall Street Journal expect inventories rose by 1 million barrels, on average, in the week ended April 4. "Market expectations are for a […]

Posted On : Published By : Tom Whipple
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WTI Retreats From Month-High as Crude Supplies Gain

West Texas Intermediate retreated from the highest price in a month after an industry report showed crude inventories increased in the U.S., the world’s biggest oil consumer. Brent slipped after the Libyan government said it was working to resume exports from two ports handed over by rebels. Futures slid as much as 0.5 percent in New York after the American Petroleum Institute said crude stockpiles expanded by 7.08 million barrels last week. Government data today will probably show a 750,000 barrel gain, according to a Bloomberg News survey. Rebels in Libya said they will not backtrack on the handover of two oil ports to the government, while they are standing by a demand for a share of oil revenue before they surrender a further two export terminals. “Comfortable fundamentals, with slack demand and plentiful supply, are weighing on the market,” Andrey Kryuchenkov , an analyst at VTB Capital in […]

Posted On : Published By : Tom Whipple
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Oil stays above $102 per barrel on Ukraine unrest

Oil declined Wednesday but stayed above $102 per barrel amid unrest in eastern Ukraine and the possibility of lower U.S. production. Benchmark U.S. crude oil for May delivery was down 44 cents to $102.12 at 0910 GMT in electronic trading on the New York Mercantile Exchange. The contract gained $2.12 to $102.56 on Tuesday. Brent crude, used to set prices for international oil varieties, shed 26 cents to $107.37 on the ICE exchange in London. Traders are uneasy about possible disruption of supplies due to conflict in eastern Ukraine and possible European sanctions on Russia. Pro-Russian separatists have seized government buildings in several cities in Ukraine’s east in the aftermath of Russia’s annexation of Crimea. Also this week, the U.S. Energy Department lowered its 2014 crude production forecast to 8.37 million barrels a day from 8.39 million barrels. – Wholesale gasoline shed 0.2 cent to $2.978 a gallon. – […]

Posted On : Published By : Tom Whipple
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Natural Gas Advances on Tight Supply Outlook

Natural-gas prices beefed up Tuesday as a new government forecast projected stockpiles, currently at 11-year lows, would stand at their lowest level since 2005 heading into next winter. Natural gas for May delivery settled up 5.8 cents, or 1.3%, at $4.534 a million British thermal units on the New York Mercantile Exchange. Natural-gas supplies will total 3.422 trillion cubic feet by the end of October, the lowest pre-winter level in nine years, the U.S. Energy Information Administration said Tuesday. The five-year average for the last week of October is 3.832 tcf. Frigid temperatures this past winter have eaten away at natural-gas stockpiles amid record demand for the heating fuel. About half of all U.S. households use natural gas as their primary heating fuel, according to the EIA. Inventories stood at 822 billion cubic feet as of March 28, the lowest level since 2003. Natural-gas stocks […]

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Short-Term Energy and Summer Fuels Outlook

Highlights During the April-through-September summer driving season this year, regular gasoline retail prices are forecast to average $3.57/gallon (gal). The projected monthly national average regular retail gasoline price falls from $3.66/gal in May to $3.46/gal in September. EIA expects regular gasoline retail prices to average $3.45/gal in 2014 and $3.37/gal in 2015, compared with $3.51/gal in 2013. The July 2014 New York Harbor reformulated blendstock for oxygenate blending (RBOB) futures contract averaged $2.85/gal for the five trading days ending April 3, 2014. Based on the market value of futures and options contracts for this key petroleum component of gasoline, there is a 3% probability that its price at expiration will exceed $3.35/gal, consistent with a monthly average regular-grade gasoline retail price exceeding $4.00/gal in July 2014 (see EIA Summer Fuels Outlook slideshow ). The North Sea Brent crude oil spot price in March averaged near $110 per barrel (bbl) […]

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One in Five Global Shale Basins May Succeed

Only one in five global shale regions may succeed in producing significant amounts of oil and gas as countries from to Argentina seek to emulate the U.S. boom, said energy consultants Wood Mackenzie Ltd. Argentina is leading the pack, with plans to drill about 200 shale wells this year, more than three times the number in China, Andrew Latham, Wood Mackenzie’s vice president for exploration research, said in an interview in Perth, Western Australia, where he’s attending an industry conference. “You hear people talk about lots of different basins,” Latham said yesterday. “It’s all good, but it’s all potential, and I’d be surprised if more than one in five plays that gets drilled ever becomes commercially significant in terms of production. You only get to be one of the five by drilling.” Shale explorers are targeting China, Russia, Australia, India, South Africa and Argentina in pursuit of deposits similar […]

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Cars Become Biggest Driver of Greenhouse-Gas Increases

The greatest emerging threat to the global climate may rest in the side pocket of your trousers — or wherever you keep the car keys. Emissions from transportation may rise at the fastest rate of all major sources through 2050, the United Nations will say in a report due April 13. Heat-trapping gases from vehicles may surge 71 percent from 2010 levels, mainly from emerging economies, according to a leaked draft of the most comprehensive UN study to date on the causes of climate change. Rising incomes in nations like China, India and Brazil have produced explosive demand for cars and for consumer goods that must be delivered by highway, rail, ship or air. The new pollution, measured in millions of tons of greenhouse gases, may exceed all of the savings achieved through initiatives like subsidies for public transport and fuel efficiency. Cutting back on transportation gases “will be […]

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Western powers hail Libyan oil deal

Western powers praised a deal ending blockades at eastern Libya oil export terminals, saying their closure had spoiled the nation’s economy for nine months. A joint statement by the French, German, Italian, British and U.S. governments praised Libyan Prime Minister Abdullah al-Thinni for brokering a deal to end blockades at Libyan ports. They said in their statement Monday the blockade had "done so much damage to the Libyan economy and to the Libyan people over the last nine months." The International Monetary Fund said the Libyan energy sector represents about $63 billion to the government, a majority in terms of percentage of gross domestic product. In March, a progress report on Libya from the European Commission said a blockade on oil exports by eastern federalists has "severely" affected Libya’s fiscal situation. Last weekend, the Libyan government agreed on terms with eastern rebel leaders to […]

Posted On : Published By : Tom Whipple