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Trains Carrying Crude in Canada to Face Tougher Safety Standards

(Bloomberg) — Canada is strengthening proposed new safety standards for rail cars carrying crude oil, requiring thicker steel and other improvements after a 2013 derailment killed 47 people. The latest Transport Canada proposals, published online Wednesday, go beyond earlier announcements by requiring rail cars carrying crude to have thicker steel, full “head shields,” mandatory thermal “jacket” protection among other upgrades. Canada continues to work with the U.S. on rail standards, the document said, adding the U.S. will make its own decisions. In its online update, Transport Canada said the Transportation Safety Board had pushed for improvements from those initially published in January 2014. Transport Minister Lisa Raitt announced the new standards, which are still subject to federal cabinet approval, in parliament Wednesday. The standards create “a new class of tank car specifically designed to transport flammable liquids by rail,” said Zach Segal, a spokesman for Raitt. The updated proposals […]

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How Big Oil Is Profiting From the Slump

The Royal Dutch Shell Plc Olympus tension leg platform (TLP) sets sail from Kiewit Offshore Services in Ingleside, Texas, U.S. Photographer: Eddie Seal/Bloomberg (Bloomberg) — Europe’s largest oil companies are gaining support from an unlikely source as they confront the industry’s worst slump since the financial crisis: lower oil prices. Although better known for their oil fields, refineries, and petrol stations, BP Plc, Royal Dutch Shell Plc and Total SA are also the world’s biggest oil traders, handling enough crude and refined products every day to meet the consumption of Japan, India, Germany, France, Italy, Spain and the Netherlands. The trio’s sway in commodities trading, largely unknown outside the industry, is set to pay off in 2015 as the bear market allows traders to generate higher returns by storing cheap oil today to sell at higher prices later and using lower prices to make more bets with the same […]

Posted On : Published By : Tom Whipple
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The U.S. Has Too Much Oil and Nowhere to Put It

Overflowing storage tanks could lead to another drop in prices Photo Illustration: Braulio Amado; Source: Alamy (2) Seven months ago the giant tanks in Cushing, Okla., the largest crude oil storage hub in North America, were three-quarters empty. After spending the last few years brimming with light, sweet crude unlocked by the shale drilling revolution, the tanks held just less than 18 million barrels by late July, down from a high of 52 million in early 2013. New pipelines to refineries along the Gulf Coast had drained Cushing of more than 30 million barrels in less than a year. As quickly as it emptied out, Cushing has filled back up again. Since October, the amount of oil stored there has almost tripled, to more than 51 million barrels. As oil prices have crashed, from more than $100 a barrel last summer to below $50 now, big trading companies are storing their crude […]

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Fuel-Thirsty California Looks to Eastern Canada, Asia for Supply

A bicyclist rides past an oil tanker as it unloads a shipment of oil through an underwater pipeline connected to the Chevron El Segundo refinery in El Segundo, California. The state’s gasoline demand has waned in the last decade and U.S. refiners have raised their own production because of cheaper crude and natural gas costs. Photographer: Jonathan Alcorn/Bloomberg (Bloomberg) — Fuel producers in California, facing plant outages and upsets that are squeezing supplies, are looking as far off as Asia and eastern Canada for reinforcements. A tanker carrying refined products such as gasoline, diesel and jet fuel was bound for Los Angeles on Wednesday after loading at the Point Tupper terminal in Nova Scotia, shipping data compiled by Bloomberg show. At least seven other fuel tankers were headed to the U.S. West Coast after leaving Asia, the data show. Tankers are bound for California after a spate of refinery […]

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Russia to Keep Oil Output Steady to 2035 Despite Price Drop

(Bloomberg) — Russia plans to maintain oil output at current levels for the next two decades, Energy Minister Alexander Novak said, shrugging off sanctions and the slump in crude prices. Production will remain at about 525 million metric tons a year, or 10.5 million barrels a day, until 2035, Novak said Wednesday at a conference in Moscow. Russia, which ranks with Saudi Arabia and the U.S. among the world’s biggest producers, pumped 10.71 million barrels a day in January, a post-Soviet record. Crude oil dropped 48 percent last year because of global oversupply, prompting speculation that producers would curb output as fields became unprofitable. U.S. shale oil output will expand at the slowest pace in more than four years in April, according to a U.S. government report Monday. “We aren’t making any assumptions about reducing output currently,” Novak said. “Our task and plan, as you know, is to maintain […]

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Brent rebounds towards $57 after U.S. crude stocks fall

SINGAPORE (Reuters) – Brent crude rose towards $57 a barrel on Wednesday, paring some of the previous session’s sharp losses, after data showed U.S. crude stocks fell for the first time in two months. The benchmark closed nearly 4 percent down in the previous session on a rallying U.S. dollar and before an industry group said U.S. crude inventories fell by 404,000 barrels last week. Analysts had expected a 4.4 million barrel build in stocks. Brent for April delivery LCOc1 rose 21 cents to $56.60 a barrel by 0340 ET after dropping $2.14, or 3.66 percent, in the previous session. West Texas Intermediate for April delivery CLc1 climbed 51 cents to $48.80 a barrel after falling $1.71, or 3.42 percent, on Tuesday. "The sell-off was overdone," said Jonathan Barratt, chief investment officer at Sydney’s Ayer’s Alliance. "I think it was more of a knee-jerk reaction because of the substantial […]

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Natural Gas Rebounds as Demand Outlook Improves

By Timothy Puko Natural gas prices bounced back Tuesday after a day of big losses and an improving outlook for demand. Natural gas for April delivery settled up 5.4 cents, or 2%, at $2.732 a million British thermal units on the New York Mercantile Exchange. The gains come a day after natural gas lost 5.7%, its third-largest drop of the year. Open interest in the market dropped, a sign Monday’s fall was from buyers getting out of their positions, and not from short-sellers–people betting prices will fall–flooding in, said Frank Clements, co-owner of Meridian Energy Brokers Inc. outside New York. If people aren’t getting into new positions, it limits momentum, he added. "You’re not going to get any kind of sustainable move when people are liquidating," Mr. Clements said. "Traders are just sitting on the sidelines right now." The balance of supply and demand does look tighter, and a […]

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Oil Prices Drop on Supply Expectations

Oil prices slid Tuesday on expectations that U.S. crude stockpiles hit another record high last week. Light, sweet oil for April delivery fell $1.71, or 3.4%, to $48.29 a barrel on the New York Mercantile Exchange, the lowest settlement since Feb. 26. Brent, the global benchmark, settled down $2.14, or 3.7%, at $56.39 a barrel on ICE Futures Europe, the lowest level since Feb. 11. The U.S. Energy Information Administration will release its inventory data for the week ended March 6 on Wednesday. Analysts surveyed by The Wall Street Journal expect that crude supplies rose by 4.8 million barrels in the week. Crude stocks are already at their highest level in about 80 years. The analysts also expect the EIA to report that gasoline supplies fell by 1.7 million barrels, while stocks of distillates, including heating oil and diesel, fell by 2.3 million barrels. The American Petroleum Institute, an […]

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Oil price rally waning, though WTI holding strong

Though data show U.S. shale oil production may slow, crude oil prices deflate from recent highs. Photo by David Gaylor/Shutterstock The price for Brent, the global benchmark, slid about 1.3 percent from Monday’s close to trade near $57.70 per barrel for the April contract early in Tuesday trading. Brent hit a low mark of around $45.13 per barrel mid January and climbed 37 percent by late February. The rally, however, ran out of steam in March, with Brent crude oil prices down about 5.3 percent since the start of the month. Crude oil prices entered a bear market in June as markets swung toward the supply side in response to gains in U.S. oil production. Prices had dipped to the point that most major oil companies were cutting back on revenue streams for exploration and production, with rig activity in the Bakken oil reserve area of North Dakota falling […]

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Iran, IAEA Exchange Data in Nuclear Talks, Plan Next Meeting

ENLARGE International Atomic Energy Agency Deputy Director General Tero Varjoranta photographed at Vienna’s Schwechat airport on his return from Iran last month. Photo: Associated Press Iran and the United Nations atomic agency exchanged additional information about Tehran’s past nuclear work on Monday and will meet again next month, the International Atomic Energy Agency said Tuesday, but there was little sign of a sudden breakthrough. Talks between Iran and the IAEA are aimed at clearing up questions on whether Iran’s past work was linked to nuclear weapons research. U.S. and European officials have said progress is needed in the IAEA discussions to help seal a separate nuclear agreement between Iran and six major powers on Tehran’s future nuclear activities. An IAEA team led by Tero Varjoranta, the agency’s deputy chief, held a day of technical meetings with Iranian officials on Monday, the IAEA said in a brief statement. The agency […]

Posted On : Published By : Tom Whipple