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Ukraine fears frozen conflict could yield winter energy crisis

An elderly man walks near snow covered cars during a heavy storm in the Ukraine capital Kiev on March 23, 2013. Kiev administration declared a state of emergency in the city. AFP PHOTO/SERGEI SUPINSKY (Photo credit should read SERGEI SUPINSKY/AFP/Getty Images) ©AFP At the Foxtrot appliance store in Kiev, the must-have product these days is a Delonghi electric heater. “This is the last one left of 20 delivered to our store just a day ago,” Oleksander, a sales clerk, said, pointing to one of the Italian-made devices and noting that sales have increased fivefold from a year ago. More On this story Russia’s defence budget hit by slowdown Energy Can Europe wean itself off Russian gas? Risto Penttila Sanctions hurt everyone Drones plan to monitor Ukraine ceasefire On this topic Hungary halts flow of gas to Ukraine Spain’s EC nominee sells oil holdings Ukraine gas deadlock poses threat to […]

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Lockheed says makes breakthrough on fusion energy project

WASHINGTON (Reuters) – Lockheed Martin Corp said on Wednesday it had made a technological breakthrough in developing a power source based on nuclear fusion, and the first reactors, small enough to fit on the back of a truck, could be ready for use in a decade. Tom McGuire, who heads the project, said he and a small team had been working on fusion energy at Lockheed’s secretive Skunk Works for about four years, but were now going public to find potential partners in industry and government for their work. Initial work demonstrated the feasibility of building a 100-megawatt reactor measuring seven feet by 10 feet, which could fit on the back of a large truck, and is about 10 times smaller than current reactors, McGuire told reporters. In a statement, the company, the Pentagon’s largest supplier, said it would build and test a compact fusion reactor in less than […]

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U.S. fusion plan draws blistering critique

4581 Votes U.S. fusion plan draws blistering critique Many U.S. fusion scientists are blasting a report that seeks to map out a 10-year strategic plan for their field , calling it “flawed,” “unsatisfactory,” and the product of a rushed process rife with potential conflicts of interest. One result: Last week, most members of a 23-person government advisory panel had to recuse themselves from voting on the report as a result of potential conflicts. “The whole process was unsatisfactory,” says Martin Greenwald of the Massachusetts Institute of Technology’s (MIT’s) Plasma Science and Fusion Center in Cambridge. Achieving fusion—nuclear reactions that have the potential to produce copious, clean energy—requires heating hydrogen fuel to more than 100 million degrees Celsius, causing it to become an ionized gas or plasma. Huge and expensive reactors are needed to contain the superhot plasma long enough for reactions to start. The largest current fusion effort is […]

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Oil Trades at Multi-Year Lows, WTI Hovers at $82/bbl

By Eric Yep Oil markets traded near multi-year lows in Asian trading hours Wednesday after posting huge overnight losses as cuts in demand forecasts compounded concerns over excess supply. On the New York Mercantile Exchange, light, sweet crude futures for delivery in November traded at $82.13 a barrel at 0522 GMT, up $0.29 in the Globex electronic session. November Brent crude on London’s ICE Futures exchange rose $0.34 to $85.38 a barrel. Nymex West Texas Intermediate crude lost 4.55% in overnight floor trade, its sharpest decline since November 2012, and Brent crude lost 4.33%, its largest one-day percentage decline since September 2011. The sharp drop indicates signs of capitulation, with the bulls throwing in the towel and the few remaining buyers backing out of the market to see how low oil prices will go, analyst Tim Evans at Citi Futures said in a report. "It may take some consolidation […]

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Brent Crude Extends Biggest One-Day Plunge Since ’11 on Glut

Brent crude extended its biggest one-day collapse in four years amid speculation OPEC will refrain from eliminating a glut while demand growth slows to its lowest since 2009. Brent slumped as much as 2 percent to $83.37 a barrel on the ICE Futures Europe exchange in London. Yesterday it plunged 4.3 percent, the biggest one-day drop since September 2011. Global oil demand will rise by 650,000 barrels a day this year, the Paris-based agency said in its monthly report yesterday. That’s a reduction of 250,000 from a prior projection. “The market is currently in a state of panic as no one is prepared to put a hand under it,” Ole Sloth Hansen, an analyst at Saxo Bank A/S in Copenhagen, said by e-mail. Brent for November settlement, which expires tomorrow, was $1.33 lower at $83.71 a barrel on the London-based ICE Futures Europe exchange as of 9:03 a.m. local […]

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OPEC Finding U.S. Shale Harder to Crack as Rout Deepens

OPEC is resisting pressure to cut oil production while demand slumps as it tests how low prices must go to make U.S. shale oil unprofitable. As producers become more efficient, that floor is sinking. The Organization of Petroleum Exporting Countries boosted output by the most in 13 months in September, even as crude plunged into a bear market and demand growth weakens to a five-year low, according to the International Energy Agency . Saudi Arabia and Kuwait , the largest and third-largest members of OPEC, indicated the price slump doesn’t warrant immediate production cuts, the IEA said. While OPEC acted as a “swing producer” over the past decade, responding to surpluses by cutting output, it’s now letting oil slide to see if North American production can withstand lower prices, said Antoine Halff , head of the IEA’s oil industry and markets division. So far drillers are showing no signs […]

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Oil prices plunge as production rises, fueling concern in OPEC

An oil pump works at sunset in the desert oil fields of Sakhir, Bahrain, on Tuesday. (Hasan Jamali/AP) The roller-coaster ride of oil prices is speeding downward, carrying with it bickering members of OPEC, anxious U.S. shale oil producers and a Russia that relies heavily on petroleum revenue. With a weak global economy, the customary swing producer of oil — Saudi Arabia — has cut prices instead of cutting production, setting off a scramble on world markets. Crude oil prices have tumbled more than 23 percent since June, including a more than 4 percent drop Tuesday. Prices fell below four-year lows to wind up at $81.84 a barrel for the benchmark grade, West Texas Intermediate. A tidal wave of revenue has shifted with plunging prices. About $200 billion that would have flowed into the coffers of the Organization of the Petroleum Exporting Countries has instead remained in the hands […]

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NYMEX November gas settles 10 cents lower at $3.816/MMBtu

Knoxville, Tennessee (Platts)–14Oct2014/413 pm EDT/2013 GMT NYMEX November natural gas futures settled 10 cents lower at $3.816/MMBtu Tuesday, with analysts citing expectations for a strong storage injection, the absence of significant heating demand and spillover from falling crude prices. "We’re expecting another large injection this week, and so far we haven’t seen any real cold weather," said Tom Saal, broker at INTL FC Stone. Early estimates in the 90-Bcf range were circulating ahead of the US Energy Information Administration weekly storage report on Thursday, Saal said, compared with the five-year average build of 78 Bcf. "That’s the big reason for today’s selloff," he said. Article continues below… Sign up to Natural Gas Alert today. Platts Natural Gas Alert provides global coverage of the major natural gas and LNG markets, including real-time spot market transactions reported as deals are done and key end-of-day crude and product assessments. Other analysts said […]

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Natural-Gas Prices Fall on Soft Demand Outlook

By Timothy Puko Natural gas closed at a three-week low with comfortable weather and a soft demand outlook continuing to put pressure on prices. The front-month November contract settled down 10 cents, or 2.3%, to $3.816 a million British thermal units on the New York Mercantile Exchange. It equaled the closing price of Sept. 23, the lowest close from the past month. One trader was trying to unload put options Tuesday morning and that eventually prompted a flat market to turn downward, said Michael Doyle, a broker at Eclipse International Inc. in New York. "The weather is going to get warmer now, so when that happened, nobody was stepping up to take what was coming through," Mr. Doyle said. Unseasonably warm weather is going to cover most of the country through the end of the month, according to MDA Weather Services. It forecasts temperatures as much as 15-degrees-Fahrenheit above […]

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Crude price fall unlikely to hit shale production

Steeper drops in the price of oil are needed for US shale and other unconventional production to take a meaningful hit, the International Energy Agency said on Tuesday. Although an oil price slump since June has cast doubt on the sustainability of current high supply growth rates, the energy watchdog for wealthy nations said in its closely watched monthly report that a “close analysis of light, tight oil supply suggests that most of it remains profitable at $80 a barrel.” Swelling supplies and faltering economic growth have led to slide in the price of Brent crude – the international oil benchmark – to four-year highs. ICE November Brent, which has fallen more than 20 per cent since mid June, dipped 31 cents to $88.58 in early Tuesday trading. Oil from deepwater reserves, oil sands, and particularly from North American shale – or “light, tight oil” – plays are widely […]

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Oil Dives $4 As Demand Dims, Shale Booms And OPEC Resists Cuts

NEW YORK, Oct 14 (Reuters) – Oil dived more than $4 a barrel on Tuesday, its biggest drop in more than two years as mounting evidence of slackening demand and unrelenting U.S. shale output left traders struggling to peg a floor for crude’s four-month rout. The abrupt acceleration of an over 26 percent slide in prices since June was triggered by three news items that epitomized the market’s turn: a downgrade in global oil consumption forecasts; projections for another big boost in shale oil; and reluctance by OPEC members to cut output. Brent crude for November fell $3.85 to settle at $85.04 a barrel after a late lurch lower knocked prices to below $85 a barrel for the first time since 2010. It was the biggest one-day drop since 2011. U.S. crude fell $3.90 a barrel to settle at $81.84, its biggest percentage fall in about two years. Oil […]

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Brent Falls to Lowest Since 2010 After IEA Cuts Forecast

Brent oil tumbled to the lowest level in almost four years and West Texas Intermediate slipped the most since 2012 after the International Energy Agency said oil demand will expand this year at the slowest pace since 2009. Futures dropped 4.3 percent to $85.04 a barrel in London and 4.6 percent to $81.84 in New York . Oil consumption will rise by about 650,000 barrels a day this year, 250,000 fewer than the prior estimate, the Paris-based agency said in a monthly report. U.S. crude supplies probably grew by 2.5 million barrels last week, according to a Bloomberg survey of analysts before a report from the Energy Information Administration on Oct. 16. Oil futures have collapsed into bear markets as shale supplies boost U.S. output to the most in almost 30 years and global demand weakens. The biggest producers in the Organization of Petroleum Exporting Countries are responding by […]

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Oil demand down, IEA says

Global oil demand faltering, International Energy Agency says. UPI/A.J. Sisco.. PARIS, Oct. 14 (UPI) — Lower economic growth expectations mean the forecast for global oil demand is down, but should recover in 2015, the International Energy Agency said Tuesday. The Paris-based IEA released its monthly market report for October, saying it cut its oil demand prediction for the year by 200,000 barrels per day from the previous month’s report to 92.4 million bpd. The IEA attributed the decline to lower economic growth . In its monthly report, the Organization of Petroleum Exporting Countries kept oil demand growth predictions steady at 1.05 million bpd for 2014. "Annual demand growth for 2014 is now projected at 700,000 bpd, rising tentatively to 1.1 million bpd in 2015 as the macroeconomic backdrop improves," IEA said in its forecast. OPEC last week said the global economy should grow by 0.6 percent next year to […]

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U.S. Airstrikes Cut Islamic State Oil Production by 70 Percent

4580 Votes It’s been a month since President Obama announced that the U.S. would engage in a sustained campaign of airstrikes against Islamic State, the militant Sunni rebellion in Syria and Iraq. The idea was to bomb Islamic State into nonexistence, which has proved difficult. Not only is the movement well-armed, battle-hardened, and deeply entrenched in much of Syria and northern Iraq, it’s also very well-financed, thanks to oil wells and refineries it’s been able to capture. By late June, Islamic State was raising as much as $2 million a day refining and smuggling oil, making it one of history’s wealthiest terrorist groups. Though the airstrikes have failed to keep Islamic State from advancing in the field, they have apparently succeeded in dismantling its sophisticated oil network, reducing the movement’s ability to make gasoline and diesel for its tanks and trucks and cutting off a vital source of funding. […]

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Saudis to Build Biggest Water Storage Project in Riyadh

National Water Co., the biggest water supplier in oil-rich Saudi Arabia , plans to build a 1.8 billion-riyal ($480 million) storage facility in its desert capital Riyadh. The 4.6 million-cubic-meter storage facility is part of the first phase of a project to “achieve a sustainable and secure water supply and meet the challenges of providing water-sector services” in the kingdom’s largest city, the state-owned company said today in an e-mail. The second phase of the biggest Saudi water-storage project will add 6 million cubic meters more of capacity at a cost of 2.6 billion riyals to serve the city’s 5 million residents. Chief Executive Officer Luay Al Musallam said last year that the Saudi state projects are part of a 51 billion-riyal water-resources investment in cities including Riyadh , Mecca and the port of Jeddah . This year alone, the government has allocated 16.6 billion riyals for desalination projects […]

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Exclusive: Privately, Saudis tell oil market- get used to lower prices

LONDON/NEW YORK (Reuters) – Saudi Arabia is quietly telling the oil market it would be comfortable with much lower oil prices for an extended period, a sharp shift in policy that may be aimed at slowing the expansion of rival producers including those in the U.S. shale patch. Some OPEC members including Venezuela are clamoring for production cuts to push oil prices back up above $100 a barrel. But Saudi officials have given a different message in meetings with investors and analysts: the kingdom, OPEC’s largest producer, will accept oil prices below $90 per barrel, and perhaps down to $80, for as long as a year or two, according to people who have been briefed on the recent conversations. The discussions, some in New York over the past week, offer the clearest sign yet that the kingdom is setting aside its longstanding de facto aim of holding prices at […]

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Rouhani: Iran’s oil sector recovering

Oil sector bright spot in Iranian economy, President Hassan Rouhani says. UPI /Monika Graff TEHRAN, Oct. 14 (UPI) — Iranian President Hassan Rouhani said Tuesday the oil sector was outpacing other parts of the economy since he took office in August last year. Rouhani said the Iranian economy shrank by 6.8 percent to 2.9 percent during the past two calendar years. Since taking office in August last year, the president said some sections of the economy were recovering . "The first sector that got out of stagnation last winter was oil," he said. "Oil exports have grown 13.7 percent [since then]." Assessment from the International Monetary Fund finds the Iranian economy was contracting, but at a slower pace than before. Sanctions imposed on the Iranian economy in response to a controversial nuclear program means oil exports are at about half of their 2.2 million barrel per day rate in […]

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Statoil finds more gas offshore Tanzania

Statoil announced gas find in Tanzania, one of East Africa’s emerging producers. UPI/Maryam Rahmanian STAVANGER, Norway, Oct. 14 (UPI) — A new natural gas discovery offshore Tanzania puts the total amount of reserves there at 21 trillion cubic feet, Norwegian energy company Statoil said Tuesday. Statoil and its joint venture partner, Exxon Mobil, announced the discovery of about 1.2 trillion cubic feet of natural gas in place at the Giligiliani-1 exploration well offshore Tanzania. The new discovery pushes the total of in-place gas reserves above the 20 trillion cubic feet mark. Nick Maden, regional exploration director for Statoil, said the discovery opens up additional drilling opportunities off the Tanzanian coast. In June, Statoil unveiled a discovery of about 3 trillion cubic feet of natural gas off the coast of Tanzania in the Piri prospect. With the latest find, the Norwegian company said it would move its Discoverer Americas drill […]

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China starts oil production in South China Sea

China expects South China Sea field to reach peak production within three years.. UPI/A.J. SiscoUPI/A.J. Sisco.. BEIJING, Oct. 14 (UPI) — China National Oil Co. said its latest startup in the South China Sea will reach a peak production rate of 40,000 barrels per day within three years. CNOOC said it started production at the Enping 24-2 field in the shallow waters in the Pearl River basin of the South China Sea. "Currently there are two wells producing approximately 8,000 bpd, and the project is expected to reach its peak production of approximately 40,000 bpd in 2017," the company declared Monday. CNOOC is trying to reverse sagging production from mature fields. During the first half of the year, production from the Bohai Bay, which accounts for more than half of all Chinese production, declined 2.5 percent from last year to 411,000 barrels of oil equivalent per day. The pace […]

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Gazprom: All pieces in place for Chinese pipeline

All documents in place for Power of Siberia natural gas pipeline, Russian energy company Gazprom says. UPI/Hamid Forotan. MOSCOW, Oct. 14 (UPI) — All of the documents needed to proceed with the Power of Siberia natural gas pipeline to China are in place, the head of Russian gas company Gazprom said. Gazprom Chairman Alexei Miller met in Moscow with Wong Dongjin, the vice president of China National Petroleum Corp., to sign the final agreements on the 2,500 gas pipeline . "All the necessary documents on gas supplies to China have been signed, including the intergovernmental agreement," Miller said in a statement. "The construction of Power of Siberia is in full swing." The pipeline is part of Gazprom’s effort to pivot away from a stagnant European market toward emerging Asia. In May, Gazprom and CNPC signed a 30-year sales agreement that calls for 1.3 trillion cubic feet of natural gas […]

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Wind Power Is Cheaper Than Coal, Leaked Report Shows

It’s clear that fossil fuel industries have been pursuing the latter strategy for quite some time now. But as awareness of the true costs of climate change and air pollution grows, this position becomes increasingly precarious. The latest indication that things must change comes in the form of a European Union commissioned report—written about over at Recharge—which finds that onshore wind is the cheapest energy source of all , once externalities such as climate change impacts and health effects are taken into account. With onshore wind costs coming in at about €105 ($133) per MWh, this figure compares favorably to gas (€164/MWh), nuclear (€133) and, most dramatically, coal (€162-233). We should note that onshore wind also beats offshore wind (€186/MWh) and solar (€217) by a considerable margin. However, while the cost of coal and other fossil fuels is likely to go up as supplies get harder to reach and […]

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New York Gets Frigid Winter Warning From Siberia Snowfall

The snow in Siberia is piling up, and if it keeps coming, people in New York may have to bundle up this winter. There’s a theory that the amount of snow covering Eurasia in October is an indication of how much icy air will sweep down from the Arctic in December and January, pouring over parts of North America , Europe and East Asia . Last year, the snow level across Eurasia was the fourth highest for the month in records going back to 1967. In January, frigid temperatures dubbed “the polar vortex” slid out of the Arctic to freeze large portions of the U.S. It was a pattern that repeated itself during the Northern Hemisphere winter and helped make the first three months of this year the coldest in the 48 contiguous states since 1985, according to the National Climatic Data Center in Asheville, North Carolina . With […]

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Worrying for Saudi, U.S. oil output cuts could take a while

NEW YORK (Reuters) – Saudi Arabia effectively started a global oil price war this month aimed at quickly denting U.S. oil output. Slowing a U.S. drilling boom, however, could take more than a year. Many observers expect a downward spiral of global oil prices to rapidly dampen shale oil drilling in the United States, slow production growth and help bolster prices. Small producers vulnerable to sudden price moves may have to slow spending, fast reducing the amount of oil gushing to market. But even as drillers consider cutting budgets for 2015, output may continue to grow through next year and possibly into 2016, according to experts and industry insiders. Existing wells that are drilled but not yet fracked will keep output surging for months, they said. Many drillers have long-term rig contracts and are loathe to pay costly penalties for dropping equipment they could need soon after. Most have […]

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Drilling Productivity Report

New-well production per rig by region Production by region New-well oil production per rig barrels/day New-well gas production per rig thousand cubic feet/day Region October 2014 November 2014 change October 2014 November 2014 change Bakken 530 537 7 543 551 8 Eagle Ford 532 540 8 1,407 1,423 16 Haynesville 24 24 – 5,392 5,506 114 Marcellus 31 32 1 7,907 7,946 39 Niobrara 395 403 8 1,754 1,784 30 Permian 172 176 4 329 333 4 Utica 183 190 7 3,955 4,069 114 Rig-weighted average 311 315 4 1,568 1,613 45 The Drilling Productivity Report uses recent data on the total number of drilling rigs in operation along with estimates of drilling productivity and estimated changes in production from existing oil and natural gas wells to provide estimated changes in oil and natural gas production for seven key regions. EIA’s approach does not distinguish between oil-directed rigs and […]

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Bakken Drillers Poised to Curb Exploratory Spending

Bakken shale-oil producers are under pressure from tumbling prices to scale back their 2015 drilling plans in a region that accounts for one of every eight U.S. barrels of crude. Bakken oil fell 1 percent to $79.40 a barrel today, the first time it’s dropped below $80 in 11 months, according to data compiled by Bloomberg. Crude prices have been declining worldwide as ample North American supplies tempered the U.S. appetite for imports and Persian Gulf producers signaled they’re prepared to keep output high to protect their market shares in Asia . Companies drilling expensive, experimental wells in frontier regions such as the Tuscaloosa Marine Shale beneath Louisiana and Mississippi will be first to feel pinched by the drop-off in prices, said Gabriele Sorbara, an analyst at Topeka Capital Markets in New York . Bakken producers will soon feel the pain as well as their returns dwindle. “There is […]

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Permian Crudes Weaken After Crude Spill Shuts Sunoco Pipeline

Crude extracted from the largest U.S. oil field weakened against the U.S. benchmark after producers lost access to Midwest markets when a 4,000-barrel spill in Louisiana forced the shutdown of a key pipeline. West Texas Intermediate in Midland, Texas, weakened by 75 cents a barrel to a discount of $7 relative to the same grade in Cushing, Oklahoma, at 11:47 a.m., according to data compiled by Bloomberg. It’s the largest discount since Oct. 1. Midland is the pricing point for the Permian Basin, which produces about 1.76 million barrels of oil a day. Sunoco Logistics Partners LP (SXL) shut a segment of its Mid-Valley Pipeline between Longview, Texas, and Mayersville, Mississippi, after it spilled as much as 4,000 barrels of crude last night, Travis Lawson, a spokesman for the Philadelphia-based company, said by phone. The Mid-Valley line delivers Permian crude from Longview to six states, including Ohio and Michigan. […]

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Putin Loses His Best Friend: Expensive Oil

The decline in oil prices may be depriving Russian President Vladimir Putin of his biggest ally. Oil has been the key to Putin’s grip on power since he took over from Boris Yeltsin in 2000, fueling a booming economy that grew 7 percent on average from 2000 to 2008. Now, with economic growth slipping close to zero, Russia is reeling from sanctions by the U.S. and the European Union over its land grab in Ukraine, and from a ruble at a record low. Putin, whose popularity has been more than 80 percent in polls since the annexation of the Crimean Peninsula in March, may have less money to raise state pensions and wages, while companies hit by the sanctions also seek state aid to maintain spending. “His ratings remain high but for a person conducting such a risky policy, Putin has to understand the limits of patience for the […]

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U.S. Shale Oil Output Seen Growing Even as Prices Drop

Oil output is expected to grow in all major U.S. shale plays in November despite falling global prices as drillers become more efficient. Production per well was projected to increase in fields in North Dakota , Texas and Colorado , the Energy Information Administration said today in its Drilling Productivity Report . Brent futures fell to $85.04 a barrel on the ICE Futures Europe Exchange, the lowest settlement since Nov. 23, 2010. Only about 4 percent of U.S. shale oil production needs prices above $80 for drillers to break even, the International Energy Agency said today in its monthly oil market report. Producers are getting more oil per dollar spent drilling, driving costs down as much as $30 a barrel since 2012, Morgan Stanley (MS) analyst Adam Longson said in a report yesterday. “Prices aren’t low enough to put these projects at risk,” Matthew Jurecky, head of oil and […]

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Bakken Drillers Could Be Forced to Scale Back 2015 Efforts

ND Pump Jack | Click to Enlarge Bakken Shale oil producers are under pressure to scale back 2015 drilling plans due to falling oil prices, according to Bloomberg . On October 13th, Houston-based Plains Marketing L.P. listed Williston Basin sweet crude at $67.69, which is a ~$4 drop from last week’s price. Crude oil prices have been on the decline worldwide. Surging production from U.S. shale plays are one of the reasons behind the worldwide oil price drop. Other factors include a weakening global demand for oil and an increase in Libyan oil drilling over the summer, according to the Energy Information Administration (EIA) . North Dakota’s Department of Mineral Resources (DMR) Director Lynn Helms updated lawmakers on the status of oil & gas development in the state last week. Helms said two factors could negatively impact oil production – lower oil prices and new flaring regulations. Read more : Bakken Development Threats […]

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Oil Continues to Slide, WTI Hovers Around $85 a Barrel

By Eric Yep Crude-oil futures tumbled again in Asian trade Tuesday after posting new lows for the year in overnight trade. On the New York Mercantile Exchange, light, sweet crude futures for delivery in November traded at $85.07 a barrel at 0424 GMT, down $0.67 in the Globex electronic session. November Brent crude on London’s ICE Futures exchange fell $0.73 to $88.16 a barrel. Later Tuesday, the International Energy Agency will publish its monthly oil market report, while the more closely-watched weekly U.S. stockpile data are due Thursday. Market participants are increasingly of the view that much of the recent selloff is overdone and has been much steeper than warranted by weak demand and supply fundamentals. "The large downward move in oil over the past two weeks was mostly speculative, in our view. While the market remains oversupplied and lower OPEC production should be required, we see few signs […]

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WTI Extends Decline From 22-Month Low as Supply Gain Seen

Print Back to story West Texas Intermediate extended its rout from the lowest price in 22 months amid speculation that rising U.S. stockpiles are exacerbating a global glut that’s driven prices into a bear market. Brent fell in London. Futures dropped as much as 1.1 percent in New York, declining for the fifth time in six days. U.S. crude stockpiles probably expanded by 2.5 million barrels last week to 364.2 million, according to a Bloomberg News survey before a report from the Energy Information Administration on Oct. 16. That would be the highest level in two months. Oil futures have collapsed into bear markets as shale supplies boost U.S. output to the highest level in almost 30 years amid signs of weakening global demand. The biggest producers in the Organization of Petroleum Exporting Countries are responding by cutting prices, sparking speculation that they will compete for market share rather […]

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Natural Gas Futures Climb Despite Tepid Outlook

By Christian Berthelsen Natural gas futures rallied Monday on what analysts said were technical drivers and traders closing out bearish bets as prices rose. But futures remained well within the price range that has dominated for months amid mild weather-related demand and robust supply growth. Front-month November natural gas futures settled up 5.7 cents or 1.5% at $3.916 a million British thermal units on the New York Mercantile Exchange. Prices were choppy early in the session but turned positive mid-morning and rallied into the close. Analysts attributed the gains to the market remaining aloft after testing levels where it continued falling before. But the market remained well within the range that has prevailed since mid-summer, and analysts said there appeared to be little in the way of catalysts for it to break out of its recent pattern in the foreseeable future. "We’re not going anywhere, just waiting for winter […]

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Brent Near 4-Year Low as Iraq Follows Saudi Price Cuts

(Corrects date of EIA report in third paragraph before end.) Brent crude dropped to the lowest level in almost four years after Iraq followed Saudi Arabia and Iran in cutting prices. West Texas Intermediate’s discount to Brent narrowed. Iraq, OPEC’s second-biggest producer, will sell its Basrah Light crude to Asia at the biggest discount since January 2009, the country’s State Oil Marketing Co., known as SOMO, said yesterday. Iran last week said it will sell oil to Asia in November at the biggest discount in almost six years, matching cuts by Saudi Arabia. “OPEC is not ready to act and that’s making people continue to sell,” said Michael Lynch , president of Strategic Energy & Economic Research in Winchester, Massachusetts . “Until we see some comments out of OPEC suggesting they are going to stabilize the price, I think the market will probably keep falling.” Brent for November settlement […]

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Oil fell for a third month straight in September with Brent breaking through $90/bbl in October

Oil fell for a third month straight in September with Brent breaking through $90/bbl in October , on abundant supply, slowing demand growth and a strong US dollar. Brent prices have fallen by over 20% since June, when turmoil in Iraq lifted prices to $116/bbl, and were last at a near four-year low of $88.70/bbl. NYMEX WTI was at $85.20/bbl.   The forecast of global oil demand for 2014 has been revised 0.2 mb/d lower since last month’s Report, to 92.4 mb/d, on reduced expectations of economic growth and the weak recent trend. Annual demand growth is now projected at 0.7 mb/d in 2014, rising tentatively to 1.1 mb/d in 2015, as the macroeconomic backdrop improves.   Global supply rose by almost 910 kb/d in September to 93.8 mb/d, on higher OPEC and non-OPEC output. Compared with a year earlier, total supply stood 2.8 mb/d higher, as OPEC supply swung back to growth and amplified robust […]

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OPEC Split as Oil Prices Fall Sharply

Oil prices sank again on Monday, giving consumers more of a break and causing a split among OPEC leaders about what action should be taken, if any, to halt the slide. The price drop has led to a near free fall in gasoline prices in the United States. On Monday, the national average price for regular gasoline was $3.20, 9 cents lower than it was a week ago and 14 cents below the price a year ago, according to the AAA motor club. The price at the pump generally follows oil after a few days, leading energy experts to predict lower prices for the rest of the month at least. “This is not your garden variety autumn price decline,” said Tom Kloza, chief oil analyst at GasBuddy.com, which reports fuel prices from filling stations across the country. “Clearly there is a rift in OPEC , and that means we […]

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IEA 2014 Oil Demand Growth Forecast Weakest Since 2009

By Sarah Kent LONDON–The International Energy Agency on Tuesday cut its 2014 oil demand growth forecast to its weakest in five years, sending another bearish signal to the market as oil prices continue to tumble. In its closely watched monthly oil market report, the Paris-based energy watchdog cut its forecast for the amount it expects oil demand to increase this year by 200,000 barrels a day to just 700,000 barrels a day. Oil prices have tanked since June amid concerns over sluggish demand in a weak global economy coupled with healthy supply growth. However, the IEA said the weakness in demand growth may have reached its bottom. The organization sees demand picking up more next year, to increase by 1.1 million barrels a day. In fact, the glut in oil supply could prove more significant in sustaining market weakness. Oil production surged last month, due in part to a […]

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Crude price fall unlikely to hit shale production

Steeper drops in the price of oil are needed for US shale and other unconventional production to take a meaningful hit, the International Energy Agency said on Tuesday. Although an oil price slump since June has cast doubt on the sustainability of current high supply growth rates, the energy watchdog for wealthy nations said in its closely watched monthly report that a “close analysis of light, tight oil supply suggests that most of it remains profitable at $80 a barrel.” Swelling supplies and faltering economic growth have led to slide in the price of Brent crude – the international oil benchmark – to four-year highs. ICE November Brent, which has fallen more than 20 per cent since mid June, dipped 31 cents to $88.58 in early Tuesday trading. Oil from deepwater reserves, oil sands, and particularly from North American shale – or “light, tight oil” – plays are widely […]

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IEA says recent oil price fall casts doubt on sustainability of high supply

London (Platts)–14Oct2014/458 am EDT/858 GMT The International Energy Agency on Tuesday said the recent oil price decline is casting doubt on the sustainability of current high supply growth rates, but also said that most tight oil production in the US would still be profitable at a Brent oil price of $80/b. Brent crude futures have fallen by 20% since June, and this week fell below $88/b to near four-year lows. There have been suggestions that unconventional oil production in the US could cease to be economical if the price were to fall much lower, and a Saudi official recently suggested that the high cost of shale oil might put a floor under prices around $90/b. "Close analysis of light, tight oil supply suggests that most of it remains profitable at $80/b Brent," the IEA said in its latest monthly report. Article continues below… Request a free trial of: Oilgram […]

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IEA Chief: Oil Price Slump Yet To Hit US Shale Oil Production

LONDON, Oct 13 (Reuters) – The vast majority of shale oil in the United States is produced at costs far below the current price of crude, the head of the west’s energy watchdog said, which means U.S. projects can withstand the market slump squeezing other producers. Brent oil stands at around $88 per barrel, down more than 23 percent from the year’s peak above $115 in June, raising concern that some shale oil projects will become un-economic. However Maria van der Hoeven, executive director of the International Energy Agency said that only a tiny minority of shale oil production would be affected by the slump in prices to near-four-year lows. "Some 98 percent of crude oil and condensates from the United States have a breakeven price of below $80 and 82 percent had a breakeven price of $60 or lower," she told Reuters in an interview on the sidelines […]

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Israel Sees Gas as Key to Transforming Mideast Relations

After this summer’s war in Gaza battered Israel ’s international reputation, the country’s leaders say they have a new foreign policy tool to build relations with its neighbors: natural gas. By the the end of the year, Israel may have binding agreements to sell billions of dollars of gas to Egypt , Jordan and the Palestinian Authority . Preliminary talks are taking place with customers in Turkey , even though President Recep Tayyip Erdogan is among Israel’s fiercest critics. Gas may even help improve relationships in the Gaza Strip . “There are now extraordinary opportunities for Israel based on energy policy , both economically and diplomatically,” said Israeli Foreign Ministry spokesman Emmanuel Nachshon. “This is a real game-changer of common interests and benefits for many actors in the region. It could also bring about better relations with Turkey, and with other regional actors with whom Israel is not yet […]

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Amnesty: Iraqi Shiites retaliating against Sunnis

BAGHDAD (AP) — Amnesty International says Iraq’s Shiite militias have abducted and killed "scores" of Sunni civilians in retaliation for the onslaught of the Sunni militant Islamic State group. The rights watchdog says these attacks are supported by Iraq’s government, and that the Shiites are not prosecuted for their crimes. Amnesty’s senior adviser Donatella Rovera is accusing the Shiite-led government in Baghdad of "sanctioning war crimes and fueling a dangerous cycle of sectarian violence that is tearing the country apart." Amnesty says the fate of many of the Sunni abductees remains unknown and that some captives have been killed even after their families paid ransoms of $80,000 and more. The accusations, based on interviews with families and survivors, came in a new Amnesty report released Tuesday, entitled "Absolute Impunity: Militia Rule in Iraq."

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Iraq reviews oil ties with United States

Iraq calls on U.S. companies to stay invested in nation’s oil sector. (Michael Kleinfeld/UPI) Iraqi Oil Minister Adel Abdul Mahdi met U.S. Ambassador to Iraq Stuart Jones in Baghdad to discuss progress in the Iraqi oil sector . The oil minister’s office said Sunday he stressed that U.S. energy companies need to stay invested in Iraq, especially in the oil sector. The Organization of Petroleum Exporting Countries said member state Iraq produced 3.16 million barrels of oil per day in September, up 4.4 percent from the previous month. Much of Iraq’s oil sector has been spared from violence from the insurgency waged by the Sunni-led group calling itself the Islamic State. Most of the export terminals in Iraq are in the south of the country, far away from the territory controlled by the terrorist group. U.S. officials, meanwhile, have stayed in Baghdad’s corner in a spat with the semiautonomous […]

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Kurds to join Cabinet despite deadlock

Former Foreign Minister Hoshyar Zebari is slated to head Iraq’s Finance Ministry. (THAIER AL-SUDANI/Reuters) Kurdish political leaders agreed Monday to participate in Iraqi Prime Minister Haider al-Abadi’s government, abandoning their determination to extract key policy demands before taking up posts in the federal Cabinet.Hoshyar Zebari, formerly Iraq’s Foreign Minister, will head the Ministry of Finance; Rowsch Shaways will continue to serve as one of three deputy prime ministers; and Fryad Rawanduzi will lead the Ministry of Culture. Three other ministries have been earmarked for other Kurdish p… This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

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One Of The World’s Biggest Oil Projects Is A Total Fiasco

4579 Votes REUTERS/Anatoly UstinenkoAn aerial view shows artificial islands on Kashagan offshore oil field in the Caspian sea, western Kazakhstan, April 7, 2013. Picture taken April 7, 2013. WHEN it was discovered in 2000, the Kashagan oilfield in Kazakhstan’s waters in the northern Caspian Sea was the world’s biggest oil find in three decades. By now it was supposed to be pumping out 1.2m barrels a day (mbd), enough to meet Spain’s entire consumption. But the project, whose name sounds unfortunately like “cash all gone”, went spectacularly awry. A year ago, when the first trickle of crude briefly flowed, it was already eight years behind schedule. Having cost $43 billion, it was $30 billion over budget. And production lasted only a few weeks before leaks of poisonous gas forced its suspension. Earlier this month a government minister admitted it would not restart until at least 2016. Undeterred by the […]

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Saudi Arabia’s “Oil-Weapon” Hits Europe

Saudi Arabia’s “Oil-Weapon” Hits Europe We first exposed the “secret” US-Saudi deal in September which led to the inevitable bombing of Syria . We then progressed to explain the quid pro quo of the deal in lower oil prices (benefiting US consumers into an election and crushing Russian revenues) . In today’s Wall Street Journal we get the final piece of the puzzle as it is clear that what Saudi Arabia loses in ‘price’ it will make up in ‘volume’ as The Kingdon is taking the unusual step of asking buyers to commit to maximum shipments if they want to get its crude. Simply put, “ they are threatening [European] buyers” to discontinue sales if they don’t agree with the full fixed deliveries . The ‘oil weapon’ grows stronger… As The Wall Street Journal explains, Days after slashing prices in Asia, Saudi Arabia is now making an aggressive push […]

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