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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
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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 […]

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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
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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
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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
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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 […]

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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 […]

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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 […]

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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
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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