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OPEC’s El-Badri Says Oil Will Rebound Instead of Fall to $20

Oil prices will rebound rather than extend their decline to as low as $20 a barrel because a collapse since June isn’t merited by global supply and demand, OPEC’s Secretary-General said. Producers outside the Organization of Petroleum Exporting Countries should be first to reduce their output amid a surplus that’s pushed crude below $50 a barrel, Abdalla El-Badri said in an interview with Bloomberg Television at the World Economic Forum in Davos, Switzerland on Wednesday. Iraq, OPEC’s fastest-growing supplier, said it needs to boost output to compensate for revenues eroded by the price slump. “The price will not go to $20 or $25, I think the price will stay at where we are now,” El-Badri said. “We have seen this before — prices coming down very fast and go up very slow. But prices will rebound.” Oil slumped almost 60 percent since June as OPEC nations continued pumping amid […]

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White House, Congress Clash Over Iran Sanctions

ENLARGE Sen. Bob Corker (R., Tenn.) chairs his first Senate Foreign Relations Committee hearing in Washington on Wednesday. Photo: Reuters WASHINGTON—The Obama administration collided with Congress Wednesday over Iran sanctions, and both sides were girding for a brawl that appeared likely to stretch through the year. Lawmakers from both parties vowed at a Senate hearing to press ahead with legislative plans for new punitive measures—over President Barack Obama ’s veto warnings. Top administration officials, meanwhile, disclosed at the hearing that the international talks over Iran’s nuclear program may extend beyond an end-of-June deadline. That would be the third such extension. Deepening the chasm, House Speaker John Boehner (R., Ohio) invited Israeli Prime Minister Benjamin Netanyahu to address Congress on Feb. 11 about threats from Islamic extremism and Iran. The Obama administration called the move a breach of diplomatic protocol because neither Congress nor Israel consulted first with the White […]

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Iraq back from the brink with record oil figures

In spite of still struggling to recover from the 2003 war and the continuing Islamic State (IS) insurgency, Iraq produced a record amount of oil last month, the country’s oil minister announced at the weekend. Unveiling production of 4 million barrels of crude per day in December, Adel Abdel Mehdi told reporters that the total was " a historical figure, and the first time Iraq has achieved this." Speaking at a joint press conference with his Turkish counterpart Taner Yildiz in Baghdad, the Iraqi minister added the production increase would "make up" for the recent slump in oil prices. Iraq, where lawmakers are now looking at a 2015 draft budget based on an average of $60 dollars a barrel, depends on crude exports to generate over 90 percent of government revenues. The barrel export count, if confirmed, also trumps estimates of 3.7 million b/d by the International Energy Agency […]

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Algeria Thwarts Plans to Attack Oil Installations

Algiers — In anticipation of possible attacks on the second anniversary of the Tiguentourine gas plant siege, Algerian troops stepped up security on the southern border. Authorities announced last week the foiling of a series of terrorist operations targeting three areas of oil and gas installations in the south. Army forces already succeeded in dismantling a 12-member terrorist cell that was planning attacks against vital facilities in conjunction with the January 16th anniversary of the In Amenas assault. The operation came a few days after the discovery of weapons and military equipment along the border area with Libya, which sparked fears of a fresh attack targeting oil facilities in the vicinity of Tiguentourine. A defence ministry communique stated that the neutralised terrorist cell was preparing to carry out operations in Algeria in co-ordination with groups operating abroad. The communique pointed to a link between this cell and a terrorist […]

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Algeria expects oil price to fall further, delays spending: PM Sellal

Algiers (Platts)–22Jan2015/608 am EST/1108 GMT Algerian Prime Minister Abdelmalek Sellal said late Wednesday he expects the oil price to fall further, adding that Algeria is now in a state of economic "crisis." Speaking on state television, Sellal said Algeria is to defer a number of key infrastructure projects due to the falling oil price as the slump begins to hit the North African country’s economy. "The decline in the oil price will continue and it will not go back to $120/b," he said. "We are in a state of crisis," Sellal said. "Oil is below $50/b, and no one anticipated such a fall." Algeria’s 2015 budget is based on a price of $60/b. "We will continue to invest in social projects, but we will have to cut certain non-essential spending such as trams and railways. These will be postponed," Sellal said. Despite the economic crisis, Sellal said Algeria had […]

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Fuel Shortages Show Pakistani Struggle to Cope With Oil’s Drop

As motorists around the world enjoy the lowest fuel prices in five years thanks to surging production, Pakistanis are struggling to fill up their tanks. Pakistani Prime Minister Nawaz Sharif is racing to tackle one of the nation’s worst fuel shortages in recent memory. Since the crisis began last week, he’s suspended five officials, including Pakistan State Oil Co.’s deputy chief, and has sought hourly updates on the situation. The cash-strapped distributor’s move this month to reduce shipments by 80 percent left it unable to meet a surge in demand after the government cut gas prices to match lower global costs. The Finance Ministry has arranged emergency funding to import oil, Power Minister Khawaja Asif said in a text message yesterday. The crisis is a test of Pakistan’s credibility in the eyes of overseas investors, whose fivefold increase in purchases of the nation’s shares resulted in Asia ’s second-highest […]

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Africa Oil Boom on Hold as Prices Spur Explorer Caution: Energy

Africa’s oil and gas boom is in jeopardy. The dash for resources that saw explorers invest billions of dollars to tap promising oil fields from Ghana on the west coast to Tanzania on the east, is stalling as the global drop in crude prices pushes drillers to reconsider the high costs of exploration on the African continent. For many drillers, 2014 was already failing to reach the promise seen in 2013 when half of the world’s 10 largest oil and gas finds were made in Africa. With oil prices dropping below $50 a barrel, analysts say they expect a more concentrated pullout in 2015. “Now that we’re at another weak oil price, every company will be reviewing discretionary spending,” said Brendan Warn, an analyst at BMO Capital Markets in London. In Africa’s frontier environment, drilling may bring a higher reward, but since most exploration takes place offshore, single wells […]

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Venezuela Sees U.S. Wielding Oil as Weapon to ‘Destroy’ Nation

The U.S. wants to use shale oil as a geopolitical weapon to destroy Venezuela by flooding the market with supply and driving prices down, according to the OPEC member. Hydraulic fracturing, the method used to remove shale oil trapped in rock, is “destructive,” President Nicolas Maduro said during a national address broadcast on radio and television. Venezuela’s economy shrank 2.8 percent last year as crude slumped almost 50 percent amid the fastest pace of U.S. production in more than three decades while the Organization of Petroleum Exporting Countries resisted calls to cut output. “The U.S. wants to use oil as a geopolitical weapon,” Maduro, 52, said during his speech on Jan. 21. “They’re trying to destroy Venezuela.” OPEC members Venezuela and Iran have questioned the group’s decision to maintain its quota. Oman, the biggest Middle Eastern oil producer that’s not part of OPEC, is having a “really difficult time” […]

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Beijing’s “southern water” safe and clear

BEIJING, Jan. 22 (Xinhua) — Beijing’s tap water has passed daily tests since last month, when a massive project drove water from a south China river into the Chinese capital, Beijing’s water supplier said. Water from a tributary of the Yangtze River has flowed about 1,200 km to Beijing since Dec. 27 as part of a south-to-north water diversion project to quench China’s drought-hit north. Beijing Waterworks Group said testing facilities have been installed at 159 sites across Beijing, and tests have been conducted twice a day. So far, the city’s tap water has met national standards, said Liang Li, spokeswoman of the group. The project delivers 800,000 cubic meters of water to Beijing each day, up from 700,000 when the supply began, according to Liang. Residents have praised the influx of "southern water" for clearer tap water. Beijing’s water supply previously relied heavily on groundwater with high calcium […]

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Canada hit hard by falling oil prices

Canadian oil group says it expects decline in commodity prices will have widespread impacts on sectors and economies. UPI/Gary C. Caskey CALGARY, Alberta, Jan. 22 (UPI) — Canadian oil production is expected to drop by more than 100,000 barrels per day because of slumping oil prices, an industry group forecasts. The Canadian Association of Petroleum Producers said in a short-term review it expects oil production to decline by 65,000 bpd this year and 120,000 bpd in 2016. CAPP President Tim McMillan said weak oil prices present a challenge across a wide range of sectors and economies in Canada. "Investors have seen their portfolios shrink. And governments will see reduced revenues from the industry’s royalty and tax payments," he said in a Wednesday statement. "We all will feel the effects." Because of the complexities involved with bringing some of the more viscous forms of Canadian crude oil to the surface, […]

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