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Highlights of the latest OMR

il prices rose marginally month-on-month in April, supported by continued tensions between Russia and the Ukraine, supply outages in OPEC and non-OPEC countries and stepped up crude buying as refiners complete seasonal turnarounds. ICE Brent futures were last trading at $109.85/bbl and NYMEX WTI at $102.10/bbl. Forecast global demand growth for 2014 has been raised marginally since last month’s Report , to 1.32 mb/d, on higher 1Q14 data. Baseline adjustments to 2012 add 0.1 mb/d to the historical average and total demand, now pegged at 92.8 mb/d in 2014.  Global supplies rose 700 kb/d month-on-month to 92.1 mb/d in April, with roughly half of […]

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"No tangible progress" made in Iranian nuclear talks: Iranian deputy FM

he forth round of Iranian nuclear talks ended Friday in Vienna, making "no tangible progress," but the negotiation will continue in coming months, Iran’s chief nuclear negotiator was quoted as saying. Abbas Araqchi, who is also Iranian deputy foreign minister, on Friday made the remarks after a 3-day meeting with five permanent members of the UN Security Council (China, France, Russia, the UK and the United States) and Germany in Vienna. Araqchi believes "drafting" could be started "when the positions are closer to each other," without providing further details of the talks. Before the talks, U.S. and Iranian officials said the talk could be "very difficult" as the significant gap between Tehran and west remains. Western states suspect Iran has been developing atomic weapon undercover of its civilian nuclear plan, while Iran dismisses the allegation, saying its nuclear program is solely peaceful and the […]

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“No tangible progress” made in Iranian nuclear talks: Iranian deputy FM

he forth round of Iranian nuclear talks ended Friday in Vienna, making "no tangible progress," but the negotiation will continue in coming months, Iran’s chief nuclear negotiator was quoted as saying. Abbas Araqchi, who is also Iranian deputy foreign minister, on Friday made the remarks after a 3-day meeting with five permanent members of the UN Security Council (China, France, Russia, the UK and the United States) and Germany in Vienna. Araqchi believes "drafting" could be started "when the positions are closer to each other," without providing further details of the talks. Before the talks, U.S. and Iranian officials said the talk could be "very difficult" as the significant gap between Tehran and west remains. Western states suspect Iran has been developing atomic weapon undercover of its civilian nuclear plan, while Iran dismisses the allegation, saying its nuclear program is solely peaceful and the […]

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Iran Nuclear Talks Stumble in Latest Round on Enrichment

Diplomats negotiating over Iran ’s atomic program ended the latest round of talks in Vienna without advancing their bid to reach a deal by July to impose nuclear curbs in exchange for a lifting of sanctions. The sides will meet twice next month in the Austrian capital to try to hammer out an accord, Iran’s Deputy Foreign Minister Abbas Araghchi said. “There was no tangible progress in this round, but the trend of negotiations was good,” Araghchi said at a briefing broadcast by Press TV. “No drafting will be done until both sides have reached a mutual viewpoint.” A U.S. official, who asked not to be identified because the information isn’t public, said the latest talks were difficult and Iranian negotiators should be aware that more urgency will be needed to meet their July deadline. Diplomats at this week’s meeting were expected to begin drafting the text of a […]

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Nuclear Talks With Iran Fail to Yield Pact, Officials Say

The latest round of nuclear talks between Iran and six world powers ended on Friday in Vienna, with Iranian and American officials saying that progress was slow and difficult, with serious gaps between the two sides on basic issues like the size of any nuclear enrichment capability Iran would be permitted to retain. A senior American official, speaking on the condition of anonymity to discuss diplomatic negotiations, said that Iran needed to be more realistic in the talks. Iran’s deputy foreign minister, Abbas Araghchi, told Iranian news media that “there was no tangible progress in this round of the talks” and that differences were too large to begin drafting an accord. But he said that the talks would continue next month. The American official agreed with Mr. Araghchi that “significant gaps” remained after three days of talks. “Iran still has to make some hard choices,” the official […]

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U.S. warns 'time is short' as Iran nuclear talks make little progress

Iran and six world powers made little progress this week in talks on ending their dispute over Tehran’s nuclear program, U.S. and Iranian officials said on Friday, raising doubts over the prospects for a breakthrough by a July 20 deadline. After three months of mostly comparing expectations rather than negotiating compromises, the sides had intended to start drafting a final agreement that could end more than a decade of enmity and mistrust and dispel fears of a wider Middle East war. "We believe there needs to be some additional realism," a senior U.S. official said on condition of anonymity, declining to provide details on what issues had caused the most difficulty. "Time is not unlimited here." "In any negotiation there are good days and bad days, there are ups and downs, this has been a moment of great difficulty but one that was not entirely unexpected," […]

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U.S. warns ‘time is short’ as Iran nuclear talks make little progress

Iran and six world powers made little progress this week in talks on ending their dispute over Tehran’s nuclear program, U.S. and Iranian officials said on Friday, raising doubts over the prospects for a breakthrough by a July 20 deadline. After three months of mostly comparing expectations rather than negotiating compromises, the sides had intended to start drafting a final agreement that could end more than a decade of enmity and mistrust and dispel fears of a wider Middle East war. "We believe there needs to be some additional realism," a senior U.S. official said on condition of anonymity, declining to provide details on what issues had caused the most difficulty. "Time is not unlimited here." "In any negotiation there are good days and bad days, there are ups and downs, this has been a moment of great difficulty but one that was not entirely unexpected," […]

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Israel, U.S. import disputed oil from Iraqi Kurdistan

Israeli and U.S. oil refinerieshave joined the growing list of customers for crude from IraqiKurdistan, a region locked in a bitter struggle with the centralgovernment in Baghdad that says the sales are illegal. The United States imported its first crude cargo from theregion two weeks ago while at least four have gone to Israelsince January, ship tracking and industry sources said, aftertwo were shipped there last summer. The Iraqi government has repeatedly said oil salesby-passing Baghdad are illegal and has threatened to sue anycompany involved in the trade, yet Kurdish crude and lightcondensate oil has been sold to several European buyers. Baghdadrefuses to sell oil to Israel, echoing other Arab states. Israel’s Energy […]

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Kurdistan Rejects Report on Oil Sales to Israel, US

Kurdish officials rejected on Thursday a report by Reuters that the Kurdistan Region had sold shipments of oil to Israel and the US. “Those places mentioned in (Reuter’s) report have not been sold even a drop of oil,” said an official source from KRG’s Ministry of Natural Resources (MNR). Reuter wrote that Kurdish oil has been sold via the Turkish Powertrans to Israel’s Oil Refineries Limited’s (ORL) and that some oil shipments had reached refineries in Houston, Texas. “The United States imported its first crude cargo from the region two weeks ago while at least four have gone to Israel since January, ship tracking and industry sources said, after two were shipped there last summer.” Reuters reported. The report also mentioned that Kurdish natural gas condensate has been sold to Italy, France, Germany, the Netherlands and Latin America. “Kurdistan oil has not been sold until now,” KRG […]

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Iraq: Maliki calls on army and police to continue efforts in Anbar

Iraqi Prime Minister Nuri Al-Maliki has called on the security forces to stand firm in battles with militants in Anbar, amid criticism of the government’s handling of the crisis in Iraq’s largest province. In his weekly address on Wednesday, Maliki said soldiers and police should ignore “disorderly voices” in the fighting to reclaim the city of Fallujah, which the government has been attempting to recapture from insurgents for five months. Those “voices” appeared to include members of the Al-Qaeda-inspired Islamic State of Iraq and Syria (ISIS). Maliki said: “There should not be any consideration given to the terrorists under any pretext,” and called for the “punishment of those who covered up, cooperated with or remained silent about this phenomenon . . . Laws must be complemented with maximum levels of resolve and force in the face of Al-Qaeda.” Maliki’s opponents in the Iraqi parliament have kept up their criticism […]

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Key Figure in Libya’s Revolution Leads Attack on Islamists

A former general who was a central figure in Libya ’s revolution led a full-scale ground and air assault on several Islamist militia bases in and around the city of Benghazi on Friday, declaring war against the groups that have been accused of conducting a campaign of lawlessness and assassinations. Two dozen people were reported killed in the fighting and dozens more wounded, according to news agencies. The former general, Khalifa Heftar , seemed to be acting on his own initiative, but gained support from members of the army in eastern Libya. A column of personnel and armored vehicles moved against three militia bases around the city early Friday. Jet fighters from the Benghazi air base flew low over the city and helicopters fired on at least one militia position. Libya’s caretaker prime minister, Abdullah al-Thinni, went on television to deny that the attack had been […]

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Libya closes Benghazi airport due to fighting – director

Libyan authorities closed the airport in the eastern city of Benghazi on Friday because of fighting between irregular forces of the self-declared Libyan National Army and Islamist militants, the airport’s director said. "We have closed the airport for the safety of passengers as there were clashes in the city. The airport will be reopened depending on the security situation," Ibrahim Farkash, director of Benghazi’s Benina airport, told Reuters. (Reporting by Ahmed Elumami and Ayman al-Warfalli; Editing by Mark Trevelyan )

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Petrobras sets daily production record in Brazil’s offshore presalt

Petroleo Brasileiro SA (Petrobras) has surpassed 470,000 b/d in the presalt layer of the Santos and Campos basins offshore Brazil, a new daily production record according to the company. The milestone was reached with production from 24 wells, including 7-LL-22D-RJS, which was brought on stream on May 9 and is now contributing 31,000 b/d. Petrobras attributes a portion of its success in the Santos and Campos presalt to the use of a buoyancy supported riser (BSR) that connects 7-LL-22D-RJS to the Cidade de Paraty floating production, storage, and offloading vessel in Lula field. This ascending production pipeline is suspended from a submerged buoy and has led to above-average production from the new well and two other wells that attach to the Cidade de Sao Paulo FPSO via BSRs in Sapinhoa field, the company said. Petrobras expects to connect several new wells to both FPSOs with BSRs by this year’s […]

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Argentine Provinces Said to Unite Against YPF License Bid

The three provinces holding Argentina’s largest shale oil and gas deposits will jointly challenge a push by federally owned YPF SA (YPF) to take control of the auction and renewal of licenses, three officials said. Jorge Sapag, Francisco Perez and Martin Buzzi — governors of Neuquen, Mendoza and Chubut, respectively — met in Buenos Aires on May 13 and agreed to impel their congressional representatives to oppose any move to federalize licensing processes, the provincial officials briefed on the matter said. They asked not to be identified because the talks were private. The three governors weren’t available to comment, their assistants said by telephone. Alejandro Di Lazzaro, a YPF spokesman in Buenos Aires, declined to comment. The fight underscores political tensions derived from unclear rules governing Argentina’s nascent shale boom. For prospective license holders, a single federal system would remove the need to negotiate with two levels of government. […]

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Cars Drive China's Oil Demand as Industry Slows

Rising incomes in China are offsetting the impact of its industrial deceleration and propping up global oil prices. China is using more gasoline, which is making up for its declining demand for diesel used in industry and the trucking sector. The increase is being driven by a growing consumer class with higher disposable incomes, which is translating into more car ownership. That, in turn, has helped underpin Chinese oil demand and has kept the country on track to overtake the U.S. this year and become the No. 1 oil importer. Chinese imports of crude oil, more than half of which are used to make gasoline and diesel, are an important element of support for oil prices as the U.S. relies more on domestic shale oil. China’s January-April crude imports increased 11.5% on a year-to-year basis, with April imports soaring 21% to a record 6.8 million barrels a day. Over […]

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Cars Drive China’s Oil Demand as Industry Slows

Rising incomes in China are offsetting the impact of its industrial deceleration and propping up global oil prices. China is using more gasoline, which is making up for its declining demand for diesel used in industry and the trucking sector. The increase is being driven by a growing consumer class with higher disposable incomes, which is translating into more car ownership. That, in turn, has helped underpin Chinese oil demand and has kept the country on track to overtake the U.S. this year and become the No. 1 oil importer. Chinese imports of crude oil, more than half of which are used to make gasoline and diesel, are an important element of support for oil prices as the U.S. relies more on domestic shale oil. China’s January-April crude imports increased 11.5% on a year-to-year basis, with April imports soaring 21% to a record 6.8 million barrels a day. Over […]

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White House Says China's Oil-Rig Deployment 'Provocative,' Dangerous

WASHINGTON—The White House on Friday stepped up criticism of China’s deployment of an , saying the move had complicated relations in the region and made peaceful resolution of territorial disputes more difficult. "This is a provocative act, and it raises tensions in the region," White House spokesman Jay Carney said. China and Vietnam are locked in a dispute over contested waters that both claim as part of their territory. The standoff, which escalated after a state-run Chinese oil company positioned an oil rig in the area, has sparked and raised fears of a military conflict. The U.S. hasn’t taken a position on the nations’ competing sovereignty claims in the region, Mr. Carney said, but said no country should resort to intimidation and threats. "We’re very concerned about dangerous conduct and intimidation by government-controlled assets operating in this area, and we call on all parties to conduct themselves in a […]

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White House Says China’s Oil-Rig Deployment ‘Provocative,’ Dangerous

WASHINGTON—The White House on Friday stepped up criticism of China’s deployment of an , saying the move had complicated relations in the region and made peaceful resolution of territorial disputes more difficult. "This is a provocative act, and it raises tensions in the region," White House spokesman Jay Carney said. China and Vietnam are locked in a dispute over contested waters that both claim as part of their territory. The standoff, which escalated after a state-run Chinese oil company positioned an oil rig in the area, has sparked and raised fears of a military conflict. The U.S. hasn’t taken a position on the nations’ competing sovereignty claims in the region, Mr. Carney said, but said no country should resort to intimidation and threats. "We’re very concerned about dangerous conduct and intimidation by government-controlled assets operating in this area, and we call on all parties to conduct themselves in a […]

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The Meat Crisis Is Here: Price Of Shrimp Up 61% – 7 Million Pigs Dead – Beef At All-Time High

As the price of meat continues to skyrocket, will it soon be considered a “luxury item” for most American families?  This week we learned that the price of meat in the United States rose at the fastest pace  in more than 10 years  last month. Leading the way is the price of shrimp.  According to the U.S. Bureau of Labor Statistics, the price of shrimp has jumped an astounding 61 percent compared to a year ago.  The price of pork is also moving upward aggressively thanks to a disease which has already killed about 10 percent of all of the pigs in the entire country.  And the endless drought in the western half of the country has caused the size of the U.S. cattle herd to shrink to a 63 year low and has pushed the price of beef to an all-time high.  This is really bad news if […]

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Eagle Ford Update, Texas Condensate and Natural Gas

This is a brief update on Eagle Ford Crude plus Condensate (C+C) output through February 2014.  It can also be found at Peak Oil Climate and Sustainability.  Figure 1- RRC Data provided by Kevin Carter  I have used my usual method of estimation where I find the percentage of total Texas(TX) C+C output that is from the Eagle Ford(EF) play (I call this %EF/TX ) and multiply this by the EIA’s estimate of TX C+C output. The chart shows the Railroad Commission of Texas (RRC) Eagle Ford estimate (EF RRC) in thousands of barrels per day (kb/d), the EF est (kb/d) as described above, the percentage of EF C+C that is condensate (EF %cond/C+C), and the %EF/TX also described above. As before I would like to thank Kevin Carter who created a method to simplify gathering the Eagle Ford data. I have done estimates of Eagle Ford output several times before […]

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US market better equipped to handle low gas inventories: Goldman Sachs

Less coal-to-gas switching, pipeline debottlenecking in key regions and strong production will allow the US natural gas market to cope with historically low inventory levels, Goldman Sachs analysts said. While the market will likely fall 400 Bcf short of the traditional end-October inventory level of 3.8 Tcf, the better supplied environment due to shale plays mean "fewer inventories than normal will be needed to serve the market as production can take up the slack," Goldman said Thursday in a note to clients. As of May 9, working gas in storage was 1.60 Tcf, 790 Bcf less than last year and 959 Bcf below the five-year average of 2.119 Tcf, according to the US Energy Information Administration. The severe winter took inventories to a 10-year low. Article continues below… Gas Daily offers the most detailed coverage of natural gas prices at interstate and intrastate pipeline and pooling points in major […]

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Pa. Dems fight to prove they can milk fracking for all it’s worth

Lycoming County looks like a lot of the rest of Pennsylvania: Pothole-marked roads snake through mountains and farmland, leading to little one-street towns that often contain little more than a coffee shop, a bank, a gas station and a bar. But ever since companies like Anadarko, EXCO Resources, XTO Energy and Range Resources came to town, everyday life has had a little more buzz around here. Eighteen-wheelers zip by day and night, cafes and restaurants in small cities like Williamsport are busy, and the parking lots of the Holiday Inns, Marriotts and many independent motels are packed with pickups from out of state. This is fracking country, and to supporters of the practice, Lycoming represents all the good that can come from it — jobs, economic growth and energy independence. To fracking’s detractors, Lycoming represents everything wrong with Pennsylvania, namely the state’s apparent willingness to embrace […]

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Chesapeake Energy to Spin Off Oilfield Services Business

Chesapeake Energy Corp. said Friday that it will proceed with a spinoff of its oil-field services operations to shareholders as it also plans other asset sales. The oil and natural-gas company filed earlier this year for a possible spinoff of Chesapeake Oilfield Operating LLC, a move the company had been considering. Chesapeake plans to change the name of the division to Seventy Seven Energy Inc. upon the spinoff. The division—which offers drilling, hydraulic fracturing and rig relocation, among other services—pulled in about $2.2 billion in revenue last year. This and other planned asset sales will bring the total value of sales and divestitures in 2014 to more than $4 billion, the company said. Chesapeake has already received more than $925 million of asset sale proceeds so far this year. Upon completion of the spinoff—which the company intends to be tax-free to its shareholders—and an expected recapitalization, about $1.1 billion […]

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Southern states get gasoline break from EPA

WASHINGTON, May 16 (UPI) –The Environmental Protection Agency said it waived gasoline requirements for parts of North Carolina and Florida because of good air quality standards. EPA said it was responding to requests from state authorities to remove counties from certain gasoline requirements for the summer. EPA said it was taking the action because states or counties have demonstrated they’re in compliance with ozone quality standards. The so-called winter blend of gasoline is cheaper to manufacture than the summer blend because of processes needed to decrease emissions that contribute to heightened ozone and smog levels. Summer blends give drivers better gas mileage, though it’s expensive to produce. Heather McTeer Toney, a regional administration for the EPA, said the waiver is a direct result of collaborative efforts to improve air quality in the respective districts. "This action is especially important during hurricane season when greater adaptability is needed for the […]

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Cove Point LNG draws mixed reviews

Environmental advocacy groups said U.S. regulators need to restart their review process for an export license for liquefied natural gas from Cove Point, Md. The Federal Energy Regulatory Commission issued its environmental assessment for the LNG terminal in Maryland. Dominion Energy wants to ship 770,000 cubic feet of LNG per day to countries that don’t have a free-trade agreement with the United States. FERC, in a 241-page filing , said there would be "no significant impact" on the environment provided the company follows the estimated 80 mitigation measures. Diane Leopold, president of Dominion Energy, said the review was " thorough and independent ." FERC’s assessment drew fire from environmental groups concerned about the impacts of the facility. "FERC has failed the public once again with the release of this flimsy and deeply flawed environmental review," Jorge Aguilar, the southern region director for Food & Water […]

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Energy Rigs Advance to Match Highest Count Since 2012

Rigs targeting oil and natural gas in the U.S. increased this week, tying a 20-month high, as energy producers used a record number of horizontally drilling ones to reach deposits trapped in shale formations across the middle of the country. The oil and gas rig counts grew by three each, bringing the total to 1,861, matching the high set on April 25, data posted on Baker Hughes Inc. (BHI) ’s website show. Rigs drilling horizontally to bore across formations gained five to reach a record 1,248, the Houston-based field services company said. Energy producers are using more efficient drilling techniques to draw record volumes of oil and gas out of from U.S. shale formations, boosting domestic crude production to the highest level in a quarter-century and bringing the nation closer to energy independence than it has been in 28 years. Horizontal rigs in tight-oil plays surged in the first […]

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Canada Unveils New Fines for Rail-Safety Violations

Canada on Friday said railway companies will now face fines of up to 250,000 Canadian dollars ($229,843) for safety violations, the government’s latest move to toughen standards in the sector in the wake of last summer’s deadly derailment in Lac-Mégantic, Quebec. The Canadian government said the new monetary penalties, which will vary based on the severity of the violation, will "provide a faster alternative to prosecution," and are similar to those in place in the marine and aviation sectors. Individuals who violate rail-safety rules will also be subject to fines, but to the lesser maximum amount of C$50,000. "The proposed regulations introduce penalties as an additional enforcement tool to improve railway safety. These monetary penalties will help crack down on rule-breakers and improve the safety of the Canadian railway system," Canadian Transport Minister Lisa Raitt said in a statement. The July 6, 2013, derailment of a crude-carrying train in […]

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Norway supplies more than 20% of Europe’s natural gas needs

Norway is the world’s third-largest natural gas exporter, after Russia and Qatar. In 2013, Norway supplied 21% of total European natural gas needs. Norway’s natural gas reaches the Continent mainly via its extensive export pipeline infrastructure (see map below), while a small fraction is exported as liquefied natural gas (LNG) by tanker. The largest recipients of Norway’s natural gas exports in 2013 were the United Kingdom, Germany, France, the Netherlands, and Belgium. Source: U.S. Energy Information Administration, with permission from the Norwegian Petroleum Directorate EIA estimates that Norway produced 3.97 trillion cubic feet (Tcf) of dry natural gas in 2013, a decline of 0.18 Tcf from 2012. EIA also estimates that Norway’s net exports for 2013 were 3.8 Tcf of natural gas, which, because of its modest domestic demand, was 96% of its production. Norway’s single largest natural gas field is […]

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UK "needs more home-grown energy"

In just over five years Britain will have run out of oil, coal and gas, researchers have warned. A report by the Global Sustainability Institute said shortages would increase dependency on Norway, Qatar and Russia. There should be a "Europe-wide drive" towards wind, tidal, solar and other sources of renewable power, the institute’s Prof Victor Anderson said. The government says complete energy independence is unnecessary, says BBC environment analyst Roger Harrabin. The report says Russia has more than 50 years of oil, more than 100 years of gas and more than 500 years of coal left, on current consumption. ‘Decisive action’ By contrast, Britain has just 5.2 years of oil, 4.5 years of coal and three years of its own gas remaining. France fares even worse, according to the report, with less than year to go before it runs out of all three fossil fuels. Coal, oil and gas […]

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UK “needs more home-grown energy”

In just over five years Britain will have run out of oil, coal and gas, researchers have warned. A report by the Global Sustainability Institute said shortages would increase dependency on Norway, Qatar and Russia. There should be a "Europe-wide drive" towards wind, tidal, solar and other sources of renewable power, the institute’s Prof Victor Anderson said. The government says complete energy independence is unnecessary, says BBC environment analyst Roger Harrabin. The report says Russia has more than 50 years of oil, more than 100 years of gas and more than 500 years of coal left, on current consumption. ‘Decisive action’ By contrast, Britain has just 5.2 years of oil, 4.5 years of coal and three years of its own gas remaining. France fares even worse, according to the report, with less than year to go before it runs out of all three fossil fuels. Coal, oil and gas […]

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Brent Crude Set for Weekly Gain Amid Ukraine Tension

Brent crude headed for its first weekly advance this month amid speculation that escalating tension in Ukraine may disrupt supplies from Russia , the world’s biggest energy exporter. West Texas Intermediate was set for a second weekly gain after Cushing stockpiles fell. Futures were little changed in London and are up 1.1 percent this week. Ukrainian forces moved to flush separatists from their eastern holdouts as diplomats from the U.S. and U.K. vowed to punish Russia with industry-wide sanctions if this month’s presidential election is undermined. Global demand for OPEC’s crude will be stronger in the second half of 2014 than previously estimated, the International Energy Agency said yesterday. “In the run up to the elections next week the tensions will continue,” Eugen Weinberg , head of commodities research at Commerzbank AG in Frankfurt , said by e-mail. “Even after the presidential elections it’s unlikely to calm down. So […]

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Brent Extends Rally

On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $101.88 a barrel at 0524 GMT, up $0.38 in the Globex electronic session. July Brent crude on London’s ICE Futures exchange rose $0.16 to $109.25 a barrel. Brent crude extended gains after settling higher for four consecutive sessions. The global benchmark is on its longest winning streak since end-March. "The situation in the Ukraine continues to play a role in energy markets," ANZ said in a report this morning. "Russian and European Union energy ministers are due to meet on May 19 to end a dispute over gas prices and avoid further disruptions of energy supplies from the East," the bank said. Secretary of State John Kerry and his counterparts from Europe have threatened broader sanctions against Russia if Moscow interferes with the presidential vote in Ukraine on May 25. On Thursday, the […]

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Oil rises on renewed Ukraine tension, dollar

The price of oil rebounded to near $102 on renewed tension in Ukraine and weakness in the dollar. Benchmark U.S. crude for June delivery was up 15 cents to $101.64 a barrel at 0755 GMT in electronic trading on the New York Mercantile Exchange. The contract fell 87 cents to close Thursday at $101.50. Brent crude, a benchmark for international oil used by many U.S. refineries, rose 8 cents to $109.14 in London. Russian President Vladimir Putin stoked tensions with Ukraine by warning his country wouldn’t deliver gas to its neighbor unless it receives payment in advance, part of a dispute over an unpaid energy bill. Ukraine is a major conduit for Russian gas deliveries to Europe. The dollar’s weakness against some Asian currencies also helped support crude prices. It fell against the Indian rupee following the pro-business opposition’s election victory in India. Oil, which is priced in dollars, […]

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Natural-Gas Prices Rise Off Six-Week Low on Lower-Than-Expected Stockpile Addition

Natural-gas prices jumped more than 2% on data that showed producers added less gas than expected to stockpiles. U.S. gas inventories rose by 105 billion cubic feet in the week ended May 9, the U.S. Energy Information Administration said Thursday. However, that figure includes 8 bcf that storage operators had previously used to run their facilities, a one-time addition that many traders discounted. The remaining 97 bcf addition was below forecasts. Traders use the data to measure how quickly producers are rebuilding stockpiles depleted during a frigid winter. Inventories now stand at about 1.2 trillion cubic feet, 46% below the five-year average. Gas for June delivery jumped 2.3% to $4.469 a million British thermal units on the New York Mercantile Exchange. Producers need to beat the five year average storage additions by 20 to 35 bcf each week for the next six months in order […]

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Global Growth Worries Climb

A spate of worrying economic data Thursday shook stock and bond markets. Economic activity in the 18-country euro zone expanded at a weak annual rate of 0.8% during the first quarter, data released Thursday showed. Excluding Germany, which grew at a robust 3.3% pace, the rest of the euro-area economy contracted slightly during the quarter. European Central Bank officials are now moving toward enacting additional low interest-rate policies to prevent the region from sliding into a lengthy period of economic stagnation, while the U.S. Federal Reserve guardedly tries to wind down a bond-buying program meant to revitalize economic growth. Meantime, Chinese authorities are trying to prod banks to lend more to first-time home buyers shut out of their real-estate market. U.S. officials privately say they expect Chinese officials to act to boost their economy and support banks if growth slows severely, though Chinese officials say they will avoid major […]

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Saudi Gas Reserves Up as Aramco Taps New Shale Deposits

Saudi Arabia ’s natural gas reserves rose last year as it explored for the fuel in the Red Sea and tapped shale gas to free more crude oil for export, according to the kingdom’s state-run oil company. Saudi reserves increased to 288 trillion cubic feet of gas last year from 285 trillion in 2012, Saudi Arabian Oil Co. said today in its annual review. The company is ready to use shale gas to fuel a 1,000-megawatt plant that will feed electricity to a large phosphate mining project, the company known as Saudi Aramco said. “Saudi Arabia will be among the first countries outside North America to use shale gas for domestic power generation,” the company said. “We are actively exploring for unconventional gas resources,” which may be large in scale, it said. The shale gas drive will help the kingdom free more diesel and crude oil for export, the […]

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Pentagon announces $1 billion deal with Iraq

WASHINGTON — The Pentagon has cleared a nearly $1 billion package of aircraft trainers, surveillance aerostats and up-armored Humvees for the Iraqi military. The Defense Security Cooperation Agency (DSCA) notified Congress Tuesday that the State Department approved the sale. The largest part of the deal is 24 Beechcraft T-6C Texan II trainer aircraft. The turboprop aircraft and related services and equipment is estimated to cost $790 million. “The proposed sale of these aircraft, equipment, and support will enhance the ability of the Iraqi forces to sustain themselves in their efforts to bring stability to Iraq and to prevent overflow of unrest into neighboring countries,” a DSCA notice states. Iraq already flies the T-6A trainer. The T-6C has hard points on the wings and advanced avionics. The aircraft are used to train pilots before they move to larger, more sophisticated aircraft. Iraq has already inked a deal to buy 36 […]

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Nigeria April oil revenue down 9% month-on-month on Forcados outage

Nigeria’s oil revenue fell about 9% month-on-month to Naira 474.88 billion ($2.9 billion) in April, due to disruption to oil production and exports at the Shell operated Forcados oil terminal and ExxonMobil’s export terminals, Nigeria’s finance ministry said Friday. "Oil revenue fell to about Naira 474.88 billion in April compared to about Naira 519.99 billion in March. The decline in revenue is due to production shut-in at the Qua Iboe and Yoho terminals as well as the shut down of Forcados," the ministry said in a statement. Consequently, Nigerian government revenue dropped to Naira 584.15 billion in April from Naira 614.35 billion in March. Oil accounts for more than 80% of Nigerian government revenue. But Nigeria’s crude production and exports have declined steadily over the last 12 months because of pipeline problems, production shut-ins and large-scale oil theft. Nigeria’s central bank estimated that the country’s oil production averaged 1.86 […]

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NY Policymakers Seek Ban on Fracking Waste

New York has a pending bill establishing a moratorium on the disposal of fluids used in hydraulic fracturing that occurs outside of the state, according to legislation introduced Tuesday by Democrats in the state Senate. The minority conference released four bills proposing to ban shipping hydraulic fracturing waste product into the state for treatment or disposal as well as ban the waste from being used to melt ice off roads and bar treatment facilities, and landfills from accepting the byproduct. New York, currently holding a moratorium on fracking permits until it completes an environmental impact review that launched in 2008, is reviewing whether fracking should be allowed between its borders. The state Department of Environmental Conservation (DEC) launched its review of large-scale fracturing about 6 years ago. “There is no end in sight for the ongoing 5-year review of fracking in New York,” commented Gov. Cuomo and Dr. Shah […]

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Bakken crude within rail car safety design standards, AFPM study says

Bakken crude oil is well within the safety standards for current rail car designs, an American Fuel & Petrochemical Manufacturers report concluded. The crude is comparable to other light grades and does not pose risks that are significantly different than other crudes or flammable liquids authorized for rail transport, it added. Specifically, Bakken crudes are within pressure, flashpoint, boiling point, and corrosivity standards for use in rail cars approved by the US Department of Transportation, AFPM said in announcing its findings on May 15. It said the report is based on a survey of AFPM members conducted in response to a request by DOT. A third-party auditor collected the data from 17 AFPM member companies on a confidential basis in accordance with federal antitrust laws, the Washington-based trade association noted. “AFPM engaged a former, long-time DOT official with an expertise in hazardous material transportation safety to develop the final […]

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FERC issues EA for Cove Point LNG export project

The US Federal Energy Regulatory Commission has issued its environmental assessment (EA) for the Cove Point LNG liquefaction and export project ( OGJ Online, Mar. 14, 2014 ). The project is proposed by Dominion Cove Point LNG LP (DCP). FERC concluded that “approval of the proposed project, with appropriate mitigating measures, would not constitute a major federal action significantly affecting the quality of the human environment.” It also reported that potential impacts would be reduced with the implementation of DCP’s proposed minimization and mitigation measures and the 82 additional measures recommended in the EA. The project would enable DCP to export 5.75 million tonnes/year of LNG via LNG marine carriers that would dock at the existing offshore pier, FERC said. FERC also has prepared a draft general conformity determination (GCD) to assess the potential air quality impacts associated with construction and operation of the proposed project; the GCD is […]

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US FERC staff anticipates higher electric, gas prices this summer

A hot summer with above-normal temperatures throughout most of the US will likely mean higher electric and natural gas prices this summer, according to the US Federal Energy Regulatory Commission’s summer energy market and reliability assessment. The assessment, presented by FERC staff at the commission’s monthly meeting Thursday, projects particularly high prices for California this summer, made worse by drought and wildfires. A drought in the region has lowered reservoir water storage levels in California to 66% of the historical average and limited snowpack to 33% of its normal level during this time of year, typically the peak of snow accumulation in the state. FERC staff said this could cut hydroelectric power generation in the state in half this summer. Further, state officials are considering the need for water restrictions that could limit the amount of water available to natural gas-fired power plants, staff said. Article continues below… Gas […]

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EPA proposes tightening oil refinery standards for first time in 2 decades

Environmentalists say changes could improve health of many living near refineries, often in impoverished neighborhoods The Environmental Protection Agency on Thursday announced a proposal to tighten oil refinery emission standards for the first time in nearly two decades. Environmentalists hailed the proposed changes as a first step toward reducing rates of cancer and other diseases in “fenceline communities,” the often-impoverished neighborhoods that abut refineries. “The rules look pretty strong, but it’s a solution that’s long overdue,” said James Goodwin, senior analyst at the Center for Progressive Reform. “It was pushed back and pushed back. Every day [the changes] were delayed, more and more people are getting sick.” The proposal is part of a consent decree that resolved a lawsuit filed by attorneys with nonprofit organizations Earthjustice and the Environmental Integrity Project on behalf of Americans directly affected by oil refinery emissions in Louisiana, Texas and California. The changes would […]

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EPA Proposes New Rules to Curb Pollution From Refining

Oil refiners will be required to further curb air pollution from storage tanks, flares and heavy-oil processing equipment under proposed rules released on Thursday by the U.S. Environmental Protection Agency. The agency’s proposals—which are now open to a 60-day public-comment period—also aim to require air tests for benzene at refineries’ fence-lines to make sure that air-quality standards are being met and neighboring communities aren’t affected by emissions. The EPA’s proposed rules issued on Thursday come on the agency’s deadline for reviewing regulations that govern refinery emissions, which it was ordered to do by a federal judge. Several environmental groups sought that ruling, arguing the agency had not fulfilled Clean Air Act requirements to review emissions standards for plants that make fuels such as gasoline and diesel. Calling the measures "common sense steps," the EPA estimated that implementing its proposals would reduce emissions of toxic gases such as benzene, toluene […]

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Natural Gas Weekly Update

New LNG plant in North Dakota will supply oil and gas producers A new natural gas liquefaction plant is slated to come online this summer in North Dakota to reduce the flaring of gas in the Bakken Formation and provide fuel for Bakken oil and gas operations. The developer, Prairie Companies LLC subsidiary North Dakota LNG, announced earlier this month that the plant would provide an initial 10,000 gallons per day (gal/d) of liquefied natural gas (LNG), and could expand to 66,000 gal/d. Assuming a 10% processing loss, the plant would take in a maximum of 6 million cubic feet per day (MMcf/d) once expanded. In 2012, North Dakota vented and flared 218 MMcf/d of natural gas because of record-high oil production and insufficient pipeline takeaway capacity for natural gas produced as a byproduct. Hess Corporation will supply the natural gas for liquefaction at Prairie’s Tioga natural gas processing […]

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Weekly Natural Gas Storage Report

Historical Comparisons Stocks billion cubic feet (Bcf) Year ago (05/09/13) 5-Year average (2009-2013) Region 05/09/14 05/02/14 net change implied flow (Bcf) % change (Bcf) % change East -43.1 -50.3 West -38.3 -34.2 Producing -38.9 866 -44.1     Salt 126 113 226 -44.2 179 -29.6     Nonsalt 358 342 567 -36.9 687 -47.9 Reclassifications from base gas to working gas resulted in increased working gas stocks of approximately 8 Bcf in the East region for the week ending May 9, 2014. The implied flow for the week is an increase of 97 Bcf to working gas stocks. (See Notes and Definitions for more information on "implied flow.") Working gas in storage was 1,160 Bcf as of Friday, May 9, 2014, according to EIA estimates. This represents a net increase of 105 Bcf from the previous week. Stocks were 790 Bcf less than last year at this time and 959 Bcf […]

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Permian Basin drives first-quarter growth in oil-directed horizontal drilling rigs

Source: U.S. Energy Information Administration, based on Baker-Hughes data The Permian Basin, a long time oil- and natural gas-producing region in West Texas and southeastern New Mexico, has seen a significant increase in horizontal oil-directed drilling activity over the past five months. This trend began at the start of 2013, and accelerated from the week ending on December 27, 2013, to the week ending on May 9, 2014. During this time, the number of horizontal, oil-directed rigs in the Permian Basin rose by 63 rigs, 50% of the total increase in the United States. This growth was heavily concentrated in counties in the Permian Basin containing formations with high production potential. Horizontal oil-directed drilling rigs are primarily used to drill wells that produce oil from tight, low-permeability formations. The change in the number of oil-directed horizontal rigs in the Permian Basin does not necessarily mean that it will have […]

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ND oil production up, but not 1 million barrels yet

North Dakota oil production hit another all-time high in March at 977,051 barrels per day after three months of tough winter weather slowed the state’s oil activity. “We are back to setting records, just barely,” Department of Mineral Resources Director Lynn Helms said Tuesday. The preliminary oil production figure for March is a 2.6 percent increase over February’s production. Winter weather continued to affect oil production in March, with a few days where temperatures were well below zero, several days with winds too high for some crews to operate and a snowstorm on the final day of the month, he said. Helms predicts North Dakota oil production will “squeak by” the 1 million barrel per day milestone when April production figures are released next month. Natural gas flaring fell from 36 percent to 33 percent in March, largely because the expanded Hess Corp. gas plant in […]

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Putin's China Visit Highlights Shifting Power Balance

When Russian President Vladimir Putin touches down in China for a closely watched two-day state visit May 20, he will encounter an unbalanced relationship that has grown in Beijing’s favor, tilted by shifts in global energy supplies and Moscow’s increasing friction with the West. Beijing’s leverage is being tested in negotiations to pipe Siberian gas to China that have dragged on for a decade, but that both sides have said they want to conclude in time for an agreement to be signed during Mr. Putin’s visit next week. A Chinese foreign ministry official said Thursday that pricing remains a sticking point. Gazprom , Russia’s natural-gas company, described the talks as being "in the final stage" after a meeting between its chief executive and a senior Chinese energy official. Mr. Putin has already leaned to Beijing in one respect. While he and Chinese President Xi Jinping meet in Shanghai, more […]

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Putin’s China Visit Highlights Shifting Power Balance

When Russian President Vladimir Putin touches down in China for a closely watched two-day state visit May 20, he will encounter an unbalanced relationship that has grown in Beijing’s favor, tilted by shifts in global energy supplies and Moscow’s increasing friction with the West. Beijing’s leverage is being tested in negotiations to pipe Siberian gas to China that have dragged on for a decade, but that both sides have said they want to conclude in time for an agreement to be signed during Mr. Putin’s visit next week. A Chinese foreign ministry official said Thursday that pricing remains a sticking point. Gazprom , Russia’s natural-gas company, described the talks as being "in the final stage" after a meeting between its chief executive and a senior Chinese energy official. Mr. Putin has already leaned to Beijing in one respect. While he and Chinese President Xi Jinping meet in Shanghai, more […]

Posted On : Published By : Tom Whipple