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Oil complex settles lower amid mixed US macro data

NYMEX crude settled 87 cents lower at $102.71/b Friday in light volume trading amid lackluster US macroeconomic data. NYMEX June product contracts both settled lower upon expiry, led by June ULSD futures, which fell 3.44 cents to end at $2.8846/gal. June RBOB fell 1.71 cents to settle at $2.9965/gal. July ULSD fell 3.17 cents to settle at $2.8882/gal, while July RBOB dropped 2.39 cents to settle at $2.9719/gal. US macroeconomic data Friday was mixed, with Chicago PMI — a key manufacturing index — beating expectations, coming in at 65.5 for May, up from 63 in April. But the Michigan Consumer Sentiment index left a little to be desired, coming in slightly higher at 81.9 in May, but missing economists expectations for a 82.5 reading. "I think that we might be seeing some macro reaction today," Oil Outlooks President Carl Larry said. "And this could be knocking gasoline and diesel […]

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Oil Mixed Following U.S. Inventory Data

Oil futures were mixed in Asian trade, with some profit-taking in U.S. crude after overnight gains thanks to a drawdown in stockpiles at Cushing, a major onshore storage hub and the physical delivery point for New York Mercantile Exchange futures. Light, sweet crude futures for delivery in July traded at $103.42 a barrel at 0534 GMT on the Nymex, down $0.16 in the Globex electronic session. They settled up 86 cents, or 0.8%, at $103.58 a barrel overnight. U.S. crude futures are likely to see little downside risk, with prices staying well above $100/bbl in the near-term due to the low stocks at Cushing, which fell 1.5 million barrels from a week ago, said Okato Shoji Co. ‘s deputy manager of research, Kaname Gokon, in Tokyo. Supplies in Cushing have fallen 16 out of the last 17 weeks and are down more than 20 million barrels since late January, […]

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Oil falls below $103, ends week down 1.6 pct

The price of oil fell below $103 per barrel Friday on ample supplies of crude and fuels. Benchmark U.S. crude for July delivery fell 87 cents to close at $102.71 a barrel in New York. The contract closed down 1.6 percent for the week, though it finished the month up nearly 3 percent. Brent crude, a benchmark for international oil used by many U.S. refineries, fell 56 cents to close at $109.41 a barrel in London. The price of crude was pulled down in part by the falling prices of wholesale gasoline and heating oil, suggesting that the U.S. has ample supplies of refined fuels. That could crimp demand for crude oil in coming weeks. Crude supplies in the U.S. are also plentiful, but crude prices were pushed higher during the month because inventories at the U.S. trading hub where benchmark crude is priced have fallen sharply. Next week […]

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WTI Caps Weekly Loss on Consumer Spending; Brent Falls

West Texas Intermediate crude capped the first weekly loss since May 2 as U.S. consumer spending fell in April and rising inventories signaled ample supply. WTI declined for the third time in four days. Household purchases, which account for about 70 percent of the economy, dropped 0.1 percent, the first decrease in a year, the Commerce Department said today. Crude stockpiles climbed 1.66 million barrels to 393 million last week, the Energy Information Administration reported yesterday. Brent slipped as Russia pulled back most of its troops from the border with Ukraine. “The economic data was not really giving us expectations that demand will be strong,” said Phil Flynn, senior market analyst at the Price Futures Group in Chicago . “Supply is pretty ample here. Russia pulled back its troops and that reduced risk premium a little bit.” WTI for July delivery slid 87 cents, or 0.8 percent, to end […]

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Oil Price Becalmed as Supply Growth Means Record Low Volatility

Oil-price volatility fell to a record amid speculation that crude-supply growth in the U.S. and spare Saudi Arabian production capacity will avoid any shortages resulting from strengthening economies. The 20-day historical volatility of Brent crude declined to 8.1 percent at 3 p.m. in London today, set to be the lowest since the contract began trading in 1988, according to data compiled by Bloomberg News. Spare capacity in Saudi Arabia and booming U.S. output of oil from shale-rock formations are preventing price surges, while stable global economic recovery and steady stimulus measures by the Federal Reserve avert a slump, BNP Paribas SA said. “It can be taken as a sign that markets are deemed to be in equilibrium, with no clear fundamental imbalances,” Olivier Jakob , managing director at consultants Petromatrix GmbH in Zug, Switzerland, said by e-mail today. Brent futures traded as low as $103.95 a barrel and as […]

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Iran wants stronger energy ties with Turkey

| License Photo Iran expects to add to the $10 billion trade relationship with Turkey through further cooperation in the energy sector, Iran’s ambassador to Ankara said. Ambassador Aliereza Bigdeli spoke Thursday on bilateral trade during a summit in Ankara. Both countries, he said, are positioned well to take advantage of transit opportunities in the European and Asian energy sectors. Iran has said its gas resources could be a benefit to a European community struggling to break Russia’s grip on the region’s energy sector, though sanctions on Iran have put many investors on the sidelines. Iranian state media reports Turkey imported $10 billion worth of goods last year and that level could double given the right trade climate. In February, Turkish Energy Minister Taner Yildiz said he’s ready to listen if Iran comes forward with new energy investment proposals, but nothing is in the works.

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Iraqi Army faces deaths and desertions

Ill-equipped soldiers struggle with Anbar offensive as militants pour in across the border from Syria and join forces with local tribesmen Iraq’s acting defence minister looks beleaguered, his face drawn, with deep bags below his eyes from a lack of sleep. For four months, Sadoun Al Dulaimi has been operating from Anbar, the most dangerous province for US soldiers during the Iraq War and one again riven by conflict. The army has dispatched 42,000 troops here in a bid to quell Al Qaida-inspired jihadists and hostile tribesmen, whose resurgence is posing the biggest test for the Iraqi military and the country’s Shiite-led government since the withdrawal of US forces two and a half years ago. The battle is filled with potential pitfalls. A government failure to regain control in Sunni-dominated Anbar would jeopardise the country’s unity. But an escalated military offensive could deepen anger among the nation’s Sunni minority, […]

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Iraq PM calls for “jihad” against Anbar jihadists

Maliki pledges to "cleanse" Anbar of ISIS by start of Ramadan Iraq’s Prime Minister Nuri Al-Maliki speaks during a news conference with UN Secretary-General Ban Ki-moon in Baghdad on January 13, 2014. (Reuters/Ahmed Saad) Baghdad, Asharq Al-Awsat —Iraqi Prime Minster Nuri Al-Maliki called for “jihad” against the Islamic State of Iraq and Syria (ISIS) in Iraq’s restive western Anbar province on Wednesday, pledging to crush the Islamist insurgency before the Muslim holy month of Ramadan that is set to be begin in late June. In his weekly speech from Baghdad, Maliki also called for a “national dialogue” on Anbar, stressing that the Iraqi people must “stand with the security forces,” and that residents of Anbar must work with “their brothers from the tribes of Anbar and the local and central governments to accelerate the cleansing of Anbar” of ISIS militants. “Everybody must unite and return to the ranks of […]

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Maliki: Elimination of Terrorists in Anbar Won’t Require Long Time

World Maliki: Elimination of Terrorists in Anbar Won’t Require Long Time TEHRAN (FNA)- Iraqi Prime Minister Nouri al-Maliki announced that the army’s campaign in Anbar will not be in need of a long time, stressing that the coming Holy month of Ramadan will witness restoring security in the restive province. The Iraqi leader also said that the local tribes are cooperating with the army to face ISIL terrorists, adding that crisis of the displaced will be ended soon, Al-Manar reported. It is worth noting that the Iraqi province of Anbar has been witnessing military clashes between the army and the terrorists of the Islamic State in Iraq and the Levant (ISIL) which has committed numerous crimes against the Iraqi military and citizens.

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Tanker with piped Iraqi Kurdish oil U-turns away from US

A crude oil tanker at the center of a dispute between Iraqi Kurdistan and Baghdad has reversed course from its route towards the United States, ship-tracking data showed on Friday, indicating that the shipper may not have a buyer. The United Leadership oil tanker has become a symbol of a wider conflict between Baghdad and Iraqi Kurdistan over oil sales from the autonomous northern enclave, as it contains the first crude to come out of the region’s newly built pipeline into Turkey. Since loading at the Turkish port of Ceyhan last week, the United Leadership set course for the U.S. Gulf Coast, according to ship-tracking and market sources. The U.S. State Department said that it did not condone oil sales bypassing Baghdad, and that any buyers could risk a legal suit with the central government. “We do not support the export or sale of oil absent the appropriate approval […]

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Libya hopeful about its oil sector

The chairman of the Libyan National Oil Corp. said the government aims to hold an auction for new oil licenses once political hurdles are cleared. Companies interested in investing in Libya, once a premier North African oil producer, have said the nation’s troubled security sector and tough contractual terms are keeping them at bay. NOC Chairman Mustafa Sanallah told potential investors at an energy conference in London another bidding round is expected once a permanent government is formed and new draft oil laws are ready. "Hopefully by next year the situation will be very clear," he said Thursday. The latest monthly market report from the Organization of Petroleum Exporting Countries, of which Libya is a member, says the North African nation produced 238,000 barrels of oil per day in April, down from the first quarter average of 364,000 bpd and well below its 2012 level of 1.4 million bpd. […]

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Prolonged Libyan Oil Closures Delay Return to Normal Output

LONDON—Prolonged closures in Libya’s oil fields are set to delay a return to normal output, a senior official said Friday—even after production at the country’s largest oil field is restarted. Speaking at the third New Libya Oil and Gas Forum in London, Anwar Agil, head of production management at Libya’s National Oil Corporation, said a return to normal production at the country’s largest oil field could be delayed by four months because more than 20 underground pumps needed to be replaced. The Sharara field, in western Libya, which is operated by Spain’s Repsol SA, is currently shut after being occupied by local protesters seeking better redistribution of oil revenue. Underground pumps there have been repeatedly switched on and off amid false starts. The field has the capacity to produce 340,000 barrels a day—more than a fifth of Libya’s normal output of about 1.5 million barrels a day. But even […]

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Obama Uses Hurricane Season Start to Boost Climate Plan

Anticipating more storms like Hurricane Sandy , President Barack Obama urged emergency workers and residents in coastal areas to brace themselves for the start of the hurricane season. The official beginning of the hurricane season two days from now coincides with an administration focus on climate change, which Obama is making a central issue during his final years in office. “The changes we’re seeing in our climate mean that, unfortunately, storms like Sandy could end up being more common and more devastating,” Obama said today at a hurricane preparation meeting at the Washington headquarters of the Federal Emergency Management Agency. “And that’s why we’re also going to be doing more to deal with the dangers of carbon pollution that help to cause this climate change and global warming.” The Environmental Protection Agency is set to announce on June 2 limits on carbon emissions from power plants . While the […]

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Cheniere signs U.S. gas export deal with Iberdrola

U.S. gas company Cheniere Energy said Friday its Spanish counterpart, Iberdrola, agreed to buy liquefied natural gas from a planned export terminal in Texas. Cheniere Energy Chairman Charif Souki said Friday deliveries of as much as 400,000 tons of liquefied natural gas from the planned Corpus Christi export facility could begin by 2019. Iberdrola, he said, "is the first foundation customer" for the export facility and more deals are on the way. "We are in advanced discussions with other counterparts and are working towards finalizing additional agreements," he said in a statement . "We expect to complete all necessary steps to reach a final investment decision and begin construction by early 2015." The deal is the third of its kind for Cheniere. The company signed a deal with Spanish energy company Endesa in April and with Indonesian state-owned company PT Pertamina in December. Iberdrola in a statement said the […]

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API: Oil exports good for most U.S. states

Even states that don’t produce much oil could benefit from the lifting of a 1970s-era export ban, a report prepared for the American Petroleum Institute says. The U.S. government restricted crude oil exports in 1973 in response to an embargo from Arab members of the Organization of Petroleum Exporting Countries. An increase in U.S. oil production has prompted groups like API to call for a repeal of the 1973 measure. Kyle Isakower, vice president of regulatory policy for API, which represents the interests of the energy industry, said exports would bring benefits to most of the 50 states. "New jobs, higher investment, and greater energy security from exports could benefit workers and consumers from Illinois to New York, especially in areas where consumer spending and manufacturing drive growth," he said in a statement Thursday. The report, prepared by ICF International and EnSys Energy, says some states without much oil […]

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Monthly Natural Gas Gross Production Report with data for March 2014

The two graphs below show total U.S. and Lower 48 natural gas production on one and the individual State production on the other. In March, production in the Lower 48 States increased by 1.6 percent or 1.18 billion cubic feet per day (Bcf/d). Texas had the largest volumetric increase at 2.6 percent or 0.57 Bcf/d primarily due to new wells being brought online and shut-in wells returning to production. Other States also reported a gain of 1.4 percent or 0.40 Bcf/d as many operators reported improved weather conditions and new wells in the Appalachian and Uinta Basins. Oklahoma production also saw an increase of 4.1 percent or 0.24 Bcf/d due to the completed maintenance and improved weather conditions from the prior month. Both the Federal Gulf of Mexico and Louisiana saw declines of 2.7 percent or 0.09 Bcf/d and 1.4 percent or 0.08 Bcf/d respectively, mainly due to maintenance […]

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US gas demand could increase by 3-10 Bcf/d under EPA GHG rule: analysts

US natural gas demand could increase by 3 Bcf/d to 10 Bcf/d by 2020 under an expected Environmental Protection Agency plan to reduce carbon dioxide emissions from power plants, analysts said Friday. Using its authority under the Clean Air Act, EPA is expected Monday to announce proposed rules designed to limit the amount of COs emitted by existing power plants. Gas will be one of the winners under every assumption about new source performance standards for existing power plants, analysts said Friday. They differed only on the size and scale of how much gas would be needed, saying that will depend entirely on how strict or lax the new regulations are on coal-fired plants. President Barack Obama’s Climate Action Plan calls for a 20% cut in carbon dioxide emission by 2020 but which year will serve as the benchmark from which to measure the cut is still unknown. There […]

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Baker Hughes: US drilling rig count rises to 1,866

The US drilling rig count gained 9 units to reach 1,866 rigs working during the week ended May 30, Baker Hughes Inc. reported. All 9 of those units were land-based rigs, bringing its total to 1,792. Rigs drilling offshore and in inland waters were unchanged from a week ago at respective totals of 60 and 14. Oil rigs rose 8 units to 1,539 while gas rigs edged up a single unit to 326. Rigs considered unclassified were unchanged from a week ago at 4. Horizontal drilling rigs jumped 8 units to 1,251. Directional drilling rigs climbed 7 units to 212. In Canada, a 44-unit leap brought the nation’s total to 198, 53 units higher than this week a year ago. A vast majority of those units were oil rigs, which spiked 40 units to 105. Gas rigs, meanwhile, merely gained 4 units to 93. Major states, basins Oklahoma’s […]

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$4 gas fuels shock and awful words

Four-dollar gasoline has made an unwelcome and unexpected return. Prices of regular, unleaded rose to within a penny or two of $4 per gallon yesterday across central Ohio, according to GasBuddy.com, with a few retailers hitting the $4 mark. Analysts say the increase is because of a national surge in demand that is hitting the state particularly hard. This is in contrast to reports earlier this month that prices likely had peaked. “There is strong demand, and supply is not as robust as needed,” said Brian Milne, an editor at Schneider Electric, a service provider to the energy industry. “That’s a market signal to produce more supply and bring more supply to the area.” Ohio gets much of its fuel from a wholesale market in the Chicago area, which has seen an unusually large price increase. The current wholesale price is the highest since July, Milne said. Central Ohio’s […]

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EIA: Russian gas pipeline exports to Western Europe up 20%

In 2013, Russia’s natural gas pipeline exports to Eastern and Western Europe averaged 15.6 bcfd, a 16% rise compared with 2012, according to data from the US Energy Information Administration, Eastern Bloc Research, and Russian Energy Monthly. The increase was mainly driven by exports to Western Europe, which rose by 20% to 12.3 bcfd. “The entire increase in Russian natural gas exports to Western Europe in 2013 occurred in three countries—Italy, Germany, and the UK,” EIA said. Italy had the largest increase in gas pipeline imports from Russia in 2013, receiving 2.4 bcfd and reflecting a 1 bcfd increase over 2012. Germany and the UK’s imports from Russia increased in 2013 to 3.9 bcfd and 1.2 bcfd, respectively, 0.7 bcfd and 0.4 bcfd more than in 2012. Italy can receive Russian gas on the Bratstvo (Brotherhood) and Soyuz (Union) pipelines, which pass through Ukraine. Germany can receive Russian […]

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Canada’s high-cost oil and gas needs a competitive game plan

Canadian oil and gas companies will be competing head to head with lower-cost energy producers in the near future, and the country needs a better strategy to remain competitive in a post peak-oil world. According to a PwC report released May 30, Canada has four options when it comes to the future of oil and gas: continue relying on exports to the United States ; focus on building pipelines to either the west or east coasts to get oil and gas to offshore markets; or look to develop “unconventional resources” in Canada’s north. “As Canada moves from a focus on the US market toward exporting our oil production to world markets, it will fight for market share with nations that have strategic interests and the regulatory will to capture demand, particularly in the high-growth Asian market,” says the report. While Canada still has some of the largest oil reserves […]

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Total Joslyn Oil-Sands Project Delayed, Jobs Cut on Costs

Total SA (FP) will cut 150 jobs at its Joslyn oil-sands project in Canada and delay a final investment decision as costs escalate and the company and partner Suncor Energy Inc. (SU) look for ways to make the project more profitable. “We just need to find ways to go further in cost effectiveness,” Andre Goffart, the president of Total’s Canadian business, said on a conference call yesterday. Oil-sands mining projects including the C$11 billion ($10.1 billion) Joslyn venture are “very capital intensive projects.” Oil-sands miners have struggled with rising costs in northern Alberta because of labor shortages and distance from equipment suppliers. Imperial Oil Ltd. (IMO) , the Calgary-based producer majority owned by Exxon Mobil Corp., last year boosted the cost of its Kearl project by 18 percent. The decision on Joslyn will save Total, France ’s largest oil producer, $3.9 billion in the next four years, Oswald Clint […]

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Ukraine to challenge Gazprom

| License Photo The drafting of a lawsuit against Russian energy company Gazprom is in the final stages, Ukrainian Justice Minister Pavlo Petronko said. Ukraine has a Friday deadline to settle a debt the Russian energy company says is for $2 billion. No payment means no gas deliveries to Ukraine starting in June, Gazprom officials said. The deadline coincides with a second round of trilateral energy talks between Ukrainian, Russian and European officials. Under a proposal , Ukraine would settle its debt and offer another $500 million by June 7. Ahead of the Friday talks in Berlin, Petronko said Ukrainian energy company Naftogaz sent a pre-arbitration statement to Gazprom in a challenge to its contractual relationship. "The drafting of the lawsuit is in the final stage," he said in an interview broadcast Thursday with RBC-Ukraine. Gazprom said Ukraine may have to pay in advance for natural gas if a […]

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Fracking plans submitted for British shale

British shale explorer Cuadrilla Resources, the target of heated protests, said it submitted plans for new fracking operations to Lancashire County officials. "The proposal covers the works required to drill, hydraulically fracture and test the flow of gas from up to four exploration wells on the site," the company said in a statement Thursday. When the company announced its intent to submit plans to Lancashire officials in early May, Caudrilla CEO Francis Egan said the application would be an "important milestone" for British shale. In March, the company said it believes there are 200 trillion cubic feet of shale natural gas in the Bowland basin in Lancashire. The company was the target of major demonstrations last summer when exploratory operations in the southern village of Balcombe were viewed as a prelude to fracking, though the process wasn’t carried out at the site. Caudrilla said Thursday there […]

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Three Necessary Strategies Mitigating Peak Oil

“First is conservation. That’s the missing piece in most proposals for dealing with peak oil. The chasm into which so many well-intentioned projects have tumbled over the last decade is that nothing available to us can support the raw extravagance of energy and resource consumption we’re used to, once cheap abundant fossil fuels aren’t there any more, so—ahem—we have to use less. Too much talk about using less in recent years, though, has been limited to urging energy and resource abstinence as a badge of moral purity, and—well, let’s just say that abstinence education did about as much good there as it does in any other context. The things that played the largest role in hammering down US energy consumption in the 1970s energy crisis were unromantic but effective techniques such as insulation, weatherstripping, and the like, all of which allow a smaller amount of energy to do the […]

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Converging Energy Crises – And How our Current Situation Differs from the Past

At the Age of Limits Conference , I gave a talk called Converging Crises  (PDF), talking about the crises facing us as we reach energy limits. In this post, I discuss some highlights from a fairly long talk. A related topic is how our current situation is different from past collapses. John Michael Greer talked about prior collapses, but because both of our talks were late in the conference and because I was leaving to catch a plane, we never had a chance to discuss how “this time is different.” To fill this gap, I have included some comments on this subject at the end of this post. The Nature of our Current Crisis The first three crises are the basic ones: population growth, resource depletion, and environmental degradation. The other crises are not as basic, but still may act to bring the system down. Humans have found a series […]

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Oil Mixed Following U.S. Inventory Data

Oil futures were mixed in Asian trade, with some profit-taking in U.S. crude after overnight gains thanks to a drawdown in stockpiles at Cushing, a major onshore storage hub and the physical delivery point for New York Mercantile Exchange futures. Light, sweet crude futures for delivery in July traded at $103.42 a barrel at 0534 GMT on the Nymex, down $0.16 in the Globex electronic session. They settled up 86 cents, or 0.8%, at $103.58 a barrel overnight. U.S. crude futures are likely to see little downside risk, with prices staying well above $100/bbl in the near-term due to the low stocks at Cushing, which fell 1.5 million barrels from a week ago, said Okato Shoji Co. ‘s deputy manager of research, Kaname Gokon, in Tokyo. Supplies in Cushing have fallen 16 out of the last 17 weeks and are down more than 20 million barrels since late January, […]

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WTI Set for Monthly Gain as Cushing Supplies Decline

West Texas Intermediate headed for its first monthly advance since February as crude inventories shrank at the delivery point for New York contracts. Brent was steady in London, poised for a second monthly gain amid separatist violence in Ukraine. Futures were little changed after rising 0.8 percent yesterday. Stockpiles at Cushing, Oklahoma , the biggest U.S. oil-storage hub, dropped by 1.53 million barrels last week to the lowest level since November 2008, according to the Energy Information Administration. Supplies nationwide expanded by 1.66 million, compared with a 500,000 barrel gain estimated in a Bloomberg News survey . “Cushing is certainly a factor” supporting front-month WTI prices, Tony Machacek, a broker at Jefferies Bache Ltd. in London, said by e-mail. “Total stocks are high, so there shouldn’t be any strong fundamental reason for prices to move too much higher.” WTI for July delivery was at $103.20 a barrel in electronic […]

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Natural Gas Slips as Supplies Grow More Than Expected

Natural gas slipped Thursday as a larger-than-expected supply increase put inventories on track to replenish by next winter. Natural gas for July delivery settled down 5.6 cents, or 1.2%, at $4.559 a million British thermal units on the New York Mercantile Exchange. Producers added 114 billion cubic feet of gas to storage in the week ended May 23, according to the U.S. Energy Information Administration. The average forecast was for an addition of 110 bcf in a Wall Street Journal survey. Natural-gas inventories shrank significantly this past winter, as frigid weather across much of the country led to record demand for gas-fueled indoor heating. This week’s injection, the largest one-week gain since June 2009, puts stocks on pace to close the deficit by the coming winter. The number "caught everybody off guard a little bit," said Frank Clements, co-owner of Meridian Energy Brokers Inc. Last […]

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OPEC May Crude Output Advances From Three-Year Low in Survey

OPEC crude production climbed in May for the first time in three months, led by gains in Angola and Saudi Arabia, a Bloomberg survey showed. Output from the 12-member Organization of Petroleum Exporting Countries rose by 75,000 barrels a day to an average 29.988 million, according to the survey of oil companies , producers and analysts. Last month’s total was revised 50,000 barrels a day higher to 29.913 million because of changes to the Saudi Arabian and United Arab Emirates estimates. Members increased production as the International Energy Agency projected further increases will be needed to meet demand during the second half of the year. The IEA said in a May 15 report that OPEC will need to provide an average of 30.7 million barrels a day in the last six months of 2014. “There’s still room for OPEC production to increase further,” said Sarah Emerson , managing principal […]

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Dozens dead as car bombs rock Baghdad and Mosul

Baghdad Attacks across Iraq, including a spate of car bombs in Baghdad and the northern city of Mosul, killed 63 people yesterday in the bloodiest violence to hit Iraq since April elections. The worst of the blasts went off during the evening and left dozens of people wounded, fuelling fears a protracted surge in violence is pushing Iraq back into the brutal communal conflict that left tens of thousands dead in 2006 and 2007. Separate deadly sets of car bombs hit both the Iraqi capital and Mosul, in the north, in the evening. In Baghdad’s deadliest attack, a suicide car bomb exploded in the mainly Shia neighbourhood of Kadhimiyah in north Baghdad, killing at least 16 people […]

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At least 54 killed in Iraqi violence

Violence rocked Iraq on Wednesday as at least 54 people died in car bombings, suicide attacks and assassinations around the country. The bloodshed hit mostly Shi’ite sections of Baghdad and the troubled northern city of Mosul, where an al Qaeda breakaway faction, the Islamic State of Iraq and the Levant (ISIL), holds sway. The bombings and killings were a reminder in the month since national elections were held that the pace of bloodshed has shown no signs of diminishing In one attack in Baghdad’s Sadr City, a minivan pulled into a line of taxis and the driver abandoned the vehicle minutes before it exploded, police said. Four people were killed and 14 were wounded, police and medical sources said. “People started shouting, ‘Where is the driver?’,” a witness said, describing the minutes before the blast. The witness spoke on condition of anonymity. Another 22 people died […]

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"Will continue exporting oil, not yielding to Baghdad", Kurdish spokesman

Kurdish spokesman Sifin Muhsen Di’za’i announced today that the Kurdish region will continue exporting oil and will benefit from the revenues to provide the salaries of the Kurdish officials. He confirmed in a statement today, copy received by Aswat al-Iraq, that the Kurdish region will not yield to Baghdad. Di’za’i re-iterated that the Kurdish region is continuing peaceful dialogue to find a solution to this problem with Baghdad. He added that the Kurdish region needs to export 400-500 thousand b/d to meet its necessary needs, but confirmed that it will not be easy. Di’za’i disclosed that the last visit of Kurdish Premier Njirvan Barzani to European counties was to get some loans to pay governmental salaries. The selling of the Kurdish oil stirred again the differences between Baghdad and Arbil. Number of Reads: 990

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“Will continue exporting oil, not yielding to Baghdad”, Kurdish spokesman

Kurdish spokesman Sifin Muhsen Di’za’i announced today that the Kurdish region will continue exporting oil and will benefit from the revenues to provide the salaries of the Kurdish officials. He confirmed in a statement today, copy received by Aswat al-Iraq, that the Kurdish region will not yield to Baghdad. Di’za’i re-iterated that the Kurdish region is continuing peaceful dialogue to find a solution to this problem with Baghdad. He added that the Kurdish region needs to export 400-500 thousand b/d to meet its necessary needs, but confirmed that it will not be easy. Di’za’i disclosed that the last visit of Kurdish Premier Njirvan Barzani to European counties was to get some loans to pay governmental salaries. The selling of the Kurdish oil stirred again the differences between Baghdad and Arbil. Number of Reads: 990

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Oil-Tinged Graft Scandal Roils Mexico

Over the past decade, Amado Yáñez Osuna gained a reputation throughout Mexico as a highflying CEO with good political ties. He turned up at events with prominent ruling-party members, and lent his private jet to party officials. But then the party lost power. On Thursday, officials arrested Mr. Yáñez and charged him with violating banking laws. Authorities say his company, oil services firm Oceanografía, defrauded Banamex, the Mexican unit of U.S. banking giant Citigroup , of about $400 million. Citigroup has already fired 12 employees in Mexico for failing to detect the alleged fraud, which was tied to alleged fake documents from state-owned oil firm Petróleos Mexicanos, or Pemex. The arrest deepens a scandal that has sent shock waves across Mexico’s political landscape. That […]

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Mexico's energy ministry projects rapid near-term growth of natural gas imports from U.S.

Source: Mexican national energy ministry SENER, 2013 natural gas market prospectus Note: All pipeline imports are from the United States. Gross imports equal net imports beginning in 2013. Logistical pipeline imports are imports from the United States to regions of northern Mexico that have no access to any other sources of natural gas. PGPB is the natural gas subsidiary of national oil company Pemex. A combination of higher natural gas demand from Mexico’s industrial and electric power sectors and increased U.S. natural gas production has resulted in a doubling of U.S. pipeline exports of natural gas to Mexico between 2009 and 2013. Mexico’s national energy ministry, SENER, projects that U.S. pipeline exports to Mexico will reach 3.8 billion cubic feet per day (Bcf/d) in 2018. This would be more than double U.S. pipeline exports to Mexico in 2013, which averaged 1.8 Bcf/d . This projected growth is driven mainly […]

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Mexico’s energy ministry projects rapid near-term growth of natural gas imports from U.S.

Source: Mexican national energy ministry SENER, 2013 natural gas market prospectus Note: All pipeline imports are from the United States. Gross imports equal net imports beginning in 2013. Logistical pipeline imports are imports from the United States to regions of northern Mexico that have no access to any other sources of natural gas. PGPB is the natural gas subsidiary of national oil company Pemex. A combination of higher natural gas demand from Mexico’s industrial and electric power sectors and increased U.S. natural gas production has resulted in a doubling of U.S. pipeline exports of natural gas to Mexico between 2009 and 2013. Mexico’s national energy ministry, SENER, projects that U.S. pipeline exports to Mexico will reach 3.8 billion cubic feet per day (Bcf/d) in 2018. This would be more than double U.S. pipeline exports to Mexico in 2013, which averaged 1.8 Bcf/d . This projected growth is driven mainly […]

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Shell signs 20-year LNG deal with Japan

The third largest electric company in Japan, Chubu Electric Power Co., will start receiving liquefied natural gas under a 20-year deal, Shell said Thursday. "Shell has a long history of supplying natural gas to Japan, and this agreement demonstrates our continued commitment to the country," Maarten Wetselaar, executive vice president for Shell’s integrated gas, said in a statement Thursday. Shell’s first LNG sales agreement with Chubu, made through the Dutch company’s Singapore-based subsidiary Shell Eastern Trading Ltd., calls for up to 12 deliveries a year, or about 720,000 tons, starting in October. Shell didn’t say from where the LNG would be sourced specifically. Japan, the second-largest importer of fossil fuels in the world, starting taking on more LNG in response to the shortage of power brought on by the meltdown at the Fukushima Daiichi nuclear power plant in 2011. With 50 years in the LNG business, Wetselaar said, Shell […]

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US Individual States Production, Bakken Area and GOM

The EIA’s Petroleum Supply Monthly  has been published with production data for all individual states and offshore areas.  All data is Crude + Condensate and in thousand barrels per day with the last data point March 2014. Since the Bakken occupies part of two states, North Dakota and Montana, I have combined their production in order to get a better idea of what is really happening there. I have drawn a trend line from July 2011 through October 2012. That shows where production might have been if the fast decline rate and bad weather had not caught up with the. Production was 1,050,000 barrels per day in March, still 5,000 barrels per day below the point reached in November. I wanted to show this chart so we could get a better idea what is really going on in the entire Bakken area. Back in May and June of 2012 […]

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A Price Tag on Carbon as a Climate Rescue Plan

Bryan T. Pagel, a dairy farmer, watched as a glistening slurry of cow manure disappeared down a culvert. If recycling the waste on his family’s farm would help to save the world, he was happy to go along. But back, machinery was breaking down the manure and capturing a byproduct called methane, a potent greenhouse gas. A huge Caterpillar engine roared as it burned the methane to generate electricity, keeping it out of the atmosphere.

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Railcar Shortage in U.S. Pushes Up Lease Rates

Safety regulations on tank cars will likely keep demand strong. Monthly rates for tank cars have increased. Bloomberg News A shortage of railcars bedeviling farmers, auto makers and oil drillers has become a windfall for some railcar manufacturers, lessors and finance companies. "There’s strong demand for a broad base of car types and there’s not enough inventory," said David Nahass, senior vice president at Railroad Financial Corp., a Chicago-based investment adviser. "As an operator or lessor in this environment, this is what you pray for." Monthly rates for tank cars, which transport liquids such as crude oil, have increased to $1,500 to $2,000 a car from about $500 in early 2011, before hydraulic fracturing ramped up in North Dakota’s Bakken Shale oil field. Cars that haul sand for fracking are leasing for about $650 a month, up nearly 50% from the end of last year, according to leasing-industry analysts. […]

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EPA's Carbon Rule to Spark Lawsuits

The expected legal battle over the Obama administration’s coming limits on carbon emissions from existing power plants could provide a rarity for environmental litigation: a case for which there is scant court precedent. The Environmental Protection Agency is turning to a little-used provision of the Clean Air Act for its new rules, because carbon dioxide isn’t regulated under major programs that address air pollutants. The EPA says it has only used the section, called 111(d), to regulate five sources of pollutants since it was enacted in 1970—and none on the scale of CO2, a major greenhouse gas. Because the provision has been invoked so rarely, courts have had little opportunity to weigh in on it, creating the unusual circumstance in which potential challengers to the carbon rules would be litigating largely on a blank slate against the EPA. The Clean Air Act provision gives the agency authority to regulate […]

Posted On : Published By : Tom Whipple
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EPA’s Carbon Rule to Spark Lawsuits

The expected legal battle over the Obama administration’s coming limits on carbon emissions from existing power plants could provide a rarity for environmental litigation: a case for which there is scant court precedent. The Environmental Protection Agency is turning to a little-used provision of the Clean Air Act for its new rules, because carbon dioxide isn’t regulated under major programs that address air pollutants. The EPA says it has only used the section, called 111(d), to regulate five sources of pollutants since it was enacted in 1970—and none on the scale of CO2, a major greenhouse gas. Because the provision has been invoked so rarely, courts have had little opportunity to weigh in on it, creating the unusual circumstance in which potential challengers to the carbon rules would be litigating largely on a blank slate against the EPA. The Clean Air Act provision gives the agency authority to regulate […]

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Total Unit to Halt Work on Alberta Oil-Sands Project

The Canadian unit of France’s Total SA said Thursday it will halt its nearly decadelong development of a major oil sands project and lay off at least 100 local staff, a move that highlights the challenges of multibillion-dollar investments in unconventional sources of crude oil. A final investment decision on the roughly nine billion Canadian dollar (US$8.3 billion) project in northern Alberta, known as Joslyn North, has been pushed back indefinitely, the company said. Total received approval from the provincial government in 2011 and had envisioned starting production at the 157,000-barrel-a-day open-pit surface mine by 2020, according to recent filings. "Joslyn is facing the same challenge that most of the industry world-wide [faces]," Total E&P Canada President André Goffart told reporters on a conference call. ""The costs are continuing to inflate when the oil price—and specifically the netbacks for the oil sands—are remaining stable at best, thus squeezing […]

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U.S. Crude Oil Production Forecast-Analysis of Crude Types

U.S. oil production has grown rapidly in recent years. U.S. Energy Information Administration (EIA) data, which reflect combined production of crude oil and lease condensate, show a rise from 5.7 million barrels per day (bbl/d) in 2011 to 7.4 million bbl/d in 2013. EIA’s Short-Term Energy Outlook (STEO) projects continuing rapid production growth in 2014 and 2015, with forecast production in 2015 reaching 9.2 million bbl/d. Beyond 2015, EIA’s Annual Energy Outlook (AEO) projects further production growth, although its pace and duration remain uncertain. Domestic production plateaus near 9.6 million bbl/d between 2017 and 2020, close to its historical high of 9.6 million bbl/d in 1970, in the AEO2014 Reference case. In the AEO2014 High Oil and Gas Resource case, growth continues through the 2020s and into the 2030s, with production reaching 13.3 million barrels per day in 2036. Recent and forecast increases in domestic crude […]

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U.S. Gulf cornerstone of energy policy, secretary says

The U.S. energy portfolio continues to count on the Gulf of Mexico as a "critical component," visiting U.S. Deputy Interior Secretary Mike Connor said. Connor spent two days in New Orleans visiting oil and gas production facilities in the region as part of the government’s quadrennial energy review. The energy review, established in January, is aimed at developing a multiyear roadmap for federal energy policy. "The Gulf of Mexico is a critical component of our nation’s domestic energy portfolio, and we are committed to working with industry, state officials and local communities to improve and safeguard the infrastructure that supports the region’s production and distribution systems," Connor said in a statement Wednesday. Last month, the Bureau of Ocean Energy Management announced plans to sell more than 21 million acres off the coast of Texas to energy exploration companies in August. The blocks up for auction are […]

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U.S. gas imports declining steadily

The amount of natural gas imported into the U.S. market dropped 14 percent last year in part because of abundant domestic resources, the Energy Department said. The Energy Information Administration, the statistical arm of the Energy Department, said natural gas production in 2013 hit 24.2 trillion cubic feet, which would be a new record if preliminary data are correct. EIA said in its report net imports declined in part as a response to increases in domestic production. The level of natural gas imports have declined every year since 2007, the report said, and is at its lowest level since 1989. In a separate monthly report , EIA said the United States imported 542 billion cubic feet of natural gas for the first two months of 2014, which is actually 5 percent more than the same period last year. Total natural gas exports for the two-month period […]

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Conventional wisdom on U.S. oil exports wrong, report says

| License Photo A report Thursday from global consulting group IHS finds U.S. gasoline prices could decline if a 1970s era ban on crude oil exports is lifted. IHS said reversing legislation enacted after the Arab oil embargo in the 1970s would lead to an increase in oil production from the current level of 8.2 million barrels per day to 11.2 million barrels per day, which it says would translate to lower domestic retail gasoline prices. The report said more crude oil on the international market would lower global prices, which would be to the benefit of U.S. consumers. "The assumption that allowing crude oil exports would result in higher gasoline prices for consumers is not accurate," the report said. The report from IHS mirrors a March report prepared for the American Petroleum Institute, the industry’s lobbying group. In January, Graeme Burnett, a senior vice president from Delta Air […]

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Lifting of Crude Export Ban Will Spur U.S. Economy, IHS Says

The U.S. will benefit from increased oil production and lower gasoline prices if the government lifts restrictions on crude exports, according to IHS Inc. (IHS) The world’s largest oil consumer may save an average of $67 billion a year from its import bill as domestic output may rise as much as 949,000 barrels a day in 2016 with the removal of the export ban, the Colorado-based consultant said in a report today. Such a scenario would support 964,000 additional jobs in 2018, it predicted. “Making U.S. oil available to global markets would unlock the current supply and refining gridlock,” IHS said. “It would lead to a total of $746 billion in additional investment during the study period of 2016 to 2030 and an average of 1.2 million barrels per day more oil production per year.” A 1975 U.S. federal law bans most oil exports, with only shipments of refined […]

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Are Shales A Bubble?

Hype works. Particularly when monetary and economic benefits are promised. Hype has been the primary tool used by the oil and gas industry with regard to shales and it has worked brilliantly. There is just one problem. When considering shale economic viability, hype was the only aspect that actually existed. Interestingly, the past year has brought massive write downs in shale assets and a frenzy of asset sales. Some companies, such as Shell, admitted that their divestment of North American shale properties was to stem the financial hemorrhaging and to distance themselves from disappointing well results. Others, like Exxon Mobil, claim to still be true believers in spite of their losses. According to a Bloomberg article dated May, 2014: “The recent battering of Forest Oil (FST) shows how the borrow-drill strategy can backfire. Forest generated $1.3 billion by selling assets in […]

Posted On : Published By : Tom Whipple