Category:

Oil Falls on Investor Caution Over Recent Rally

Crude-oil futures fell in Asian trade Tuesday, reversing gains made in the previous trading session, on uncertainty about the rebound in prices and weak Chinese inflation data. On the New York Mercantile Exchange, light, sweet crude futures for delivery in March recently traded at $52.16 a barrel, down $0.70 in the Globex electronic session. Brent crude for March delivery on London’s ICE futures exchange fell $0.71 to $57.63 a barrel. Oil-market participants were assessing a range of mixed indicators about global oil-supply levels. On Monday, monthly reports from both the Organization of the Petroleum Exporting Countries and the International Energy Agency were bullish. OPEC reduced its non-OPEC supply growth estimates, while the IEA said that a price recovery seemed “inevitable” with the oil glut starting to ease as soon as the second half of the year. Oil prices have fallen more than 50% since June on surging output. Both […]

Posted On : Published By : Tom Whipple
Category:

Forecasts Of Oil Price Bottom And Recovery

For oil price forecasters, it is all but mandatory to start with self-deprecating humor, because the track record is so bad. Late 2013, surveys showed predictions for 2014 of $104 per barrel for Brent. Citi’s forecast of a significant drop raised eyebrows, in fact. Now, one reporter noted that expert forecasts range from $30-200, which is both true and funny, but doesn’t capture the actual expectations, primarily because of the time differential. But once prices were clearly falling, there was a rush to be the most bearish. (I suggested back in December that a floor seemed to have been reached at about $50, although at other points on the way down I believed OPEC would manage to stabilize prices at those levels.) A few have suggested that a price of $20 per barrel might be reached, albeit only briefly, while others have picked a range of $40-50, although mostly […]

Posted On : Published By : ASPO-USA
Category:

Oil-Price Rebound Predicted

ENLARGE OPEC says demand for its crude oil will rise this year. Early last month, men worked in oil fields in Bahrain. Photo: Associated Press In the latest sign that the seven-month selloff in crude-oil prices may be nearing a bottom, an energy watchdog said that a recovery seems “inevitable” and the glut that has driven down prices by more than 50% since June could start to ease as soon as the second half. A wave of spending cuts by oil producers and a sharp decline in the number of rigs drilling for crude in the U.S. likely will slow the nation’s oil-output growth, spurring a rebound in prices, the International Energy Agency said in a report released Tuesday U.K. time. The benchmark U.S. oil price rose 2.3% to $52.86 a barrel on Monday and is up 19% from a nearly six-year low hit last month. The IEA, which […]

Posted On : Published By : Tom Whipple
Category:

OPEC, IEA Reports Hint at a Win for Cartel — 2nd Update

By Sarah Kent And Benoît Faucon In the latest sign that the seven-month selloff in crude-oil prices may be nearing a bottom, an energy watchdog said that a recovery seems "inevitable" and the glut that has driven down prices by more than 50% since June could start to ease as soon as the second half. A wave of spending cuts by oil producers and a sharp decline in the number of rigs drilling for crude in the U.S. likely will slow the nation’s oil-output growth, spurring a rebound in prices, the International Energy Agency said in a report released Tuesday U.K. time. The benchmark U.S. oil price rose 2.3% to $52.86 a barrel on Monday and is up 19% from a nearly six-year low hit last month. The IEA, which coordinates energy policy among industrialized countries, is adding its voice to the chorus of experts who say that the […]

Posted On : Published By : Tom Whipple
Category:

IEA says scope of US shale oil output fall will be limited

Pump jacks are seen in the Midway Sunset oilfield, California, April 29, 2013. The nearby vast Monterey shale formation is estimated by the U.S. Energy Information Administration to hold 15 billion barrels of technically recoverable oil, or four times that of the Bakken formation centered on North Dakota. Most of that oil is not economically retrievable except by hydraulic fracturing, or fracking, a production-boosting technique in which large amounts of water, sand and chemicals are injected into shale formations to force hydrocarbon fuels to the surface. Picture taken April 29, 2013. REUTERS/Lucy Nicholson (UNITED STATES – Tags: ENERGY BUSINESS) – RTXZ5IM The dramatic fall in the oil price will lead to a swift pullback in US shale oil production, although the scale of the output decline will be “limited in scope”, the world’s leading energy forecaster said on Tuesday. The supply build-up hanging over the oil market will grind […]

Posted On : Published By : Tom Whipple
Category:

Iraq was second-leading contributor to global oil supply growth during 2014

Source: U.S. Energy Information Administration, Short-Term Energy Outlook Despite some supply disruptions and security threats, Iraq was the second-leading contributor to global oil supply growth in 2014, behind only the United States. Iraq accounted for almost 60% of production growth among the Organization of the Petroleum Exporting Countries (OPEC), although this growth was more than offset by production declines in other OPEC countries. Iraq’s crude oil production, which averaged almost 3.4 million barrels per day (bbl/d) in 2014, was 330,000 bbl/d above 2013 levels, despite the heightened security threat from the Islamic State of Iraq and the Levant (ISIL) and disrupted production in northern Iraq. Source: U.S. Energy Information Administration, Short-Term Energy Outlook, Iraq Country Analysis Brief ISIL attacks in northern Iraq in early June 2014 reduced northern Iraqi production and refinery operations (not including the Iraqi Kurdistan Region). These attacks did not affect southern production and exports, which […]

Posted On : Published By : Tom Whipple
Category:

In payment drought, oil companies pare KRG investment

TheTaq Taq-Khurmala Oil Pipeline. (KAMARAN NAJM/Metrography/Iraq Oil Report) Iraq’s autonomous Kurdistan Regional Government (KRG) has not paid its oil contractors since November, highlighting political and financial problems that could hamper plans to increase production and exports.“We’re not going to be in a position to invest until we are able to receive more in payments,” said Bijan Mossavar Rahmani, the Executive Chairman of Norway’s DNO, in a Feb. 5 presentation to investors. “Companies expect and were promised payment. And without payment they’re no…

Posted On : Published By : Tom Whipple
Category:

The Battle for Libya’s Oil

The Battle for Libya’s Oil thumbnail The first artillery rounds landed just as the setting sun threw shadows on this barren stretch of coast. Atop an earthen observation berm, a young fighter in an oversize flak vest peered through a makeshift periscope. Six miles away was the prize: white storage tanks filled with oil. Over the walkie-talkie came a hurried voice: “Saadun, Saadun, the bird is here, the bird is here!” Saadun was the codename for a portly commander in the Libya Dawn militia and my escort on the frontline when I visited Libya in January. His men—boys, actually—had teased him earlier for struggling to haul his hefty frame up the berm. The bird was a MiG-21 or MiG-23 fighter-bomber belonging to the rival Dignity forces. An overhead roar gave way to crackling flashes across a cloudless sky—flak from anti-aircraft guns. The MiG dropped its bomb about a mile […]

Posted On : Published By : Tom Whipple
Category:

East African Countries Could Lose Out On Low Oil Prices

Nairobi — East African countries are unlikely to significantly benefit from falling global oil prices due to inadequate storage facilities, a new research paper released by Deloitte East Africa indicates. "East African countries’ failure to set up sufficient oil storage facilities will mean that the region could miss out on a chance to accumulate cheap stockpiles as is the trend abroad," the research note argues. Over the past few months, global oil prices have more than halved, to stand at just below $50 (Sh 4,568) a barrel for the first time since May 2009. Across East Africa, motorists have however complained that the drop in pump prices is not commensurate with the movements in crude oil prices. "The plunge in prices of oil has rekindled the debate whether lower prices are cascading down to drivers such as the cost of electricity (generated from fossil fuels) and if travellers are […]

Posted On : Published By : Tom Whipple
Category:

Nigeria Naira Falls to Record as Devaluation Threat Seen Rising

(Bloomberg) — Nigeria’s naira fell to a record after the West African nation’s decision to postpone elections increased risks the continent’s worst-performing currency will be devalued. The naira retreated as much as 1.5 percent to 199.10 per dollar before paring losses to trade at 199.01 by 11:12 a.m. in Lagos. The currency is depreciating for a seventh day to the weakest level since Bloomberg started compiling the data in January 1999, extending losses this year to 7.8 percent, the most among 24 currencies tracked by Bloomberg. “Traders are seeing higher uncertainties in the market with the postponement of the election,” Lanre Buluro, head of research at Primera Africa Securities Ltd., said by phone from Lagos. “There is speculation on the naira with many buying dollars in anticipation of imminent devaluation before the election or after.” Investors are delaying decisions to commit money to Nigeria as escalating violence by the […]

Posted On : Published By : Tom Whipple
Category:

Venezuela’s Rating Lowered by S&P on Outlook for Economic Policy

(Bloomberg) — Venezuela had its credit rating lowered by Standard & Poor’s, which said the government will struggle to implement changes needed to shore up the economy. S&P cut Venezuela’s long-term rating by one level to CCC, eight notches below investment grade. The outlook is negative, S&P said Feb. 9 in a statement. “Economic recession, high inflation, and growing shortages have weakened public support for the government, likely reducing its political room to introduce difficult corrective economic measures that would improve its external liquidity position,” S&P said. Venezuela’s gross domestic product could shrink as much as 7 percent this year after the 60 percent plunge in prices for oil since June, S&P said. The commodity accounts for 90 percent of exports and the decline in prices means the government has less room to adjust policy and avoid a default, S&P said. “Pressure is growing for the government to reschedule […]

Posted On : Published By : Tom Whipple
Category:

China January inflation hits five-year low

BEIJING (Reuters) – China’s annual consumer inflation hit a five-year low in January while factory deflation worsened, underscoring deepening weakness in the economy and heaping pressures on policymakers to inject more stimulus to underpin growth. The risk of deflation is rising for the world’s second-largest economy as a property market downturn and widespread factory overcapacity have been compounded by an uncertain global outlook and falling commodity prices. A collapse in global oil prices have already unleashed a wave of easings around the world as central bankers from Europe to Canada to Australia sought to defuse the deflationary pressures and bolster their economies. And more policy support is expected from Beijing after the National Bureau of Statistics said on Tuesday that China’s consumer price index rose 0.8 percent in January year-on-year, undershooting expectations of a 1.0 percent rise and marking the weakest reading since November 2009. "Today’s data confirmed the […]

Posted On : Published By : Tom Whipple
Category:

Talisman Takes $1.37 Billion Charge on Falling Crude-Oil Price

(Bloomberg) — Talisman Energy Inc., the Canadian producer being acquired by Spain’s Repsol SA, reported about $1.37 billion in one-time charges for the fourth quarter as it reduced the value of certain assets because of slumping crude-oil prices. “The company partially impaired its investment in the Eagle Ford by $614 million due entirely to price declines, and fully impaired its investment in Block K44 in the Kurdistan region of Iraq by $234 million after determining that future investment in a capital constrained environment was unlikely,” Calgary-based Talisman said in a statement on Marketwired Tuesday. It also wrote down North Sea assets and a joint venture with Colombia’s Ecopetrol SA. Talisman joins other oil companies, including BP Plc, in lowering the value of assets after oil prices fell by more than half from a June high. The industry has cut more than $40 billion in spending and fired thousands of […]

Posted On : Published By : Tom Whipple
Category:

Oil Producers Stress Surviving $50 Oil

Energy investors are focusing on what U.S. independent producers have to say in coming financial sessions about their ability to survive a period of $50 oil after many were geared up for richer crude prices. Photo: Associated Press A year ago, Houston oil and gas company Energy XXI Ltd. was getting ready to take on $1 billion in debt to buy a rival. Its stock climbed toward $24 a share. On Monday, the debt-laden company laid out its strategy for survival after that deal contributed to a $377 million loss for its December quarter. On the list: asset sales, expense cuts and cashing in oil-price contracts it signed before prices tumbled. Shares of the energy producer, which operates in the shallow waters of the Gulf of Mexico, now change hands for less than $4 apiece. “The culture of the company has changed, with more focus on cost savings and […]

Posted On : Published By : Tom Whipple
Category:

A Biofuel Debate: Will Cutting Trees Cut Carbon?

Eduardo Porter Does combating climate change require burning the world’s forests and crops for fuel? It certainly looks that way, judging from the aggressive mandates governments across the globe have set to incorporate bioenergy into their transportation fuels in the hope of limiting the world’s overwhelming dependence on gasoline and diesel to move people and goods. While biofuels account for only about 2.5 percent today, the European Union expects renewable energy — mostly biofuels — to account for 10 percent of its transportation fuel by 2020. In the United States, the biofuel goal is about 12 percent by early in the next decade. The International Energy Agency envisions using biofuels to supply as much of 27 percent of the world’s transportation needs by midcentury. The reasons for such ambitions are clear: It is nearly impossible under current technology to run cars, trucks, ships and jet planes on energy generated […]

Posted On : Published By : Tom Whipple
Category:

There Is No Peak Oil–But We Are Approaching Peak Low-Cost Oil

The collapse in oil prices over the last seven months looks to destabilize the world stage by redirecting over $1.8 trillion in spending if current prices hold. While worldwide demand exceeds 92 million barrels per day , the drop in price from over $105 this past summer to under $50 translates into sizable savings for the average American. Who Gains vs. Who Loses Spread out across all industries, U.S. consumers could be looking at an extra $300 billion in savings this year, since oil touches just about every aspect of daily life in one form or another. The working poor, in particular, will be the largest beneficiaries , since energy expenses constitute a greater percentage of household income for them than for any other group. They will likely feel as though they are getting ahead, for a change, rather than continuing to slip further into the abyss . The impact of “less pain at the pump” […]

Posted On : Published By : ASPO-USA
Category:

Russia Faces Battle Over Billions in Oil Taxes After Crude Slump

OAO Rosneft Chief Executive Officer Igor Sechin, a long-time associate of President Vladimir Putin, discussed the tax regime with Russia’s president last week. Photographer: Andrey Rudakov/Bloomberg (Bloomberg) — Russia, where energy production provides more than half of state revenue, is preparing for a battle with oil producers over taxing the country’s most vital industry. Oil’s rout has made an agreement last year, which reduced export taxes in return for higher levies on extraction, unworkable because the plan was based on $100 a barrel crude. Producers led by state-controlled OAO Rosneft have proposed changes to the tax regime, Deputy Energy Minister Kirill Molodtsov said in an interview. On the brink of its first recession since 2009, Russia’s state coffers are being depleted by lower energy revenue as sanctions and a plunging ruble put further pressure on the economy. While the government must maintain funds from oil, it can’t afford to […]

Posted On : Published By : Tom Whipple
Category:

Who gets left with the unburnable carbon?

Christophe McGlade on who gets left with the unburnable carbon Christophe McGlade is a research associate in energy materials modelling at the UCL Institute for Sustainable Resources.  He recently co-authored, with Paul Ekins, a paper called “The geographical distribution of fossil fuels unused when limiting global warming to 2°C ”, a paper whose stark call to leave the substantial majority of fossil fuels in the ground generated a lot of media coverage in recent weeks (see for example here and here ).   I started by asking him to give an overview of the paper and of its key findings: “The paper is looking at the optimal use of fossil fuels if we want to have a good chance of staying below the agreed 2°C threshold. Within that, it breaks down the amount of oil, gas and coal reserves that are used and aren’t used at a regional level, so […]

Posted On : Published By : Tom Whipple
Category:

Michael Lynch: Forecasts Of Oil Price Bottom And Recovery

For oil price forecasters, it is all but mandatory to start with self-deprecating humor, because the track record is so bad. Late 2013, surveys showed predictions for 2014 of $104 per barrel for Brent. Citi’s forecast of a significant drop raised eyebrows, in fact. Now, one reporter noted that expert forecasts range from $30-200, which is both true and funny, but doesn’t capture the actual expectations, primarily because of the time differential. But once prices were clearly falling, there was a rush to be the most bearish. (I suggested back in December that a floor seemed to have been reached at about $50, although at other points on the way down I believed OPEC would manage to stabilize prices at those levels.) A few have suggested that a price of $20 per barrel might be reached, albeit only briefly, while others have picked a range of $40-50, although mostly […]

Posted On : Published By : Tom Whipple
Category:

Oil’s Rebound Lifts U.S. Stocks, but More Obstacles Lurk

ENLARGE U.S. stocks recovered last week amid hopes that the fall in oil prices might finally be over. The market has been closely tied to oil since 2015 began, so more-stable oil prices would help ease investor concerns. Money managers warned, however, that plenty of other hurdles lurk that could trip up already high-priced stocks in weeks to come, including concerns about corporate earnings and interest rates. As if that weren’t enough, nothing guarantees that oil prices will keep rising, adding another element of uncertainty. In recent years, Federal Reserve cash injections into financial markets have helped cushion the blows from these normal market forces, but the Fed is removing that protection. The Fed ended its bond-buying program last year and is preparing to push interest rates higher this year, so stocks could stay jumpy, said Seth Masters, chief investment officer at Bernstein Private Wealth Management, which oversees $76 […]

Posted On : Published By : Tom Whipple
Category:

Oil dips after weak Chinese trade data

LONDON (Reuters) – Brent crude prices slipped on Monday as a slump in Chinese imports pointed to lower fuel demand in the world’s biggest energy consumer, outweighing falling U.S. oil rig counts and signs of healthy U.S. growth. China’s trade performance slumped in January. Exports fell 3.3 percent from a year earlier while imports tumbled 19.9 percent, highlighting a deepening slowdown. Global benchmark Brent crude oil LCOc1 for March was down 25 cents at $57.55 a barrel by 0845 GMT after rising as high as $59.06 earlier in the session. U.S. crude CLc1 was up 15 cents at $51.84 a barrel, having hit a session high of $53.40. While overall Chinese crude import figures remained high, analysts said signs of a slowdown were weighing on prices. "Opportunistic buying waned in January as a combination of weak demand, high inventories and tight credit conditions impacted import demand," ANZ bank said […]

Posted On : Published By : Tom Whipple
Category:

Tehran Says Now Is the Time for a Deal on Iran’s Nuclear Program

ENLARGE Iranian Foreign Minister Javad Zarif said at the Munich Security Conference on Sunday that the opportunity to reach a deal on Iran’s nuclear program must be seized. Photo: Reuters MUNICH—Iranian Foreign Minister Javad Zarif said on Sunday that now is the time, and perhaps the last chance, for six world powers to seal a final nuclear deal with his government. But Western officials said progress in talks remains slow, and Tehran is resisting their key demand for a significant reduction in Iran’s enrichment activities. Mr. Zarif met twice with U.S. Secretary of State John Kerry this weekend on the sidelines of the Munich Security Conference. He also held talks on Saturday with other foreign ministers from the six-power group with which Tehran negotiates over its nuclear program. Mr. Zarif said that while it wouldn’t be the end of the world if a nuclear deal proved elusive, a final […]

Posted On : Published By : Tom Whipple
Category:

Iran Presses for Progress in Nuclear Negotiations

MUNICH — As consultations continued here on a possible new cease-fire arrangement with Russia and Ukraine , Iran ’s foreign minister, Mohammad Javad Zarif, said on Sunday that Tehran does not favor another extension of the talks on limiting its nuclear program and expects economic sanctions to be quickly lifted if an accord is reached. “Sanctions are a liability; you need to get rid of them if you want a solution,” Mr. Zarif told a security conference. “This is the opportunity to do it, and we need to seize this opportunity,” he said of the long effort to forge an agreement. “It may not be repeated.” The nuclear talks have already been extended twice and face a late March deadline for hammering out the main outlines of an accord. The deadline for completing a detailed agreement is the end of June. With a Republican-led Congress in Washington, an extension […]

Posted On : Published By : Tom Whipple
Category:

Iran’s Khamenei hints ready to accept fair nuclear deal as talks proceed

DUBAI/MUNICH (Reuters) – Iran’s paramount leader suggested on Sunday he could back a fair nuclear accord with world powers in which neither side got everything it wanted, boosting Iranian negotiators under fire from hardliners at home opposed to rapprochement with the West. "I would go along with any agreement that could be made. Of course, I am not for a bad deal. No agreement is better than an agreement which runs contrary to our nation’s interests," clerical Supreme Leader Ayatollah Ali Khamenei said in a statement issued by his office carried by ISNA news agency. But in a message that appeared to back up the conciliatory approach of President Hassan Rouhani, who revived diplomacy with Western powers soon after his landslide election in 2013, Khamenei said: "As the president (has) said, negotiations mean reaching a common point. Therefore, the other party … should not expect its illogical expectations to […]

Posted On : Published By : Tom Whipple
Category:

Libya: Strike Closes Another Oil Export Port

Hariga, an oil export port in Tobruk eastern Libya, has been shut down because of a security guard strike, a port official said, Al Arabiya reported Feb. 8. Hariga was the last functioning export port aside from two offshore fields. Before closing, it exported around 120,000 barrels per day. The guards went on strike the morning of Feb. 7, saying they had not been paid. Libya is in middle of a power struggle between two governments , and the effect on the oil industry has led to a budget crisis. Stratfor provides global awareness and guidance to individuals, governments and businesses around the world. We use a unique, intel-based approach to analyze world affairs. Copyright © 2015 Stratfor Global Intelligence, All rights reserved. Our mailing address is: 221 West 6th Street Suite 400 – Austin, TX 78701, USA unsubscribe from this list     update subscription preferences | forward email […]

Posted On : Published By : Tom Whipple
Category:

Chevron Unit Said to Cut Output From Saudi-Kuwaiti Oil Fields

Oil workers on a Chevron drilling platform near the Saudi Arabian border in Kuwait. Saudi Arabia, the largest producer in the Organization of Petroleum Exporting Countries, and Kuwait, the group’s third-biggest member, will join other OPEC states to assess market conditions and production levels at a June 5 meeting in Vienna. Photographer: Joe Raedle/Getty Images (Bloomberg) — Crude production dropped 20 percent since October at a venture that a Chevron Corp. unit operates in the Wafra fields, which Kuwait is developing with Saudi Arabia, according to two people with direct knowledge of the matter. Daily output dropped to 180,000 barrels from about 200,000 barrels last month and 225,000 barrels in October, said the people, who asked not to be identified because the matter isn’t public. Two rigs are halted and more may be idled in the coming months because Saudi Arabian Chevron Inc. faces problems operating wells due to […]

Posted On : Published By : Tom Whipple
Category:

Two bombs in Baghdad kill 15 civilians: sources

BAGHDAD (Reuters) – At least 15 people were killed in two bombings in and around Baghdad on Monday, police and medical sources said, the latest in a string of deadly attacks to hit the Iraqi capital in the last two weeks. A suicide bombing at a security checkpoint in the Shi’ite neighborhood of Kadhimiya killed 13 civilians and wounded more than 30 others, the sources said. The neighborhood is home to one of the holiest shrines in Shi’ite Islam and is the regular target of such attacks. Two people were later killed when a bomb went off on a main street in a northern suburb, police and medical sources said. No person or group immediately claimed responsibility for the bombings. Islamic State, an al Qaeda offshoot that seized large parts of northern and western Iraq last year, regularly targets Shi’ite neighborhoods in the capital. At least 37 people were […]

Posted On : Published By : Tom Whipple
Category:

New Mideast Oil Refineries Could Stir Up Fuel-Market Dynamics

Shell’s oil refinery in Singapore has been under pressure. ENLARGE Photo: Agence France-Presse/Getty Images SINGAPORE—The startup of two huge oil refineries earlier this year in the Middle East is set to shake up fuel markets from Asia to Europe as the oil-producing region expands its influence beyond just exporting vast amounts of unprocessed crude. The projects, together with a third large refinery that began operating in Saudi Arabia last year, are expected to process 1.2 million barrels of oil a day at full capacity in the next few months, equivalent to slightly more than 1% of the world’s total oil-refining capacity. They will produce a variety of oil products from diesel fuel to gasoline and jet fuel, with diesel making up for more than half the output. Once up and running, the refineries should have considerable competitive advantages, thanks to new technology, cheap crude-oil feedstock and proximity to markets […]

Posted On : Published By : Tom Whipple
Category:

Nigeria Postpones Elections, Saying Security Is a Concern

DAKAR, Senegal — Nigeria ’s election agency on Saturday night put off a closely contested presidential election after weeks of pressure to postpone it from the ruling party, which analysts say was facing potential defeat for the first time in more than 15 years. The move is sure to anger the opposition, which has been arguing against a postponement, and inflame its supporters in a volatile electoral environment. The election, originally scheduled for next Saturday, will now be held March 28, the election agency head told a news conference in Abuja, Nigeria’s capital, late Saturday night. The elections official, Attahiru Jega, after days of what were reportedly heated meetings with the government, cited “security” concerns for the delay. He said that Nigeria’s top military men — themselves close to the government — refused to ensure that security would be “guaranteed” if the vote went ahead as scheduled. The country’s […]

Posted On : Published By : Tom Whipple
Category:

Rich In Oil, Venezuela Is Now Poor In Most Everything Else

Shoppers queue outside the supermarket ‘Dia a Dia’ in Caracas, Venezuela, on Tuesday. The government took over stores of supermarket chain after alleging that it was hoarding food. According to many economists, government controls are making the economic crisis worse. (EPA/Landov) By John Otis, NPR Simon Nobile, 72, runs the Capri pasta factory in the capital Caracas, which was founded by his Italian-born father in 1940. Capri’s two plants crank out 11 million pounds of pasta per month. They could produce nearly twice that much. However, Nobile says a government policy designed to help the poor forces him to sell half of his inventory for just five cents a pound. "There is no incentive because price controls mean that you lose money. So the more you produce, the more money you lose," he says. Another headache is securing the grain to make pasta, says Angie Mendible who works in […]

Posted On : Published By : Tom Whipple
Category:

6000% Increase in Cancer Rates at Fukushima Site

As reports from individuals like Chieko Shiina, a supporter of the Fukushima Collaborateive Clinic talk about exploding rates of thyroid cancer in children, as well as an epidemic of leukemia, heart attacks, and other health problems,  the Abe-led government and US continue to sweep the fall out of the Fukushima disaster under the rug. Cancer rates have exploded at an increase of almost 6000% in areas near the reactor meltdown. Aside from people-on-the-street interviews that a rare media outlet like “Hodo station” will report on, mainstream media stays completely silent. One Japanese resident,  Carol Hisasue, laments  that as the incident has disappeared from the media, it has also disappeared from people’s consciousness. So why does Fukushima continue to be a see no evil, hear no evil event? You can watch an over hour-long report that goes into detail, but to sum it up, people can’t even turn on their gas-stoves near Fukushima because […]

Posted On : Published By : Tom Whipple
Category:

Oil Companies May Keep Up Output to Repay Debt, BIS Report Says

Tumbling oil prices have increased borrowing costs among energy companies, with spreads on high-yield bonds issued by energy firms soaring to 800 basis points, or 8 percentage points, as of January, from 330 points in June, according to the BIS. Photographer: Susana Gonzalez/Bloomberg (Bloomberg) — Energy companies may be slow to cut oil production after a 50 percent price drop because they need to service debt that has risen fourfold since 2003, according to the Bank for International Settlements. “Debt-service requirements may induce continued physical production of oil to maintain cash flows, delaying the reduction in supply in the market,” the Basel, Switzerland-based institution said in a report Saturday. Energy companies’ outstanding debt rose to more than $800 billion this year from less than $200 billion in 2003, said BIS, which is owned by central banks. Sinking oil prices weakened the value of assets used as collateral by producers […]

Posted On : Published By : Tom Whipple
Category:

Pump Prices Rise for First Time Since June, Lundberg Says

The highest price for gasoline in the lower 48 states among the markets surveyed was in San Francisco at $2.59 a gallon, Lundberg Survey Inc. said. The lowest price was in Tucson, Arizona, where customers paid an average $1.82 a gallon. Photographer: Andrew Harrer/Bloomberg (Bloomberg) — The average price of regular gasoline at U.S. pumps rose for the first time since June, climbing 12.72 cents during the past two weeks to $2.1963 a gallon, according to Lundberg Survey Inc. The survey covers the period ended Feb. 6 and is based on information obtained at about 2,500 filling stations by the Camarillo, California-based company. Prices are $1.0981 lower than a year ago. Pump prices had fallen in every Lundberg survey following June 20. Retail gasoline increased as crude oil prices rebounded from the lowest level since 2009. “Crude oil rose in price and the full weight has not yet been […]

Posted On : Published By : Tom Whipple
Category:

US gas prices jump 13 cents a gallon; could go higher

CAMARILLO, Calif. (AP) — The average price of a regular gallon of gas jumped 13 cents in the past two weeks to $2.20, ending a sustained drop. Industry analyst Trilby Lundberg said Sunday that a rebound in the price of crude oil caused the run-up at the pump. However, the price is $1.10 below the mark a year ago, on Feb. 7, 2014. San Francisco continued to have the highest-priced gas in the Lower 48 states at $2.59 a gallon. The low average was in Tucson, Arizona, at $1.82. The average price in California is up 9 cents, to $2.53. Lundberg says pump prices could climb as much as a dime in the near future, unless oil prices show significant declines.

Posted On : Published By : Tom Whipple
Category:

Bigger Container Ships Pose Bigger Risks

ENLARGE As shipping lines seek to cut costs, new container ships larger than the CSCL Globe, one of the biggest such ships now in service, are in the offing or on the drawing board. Photo: Agence France-Presse/Getty Images The big container ships that ply the world’s trade routes are growing ever larger, holding down the cost of ocean shipping, but also raising concerns among vessel operators, insurers and regulators about the potential for catastrophic accidents. The ships, designed to carry freight stowed in large metal containers, transport much of the world’s seaborne cargo, including manufactured goods and, increasingly, farm products. Their increasing size already is straining the unloading resources at some port facilities and—along with labor troubles—has contributed to major traffic snarls at the nation’s West Coast ports. Since the economic downturn, shipping lines have sought to stay competitive by running larger, more fuel-efficient container ships in major shipping […]

Posted On : Published By : Tom Whipple
Category:

Oil ‘contango’ puts profit in storage

Price sensitive: oil storage facilities in Cushing Anyone seeking to understand oil’s fall should watch what is happening in Cushing, Oklahoma. The little city of 7,900 people is also home to tanks capacious enough to hold 70.8m barrels of crude, by the government’s latest reckoning . There, oil stocks have doubled since October to 41.3m barrels — a tenth of US commercial inventories. In a “few months it will be full”, Alan Swanson, chief financial officer at tank owner Plains All American Pipeline , told analysts last week. More On this topic IN Commodities Cushing’s rising occupancy rate shows how much supply exceeds demand even with US crude at $52 a barrel. With North American production still booming, it’s pouring into tanks in places like Cushing ; the Gulf coast of Texas; and Hardisty, Alberta. Cushing is watched most closely, as it is the delivery point for the benchmark […]

Posted On : Published By : Tom Whipple
Category:

How environmental activists turned a pipeline into a climate movement

WASHINGTON— In the summer of 2011, James Hansen, then the director of NASA’s Goddard Institute for Space Studies, raised the alarm about an obscure oil pipeline project that appeared to be on track  for approval, just as hundreds of others like it had in the years prior.    The 1,179-mile proposed pipeline would transport crude oil extracted from Canada’s tar sands—a particularly intensive process that produces 17 percent more emissions than conventional extraction—to refineries on the Gulf Coast. “The U.S. Department of State seems likely to approve a huge pipeline to carry tar sands oil (about 830,000 barrels per day) to Texas refineries unless sufficient objections are raised,” Hansen, one of the world’s foremost climate scientists, wrote in an essay entitled “Silence is Deadly.” “An overwhelming objection is that exploitation of tar sands would make it implausible to stabilize climate and avoid disastrous global climate impacts.” Hansen argued constructing […]

Posted On : Published By : Tom Whipple
Category:

Russia Picks ‘Strategic’ Companies Eligible for State Support

By Andrey Ostroukh MOSCOW–Russia’s government has picked 199 "strategic" companies that will have state legal support and a greater crack at bailouts, the economy ministry said Sunday. Russia is preparing for its first economic recession since 2009, suffering from massive capital flight and double-digit inflation. The government, which has limited funds when global capital markets are closed to it because of Western sanctions, is looking for ways to save the economy from a deeper collapse. It has picked companies, including the country’s largest oil producer Rosneft and gas monopoly Gazprom, that collectively generate 70% of Russia’s national income and employ more than 20% of the working population across the country. This should steady the economy and mitigate the effects of the crisis, the economy ministry said in a statement. Inclusion on the list of strategic companies doesn’t guarantee a state-funded bailout, the ministry said. Late last month, the government […]

Posted On : Published By : Tom Whipple