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Diesel in N.Y. Jumps as Freeze Boosts Demand, Slows Deliveries

(Bloomberg) — Diesel futures jumped the most in more than a year as cold weather in the Northeast boosted demand while refinery outages reduced supplies. The March contract rose as much as 7.2 percent as Delta Air Lines Inc. shut units at its Trainer refinery in Pennsylvania and Philadelphia Energy Solutions had an upset at its complex, the largest on the East Coast. Natural gas pipelines in the eastern U.S. have limited flows across their systems as cold weather spreads through the region. “This is a result of the natural gas curtailments that continue through the region,” said Andy Lipow, president of Lipow Oil Associates LLC in Houson. “Compounding the problem is the fact that the Delta Trainer refinery shut down units.” Diesel for March delivery rose 9.47 cents, or 4.7 percent, to $2.0885 a gallon at 10:51 a.m. on the New York Mercantile Exchange. The front-month contract’s premium […]

Posted On : Published By : Tom Whipple
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Arctic Oil Drillers Face Tighter U.S. Rules to Stop Spills

(Bloomberg) — Royal Dutch Shell Plc and any oil drilling company that prospects in the Arctic Ocean must boost safety practices to prevent spills in the frigid and often hostile waters or mitigate the impact, U.S. regulators proposed Friday. The Interior Department’s first Arctic-specific drilling rules respond to mishaps that plagued Shell as it sought oil north of Alaska three years ago. As the White House considered the plan, Shell said the requirements might make it too expensive to invest in the isolated but energy-rich waters. “The Arctic region is known for its challenging environmental conditions, geographic remoteness and relative lack of existing infrastructure,” according to the proposal from the department’s offshore safety agency. There is a “need to develop additional measures specifically tailored to the operational and environmental conditions of the Arctic.” Shell has said it wants to resume exploration when the weather gets warmer this year after […]

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Chevron Dry Holes Rate Almost Doubles Amid Shift to Americas

(Bloomberg) — Chevron Corp.’s exploration failure rate almost doubled last year as the second-largest U.S. energy producer shifted more drilling efforts to American fields from other parts of the world. Dry holes, or exploratory wells where commercially viable quantities of oil or natural gas weren’t found, represented 30 percent of the total drilled last year, up from 18 percent in 2013, the company said Friday in a public filing. Chevron plans to quit searching Romania’s shale fields this year after abandoning Polish and Ukrainian prospects in 2014. Chevron is accelerating spending cuts that got underway last year as falling crude prices eroded cash available for exploratory drilling, platform construction and other capital projects. The San Ramon, California-based company last month said it plans to reduce outlays by 13 percent this year to $35 billion, more than three times the 3.7 percent cut during 2014. The oil and gas producer […]

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Amid controversy, oil trains quietly rerouted through Virginia towns

(Reuters) – Hundreds of communities across the United States have become accustomed to the sight of mile-long oil trains rumbling by in recent years. Pembroke, Virginia, was not one of them, until now. CSX Corp is temporarily rerouting up to five oil trains through this small riverside town to bypass the site of an explosive oil train derailment that occurred 90 miles north in Mount Carbon, West Virginia, on Monday. The trains will likely travel instead on a track that hugs the New River and at one point sweeps into the Pembroke town limits. In line with a federal protocol established last year following a string of fiery derailments across North America, the Virginia Department of Emergency Management on Tuesday informed 16 counties and cities that oil trains could be coming through their towns, local officials and fire departments said, one day after the Mount Carbon derailment. Those counties […]

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Kiev accuses Russia of sending more tanks to east Ukraine

DEBALTSEVE, Ukraine/KIEV (Reuters) – Kiev accused Russia on Friday of sending more tanks and troops into eastern Ukraine and said they were heading towards the rebel-held town of Novoazovsk on the southern coast, expanding their presence on what it fears could be the next battlefront. Russia did not immediately respond to the accusation which, if confirmed, would go further to kill off a European-brokered truce that was met by relentless rebel advances after it came into force on Sunday. Moscow has always denied accusations in the past that its forces are fighting in Ukraine. Nevertheless, there were signs that the rebels may be prepared to halt their advance, having achieved their main military objective this week by seizing the strategic town of Debaltseve in defiance of the ceasefire. Reuters journalists in the battle zone, including Debaltseve itself now firmly in rebel hands, said it was quieter than it had […]

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Gazprom Neft ships first winter oil from arctic

Russian energy company Gazprom Neft shifts first winter batch of oil from field located above the Arctic Circle. Photo courtesy of Gazprom Neft Gazprom Neft said Friday it made its first ever winter shipment of oil from a field located above the Arctic Circle. The company said 117,280 barrels of crude was shipped on a tanker to European consumers from the Novoportovskoye, or Novy Port, field in the Yamal Peninsula under the escort of an icebreaking ship. Board Chairman Alexander Dyukov said his company has invested "significant funds" in developing a commercial-scale arctic oil operation. "We are continuing to actively develop these projects, and in just a few years they will account for a significant part of Gazprom Neft’s production," he said in a statement. Greenpeace has objected to Russian efforts to extract oil from the arctic, saying it poses a risk to the pristine ecosystem there. Greenpeace last […]

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Russia Gets Second Junk Rating From Moody’s on Ukraine, Oil

Russia’s credit rating was cut to junk by Moody’s Investors Service as the conflict in Ukraine and plunging oil prices curb growth and erode financial stability. Photographer: Akos Stiller/Bloomberg (Bloomberg) — Russia’s credit rating was cut to below investment grade by Moody’s Investors Service, which joined Standard & Poors in ranking the country’s debt as junk, citing the conflict in Ukraine and plunging oil prices. The rating company downgraded Russia one step to Ba1, the highest non-investment level and in line with countries including Hungary and Portugal. Moody’s has a negative rating outlook on the country, according to a report released Friday. The move follows Standard & Poor’s decision to cut the country to speculative grade in January. “The existing and potential future international sanctions, the erosion of the country’s foreign exchange buffers and persistently lower oil prices plus high and rising inflation will take a negative toll on […]

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Nato must prepare for Russian attack, warns UK general

A Nato exercise in Estonia Nato forces must prepare for a large-scale conventional assault by Russia on an eastern European member state designed to catch the alliance off guard and snatch territory, the deputy supreme commander of the military alliance has warned. Openly raising the prospect of a conventional armed conflict with Russia on European soil, the remarks by Sir Adrian Bradshaw, second-in-command of Nato’s forces in Europe, are some of the most strident yet from the alliance. The warning comes as relations with the Kremlin worsen just days into a second fragile ceasefire aimed at curbing the bloodshed in eastern Ukraine between Kiev’s forces and Russian-backed separatists. Speaking at the Royal United Services Institute think-tank in London on Friday, Sir Adrian said that as well as adapting to tackle the “hybrid” military tactics — a combination of conventional, irregular and cyber warfare techniques — being used by Russia […]

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Oil falls below $60 as oversupply weighs

LONDON (Reuters) – Brent crude oil fell below $60 a barrel on Friday as oversupply, supported by record-high U.S. crude stocks, weighed on the market. U.S. crude inventories rose 7.7 million barrels to 425.6 million last week, rising for a sixth straight week to record highs, data from the Energy Information Administration (EIA) showed on Thursday. Stockpiles of West Texas Intermediate (WTI) U.S. crude at the Cushing oil hub in Oklahoma rose the most in six years, the EIA said. "With total crude stocks now about 425 million barrels and Cushing north of 46 million barrels, WTI is looking increasingly mispriced high above $52 per the April contract," said Jeffries Futures analysts in a note to traders. Brent crude futures for April were down 27 cents at $59.94 by 0915 GMT, having hit an intraweek low of $57.80 in the previous session. U.S. crude for March delivery CLc1 was […]

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Oil falls sharply as U.S. crude inventories rise

LONDON (Reuters) – Oil prices tumbled on Thursday after another big weekly build in U.S. crude inventories and a possible rise in Saudi output stoked worries about oversupply. U.S. crude stocks rose by 14.3 million barrels last week, data from industry group the American Petroleum Institute (API) showed after Wednesday’s settlement, compared with analysts’ expectations for an increase of 3.2 million barrels. [API/S] If U.S. Energy Information Administration (EIA) data due at 1600 GMT confirms the large build, it would be the biggest weekly addition in barrels since such data became available in 1982. The API and EIA reports are a day late this week because of a U.S. holiday on Monday. At 0843 GMT, benchmark Brent crude futures for April were down $1.67 at $58.86 a barrel, extending declines from Tuesday’s two-month high of $63. U.S. crude for March delivery, which expires on Friday, was down $2.05 at […]

Posted On : Published By : Tom Whipple