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Kurdish peshmerga, IS reach stalemate

Kurdish peshmerga fighters walk with their weapons as they take control of an area on the outskirts of Mosul, Feb. 6, 2015. (photo by REUTERS/Ari Jalal) MULA ABDULA, Iraq — "How are the skies?" a gruff voice asks in Iraqi Arabic dialect. "The skies are clear," is the reply, after a crackle of static on the walkie-talkie through which a Kurdish major is listening to the conversation between two Islamic State (IS) militants on the other side of this front line, southwest of Kirkuk in Northern Iraq. An irrigation canal no wider than 10 meters (33 feet) separates the lightly armed Kurdish peshmerga forces from the extremist militants in Mula Abdula, where Maj. Aziz Ahmad stands behind a defensive berm, holding the walkie-talkie up to intercept the enemy’s communications. “They change the frequency regularly and it is not easy to intercept,” he told Al-Monitor. "IS is terrified of bomber aircraft, especially the French.” With the help of coalition […]

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Saudi Arabia Plans to Increase Refining Capacity

ENLARGE A storage tank at the Jubail refinery in Saudi Arabia. The country plans to become the world’s second-largest exporter of refined oil products in 2017. Photo: Associated Press JAZAN—Saudi Arabia plans to become the world’s second-largest exporter of refined oil products in 2017 as part of its drive to diversify its economy and increase its share of the global crude and petroleum products markets, the kingdom’s oil minister Ali al-Naimi said Wednesday. “We are no longer limited to exporting crude oil,” Mr. al-Naimi told a conference in this port city in southwest Saudi Arabia. The kingdom’s two new refineries will add 800,000 barrels a day in refining capacity this year. A planned 400,000-barrel-per-day oil refinery in Jazan will bring Saudi Arabia’s refining capacity to more than 3 million barrels a day, Mr. al-Naimi said. “That will make the kingdom one of the five largest countries in the world […]

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Shale Gas Project Encounters Determined Foes Deep in Algerian Sahara

ALGIERS — Deep in the Algerian Sahara, daily protests against a pilot hydraulic fracturing, or fracking, project are now well into their second month. The demonstrations have spread to several towns and have provided opposition parties with a new platform at an especially precarious moment for the government, as oil prices have slumped and the declining health of President Abdelaziz Bouteflika has removed him almost completely from public view. Hundreds of police officers sealed off streets to block an antifracking march in the capital, Algiers, on Tuesday as opposition groups held rallies around the country in solidarity with the southern protesters in the distant oasis town of Ain Salah. At first glance, Algeria might seem an unlikely place for the sort of popular movement against fracking, a method of tapping into deep deposits of shale gas, that has unfolded in many Western countries. Money from oil and gas accounts […]

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Downgrade of Brazil Oil Giant Stirs Wider Concern

The Petrobras logo is seen at a refinery in Cubatao, Brazil, on Tuesday. ENLARGE Photo: Reuters SÃO PAULO—A decision by a major credit-rating firm to downgrade to junk status the debt of Petróleo Brasileiro SA is stoking fears that Brazil’s sovereign rating could be next. Moody’s Investors Service late Tuesday slashed the debt of the company, known as Petrobras, two notches to Ba2, two steps below investment grade, on continued concern about the fallout from a corruption scandal and the state-run oil giant’s ability to pay down about $135 billion in debt. The downgrade was the third by Moody’s since October. Still, the size and timing of Tuesday’s cut surprised some analysts and sent the country’s leaders into a defensive crouch. Brazil’s largest company, Petrobras plays an outsize role in the nation’s economy, which is flirting with recession. Petrobras’s newfound junk status is “an unequivocal blow” to the administration […]

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Nigeria Cuts Forecasts for Oil Price, Currency for This Year

ABUJA, Nigeria—Nigeria on Wednesday cut its forecast for oil prices and the value of its currency this year, an acknowledgment of the pain tumbling energy costs are inflicting on Africa’s top crude producer. The senate voted to cut its benchmark expectation for oil prices this year to $52 a barrel, from $65 in December. Senators also pegged the average value of the local currency, the naira, this year at 190 to the U.S. dollar, well below the previous target of 165 to the greenback. Brent crude traded at about $59 a barrel on Wednesday and one dollar was worth about 200 naira. The currency has plunged to record lows this year as oil prices have lingered at about half their value just six months ago. Nigeria, Africa’s biggest economy, draws about 70% of government revenue and most of its foreign exchange earnings from its oil output. The plummeting value […]

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Tissue Paper-for-Venezuelan Oil Swap Offered by Trinidad

People queue up outside a supermarket in Caracas. Photographer: Federico Parra/AFP via Getty Images (Bloomberg) — Venezuela, plagued with shortages of basic goods, was offered a reprieve by the Prime Minister of neighboring Trinidad & Tobago: exchange oil for tissue paper. Prime Minister Kamla Persad-Bissessar suggested an oil-for-tissue swap in a news conference Tuesday following a meeting in Port of Spain with Venezuelan President Nicolas Maduro. She said the deal would benefit both countries. “The concept of commodity sharing is simple -– the Government of Trinidad and Tobago will purchase goods identified by the Government of Venezuela from T&T’s manufacturers, such as tissue paper, gasoline, and parts for machinery,” Persad-Bissessar said. In Venezuela, which has the world’s largest oil reserves, citizens line up outside supermarkets for hours seeking a bag of clothing detergent, toilet paper or cooking oil. Price controls and a lack of dollars for importers have emptied […]

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Venezuela Seeks Annulment of Exxon Award at World Bank Tribunal

CARACAS, Feb 25 (Reuters) – Venezuela has requested the annulment of a World Bank tribunal award that orders it pay Exxon Mobil Corp $1.6 billion in compensation for nationalizations, both sides said on Wednesday. George Kahale, Venezuela’s lawyer, said he did not know when the tribunal was likely to issue a decision on the request. "The first step is for the appointment of the committee to hear the annulment application, and that has not happened yet," said the lawyer with Curtis, Mallet-Prevost, Colt & Mosle LLP. "The schedule for the annulment process will not be determined until after the committee is appointed." Exxon said earlier on Wednesday the South American OPEC country had filed for an annulment of the International Centre for Settlement of Investment Disputes award on Feb. 2. "The application alleges that, in issuing the ICSID award, the Tribunal exceeded its powers, failed to state reasons on […]

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Kazakhstan expects oil production boom

Kazakh government expects oil boom once troubled Kashagan oil field resumes operations. (Photo: North Caspian Operating Co.) Kazakhstan’s government said Wednesday it expects oil production to increase by as much as 30 percent in part because of operations at its giant Kashagan field. Kashagan is among the largest oil fields in the world, with an estimated 16 billion barrels of oil reserves. Production was halted in October 2013, less than a month after it started, when a pipeline associated with the field cracked open. Kazakh Deputy Energy Minister Uzakbai Karabalin told reporters the government in Astana is determined to increase production despite a series of setbacks. "Oil output is expected to reach 630 million barrels in 2017 and 760 million barrels in 2020," he said. "This increase will be due to the expansion project at [onshore oil field] Tengiz and resumption of offshore oil production at Kashagan." Kazakh production […]

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Forecasting China’s Oil Buying Grows Harder

ENLARGE A tanker in eastern China. The country has snapped up oil in response to low prices. Photo: European Pressphoto Agency DALIAN, China—Just northeast of this coastal city, the highway ends where guards block entry to one of China’s strategic oil reserves. Behind a gate, mountains hide the site. As obscure as the view of Dalian’s oil-reserve tanks is the outlook for China’s oil demand. When benchmark oil prices tumbled last year—falling by more than half within six months—China rushed to buy. The drop in price suddenly made it more affordable to fill stockpiles that the government and oil companies have set up to increase energy security. The effort gave a boost to global demand, contributing to 9.5% growth in China’s crude-oil imports last year: tens of millions of additional barrels from the Middle East, Russia and elsewhere. That buying has made the task of assessing true Chinese demand […]

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China fuel oil: Shandong teapot refiners likely to further cut fuel oil demand

Singapore (Platts)–26Feb2015/301 am EST/801 GMT Demand for imported fuel oil as feedstock at teapot refineries in East China’s Shandong province remains weak after the week-long Lunar New Year holiday, with the market now watching out for the release of additional crude import quotas, sources said Thursday, February 26. "With the government [likely to] allocate more crude quotas to teapot refineries, demand for imported fuel oil as feedstock will probably continue to be squeezed," said a Shandong-based trader. Early last week, the National Development and Reform Commission released a circular outlining rules stating that qualifying refiners that want to apply for crude import quotas must permanently shutter small primary processing units. In the case of teapot refineries in Shandong, around 15 refiners have crude distillation units under 2 million mt/year (40,000 b/d) in size, while one refiner has a CDU larger than 2 million mt/year in capacity. These refiners would […]

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