Category:

As cash flow flattens, major energy companies increase debt, sell assets

Cash from operations for major energy companies has flattened in line with flat crude oil prices, which have had the lowest price volatility in years. Based on data compiled from quarterly reports, for the year ending March 31, 2014, cash from operations for 127 major oil and natural gas companies totaled $568 billion, and major uses of cash totaled $677 billion, a difference of almost $110 billion. This shortfall was filled through a $106 billion net increase in debt and $73 billion from sales of […]

Posted On : Published By : Tom Whipple
Category:

EIA: Firms with flattened cash flow increase borrowing to meet spending

In line with the lowest price volatility in years and stable crude oil prices, cash flow from operations for major energy companies has flattened. Data compiled from quarterly reports suggest that, for the year ending Mar. 31, cash from operations for 127 major oil and gas companies totaled $568 billion, and major uses of cash totaled $677 billion, generating a gap of almost $110 billion, according to a recent study by the US Energy Information Administration . The study noted that to fill the shortfall and increase the overall cash balance, major energy companies have increased net debt by $106 billion and gained proceeds of $76 billion from asset sales. EIA also noted that, during the past 3 years, the gap between cash from operations and major uses of cash has widened in recent years from a low of $18 billion in 2010 to $100-120 […]

Posted On : Published By : Tom Whipple
Category:

EU Aims at Russian Banks, Technology in Widest Sanctions Yet

The European Union curbed Russia’s access to bank financing and advanced technology in its widest-ranging sanctions yet over President Vladimir Putin ’s backing of the rebellion in eastern Ukraine. EU governments agreed today in Brussels to bar Russian state-owned banks from selling shares or bonds in Europe and restricted the export of equipment to modernize the oil industry, a key prop for Russia’s economy, two EU officials told reporters. New contracts to sell arms to Russia and the export of machinery, electronics and other civilian products with military uses will also be banned. “The political implications of the escalation in tensions are likely to cast a further chill over relations between Russia and the West,” Citigroup Inc. analysts including Eric Lee and Tina Fordham said in a note to clients before the EU decision. “Economic costs are starting to bite, but it could be a while before the economic […]

Posted On : Published By : Tom Whipple
Category:

EU and U.S. announce new sanctions on Russia over Ukraine

The European Union and the United States on Tuesday announced further sanctions against Russia, targeting its energy, banking and defense sectors in the strongest international action yet over Moscow’s support for rebels in eastern Ukraine. The measures mark the start of a new phase in the biggest confrontation between Moscow and the West since the Cold War, which worsened dramatically after the downing of Malaysian flight MH17 over rebel-held territory on July 17 by what Western countries say was a Russian-supplied missile. "If Russia continues on this current path, the costs on Russia will continue to grow," President Barack Obama said in Washington. "Russia’s actions in Ukraine and the sanctions that we’ve already imposed have made a weak Russian economy even weaker," he said. In Brussels, diplomats said ambassadors from the 28-member European bloc agreed to restrictions on trade of equipment for the oil and defense […]

Posted On : Published By : Tom Whipple
Category:

Siemens to BP Prepare for Downward Russia Business Spiral

BP Plc , Siemens AG and Renault SA are among European companies preparing for a downward turn in their Russian business following the European Union’s decision to impose its widest-ranging sanctions yet over President Vladimir Putin ’s involvement in eastern Ukraine. EU leaders announced plans yesterday to restrict the export to Russia of equipment to modernize the oil industry and forbid the sale of machinery, electronics and other civilian products with potential military uses. New arms contracts with Russia are also not allowed. The sanctions will have a direct impact on companies like Siemens, which may no longer be able to sell oil equipment to Russia, and an indirect effect on many others like Renault, which expects the country’s auto market to contract more than 10 percent in 2014 as consumers hold back purchases. BP, owner of 20 percent of state-backed OAO Rosneft , yesterday warned of risks to […]

Posted On : Published By : Tom Whipple
Category:

Russia's central bank supports sanctions targets

Russia’s central bank promised to support financial institutions hit by U.S. sanctions as stocks took a tumble in Moscow on Wednesday. In an online statement, the bank promised to "take adequate measures" to support targeted institutions. Russia’s state-owned VTB bank – Russia’s second-largest – was down 0.5 percent on Wednesday morning. Other major banks that were left unscathed by sanctions – such as the country’s largest, Sberbank – were trading higher. Russia’s MICEX benchmark index added 2.3 percent from its previous closing. U.S. officials said Tuesday that roughly 30 percent of Russia’s banking sector assets are now constrained by sanctions. The move comes after Malaysia Airlines Flight 17 was shot down over eastern Ukraine. Western officials accuse pro-Russian separatists of bringing down the plane with a missile supplied by Moscow. The West also halted future sales to lucrative Russian economic sectors, with the U.S. announcing plans […]

Posted On : Published By : Tom Whipple
Category:

Russia’s central bank supports sanctions targets

Russia’s central bank promised to support financial institutions hit by U.S. sanctions as stocks took a tumble in Moscow on Wednesday. In an online statement, the bank promised to "take adequate measures" to support targeted institutions. Russia’s state-owned VTB bank – Russia’s second-largest – was down 0.5 percent on Wednesday morning. Other major banks that were left unscathed by sanctions – such as the country’s largest, Sberbank – were trading higher. Russia’s MICEX benchmark index added 2.3 percent from its previous closing. U.S. officials said Tuesday that roughly 30 percent of Russia’s banking sector assets are now constrained by sanctions. The move comes after Malaysia Airlines Flight 17 was shot down over eastern Ukraine. Western officials accuse pro-Russian separatists of bringing down the plane with a missile supplied by Moscow. The West also halted future sales to lucrative Russian economic sectors, with the U.S. announcing plans […]

Posted On : Published By : Tom Whipple
Category:

BP frets over 'strategic objectives in Russia'

British energy company BP said Tuesday its second quarter profits soared, but any additional sanctions could impact "strategic objectives in Russia." BP reported second quarter replacement cost profits, a measure that eliminates oil price volatility, at $3.2 billion, up 34 percent from the same period in 2013. BP Chief Executive Bob Dudley said in a statement cash flow during the second quarter was "robust." The company attributed its strong second quarter to upstream operations in the Gulf of Mexico and overhauls at its refinery in Whiting, Indiana. Elsewhere, the company said sanctions on the Russian energy sector, particularly oil company Rosneft, could impact business operations in Russia. "Any future erosion of our relationship with Rosneft, or the impact of further economic sanctions, could adversely impact our business and strategic objectives in Russia, the level of our income, production and reserves, our investment in Rosneft and our reputation," the company […]

Posted On : Published By : Tom Whipple
Category:

BP frets over ‘strategic objectives in Russia’

British energy company BP said Tuesday its second quarter profits soared, but any additional sanctions could impact "strategic objectives in Russia." BP reported second quarter replacement cost profits, a measure that eliminates oil price volatility, at $3.2 billion, up 34 percent from the same period in 2013. BP Chief Executive Bob Dudley said in a statement cash flow during the second quarter was "robust." The company attributed its strong second quarter to upstream operations in the Gulf of Mexico and overhauls at its refinery in Whiting, Indiana. Elsewhere, the company said sanctions on the Russian energy sector, particularly oil company Rosneft, could impact business operations in Russia. "Any future erosion of our relationship with Rosneft, or the impact of further economic sanctions, could adversely impact our business and strategic objectives in Russia, the level of our income, production and reserves, our investment in Rosneft and our reputation," the company […]

Posted On : Published By : Tom Whipple
Category:

Europe, U.S. Significantly Expand Sanctions Against Russian Economy

President Barack Obama said the U.S. is intensifying its economic sanctions against Russia, hitting Moscow’s energy, arms and banking industries in response to what he said was President Vladimir Putin’s continued fueling of violence in eastern Ukraine. Jerry Seib joins the News Hub with Sara Murray. Photo: Getty Images. The U.S. and the European Union adopted sweeping economic sanctions against Russia on Tuesday to punish Moscow’s unbending stance in the Ukraine conflict. The question for the West now is whether the move will make Russian President Vladimir Putin more cooperative or prompt him to dig in. The trade and investment restrictions that EU governments, after much agonizing, agreed upon mark a major escalation of sanctions against Russia, which so far have been mostly token measures targeting individuals. New measures hitting Russia’s banks, oil industry and military could increase financial strains in its already sluggish economy while withholding technology that […]

Posted On : Published By : Tom Whipple
Category:

As Sanctions Pile Up, Russians’ Alarm Grows Over Putin Tactics

Russia, facing the toughest round of Western sanctions imposed since the Ukraine crisis erupted, has adopted a nonchalant public stance, with President Vladimir V. Putin emphasizing the importance of self-reliance and a new poll released Tuesday indicating a “What, me worry?” attitude among the bulk of the population. But beneath that calm facade, there is growing alarm in Russia that the festering turmoil in Ukraine and the new round of far more punitive sanctions — announced Tuesday by both European nations and the United States — will have an impact on Russia’s relations with the West for years to come and damage the economy to the extent that ordinary Russians feel it. Until now, Mr. Putin’s tactics seemed to be working. Russia was feeding the separatist insurgency in Ukraine without leaving distinct fingerprints — able to press Kiev to come to terms while avoiding a rupture with […]

Posted On : Published By : Tom Whipple
Category:

Coordinated Sanctions Aim at Russia’s Ability to Tap Its Oil Reserves

The United States and Europe kicked off a joint effort on Tuesday intended to curb Russia’s long-term ability to develop new oil resources, taking aim at the Kremlin’s premier source of wealth and power in retaliation for its intervention in Ukraine. In announcing coordinated sanctions, American and European leaders went beyond previous moves against banking and defense industries in an effort to curtail Russia’s access to Western technology as it seeks to tap new Arctic, deep sea and shale oil reserves. The goal was not to inhibit current oil production but to cloud Russia’s energy future. The new strategy took direct aim at the economic foundation of Russia, which holds the largest combined oil and gas reserves in the world. The growth of the oil industry in the last two decades has powered Russia’s economic and geopolitical resurgence since the collapse of the Soviet Union and enriched […]

Posted On : Published By : Tom Whipple
Category:

Ukraine army closes in on Donetsk

Ukraine’s army has said it has retaken a town on the outskirts of the main rebel stronghold of Donetsk, and intercepted another convoy of vehicles crossing over from Russia. Government forces said in a statement on Wednesday that they had seized control of Avdiyivka, a town of about 40,000 about a dozen kilometres north of Donetsk, as Ukraine tightened its grip around the key rebel bastion. The Ukrainian government said on its website that 19 people had died in the fighting in the past 24 hours, with 31 people injured. Elsewhere, clashes continued around the crash site of Malaysia Airlines Flight 17, with government forces saying they were conducting a "mopping up" operation in the town of Ilovaysk, about 40km west of the site. International observers announced they had turned back from another attempt to reach crash site after discussions with rebels, AP news agency reported. Safety concerns and […]

Posted On : Published By : Tom Whipple
Category:

WTI Oil Trades Near 2-Week Low Before Supply Data; Brent Steady

West Texas Intermediate crude traded near the lowest level in almost two weeks before data on fuel supplies and economic strength in the U.S., the world’s biggest oil consumer. Brent was steady in London . Futures dropped as much as 0.4 percent in New York . Gasoline stockpiles probably expanded to the highest level since March, a Bloomberg News survey showed before a report from the Energy Information Administration tomorrow. Government data on second-quarter gross domestic product and monthly payrolls are also scheduled this week. The U.S. and European Union may move as soon as today to impose tougher sanctions against President Vladimir Putin ’s government over Ukraine. “The outlook for crude demand is beginning to play a bigger role in the market” and so this week’s economic data will be “instrumental,” Jens Pedersen, an analyst at Danske Bank A/S in Copenhagen, said by e-mail. “Other than that, the […]

Posted On : Published By : Tom Whipple
Category:

NYMEX August gas falls 3.4 cents to $3.747/MMBtu close in choppy trade

NYMEX August natural gas futures fell 3.4 cents to settle at $3.747/MMBtu Monday in somewhat choppy trading as the market consolidated ahead of Tuesday’s contract expiration. The contract started off the day in positive territory, trading nearly 7 cents above Friday’s close, then fell by midday, hitting a low of $3.728/MMBtu before consolidating a few cents higher. "We started the day off with some short-covering, and then when that dried up the fundamentals reasserted themselves," said broker Gene McGillian at TFS Energy Futures. "We’ve had a steady influx of bearish factors to contend with and have gone down about 25% in the past month and a half," McGillian added. "But there’s some risk-reward to these prices levels, and we might start seeing things turn around if we get some uptick in power demand. At that point some of the shorts that piled in below $4 might have their feet […]

Posted On : Published By : Tom Whipple
Category:

Natural gas injection season continues on pace for record refill

STEO denotes EIA’s Short-Term Energy Outlook Nearly midway through the summer storage injection season, working natural gas in storage is on pace to meet EIA’s expectations for a record overall build. The current Short-Term Energy Outlook projects a record build of close to 2,600 billion cubic feet (Bcf) from the beginning of April through the end of October, which would put inventories at 3,431 Bcf at the end of October. Following an extremely cold winter , storage inventories at the end of the heating season were only 857 Bcf, the lowest level since 2003. Inventories were around 1,000 Bcf less than the five-year (2009-13) average. While the refill season began slowly in April, injections quickly ramped up in May and have substantially exceeded five-year average levels each week since then. For eight straight weeks, the weekly net injection […]

Posted On : Published By : Tom Whipple
Category:

Oil Prices Continue to Shrug Off Geopolitical Tensions

Brent crude oil prices were slightly up Tuesday morning and U.S. oil was almost unmoved as traders shrugged off the likelihood of increased sanctions against Russia. Europe is Russia’s largest trading partner, and it is expected to target transactions with Russia’s state banks, as well as limit technology exports vital for the country’s oil and weapons industries, in response to the Kremlin’s interference in Ukraine. The U.S. has said it would take a similar path. "The oil market still appears determined to ignore the numerous sources of geopolitical tension," wrote analysts at Commerzbank in a note to clients. "One explanation of the puzzling weakness of oil prices could be concerns about the negative economic impact of sanctions against Russia." Supply remains ample, globally, despite problems getting Libyan oil to international buyers at a price they are willing to pay. ICE September crude was up 0.39% at […]

Posted On : Published By : Tom Whipple
Category:

Iran leader calls for arming Gaza to fight Israel

Iran’s supreme leader on Tuesday called on Muslims from around the world to help arm Gaza Palestinians in their fight against Israel. The call by Ayatollah Ali Khamenei was his latest such message during the ongoing war between Gaza’s Hamas rulers and Israel. Khamenei claims that while Israel and America seek to disarm Hamas, Iran says "the opposite … the Muslim World has a duty to arm the Palestinian nation by all means." Iran, a staunch Hamas ally, does not recognize Israel and supports militant anti-Israeli groups such as the Palestinian Hamas and Lebanon’s Shiite Hezbollah group. Iran does not recognize Israel and has considered the Jewish state its archenemy since the 1979 Islamic Revolution that toppled the Western-backed monarchy and brought clerics to power Khamenei spoke at a prayer ceremony in Tehran as Shiite Iranians marked the beginning of Eid al-Fitr holiday that follows […]

Posted On : Published By : Tom Whipple
Category:

Iraq Gets Court Order Seizing Kurdish Crude Off Texas

The Iraqi Oil Ministry persuaded a U.S. judge to issue an order for the seizure of more than $100 million of oil in a tanker waiting off Galveston, Texas , that it claims was illegally pumped from wells in Kurdistan. Kurdish officials “misappropriated” more than 1 million barrels of oil from northern Iraq and exported it through a Turkish pipeline, according to a complaint filed yesterday in federal court in Houston. U.S. Magistrate Judge Nancy Johnson of Galveston hours later issued an order and arrest warrant authorizing U.S. marshals to seize the cargo and have it moved ashore for safekeeping until the dispute is resolved. The U.S. officially recognizes Kurdistan as part of Iraq, although the Kurdish people have jockeyed with the Baghdad-based national government for autonomy for more than a decade. Oil revenues from the northern oil fields could fuel Kurdistan’s fight for independence. The Iraqi government warned […]

Posted On : Published By : Tom Whipple
Category:

Libya Warns of Disaster as Tripoli Fuel Tank Fire Spreads

Libya warned Monday of the risk of a humanitarian and environmental disaster after a second fuel tank caught fire amid heavy fighting at Tripoli airport between rival militias. Nearly 100 people have been killed during two weeks of clashes over control of the airport. The fighting led to the evacuation of the U.S. Embassy in Tripoli on Saturday and the German Foreign Ministry said Monday it had evacuated its embassy as well. A missile late Saturday ignited a storage tank containing petroleum fuel at a complex near the airport. The igniting of a second tank has increased the risk of an explosion at the site, which contains 90 million liters (almost 24 million gallons) of fuel and cooking gas. After requesting international assistance, Libya’s […]

Posted On : Published By : Tom Whipple
Category:

Egypt military kills 7 militants in volatile Sinai

Egyptian troops killed seven suspected militants and arrested five as part of an ongoing offensive in the volatile Sinai Peninsula where the military has been trying to quell a spreading insurgency by Islamic militants, an army spokesman said. According to a statement posted on Brig. Gen. Mohammed Samir’s official Facebook page late Monday, the troops killed three militants in an exchange of fire while four others died when a group tried to attack a house of in the border town of Rafah. Five militants were arrested and five were wounded, the posting said but it was unclear if the five were the same people in both cases. Militant attacks in Sinai and elsewhere in Egypt have escalated since the military’s ouster last July of the country’s Islamist President Mohammed Morsi and its subsequent crackdown on his Muslim Brotherhood supporters. Militant attacks have also at times spread […]

Posted On : Published By : Tom Whipple
Category:

Japan Rejoining Nuclear Club Leaves Fossil Fuel Appetite

Japan is poised to rejoin the world nuclear club — barely. Yesterday’s report vouching for the safety of Kyushu Electric Power Co. (9508) ’s atomic station in southern Japan means the utility’s two reactors in Sendai may begin operating as soon as October or November, according to Yoko Nobuoka, a Tokyo-based analyst with Bloomberg New Energy Finance. Two more units may be working by the end of the year, she says. The lengthy approval process — utilities began applying to restart their reactors more than a year ago — indicates Japan may remain nuclear-free throughout the summer when power demand is typically at its highest. Even with some nuclear capacity restored, the contribution to Japan’s energy mix will remain marginal, leaving the nation reliant on dirtier-burning fossil fuels such as coal, oil and liquefied natural gas. “We still hold the view of not a wave of nuclear restarts, it’s […]

Posted On : Published By : Tom Whipple
Category:

Chinese Corruption Probe Stretches Into Canada

A Chinese government anticorruption investigation that already has swept aside dozens of officials is now stretching into Canada. A shake-up has hit state-run China National Petroleum Corp.’s Canadian operations and a billion-dollar oil-sands project is now in limbo. The head of a key China National Petroleum subsidiary was recalled to Beijing last month and has since fallen from public view, according to people familiar with the matter. Also in recent weeks, an email announced the replacement of China National Petroleum’s top representative in Canada. The two are being succeeded by a single executive dispatched from Beijing who will play senior roles at both units, according to emails reviewed by The Wall Street Journal. Canadian authorities are aware of "these investigations being conducted by Chinese authorities into Chinese officials," a government official familiar with the matter said. "At this point there is no reason to believe that any Canadians are […]

Posted On : Published By : Tom Whipple
Category:

China to rank environmental performance

The performance of Chinese decision-makers will be vetted in part by their environmental stewardship, a political document said. A briefing issued Sunday by the Communist Party of China said the decisions and administrative activities of Chinese officials will be measured against social, economic and environmental impacts. China’s state-run Xinhua News Agency reported the results of the audits are used to evaluate promotions or punishment for Chinese officials. Beijing this year signed separate bilateral memorandums with the U.S. and British governments to advance the fight against climate-related issues. The United States and China in particular are at odds, however, over the climate responsibilities of developed and developing countries. China is the world leader in emissions. Beijing says it’s readjusted its economic structure in a way that promotes green energy and a low-carbon economy in an effort to combat climate change. The Chinese audits were first launched by the government in […]

Posted On : Published By : Tom Whipple
Category:

U.S., EU Ready New Sanctions as Russia Prepares Response

The U.S. and the European Union may move as soon as today to impose tougher sanctions on Russia as Vladimir Putin ’s government formulates its response to the growing international pressure. The sanctions target “key sectors” of Russia’s economy — finance, defense and energy — and are being imposed in the face of Putin “doubling down” in support of separatists battling Ukrainian troops, U.S. Deputy National Security Adviser Tony Blinken said yesterday. EU governments agreed yesterday to impose travel bans and asset freezes on Putin’s “cronies.” “The longer this goes on, there is the risk of further outrageous actions by the separatists or by Russia that deepen the international crisis,” Blinken said. “So there’s a need to take further action now to convince Russia to change course.” ‘Concrete Steps’ Russia hasn’t effectively put pressure on the separatists to force them to negotiate and hasn’t taken the “concrete steps” asked […]

Posted On : Published By : Tom Whipple
Category:

BP warns of impact of Russia sanctions on profits

Energy company BP warned Tuesday that further international sanctions on Russia could hurt its profits because of its stake in the country’s oil giant, Rosneft. The company said any erosion of its relationship with Rosneft – which is majority controlled by the Russian state, with BP holding a 19.75 percent stake – could also adversely impact its reputation. The U.S. has already put sanctions on Rosneft’s president and prohibited the company from tapping U.S. markets to raise money. The European Union is this week also considering broadening its sanctions to prohibit state-owned companies from using European capital markets. "If further international sanctions are imposed on Rosneft or new sanctions are imposed on Russia or other Russian individuals or entities, this could have a material adverse impact on our relationship with and investment in Rosneft, our business and strategic objectives in Russia and our financial position and […]

Posted On : Published By : Tom Whipple
Category:

Has The Gulf Of Mexico Hit Peak Oil?

There are enough articles on the “myth of peak oil” floating around the Internet to fill a book; and there are enough books on the subject to fill a small library.  One of the common threads throughout these publications is their lack of credible sources, because not only is peak oil real, but we’re rapidly approaching that threshold.  An example that is smacking the United States and the oil industry in the face right now is floating in the Gulf of Mexico.  According to a new government report , oil and natural gas production in the Gulf has been steadily declining for the last decade. The report looked at oil production in the Gulf of Mexico on federal lands only, not any privately-held lands where production is taking place. Since 2010, according to the report , the annual yield of oil from the Gulf has fallen by almost 140 million barrels.  […]

Posted On : Published By : ASPO-USA
Category:

U.S. considers arctic Alaska lease for 2017

The U.S. government said it was calling for information about the oil and natural gas resource potential in the Beaufort Sea off the northern coast of Alaska. The U.S. Bureau of Ocean Energy Management said it wanted to find out more about the oil and gas that could lie in the area as it plans a possible lease sale for 2017. In April, Royal Dutch Shell said that, as traditional oil and gas reserves decline, oil companies will have to look to more challenging locations to keep up with global energy demand. Shell in January suspended efforts to explore Alaskan waters because of costs and court challenges to its exploration campaign. The company maintained the energy potential offshore Alaska may be "enormous." Acting BOEM Director Walter Cruikshank said the federal government is committed to stepping lightly in the northern arctic region off the Alaskan coast. "There […]

Posted On : Published By : Tom Whipple
Category:

Protesters Arrested at America's First Tar Sands Mine

The Uintah County sheriff’s department arrested 21 protesters who chained themselves to a fence at the construction site of the first tar sands mining operation in the U.S., in the Uintah basin of northeast Utah, according to the activist group Utah Tar Sands Resistance . "Uintah sheriffs used force to pull the protesters apart, and also targeted those providing media coverage. One protester is reported as injured," stated a post from Peaceful Uprising , another activist group. The sheriff’s department has declined to comment on the arrests. The Utah Supreme Court dismissed a case against the project last month. Though the Uintah mine, owned by Canadian-based US Oil Sands , is the first tar sands mine in the US, Canada has been heavily mining the Alberta region for tar sands for several years. The heavily contested Keystone XL pipeline would transport Canadian bitumen–the stuff extracted from tar sands–from Alberta […]

Posted On : Published By : Tom Whipple
Category:

Protesters Arrested at America’s First Tar Sands Mine

The Uintah County sheriff’s department arrested 21 protesters who chained themselves to a fence at the construction site of the first tar sands mining operation in the U.S., in the Uintah basin of northeast Utah, according to the activist group Utah Tar Sands Resistance . "Uintah sheriffs used force to pull the protesters apart, and also targeted those providing media coverage. One protester is reported as injured," stated a post from Peaceful Uprising , another activist group. The sheriff’s department has declined to comment on the arrests. The Utah Supreme Court dismissed a case against the project last month. Though the Uintah mine, owned by Canadian-based US Oil Sands , is the first tar sands mine in the US, Canada has been heavily mining the Alberta region for tar sands for several years. The heavily contested Keystone XL pipeline would transport Canadian bitumen–the stuff extracted from tar sands–from Alberta […]

Posted On : Published By : Tom Whipple
Category:

Hague court rules in favor of Yukos shareholders vs Russia, awards $50 billion: source

The Hague’s arbitration court has ruled in favor of a group of shareholders in defunct oil giant Yukos against Russia, awarding compensation of around $50 billion, a source close to the ruling said on Monday. The Permanent Court of Arbitration in the Hague is expected to announce later today that Russia must pay the compensation – half of the original $100 billion claim – to former shareholders in the company, once Russia’s largest oil producer. The claim in the Hague was made by subsidiaries of Gibraltar-based Group Menatep, a company through which Mikhail Khodorkovsky, once Russia’s richest man, controlled Yukos. Group Menatep now exists as holding company GML and Khodorkovsky is no longer a shareholder in GML or Yukos. (Reporting by Megan Davies , editing by Elizabeth Piper)

Posted On : Published By : Tom Whipple
Category:

Europe leans on Ukrainian energy company

A European energy administration agency said Monday the Ukrainian government needs to examine its contractual relationship with Russian energy company Gazprom. The European Energy Secretariat sent a letter to Ukrainian Energy Minister Yuri Prodan calling for an assessment of the contract between Ukrainian energy company Naftogaz and Gazprom. Parts of the contract, including the take-or-pay clause requiring Naftogaz to pay for a pre-determined volume of gas, serves to "prevent, restrict and distort competition on the natural gas market in Ukraine and affect trade in natural gas within the [European] energy community," the secretariat said in a statement . Gazprom in June switched Naftogaz over to the new payment scheme because of $4.45 billion in overdue bills. Russia supplies about a quarter of the European Union’s gas needs, though most of those supplies run through the Soviet-era transit network in Ukraine. Debt disputes in 2006 and 2009 prompted Gazprom to […]

Posted On : Published By : Tom Whipple
Category:

EU finalises Russian sanctions as BP warns of impact on its business

As the EU prepared to impose far-reaching sanctions on Russia on Tuesday, BP became the first big multinational to warn of the potential scale of the damage to its business in the country. The UK oil major, which owns nearly 20 per cent of Rosneft , the Russian oil group that is majority held by the Russian government, said that its increasing profits in Russia could be hit by the growing push for tighter sanctions. Rosneft is already on the US blacklist, but until now has not been covered by restrictions introduced by the EU. More On this story On this topic IN Europe “If further international sanctions are imposed on Rosneft or new sanctions are imposed on Russia or other Russian individuals or entities, this could have a material adverse impact on our relationship with and investment in Rosneft, our business and strategic objectives in Russia and our […]

Posted On : Published By : Tom Whipple
Category:

World Crude Oil Exports

OPEC has released their Annual Statistial Bulletin 2014 . Under the heading of “Oil and Gas Data” there are several tables you can download. I was excited to find one labeled “Table 3.21: World Exports of Crude Oil and Petroleum Products by Country”. It turned out to be useless however as it includes a lot of exports of imported products. And they have no table of “Net Imports”. However their their table labeled “ Table 3.18: World Crude Oil Exports by Country” turned out to be very useful as it seems to measure the same thing as the EIA does in their International Energy Statistics, Crude Oil Exports  which also includes lease condensate. The OPEC export data goes back to 1960 but I have only plotted it from 1990. The EIA data only goes back to 1993. The OPEC data is through 2013 while the EIA data only goes through […]

Posted On : Published By : Tom Whipple
Category:

Kemp: Forecasts for Higher Oil Prices Misjudge the Shale Boom

The world of energy may have changed forever," according to Professor James Hamilton of the University of California. "Hundred dollar oil is here to stay." Hamilton, who is one of the most respected economists writing about oil, made his bold prediction in a paper on "The Changing Face of World Oil Markets", published on July 20. "Old hands in the oil patch may view recent developments as a continuation of the same old story, wondering if the high prices of the last decade will prove another transient cycle with which technological advances will eventually catch up," he wrote. "But there have been dramatic changes over the last decade that could mark a major turning point." The shale revolution will turn out to be only a pause in the upward […]

Posted On : Published By : Tom Whipple
Category:

Energy Economist: The amount of oil the world uses, seen through different eyes

Counting barrels is always tough to do, as Ross McCracken discusses in this month’s excerpt from Platts Energy Economist. How much oil does the world consume? You’d think this would be a fairly straightforward question, given its economic importance to the world economy, and indeed answers are not hard to find. The problem is those answers differ significantly. Even with the development of the Joint Organisations Data Initiative –an evolving beast designed to bring improved transparency to oil markets–oil market data remains messy, inaccurate and opaque. For 2013, a year which by now should be transitioning from estimate to a matter of historical record, OPEC puts world demand at 90.00 million b/d, the International Energy Agency at 91.40 million b/d and the US Energy Information Administration at 90.49 million b/d. The difference is large in absolute terms–1.4 million b/d between the IEA and OPEC–but small if viewed in percentage […]

Posted On : Published By : Tom Whipple
Category:

Crude Oil Futures Trade Lower on Global Tensions

Crude oil futures traded lower Monday, as tension in several parts of the globe failed to shift the commodity out of a range it has traded in for the last eight days. ICE September crude was down 0.66% at $107.68 a barrel. WTI crude on the Nymex exchange was down 0.62% at $101.46 a barrel. "Challenges remain given weak crude demand in Europe and Asia combined with excess cargoes in the Atlantic Basin," analysts at Morgan Stanley wrote in a note to investors. Prices may need to fall further, they said, before buyers become interested again. A lower price could also shift trade flows or lead to a strategic reduction of supply, for example from a swing producer such as Saudi Arabia. Risks remain in the world’s hot spots. "Geopolitical developments are sure to keep the oil market on its toes," analysts from research firm JBC Energy wrote in […]

Posted On : Published By : Tom Whipple
Category:

WTI Trades Near Week-Low

West Texas Intermediate crude dropped for the fourth time in five days as economic data may signal slowing growth in the U.S., the world’s biggest oil consumer. Brent declined in London . Futures fell as much as 0.7 percent in New York after dropping 1 percent last week. A preliminary index of U.S. service industries is forecast at 59.8 for July, the lowest level in three months, a Bloomberg News survey showed before a report from Markit Economics today. The Federal Reserve is scheduled to review monetary policy at a two-day meeting starting tomorrow. “The PMI figures could be a good indicator of American economic growth ahead of the Fed meeting, U.S. GDP figures and payrolls later in the week,” Thina Saltvedt, an analyst at Oslo-based Nordea Bank AG, said by phone. WTI for September delivery dropped as much as 70 cents to $101.39 a barrel on the New […]

Posted On : Published By : Tom Whipple
Category:

Bulls Fleeing Natural Gas as Goldman Sees Further Decline

Speculators are fleeing natural gas after prices dropped below $4 for the first time since December and power plant production fell to a 13-year seasonal low. Hedge funds reduced net-long positions , or bets on rising prices, by 11 percent in the week ended July 22, the U.S. Commodity Futures Trading Commission said. Bullish wagers have declined 51 percent since February. Futures slid as the output from electricity generators , the biggest consumers of the fuel, fell 11 percent in the week ended July 19 from a year earlier to the least for the period since 2001, according to the Edison Electric Institute. Mild weather and a record pace of inventory gains may push prices lower in the next three months, Goldman Sachs Group Inc. said. “The move down in prices this early in the summer is surprising,” Breanne Dougherty, a natural gas analyst at Societe General SA in […]

Posted On : Published By : Tom Whipple
Category:

Tanker Carrying Kurdish Oil Plans to Offload at Texas Port

A tanker carrying a $100-million cargo of oil shipped from Iraqi Kurdistan is planning to discharge in Texas, bringing a dispute that is central to the future of Iraq as a united country to U.S. soil. The tanker, United Kalavrvta, is one of four major consignments of oil shipped by northern Iraq’s Kurdistan Regional Government since May in defiance of Baghdad. The government claims it has sole authority to market Iraq’s natural resources. The shipments represent a gambit by the KRG to carve out a nation for Iraq’s 6.5 million Kurds, even as the federal government in Baghdad struggles to defend its north against the Jihadist Sunni militant group, the Islamic state. The KRG’s goal to establish an independent state flies in the face of U.S. foreign policy, which is committed to maintaining a unified Iraq. So far, Washington has supported Baghdad’s efforts […]

Posted On : Published By : Tom Whipple
Category:

Abduction of Sunni Displays Gangland Edge of Iraqi Politics

Just before midnight on Friday, Shiite militiamen in eight black S.U.V.’s rolled up to the Baghdad home of an important Sunni politician and abducted him and four of his bodyguards, a brazen move that threatened to further convulse a country already in the grip of a political crisis. For hours at a secret location on Baghdad’s southeastern edge, the bodyguards said, they were beaten with a lead pipe, their tormentors demanding that they admit that their boss, Riyadh al-Adhadh, the president of Baghdad’s provincial council, was preparing to support an invasion of the capital by Sunni militants fighting under the banner of the Islamic State in Iraq and Syria, who are in control of large amounts of territory in the north and west of Iraq. The episode, which ended with the eventual release of the five men, was a vivid portrayal of what Iraqi politics looks like […]

Posted On : Published By : Tom Whipple
Category:

Still Torn by Factional Fighting, Post-Revolt Libya Is Coming Undone

For weeks, rival Libyan militias had been pounding one another’s positions with artillery, mortar rounds and rockets in a desperate fight to control the international airport in the capital, Tripoli. Then suddenly, early Saturday morning, the fighting just stopped. The pause came as United States military warplanes circled overhead, providing air cover for a predawn evacuation of the American Embassy’s staff. Apparently fearing the planes, the militias held their fire just long enough for the ambassador and her staff to reach the Tunisian border — a reminder to Libyans of how even their most powerful allies were incapable of putting out their incendiary feuds. American officials said the evacuation was a temporary measure after fighting drew too close to the embassy. But, coming so soon after the withdrawal of other diplomatic missions, including the United Nations , the moment appeared to signal a defeat — for Libyans […]

Posted On : Published By : Tom Whipple
Category:

Voices from Libya’s armed struggle

Three years after toppling Gaddafi, the revolutionaries have turned on each other Making a stand: crowds in Tripoli come out in support of Gen Khalifa Haftar’s ‘dignity’ campaign against jihadist militias On a Friday afternoon in June in the Libyan capital of Tripoli, a street battle erupts for control of Martyrs Square. It is the first time that Libyans from both sides of an explosive political divide have fought each other for control of a space that represents the aspirations of the 2011 uprising that toppled Muammer Gaddafi. On the north side of the square stand the Islamists. Opposite them are a few hundred men and some women supporting the renegade General Khalifa Haftar’s “dignity” movement, which wants to crush the Islamists. At first the pro- and anti-Haftar crowds mostly throw water bottles and taunts at each other. Both sides chant the same slogans. “The blood of the martyrs […]

Posted On : Published By : Tom Whipple
Category:

Fighting in Tripoli Starts Fire in Fuel Complex Near Airport

Fighting between rival militia in Tripoli Sunday caused a storage tank containing petroleum fuel to catch fire at a complex near the Tripoli airport, oil and security officials in the Libyan capital said. A "tank containing 6.6 million liters of petrol" caught fire late Sunday as a result of fighting between rival militia vying for the control of Tripoli airport, one oil official said. The complex where the storage tank is located contains 90 million liters of fuel and cooking gas, sparking a risk of massive explosion, the official said The news comes after escalating violence led to the evacuation of the U.S. Embassy in Tripoli Saturday. Libya’s Ministry of Interior, which showed pictures of fire brigades trying to put down the fire on its Facebook page, said it was asking residents to leave the area. The news comes as Libya’s Ministry of Health said Sunday that the death […]

Posted On : Published By : Tom Whipple
Category:

Libya warns of 'humanitarian disaster' over fuel fire

The Libyan authorities have called for a ceasefire to allow firefighters to tackle the blaze Continue reading the main story Libya has requested international assistance to put out a fire at a large fuel storage site in Tripoli that was hit by a rocket during militia clashes. The huge blaze could cause a "humanitarian and environmental disaster," the government has warned. It is the largest facility in Tripoli, containing 6.6 million litres of fuel. At least 97 people have been killed in fighting between rival militia groups battling for control of Tripoli’s main airport in the past week. Fighting in the eastern city of Benghazi has also intensified, with at least 38 people killed in clashes between troops loyal to the Libyan government and Islamist fighters on Sunday. Calls for evacuation A statement by the prime minister’s office said it had requested international assistance "as a precaution". "Several countries […]

Posted On : Published By : Tom Whipple
Category:

Libya warns of ‘humanitarian disaster’ over fuel fire

The Libyan authorities have called for a ceasefire to allow firefighters to tackle the blaze Continue reading the main story Libya has requested international assistance to put out a fire at a large fuel storage site in Tripoli that was hit by a rocket during militia clashes. The huge blaze could cause a "humanitarian and environmental disaster," the government has warned. It is the largest facility in Tripoli, containing 6.6 million litres of fuel. At least 97 people have been killed in fighting between rival militia groups battling for control of Tripoli’s main airport in the past week. Fighting in the eastern city of Benghazi has also intensified, with at least 38 people killed in clashes between troops loyal to the Libyan government and Islamist fighters on Sunday. Calls for evacuation A statement by the prime minister’s office said it had requested international assistance "as a precaution". "Several countries […]

Posted On : Published By : Tom Whipple
Category:

Syria's Assad prays as his troops suffer high toll

Syrian state media have shown President Bashar Assad praying in Damascus at the start of a major Muslim holiday amid reports of an unprecedented high toll among his troops battling Islamic extremists. State TV showed Assad performing prayers in Damascus’ Khair mosque early Monday. The Britain-based Syrian Observatory for Human Rights says about 1,240 soldiers and other Assad loyalists have been killed in the past 10 days, mostly in fierce battles with fighters from the al-Qaida-breakaway Islamic State group and other rebels in northern Syria. The dead soldiers and allied militiamen are among more than 1,800 people reportedly killed in the same period – a record number of deaths since the uprising against Assad began in March 2011. Syria’s three-year civil war has so far killed more than 170,000 people.

Posted On : Published By : Tom Whipple
Category:

Syria’s Assad prays as his troops suffer high toll

Syrian state media have shown President Bashar Assad praying in Damascus at the start of a major Muslim holiday amid reports of an unprecedented high toll among his troops battling Islamic extremists. State TV showed Assad performing prayers in Damascus’ Khair mosque early Monday. The Britain-based Syrian Observatory for Human Rights says about 1,240 soldiers and other Assad loyalists have been killed in the past 10 days, mostly in fierce battles with fighters from the al-Qaida-breakaway Islamic State group and other rebels in northern Syria. The dead soldiers and allied militiamen are among more than 1,800 people reportedly killed in the same period – a record number of deaths since the uprising against Assad began in March 2011. Syria’s three-year civil war has so far killed more than 170,000 people.

Posted On : Published By : Tom Whipple
Category:

Syrian army retakes gas field from fighters

The Syrian army has recaptured a gas field east of the central city of Homs that was seized by fighters from Islamic State earlier this month, according to state media and opposition activists. Syrian television showed footage of soldiers running and deploying in a vast desert area which it said was the Shaer gas field in the desert region of Palmyra. Mahmoud al-Homsi, an activist opposed to President Bashar al-Assad’s government, confirmed to Al Jazeera via Skype from Homs that the army was now in control of the field. The Syrian army, in a statement on Sunday, said it retook the field after a "precise operation in which dozens of terrorists were killed". However, a source from the Islamic State said the fighters pulled out after destroying the gas field’s equipment and capturing at least 15 tanks and dozens of rockets which were used to guard the facility. "We […]

Posted On : Published By : Tom Whipple
Category:

Australian Repeal Deals Blow to Global Carbon-Emission Plans

GDF Suez Australian Energy’s Hazelwood coal-fired power station in Morwell, Australia. Bloomberg News Australia’s repeal of a pioneering tax on carbon emissions has dealt a sharp blow to struggling international efforts to coordinate on global warming and comes ahead of key climate-change talks next year. On July 17, Australia’s parliament pulled the plug on the 2012 tax, which charged 348 businesses such as steelmakers and power companies A$25.40 (US$24) per ton of carbon dioxide emitted. The levy was slated to evolve next year into an emissions-trading system that would link to the European Union’s. Although environmentalists world-wide applauded the program, Australian consumers and corporations bitterly protested the added costs, with Prime Minister Tony Abbott saying it sucked A$9 billion off economic growth each year. Scrapping the program further isolates the EU and other countries that have plowed ahead with strict measures to limit carbon emissions and that have been […]

Posted On : Published By : Tom Whipple