Category:

Kurds angered by anti-ISIL conference snub

The president of Iraqi Kurdistan on Friday slammed the United States-led coalition against the Islamic State in Iraq and the Levant (ISIL) for excluding the Kurds from an organizational meeting in London this week, noting that his hard-bitten peshmerga fighters had proven themselves the only capable force on the ground to combat the armed group.  “We were expecting everyone to show respect to the sacrifices made by the people of Kurdistan and its peshmerga [fighters] by inviting a representative from Kurdistan to this event and similar such events,” Massoud Barzani said in a heated statement, as translated by Kurdish Rudaw news. The peshmerga “are the most effective force countering global terrorism today," he added. “It is unfortunate that the people of Kurdistan do the sacrifice and the credit goes to others." It’s not clear why the Kurds were snubbed at the London conference, though many suspect it could simply […]

Posted On : Published By : Tom Whipple
Category:

Al-Naimi Likely to Remain Saudi Oil Minister Until Market Calms

Saudi Oil Minister Ali al-Naimi is likely to stay in his position until current oil-market turbulence subsides, according to Saudi and Persian Gulf oil officials familiar with the matter—with Riyadh eager to signal stability and consistency in its oil policy following the death of King Abdullah. After Abdullah’s death early Friday, oil prices shot higher before settling back down, as traders weighed whether the newly installed King Salman might alter oil policy for the world’s largest crude exporter. King Salman early Friday issued a royal decree retaining all of the kingdom’s current ministers, according to the official Saudi Press Agency. Appearing on Saudi national television, the new king said he would maintain the policies of his predecessor. That, Saudi and Gulf officials said, includes oil policy and retaining Mr. Naimi. King Salman “realizes how important Naimi is, and how the oil market respects him,” according to one Saudi official. […]

Posted On : Published By : Tom Whipple
Category:

New Saudi King and U.S. Face Crucial Point in the Relationship

WASHINGTON — Almost a decade ago, an Arab diplomat famously likened the relationship between the United States and Saudi Arabia to a Catholic marriage “where you can have no divorce.” But there can be estrangement. As the Obama administration begins the arduous task of assessing the newly reconstituted House of Saud after the death of King Abdullah on Friday, the relationship between the United States and its most important Arab ally, one fostered with great care and attention to detail over the years, is at a critical and tumultuous point. Saudi Arabia’s new king, Salman , 79, inherits both the policies put in place by the more assertive brother he is succeeding and the conflicts that in recent years have characterized relations with Washington. On issues from Iran to the Arab Spring, from Syria to domestic issues within Saudi Arabia like the recent flogging of a journalist , there […]

Posted On : Published By : Tom Whipple
Category:

Meet the Saudi royal family’s rising star, Prince Mohammed bin Nayef

Saudi Arabia’s then-Deputy Interior Minister Prince Mohammed bin Nayef listens to the national anthem at a military parade in this Oct. 20, 2012, file photo. Saudi Arabia’s new King Salman appointed Mohammed as deputy crown prince. (Amr Abdallah Dalsh/Reuters) RIYADH, Saudi Arabia — In August 2009, a young Saudi militant with ties to al-Qaeda in the Arabian Peninsula sent word to Prince Mohammed bin Nayef, then Saudi Arabia’s counterterrorism chief, that he wanted to turn himself in. Mohammed sent his private plane to pick the man up, and he was taken to the prince’s home in the port city of Jiddah. But once the militant got within a few feet of Mohammed, he detonated a bomb that he was carrying in a body cavity. The explosion blew the attacker apart and lightly injured Mohammed, who has survived at least three other assassination attempts. “It was a mistake,” Mohammed acknowledged […]

Posted On : Published By : Tom Whipple
Category:

Beleaguered, Nigerians Seek to Restore a General to Power

KADUNA, Nigeria — Boisterous crowds packed the streets for the retired general, while young men climbed lampposts, walls and billboards to glimpse his gaunt face. Others danced on careening motorcycles, brandishing homemade brooms, symbols of his campaign. With Nigeria ’s presidential election only weeks away, Boko Haram’s unchecked rampaging here in the country’s north is helping to propel the 72-year-old general, Muhammadu Buhari, to the forefront. After ruling Nigeria with an iron hand 30 years ago as the country’s military leader, Mr. Buhari is now a serious threat at the ballot box, analysts say, in large part because of Boko Haram’s blood-soaked successes. “The state is collapsing and everybody is frightened,” Jibrin Ibrahim, a political scientist with the Center for Democracy and Development in Abuja, the Nigerian capital, said of Boko Haram. “They are able to capture more and more territory, but also increase the level of atrocity,” he […]

Posted On : Published By : Tom Whipple
Category:

Brazil’s most populous region facing worst drought in 80 years

Sao Paulo state has received only one third of the rainfall expected in the wet season Related Stories Brazil’s Environment Minister Izabella Teixeira has said the country’s three most populous states are experiencing their worst drought since 1930. The states of Sao Paulo, Rio de Janeiro and Minas Gerais must save water, she said after an emergency meeting in the capital, Brasilia. Ms Teixeira described the water crisis as "delicate" and "worrying". Industry and agriculture are expected to be affected, further damaging Brazil’s troubled economy. The drought is also having an impact on energy supplies, with reduced generation from hydroelectric dams. ‘Poor planning’ The BBC’s Julia Carneiro in Rio de Janeiro says Brazil is supposed to be in the middle of its rainy season but there has been scant rainfall in the south-east and the drought shows no sign of abating. The crisis comes at a time of high […]

Posted On : Published By : Tom Whipple
Category:

Mexico looks the other way as contractors fleece oil giant Pemex

BIG TARGET: A Pemex petrochemicals plant in the city of Coatzacoalcos. Pemex provides a third of all Mexican government revenue – but is vulnerable to fraud and waste. Reuters identified $11.7 billion in Pemex contracts flagged as problematic by government auditors. But records show that authorities rarely act on those warnings. REUTERS/Oscar Martinez Mexican authorities have disregarded auditors’ warnings on billions of dollars of deals granted by the state oil giant, a Reuters examination shows. Among the businessmen who benefited: an alleged associate of the Zetas cartel. MEXICO CITY – The state-owned petroleum giant Pemex paid $9 million in 2011 to have an oil rig towed halfway round the world, from the United Arab Emirates to the Gulf of Mexico. When government auditors looked at the contract, they turned up some problems. The rig had the wrong equipment for the assignment, according to a report by Mexican congressional auditors. […]

Posted On : Published By : Tom Whipple
Category:

Pakistan Fuel Shortage Crisis Forces Sharif to Cancel Davos Trip

Pakistani Prime Minister Nawaz Sharif canceled a trip to attend the World Economic Forum in Davos, Switzerland, as the nation’s worst fuel shortages in memory threatened to revive street protests against him. 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 government has sold fuel from its reserves and private companies have boosted supplies as anger grows over long waits at petrol stations. 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 Jan. 21 text message. The crisis is a test of Pakistan’s credibility in the eyes of overseas investors, whose fivefold […]

Posted On : Published By : Tom Whipple
Category:

Beijing to start building four subway lines in 2015

BEIJING, Jan. 24 (Xinhua) — Beijing plans to start construction on four subway lines in 2015 as the city authorities continue to resort to the metro system to ease traffic jams. Beijing mayor Wang Anshun revealed the plan in the government work report he delivered to the annual meeting of the municipal legislature on Friday. Officials with the Beijing Infrastructure Investment Co., Ltd. said the public-private-partnership (PPP) funding model might be used for the construction in a bid to reduce government debts. Meanwhile, sections of two existing metro lines will be opened for riders this year, said Wang. On Dec. 28, Beijing opened four new subway lines, increasing the total subway length in the Chinese capital by 62 kilometers to 527 kilometers. Also on Dec. 28, the city authorities hiked the subway fares. While passengers used to be charged a flat fee of 2 yuan, they are now charged […]

Posted On : Published By : Tom Whipple
Category:

Release reported in North Dakota

North Dakota Health Department reports release of water used during shale oil production. UPI/Brian Kersey BISMARCK, N.D., Jan. 23 (UPI) — A division of Hess Corp. spilled more than 2,000 barrels of water used during oil production at a site southwest of Tioga, the North Dakota government said. The North Dakota Department of Health said it was notified by the company of the release of so-called source water , which is used during oil production, from an area pipeline. "This water is higher in dissolved solids and minerals than fresh water," the Department of Health said in a Thursday notification. "The responsible party has initiated cleanup." The water was used during a process known as enhanced oil recovery, a technique that involves flow stimulation from steam, gas or chemical injections into the well. There was no statement on public health concerns Analysis last year from Wood Mackenzie finds enhanced […]

Posted On : Published By : Tom Whipple
Category:

GE Profit Boosted by Industrial Unit but Drop in Oil Creates Ripple Effect

ENLARGE General Electric says revenue in its industrial segment increased 6% to $32 billion in the fourth quarter. Photo: Bloomberg News General Electric Co. ’s oil and gas business managed to blunt the hit from plunging prices of crude but the company is braced for deepening trouble in the year ahead. In the final three months of 2014, orders fell 10% in GE’s oil and gas business, including a 72% decline in requests for such drilling equipment as blowout preventers. The company said it hasn’t yet had to negotiate lower prices for its backlog of orders. But customers are starting to call, as they look to curtail projects, lay off workers and trim costs. “That’s to come in 2015,” Chief Financial Officer Jeff Bornstein said. For the past decade, GE Chief Executive Jeff Immelt has built up a sizable oil and gas operation, which accounted for about 17% of […]

Posted On : Published By : Tom Whipple
Category:

BHI: US rig count falls for 8th straight week, down 43 units

HOUSTON, Jan. 23 01/23/2015 The US drilling rig count fell 43 units to settle at 1,633 rigs working during the week ended Jan. 23, Baker Hughes Inc. reported. That total is the lowest since Aug. 6, 2010, and 144 units fewer compared with this week a year ago. The count has now fallen in 8 consecutive weeks, losing 287 units during that time ( OGJ Online, Dec. 5, 2014 ). Forty-two of the 43 units that went offline this week were land-based, bringing that total to 1,568. Land rigs have plunged 176 units over the last 3 weeks. The other unit to fall was drilling in inland waters, bringing that total to 11. Offshore rigs were unchanged at 54. Oil rigs plunged 49 units to 1,317. Gas rigs gained 6 units to 316. Horizontal drilling rigs lost 24 units to 1,229. Consultancy group Wood Mackenzie Ltd. recently said that, […]

Posted On : Published By : Tom Whipple
Category:

Wood Mac: US Onshore Well Count to Fall by 26% in 2015

URL: http://www.rigzone.com/news/oil_gas/a/136910/Wood_Mac_US_Onshore_Well_Count_to_Fall_by_26_in_2015 Oil prices under $50/barrel will results in a decline in North American well counts and rig day rates as operators scale back 2015 spending plans. The U.S. onshore well count will decline by 26 percent, from more than 37,000 in 2014 to an estimated 27,000 in 2015, as the decline in oil prices prompted many operators to cut their 2015 spending plans, according to a recent estimate by Wood Mackenzie. North American drilling and completion expenditures exceeded $140 billion in 2014, but Wood Mackenzie expects operators to commit less than $90 billion to upstream development over the next 12 months. “Such sizeable cuts will have serious implications across the oilfield services sector,” said Wood Mackenzie in a statement. Using its North America Supply Chain Analysis Tool, Wood Mackenzie forecasts that rig day rates will decline by 30 percent, while the rig count will drop from an annual […]

Posted On : Published By : Tom Whipple
Category:

Oil Rigs in U.S. at 2-Year Low as Bakken Drillers Bail

Rigs targeting U.S. oil slid to the fewest in two years as explorers retreated from North Dakota’s Bakken formation at the fastest pace since the nation’s shale boom took off. The U.S. oil rig count dropped by 49 this week to 1,317, the lowest since Jan. 25, 2013, Baker Hughes Inc. (BHI) said on its website Friday. The total count fell by 43 to 1,633. North Dakota, home of the Bakken play that doubled its crude output within two years, lost the most rigs since at least 2008 with prices under $50 a barrel. Oil rigs have dropped by an unprecedented 258 in seven weeks, threatening to end the surge in domestic oil production that has turned the U.S. into the world’s largest fuel exporter. The booming production, out of shale formations across the country, has OPEC and other foreign suppliers fighting to preserve their market share. Eight hundred […]

Posted On : Published By : Tom Whipple
Category:

U.S. Steelworkers to Reject Oil Companies’ First Offer

United Steelworkers leaders, representing employees at about two-thirds of U.S. refineries, instructed members to reject the first three-year contract proposed by companies on Friday, describing the offer as “offensive.” Gary Beevers, the USW international vice president who manages the union’s oil sector, told all local units to turn down the proposal made collectively by companies including Chevron Corp. (CVX) , Exxon Mobil Corp. (XOM) , Marathon Petroleum Corp., Royal Dutch Shell Plc (RDSA) and Tesoro Corp. (TSO) , a telephone message distributed to members on Friday shows. Negotiations between the USW and refiners began this week. The current contract expires Feb. 1. Oil workers are asking for bigger pay raises and better benefits as U.S. oil refiners cash in on the cheapest oil in almost six years. The market value of U.S. refiners has jumped as plants take advantage of a domestic shale boom that has propelled the nation’s […]

Posted On : Published By : Tom Whipple
Category:

Baker Hughes total US rig count is lowest seen since August 2010

Houston (Platts)–23Jan2015/512 pm EST/2212 GMT The Baker Hughes rotary rig count fell 43 this week to 1,633 total oil and gas rigs working on land and offshore for the week ending Friday — the lowest the count has been since August 2010. Of the total US rig count, 1,579 rigs — nearly 97% — are working on land or inland waters, the lowest number since July 2010 and also down 43 from a week ago, the oil services company said Friday in its weekly data. While that is an abnormally high dropoff for a rig count that has bee generally slow-moving in recent years, it is not as steep as declines earlier this month. For example, the number of land rigs fell by 74 during the week that ended January 16 and 60 the week that ended January 9, Baker Hughes data show. Oil prices that have plunged more […]

Posted On : Published By : Tom Whipple
Category:

Russian economy in bad shape, minister says

Russia’s economic woes predate crises in Ukraine, minister says from sidelines of the World Economic Forum. Photo by Denis Larkin/Shutterstock DAVOS, Switzerland, Jan. 23 (UPI) — Russian economic woes predate the steady decline in oil prices and sanctions triggered by crises in Ukraine, a Russian minister said Friday from Switzerland. Russian First Deputy Prime Minister Igor Shuvalov said from the sidelines of the World Economic Forum in Davos the Russian economy never fully emerged from the economic crises that ensnared the global economy in 2008-09. "We briskly started to lose our rate of growth and it became clear that a structural crisis was looming," he said. Analysis from the World Bank in December finds the Russian economy will face difficulties through 2016 because of the decline in global oil prices. A January report from the International Monetary Fund said the Russian economy should shrink by 3 percent this year. […]

Posted On : Published By : Tom Whipple
Category:

Euro’s Big Drop Puts U.S. Economy, Federal Reserve to the Test

European Central Bank President Mario Draghi. ENLARGE Photo: Associated Press The European Central Bank’s launch of an aggressive program this week to buy more than €1 trillion in bonds poses important tests for the U.S. economy and the Federal Reserve. Europe’s new program of money printing—and the resulting fall in the euro—means the U.S. economy must deal with a rapidly strengthening dollar that will make American goods more expensive abroad. The stronger dollar could slow both U.S. growth and inflation, giving the Fed some incentive to hold off on its plan to raise short-term interest rates later this year from near zero. U.S. officials have been playing down that scenario, and, more broadly, resisting talk of a global currency war—competitive devaluations by countries eager to keep their currencies as low as possible to protect exports. The U.S. dollar has already soared in the wake of the ECB announcement Thursday […]

Posted On : Published By : Tom Whipple
Category:

War Is Exploding Anew in Ukraine; Rebels Vow More

DONETSK, Ukraine — Unexpectedly, at the height of the Ukrainian winter, war has exploded anew on a half-dozen battered fronts across eastern Ukraine , accompanied by increasing evidence that Russian troops and Russian equipment have been pouring into the region again. A shaky cease-fire has all but vanished, with rebel leaders vowing fresh attacks. Civilians are being hit by deadly mortars at bus stops. Tanks are rumbling down snowy roads in rebel-held areas with soldiers in unmarked green uniforms sitting on their turrets, waving at bystanders — a disquieting echo of the “little green men” whose appearance in Crimea opened this stubborn conflict in the spring. The renewed fighting has dashed any hopes of reinvigorating a cease-fire signed in September and honored more in name than in fact since then. It has also put to rest the notion that Russia’s president, Vladimir V. Putin, would be so staggered by […]

Posted On : Published By : Tom Whipple
Category:

Oil Rebounds on Saudi King’s Death, China PMI Data

The death of Saudi King Abdullah bin Abdulaziz al Saud comes at a critical point for the kingdom’s oil policy. The WSJ’s Andrew Peaple examines what oil watchers are looking for. Crude-oil futures rebounded in Asian trade Friday after news of the death of Saudi Arabia’s King Abdullah and marginal improvement in China’s manufacturing data. On the New York Mercantile Exchange, light, sweet crude futures for delivery in March traded at $47.10 a barrel, up $0.79 in midmorning trade on the Globex electronic session. Brent crude for March delivery on London’s ICE Futures exchange rose $0.84 to $49.36 a barrel. Saudi Arabia’s King Abdullah bin Abdulaziz al Saud died at the age of around 90, according to a royal court statement early Friday morning. The statement also said that Abdullah’s half-brother, Crown Prince Salman, who is 79 years old, was declared king and Prince Muqrin, 69, became crown prince. […]

Posted On : Published By : Tom Whipple
Category:

Oil Climbs as Saudi King’s Death Spurs Policy Speculation

Oil rose after the death of King Abdullah of Saudi Arabia , the biggest producer in the Organization of Petroleum Exporting Countries. Futures rallied as much as 3.1 percent in New York and 2.6 percent in London after the Saudi royal court announced the death in a statement. Crown Prince Salman bin Abdulaziz will succeed Abdullah on the throne. The kingdom, the world’s largest crude exporter, led OPEC’s decision to maintain its oil-production quota at a meeting in November, exacerbating a global glut that’s driven prices lower. “The passing of King Abdullah is going to increase uncertainty and increase volatility in oil prices in the near term,” Neil Beveridge , a Hong Kong-based analyst at Sanford C. Bernstein & Co., said by phone. “I wouldn’t expect a change in policy in the near term to be known, but the passing comes at a challenging time for Saudi Arabia.” Oil […]

Posted On : Published By : Tom Whipple
Category:

Oil jumps as Saudi king’s death feeds market uncertainty

SINGAPORE (Reuters) – Oil prices jumped on Friday as news of the death of Saudi Arabia’s King Abdullah added to uncertainty in energy markets already facing some of the biggest shifts in decades. Abdullah died early on Friday and his brother Salman became king in the world’s top oil exporter. Salman named his half-brother Muqrin as heir, moving to forestall any succession crisis at a moment when Saudi Arabia faces unprecedented turmoil on its borders and in oil markets. Brent crude futures rose to a high of $49.80 a barrel shortly after opening before easing back to $49.30 a barrel by 0650 GMT, up 78 cents. U.S. WTI crude futures were at $47, down from a high of $47.76 earlier in the session. "This little spike in prices is understandable. But this is a selling opportunity in our view. It should be sold off quickly and it won’t last […]

Posted On : Published By : Tom Whipple
Category:

NYMEX crude closes lower on big jump in US inventories

New York (Platts)–22Jan2015/410 pm EST/2110 GMT NYMEX March crude settled $1.47 lower at $46.31/b Thursday after US Energy Information Administration data showed a 10.1-million-barrel increase last week in US commercial crude stocks. A weaker euro pushed ICE March Brent 51 cents lower at $48.52/b. NYMEX refined products ended mixed. Prompt ULSD settled down 85 points at $1.6379/b, while March RBOB closed 53 points higher at $1.3308/gal. A combination of strong crude production and a drop in refinery runs pushed crude inventories higher. Analysts surveyed Tuesday expected crude stocks to have increased only 2.5 million barrels. Article continues below… Oilgram Price Report is a daily report that covers market changes, market fundamentals and factors driving prices. Oilgram Price Report also brings a vast array of Platts international prices for crude and products, netback tables, and market critical data. The preliminary estimate of weekly crude production was 9.19 million b/d, down […]

Posted On : Published By : Tom Whipple
Category:

At Davos, CEOs Eagerly Await Boost From Oil Price Drop

An oil refinery operated by OAO Lukoil, in Nizhny Novgorod, Russia. ENLARGE Photo: Bloomberg News DAVOS—Low oil prices have roiled oil exploration and production companies, but chief executives from a wide swath of the global economy, gathered here for the annual World Economic Forum are looking forward to a boost from the drop. Oil prices are down more than 50% since June, amid a supply glut partly due to booming American shale-oil production. In November, the Organization of the Petroleum Exporting Countries chose to maintain its output levels, saying it wouldn’t risk market share as non-OPEC producers, from the U.S. to Russia, continue to pump flat out. That has slammed big oil firms and companies that provide services for the sector. A number of big companies, from ConocoPhillips to BP PLC, have signaled they will be cutting back capital spending. On Thursday, OAO Lukoil Holdings President Vagit Alekperov said […]

Posted On : Published By : Tom Whipple
Category:

Oil markets mixed after ECB action

Markets struggle to make sense of QE program unveiled Thursday by the European Central Bank. UPI/John Angelillo NEW YORK, Jan. 22 (UPI) — Oil price indices were mixed early in the Thursday session as traders tried to make sense of the bond-buying initiative from the European Central Bank. Beginning in March, the ECB said it would purchase bonds valued at more than $65 billion per month through September 2016 as part of a so-called quantitative easing program meant to stimulate the struggling European economy. ECB President Mario Draghi said low inflation and the secondary effects of low crude oil prices meant it was time to act to save the ailing eurozone from further calamity . "Thus, today the adoption of further balance sheet measures has become warranted to achieve our price stability objective," he said in a statement. Inflation in an already struggling eurozone turned negative in December, driven […]

Posted On : Published By : Tom Whipple
Category:

Oil Trades Below $48 as U.S. Crude Supplies Seen Higher

Oil traded below $50 a barrel in London for a third day as investors awaited a European Central Bank decision on starting a quantitative-easing program. Brent futures fell as much as 1.1 percent. The dollar approached an 11-year high against the euro, undermining the appeal of dollar-priced commodities for protecting against inflation, amid speculation the ECB will today introduce large-scale bond purchases. Oil also declined on estimates that U.S. crude inventories expanded for a second week. “The ECB will rule market sentiment today,” Olivier Jakob , managing director at consultants Petromatrix in Zug, Switzerland , said by e-mail. “Some QE is already priced in, hence directionally crude can go both ways” once the ECB’s intentions are clear, he said. Brent for March settlement was 10 cents lower at $48.93 a barrel on the London-based ICE Futures Europe exchange as of 9:45 a.m. London time, having earlier fallen as low […]

Posted On : Published By : Tom Whipple
Category:

Gunvor Sees No Return to $100 Oil Once Price Plunge Is Reversed

Oil prices won’t recover to $100 a barrel once a current rout is reversed, said the head of research at Gunvor Group Ltd., a firm trading more than 2.5 million barrels of crude and fuels each day. Saudi Arabia , the nation leading OPEC in defending its share of global oil market, will resist $100 to $120 a barrel crude, he said, without specifying for how long. Brent oil, the global benchmark, collapsed by almost half last year as Saudi Arabia and others in the Organization of Petroleum Exporting Countries committed to maintain output amid a global surplus. U.S. output is the highest in three decades as drillers unlock stores in shale formations. “It will be interesting to see how the Saudis react when prices start rising again,” Fyfe said. “They won’t want prices to rebound to $100-$120 as they’d be back to square one.” Global demand will grow […]

Posted On : Published By : Tom Whipple
Category:

Natural Gas in a Steady Retreat on Concerns About Bear Market

By Timothy Puko Natural gas is in a steady retreat Thursday as concerns about a long-term bear market are pushing traders back into a selloff. Natural gas for February delivery is down 7 cents, or 2.4%, at $2.904 a million British thermal units on the New York Mercantile Exchange. Trading volumes are light, but analysts said that will probably change and volatility is likely to pick back up after the federal government’s weekly storage update, scheduled for 10:30 a.m. Stockpiles likely fell by 227 billion cubic feet of gas during the week ended Jan. 16, according to the average forecast of 19 analysts and traders surveyed by The Wall Street Journal. That would be among the 20 largest draws on storage in EIA records dating back to 1994. But many traders have been looking past that and have focused on the chance that record supply could lead to a […]

Posted On : Published By : Tom Whipple
Category:

Islamic State momentum halted or reversed in Iraq: Kerry

LONDON (Reuters) – U.S. Secretary of State John Kerry said on Thursday that Islamic State’s momentum in Iraq had been halted or reversed and that U.S. weapons for government forces would be arriving very shortly. "In recent months we have seen definitively … momentum halted in Iraq and in some cases reversed," Kerry told a London news conference after a meeting of the U.S.-led coalition fighting IS. "Ground forces supported by nearly 2,000 air strikes now have reclaimed some 700 square kilometers," he said, adding that Iraqi forces would be getting lots of U.S.-made M16 rifles "very, very shortly.” "There is an (arms) pipeline here, and it is working,” he said. (Reporting by Warren Strobel and Kylie MacLellan ; Editing by Andrew Osborn)

Posted On : Published By : Tom Whipple
Category:

Saudi Arabia to bury King Abdullah on Friday

RIYADH (Reuters) – Saudi Arabia will bury King Abdullah in an unmarked grave on Friday, hours after it moved to ensure a smooth transition by appointing a new king and crown prince to quell fears of dynastic instability at a time of regional turmoil. Abdullah’s successor, King Salman, now takes over as the ultimate authority in a country that faces unprecedented tumult in the region and difficult long-term domestic challenges compounded by the plunging price of oil. Salman must navigate a white-hot rivalry with Shi’ite Muslim power Iran playing out in Iraq, Syria, Yemen, Lebanon and Bahrain, open conflict in two neighboring states, a threat from Islamist militants and bumpy relations with the United States. Reputedly pragmatic and adept at managing the delicate balance of clerical, tribal, royal and Western interests that factor into Saudi policy making, Salman appears unlikely to change the kingdom’s approach to foreign affairs or […]

Posted On : Published By : Tom Whipple
Category:

Salman Becomes Saudi Arabia’s Ruler After Death of King Abdullah

Salman Bin Abdulaziz Al Saud ascended to the throne of Saudi Arabia after the death of his half-brother King Abdullah, taking the helm of the biggest Arab economy amid political turmoil in the Middle East and tumbling oil prices. King Abdullah, who was born in 1924, died at 1 a.m. in Riyadh . The royal court said Salman, 79, was named king and Prince Muqrin, 69, another half-brother, has been chosen as Crown Prince. Oil prices surged after the announcement. Salman was named as crown prince in 2012 and takes over as the world’s top oil exporter faces a growing threat of militant attacks at home after joining the U.S.-led military coalition against Islamic State in Syria. Regional rival Iran and its Shiite allies are gaining influence, while plunging oil prices are curbing Saudi Arabia’s capacity to invest. “King Abdullah made every effort to make sure the transition would […]

Posted On : Published By : Tom Whipple
Category:

Saudi Arabia’s New King Probably Will Not Change Current Oil Policy

King Salman, Saudi Arabia’s new ruler, probably will stick to the oil policy of his predecessor, the late King Abdullah , maintaining production levels to preserve market share even at the cost of depressing prices. A key indicator will be whether Salman, 79, retains the oil minister, Ali al-Naimi , who has driven decision-making since 1995. Naimi, who turns 80 this year, has said he’d like to devote more time to his other job, chairman of the science and technology university named after the late sovereign. With production of 9.5 million barrels a day and exports of 7 million, Saudi Arabia accounts for more than a 10th of global supply and a fifth of crude sold internationally. The kingdom’s refusal to surrender market share to rising U.S. output has contributed to the worst slump in prices since the global credit crisis of 2008. “The Saudi leadership has already taken […]

Posted On : Published By : Tom Whipple
Category:

Oil Prices Probably Won’t Keep Gains Made After Death of Saudi King

The increase in oil prices after the death of Saudi Arabia ’s King Abdullah will probably be temporary amid an oversupply in the crude market. Brent, the global oil benchmark, climbed as much as 2.6 percent and U.S. marker WTI jumped 3.1 percent after the king’s death was announced by Saudi royal court. Crown Prince Salman bin Abdulaziz, Abdullah’s half-brother who will succeed him, is seen sticking to the oil policy of the world’s biggest crude exporter. Saudi Arabia, OPEC’s biggest producer, has led the group’s strategy of maintaining production quotas amid a 58 percent drop in crude since its peak in June. While smaller producers including Venezuela called for action to prop up prices, Saudi Oil Minister Ali al-Naimi highlighted the need to preserve market share as global demand slows and the U.S. pumps the most since 1983. “There’s still an overwhelming glut of supply in global markets,” […]

Posted On : Published By : Tom Whipple
Category:

IMF: Venezuela wounded by low oil prices

Venezuelan President Nicolas Maduro faces uphill economic battle as low oil prices take their toll. (UPI Photo/Mohammad Kheirkhah) WASHINGTON, Jan. 22 (UPI) — Venezuela’s economy will decline more than any other in the region as a result of the drop in oil prices, analysis from the International Monetary Fund found. The Central Bank of Venezuela in December said the collapse in oil prices was in part to blame for a 2.3 percent drop in third quarter gross domestic product. That marked three straight quarters of decline for the member of the Organization of Petroleum Exporting Countries and a formal slip into recession . Oil prices have dropped more than half since June and are down 20 percent since the Central Bank’s announcement. Alejandro Werner, director of the IMF’s Western Hemisphere division, said declining oil prices means a sharp economic downturn for Caracas. "Venezuela’s economy will take the largest hit […]

Posted On : Published By : Tom Whipple
Category:

South Sudan’s Warring Factions Sign Peace Deal

ENLARGE South Sudan’s President Salva Kiir, left, exchanges documents with rebel leader Riek Machar, right, in Arusha, Tanzania, as Tanzania’s President Jakaya Kikwete looks on. Photo: Agence France-Presse/Getty Images KAMPALA Uganda—Warring factions in South Sudan have signed an agreement to reconcile the ruling Sudan People’s Liberation Movement party, officials said on Thursday, in the latest effort to resolve the conflict that has ravaged the oil-rich nation for more than a year. Under the deal, signed in the northern Tanzanian city of Arusha, the parties agreed to “reunify and reconcile” the three factions within the party, the Finland-based conflict-resolution group Crisis Management Initiative said in a statement. President Salva Kiir, signed the deal with his former deputy Riek Machar —now a rebel leader—and Deng Alor Kuol, the representative of former political detainees who were arrested shortly after the outbreak of the violence in December 2013. The deal outlines the road […]

Posted On : Published By : Tom Whipple
Category:

Libyan Fighters Seize Benghazi Branch of Central Bank

BAYDA, Libya — Fighters for one of the factions battling for control of Libya seized the Benghazi branch of the country’s central bank on Thursday, threatening to set off an armed scramble for the bank’s vast stores of money and gold, and cripple one of the last functioning institutions in the country. The central bank is the repository for Libya’s oil revenue and holds nearly $100 billion in foreign currency reserves. It is the great prize at the center of the armed struggles that have raged here since the overthrow of Col. Muammar el-Qaddafi in 2011. Western leaders had hoped that it might play a crucial role in helping to bring the rest of the country back together. Since Libyan rebels toppled Colonel Qaddafi with the help of Western airstrikes, the country has slipped into chaos, as militias grounded in particular locations or ideologies have battled for turf, money […]

Posted On : Published By : Tom Whipple
Category:

U.S. pulls more staff from Yemen embassy amid deepening crisis

WASHINGTON (Reuters) – The United States has pulled more staff out of its embassy in Yemen, U.S. officials said on Thursday as Washington scrambled to cope with the collapse of a government that had been a key ally in the fight against al Qaeda. The scaling down of its presence in Yemen is the first sign that the latest turmoil there will affect U.S operations in a country that President Barack Obama hailed just four months ago as a model for “successful” counter-terrorism partnerships. The U.S. diplomatic contingent in Sanaa was drawn down due to the deteriorating security situation in the Yemeni capital, the officials said. They insisted there were no plans to close the embassy, which could been seen as erosion of U.S. resolve in counter-terrorism operations in the volatile Arab country. However, current and former U.S. officials say the chaos engulfing Yemen has already threatened the administration’s […]

Posted On : Published By : Tom Whipple
Category:

Oil drop ‘disastrous’ for anti-Isis fight

Iraqi prime minister Haider al-Abadi The collapse in the oil price has had “disastrous” consequences for the fight against Isis, Haider al-Abadi, Iraq’s prime minister, has warned world powers. Western leaders meeting Mr Abadi in London on Thursday have promised to increase shipments of ammunition and to consider allowing the Iraqi government to defer millions of dollars of payments for key supplies, in order to alleviate budgetary pressure and ensure the country’s military can continue fighting. More On this topic IN Iraq Baghdad’s budgetary crisis, which has been greatly deepened by the falling oil price, dominated discussions on Thursday between representatives of a coalition of world powers that is working to fight the Islamic State of Iraq and the Levant jihadi group, known as Isis. The talks were hosted by Philip Hammond, Britain’s foreign secretary, and led by his US counterpart, John Kerry. “I cannot stress this [problem] any […]

Posted On : Published By : Tom Whipple
Category:

U.S. Fears Chaos as Government of Yemen Falls

SANA, Yemen — The American-backed government of Yemen abruptly collapsed Thursday night, leaving the country leaderless as it is convulsed by an increasingly powerful force of pro-Iran rebels and a resurgent Qaeda. The resignation of the president, prime minister and cabinet took American officials by surprise and heightened the risks that Yemen, the Arab world’s poorest country, would become even more of a breeding ground for Al Qaeda in the Arabian Peninsula, which has claimed responsibility for audacious anti-Western attacks — including the deadly assault on Charlie Hebdo in Paris this month. The resignation of President Abdu Rabbu Mansour Hadi brought full circle Yemen’s Arab Spring revolution, which ousted former President Ali Abdullah Saleh in 2011 amid massive popular protests. Now Mr. Saleh, who has lately made himself an unlikely ally of the Houthi rebels who toppled the government, is poised to return to the forefront of Yemeni politics. […]

Posted On : Published By : Tom Whipple
Category:

State of denial: Power ministry denies fuel shortage for electricity

PSO fuel imports declined 80 per cent, but ministry claims stocks will be enough. STOCK IMAGE ISLAMABAD:  In yet another sign of a lack of coordination within the government, the water and power ministry on Wednesday denied that there was a fuel shortage at power plants, claiming that power generation companies had 10 days’ worth of fuel inventory. A spokesperson for the ministry said that there was little possibility of the power crisis worsening, adding that the ministry was prepared to handle all contingencies. The statement from the water and power ministry appears to be a response to allegations leveled against them by Finance Minister Ishaq Dar at his press conference on Monday. Dar had placed the responsibility for the recent petrol shortages squarely on the petroleum ministry and water and power ministry. The statement from the ministry also contradicts the account that Finance Secretary Waqar Masood gave in […]

Posted On : Published By : Tom Whipple
Category:

Pakistan’s Sharif pulls out of Davos amid fuel crisis

Politicians are arguing over the cause of the petrol shortages Related Stories Pakistan’s Prime Minister Nawaz Sharif has pulled out of the World Economic Forum (WEF) meeting in Switzerland to tackle nationwide fuel shortages. Petrol stations in most major cities closed temporarily last week, and drivers elsewhere face huge queues. Ministers blame a huge spike in demand for the shortage, but critics say it was caused by government incompetence. Mr Sharif held a crisis meeting earlier and promised to punish those causing the problems. It is the second year running that the prime minister has pulled out of the WEF in Davos. Last year he was forced to cancel the trip because of a Taliban attack. Opposition demonstrations Pakistan has faced intermittent fuel crises for years, and Mr Sharif promised during the 2013 election to resolve the issues. Opposition supporters say government incompetence is the real cause But last […]

Posted On : Published By : Tom Whipple
Category:

Disinflation, weaker growth put pressure on Asian central banks

BEIJING/SEOUL (Reuters) – Chinese factories were forced to cut prices for the sixth straight month in January to sell their products, while economic growth in South Korea slowed sharply, raising the prospect of more policy easing from major central banks in Asia. The weak manufacturing reading from China added to expectations that Beijing will have to announce fresh stimulus measures soon, and came a day after the European Central Bank took the ultimate leap and launched a huge bond-buying program as it tries to stave off deflation and kick-start growth. China’s manufacturing growth stalled for the second month in a row, the HSBC/Markit Flash Manufacturing Purchasing Managers’ Index (PMI) survey showed on Friday, while the sub-index for input prices fell to the lowest since the global financial crisis, reflecting a tumble in oil prices that is spreading disinflationary pressure throughout the globe. Chinese companies again cut output prices, but […]

Posted On : Published By : Tom Whipple
Category:

China’s Record Russian Crude Imports Erode Saudi Market Share

China bought a record volume of crude from Russia last year while shipments from Saudi Arabia shrank for a second year as the Asian nation took steps to diversify its sources of oil supply. China’s imports from its northern neighbor increased by 36 percent in 2014, the fastest pace ever, to 33.1 million metric tons, according to General Administration of Customs data e-mailed on Jan. 23. That’s about 665,000 barrels a day. Exports from Saudi Arabia, which remains the biggest supplier, totaled 49.67 million tons in 2014 or 997,000 barrels a day, the least since 2010. The kingdom’s share of China’s crude purchases dropped to 16 percent from 19 percent in 2013. China, the world’s second-largest oil consumer, is benefiting from a wider choice of suppliers amid a global glut fueled by the highest U.S. production in more than three decades. The country’s 2013 agreement with OAO Rosneft could […]

Posted On : Published By : Tom Whipple
Category:

Russia, OPEC Jostle to Meet China Oil Demand

China’s President Xi Jinping and Russia’s President Vladimir Putin. ENLARGE Photo: Itar-Tass/Zuma Press BEIJING—Warming ties between China and Russia are giving a big boost to Chinese imports of Russian oil, to the chagrin of OPEC nations jockeying for a slice of China’s market. Faced with falling prices and lower demand from the U.S., oil-exporting nations are increasingly putting their hopes in China’s still-robust demand for crude. But Saudi Arabia and other big producers like Venezuela have seen such sales drop as Moscow’s isolation from the West over Ukraine prompts it to turn to Beijing. The death of Saudi Arabia’s King Abdullah adds a measure of uncertainty to OPEC’s oil policies, which boosted prices in global oil markets after the news early Friday, though analysts say the kingdom is unlikely to change its strategy and reduce production. That is despite a global glut of crude that is fueling new rivalry […]

Posted On : Published By : Tom Whipple
Category:

As Gasoline Heads Toward $2, the Benefits Start to Trickle Down

ENLARGE BELOW $2: Although the nationwide average for a gallon of regular gasoline remains above $2, it’s fairly well below that level in some parts of the country—such as at this station in Dellwood, Mo., earlier this week. Photo: Getty Images Gas prices appear headed below a nationwide average of $2 a gallon in coming days, extending one of the swiftest declines in decades and delivering a growing windfall to American consumers. The plunge is rippling through the U.S. economy in ways both familiar and unpredictable. Restaurants and bars are seeing their best sales growth in years. Americans are driving more—and buying bigger cars and trucks . Consumer confidence is sitting at an 11-year high , with lower-income households showing the biggest improvement. And some households are using the savings at the pump to get caught up on debts. But the drop in oil prices is also testing the […]

Posted On : Published By : Tom Whipple
Category:

Head West for Best Look at U.S. Oil Drillers’ Pain

Little is going right for California ’s oil industry. Turns out the state’s shale formation holds less promise than producers expected. Aging conventional wells are drying up. And a rebound in output that cost drillers as much as $3 billion annually to create has been overshadowed by shale oil gushing from wells in North Dakota and Texas . Then, of course, came the collapse in oil prices — a seven-month, 57 percent drop that was exacerbated by OPEC’s refusal to cut output in order to squeeze the U.S. shale drillers. No state is feeling that pressure more than California. Drillers there have idled more rigs — on a proportional basis — than those in any other part of the country. “We spent a lot of money to go out and drill and use new technologies just to stop production from depleting in our mature fields,” Rock Zierman, chief executive […]

Posted On : Published By : Tom Whipple
Category:

North Dakota produced water release among state’s largest

Produced water release in North Dakota among the state’s largest. UPI/Shutterstock/Calin Tatu WILLISTON, N.D., Jan. 22 (UPI) — A produced water release from a North Dakota oil site presents no public health risk, a company said, though the 70,000 barrels spilled is among the largest. Summit Midstream confirmed a release from a four-inch pipeline in Williston, N.D., at the heart of the state’s oil boom. The company said Wednesday around 70,000 barrels of produced water were released. Since remediation efforts began, as much as 65,000 barrels of water were pulled from the region’s Blacktail Creek, though most of that was in the form of freshwater. "We will continue to work tirelessly to see that the cleanup is completed and any issues in the surrounding environment are properly addressed, and will provide stakeholders with updates as developments warrant," Chief Operating Officer Rene Casabadan said in a statement emailed to UPI. […]

Posted On : Published By : Tom Whipple
Category:

U.S. consumers to save big on gasoline costs

Low gas prices translates to savings for American consumers to the tune of $125 billion for full-year 2015. hxdbzxy/Shutterstock WASHINGTON, Jan. 22 (UPI) — If gasoline price forecasts for 2015 are accurate, U.S. consumers should save an aggregate $125 billion in fuel costs, analysis published Thursday finds. Motor club AAA reports a national average price for a gallon of regular unleaded gasoline at $2.04, only a very modest decline from Wednesday, but $1.24 less per gallon than this date in 2014. An increased rate of U.S. oil production, coupled with a weakened global economy, is pushing crude oil prices to record lows. That means less pain at the pump for U.S. consumers. The Oil Price Information Service said it expects the national average retail price per gallon of regular unleaded gasoline for 2015 will fall somewhere between $2.35 and $2.45 per gallon. If forecasts are accurate, OPIS said the […]

Posted On : Published By : Tom Whipple