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Diesel Falls Most Since 2008 as Cargoes Steam to East Coast

(Bloomberg) — Diesel futures fell the most in more than six years as East Coast refineries restarted units and traders aimed cargoes at New York. The March contract fell 8.5 percent after rising 11.2 percent the past two trading days. Philadelphia Energy Solutions showed activity in a unit that’s been shut since Feb. 8, according to Genscape Inc. Shippers booked 35 tankers to carry oil product cargoes to the East Coast in the past seven days, compared with 27 the previous week, according to provisional fixture data compiled by Bloomberg. “It’s been super volatile to say the least,” said Andrew Lebow, senior vice president at Jefferies Bache LLC in New York. “You had an extreme move to the upside. Now there are cargoes, and the Northeast refiner issues that looked like they would be longer term, now they’re not.” Ultra-low-sulfur diesel for March delivery fell 18.9 cents to settle […]

Posted On : Published By : Tom Whipple
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U.S. shale oil’s crash diet likely to bring forward output dip

HOUSTON (Reuters) – Shale oil producers are throttling back so quickly on drilling that U.S. crude output could fall sooner than expected, within months, executives say as they slash costs to cope with tumbling crude prices and compete with Persian Gulf rivals. About a dozen chief executives who talked to Reuters or who spoke publicly, acknowledged they were taken aback by the scale and speed of the cutbacks, noting how this oil price downturn was different from several previous episodes in their careers. For one, companies are cutting costs deeper and faster than before as Wall Street investors increasingly place a premium on capital discipline rather than just production growth. Some also say the nature of shale makes it easier for companies to defer work and wait for prices to recover. The wells that drove the U.S. energy boom of the last decade rapidly deplete, so overall output will […]

Posted On : Published By : Tom Whipple
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Oil Refiners Enjoy a Snow Day

ENLARGE Boston’s pain is oil refiners’ gain. Cold weather combined with the persistent problem of natural-gas pipeline bottlenecks in the Northeast translate into higher demand for fuel oil to run generators and heat homes. Meanwhile, that same freeze caused several East Coast refineries to curtail output last week. Futures for fuel oil and diesel have jumped, meaning big profits for those refiners that can keep producing. The 3:2:1 crack spread—a benchmark theoretical refining margin—has jumped 50% to $18 a barrel in roughly the past month, according to FactSet. Futures prices for ultralow-sulfur diesel are at their highest ratio to the West Texas Intermediate crude oil benchmark ever, according to a report from JBC Energy on Tuesday. Additionally, a strike involving the United Steelworkers is spreading slowly across the U.S. refining sector, tightening the products market further. Winter weather may pass, but one other tailwind for refiners has re-emerged in […]

Posted On : Published By : Tom Whipple
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Rivals Hit Oil Exporter That Opened U.S. Spigot

ENLARGE Oil companies using Enterprise Products terminals on the Houston Ship Channel say its loading fee are raising costs on their exports. Photo: Corbis A Houston pipeline company became the envy of the energy industry last year when it found a way around the decades-old legal ban on exporting U.S. oil. But now several oil companies have turned on the company, Enterprise Products Partners LP, complaining it is trying to dominate the lucrative export business and muscle out competitors. Companies including BP PLC have complained to the U.S. Federal Trade Commission, which is investigating, according to people familiar with the matter. The commission, BP and Enterprise all declined to comment on the probe. But people in the industry say it stems from Enterprise’s purchase last fall of a rival pipeline and logistics firm, Oiltanking Partners LP. The $5.9 billion deal gave Enterprise control of the single largest oil-storage operator […]

Posted On : Published By : Tom Whipple
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New PNNL electrolyte may enable use of lithium anodes in very high capacity advanced batteries

« French Post Office and Renault Trucks testing electric truck with fuel cell range extender | Main | Proterra introduces new extended range battery pack for electric transit buses; up to 180 miles » Researchers at Pacific Northwest National Laboratory (PNNL) have developed a new electrolyte that allows lithium-sulfur, lithium-metal and lithium-air batteries to operate at 99% efficiency, while having a high current density and without growing dendrites that short-circuit rechargeable batteries. An open-access paper on their work is published in the journal Nature Communications . “ This new discovery could kick-start the development of powerful and practical next-generation rechargeable batteries such as lithium-sulfur, lithium-air and lithium-metal batteries ,” said PNNL physicist Ji-Guang Zhang, corresponding author of the paper. Lithium (​Li) metal is an ideal anode material for rechargeable Li batteries due to its extremely high theoretical specific capacity (3,860 mAh g −1 ), low density (0.534 g cm −3 ) and the […]

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The shale oil “miracle”: how growth may falsely signal abundance

Oil production (all liquids in barrels per day) in the US and Canada. (From Ron Patterson’s blog ). Does this rapid growth indicate that the resources are abundant and that all the worries about peak oil are misplaced? Maybe not…. Sometimes, we use a simple metric to evaluate complex systems. For instance, a war is a complex affair where millions of people fight, struggle. suffer, and kill each other. However, in the end, the final result is seen in terms of a yes/no question: either you win or you lose. Not for nothing, General McArthur said once that “ there is no substitute for victory” . Now, think of the economy: it is an immense and complex system where millions of people work, produce, buy, sell, and make or lose money. In the end, eventually, we think that the final result can be described in terms of a simple […]

Posted On : Published By : Tom Whipple
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Russia Heightens Dispute With Ukraine Over Natural Gas

MOSCOW — As Russia warned Ukraine on Tuesday that it could run out of natural gas within two days because of a dispute over payments, Britain said it was sending military trainers to aid Ukrainian forces while European diplomats labored to patch up a flagging peace agreement in eastern Ukraine . The warning by Aleksei B. Miller, the chief executive of Gazprom, the state-controlled Russian energy behemoth, illustrated how the hostilities between Russia and Ukraine are hardly limited to the battlefields in eastern Ukraine, where a cease-fire agreed to nearly two weeks ago has still not fully taken hold . Russia has long used its muscle as the region’s major energy supplier to wield political and economic influence, particularly in disputes with Ukraine and other former Soviet republics. A bitter feud over gas payments has been a subplot of the wider political dispute between Moscow and Kiev over the […]

Posted On : Published By : Tom Whipple
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Gazprom threatens to cut Ukrainian gas supplies

Russian energy company Gazprom says Ukraine may face gas shortages within two days. Igor Golovniov/Shutterstock Ukraine’s natural gas contract with Gazprom calls for a pre-payment mechanism. Unless a payment registers in the company’s account within two days, Gazprom Chief Executive Officer Alexei Miller said the spigot would be closed . "The supply of gas to Ukraine at the ordered amount … will result in a full stop of Russian gas supplies to Ukraine, which creates serious risks to gas transit to Europe," he said. Gazprom in the winters of 2006, 2009 and 2014 cut gas deliveries through Ukraine briefly in response to contractual disputes with Kiev. That left downstream consumers in Europe short on natural gas supplies. The row sparked concerns from European leaders over the influence Gazprom has over the regional energy markets, leading policymakers to create measures to deter companies from controlling natural resources and transit arteries. […]

Posted On : Published By : Tom Whipple
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U.K. North Sea Oil’s 1,500 Job Cuts This Year Is Tip of Iceberg

Total SA’s Elgin platform is seen in the North Sea, U.K. Companies looking to cut back include Total, which said Feb. 12 it will reduce investment in mature North Sea fields. Source: Total E&P UK via Bloomberg (Bloomberg) — The world’s biggest oil and gas producers, already cutting hundreds of jobs a week from the U.K.’s North Sea, are just warming up. BP Plc, Royal Dutch Shell Plc and Total SA are among those reducing staff, curbing investment or closing operations as oil prices that have fallen by half since June add to troubles from rising costs and aging resources. About 1,500 jobs have been lost in offshore oil and gas this year, according to Unite, Britain’s largest labor union. Ian Wood, author of a state-commissioned report into the needs of the offshore fossil-fuel business, warned that about 15,000 positions relying on the industry could disappear in months. “The […]

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EU dairy export focus shifts from Russia to Far East as supply rises

BIRMINGHAM, England (Reuters) – The European Union is aiming to boost dairy exports to the Far East and parts of Africa as its seeks to cope with increased production and the loss of sales to Russia, EU farm commissioner Phil Hogan said in an interview on Tuesday. Hogan said there had been a 5-1/2 percent increase in milk production in the EU last year which coincided with the loss of a key export market, Russia. Russia banned imports of dairy products from the EU last August as part of its response to EU sanctions imposed over the Ukraine crisis. "It (the situation with Russia) is not going to get better in the short term," Hogan, an Irish politician who became EU farm commissioner in November last year, said. "In my view therefore we have to look outside the conflicts and the geopolitical regions like Russia, Ukraine to see where […]

Posted On : Published By : Tom Whipple