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Europe’s Energy Independence Drive Goes off the Rails

A year ago, Russia’s lunge into Ukraine seemed to be focusing European minds on the dangers of depending on Moscow for their energy supplies, pushing countries across the continent to scramble onto the shale-gas bandwagon in a quest to copy U.S. success and move towards having the ability to produce all the energy they need on their own. But now, after a series of disappointments from one end of Europe to the other, Europe’s shale dreams seem to have all but evaporated. And that makes it increasingly unlikely that Europe will be able to reap the kind of gas-fired benefits that have rejuvenated sectors of the U.S. economy and greatly reduced American reliance on foreign energy. That will have implications for both Europe’s economic competitiveness and its energy security at a time when a sluggish economy and a snarling Russia worry European leaders in equal measure. The latest blow […]

Posted On : Published By : Tom Whipple
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Russian Foreign Reserves Fall to Lowest Since 2009 on Euro Slide

(Bloomberg) — Russia’s international reserves fell to the lowest in almost six years as the weakening euro caused a currency revaluation and the central bank intervened to stem the ruble’s depreciation. The value of the stockpile, which includes the central bank’s holdings and two sovereign wealth funds, declined $9.25 billion in January to $376.2 billion, the Bank of Russia said Friday on its website. That compares with a $33.4 billion plunge in December, when the central bank tried to arrest the ruble’s slump to record lows. Russia sold $2.3 billion in market interventions last month, according to central bank data. Policy makers have relied on their reserves to mount a defense of the ruble after it went into a tailspin in December. While President Vladimir Putin said Russia won’t “mindlessly burn up” reserves to defend its currency, the central bank spent about $88 billion of reserves on interventions last […]

Posted On : Published By : Tom Whipple
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Kremlin: West declared economic war on Russia

West has declared economic war on Russia with sanctions, foreign ministry spokesman says. Photo by Denis Larkin/Shutterstock MOSCOW, Feb. 6 (UPI) — Low credit ratings issued against a Russian economy crippled by low oil prices and sanctions are part of a Western economic war, a Kremlin official said Friday. Russian Foreign Ministry spokesman Alexander Lukashevich said credit downgrades are based on the political motives of Western powers frustrated with Kremlin policies. "The use of targeted and deliberate downgrades of ratings of Russian companies and the sovereign rating of the country has become a part of the U.S. and EU economic war against us," he said. Standard & Poor’s in January cut Russia’s foreign currency rating to junk status. Russia’s currency, the ruble, continues to lose value, trading Friday at 67 to the U.S. dollar, down about 6.25 percent from the start of the year. Low oil prices and pressure […]

Posted On : Published By : Tom Whipple
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Russia May Cut 15% of Oil, Gas Investments if Oil Prices Stay Low

MOSCOW–Russian Energy Minister Alexander Novak said Friday that about 15% of investments in the country’s oil and gas projects may be cut if oil prices remain at current levels, Russian news agencies report. The comments come as the country’s energy companies, including OAO Rosneft (ROSN.MZ) and the country’s second-largest gas company OAO Novatek (NVTK.MZ), have sought government help in plugging holes in their budget amid sliding oil prices. Russia may withdraw up to 500 billion rubles ($7.45 billion) from the reserve fund, tapping the coffers for the first time in six years. Write to Olga Razumovskaya at [email protected]

Posted On : Published By : Tom Whipple
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Kremlin talks on Ukraine yield little but agreement to keep talking

DEBALTSEVE, Ukraine/MOSCOW (Reuters) – The leaders of France and Germany flew out of Moscow in the dead of night after five hours of talks with Vladimir Putin on Friday, with little to announce to end fighting in Ukraine beyond a promise to keep talking. None of the leaders spoke publicly after the meeting, which ended around midnight with President Francois Hollande and Chancellor Angela Merkel whisked straight from the Kremlin back to the airport. The French and German leaders had held similar late talks the night before with Ukrainian President Petro Poroshenko, part of a last-ditch push for a breakthrough before EU leaders consider new financial sanctions against Russia next week. European officials had played down expectations ahead of the Moscow talks, expressing doubt that Putin would compromise while pro-Russian rebels are advancing on the ground. Afterwards, Moscow and Berlin both described a commitment to work on a "possible […]

Posted On : Published By : Tom Whipple
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The World After Cheap Oil

The World After Cheap Oil thumbnail The World After Cheap Oil By Rauli Partanen, Harri Paloheimo and Heikki Waris 250 pp. Routledge – Oct. 2014. $59.95. Toward the end of this book, its authors make an astute, if self-deprecating, observation about its potential merits. They’ve been discussing how innate human biases cause us to make cognitive errors when trying to make sense of world crises. They’ve described in particular the tendency of scientifically knowledgeable people to become less convinced about climate change the more evidence they encounter for it, due to confirmation bias. For the authors, this fact “raises the question of how meaningful writing this book has actually been.” Won’t skeptical readers simply cherry-pick the data that support their views and reject the rest? While it is, of course, correct that some readers will do this, there’s no question that writing the book has been meaningful. Indeed, in […]

Posted On : Published By : ASPO-USA
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Opinion: 5 reasons Peak Food is the world’s No. 1 ticking time bomb

Terraced rice paddy fields are seen during the harvest season in Mu Cang Chai, northwest of Hanoi. Global food poisoning? Yes, We’re maxing out. Forget Peak Oil. We’re maxing-out on Peak Food. Billions go hungry. We’re poisoning our future, That’s why Cargill, America’s largest private food company, is warning us: about water, seeds, fertilizers, diseases, pesticides, droughts. You name it. Everything impacts the food supply. Wake up America, it’s worse than you think. We’re slowly poisoning America’s food supply, poisoning the whole world’s food supply. Fortunately Cargill’s thinking ahead. But politicians are dragging their feet. They’re trapped in denial, protecting Big Oil donors, afraid of losing their job security; their inaction is killing, starving, poisoning people, while hiding behind junk-science. The truth is, America, Big Ag worldwide farm production can’t feed the 10 billion humans forecast on Planet Earth by 2050. Can we wait till 2050 for the fallout? […]

Posted On : Published By : ASPO-USA
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These Experts Know Exactly Where Oil Prices Are Headed

Oil Drilling Site And Gas Plant Operated By MOL Hungarian Oil & Gas Plc The outlook on oil prices is clear: Oil will crash. Unless prices surge. Definitely one or the other. Crude just had the biggest two-week gain in 17 years, but it’s still about 50 percent cheaper than it was in June. The situation is volatile, and forecasts are all over the place — from $30 a barrel predicted by the president of Goldman Sachs to as high as $200 a barrel seen by the head of OPEC. So what’s going to happen next? Here’s a sampling of predictions from the last two weeks: Oil could fall as low as $30 because supply surpluses won’t disappear overnight, said Barclays analyst Miswin Mahesh. Oil has the potential climb to $200 per barrel from a lack of investment in new supply, warned OPEC’s Secretary General Abdell El-Badri. “If you don’t […]

Posted On : Published By : Tom Whipple
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Commodities explained: Oil and rig counts

Commodities explained: Oil and rig counts thumbnail The weekly US rig count data, published on Friday, have generated considerable excitement in the oil markets recently, with the numbers released by oil-services group Baker Hughes moving crude prices. What’s going on? The numbers identify the level of drilling activity and have traditionally been regarded as a gauge for the health of the US oil industry. They have come under the spotlight since the oil markets have tanked and traders and investors try to figure out what low prices mean for US shale production. The latest figures showed that oil rigs have fallen 24 per cent from the recent peak of 1,609 in October last year. Last Friday’s figures were particularly stark, with 7.1 per cent of all US rigs idled in one week. OK, but what is a rig, exactly? These are not the big oil platforms in the North […]

Posted On : Published By : Tom Whipple
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Here’s One Theory for Why Oil Is Going Nuts

Here’s One Theory for Why Oil Is Going Nuts thumbnail Brent oil surged to $58 a barrel on Tuesday. It is now 24 percent higher than it was just a few weeks ago, meeting the technical definition of a bull market. (Some perspective: Prices are still down 50 percent since June.) One possible reason for the recent surge: an industry in despair. U.S. drillers idled 94 rigs  last week, the most in data going back to 1987, according to Baker Hughes. In the past eight weeks, 352 rigs were idled. BP on Tuesday said it will reduce spending to $20 billion this year, compared with previous guidance of as much as $26 billion. The cuts bring renewed focus to rig counts and raise questions about how low prices can go and still sustain the U.S. oil boom. U.S. Rigs Fall to a Three-Year Low Source: Bloomberg The history of oil prices follows a golden rule: […]

Posted On : Published By : Tom Whipple