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Oil climbs to $61 on Mideast supply concerns

LONDON (Reuters) – Brent crude oil rose to around $61 a barrel on Friday as fighting in Libya and Iraq stoked output worries, while traders kept a close eye on Iran nuclear talks that could eventually bring more supply to world markets. Fighting has escalated in northeast Iraq where Islamic State militants have set fire to oilfields to deter Shi’ite militiamen and Iraqi soldiers from advancing. In Libya, worsening security conditions have led to the closure of 11 oilfields. Brent LCOc1 was up 50 cents a barrel at $60.98 by 0910 GMT (4:10 a.m. EST). U.S. light crude CLc1 was up 30 cents at $51.06 a barrel. Worries about oil supplies from the Middle East helped widen the premium for Brent over U.S. crude CL-LCO1=R by nearly $1 to around $10 on Thursday. "The Libyan and Iraqi oilfield skirmishes are worrying," said Tamas Varga, oil analyst at London brokerage […]

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USW, Shell to resume talks amid ongoing labor strike at US refineries

The United Steelworkers union (USW) and Royal Dutch Shell PLC , which serves as lead company for National Oil Bargaining negotiations, have agreed to return to the bargaining table in an attempt to resolve USW’s more than 5-week-long unfair labor practice strike in effect at US refineries and associated installations ( OGJ Online, Feb. 2, 2015 ). After an extended period of halted discussions between the parties, Shell and USW decided at a Mar. 4 meeting to resume the negotiation process during the week beginning Mar. 9, Shell said. The announcement comes just days after Shell revealed its plan to return the company’s strike-impacted sites to normal, full-rotation operations with the use of Shell-trained employees and without the use of union workers ( OGJ Online, Mar. 3, 2015 ). While Shell expressed hopes of reaching a mutually satisfactory agreement with USW upon renewed negotiations, the company also said it […]

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GOP Presidential Hopefuls Risk Iowans’ Ire on Ethanol

ENLARGE Corn is delivered to the Green Plains ethanol plant in Shenandoah, Iowa, earlier this year. Despite lower crude prices, ethanol plants across the nation continue to operate at a brisk pace. Photo: Associated Press For decades, presidential candidates have bowed to Iowa’s corn-based ethanol industry while campaigning in a state where corn is king. But several of the likely Republican candidates slated to address the state’s agricultural industry on Saturday backed the sunset of ethanol subsidies in 2011, and many oppose the industry’s new sacred cow: the renewable-fuel standard, which requires blending ethanol and other biofuels into the gasoline supply. How the likely White House contenders navigate the issue will signal how much Republican politics are now driven by the party’s conservative base, which balks at government interference in the marketplace. Two GOP contenders who want to phase out the renewable-fuel standard, Florida Sen. Marco Rubio and Louisiana […]

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Oil Glut Sparks Latest Dilemma: Where to Put It All

ENLARGE Newly constructed oil-storage tanks in Cushing, Okla. in 2012. Despite a boom in tank construction since 2009, U.S. facilities are running out of room for more crude. Photo: Associated Press In a world awash in crude, oil producers and traders are facing a billion-barrel conundrum: where to put it all. U.S. crude-oil supplies are at their highest level in more 80 years, according to data from the Energy Information Administration, equal to nearly 70% of the nation’s storage capacity. A key U.S. storage hub in Cushing, Okla., is expected to hit maximum capacity this spring. While estimates are rough, Citigroup Inc. believes European commercial crude storage could be more than 90% full, and inventories in South Korea, South Africa and Japan could be at more than 80% of capacity. The danger of running out of places to stash crude: Some analysts predict prices, already down 50% since June, […]

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U.S. factory orders fall for sixth straight month

WASHINGTON (Reuters) – New orders for U.S. factory goods unexpectedly fell in January, posting their sixth straight monthly decline, a sign of weakness in the manufacturing sector. The Commerce Department said on Thursday new orders for manufactured goods slipped 0.2 percent after a revised 3.5 percent decline in December. Economists polled by Reuters had expected factory orders to gain 0.2 percent in January after a previously reported 3.4 percent tumble in December. The department also said orders for non-defense capital goods excluding aircraft – seen as a measure of business confidence and spending plans – rose 0.5 percent instead of the 0.6 percent advance reported last month. Manufacturing has been hurt by softening demand in Europe and Asia as well as a strong dollar and lower crude oil prices, which have caused some energy companies to either delay or cut back on capital expenditure projects. A labor dispute at […]

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Ukraine Says EU Should Help Pay to Store Gas if It Wants to Prepare for Worst Cases

Ukrainian Energy Minister Volodymyr Demchyshyn BRUSSELS—The European Union should share the cost of filling Ukraine’s natural-gas storage if it wants to prepare for worst-case scenarios next winter, the country’s energy minister said in an interview, highlighting a potential clash in coming negotiations between the EU, Kiev and Moscow. An EU-mediated deal that helped maintain gas supplies to Ukraine and the rest of Europe during the winter expires at the end of March. The comments by Volodymyr Demchyshyn, a former investment banker who took office in December, underline how difficult it will be to reach a follow-up agreement that ensures deliveries over the summer and beyond. About half of the EU’s gas imports from Russia pass through Ukraine. Mr. Demchyshyn also warned that the government in Kiev might decide to cut off shipments to regions controlled by pro-Russian separatists because of a failure by local energy distributors to pay for […]

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The Price of Oil Is Down, So Why Is Production Still Going Up?

Too much oil, too fast. That turns out to be the downside of the U.S. oil boom—at least if you’re an investor. Prices crashed, and America is pumping so much crude its running out of places to store it. One promising sign you may have heard about: The plunge in U.S. oil rigs. Every week since 1944, oilfield-services company Baker Hughes has released a survey of rigs out drilling for oil. But it wasn’t until oil prices dropped by more than half that "rig counts" became part of everyday business vocabulary. Oil watchers are desperate for any sign of an end to the glut. Drillers have been shutting down rigs at a record pace. But oil production isn’t slowing yet. In fact, the U.S. is pumping more crude now than at any time in 40 years. Why? We explore the conundrum in our animated explainer: Why Cheap Oil Doesn’t Stop the Drilling . Declining Rigs Versus […]

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Oil Fluctuates on China’s Lower Growth Target, Libyan Supply Issues

By Eric Yep Crude-oil futures swung between gains and losses in Asian trade Thursday as investors assessed a lower growth target from China, a slower increase in U.S. oil stockpiles and ongoing production issues in Libya. On the New York Mercantile Exchange, light, sweet crude futures for delivery in April traded at $51.82 a barrel at 0419 GMT, up $0.29 in the Globex electronic session. Brent crude for April delivery on London’s ICE Futures exchange rose $0.14 to $60.69 a barrel. China on Thursday projected economic growth of about 7% for 2015, lower than the 7.4% it achieved in 2014. Beijing also announced several energy-related goals, including reducing energy intensity–the amount of energy needed to increase gross domestic product–by more than 3.1% for 2015, strictly controlling energy use and boosting clean-energy sources like hydropower. A softer Chinese economy has been mostly priced in by the market considering that crude […]

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U.S. Oil Prices Rise After Supply Data

Oil pump jacks next to a strawberry field in Oxnard, Calif. ENLARGE Photo: Reuters U.S. oil prices rose on Wednesday after weekly data showed that inventories at a key storage hub increased less than expected. Light, sweet oil for April delivery settled up $1.01, or 2%, at $51.53 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, settled lower as concerns ebbed that violence in Libya would immediately halt production. Front-month futures fell 47 cents, or 0.8%, to $60.55 a barrel on ICE Futures Europe. U.S. crude stockpiles rose by 10.3 million barrels to 444.4 million barrels in the week ended Feb. 27, the Energy Information Administration said Wednesday. Analysts surveyed by The Wall Street Journal had predicted a 4.6 million-barrel increase. The gain was the biggest for a single week since March 2001. However, supplies in Cushing, Okla., the delivery point for the Nymex contract, […]

Posted On : Published By : Tom Whipple