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Russia Presses Ahead With Plan for Gas Pipeline to Turkey

LONDON — President Vladimir V. Putin surprised the world in December when he aborted long-laid plans for a natural gas pipeline under the Black Sea to Europe, saying Russia would run pipes to Turkey instead. Many in the West thought it might be merely a bluff, to make the European Union reconsider its opposition to the pipeline project, known as South Stream. But in recent weeks, the Russian state-owned company Gazprom has shown signs that it is serious about proceeding with what it calls Turkish Stream. Gazprom quickly bought out its European partners in South Stream Transport, the Amsterdam company that was to build the Black Sea leg of the pipeline. And the chief of that Dutch company has petitioned the Netherlands government to let it keep working with Gazprom, despite European sanctions against Russia over the invasion of Ukraine. On the Turkish front, Gazprom is actively negotiating with […]

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Oil Rises From Biggest Slide in Week as Volatility Rises

Oil rebounded from the biggest drop in a week amid signs that prices near a 5 1/2-year low are slowing drilling in the U.S., the fastest-growing producer. Futures rose as much as 1.4 percent in New York , retracing some of yesterday’s 4.7 percent slide. BHP Billiton Ltd., the largest overseas investor in U.S. shale, said it will cut the number of active drill rigs in the nation by nearly 40 percent. Prices have probably reached their bottom, Iraqi Oil Minister Adel Abdul-Mahdi said in Kuwait on Wednesday. Oil fell almost 50 percent last year, the most since the 2008 financial crisis, as the U.S. pumped crude at the fastest rate in more than three decades and the Organization of Petroleum Exporting Countries resisted calls to reduce supply. “Slower drilling is visible,” Olivier Jakob , managing director at Petromatrix GmbH in Zug, Switzerland, said by e-mail. “We have already […]

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NYMEX February gas futures settle at $2.831/MMBtu, down 29.6 cents

Houston (Platts)–20Jan2015/325 pm EST/2025 GMT The NYMEX February natural gas futures contract tumbled 29.6 cents to settle at $2.831/MMBtu as the market reacted to mild weather forecasts. "Domestic models are predicting that this pleasant weather will last for another five days and that the cold weather to follow will be less widespread than previously thought," said Gelber & Associates analyst Aaron Calder. "There’s still a lot of cold air hovering around Canada trying to get into the United States, but warm, Pacific air is pushing it eastward." The Weather Channel calls for no sub-freezing high temperatures Tuesday across the contiguous US, and highs in the 50s as far north as Omaha, Nebraska, and St. Louis. The forecast calls for low temperatures Wednesday to stay above freezing as far north as Washington and St. Louis. The National Weather Service’s forecast for Friday calls for lows above freezing as far north […]

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Oil Steady After Biggest Loss in a Week as IMF Cuts Forecasts

Oil was little changed in London as the International Monetary Fund cut its global-growth outlook by the most in three years. Brent gained 0.1 percent after slumping by 2.7 percent yesterday. The world economy will grow 3.5 percent in 2015, down from the 3.8 percent pace projected in October, the Washington-based IMF said in its quarterly global outlook yesterday. Prices pared earlier losses as German investor confidence jumped to the highest level in 11 years. Futures declined in New York . Oil slid more than 50 percent since June as the U.S. pumped at the fastest pace in more than three decades and the Organization of Petroleum Exporting Countries resisted calls to cut output. The IMF’s downgrade, following reduced growth expectations published by the World Bank on Jan. 13, undermines speculation that lower oil prices would spur economic activity. “The IMF revision is part of the general growth downgrade […]

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More bad news is bad news for oil prices

Oil prices retreat after IMF issues downgrade to growth forecasts for global economy. Photo by John Angelillo/UPI The price for Brent , the global benchmark, was off more than 3.75 percent to trade near $48 per barrel early in the Tuesday session. The price for West Texas Intermediate , the U.S. benchmark, was down more than 3.8 percent to sell for $46.86 early in the trading day. The declines follow a downbeat report from the IMF on growth expectations for 2015. Growth for the global economy was expected at 3.5 percent this year, a 0.3 percent downward revision. The IMF said that, while low oil prices are a net benefit for consumers, the gains were offset by adverse factors elsewhere in the global economy. Olivier Blanchard , director of research at the IMF, said the low price of oil means different things for different economies and sectors. "[It means] […]

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Natural Gas Has Biggest Losses in 11 Months as Weather Forecasts Warm

By Timothy Puko and Christian Berthelsen Natural-gas futures had their largest day of losses in nearly 11 months as new weather forecasts cut hopes for a burst of cold to ramp up home heating demand. Natural gas for February delivery settled down 29.6 cents, or 9.5%, at $2.831 a million British thermal units on the New York Mercantile Exchange. The percentage losses were greater than any day since late February. They also come less than a week after the biggest one-day gains in the past 11 months, a quick reversal that has sent market volatility to its winter peak. The losses extended a losing streak that started Thursday and have nearly erased all the gains from the start of last week. They had come amid forecasts for a bout of extreme cold to blanket much of the eastern U.S. and a larger-than-expected draw on supplies according to weekly data […]

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Brazil Blackout Spawns Power-Rationing Fears

SÃO PAULO—Monday’s massive blackout is raising concerns that electricity rationing may hit Brazil this year, dealing a potentially serious blow to the nation’s already fragile economy. Energy officials blamed soaring summer demand and a transmission glitch for Monday’s outage , which rolled through the capital Brasília and 11 states, including São Paulo and Rio de Janeiro. But power woes in Brazil, which is suffering from a severe, multiyear drought, won’t be easily solved, according to Mário Veiga, president of PSR Consultoria, an energy consulting group in Rio de Janeiro. He said Brazilian authorities have exacerbated the current crisis by not pressuring consumers to reduce energy consumption sooner. “The problems occurred because the [federal] government did nothing to avoid this situation,” Mr. Veiga said. Mr. Veiga estimated that there is now a 30% chance that Brazil’s southeast, the country’s richest and most populous region, will face energy rationing in coming […]

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Special Report: For Islamic State, wheat season sows seeds of discontent

ARBIL, Iraq (Reuters) – As the season for wheat planting in Iraq wound down early last month, farmers in areas under the control of Sunni militant group Islamic State grew worried. More than two dozen farmers told Reuters they had not planted the normal amount of seed, because they could not access their land, did not have the proper fertilizers or adequate fuel, or because they had no guarantees that Islamic State would buy their crop as Baghdad normally does. Farmers, and Iraqi and United Nations’ officials, now fear a drastically reduced crop this spring. That could leave hundreds of thousands of Iraqis hungry. But another big loser would be Islamic State, which controls territory that normally produces as much as 40 percent of Iraq’s wheat crop. The breakaway al Qaeda group, which declared an Islamic caliphate across parts of Syria and Iraq last summer, has killed thousands and forced hundreds of thousands from their homes. Islamic State militants had hoped to use wheat to show it can […]

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Iraq Says Oil Output Must Rise to Compensate for Price Collapse

Iraq, the nation adding more new oil to global markets than any other supplier in OPEC, said it needs to boost production and exports of crude to compensate for collapsing prices. “Because of the new challenges, especially the price of oil, Iraq has to try its best to raise it oil production and exports,” Deputy Prime Minister Rowsch Nuri Shaways said today at the World Economic Forum in Davos, Switzerland. Iraq has lost about 50 percent of its revenues because of the slump in oil, Shaways said. An agreement last month between the country’s federal government and the semi-autonomous Kurdish region will boost exports by more than 550,000 barrels a day, he said. The nation is pumping at about 4 million barrels a day, already a record, Oil Minister Adel Abdul Mahdi said Jan. 19. Oil slid more than 50 percent since June as the U.S. pumped at the […]

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Kurd Oil Producers Unrelenting to Boost Supply at low Prices

Oil producers in Iraqi Kurdistan are unrelenting in their goal to boost output even after the collapse in international prices to below $50 a barrel. Genel Energy Plc (GENL) , headed by former BP Plc chief Tony Hayward , is sticking with plans to increase capacity 74 percent to 400,000 barrels a day this year at its Kurdish Taq Taq and Tawke fields. Norway’s DNO ASA (DNO) owns 55 percent of Tawke. “The operational side of the business remains very resilient and very strong and we maintain our production increase targets,” Genel Chief Financial Officer Julian Metherell said by phone from London . “Even at $50 a barrel we are looking at a revenue of $350 million to $400 million.” Gulf Keystone Petroleum Ltd. (GKP) , another oil producer in the semi-autonomous region, last month raised output by 60 percent to 40,000 barrels a day and sees 70,000 barrels […]

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