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China posts weakest annual growth in 24 years, more stimulus expected

BEIJING/SHANGHAI (Reuters) – China’s economic growth held steady at 7.3 percent in the fourth quarter from a year earlier, slightly better than expected but still hovering at its weakest since the global financial crisis, keeping pressure on policymakers to head off a sharper slowdown. The world’s second-largest economy grew 7.4 percent in the whole of 2014, the National Bureau of Statistics said on Tuesday, undershooting the government’s 7.5 percent target and the weakest expansion in 24 years. It was the first since 1999 that the government had missed a yearly growth target for gross domestic product (GDP). The China statistics bureau said at a news conference that the economy faces difficulties but it will keep growth within a "reasonable range." A series of incremental market reforms and modest stimulus measures over the year did little to reverse a slowdown in the property market, and industrial overcapacity, slowing investment and […]

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China Makes Most of Oil’s Collapse as Demand Rises to Record

China , the world’s second-largest oil consumer, is making the most of crude’s collapse as refiners process and import more oil than ever. Apparent oil demand, a measure of consumption, rose to an unprecedented 10.63 million barrels a day in December amid record crude processing and increased shipments from suppliers including Saudi Arabia , data compiled by Bloomberg show. This year, demand may expand by 5 percent, bolstered by about 7 million metric tons of crude stockpiling for emergency use, according to ICIS-CI Energy, a Shanghai-based consultant. China is emerging as a winner from the almost 50 percent drop in oil prices last year as OPEC resisted calls to cut production even as the U.S. pumps at the fastest pace in more than three decades. Refiners in the Asian nation will continue to boost operating rates in the coming months amid low diesel stockpiles and “healthy” margins, the International […]

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Opaque jobs picture poses hidden threat to China’s ‘new normal’

Commuters cross a street in the business district of Central in Hong Kong, China, on Monday, Aug. 18, 2014. Slowing economic growth and rising unemployment in Hong Kong may stoke more unrest in the city, which is grappling with a debate over how to pick its next leader in 2017. Photographer: Brent Lewin/Bloomberg China may have recorded its worst annual growth rate in nearly a quarter of a century but the country’s leadership does not appear too worried. “The national economy has been running steadily under the ‘new normal’ , showing good momentum of stable growth, optimised structure, enhanced quality and improved livelihoods,” Ma Jiantang, head of China’s National Bureau of Statistics, said on Tuesday as he revealed the economy had grown 7.4 per cent last year, the slowest pace since 1990. More On this story On this topic IN Chinese Economy The main reason for the nonchalance is […]

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Wood Mackenzie: Operators Could See up to 40% in Cost Reductions

URL: http://www.rigzone.com/news/oil_gas/a/136801/Wood_Mackenzie_Operators_Could_See_up_to_40_in_Cost_Reductions Wood Mackenzie lists 15 things to watch for in North America’s upstream sector in 2015. This opinion piece presents the opinions of the author. It does not necessarily reflect the views of Rigzone. The drop in oil prices has led to an unprecedented level of uncertainty going into 2015, especially for the prospects of the North American upstream oil and gas sector. While there is a lack of consensus about when oil prices will stabilize and at what level, Wood Mackenzie expects service cost relief, asset high-grading, and efficiency improvements in operations. "We are already seeing this play out as upstream operators announce drastically reduced capital budgets for 2015, yet forecast increased production growth (in aggregate)," says Delia Morris, senior North American upstream analyst for Wood Mackenzie. " As long as operators can move to the core areas of plays and sub-play breakevens continue to fall with […]

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Separatists renew attack on airport as Russia and Ukraine bicker

KIEV (Reuters) – Pro-Russian separatists renewed attacks on Ukrainian forces at an airport complex in the east on Monday after Kiev launched a mass operation to reclaim lost ground there that Russia called a "strategic mistake". Ukrainian officials said three soldiers had been killed and 66 wounded over the past 24 hours, during which they said they had returned battle lines at the airport outside Donetsk to the status quo under a much violated international peace plan. Russia expressed concern at what it called escalation by Kiev and published its own peace plan on Monday in the form of a letter from President Vladimir Putin to Ukraine’s President Petro Poroshenko, which it said Poroshenko had rejected. "It’s the biggest, even strategic mistake of the Ukrainian authorities to bank on a military solution to the crisis," Interfax quoted Deputy Foreign Minister Grigory Karasin as saying. "This may lead to irreversible […]

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Russia Confronts Stagnant Oil Output After Crude Price Slump

Russia ’s record crude oil output last year is likely to prove a high-water mark as economic sanctions and lower prices erode investment in developing deposits needed to replace aging Soviet-era fields. The world’s largest oil producer will probably see total output flat, at best, over the next two to three years, according to analysts and forecasters including OAO Gazprombank. Others, such as the Organization of Petroleum Exporting countries, predict a decline. The prospect of stagnant oil production, which has almost doubled since the chaotic years following the collapse of the Soviet Union , will add to the chronic economic challenges confronting President Vladimir Putin ’s government including the slump in energy prices, sanctions and capital flight. It will also allow other oil-exporting nations to grab market share. Russia’s oil production will likely “be flat or see a small decline for the next two or three years,” said Julian […]

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Russian economy to shrink 5%, says EBRD

Historical Museum, St.Basil Cathedral, Red Square, Kremlin in Moscow at night ©iStock Russia’s economy will shrink by close to 5 per cent this year, the European Bank for Reconstruction and Development forecast, while average growth for eastern Europe and the former Soviet Union will fall into negative territory for the first time since 2009. The development bank for the former Communist bloc said plunging oil prices and western sanctions would lead to a contraction in the Russia’s economy of 4.8 per cent this year, compared with a forecast drop of 0.2 per cent in September. More On this topic IN Europe The EBRD also forecast that Ukraine’s economy would shrink 5 per cent in 2015, on top of a 7.5 per cent decline last year. The bank warned that Ukraine’s foreign exchange reserves were “dangerously low”, adding it was “concerned” at the time being taken to put together a […]

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More Russian simple refineries to close at $50/b crude: Rosneft

Antwerp (Platts)–19Jan2015/948 am EST/1448 GMT Russia’s simple refineries are not profitable when the oil price is below $50/barrel, and more are expected to close this year and next, Yuri Timofeev, head of refining strategy at Rosneft, said Monday. Speaking at the Platts middle distillates conference in Antwerp, Timofeev said total refining capacity in Russia will go down over the next few years, but that the quality of refined products will improve substantially. March ICE Brent futures were trading below $50/b Monday, near their lowest level in five years, due to growing supplies globally. Timofeev said the new tax maneuver introduced by Russian authorities at the end of last year would make simple refineries — which produce a high share of lower grade products such as fuel oil — far less profitable. Article continues below… Andrew Bonnington, Platts Editorial Director for European and African Oil and Jorge Montepeque, Platts Global […]

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Schlumberger to Pay $1.7 Billion for Stake in Russia Driller

Schlumberger Ltd. (SLB) will pay $1.7 billion for a stake in Eurasia Drilling Co. (EDCL) , a bet by the world’s largest oilfield services provider that economic sanctions won’t hold back Russia’s energy industry. Schlumberger, based in Houston and Paris, will pay $22 a share for a 46.45 percent holding in London-traded Eurasia Drilling, according to a statement today. Schlumberger has an option to buy the rest of the company’s shares three years after the deal closes. By buying into Russia’s largest driller, Schlumberger is putting aside concerns about economic sanctions and the state of the country’s economy. The deal comes as the slide in the crude price to less than $50 a barrel is spurring consolidation in the services industry as demand for rigs drops and oil producers lean on suppliers to drive down costs. “Schlumberger believes that the sanctions will be lifted sooner or later, and the […]

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EU Has No Plans to Ease Russia Sanctions

ENLARGE A stands at Monday a market that locals say was recently damaged by shelling in Donetsk in eastern Ukraine. Reuters BRUSSELS—The European Union sought Monday to dispel any suggestion that its united front against Russia was faltering or that members were considering lifting sanctions on Moscow in the near future. Questions about how long the 28-nation bloc can stick together in responding to Russian aggressiveness toward Ukraine were highlighted last week by the emergence of an internal EU paper looking at ways to improve ties with Moscow. EU members friendlier to Russia have long questioned the effectiveness of sanctions in influencing the Kremlin. Some have suggested the damage to the Russian economy caused by falling oil prices could provide an opening for scaling back the sanctions as part of a new diplomatic outreach. But EU foreign ministers, meeting Monday, stressed they would consider relaxing sanctions only if Russia […]

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