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Egypt, Ethiopia and Sudan Sign Nile Dam Declaration

ENLARGE Egyptian President Abdel Fattah Al Sisi, right, next to his Sudanese counterpart Omar Bashir during a welcoming ceremony in the Sudanese capital Khartoum on Monday. Photo: Agence France-Presse/Getty Images Egypt, Sudan and Ethiopia took a step Monday to defuse tensions around Ethiopia’s construction of a massive dam on the Blue Nile, which has threatened to upset the geopolitical balance in the region over how to share water from the River Nile. Egyptian President Abdel Fattah Al Sisi, Sudanese President Omar al-Bashir and Ethiopian Prime Minister Halemariam Desalegn signed a declaration in Sudan’s capital Khartoum, pledging to better share the Nile’s waters, an Egyptian presidency official familiar with the matter said. Ethiopia has said the project is necessary to produce much-needed electricity, but the building of the dam has been controversial, with some scientists predicting it could disrupt the flow of the river into Egypt, where it provides much […]

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Chinese Economy Dangles on a Cliff

Chinese Economy Dangles on a Cliff thumbnail China’s money supply had a net increase of 11 percent from 2013 to 2014, an increase that is significantly higher than the country’s economic growth. In 2014 it reached 122.84 trillion yuan (US$18.05 trillion), compared with 110.7 trillion (US$17.71 trillion) by the end of 2013. Of China’s 12.14 trillion added currency (US$1.94 trillion) in 2014, 9.78 trillion yuan (US$1.56 trillion), over 80 percent, was used for creating new loans. Not only was it 890 billion (US$142 billion) higher than that in 2013, but also broke the 2009 record of 9.59 trillion (US$1.53 trillion) by 190 billion (US$30 billion) more. So much new money was printed. Where did it all go? The majority of the loans did not flow into the economy, but went into non-production areas, namely the financial market. Massive Money Printing The Research Center for China Market Value Management Ltd. […]

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Sinopec facing era of slower growth

China Petroleum & Chemical Corp. said it expects low price of crude oil to become commonplace. File Photo by UPI/Shutterstock/ekina. Fu Chengyu , chairman of the company known also as Sinpece, said his company last year was focused on quality growth , adjusting each segment of its business accordingly. "In 2015, China will enter a new normal phase of slower growth while international crude oil prices are likely to stay low," he said in a statement Sunday. "The company still faces a challenging operating environment. Sinopec will seize the opportunities and tackle the challenges." The phrase "new normal" was coined last year by Chinese President Xi Jinping , who said qualitative growth was favored over quantitative growth. China, in the 35-year period ending in 2013, posted double-digit growth. It has slowed down to around 7.5 percent in recent years. For Sinopec, last year’s capital spending was down 4.2 percent. […]

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Report says China manufacturing at lowest in nearly a year

HONG KONG (AP) — A report says that China’s manufacturing activity has fallen to the lowest level in nearly a year as new orders shrank. The preliminary HSBC purchasing managers’ index released Tuesday dropped to 49.2 in March. That’s down from February’s 50.7. The readings are based on a 100-point scale on which numbers above 50 indicate expansion. The report said a "renewed fall in total new business contributed to weaker expansion of output" while companies trimmed staff. The weakness in China’s massive manufacturing sector adds to official worries about the country’s deepening economic slowdown. China’s economy expanded 7.4 percent last year, its slowest pace in nearly a quarter century, and economists predict growth will slow further in the next two years.

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Whiting Petroleum Gives Signal Deal May Not Be Imminent

Whiting Petroleum Corp. announced plans Monday to offer 35 million shares as well as $1.75 billion of convertible senior notes, raising concerns about the oil-and-gas producer’s ability to find a buyer for the whole company. Earlier this month, The Wall Street Journal had reported that Whiting was looking to sell itself amid plummeting crude prices. However, the stock sale announced Monday signaled any larger takeover was unlikely soon, an analyst said. “I think it pretty much puts that idea to bed,” said Jason Wangler, an analyst at Wunderlich Securities Inc. “It doesn’t mean there wasn’t interest, but it obviously means they didn’t get the price they wanted.” Shares of Whiting fell 12% to $33.75 in after-hours trading following news of the offerings. The stock—beaten down in late 2014 amid the drop in oil prices—had risen 47% through the close Monday from its low in December. Denver-based Whiting began suffering […]

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Hedge funds get short of U.S. oil as storage fills: Kemp

LONDON (Reuters) – Hedge funds have turned super-bearish about U.S. oil prices as concerns about running out of storage trump the drop in the number of rigs drilling new wells. Money managers had amassed a record number of short positions in futures and options contracts linked to WTI (West Texas Intermediate) by the end of March 17, equivalent to 209 million barrels of oil, according to the U.S. Commodity Futures Trading Commission’s (CFTC) latest commitments of traders report published on Friday. Money managers still have long positions equivalent to 381 million barrels, so overall the sector is still running a net long position. Hedge fund managers have a natural bullish bias. Not once have hedge funds as a whole been net short of WTI futures and options in the last nine years ( link.reuters.com/daf44w ). But the ratio of long to short positions last week, at 1.8:1, was the […]

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U.S. refiners turn to tanker trucks to avoid ‘dumbbell’ crudes

HOUSTON (Reuters) – In a pressing quest to secure the best possible crude, U.S. refiners are increasingly going straight to the source.     Firms such as Marathon Petroleum Corp and Delek U.S. Holdings are buying up tanker trucks and extending local pipeline networks in order to get more oil directly from the wellhead, seeking to cut back on blended crude cocktails they say can leave a foul aftertaste. While the business of hauling crude from individual oil wells to bulk storage depots or pipeline hubs has become a lucrative niche in recent years thanks to the shale oil revolution, refiners are getting into the "first mile" game for a different reason: taking control of their supply chains to secure a more predictable, consistent stream of crude.     Phillips 66, the nation’s fourth-largest refiner, has added trucks and offloading equipment at several of its refineries to help reduce its reliance […]

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Here’s How $20 Oil Could Become a Reality If Storage Runs Out

There’s the makings of a crisis swirling in America’s oil-storage tanks, and the next few months will determine whether it’s a minor annoyance, or a major blow, to U.S. oil.  The basic problem is that too much oil is being pumped, and not enough is being used up. America is running out of places to store all of the excess crude. That’s a problem, and it could send prices plummeting — some say to  $20 a barrel  or even lower . (For context: Last summer it was more than $100, and today it’s less than $50.) That’s probably not going to happen, but it’s not as crazy as it might first sound. Stockpiles are at record-high volumes after 10 straight weeks of increases. The U.S. is currently accumulating an extra one to two million barrels a day more than its using. The oil imbalance is bad, and it’s still getting worse. If oil inventories begin to top […]

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Barclays: New fracturing regs will have limited effect on US oil, gas output

HOUSTON, Mar. 23 A recent US rule about hydraulic fracturing on federal and tribal lands will have limited effect on existing US oil and natural gas production, said a Barclays Research analyst in New York. The US Department of the Interior issued a long-anticipated final rule to govern fracturing of onshore oil and gas wells ( OGJ Online, Mar. 20, 2015 ). Officials with the US Bureau of Land Management said the regulations, effective in 90 days, will improve safety and help protect groundwater by updating requirements for wellbore integrity, wastewater disposal, and public disclosure of chemicals. Onshore oil production from federal and tribal lands accounted for less than 10% of US oil production according to statistics from 2013, the latest available data, said Michael Cohen, Barclay’s research analyst. Most oil and gas production from federal jurisdiction involves the offshore Gulf of Mexico, he said. “The rulemaking is significant […]

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Schlumberger Sees Prudence As New Normal For US Shale Oil

Schlumberger says it expects the oil and gas industry’s spending internationally on exploration and production to drop by 10-15% in 2015. March 23 (Reuters) – Prudence will be the new normal for the U.S. shale oil industry, which has quickly abandoned its heavy-spending ways in the face of sliding crude prices, Schlumberger Ltd, the world’s No.1 oilfield services provider, said on Monday. Spending cuts already announced by producers – to the tune of 25 to 60 percent – have dropped the rig count by 45 percent since late 2014, and output will soon decline or flatten out so prices can recover, Schlumberger’s Chief Executive Paal Kibsgaard said. U.S. oil prices have fallen by 50 percent since June to around $46 per barrel as Saudi Arabia and OPEC try to push higher cost producers out of the market. At the time of $100 oil, some U.S. highly-leveraged U.S. players were […]

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