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Iran nuclear deal may open oil taps in months, not weeks

WASHINGTON (Reuters) – A possible deal over Iran’s nuclear program that would phase out economic sanctions against Tehran is unlikely to flood world markets with more oil any time soon, despite Iran’s declared intention to claw back market share lost because of the curbs. Negotiators are still working out details of the deal they aim to seal by the end of June, but it would almost certainly lift sanctions only in stages, deferring even a partial return of Iranian crude exports until at least 2016, according to market experts, former U.S. officials, and Western diplomats. Progress in talks in Switzerland this month has contributed to a more than 10 percent slide in oil prices over the past week as some traders and analysts brace for up to 1 million barrels per day (bpd) of Iranian crude hitting markets, potentially doubling the estimated global supply surplus. Many focus on how […]

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Iran reports economic growth momentum

Central Bank of Iran reports modest economic growth despite pressure from Western sanctions. UPI/Maryam Rahmanian Iran’s economy emerged from recession in late 2014, though sanctions still curb the country’s ability to generate revenue from oil and gas sales. The Central Bank of Iran, however, said a nine-month growth rate of 3.6 percent represents an increase in $54 billion. Iranian budget negotiators are working on a draft for a new year that begins Saturday that envisions less dependency on oil revenue. When he wrapped up his mission to Iran last month, Martin Cerisola, assistant regional director for the International Monetary Fund, warned "the sharp drop in global oil prices and an uncertain external environment" presents significant challenges to Iran’s economic future . Sanctions on Iranian oil exports and other parts of the economy resulted in an economic contraction of 5.8 percent in 2012-13. For fiscal year 2013-14, the World Bank […]

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Libya’s recognized government says oil sales must go through eastern firm

BENGHAZI/CAIRO, Libya (Reuters) – Libya’s internationally recognized government said on Tuesday that any sales of the country’s oil should be arranged through a state firm based in Benghazi under its leadership to prevent fraud. If implemented, the decision would escalate a battle for control that is raging, four years after the ousting of Muammar Gaddafi, between the official government based in the east and a rival administration in Tripoli. Oil markets have been wondering who is owning Africa’s largest oil reserves. But so far customers have continued paying for exports worth hundreds of millions of dollars each month through state National Oil Corp (NOC) based in Tripoli, which is under effective control of the rival government. "The government confirms that any contracting or sale outside the legal framework represented by National Oil Corp headed by Mabrouk Bou Seif and based in Benghazi is considered a violation," the official government […]

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U.S.: Security risks in oil-rich Saudi region

Riyadh-Makkah (Mecca ) highway in Saudi Arabia U.S. warns of threats to Westerners in oil-rich parts of Saudi Arabia. (UPI/Shutterstock/Fedor Selivanov) U.S. consular services in Saudi Arabia remain closed five days after a threat surfaced against Western oil workers in the country, the U.S. embassy said. The U.S. Embassy in Riyadh said consular services are suspended through Tuesday because of unspecified heightened security concerns at diplomatic outposts in Saudi Arabia. "A new security message will be sent out as soon as consular services return to normal," an embassy statement read. An embassy statement last week was specific to Western oil workers . The embassy said Friday it had information stating that terrorist groups may have plans to target oil workers, "possibly to include those U.S. citizens working for oil companies in the Eastern Province [of Saudi Arabia], for an attack and/or kidnapping." The embassy provided no further information on […]

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Algerian Attempt to Rally Oil Prices Fails to Ignite

An Algerian invitation to fellow oil producers to work together on oil prices attracted only Angola this week, as the latest attempt to counter slumping oil prices failed to ignite. A Nigerian proposal last month to convey an emergency meeting of the Organization of the Petroleum Exporting Countries immediately fizzled after the group’s kingpin Saudi Arabia opposed the move. Fears of a mounting oil glut amid resilient U.S. oil production and brimming inventories have driven oil prices down again in recent days—after already halving since last June. Writing on behalf of Algerian President Abdulaziz Bouteflika, oil minister Youcef Yousfi sent invitations to a dozen countries, including Saudi Arabia, Nigeria, Angola and non-OPEC producer Russia, to discuss a concerted response to falling oil prices as part of “consultative meeting” in Algiers on March 16, according to people familiar with the letter. But only Angola’s oil minister José Maria Botelho de […]

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Egypt Signs Gas Import Deal With Russia’a Gazprom – Petroleum Ministry

Cairo — Egypt signed a deal to import 35 shipments of liquefied natural gas (LNG) over five years with Russian energy company Gazprom on Tuesday, the Petroleum Ministry said in a statement. The deal will see Egypt receive seven shipments of LNG annually for five years. The state’s Egyptian Natural Gas Holding Company signed the deal with the giant Russian firm. Gazprom has an 18 percent share of global natural gas reserves. The two sides will agree on when Egypt will receive shipments in the second half of this year. Signing this deal brings the amount of LNG shipments Egypt has agreed to import to 90 shipments provided by five foreign companies, 49 of which are going to be delivered in 2015 and 2016. These agreements are part of the state’s global tender to import natural gas in order to meet fuel demands of electric power plants, amid a […]

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Political uncertainty plagues Nigeria’s oil potential

Politics creating investment risk to Nigeria’s offshore oil potential, report from IHS finds. (UPI/Shutterstock/project1photography) The Independent National Electoral Commission said it plans to hold a nation-wide vote March 28, six weeks later than originally planned. Nigeria’s government postponed the vote in February, arguing the threat from militant group Boko Haram was too great to ensure safety at the polls. Nigeria is Africa’s largest oil producer. A report from IHS finds the future of the nation’s oil sector is at risk from the uncertain political future. Roderick Brice, the author of the report on Nigeria for the analytical group, said elections are a disruptive force in the oil-rich country. Regardless of who wins, investors will face an uncertain future. "That uncertainty has already constrained deepwater exploration and development," he said in a statement Monday. IHS forecasts crude oil production in Nigeria will drop from the 2 million barrels per day […]

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BP: U.S. Gulf Returning to Pre-Spill Condition

Deepwater Horizon Gulf of Mexico Oil Spill In the five years since the Deepwater Horizon oil spill, scientific data and studies are showing that the Gulf environment is returning to its baseline condition, according to a new report BP released today. The Gulf of Mexico Environmental Recovery and Restoration report also indicates that impacts from the spill largely occurred in the spring and summer of 2010. The report is based on scientific studies that government agencies, academic institutions, BP and others conducted as part of the spill response, the ongoing Natural Resource Damage Assessment (NRDA) process or through independent research. While individual studies are helpful, they tell only part of the story. This report, a wide-ranging compilation of reputable studies by respected researchers, provides a broader overview of the state of the Gulf environment. “The data and studies summarized in this report are encouraging and provide evidence that the […]

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Are The Good Times Over For Growth In US Shale Gas?

US natural gas production could decline in 2016 for the first time in 10 years, driven by low oil prices after a decade of gangbusters growth from shale plays. March 17 (Reuters) – U.S. natural gas production could decline in 2016 for the first time in 10 years, driven by low oil prices after a decade of gangbusters growth from shale plays. While most analysts forecast gas production will continue growing year-over-year, albeit at a slower pace, a couple of outlier analysts believe low oil and gas prices will prompt drillers to cut spending enough to reduce gas production next year. Any talk of cutbacks is an early sign that low oil prices have slowed the U.S. shale gas boom that has revolutionized global markets and is expected to transform the nation into a net exporter of gas by the end of the decade. U.S. gas production has increased […]

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ConocoPhillips Expects Output To Rise 13% In Next 3 Years

ConocoPhillips expects production to climb 13% to touch 1.7 million barrels of oil equivalent per day in 2017. March 17 (Reuters) – ConocoPhillips expects production to climb 13 percent to touch 1.7 million barrels of oil equivalent per day (mmboed) in 2017. The company, whose forecast excludes output from Libya, produced 1.5 mmboed in 2014, a 4 percent rise from 2013. ConocoPhillips said on Tuesday it expects output to grow 2-3 percent in 2015. It did not specify a growth rate for 2016. The company, which cut its 2015 capital budget by $2 billion to $11.5 billion in January, said it expects to maintain spending at the new level for the next two years. ConocoPhillips, like its rivals such as Chevron Corp and Apache Corp, has deferred drilling plans and delayed spending on some of its major projects to cope with a roughly 50 percent slump in global crude […]

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Report: Removing US Oil Ban Would Create Jobs Beyond Drilling

WASHINGTON, March 17 (Reuters) – Lifting a 40-year-old U.S. ban on crude exports would create a wide range of jobs in the oil drilling supply chain and broader economy even in states that produce little or no oil, according to a report released on Tuesday. Some 394,000 to 859,000 U.S. jobs could be created annually from 2016 to 2030 by lifting the ban, according to the IHS report, titled: "Unleashing the Supply Chain: Assessing the Economic Impact of a U.S. crude oil free trade policy." Only 10 percent of the jobs would be created in actual oil production, while 30 percent would come from the supply chain, and 60 percent would come from the broader economy, the report said. The supply chain jobs would be created in industries that support drilling, such as oil field trucks, construction, information technology and rail. Many of the jobs would be created in […]

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Canada Transport Watchdog Wants New Tank Cars In Service Earlier

OTTAWA, March 17 (Reuters) – Canada’s transportation watchdog said on Tuesday that recent fiery derailments of trains hauling crude oil mean a new generation of stronger tanker wagons should be introduced ahead of schedule. The Transportation Safety Board (TSB) is probing two accidents within the last month involving Canadian National Railway Co oil trains which came off the tracks and caught fire near the small northern Ontario town of Gogama. Both trains were hauling CPC-1232 crude tankers, meant to be safer than the older DOT-111 models that blew up in downtown Lac-Megantic, Quebec in 2013, killing 47 people. Canada last week unveiled tough standards for a new generation of tanker cars that would replace the CPC-1232s by 2025 at the latest. "While the proposed standards look promising, the TSB has concerns about the implementation timeline, given initial observations of the performance of CPC-1232 cars in recent derailments," the agency […]

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Canadian natural gas E&P outlook weak: analyst

Houston (Platts)–17Mar2015/412 pm EDT/2012 GMT The outlook for Canada’s natural gas exploration and production industry will remain weak over the next several years as boosted US production, high North American stock levels and low prices continue to weigh on the profitability of the industry, the Conference Board of Canada said Tuesday. The dramatic rise in US shale gas production in the last several years, particularly in the Appalachian Basin’s Marcellus and Utica Shale plays has led to a decreased demand for imports of gas from Canada, said Michael Shaw, a CBC economist and co-author of a board study. "I think the US natural gas industry is going to do quite well," Shaw said in an interview. "I think that it doing so well it is going to push out Canadian imports and really hurt the Canadian industry." Canadian gas production, which last year averaged about 14.7 Bcf/d, can be […]

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Falling rig counts drive projected near-term oil production decline in 3 key U.S. regions

Source: U.S. Energy Information Administration, Drilling Productivity Report Republished March 17, 2015, 10:00 a.m., text was modified to clarify content. EIA’s most recent Drilling Productivity Report (DPR) indicates a change in the crude oil production growth patterns in three key oil producing regions: the Eagle Ford, Niobrara, and Bakken . The DPR estimates, which were issued on March 9 and cover the months of March and April, include the first projected declines in crude oil production in these regions since publication of the DPR began in October 2013. However, with production gains continuing in other regions, particularly the Permian, overall crude oil production in regions tracked by the DPR rose slightly in March to 5.6 million barrels per day. Total production in the DPR regions in April is expected to be virtually unchanged from its March level. In any given month, there are new wells and legacy, or continuing, […]

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Cnooc’s North American Unit Slashes 13% of Workforce

CALGARY—The North American headquarters of China National Offshore Oil Corp. said Tuesday it would cut about 13% of its workforce due to the slump in global oil prices , raising questions about terms of the Chinese state-owned company’s accord with the Canadian government. Cnooc said wholly-owned Canadian unit Nexen Energy ULC would reduce its 3,200-strong workforce by 400 jobs, including 340 in North America and 60 working for its British unit, to deal with falling revenue from a more than 50% drop in crude prices compared with mid-2014. It also said it would reorganize key business units and slow development on a new oil-sands project in northern Alberta. “In response to the recent industry downturn that has affected all companies in the energy sector, a decision was made to conduct a thorough review of our organization to ensure our long-term viability and sustainability,” Nexen Chief Executive Fang Zhi said. […]

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Whiting Petroleum: Is It Up for Sale?

Rumors Swirl About The Fate of Bakken’s Largest Producer Whiting Petroleum Reportedly Up For Sale Rumors have been swirling for weeks that Denver-based Whiting Petroleum might be up for sale and some companies may be biting. Bloomberg reported on Friday that several companies are expressing interest in Whiting including Exxon Mobil Corp., Continental Resources Inc., Hess Corp. and Statoil ASA. No one is talking openly about a possible deal including Whiting, who has not given any official statement about their intentions. All information has come from anonymous sources and people who are speculating about what the company may do. Bloomberg quotes Phillip Jungwirth, an analyst with Bank of Montreal, who says that “Whiting is probably exploring a sale along with other strategic alternatives, including selling assets, raising debt and selling shares in order to address investor liquidity concerns.” Some believe that a full sale is unlikely due to the Whiting’s […]

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California’s Cleaner Fuel Comes at Cost to Water: Report

(Bloomberg) — The water it takes to supply energy to California, the biggest U.S. fuel market, has risen almost four-fold over two decades. And the culprit isn’t oil. It’s biofuels, according to a report. California’s “water footprint” for energy — the water used to produce transportation fuels, natural gas and electricity consumed in the state — rose to 7.7 cubic kilometers in 2012 from 2.1 in 1990, the report prepared by university and environmental researchers showed. Almost all of the increase came from water used to grow biofuel crops in the U.S. Midwest and overseas to help meet the state’s goals for using low-carbon fuels, according to the paper published by the journal Environmental Science & Technology. The increase in water demand for biofuels highlights an unintended consequence of low-carbon fuel policies being adopted and considered across the U.S. to curb global warming and reduce the nation’s dependence on […]

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Transport sector set to give big lift to oil demand

LONDON (Reuters) – Demand for oil is intimately connected to the demand for transportation in the United States and the other advanced industrial economies. Cars, trucks, airlines, railways and shipping accounted for 71 percent of total U.S. oil consumption in 2013, according to the U.S. Bureau of Transportation Statistics. Petroleum-derived fuels, including gasoline, diesel, jet fuel and fuel oil, met 97 percent of the transportation sector’s energy needs. Before the oil shocks of the 1970s as much as half of U.S. oil demand came from power producers and for heating homes, offices and factories. But following the sharp rise in prices, oil’s role in other parts of the economy was largely replaced by cheaper coal, gas, nuclear and eventually renewables, leaving oil as a transport fuel. The same pattern was repeated across the other advanced industrial economies. Oil demand has become inseparable from the demand for transportation services. But […]

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Trustees slam BP statement on gulf environment

Federal government challenges BP assessment about the state of the environment along the southern U.S. coast in the wake of the 2010 Deepwater Horizon incident. File photo by A.J. Sisco/UPI Statements made by BP about the state of the U.S. Gulf Coast environment after the Deepwater Horizon incident are off the mark, state and federal trustees said. "The state and federal trustees, including our scientific colleagues at universities and institutions around the Gulf [of Mexico], are engaged in a rigorous, scientific process of injury assessment and are still analyzing the data, conducting studies, and evaluating what happened," a statement emailed by the National Oceanic and Atmospheric Administration on behalf of the Deepwater Horizon Trustee Council late Monday read. A cascading series of events tied to the Deepwater Horizon rig, which BP leased from Transocean, led to a spill of more than 3 million barrels of oil, about 10 times […]

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Russian Energy Minister Novak to Meet Exxon CEO on Wednesday

MOSCOW, March 17 (Reuters) – Russian Energy Minister Alexander Novak plans to meet Exxon’s chief executive officer, Rex Tillerson, on Wednesday, a ministry official told Reuters. The official declined to give any more details for the meeting, which comes as Western sanctions, imposed on Russia over its actions in Ukraine, have prevented the U.S. company from participating in several projects in Russia. Tillerson last visited Moscow in June 2014 when he affirmed his commitment to doing business with Russia. Last year, Exxon was forced by the sanctions to suspend its joint operations with Russia’s top oil producer Rosneft in the offshore Arctic, where they successfully performed exploration drilling. A Rosneft spokeswoman declined to comment on any possible meeting of Tillerson and Rosneft’s head, Igor Sechin. The sanctions prevent Western companies from giving Russia technology for Arctic offshore, deepwater and shale oil development. Rosneft will not resume drilling in the […]

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Ruble’s World-Leading Rally Set to Fizzle as Oil Rebound Falters

(Bloomberg) — The rally that’s made the ruble the best-performing major currency in the past month is coming to an end as oil slides to a six-week low. The ruble is about 10 percent overvalued after gaining 2.5 percent since Feb. 17, even as crude dropped 16 percent, according to TKB BNP Paribas Investment Partners. There’s a 61 percent chance of the Russian currency weakening by such an amount by June 30, options data compiled by Bloomberg show. With a fragile cease-fire holding in Ukraine, investor attention is back on the drop in oil, after crude’s gains underpinned a recovery in Russian assets this year. The ruble’s advance after a 46 percent tumble in 2014 has allowed policy makers to reduce interest rates twice and is stoking forecasts for more easing as it drives flows into the country’s bonds. “The ruble is overvalued considering the oil price,” Konstantin Nemnov, […]

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Winners And Losers At The End Of The Era of The $100 Barrel

What if the world never again sees sustained prices for oil over $100 per barrel? What if—absent exogenous black-swan events like major wars—oil never sells for much more than $50 per barrel for decades into the future? Who wins? Who loses? The short answers: The winners are consumers everywhere, and American business that produce oil. The losers are nations that are oil monocultures, and businesses or policies everywhere anchored in expensive oil. Is such a scenario likely? Or is the current price collapse a kind of inverse bubble? History is often meaningfully predictive. In the roughly 150-year history of oil prices there have been just three short periods where oil sold for over $50 per barrel (measured in inflation-adjusted terms). It happened first for about 20 years after 1860 at the dawn of the oil age, followed by nearly a century with oil cycling around $20. The second price […]

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The world’s population continues to explode!

The world’s population continues to explode! thumbnail Feeding the World Basic survival for us humans and just about everything else living; more and more investment funds are focusing on food and water production – why? What are the facts? Starting with water; estimates suggest that the world population will increase by 40 percent to 9 billion by 2050. As their purchasing power increases, developing countries like China and India are consuming more and more goods that require water for their production. Meat, for example, can take up to 10 times more water to produce than cereal crops. Several studies have concluded that demand for water is increasing at twice the rate as the world’s population. Water is one of the strategic resources of the 21st century, along with food and energy resources. Increased investment in water infrastructure and water treatment will be necessary in order to meet higher demand. […]

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Rising energy prices will challenge western way of life

Rising energy prices will challenge western way of life thumbnail A little-known Ministry of Defence (MoD) report published earlier this year warns that converging global trends will dramatically affect UK economic prosperity through to 2040. The report says that depletion of cheap conventional “easy oil”, along with shortages of food and water due to climate change and population growth, will sustain rocketing energy prices. Long-term price spikes are likely to lead to a long recession in Western economies, fuelling internal unrest and the rise of nationalist movements. The report departs significantly from the conservative and relatively optimistic scenarios officially adopted by the British government, as exemplified in the coalition’s new Energy Security Strategy published in November last year by the Department of Energy and Climate Change (Decc). Peak “easy oil” The report predicts that “the imminent passing of the point of peak ‘easy oil’ will mean that hydrocarbon-based energy […]

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The gold:oil ratio is speaking

As a believer in the power of diversification and inflation protection a basket of commodities can provide in a passive index framework, it is hard to grasp how much investors love oil and gold. It must be that oil is the biggest, most economically significant commodity, and gold is the shiniest, most prized metal – arguably a currency in its own right. From the largest pensions in the world to the smallest mom-and-pop retail investors, oil and gold dominate the conversation. In Taipei this week, gold and oil were louder than ever. It is an exciting time for greater China as the first commodity futures exchange-traded funds are soon to be launched. This opens the possibility for investors in this region to get access more easily to the commodities they love, but for the commodity lady that loves passive, singling out gold and oil is a difficult task. Besides […]

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Oil Prices Fall to Six-Year Low

The benchmark U.S. oil price slumped to a six-year low on Monday on fresh signs that crude supplies are swamping the market. The selloff vindicates the many Wall Street analysts and traders who were skeptical of February’s sharp rally, which was driven by a decline in drilling activity and higher fuel demand spurred by a cold snap in the U.S. The world—and the U.S. in particular—remains awash in crude, investors and analysts say. In the near term, at least, rising inventories and a robust pace of production will continue to weigh on oil prices, which have plunged by 52% in the past six months and 59% since a peak in late June. Crude-oil futures slid 96 cents, or 2.1%, to $43.88 a barrel on the New York Mercantile Exchange, the lowest level since March 2009 and edging out the previous low from late January. The latest factor sparking the […]

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Oil Prices May Have Further to Fall

Oil bulls got another piece of bad news today from an unlikely source: the Federal Reserve. U.S. crude production has continued to rise in spite of the collapse in oil prices. The Fed’s oil extraction index clocked in at a seasonally adjusted 179.8 in February. That’s up 0.4 percent from January and 14.4 percent from a year ago. As Morgan Stanley economist Ted Wieseman put it in a note to clients, the supply/demand imbalance in the oil market "isn’t being addressed yet by lower U.S. supplies."   The nosedive in oil prices has had an impact on oil and gas drilling. The Fed’s index for that activity fell 17.4 percent in February from the month before and was down 21.4 percent from a year ago. Oil analysts say the cutback in drilling eventually will lead to lower production as fewer new wells are developed. It’s just not happening yet, based […]

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History Says Oil Is Hitting Its Long-Term Floor, Or Falling Through It

As Nymex oil futures have set a six-year intraday low this morning, is a new leg down underway? We may actually have to wait until Friday to be sure. Four months ago , when looking at years-long price charts to find a potential bottom for Nymex oil futures, we noted that when crude bottomed after sizable declines the past two decades, it revisited those levels within several months. Before this past week, the lowest Friday closing low was Jan. 22’s $45.59 per barrel. It then rose a combined 16% the next three weeks before seeing a slow downtrend until last week, when the front-month Nymex April contract slumped 9.6% to $44.84. With today’s further decline, it might seem we are breaking support levels which date back to 1998’s lows. But look back at the past market bottoms. At the end of 2008, West Texas Intermediate finished Christmas week at […]

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Natural Gas Extends Losing Streak to Third Session

By Timothy Puko Natural-gas prices fell for a third-straight session as forecasts for warmer weather signaled soft demand. Natural gas for March delivery settled down 1.1 cents, or 0.4%, at $2.716 a million British thermal units on the New York Mercantile Exchange. The market has lost 3.8% since the close on March 11. Forecasts called for increasingly warm weather over the weekend, with more above-normal temperatures than previously expected to cover most of the country at the start of next week. About half of U.S. homes use natural gas for heating fuel, making winter weather a primary driver for demand. "The market has spring on its mind, but not in its step," Matt Smith, an analyst at consultant Schneider Electric SA in Louisville, Ky., said in a note. Forecasts do also show cooler-than-normal temperatures settling in later next week. That limited losses, discouraging deep short-selling, or bets against natural […]

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The melting of Antarctica was already really bad. It just got worse.

A satellite view of Antarctica is seen in this undated NASA handout photo obtained by Reuters on Feb. 6, 2012. (NASA handout via Reuters) A hundred years from now, humans may remember 2014 as the year that we first learned  that we may have irreversibly destabilized the great ice sheet of West Antarctica, and thus set in motion more than 10 feet of sea level rise. Meanwhile, 2015 could be the year of the double whammy — when we learned the same about one gigantic glacier of East Antarctica, which could set in motion roughly the same amount all over again. Northern Hemisphere residents and Americans in particular should take note — when the bottom of the world loses vast amounts of ice, those of us living closer to its top get  more sea level rise than the rest of the planet, thanks to the law of gravity . The findings […]

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OPEC comes cleaner on how much oil its members pump

LONDON (Reuters) – OPEC members’ own versions of their oil output were for years greeted with such scepticism that the group resorted to publishing what others thought they were producing. That gave rise to a mini-industry of OPEC watchers, tapping secretive sources to track every barrel. Output was hotly contested when the group squabbled over member quotas, which have since been abandoned. But on Monday, OPEC issued a set of production figures as reported to its Vienna Secretariat by member-countries, without any countries missing from the total for the first time in months. These also showed the difference between OPEC output based on member-countries’ own submissions, and that provided by OPEC’s list of secondary sources, which include consultants and industry media, to be narrowing. "I can see some countries trying to address these problems and publish better data," said an oil market expert working for a European government. "But […]

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Tensions Flare Over Tanker Seeking Libyan Crude

ENLARGE A January photo of the Mellitah Oil and Gas terminal on the outskirts of Zwara in western Libya after fighters from the Islamist-backed Fajr Libya militia secured the perimeter of the oil complex. Photo: Agence France-Presse/Getty Images An oil tanker booked to load Libyan crude has sparked a fraught question over the North African country’s huge crude reserves: Who has the right to sell the oil when two governments are battling for control of the nation? The dispute is at the center of the struggle for control of Libya since the ouster and death of dictator Moammar Gadhafi and the nation’s descent into violence and instability. The issue has become muddier in recent weeks after a string of terrorist attacks and sabotage crippled the oil industry. The Vito, a tanker controlled by Aurum Ship Management of the United Arab Emirates, has been chartered to load 1.3 million barrels […]

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Saudi Arabia Wooing Fired U.S. Shale Workers to ‘Join Our Team’

A floor hand signals to the driller to pull the pipe from the mouse hole on Orion Drilling Co.’s Perseus drilling rig near Encinal in Webb County, Texas, U.S. For decades, the Saudis have recruited workers from the U.S. for its conventional drilling programs, offering hefty salaries and benefits as lures. Photographer: Eddie Seal/Bloomberg (Bloomberg) — Workers fired from U.S. shale fields after the collapse in oil prices could soon have a new boss: the nation some blame for driving that decline. The state-owned Saudi Arabian Oil Co., also known as Saudi Aramco, is posting new job ads online aiming to snap up experts in extracting oil from shale as the country seeks to become a leader in that rapidly expanding effort. Tens of thousands of U.S. workers have been fired since November as oil prices plunged because of oversupplies, driven in part by an OPEC decision supported by […]

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Saudi Arabia Needs More Oil to Feed Local Refinery Expansion

(Bloomberg) — Saudi Arabia’s plans to expand local refineries while maintaining its share of the global crude market point to one thing: higher production. The world’s largest oil exporter will probably increase output this year to feed new refineries, deepening a global supply glut, according to analysts at Societe Generale SA and DNB ASA. The kingdom may go as high as 10 million barrels a day by April, according to Torbjoern Kjus, an analyst at DNB in Oslo. That would be the most in more than two years, according to data compiled by Bloomberg. “Saudi Arabia will do the same thing as other OPEC members have always been doing: They’ll produce as much as they can,” Kjus said by phone March 11. Fellow OPEC members, the United Arab Emirates and Kuwait, will probably do the same because “they don’t want to be holding back on any potential exports.” Crude’s […]

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Iran Can Add Million Barrels a Day of Oil Without Sanctions

(Bloomberg) — Iran could raise oil exports by 1 million barrels a day if international sanctions were lifted, its oil minister said, as talks resumed with the U.S. over its nuclear program. “If sanctions are lifted, we can raise our exports by one million barrels per day within a few months,” Oil Minister Bijan Namdar Zanganeh said Monday in Assaluyeh, Iran. The Persian Gulf nation shipped 1.2 million barrels a day last month, the International Energy Agency said in a March 13 report. Iran and world powers are negotiating an agreement to end a decade-long dispute over the Persian Gulf country’s nuclear program. Diplomats from the U.S. and Iran, working toward an end-March deadline, resumed talks Monday in Lausanne, Switzerland. “If we get an announcement of a framework deal within the next couple of weeks, obviously from a market psychology, we’re going to have a bearish knee-jerk reaction,” Mike […]

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Iran’s Nuclear Deal Could Open Oil Flood

ENLARGE An Iranian worker at an oil refinery south of the capital Tehran. Direct sanctions on international purchases of Iranian oil, enacted in 2012, have gutted Iran’s exports, cutting crude sales in half to between 1 million to 1.2 million barrels a day over the past year. Photo: Associated Press Iran, the U.S. and its allies are pushing ahead with talks over a nuclear deal that would change many things—perhaps none faster than the price of oil. Iranian exports in recent years have been essentially capped by Western sanctions aimed at pressuring Tehran over its nuclear ambitions. A deal easing those sanctions could eventually translate into half a million barrels or more in Iranian crude heading into a currently glutted global market, analysts estimate. With global crude prices already under pressure, a deal could quickly knock them lower. Some traders even cited the resumption of talks this week between […]

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GOP Letter Emerges as Issue in Iran Talks

ENLARGE Supporters of the Iranian opposition protest ahead of the Iran nuclear talks held in Lausanne, Switzerland, during a rally in Brussels on Monday. Photo: European Pressphoto Agency LAUSANNE, Switzerland—Iranian diplomats voiced concerns in a meeting Monday with U.S. Secretary of State John Kerry about a letter sent by Republican U.S. lawmakers to Tehran’s leadership this month in which they threatened to block any agreement reached on Iran’s nuclear program, according to U.S. and Iranian officials. The letter wasn’t “helpful” to the negotiations, said a senior U.S. official, and was raised in talks by Iranian Foreign Minister Javad Zarif with Mr. Kerry during roughly five hours of meetings at the Swiss lakeside city of Lausanne on Monday. But the American diplomat stressed the U.S. and Iranian sides remained committed to forging a comprehensive agreement to curtail Iran’s nuclear program by a March 31 diplomatic deadline. The official added that […]

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Iran nuclear talks intensify as sides face tough issues

LAUSANNE, Switzerland (Reuters) – Efforts to reach a political agreement on Iran’s nuclear program by the end of the month intensified on Tuesday as negotiations between the United States and Iran resumed, and Western officials warned that tough issues remained unresolved. The U.S. and Iranian delegations led by U.S. Secretary of State John Kerry and Iranian Foreign Minister Mohammad Javad Zarif began another round of talks in the Swiss city of Lausanne after the Iranians returned overnight from Brussels where they had met European foreign ministers. Senior European officials were expected in Lausanne later on Tuesday, with foreign ministers possibly joining them at the end of the week if talks advance. A Western diplomat said "we’re still not there yet" on reaching an end-March deadline for a framework agreement between Iran and six major powers — the United States, Britain, France, Germany, Russia and China. "We’ll see what happens […]

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Iran Sent Arms to Iraq to Fight ISIS, U.S. Says

WASHINGTON — Iran has deployed advanced rockets and missiles to Iraq to help fight the Islamic State in Tikrit, a significant escalation of firepower and another sign of Iran’s growing influence in Iraq. United States intelligence agencies detected the deployments in the past few weeks as Iraq was marshaling a force of 30,000 troops — two-thirds of them Shiite militias largely trained and equipped by Iran, according to three American officials. The officials spoke on condition of anonymity to discuss sensitive intelligence reports on Iran. Iran has not yet launched any of the weapons, but American officials fear the rockets and missiles could further inflame sectarian tensions and cause civilian casualties because they are not precision guided. Their deployment is another dilemma for the Obama administration as it trains and equips the Iraqi military and security services to help defeat the Islamic State, but unlike Iran is unwilling to […]

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OPEC Warns U.S. Oil Boom Could Be Over by Year-End

OPEC said Monday the U.S. oil boom could be over by the end of this year, offering a pessimistic view of American producers’ ability to withstand a historic collapse in crude prices and predicting that global petroleum supplies would realign with demand. The cartel, in its closely watched monthly oil-market report, cited spending cuts by U.S. producers and the falling number of American rigs drilling for oil in recent months after crude prices fell by about 60% from last summer to January before rallying in February. For instance, rig counts fell faster in February than they did in January, according to the latest Baker Hughes report. The Organization of the Petroleum Exporting Countries report comes when oil markets are at a crossroads and demonstrates the uncertainty over the staying power of the American oil boom. Just last week, the International Energy Agency said that American producers were defying expectations […]

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Eni envisions $5 billion investments in Egypt

Italian energy company Eni signs framework agreement that envisions large-scale investments in country’s oil and gas reserves. Photo courtesy: Eni Italian energy company Eni said it signed a framework agreement to develop Egyptian oil and gas reserves that calls for as much as $5 billion in investments. Eni Chief Executive Officer, Claudio Descalzi, met over the weekend with Egyptian Petroleum Minister Sherif Ismail on the sidelines of an economic summit in Sharm el-Sheik. The framework agreement calls for as much as $5 billion in total investments. "The investments, which will be utilized through the realization of projects to be implemented in the next 4 years, are directed to the development of 200 million barrels of oil and 1.3 trillion cubic feet of natural gas," the Italian company said in a Saturday statement. "These investments will also contribute effectively to the increasing energy needs of local demand." Political and economic […]

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Significant gas discovery made in Libya

Italian energy company Eni reports what it says is a major natural gas discovery off the Libyan coast. UPI/Maryam Rahmanian Italian energy company Eni said Monday it made what it considers to be a significant discovery of natural gas off the coast of war-torn Libya. The company said it produced about 29 million cubic feet of natural gas per day from a discovery well off the Libyan coast . Its estimated capacity is 50 million cubic feet per day and its proximity to existing production infrastructure will allow for rapid development. "This exploration success further confirms the enormous potential of Libyan gas resources," the company said in a statement. "The future development of Libyan resources will allow supporting the growth of the domestic consumption and industry, while maintaining Libya’s position as a strategic supplier for Italy and Europe." Italy received nearly 10 percent of its natural gas from Libya’s […]

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PetroChina Vice Chairman Under Investigation

ENLARGE Liao Yongyuan, PetroChina’s vice chairman, is suspected of ‘serious law and discipline violations,’ according to a brief statement from a Communist Party agency. Photo: Zuma Press BEIJING—The vice chairman of major Chinese oil producer PetroChina Co. has been placed under investigation as China’s anticorruption drive continues to shake up its massive state-owned parent company. Liao Yongyuan most recently served as vice chairman of U.S.-listed PetroChina and as general manager at the state-owned parent company China National Petroleum Corp., the country’s largest oil and natural gas producer by volume. A brief dispatch by the Communist Party’s Central Commission for Discipline Inspection released Monday night said Mr. Liao was suspected of “serious law and discipline violations,” though no details were given. The term is typically used by the party watchdog in cases of suspected graft. Mr. Liao couldn’t be reached for comment, and it wasn’t known whether he had a […]

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Citi Sees Slower Commodities Demand Growth as China Recedes

(Bloomberg) — Global commodity markets will see slower and less synchronized demand growth from across the world as China’s dominance fades, according to Citigroup Inc. Global demand expansion, which centered on the rise of China in the 2000s, will slow in the next decade and be driven increasingly by India, Southeast Asia, the Middle East, Latin America and Africa, the New York-based bank said in a report e-mailed Tuesday. While demand will increase from these regions, dubbed the “Emerging 5”, it won’t be enough to offset the impact of slower growth from China, Citigroup said. Commodities tumbled to a 12-year low on Monday, with crude oil in New York slumping 18 percent in 2015. Inventories are rising after a decade-long bull market spurred farmers, miners and drillers to increase production just as economic growth slowed in China. The world’s biggest metals and energy consumer grew at the slowest pace […]

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China orders over 600,000 ton Ukrainian corn, snubs U.S. supplies

BEIJING (Reuters) – China, the world’s second largest corn consumer, has booked over 600,000 tonnes of corn from Ukraine this year and more deals are expected as Beijing’s stockpiling dries up supplies and boosts domestic prices. China’s move to import Black Sea shipments under a loan-for-grain deal is seen as a blow to U.S. corn exporters who are struggling to sell the country’s record crop. U.S. corn futures fell for a fourth straight session on Tuesday, trading near a six-week low with additional pressure from China’s purchases of Ukrainian corn. Some of the Ukraine cargoes for April-May shipment were struck at about 1,500 yuan ($240) per ton, including cost and freight, said one buyer. The price is about 60 percent lower than domestic corn quoted at 2,490 yuan per ton in the major port of Shenzhen. U.S. corn is quoted about 80 yuan ($13) per ton cheaper than Ukraine […]

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California Is Turning Back Into A Desert And There Are No Contingency Plans

California Is Turning Back Into A Desert And There Are No Contingency Plans thumbnail Once upon a time, much of the state of California was a barren desert.  And now, thanks to the worst drought in modern American history, much of the state is turning back into one.  Scientists tell us that the 20th century was the wettest century that the state of California had seen in 1000 years.  But now weather patterns are reverting back to historical norms, and California is rapidly running out of water.  It is being reported that the state only has approximately a one year supply of water left in the reservoirs, and when the water is all gone there are no contingency plans.  Back in early 2014, California Governor Jerry Brown declared a drought emergency for the entire state, but since that time water usage has only dropped by 9 percent.  That is […]

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U.S. fuel consumption is soaring amid cheaper prices

LONDON (Reuters) – Fuel demand in Texas is growing strongly as lower oil prices encourage motorists to use their vehicles more and buy larger replacements. Receipts of motor fuel taxes in February 2015 were 6 percent higher than in the same month in 2014, according to the Texas Comptroller of Public Accounts. Texas collected almost $284 million in motor fuel taxes last month compared with $269 million in February 2014 according to the comptroller’s monthly Revenue Watch report ( link.reuters.com/xas34w ). Motor fuel taxes must be paid to the comptroller by the 25th day of the month after which they are collected by suppliers and distributors, so the February receipts are for gasoline and diesel sold in January. Year-over-year collections – and by extension gasoline and diesel sales – are growing at the fastest rate for more than a decade. Texas consumed 35.7 million gallons of gasoline and 20.1 […]

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Canada Crude Falls Below $30; BMO Seeks Oil Sands Cost Cuts

(Bloomberg) — Canadian heavy oil prices fell below $30 for the first time in more than six years as Bank of Montreal warned that oil sands producers must cut costs. Western Canadian Select fell 59 cents to $29.85 at 12:28 p.m. Mountain time, the lowest since Feb. 18, 2009, according to data compiled by Bloomberg. The grade’s discount to U.S. benchmark West Texas Intermediate narrowed 80 cents to $13.60 a barrel. Crude futures settled at a six-year low of $43.88 in New York on concern record supply may strain storage capacity. The cash costs of oil sands producers must shrink to remain competitive in the “new normal of lower oil prices for longer,” BMO analyst Randy Ollenberger said in a note today. The majority of Canada’s crude comes from oil sands in Northern Alberta and is among the most expensive to produce. Companies including Royal Dutch Shell Plc and […]

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Exxon CEO Said to Visit Moscow Amid Talk of More Sanctions

Exxon Mobil Corp. Chief Executive Officer Rex Tillerson said, North American shale “is more resilient than some people think it is.” Photographer: Andrey Rudakov/Bloomberg (Bloomberg) — Exxon Mobil Corp. leader Rex Tillerson is visiting Moscow this week for meetings with Russian oil producer OAO Rosneft and government officials amid talk of further sanctions, according to people familiar with the matter. The chief executive officer, who increased Exxon’s drilling rights in Russia fivefold last year, has preliminary plans to meet with officials on Wednesday, said two of the people who asked not to be identified because details of the visit are confidential. Exxon declined to comment, saying the travel plans of its executives aren’t public. The trip comes even as the U.S. and Europe consider further sanctions on Russian companies and individuals over the annexation of Crimea one year ago. Exxon snapped up millions of acres in Russia last year, […]

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