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Cash-Burning Bets on Oil Rebound Surge in U.S. ETF Market

Print Back to story While calling a bottom in oil is proving a tricky, and costly, exercise for contrarian investors, they are undeterred. After pouring the most money into funds that track oil prices in two years last month, investors are ramping up the bet even further this month, moving cash in at twice the October pace. The four biggest U.S. exchange-traded products tied to oil had 70.5 million shares outstanding yesterday, the most since May 2013, according to exchange data compiled by Bloomberg. More than 1 million shares in the ETFs are being created on average each day this month, the result of soaring demand. The trade has gone terribly since investors first started adding to oil ETF positions at the start of October. West Texas Intermediate, the U.S. crude benchmark, has tumbled 15 percent over that time, swelling its selloff since a June peak to 28 percent […]

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Crude oil prices recoil after OPEC report

Oil markets fall after release of the OPEC monthly market report. UPI/John Angelillo The Organization of Petroleum Exporting Countries said in its November market report output from its members declined by 230,000 barrels per day as production from North America cuts into imports. The price for the 12 crude oil blends that make up the reference basket from OPEC members was $77.27 per barrel, down more than 10 percent from one month ago. Though OPEC output declines, the organization said non-OPEC producers add another 1.68 million barrels per day this year, with the United States, Canada, Brazil and China contributing to the gains. By next year, non-OPEC supply grows by another 1.24 million bpd. "Demand for OPEC crude is estimated at 29.5 million bpd in 2014," the market report said. "In 2015, required OPEC crude is seen averaging 29.2 million bpd." Brent, the global price benchmark, traded down more […]

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Natural Gas Futures Keep Dropping as Weather Forecast Warms

By Timothy Puko Natural gas futures extended their retreat to a third session Wednesday as forecasts show a widespread cold snap starting to dissipate in about two weeks. Natural gas for December delivery fell 7.1 cents, or 1.7%, to $4.176 a million British thermal units on the New York Mercantile Exchange. Without an even more sustained cold spell to drive heating demand, traders have to pull back from a rally that raised prices more than 20% to start November, analysts said. "Colder than normal [temperatures] this time of the year are not nearly as strong as colder than normal temperatures hitting during the heart of the winter heating season," Dominick Chirichella, analyst at the Energy Management Institute, said in a note. The market had soared as the first strong burst of winter-like weather showed up in November forecasts, with a swath of frigid temperatures appearing over the Plains and […]

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Lower US natural gas prices expected following strong build in inventories

Home | News & Analysis | Latest News Headlines | Lower US natural gas prices expected following strong build in inventories Washington (Platts)–12Nov2014/538 pm EST/2238 GMT Although the US will head into the winter with smaller natural gas inventories than in past years, natural gas prices are expected to remain relatively low as long as weather forecasts for "normal" winter temperatures hold true, the US Energy Information Administration said Wednesday. In its November Short-Term Energy Outlook, the EIA on Wednesday lowered its forecast for first quarter 2015 Henry Hub natural gas spot prices to $3.95/MMBtu, 5 cents below its estimate in October. The agency also lowered its fourth-quarter 2014 estimate by 3 cents to $3.98/MMBtu. EIA said in the report that spot prices would "rise slightly with winter heating demand" but otherwise stay low. It added that Henry Hub natural gas prices are projected to average $3.83/MMBtu in 2015. […]

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OPEC MOMR October Production Data

OPEC just published their November Monthly Oil Market Report  which contains crude only production data for all OPEC nations. The only big surprise was that everyone had declining production except Libya and Algeria, that is according to “secondary sources”. OPEC Secondary Sources I find it interesting that Venezuela has, for the last several months, refused to give OPEC their production data. All charts below are in the charts below are in thousand barrels per day with the last data point October 2014 and is based on OPEC’s “secondary sources”. I have decided to post all OPEC charts in this post. OPEC production declined 226,000 bpd. September production was revised only slightly, up 5,000 bpd. Algeria has stopped their decline, temporally at least. Not much news from Angola except that production was down 66,000 bpd in October. Ecuador which had been increasing production since 2010 now seems to have hit resistance. […]

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EIA: OPEC’s actions bring huge uncertainty on crude oil price forecast

HOUSTON, Nov. 12 11/12/2014 By OGJ editors Brent crude oil prices fell to $84/bbl at the end of October from $95/bbl at the beginning of the month. A handful of core drivers for this tumble include weakening outlooks for global economic and oil demand growth, the return to the market of previously disrupted Libyan crude oil production , and continued growth in US tight-oil production. In the most recently released Short-Term Energy Outlook , the US Energy Information Administration projects that Brent crude oil prices will average $83/bbl in 2015, $18/bbl lower than forecast in last month’s STEO. “There is significant uncertainty over the crude oil price forecast because of the range of potential supply responses from the Organization of Petroleum Exporting Countries, particularly Saudi Arabia, and US tight-oil producers to the new lower oil price environment,” EIA said. As noted by the outlook, Saudi Arabia’s role in the […]

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Saudi oil chief dismisses ‘price war’ claims

Pump jacks and wells are seen in an oil field on the Monterey Shale formation, California (Photo by David McNew/Getty Images) ©Getty Saudi Arabia’s oil minister broke months of silence on Wednesday to speak publicly about the Gulf nation’s stance on the oil market and dismiss claims that it had triggered a “price war”. Ali al-Naimi kept quiet on whether Saudi Arabia would cut output to remove surplus oil from the market in response to dramatically lower Brent crude prices, which are now around the $80 a barrel mark – a four-year low. But he said the country was working “with other producers to ensure price stability for the interest of producers, consumers and the industry at large”, according to Reuters. Oil market watchers have been holding out for comments from the minister of Opec’s largest producer ahead of a gathering of the cartel’s members later on this month. […]

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Saudis Reject Talk of OPEC Market Share War as Oil Slides

Related Brent Oil May Rise If OPEC Maintains Level: Goldman Saudi Arabia’s oil minister dismissed talk of a price war as having “no basis in reality” in his first public comments since crude plunged into a bear market last month. “Saudi oil policy has remained constant for the past few decades and it has not changed today,” Ali al-Naimi said at a conference in Acapulco , Mexico , yesterday. “We want stable oil markets and steady prices, because this is good for producers, consumers and investors.” Brent crude futures plunged below $80 yesterday for the first time since September 2010 on concern OPEC is in no hurry to halt a four-month slide in prices. Saudi discounts offered to Asian customers in October triggered speculation that the Organization of Petroleum Exporting Countries’ largest member had changed policy and was seeking to preserve market share, instead of supporting prices by curbing […]

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Sanctions, politics complicate Iran nuclear deal

An Iran nuclear deal remained elusive Tuesday after two days of talks in Oman between Secretary of State John Kerry, Iran’s Foreign Minister Javad Zarif and European Union foreign policy chief Catherine Ashton. Negotiators have only 13 days to meet a self-imposed Nov. 24 deadline for reaching agreement, with the U.S. midterm election results potentially raising new obstacles on the path of compromise. Despite Tehran’s  routinely dismissing President Barack Obama’s argument that sanctions pressure has forced Iran to the negotiating table, the timetable for and extent of sanctions relief has emerged as a key sticking point in the talks, according to Iranian officials and others who follow the negotiations closely. Iran seeks the early removal of U.N. Security Council penalties that undergird the harsh economic punishment imposed by much of the world against the Islamic Republic since 2006. The five permanent members of the Security Council plus Germany (the P5+1) […]

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Iraq Kurds Cabinet Approves Plan for Starting Oil Company

Iraq ’s semi-autonomous Kurdish government approved plans to create an oil exploration and production company separate from the central government and a sovereign wealth fund to take in all energy revenue. A bill to create the company for oil exploration and production, with shares to be sold to the public, was approved by the cabinet of the Kurdistan Regional Government, Kurdish Prime Minister Nechirvian Barzani said in a statement yesterday. A separate initiative approved by the cabinet would create a Kurdish fund for oil and gas revenue. Both draft laws need to be approved by the KRG’s parliament. The KRG, which started crude oil exports by pipeline through Turkey this year, wants to control sales of oil pumped from fields in the Kurdish region in the north of Iraq to boost its financial independence from the central government in Baghdad . The Kurdish region holds 45 billion barrels of […]

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Kurdistan exporting oil from disputed fields

A worker walks on an oil pipeline at the Khurmala Dome formation of the Kirkuk oil field on Dec. 13, 2013. (STRINGER/Reuters) Recommend 1,591 people recommend this. Sign Up to see what your friends recommend. Iraq’s autonomous Kurdistan Regional Government (KRG) is now exporting oil from fields it recently seized from federal authorities – a step that takes Kurdistan much closer to economic independence and farther away from political reconciliation with Baghdad.The KRG is pumping about 120,000 barrels per day (bpd) from two areas formerly controlled by the federal Oil Ministry’s North Oil Company (NOC) – the Avana Dome, which is one of the formations of the Kirkuk oil field, and the Bai Hassan … 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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EIA Slashes Oil-Price Forecasts for 2015

By Nicole Friedman NEW YORK–Government forecasters sharply lowered their projections for oil prices this year and next, reflecting higher global supply expectations. The U.S. Energy Information Administration, in its monthly short-term energy outlook released Wednesday, called for benchmark U.S. crude-oil prices to average $95 a barrel this year and $77.75 a barrel next year, below its previous forecasts of $97.72 a barrel this year and $94.58 a barrel next year. For Brent, the global benchmark, the EIA expects prices to average $101.04 a barrel in 2014 and $83.42 a barrel in 2015. In October, the agency called for price averages of $104.42 a barrel this year and $101.67 a barrel next year. Oil prices have plunged in recent months on concerns that the Organization of the Petroleum Exporting Countries won’t cut production in response to a global glut of oil. Front-month U.S. futures prices are currently trading around $77 […]

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Low gas prices translate to high consumer confidence

Cheap gasoline means more money for holiday spending, industry group finds. UPI/John Angelillo ALEXANDRIA, Va., Nov. 12 (UPI) — The National Association of Convenience stores said Wednesday less cash spent at the gas station should translate to more money going to holiday spending. NACS found consumer sentiment was buoyed by lower retail gasoline prices in the United States. It said that, for every 1 cent gas prices decline, U.S. consumers are saving a collective $3.7 million per day at the pump. In its survey of consumer optimism, the industry group found a high level of confidence going into the holiday season, which corresponds to the long trend downward for gasoline prices. Jeff Lenard, vice president for strategic initiatives at NACS, found low gas prices usually correspond with an upbeat consumer outlook . "However, declining gas prices alone may not take consumer sentiment much higher in the short term," he […]

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EIA: ‘Modest’ benefits from LNG exports

Positive, but limited, benefits seen coming from more exports of LNG from U.S. ports, analysis finds. UPI/A.J. Sisco WASHINGTON, Nov. 12 (UPI) — An increase in natural gas production from U.S. shale basins should support export growth, but the economic benefits will be modest, the government said. The U.S. Energy Information Administration said in a daily brief Wednesday the increase in U.S. natural gas production should support as much as 80 percent of the potential increase in demand resulting from the steady gains in exports of liquefied natural gas from the Lower 48 states. EIA in an analysis found LNG exports reach 2 billion cubic feet by next year, and eventually surge to as high as 20 billion cubic feet per day. In its study, EIA found the "effects on overall economic growth [from the emerging LNG market] were positive but modest." Construction began in Louisiana for the Cameron […]

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Short-Term Energy Outlook

Highlights North Sea Brent crude oil spot prices fell from $95/barrel (bbl) on October 1 to $84/bbl at the end of the month. The causes included weakening outlooks for global economic and oil demand growth, the return to the market of previously disrupted Libyan crude oil production, and continued growth in U.S. tight oil production. Brent crude oil spot prices averaged $87/bbl in October, the first month Brent prices have averaged below $90/bbl since November 2010. EIA projects that Brent crude oil prices will average $83/bbl in 2015, $18/bbl lower than forecast in last month’s STEO. There is significant uncertainty over the crude oil price forecast because of the range of potential supply responses from the Organization of the Petroleum Exporting Countries (OPEC), particularly Saudi Arabia, and U.S. tight oil producers to the new lower oil price environment. Driven largely by falling crude oil prices, U.S. weekly regular gasoline […]

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U.S. Retreat From Oil Investment in Asia Paves Way for Rivals

A pullback by U.S. energy companies from Asia is opening the door for competitors looking to snap up unwanted oil and gas assets in the region. U.S. producers are facing pressure to cut spending, reduce exposure overseas and focus on the domestic market, where oil production is forecast to reach the highest in 45 years in 2015. Apache Corp. (APA) and Murphy Oil Corp. (MUR) are among companies in disposal mode this year in the Asia-Pacific region. “The American companies in particular are struggling to continue to invest in the Asian economies,” David Knox, chief executive officer of Santos Ltd., said today in a Bloomberg Television interview in Brisbane before this weekend’s Group of 20 summit. “Their capital is being forced back home. That opens up opportunities for players like us who are committed to Asia.” Apache is looking to sell its interest in an Australian liquefied natural gas […]

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Offshore Drilling Companies Delay Projects Amid Oil Glut

By Dan Molinski Offshore drilling companies say they are mothballing or even scrapping some of their aging drilling rigs as energy companies respond to a global glut of oil that has sent prices tumbling. The moves by the companies that lease and operate drilling rigs are among the first concrete signs that the energy industry does not think the 25% price drop since June is temporary. "We’re not seeing a lot of opportunity on the horizon right now for 2015," said Terry Bonno, a senior vice president at Transocean Ltd., told analysts earlier this week. The company, which owns the world’s largest fleet of deepwater rigs, said it is junking some offshore rigs that are currently in storage, and writing down the value of some of its deep-water vessels. Transocean’s shares have fallen by more than 50% over the past 12 months, to $27, well under the lows they […]

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EIA Sees US Oil Output Growth Slowing Slightly; Cuts Price View

Nov 12 (Reuters) – U.S. domestic oil output will keep growing next year as slumping crude prices have not discouraged producers in fast-growing shale regions, the U.S. government said on Wednesday, but it trimmed its output forecast by about 100,000 barrels per day. The U.S. Energy Information Administration also said it expects Saudi Arabia to curb production. But it still cut its forecast for Brent crude prices in 2015 by $18 a barrel from last month’s view, to an average of $83 a barrel. Early Wednesday afternoon, December Brent crude was trading at $80.91 a barrel, down 76 cents. The EIA now expects U.S. production to rise by 850,000 bpd to around 9.4 million bpd, according to its monthly short-term energy outlook. A month ago it was forecasting a 960,000 bpd rise next year. It was a rare downgrade from the EIA, which like many forecasters has been consistently […]

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Early signs of a pullback in US oil drilling

Austin Mitchell walks away from an oil derrick outside of Williston, N.D. Lower oil prices, while good for the broader US economy, are a threat to what has been a surprising and dramatic surge in oil production in the US, and to drilling communities that have come to depend on oil money. Gregory Bull/AP/File View Caption With oil prices low and showing no sign of an immediate rebound, the industry is beginning to pull back on spending. Oil prices have dropped around  30 percent  since summer highs, raising fears among producers across the globe. Yet, many oil majors are relatively diversified, with large holdings downstream. For example, ExxonMobil and Chevron have been insulated in the third quarter because of their large holdings in refining. Steep declines in oil prices may hurt their production sectors, but with lower priced oil as an input, big oil’s refining assets become more profitable. […]

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Ukraine Tensions Rise as U.S., EU Weigh More Sanctions

The European Union and the U.S. will weigh further sanctions against Russia ’s economy and Ukrainian separatists, after the reported movement of tanks, artillery and combat troops into eastern Ukraine. Representatives of the EU’s 28 member states and the U.S. are meeting today in Brussels to discuss imposing new penalties on individuals or on the Russian economy for the country’s interference in Ukraine, according to diplomats close to the talks. While no consensus has been reached yet, officials will prepare options for an EU foreign ministers meeting in Brussels on Nov. 17, when the group could move to expand penalties, said the diplomats, who spoke on condition of anonymity because they weren’t authorized to be quoted. “The situation on the ground is very tense,” Ukrainian Foreign Minister Pavlo Klimkin said in an interview with Bloomberg Television today. Asked whether he expects an attack, Klimkin said: “We are of course […]

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Russian Troops Crossing Into Ukraine, NATO Says

KIEV, Ukraine — Tanks and other military vehicles towing heavy weapons pouring over the border from Russia into eastern Ukraine . Nightly artillery battles in the region’s biggest city, Donetsk, and reports of fighting around another regional capital. And now, sightings of the “green men,” professional soldiers in green uniforms without insignia, the same type of forces that carried out the invasion of Crimea in the spring. A senior NATO official confirmed on Wednesday what Ukrainian military officials and monitors from the Organization for Security and Cooperation in Europe have been saying for days now: Russian troops and military equipment are crossing the border into Ukraine, seemingly preparing for renewed military action, though what exactly remains unclear. The assertion drew stern and dismissive denials from Moscow, which for months has denied any military intervention in eastern Ukraine, though it has acknowledged publicly that Russian “volunteers” have crossed into Ukraine […]

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Kemp: Will The Saudis Drive US Shale Out Of Business

John Kemp is a Reuters market analyst. The views expressed are his own LONDON, Nov 12 (Reuters) – There has always been a close link between U.S. oil production, international prices and OPEC, so it should come as no surprise that North America’s shale drillers find themselves locked in a battle with Saudi Arabia over prices and market share. Until the 1950s, the United States accounted for more than half of all global oil production. Big finds such as Oklahoma’s Glenn Pool (1905) and the East Texas field (1930) drove oil price changes around the rest of the world. Since the 1970s, the United States has been a net importer, and international prices have tended to drive changes in U.S. exploration and production. Drilling and output in major oil-producing states have been closely correlated with the rise and fall in real oil prices. And nowhere has the relationship been […]

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US Oil Consumption and the US Tight Oil Boom

4708 Votes In part 1 of a series of articles on the impact of US tight (shale) oil we examine the impact on US oil consumption. Fig 1: US crude oil production with tight oil from Texas and North Dakota Data from:   http://www.eia.gov/dnav/pet/pet_crd_crpdn_adc_mbbl_a.htm In 2013, an additional 2.3 mb/d of tight oil was produced from wells in Texas (1.5 mb/d) and North Dakota (0.8 mb/d). Note that these data are preliminary estimates. Fig 2: Data from the Texas Rail Road Commission in barrels/day Graph from:   http://peakoilbarrel.com/texas-rrc-oil-gas-report-august-data/ The blue straight line is from the EIA  http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPTX2&f=M The other lines present the monthly  updates of the Texas RRC. We see it takes almost 2 years until numbers stabilize.  Around 1.1 mb/d is from conventional oil. Let’s have a look at US consumption by fuel: Fig 2: US annual petroleum consumption 1963-2014E Data from:   http://www.eia.gov/dnav/pet/pet_cons_psup_dc_nus_mbblpd_a.htm This graph shows: consumption growth […]

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Saudi Arabia is trying to sabotage America’s shale oil boom

4708 Votes Saudi Arabia is trying to sabotage America’s shale oil boom We’ve been here before. By “here,” I mean Saudi Arabia throwing its weight around in the global oil markets and triggering what we can only call a kind of reverse oil shock as a result. The consequences were particularly visible last Tuesday, when Saudi Arabia slashed the price at which it is willing to export crude oil to the United States, even as it boosted prices to buyers in Europe and Asia. That sent the benchmark U.S. crude oil price — West Texas Intermediate — skittering down to $76.45 a barrel, a level not reached in three years. Welcome back to the geopolitics of oil. If you thought that crude oil prices were set simply by what is happening to the global economy — the forces of supply and demand, and the answers to pressing questions such […]

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Bearish Market Sentiment Drives Oil Prices Lower

By Eric Yep Oil prices sunk deeper into negative territory in Asian trade Wednesday on perceived oversupply and concerns over whether oil producers will cut production to balance the market. On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $77.42 a barrel at 0534 GMT, down $0.52 in the Globex electronic session. December Brent crude on London’s ICE Futures exchange fell $0.51 to $81.16 a barrel. Brent crude, the global oil benchmark, extended overnight losses to fresh year-lows and has fallen by more than 29% from its 52-week high of $115.06 a barrel. There’s a growing crisis of confidence in the oil market given apparent willingness of the Organization of the Petroleum Exporting Countries to stand aside and allow the market to fall, Citi Futures analyst Tim Evans said. "The new lows in Brent prices imply that the market remains more concerned […]

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Brent Oil Near 4-Year Low on Signs OPEC Will Resist Output Cuts

Brent crude traded near its lowest close in four years amid signs that OPEC members are reluctant to reduce supply even as prices slumped deeper into a bear market. West Texas Intermediate dropped in New York. Futures slid as much as 1 percent in London. The oversupply in global markets “didn’t come from us,” Energy Minister Suhail Al Mazrouei said yesterday of the United Arab Emirates and the Organization of Petroleum Exporting Countries. Crude stockpiles in the U.S., the world’s biggest oil consumer, probably increased by 1.1 million barrels through Nov. 7 for a sixth weekly gain, a Bloomberg News survey shows before government data tomorrow. Brent has lost about 30 percent since its June peak amid speculation that global supply is outpacing demand. Leading OPEC members are resisting calls to cut output and instead reducing export prices to the U.S., where they’re competing with the fastest pace of […]

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Brent Oil Falls to Four-Year Low Amid OPEC Skepticism

Brent oil slid to a four-year low amid signs the Organization of Petroleum Exporting Countries isn’t prepared to tackle the global supply glut. West Texas Intermediate crude rose as the dollar fell against the euro. Futures fell 0.8 percent in London while WTI gained 0.7 percent. The oil market is oversupplied, partly because of rising U.S. output, United Arab Emirates Energy Minister Suhail Al Mazrouei said today in Abu Dhabi . OPEC members including Saudi Arabia and Iraq are resisting calls to curb output and instead cut export prices to the U.S., where production is running at the highest level in more than 30 years . The group meets later this month in Vienna. “There’s uncertainty about OPEC and whether it will or will not cut production at the Nov. 27 meeting,” Kyle Cooper , director of commodities research at IAF Advisors in Houston, said by phone. “They probably […]

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In New Oil Order, OPEC’s Choice Is Pricing Power or Sales

The decision OPEC faces at this month’s meeting isn’t just over whether to cut oil production. It’s a choice of whether the group is willing to fight to maintain the sway it has had over crude markets for decades. The Organization of Petroleum Exporting Countries, buffeted by plunging prices, could reassert control by cutting output, said Societe Generale SA, ceding more market share to U.S. shale oil producers. The alternative — waiting to see if lower prices choke off the North American shale boom — would usher in a “new oil order” where pricing power is handed to drillers in Texas and North Dakota , according to Goldman Sachs Group Inc. “We’ve not seen a turning point like this in decades,” Mike Wittner , Societe Generale’s head of oil market research in New York , said by phone yesterday. “Is OPEC going to abdicate its role in the market? […]

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IEA sees world oil demand rising to 104 million b/d in 2040 from 90 million b/d in 2013

Home | News & Analysis | Latest News Headlines | IEA sees world oil demand rising to 104 million b/d in 2040 from 90 million b/d in 2013 London (Platts)–12Nov2014/137 am EST/637 GMT The International Energy Agency has delivered a new warning about future supply of oil and gas as turmoil continues in the Middle East and the conflict between Russia and Ukraine remains unresolved. In its latest annual World Energy Outlook to be released later Wednesday, the Paris-based IEA said current ample supply of oil should not leave consumers complacent, especially given the increasing dependence on Middle East producers. "The short-term picture of a well-supplied oil market should not disguise the challenges that lie ahead as reliance grows on a relatively small number of producers," the IEA said, in an apparent reference to current expectations that rising supply will more than meet incremental world oil demand in the […]

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China Seen Overtaking U.S. as World’s Biggest Oil User

China will overtake the U.S. as the world’s biggest oil consumer within two decades, according to the International Energy Agency . “A landmark is reached in the early 2030s, when China becomes the largest oil-consuming country, crossing paths with the United States ,” the agency said in a summary of its World Energy Outlook, which forecasts long-term energy trends. The full findings of the report will be presented at a press conference in London today. Growth in oil demand to 2040 will also be driven by India, Southeast Asia, the Middle East and sub-Saharan Africa, the IEA said. Consumption in developed economies will shrink, with oil use in the U.S. falling to the lowest level in decades, it said. Brent crude fell to a four-year low yesterday and is trading in a bear market amid signs that global demand growth isn’t keeping pace with supply. Members of the Organization […]

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Russia wades deeper into Iranian nuclear waters

Director General of the International Atomic Energy Agency (IAEA) Yukiya Amano briefs reporters on nuclear negotiations with Iranian officials in Tehran, Iran, on Nov. 11, 2013. UPI File/Maryam Rahmanian The state-run Russian atomic energy corporation said an agreement was signed between the two countries to build four new power units at the Iranian nuclear facility at the existing plant at Bushehr. The agreement calls for "four similar power units on another site in Iran, which will be provided by the Iranian party later." The agreement comes as representatives from the so-called P5 +1 — Britain, China, France, Russia and the United States, plus Germany — are working from Oman on resolving a nuclear impasse with Iran. With a Nov. 24 deadline to reach a nuclear agreement looming , U.S. Secretary of State John Kerry said "the time is now" to make decisions on Iran’s controversial program. Western powers have […]

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Suicide bomber kills eight in northern Iraqi city Baiji

BAGHDAD (Reuters) – A suicide bomber killed eight people including six soldiers on Tuesday in the northern Iraqi city of Baiji where government forces are trying to reassert control to break an Islamic State siege of the country’s largest refinery nearby. The bomber targeted a crowd gathering around soldiers who had retaken parts of the city center, Baiji Mayor Mohammed Mahmoud told Reuters. Security officials said two civilians and six soldiers were killed. Islamic State insurgents seized much of northern Iraq five months ago in an offensive in which they took Baiji and surrounded the oil refinery, halting production and besieging a detachment of government troops there. U.S. air strikes have slowed down the radical Sunni Muslim insurgents and enabled Iraqi security forces to make some gains. Iraqi security forces have used helicopters to attack Islamic State fighters ringing the refinery. Months of operations have failed to rescue comrades […]

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U.A.E. Concerned That Oil Glut May Curb Exploration, Production

The collapse in oil prices may deter investment in exploration and production projects predicated on $100 crude, United Arab Emirates’ Energy Minister Suhail Al Mazrouei said. “What worries us is that some investors will not continue to invest,” Al Mazrouei told reporters today in Abu Dhabi. “Not us, others, are not going to continue to invest. And in a few years, we’re going to face difficulties finding enough investments in the market.” Oil has fallen into a bear market this year on increased output of U.S. shale and other supplies. The Organization of Petroleum Exporting Countries, including the U.A.E., will meet Nov. 27 to assess the market and production. Saudi Arabia and Kuwait have resisted calls for the group to cut output, while Libya, Venezuela and Ecuador have asked for action to keep prices from falling lower. Brent crude has tumbled 29 percent since June 19. “This isn’t the […]

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China and US in deal to curb emissions

(FILES) – This photo taken on July 18, 2006 shows cyclists passing through thick pollution from a factory in Yutian, 100km east of Beijing in China’s northwest Hebei province. Surging levels of carbon dioxide sent greenhouse gases in the atmosphere to a new record in 2013, while oceans, which absorb the emissions, have become more acidic than ever, the UN said on September 9, 2014. AFP PHOTO / PETER PARKS ©AFP China and the US have set aside nearly 20 years of discord over how to combat climate change and laid out their respective plans to curb greenhouse gas emissions. The unexpected joint announcement by US President Barack Obama and China’s President Xi Jinping in Beijing promises to galvanise efforts to seal a global climate pact at the end of next year in Paris. More On this story Martin Wolf An unethical bet in the climate casino Bill for […]

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U.S. and China Reach Climate Deal After Months of Talks

BEIJING — China and the United States made common cause on Wednesday against the threat of climate change , staking out an ambitious joint plan to curb carbon emissions as a way to spur nations around the world to make their own cuts in greenhouse gases. The landmark agreement, jointly announced here by President Obama and President Xi Jinping, includes new targets for carbon emissions reductions by the United States and a first-ever commitment by China to stop its emissions from growing by 2030. Administration officials said the agreement, which was worked out quietly between the United States and China over nine months and included a letter from Mr. Obama to Mr. Xi proposing a joint approach, could galvanize efforts to negotiate a new global climate agreement by 2015. It was the signature achievement of an unexpectedly productive two days of meetings between the leaders. Mr. Obama and Mr. […]

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U.S. Shale Boom Masks Threats to World Oil Supply, IEA Says

The U.S. shale boom masks threats to global oil supply including Middle East turmoil, conflict in Ukraine and the difficulty of unconventional oil production beyond North America , the International Energy Agency said. “The global energy system is in danger of falling short of the hopes and expectations placed upon it,” the IEA said in its annual World Energy Outlook today. “The short-term picture of a well-supplied oil market should not disguise the challenges that lie ahead as reliance grows on a relatively small number of producers.” Global oil consumption will rise to 104 million barrels a day in 2040 from 90 million barrels a day in 2013, driven by demand for transport fuel and petrochemicals in developing countries , the report said. To meet that growth and replace exhausted fields will require about $900 billion a year in investment by the 2030s as oil companies develop fields from […]

Posted On : Published By : Tom Whipple
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Hess Increases Bakken Production Guidance Through 2020

Hess Corp. Bakken Spacing Pilot Hess Corp., one of the top five Bakken producers, appears to be undeterred by lower oil prices, announcing plans to increase its five year production forecast this week. After a successful Bakken downspacing pilot program in 2014, Hess told investors it would increase its net peak production guidance in the play to ~175,000 boe/d by 2020. The increase means the company would add an additional 1,000 well locations to a total of more than 4,000. “Even at current prices, or below, there’s still many areas for attractive investment in the Bakken,” said CEO John Hess the company’s annual investor day on Monday. Hess told investors that he believes prices will rebound, and also pointed to drilling efficiency gains made in the Bakken that reduce the cost of drilling a Bakken well. Hess’ Tioga Gas Plant Expansion Project Paying Off At the beginning of the year, poor weather conditions delayed […]

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Wood Mackenzie: Oil exports hinge on U.S. political maneuvering

If nothing happens soon, politicking in Washington may push the debate on U.S. crude oil exports to 2017, analysis finds. UPI/Dennis Brack/Pool Wood Mackenzie says. U.S. crude oil exports are restricted under legislation enacted in response to the 1970s export embargo from Arab members of the Organization of Petroleum Exporting Countries. There are no restrictions on certain petroleum products like gasoline and some companies have recently started testing the moratorium with the export of condensate, an ultra light form of oil found in U.S. shale deposits. Harold York, an analyst of the refining sector at Wood Mackenzie, said condensate exports amount to a de facto ease on the restrictions, though, according to him, there are few "overt calls" from either side of the U.S. political aisle to lift the ban completely. Last week, Australian company BHP Billiton said it was the one that concluded oil products processed from the […]

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WTI price no deterrent in U.S. shale basins

West Texas Intermediate prices are still low, though energy reports show oil production should still increase in U.S. shale basins. ekina/Shutterstock NEW YORK, Nov. 11 (UPI) — The benchmark for U.S. crude oil prices was treading water in early Tuesday trading, one day after a report showed few signs of a slowdown in the shale boom. West Texas Intermediate for December delivery was still struggling to break the $80 per barrel mark in early trading Tuesday, though prices were relatively stable at $77.44 per barrel. Long-term traded contracts show WTI moving closer to the $78 mark through mid 2015. Crude oil is in a bear market, shedding about 20 percent of the price per barrel since June. Several energy companies and industry groups have cut their long-term investment forecasts because of the slump in oil prices. Market observers have said the downward trend is part of an effort by […]

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Canadian Heavy Oil Boosted as Imperial Shuts Kearl Operation

Canadian heavy oil strengthened the most in more than a month after Imperial Oil Ltd. (IMO) shut operations at its Kearl oil sands project. Operations were suspended after vibrations were detected in an ore crusher unit at the site, the company said in an e-mailed statement. The shutdown will last “several weeks” and customers will be supplied from inventories and through purchases of crude on the market, spokesman Pius Rolheiser said by phone. Imperial was producing 92,000 barrels a day at Kearl in the third quarter, the company said. Western Canadian Select, a heavy blend that is a benchmark for oil-sands production, strengthened by $1 a barrel to a $15.10 discount to West Texas Intermediate at 11:48 a.m., according to data compiled by Bloomberg. “This should help support prices,” John Auers , vice president of the Dallas-based consulting company Turner Mason & Co., said by telephone. “It’s not super […]

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Bill for shutting nuclear plants will reach $100bn

Photo taken on October 14, 2009 shows a board indicating a contaminated area at the French electricity group EDF (Electricite de France) nuclear plant in Flamanville, western France ©Getty The bill for closing down and cleaning up the world’s ageing nuclear reactors will exceed $100bn over the next 25 years alone, the leading energy watchdog has said, warning that governments risk underestimating the cost. With almost 200 reactors due to be shut down by 2040, the International Energy Agency says in its annual report there are “considerable uncertainties” about decommissioning costs, reflecting governments’ limited experience in safely dismantling nuclear plants. In the last 40 years, only 10 reactors have been closed down. More On this topic Energy watchdog in investment warning Japan has high hopes for ‘flammable ice’ Lex LNG – Buyers beware IEA warns of future oil supply crunch IN Energy Peabody sees reprieve from US carbon rules […]

Posted On : Published By : Tom Whipple