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WTI Oil Rises as U.S. Jobs Gain Signals Stronger Economy

West Texas Intermediate crude climbed as U.S. payrolls exceeded their pre-recession peak, signaling greater fuel demand. Brent slipped as world leaders at D-Day commemorations in France discussed the Ukraine crisis. Futures rose 0.2 percent in New York after the Labor Department said the number of jobs grew 217,000 in May, following a 282,000 gain in April. Russian President Vladimir Putin met with U.S. President Barack Obama and held his first talks with Ukraine’s new leader, Petro Poroshenko, as France used the 70th anniversary of the Allied landings in Normandy to seek a breakthrough in the Ukraine crisis. “The jobs number is being perceived as a positive sign for the overall economy and bullish for demand,” said Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York. “We’ll be keeping an eye on events in France today and see if the leaders and officials gathered […]

Posted On : Published By : Tom Whipple
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Oil Rangebound As Market Awaits US, China Data

Crude-oil futures moved in a narrow price range in Asian trading hours Friday as investors look to today’s U.S. non-farm payrolls report and the weekend’s Chinese trade data for cues. On the New York Mercantile Exchange, light, sweet crude futures for delivery in July traded at $102.53 a barrel at 0536 GMT, up $0.05 in the Globex electronic session. July Brent crude on London’s ICE Futures exchange rose $0.11 to $108.90 a barrel. Brent crude added to overnight gains after the European Central Bank cut interest rates and announcing additional stimulus measures, but any major upside is limited by the region’s depressed oil demand. Later Friday, financial markets will focus on the U.S. non-farm payrolls report for May. Over the weekend, Chinese trade data will provide the level of the country’s oil imports, which are likely to be affected by stockpiling and seasonal maintenance at the large refineries operated […]

Posted On : Published By : Tom Whipple
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Natural Gas Hits One-Month High on Demand Expectations — Update

Natural-gas prices rose to a fresh one-month high Friday on expectations of robust demand for the fuel amid hotter-than-average weather this month. Natural gas for July delivery settled up 0.9 cent, or 0.2%, at $4.710 a million British thermal units on the New York Mercantile Exchange, the highest settlement since May 7. Prices rose 3.7% this week, despite government storage data showing a larger-than-expected increase in supplies. Though producers added more natural gas to storage than analysts had anticipated, supplies are still 37% below the five-year average for the week. Natural-gas stocks were heavily drawn down this winter amid record demand for the heating fuel. Larger-than-average injections will still be needed in the coming weeks and months to replenish supplies to average levels before next winter. "Injections are big but they’re not astronomical — and we’ve […]

Posted On : Published By : Tom Whipple
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Russia's Lukoil reviews Iraqi pipeline options

Russian energy company Lukoil said it was including pipeline construction in the terms of its contract for the West Qurna-2 oil field in Iraq. Lukoil President Vagit Alekperov met in Baghdad with Iraqi Oil Minister Abdul Kareem al-Luaibi to sign contract revisions. The addendum for the so-called Tuba-Fao pipeline system calls for the construction of two 75-mile long pipelines and associated infrastructure. The system will link the oil field to an export terminal in Basra, situated along the coast of the Persian Gulf. "The construction of the Tuba-Fao Pipeline will provide for a direct connection between the West Qurna-2 field and the country’s largest export terminal, creating opportunities for further production growth from the field," Alekperov said in a statement Thursday. First oil was produced from West Qurna-2 in March. It has since reached a daily production reach of 120,000 barrels and has an estimated 34 billion barrels worth […]

Posted On : Published By : Tom Whipple
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Russia’s Lukoil reviews Iraqi pipeline options

Russian energy company Lukoil said it was including pipeline construction in the terms of its contract for the West Qurna-2 oil field in Iraq. Lukoil President Vagit Alekperov met in Baghdad with Iraqi Oil Minister Abdul Kareem al-Luaibi to sign contract revisions. The addendum for the so-called Tuba-Fao pipeline system calls for the construction of two 75-mile long pipelines and associated infrastructure. The system will link the oil field to an export terminal in Basra, situated along the coast of the Persian Gulf. "The construction of the Tuba-Fao Pipeline will provide for a direct connection between the West Qurna-2 field and the country’s largest export terminal, creating opportunities for further production growth from the field," Alekperov said in a statement Thursday. First oil was produced from West Qurna-2 in March. It has since reached a daily production reach of 120,000 barrels and has an estimated 34 billion barrels worth […]

Posted On : Published By : Tom Whipple
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Iraq dislodges insurgents from city of Samarra with airstrikes

Iraqi helicopters bombed the city of Samarra after insurgents overran parts of it early on Thursday, bringing them within striking distance of a Shi’ite shrine the destruction of which in a 2006 attack unleashed a bitter sectarian war. The offensive is part of an escalating conflict between Iraq’s Shi’ite Muslim-led government and Sunni Islamist militants who have been regaining momentum in the past year, particularly in the west of the country bordering Syria. The Iraqi army and SWAT forces had regained control in Samarra, killing dozens of insurgents and forcing the rest to retreat from the city after they moved in overnight, the Samarra Operations Command said. Militants advanced on Samarra in pick-up trucks, raiding checkpoints along the way and blowing up a police station in an attack that killed several policemen, security sources said. After entering the city from the east and west, they […]

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Premier Barzani Denies Oil Exports a Prelude to Kurdish Independence

Kurdistan Region Prime Minister Nechirvan Barzani denied that Kurdish oil exports were a prelude to seeking independence from Iraq, saying Erbil only wanted to ensure it receives the revenues promised to it under the constitution. In a speech to the Kurdistan parliament on Wednesday, Barzani blamed Baghdad for a current row over independent oil exports by Erbil, saying that many problems could have been avoided if the central government had reached an agreement on sharing the revenues from oil sales. “We don’t see this (oil exports) as a way for the independence of Kurdistan. Indeed it is not so!” declared Barzani, who is officially prime minister of a caretaker government until a new Kurdistan Regional Government (KRG) is announced. “We want to implement our constitutional rights within Iraq,” he said, answering questions from […]

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Iraq: Key Shi’ite coalitions urge withdrawal of Maliki’s bid for third premiership

Incumbent prime minister claims to have secured a majority to form government Iraqi Prime Minister Nuri Al-Maliki casting his vote at a polling station in Baghdad’s fortified Green Zone on April 30, 2014. (AFP Photo/Ali Al-Saadi) Baghdad, Asharq Al-Awsat —Rival Shi’ite political blocs have reiterated their strong opposition to Iraqi Prime Minister Nuri Al-Maliki’s bid for a third term in office, amid claims by each side that they secured the majority required to form a government. The National Alliance—comprised of the leading Shi’ite forces, the Islamic Supreme Council of Iraq (ISCI), the Sadrist Movement, the National Congress and the Reform Trend—has urged the State of Law coalition to withdraw the nomination of its leader, Nuri Al-Maliki, to head the new government, according to a statement read out by the coalition’s spokesman, Ibrahim Bahr Al-Ulloum, following a meeting by coalition leaders in Baghdad two days ago. Maliki’s coalition came first […]

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Libya: Oil Output Drops Further

Libya has much of the world’s highest quality crude oil. But since the fall of long-time leader Moammar Gadhafi in 2011, production has been sporadic and on the decline. After assessing Libya’s political instability, violence and armed groups battling for control, John Kingston summed up prospects for the country’s oil industry this way: "There’s essentially no good news there." Kingston is director of news for Platts, which provides information on the global energy, petrochemical, metals and agriculture industries. He said during Gadhafi’s rule, Libya produced about 1.6-million barrels a day. "Their quality of crude is extremely high. So, for production of transportation fuels, like gasoline and diesel, if you lose a barrel out of Libya, you have to produce more than a barrel of heavier crude somewhere else to make up for it. Not all barrels are alike. And a Libyan barrel is more equal than […]

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Report: Exxon May Take Over as Kashagan Operator

U.S. oil major Exxon Mobil is in line to take over as operator of the giant Kashagan field in an attempt to fix the beleaguered $50 billion project offshore Kazakhstan, industry publication Nefte Compass reported on Friday. Discussions are continuing but Exxon could be appointed as soon as at the end of June, the newsletter quoted a senior Kazakh official as saying. Exxon was not immediately available for comments. Italy’s Eni was given the job of operating the project in 2001. It later lost its role as the sole lead operator following major delays and cost overruns. Production finally started last September but was halted in early October after the discovery of gas leaks in the pipeline network. Oil output may now not restart until early 2016, Kazakh Oil and Gas Minister Uzakbai Karabalin said in May, urging foreign partners to start replacing leaky […]

Posted On : Published By : Tom Whipple