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How OPEC Weaponized the Price of Oil Against U.S. Drillers

If there ever was doubt about the strategy of the Organization of Petroleum Exporting Countries, its wealthiest members are putting that issue to rest. Representatives of Saudi Arabia, the United Arab Emirates and Kuwait stressed a dozen times in the past six weeks that the group won’t curb output to halt the biggest drop in crude since 2008. Qatar’s estimate for the global oversupply is among the biggest of any producing country. These countries actually want — and are achieving — further price declines as part of an attempt to hasten cutbacks by U.S. shale drillers, according to Barclays Plc and Commerzbank AG. Crude fell 48 percent last year and has declined 35 percent since OPEC affirmed its output target on Nov. 27. That decision, while squeezing revenues for OPEC members in 2015, aims at preserving their market share for years to come. “The faster you bring the price […]

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Egypt drawing in big energy players

Italian energy company Eni said it signed an agreement to work in the Western Desert of Egypt. UPI/Shutterstock/ekina MILAN, Italy, Jan. 9 (UPI) — With payments surfacing for its counterparts, Italian energy company Eni said Friday it signed an deal to operate in a license area in Egypt’s Western Desert. Eni said it was strengthening its position in Egypt by signing a concession agreement for work in the Western Desert. The deal follows an international auction held in 2013 by the Egyptian General Petroleum Corp. "This new acquisition adds to the list of exploration successes achieved in the area over the past two years and further strengthen Eni’s position in Egypt, an area of historic and strategic importance for the company," it said in a statement. Eni is one of the main oil producers in the country. Operating there since 1954, the company said it had an equity production […]

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Presalt oil and natural gas provide an increasing share of Brazil’s production

Source: U.S. Energy Information Administration, Agência Nacional do Petróleo, Gás Natural e Biocombustíveis In 2013, Brazil produced 2.0 million barrels per day (bbl/d) of crude oil and nearly one trillion cubic feet (Tcf) of gross natural gas. Within these figures, the share of production from presalt resources found under thick layers of salt thousands of feet below the ocean’s surface remains small but continues to increase. Crude oil production from the presalt layer was 15% of total production in 2013, a significant increase from 0.4% of total production in 2008 when oil from the presalt was first produced. Similarly, Brazil’s presalt natural gas production represents 14% of total production, up from 0.5% of total production in 2008. Exploration and development of Brazil’s presalt layer began in and around the Tupi field almost a decade ago, with first production in 2008. Further exploration showed hydrocarbon deposits in the presalt layer […]

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Venezuela: Cuban Military Personnel Return Home

Hundreds of Cuban military personnel have reportedly left Venezuela for Cuba, according to unconfirmed reports from former Monagas state Governor Jose Briceno, Diario de Cuba reported Jan. 9. The reason for the movement is unknown. Meanwhile, a group assembled in Caracas’ La Candelaria neighborhood to protest food and goods shortages , El Universal reported. Long waiting lines for basic goods — including corn flour, cooking oil, milk, diapers and deodorant — have become the norm in Venezuela.

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Nebraska court clears path of Keystone XL

Nebraska court, in default ruling, says law used to sanction state route of Keystone XL oil pipeline is valid. (courtesy TransCanada) OMAHA, Jan. 9 (UPI) — In a mixed decision, the Nebraska Supreme Court ruled Friday the legal premise used to sanction the route for Keystone XL was permissible. In a long awaited case on the route of the Keystone XL pipeline, the Nebraska Supreme Court cleared one of the remaining hurdles in a battle that began when TransCanada first applied to build the project more than six years ago. Lancaster County District Court Judge Stephanie Stacy in February ruled a state law granting power of eminent domain to former Gov. Dave Heineman was unconstitutional. State law LB 1161, passed in 2012, gave the governor authority over the Keystone XL route from Canada through the state instead of the Nebraska Public Service Commission. Environmental campaigners pressured pipeline planner TransCanada […]

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Baker Hughes: U.S. oil and gas work steady

Oil services company Baker Hughes sees few signs of a long-term slowdown on onshore operations in the United States. UPI/Shutterstock/Calin Tatu The oil services company said there were 9,544 wells in service onshore in the United States, relatively unchanged from the third quarter of 2014. Oil prices are at the point where some operators in U.S. shale basins are cutting back on their exploration and production budgets. Oil prices on July 1, the start of the third quarter, were around $105 per barrel, but fell 13 percent by the Oct. 1 start of the fourth quarter. Year-on-year, Baker Hughes said the fourth quarter well count was 5 percent higher during fourth quarter 2014. Oil was priced at about $102 at the start of fourth quarter 2014. Baker Hughes said the well count increased the most in the emerging Cana Woodford shale in Oklahoma and the Marcellus and associated Utica […]

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GOP leadership pushes natural gas developments

Republican leadership on Capitol Hill advance bills to facilitate natural gas deliveries. UPI/Hamid Forotan WASHINGTON, Jan. 9 (UPI) — Republican leaders in the House of Representatives say the federal government needs to pick up the pace with reviewing permits for natural gas pipelines. "Ongoing delays because of a complex permitting process must not prohibit families in Kansas, and across the country, from obtaining reliable and economical heating for their homes in the winter and cooling for them in the summer," Rep. Mike Pompeo, R-Kan., said in a statement after introducing a pipeline bill Thursday. If approved, Pompeo’s measure would require the Federal Energy Regulatory Commission to approve or deny applications for new projects no later than one year after receiving an application. House leaders argue gas pipeline infrastructure additions aren’t keeping pace with increasing production. Republican leaders taking control of the 114th Congress are putting energy at the top […]

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Oil Drillers Pull Most U.S. Rigs in More Than Two Decades

In what is the strongest sign yet of the damage that plunging crude prices are doing to the U.S. oil industry, drillers idled more rigs last week than they have at any point since 1991. Oil rigs fell by 61 to 1,421, Baker Hughes Inc. (BHI) said on its website today, extending the five-week decline to 154. The 2014 peak was 1,609. It was the largest drop since February 1991, which also followed a tumble in prices before the start of the Persian Gulf War . The price of U.S. benchmark West Texas Intermediate oil has plunged by more than half since June, imperiling a shale boom that has brought the nation closer to energy independence than it has been in almost three decades. U.S. drillers laid down the most rigs last quarter since 2009 as the Organization of Petroleum Exporting Countries and the rest of the world’s suppliers […]

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Keystone Pipeline’s Nebraska Path Cleared as Congress Votes

TransCanada Corp. (TRP) ’s Keystone XL pipeline faces one less hurdle after Nebraska ’s highest court cleared its path through the state, sending the matter back to Washington. The pipeline would funnel crude from Alberta’s oil sands to a network junction in southeast Nebraska, for transport to Gulf Coast refineries. While the ruling is a victory for energy independence proponents, the project’s fate remains uncertain. It now returns to President Barack Obama , who had put off a decision citing the pending lawsuit. Today, the House of Representatives passed a bill that would force approval of the pipeline. While four of the seven Nebraska Supreme Court judges held that they would block Keystone XL, five were needed to declare unconstitutional a law that allowed the governor to dictate its path. As a result, the route survived by default. Justice William Connolly, writing for the judges who wanted to block […]

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Oil-Price Crash Is Slow to Hit U.S. Energy Jobs

ByJosh Mitchell and Kathleen Madigan Oil and gas jobs rose nearly 12,000 last year. Ray Gerish, a floor hand for Raven Drilling, works on an oil rig at the Bakken shale formation outside Watford City, N.D. Getty Images (2013) The energy sector may be starting to strain under the steep drop in oil prices, but industry employment hasn’t taken a hit thus far. Jobs in oil and gas extraction actually rose last month, climbing by 400 positions to 216,100, Friday’s jobs report showed. Over the past year, oil and gas jobs rose nearly 12,000. Some energy firms are starting to lay off workers as the drop in global oil prices—tied to a buildup in supplies and weak world demand—hits profits. One possible explanation for why the overall industry continues to add jobs is that employers often delay cutting positions when business turns south. Job cuts can lag other signs pointing […]

Posted On : Published By : Tom Whipple