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Pope Summons Scientists to Shape Climate Change Debate

Pope Francis blesses the faitfhul during his weekly general audience at the Vatican on April 15. Photographer: Vincenzo Pinto/AFP/Getty Images Pope Francis summoned scientists, government officials and religious leaders to a villa in the manicured Vatican Gardens on Tuesday as he stepped into the heated climate-change debate. “Climate change is a defining issue of our time,” United Nations Secretary-General Ban Ki-Moon told attendees at the Vatican conference. “It is a moral issue, it is an issue of social justice, human rights and fundamental ethics.” The conference, which is being held under the auspices of the Pontifical Academy of Sciences, precedes a papal encyclical scheduled for publication in June. The encyclical, a letter to the world’s bishops but with broader resonance because of the pope’s moral and political authority, will aim to influence a UN summit in Paris at the end of the year, at which nations may pledge to […]

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UK warns off BP suitors now Shell unavailable as ‘white knight’

LONDON (Reuters) – Britain’s warning to potential suitors of BP is a sign of the oil major’s vulnerability to a takeover bid and that a more politically palatable tie-up with Royal Dutch Shell no longer seems to be an option, banking and industry sources said. Despite championing a laissez-faire policy towards takeover deals, Britain has always had a special interest in BP, dating back to the creation of the company via an unusual government investment master-minded by Winston Churchill. But in the past when the company has looked vulnerable, there was always the prospect that Anglo-British peer Shell could act as a "white knight" and agree to a merger deal that would preserve British interests. With Shell now tied up with a $70 billion takeover of BG, that seems much less likely, prompting the outgoing British government to break cover and say it would oppose any bid for BP. […]

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75% of Heat Waves Are Attributable to Climate Change

Blame global warming for about 75 percent of the world’s unusually hot days and 18 percent of its extreme snow or rain, according to a new paper in the journal Nature Climate Change. Heat waves and heavy storms are occurring at least four times more often than they did before carbon pollution started driving up thermometers. Global average temperatures are now about 0.85 degrees Celsius (1.4 Fahrenheit) higher than before industrialization. Additional heat and precipitation are expensive. Severe weather costs the U.S. economy as much as $33 billion a year, according to a U.S. Energy Department report released April 21. And those figures will increase as the planet continues to warm, as climate change may not be smooth or gradual, according to the new paper. At 2 degrees Celsius — United Nations climate negotiators’ avowed upper limit — extremely hot days may be twice as likely as at 1.5 […]

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Oil falls more than 1 pct, U.S. crude stockpiles set for another high

SINGAPORE (Reuters) – Oil fell more than 1 percent on Tuesday ahead of weekly U.S. crude inventory data that is expected to hit another high and as Saudi Arabia pledged to supply more oil to China if needed. U.S. commercial crude stockpiles were expected to have risen last week for the 16th straight week, up from a record 489 million barrels, even though drilling activity fell, a preliminary survey by Reuters showed on Monday. Comments from top Saudi oil officials on Monday reiterated the country’s position of keeping production high to meet demand as it maintains its market share. Brent June crude futures had dropped 84 cents to $63.99 a barrel by 0702 GMT. U.S. June crude fell 84 cents to $56.14 a barrel. The fall in prices "reflects the major gains that have been made in the last few weeks and a little bit of concern over what […]

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Oil Slides but Likely to Remain Volatile

By Eric Yep Crude-oil futures fell in Asian trade Tuesday with Brent dropping below the $65 mark, but prices are likely to stay volatile on uncertainty over the latest rally. On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $56.21 a barrel at 0506 GMT, down $0.78 in the Globex electronic session. June Brent crude on London’s ICE Futures exchange fell $0.78 to $64.05 a barrel. Oil prices fell for the second straight day this week after a rally earlier this month, with Nymex crude up by nearly 19% month-to-date and Brent crude prices up by more than 17%. Some of the recent price support came from expectations that U.S. oil production will start declining soon. "The oil market has likely passed through the worst period, but it is not out of the woods yet," analyst Michael Cohen at Barclays Research said. […]

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Oil-Industry Debt Mounts Up

ENLARGE Sinopec sold $6.4 billion of bonds last week. Above, employees refuel a car at a Sinopec gas station in Hong Kong in March. Photo: Bloomberg News SINGAPORE—Oil and gas companies are continuing to pile up debt, a trend some warn could extend the slump in energy prices and hit economies reliant on the sector for growth and tax revenue. Both independent and state-owned companies are involved in the borrowing bonanza, issuing $86.8 billion worth of bonds in dollars, euros and yen globally this year, up 10% from the same period in 2014, according to Dealogic, a data-tracking company. The rise is largely due to a high number of bond sales in Europe, the Middle East and Africa, and in the U.S., where both Exxon Mobil Corp. and Chevron Corp. have recently tapped investors. The debt surge has been less dramatic in Asia. Still, China Petrochemical Corp., known as […]

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Brent crude holds near 4-1/2 month high on U.S. rig count, Yemen

SINGAPORE (Reuters) – Brent crude prices held near a 4-1/2 month high above $65 a barrel on Monday, supported by concerns over fighting in Yemen disrupting Middle East supplies and signs that U.S. shale output may have started to decline. The number of active U.S. rigs drilling for oil has fallen for a record 20 weeks in a row to the lowest since 2010, according to Baker Hughes data, fuelling expectations of a drop in U.S. production. Brent had edged down 5 cents to $65.23 a barrel by 0623 GMT, after posting its third weekly gain last week and touching a Dec. 10 high of $65.80. U.S. crude fell 14 cents to $57.01 a barrel, after rising for the sixth consecutive week in its longest stretch of gains since the first quarter of 2014. "Sustaining the recent oil price rally requires firmer demand and a tangible supply response," Barclays […]

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Deflation? Oil’s 45 percent rebound could be markets’ next headache

LONDON (Reuters) – Whisper it, but the next challenge for financial markets and policymakers may not be deflation, but the remarkable surge in oil prices from the six-year low touched in January. Since then, Brent crude futures have risen 45 percent. If that is sustained or even increased throughout this year, inflation next year could rise significantly, posing questions for policymakers largely committed to ultra-loose policy. No fewer than 27 central banks around the world have eased monetary policy to some extent this year in a battle against deflation, slowing growth or both. These measures have ranged from interest rate cuts to bond-buying "quantitative easing" programs. All have been in response to the fall in inflation rates and inflation expectations driven by the 60 percent collapse in oil prices over the latter part of last year. Investors’ bets on the timing of the first interest rate increase from the […]

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Natural Gas Prices Plunge on Low Spring Demand

Natural gas prices plunged to their lowest point in nearly three years as weather updates suggest this spring could bring some of the weakest demand in more than a decade. Prices for the front-month May contract declined 4.1 cents, or 1.6%, to $2.49 a million British thermal units on the New York Mercantile Exchange. Trading on the June contract surpassed May. May options expired at close and futures expire Tuesday. The June contract declined 5.4 cents, or 2.1%, to $2.514/mmBtu. May’s settlement is lowest since June 15, 2012. Prices were down more than five cents as soon as electronic trading began Sunday evening, but did pare some of those losses in the afternoon. A Sunday-evening plunge is often a sign that weather updates are the dominant factor in trading. Traders, especially those using automated computer systems, will often have immediate, strong reactions to weather updates when they come after […]

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U.S. weighs greater role for Iraqis in joint military operations

A member of the Iraqi forces checks the horizon during a recent patrol west of Baghdad. U.S. officials are considering training Iraqi troops to act as ground controllers for airstrikes. (Ahmad al-Rubaye / AFP/Getty Images) The Obama administration is considering training Iraqis to handle ground control for airstrikes, a move that would significantly expand their role in the fight against the militant group Islamic State, a senior administration official said Thursday. The administration has been reluctant to put U.S. special forces at risk by deploying them on the ground in Iraq to call in strikes against targets associated with Islamic State, also known as ISIS or ISIL. At the same time, officials have been reluctant to rely on the Iraqis for a job that requires lengthy training. But the absence of what the military calls joint terminal attack controllers has lengthened the time it takes to direct airstrikes, raising […]

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Iraq Expects New US-Made F-16s in July to Boost IS Fight

BAGHDAD — Iraq will at long last be getting the first batch of F-16 fighter jets it ordered four years ago, its air force commander said Thursday, a shipment that is expected to boost Iraq’s capabilities in battling the extremist Islamic State group. Lt. Gen. Anwar Hama Amin said the fighters would arrive on July 12 along with the U.S.-trained Iraqi pilots and spare parts and would immediately begin carrying out operations, according to a statement posted late Wednesday on the Defense Ministry’s web site. The U.S. Embassy in Baghdad did not confirm the date, and only said the planes were expected by the summer. Iraq first ordered the 18 jets for $3 billion in 2011 to supplement its almost nonexistent air force. A year later, then-Prime Minister Nuri al-Maliki complained over the delays in delivering the planes. The pilots have been training with three of the planes in […]

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Iranian General Says Saudi Arabia Will Soon Be Toppled

TEHRAN — A senior Iranian general said on Monday that the leadership of Saudi Arabia , a regional rival, was on the edge of collapse and would be toppled soon, “God willing.” Saudi-led bombardments on Yemen are “shameless and rude and an affront to all Islamic values,” the head of the 150,000-strong Islamic Revolutionary Guards Corps, Gen. Mohammad Ali Jafari, said during a speech in Tehran. Last week, Saudi Arabia announced a halt to its operations in Yemen, which started a month ago, only to restart bombing a day later . Over 1,000 people have been killed after the Houthi rebels, who are financially supported by Iran , swept through Yemen, taking advantage of years of infighting among Sunni leaders. A coalition of Arab countries, led by Saudi Arabia, is trying to push the Houthis back using airstrikes. “The traitor Saudi Arabia is following the path of Israel,” General […]

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Saudi demand views lift oil prices

Saudi officials see oil as a center piece of global economic momentum, telling China more oil is available if needed. Photo by Stephen Shaver/UPI NEW YORK, April 27 (UPI) — Crude oil prices edged higher in Monday trading after Saudi officials said Monday there would be ample oil on hand to meet China’s growing demand. Brent crude oil edged up a fraction of a percent in Monday trading to $65.37 per barrel for the June contract. Brent crude oil, which topped $100 per barrel in June 2014, remains traded in a bear market, but gained nearly 18 percent since the start of April . Crude oil prices remain depressed in a market favoring the supply side. Saudi Arabia has maintained a high level of oil production despite the slump, arguing it needs to protect its market share in an economy in flux because of the glut of U.S. oil. […]

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Saudi high oil output based on demand, market ‘excellent’: Dep Oil Minister

KHOBAR, Saudi Arabia (Reuters) – Saudi Arabia’s high crude oil production policy is based on the status of global demand and the top oil exporter is keen to maintain its market share, the kingdom’s deputy oil minister said on Monday. Speaking to reporters in Saudi Arabia, Prince Abdulaziz Bin Salman Bin Abdulaziz described the oil market as "excellent", suggesting the OPEC heavyweight was comfortable with current global conditions. "As the minister mentioned, the kingdom responds to demand and supplies oil to wherever the demand is and whoever asks for it," he said. "We care about our market share, we care about maintaining our customers and we care about the stability of the market." Prince Abdulaziz was referring to previous comments made by Saudi Oil Minister Ali al-Naimi who said last week that the kingdom was producing near-record levels of crude in April at around 10 million barrels per day. […]

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Saudis pound arms depots in Yemen as bread, medicine run short

ADEN (Reuters) – The humanitarian situation in Yemen has become catastrophic, relief officials said on Monday, as Saudi-led aircraft pounded Iran-allied Houthi militiamen and rebel army units for a second day, dashing hopes for a pause in fighting to let aid in. Residents said warplanes flew between 15 and 20 sorties against groups of Houthi fighters and arms depots in the al-Dhalea provincial capital, Dhalea, and the nearby city of Qa’ataba, between dawn and 0900 local time (0600 GMT), setting off a chain of explosions that lasted for two more hours. Fighting intensified on Sunday, after a lull following an announcement by Riyadh last week that it was ending its nearly five-week-old bombing campaign except in places where the Houthis were advancing, to allow access for food and medicine. A coalition of Arab countries led by Saudi Arabia, rattled by what they saw as expanding Iranian influence in the […]

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Nigerian Oil-Revenue Audit Report Published

An audit ordered by Nigeria’s outgoing president was published on Monday, seeking to explain why $19 billion in oil revenue never made it into the government’s bank accounts. The report caps a year-long political debate over how Africa’s top oil exporter manages its revenue, a debate that help lead to President Goodluck Jonathan’s ouster last month. PricewaterhouseCoopers Ltd., which conducted the audit, said Nigeria’s state-owned oil company, Nigerian National Petroleum Corp., deposited $19 billion less than expected from January 2012 to July 2013. According to the report, $10 billion went to kerosene and motor fuel subsidies. The remainder went to operations itemized by the audit, such as $2 billion spent financing the growing debt of the company. The oil company spends so much money on fuel subsidies and other operations that it may operate close to a loss this year, barring an overhaul or a rise in oil prices, […]

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Floating LNG regasification is used to meet rising natural gas demand in smaller markets

Floating regasification is a flexible, cost-effective way to receive and process shipments of liquefied natural gas (LNG). Floating regasification is increasingly being used to meet natural gas demand in smaller markets, or as a temporary solution until onshore regasification facilities are built. Of four countries planning to begin importing LNG in 2015, three of them—Pakistan, Jordan, and Egypt—have chosen to do so using floating regasification rather than building full-scale onshore regasification facilities. Floating regasification involves the use of a specialized vessel called a floating storage and regasification unit (FSRU), which is capable of transporting, storing, and regasifying LNG onboard. Floating regasification also requires either an offshore terminal, which typically includes a buoy and connecting undersea pipelines to transport regasified LNG to shore, or an onshore dockside receiving terminal. An FSRU can be purpose-built or be converted from a conventional LNG vessel. Floating regasification offers a flexible, cost-effective solution for […]

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Pemex Official Says Mexico Is Confident of U.S.’s Approval on Oil Swap

MEXICO CITY—It has been eight months since national oil firm Petróleos Mexicanos applied for a permit to buy U.S. light oil in a swap for Mexico’s heavier blend, but the company says it is confident it will get U.S. Commerce Department approval and isn’t looking to alternative sellers, a senior Pemex official said. “The signs are positive,” said José Manuel Carrera, head of Pemex’s commercial arm PMI. “We continue to be respectful, but always very insistent that this happens as soon as possible,” he said in an interview last week. The U.S. maintains a ban on crude-oil exports dating back to the 1970s, but swaps are allowed when exports are balanced by additional imports. And while both the U.S. and Canada allow swaps, the subject is politically sensitive given how dependent the U.S. has been on massive oil imports in the recent past. There is little precedent to measure […]

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Exclusive: U.S. examining coal cleanup program for shortfalls

BALTIMORE (Reuters) – The federal government is examining whether struggling U.S. coal companies still qualify for an exemption that allows them to avoid having to fully insure against billion-dollar mine cleanup costs, the top regulator for the mining industry said on Monday. Within the last several weeks, federal officials have begun to scrutinize the "self-bonding" programs that allow financially qualified mining companies to leave part of their potential clean-up costs uninsured, said Joseph Pizarchik, director of the Office of Surface Mining Reclamation and Enforcement (OSMRE). Coal states regulate mining operations – including the federal self-bonding program – on a day-to-day basis but federal officials may step in if not enough is done to guarantee cleanup work, or "reclamation". Insurance and legal experts say many U.S. coal companies would struggle to pay for full insurance against cleanup costs and lifting the exemption could push them closer to bankruptcies. "The state […]

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China’s Antigraft Authority Takes Aim at Sinopec

ENLARGE Wang Tianpu, president of China’s state-owned oil-and-gas company Sinopec Group, is being investigated for alleged discipline violations. Photo: Bloomberg BEIJING—China’s leaders are deepening their probes into China’s distressed oil sector as the nation’s top refiner faced new scrutiny on Monday, illustrating the staying power of an antigraft drive that has shaken China’s powerful state-owned enterprises. China’s antigraft authority is taking aim at Sinopec Group, a lynchpin of China’s economy that in recent years stood as a symbol of its global oil ambitions. Accusations against a top company executive are likely to add to what have been several years of uncertainty in China’s oil sector, which has already curtailed spending at home and slowed investment abroad partly as a result of unprecedented government scrutiny. The Communist Party’s Central Commission for Discipline Inspection said in a notice late Monday that Wang Tianpu , president of state-owned oil-and-gas company Sinopec Group, […]

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China Readies Fresh Easing to Tackle Specter of Debt

ENLARGE A pedestrian walks past the People’s Bank of China headquarters in Beijing. The central bank is planning fresh easing measures to tackle a worrying buildup of local-government debt. Photo: Bloomberg News BEIJING—China’s central bank is planning to launch its own version of innovative credit-easing programs adopted by its counterparts in developed countries, according to officials with knowledge of the matter, as Beijing’s flagship plan to restructure trillions of dollars of local-government debts is hitting snags. Under the plan, which could be put in place in the next couple of months, the People’s Bank of China will allow Chinese banks to swap local-government bailout bonds for loans as a way to bolster liquidity and boost lending, the officials said. The strategy—dubbed Pledged Supplementary Lending—is similar to the long-term refinancing operations, or LTROs, used by the European Central Bank. The Wall Street Journal reported last week that the central bank […]

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Bakken Rig Count Falls Below 80

Bakken Oil Workers The Bakken-Three Forks rig count dropped by five to 79 rigs running across our coverage area by midday Friday. In recent Bakken news, the Department of Transportation  issued an emergency order on Friday that establishes a maximum speed of 40 miles an hour for certain trains going through high threat urban areas. Read more: DOT Tells Oil Tankers to Slow Down The U.S. rig count fell again this week by another 22 ending at 932 rigs running by midday Friday.  A total of 225 rigs were targeting natural gas (and increase of eight  from the previous week) and 703 were targeting oil in the U.S. (31 less than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)   79 rigs are running in the Williston Basin across MT, ND, and SD. 78 are in ND alone. Bakken Oil & Gas […]

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Hess: Exports will keep U.S. shale alive

U.S. energy company Hess Corp. argues for a repeal of a 1970s ban on crude oil exports to breath life into a waning shale industry. Photo by Oskari Porkka/Shutterstock NEW YORK, April 27 (UPI) — Keeping U.S. crude oil "trapped" in the domestic market may be undermining the health of the shale industry, the top executive at Hess Corp. said. Arab members of the Organization of Petroleum Exporting Countries stopped exporting oil to the United States in response to U.S. support for Israel in the 1970s. The U.S. Congress responded in kind by passing legislation restricting crude oil exports in part to protect the domestic market from overseas influence. Nearly four decades later, those in the exploration and production side of the U.S. energy sector argue that policy is outdated in an era when domestic shale is leaving storage facilities overflowing with domestic crude oil. "Part of the reason […]

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Traders alarmed oil glut is a strain on West Texas storage tanks

NEW YORK (Reuters) – Four-hundred miles from the near overflowing tanks at the U.S. oil hub in Cushing, Oklahoma, a second glut in the Permian Basin of West Texas is pressuring oil prices once again as pipeline disruptions strand millions of barrels in the region. The Permian, the fastest-growing shale play, accounts for about a fifth of the country’s total oil production, and is expected to produce about 2 million barrels of crude a day in May. The region houses over 20 million barrels of crude storage. Stockpiles in the Permian have hit several records in the last four weeks, according to data from industry information provider Genscape. Investors have zeroed in on storage, waiting for declines in weekly inventory data to signal demand is rising or production is beginning to taper off. Stockpiles in Cushing, the delivery point for the U.S. futures contract, hit a record in the […]

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Slowdown and out in Williston, ND

Andy Richter for Al Jazeera America A free meal is served Sunday nights at Banquet West, a weekly community event at First Lutheran Church in Williston, N.D., March 1, 2015. Andy Richter for Al Jazeera America Oil tankers fill up outside of Williston. Since fracking began in the Bakken Shale in the late 2000s, the city’s population has more than doubled. WILLISTON, N.D. — From an airplane at night, Williston appears an oasis of thousands of points of light on the Great Plains. Most are white or yellow, but some flicker bright orange. They are the oil drilling rig flares of the Bakken Shale formation — fires that burn night and day. But dozens of these fires have gone dark in the last eight months. Williston has been pummeled by plunging oil prices worldwide, which dropped from a $105 a barrel in February 2014 to $54 in February 2015. […]

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Eagle Ford, Permian Basin, and Bakken and Eagle Ford Scenarios

This is a guest post by Dennis Coyne Increased oil output in the US has kept World oil output from declining over the past few years and a major question is how long this can continue. Poor estimates by both the US Energy Information Administration (EIA) and the Railroad Commission of Texas (RRC) for Texas state wide crude plus condensate (C+C) output make it difficult to predict when a sustained decline in US output will begin.  About 80 to 85% of Texas (TX) C+C output is from the Permian basin and the Eagle Ford play, so estimating output from these two formations is crucial. I have used data from the production data query (PDQ) at the RRC to find the percentage of TX C+C output from the Permian (about 44% in Feb 2015) and Eagle Ford plays (40% in Feb 2015). Dean’s estimates of Texas C+C output are excellent […]

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North Dakota OKs New Oil Tax Framework, Ends Price Triggers

BISMARCK, N.D. (AP) — With oil prices sinking enough that drillers may soon see a more favorable tax rate, North Dakota lawmakers approved a new framework Friday that cuts the price-triggered exemption in exchange for a lower tax rate. North Dakota’s House voted 66-26 after a contentious debate to shave the state’s oil tax rate from 11.5 percent to 10 percent. Republicans believe the move offers better certainty for the state and industry, while Democrats say it could cost the state billions in future oil tax revenue. "We’re taking a real risk and probably something we can never get back," said Rep. Jerry Kelsh, D-Fullerton. Fargo Rep. Al Carlson, North Dakota’s House majority leader, and other GOP representatives said the new system will provide a stable and predictable tax policy that will help increase production, spur investment and boost the state’s economy. "We need to have what’s fair, what’s […]

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US to launch blitz of gas exports

US to launch blitz of gas exports thumbnail The United States is poised to flood world markets with once-unthinkable quantities of liquefied natural gas as soon as this year, profoundly changing the geo-politics of global energy and posing a major threat to Russian gas dominance in Europe. “We anticipate becoming big players, and I think we’ll have a big impact,” said the Ernest Moniz, the US Energy Secretary. “We’re going to influence the whole global LNG market.” Mr Moniz said four LNG export terminals are under construction and the first wave of shipments may begin before the end of this year or in early 2016 at the latest. “Certainly in this decade, there’s a good chance that we will be LNG exporters on the scale of Qatar, which is today’s largest LNG exporter,” he said, speaking on the margins of the IHS CERAWeek energy summit in Texas. Qatar exports […]

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BP Reports Fall in First-Quarter Profit Amid Weaker Oil Prices

ENLARGE A section of the BP Eastern Trough Area Project (ETAP) oil platform is seen in the North Sea, around 100 miles east of Aberdeen, Scotland. BP reported a fall in first-quarter profit on Tuesday. Photo: Reuters LONDON— BP PLC on Tuesday reported a fall in first-quarter profit from a year earlier, giving the first glimpse of how low oil prices through the beginning of 2015 affected the world’s biggest oil companies. BP’s replacement-cost profit—a number similar to the net income that U.S. oil companies report—was $2.1 billion, down from $3.48 billion a year earlier. Revenue fell to $54.9 billion from $75.1 billion from a year earlier. Production for the quarter was 8.3% higher than the first quarter of 2014 at 2.31 billion barrels of oil equivalent a day. “Looking ahead, we expect second-quarter 2015 reported production to be lower than the first quarter, reflecting significant seasonal turnaround and […]

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Russian envoy says politics behind Gazprom charges

Russian envoy to the European Union suspects politics at play in latest dispute over regional natural gas market. (UPI/Shutterstock/Igor Golovniov) BRUSSELS, April 27 (UPI) — Charges against Russian energy company Gazprom stem from Lithuania’s government, not energy companies, a Russian envoy told a European news outlet. The European Commission last week said it suspected Gazprom was violating antitrust rules by abusing its position in the Central and Eastern European markets. The European commissioner in charge of competition policy, Margrethe Vestager, said Gazprom was preventing gas from flowing from "certain Central Eastern European countries" and thereby prohibiting competition. Russian Ambassador to the European Union Vladimir Chizhov told European news service EurActiv the charges stem from the Lithuanian government . "What puzzled me from the beginning was that the whole case was initiated not by some economic entities, not by EU-based energy companies which could have theoretically complained about those contracts, […]

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Greece Just Clipped Varoufakis’s Wings

Greece’s Plan "B" Needs Politics Over Theory: Fricke Greece reshuffled its bailout-negotiating team, reining in Finance Minister Yanis Varoufakis, after three months of talks with creditors failed to unlock aid and a meeting with his euro-area counterparts ended in acrimony. The coordination of the day-to-day efforts to strike a deal with creditors was handed to Deputy Foreign Minister Euclid Tsakalotos, a Greek government official said in an e-mail to reporters Monday. Varoufakis will supervise the political negotiations with euro-area member states and the International Monetary Fund. No change was announced to Greece’s representation in euro-area finance ministers’ meetings, which Varoufakis attends. A Eurogroup meeting in Riga, Latvia on Friday descended into name-calling as the currency bloc’s finance ministers hurled abuse at their Greek colleague, accusing him of being a time-waster, a gambler and an amateur. Still, the 54-year-old academic-turned-politician in the government of Prime Minister Alexis Tsipras remains popular […]

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The bottom is in for oil prices

Traders think the decline in oil prices is over. A report from Bloomberg News on Sunday said traders had pulled their bets that oil prices would fall further at the “fastest pace on record,” citing data from the Commodity Futures Trading Commission, or CFTC. And according to John Kilduff at Again Capital, who spoke to Bloomberg last week, “The falling rig count and the reduction we’re starting to see in output shows that the bottom has in fact been installed … A lot of people are throwing in the towel.” Last week, oil prices rose for the sixth straight week, and West Texas Intermediate crude oil was trading near $57 a barrel Sunday night, up from its low of $43 hit back in March. Earlier this year, strategists at Citi called for oil prices to drop as low as $20 a barrel given that the glut of global supply, […]

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Brent crude holds near 4-1/2 month high on U.S. rig count, Yemen

SINGAPORE (Reuters) – Brent crude prices held near a 4-1/2 month high above $65 a barrel on Monday, supported by concerns over fighting in Yemen disrupting Middle East supplies and signs that U.S. shale output may have started to decline. The number of active U.S. rigs drilling for oil has fallen for a record 20 weeks in a row to the lowest since 2010, according to Baker Hughes data, fuelling expectations of a drop in U.S. production. Brent had edged down 5 cents to $65.23 a barrel by 0623 GMT, after posting its third weekly gain last week and touching a Dec. 10 high of $65.80. U.S. crude fell 14 cents to $57.01 a barrel, after rising for the sixth consecutive week in its longest stretch of gains since the first quarter of 2014. "Sustaining the recent oil price rally requires firmer demand and a tangible supply response," Barclays […]

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Oil-Fund Outflows Bode Ill for Prices

ENLARGE Money is pouring out of a popular investment tied to the oil market, a sign that a monthlong crude-price rally may be running out of gas. Exchange-traded funds that invest in U.S. oil futures, including the $3.1 billion United States Oil Fund LP, have registered about $2.7 billion of investor outflows this month, according to investment bank Macquarie Group Ltd. That reverses an inflow that started in January as oil prices tumbled. These ETFs took in roughly $6 billion this year through mid-March, when the U.S. oil benchmark hit a six-year low, according to Macquarie. Traders and analysts are closely watching weekly production and demand data for signs that the global glut of crude oil that sent prices swooning last year may be shrinking. They are also watching the ETF trends closely, because they say crude prices are vulnerable to a pullback following a 32% run-up since March […]

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New Amendments Imperil Measure on Iran in Congress

Photo Senator Bob Corker of Tennessee faces a major test in the handling of an Iran bill that would give Congress a voice in nuclear negotiations. Credit Stephen Crowley/The New York Times WASHINGTON — A bill to give Congress a voice in the nuclear deal with Iran is now endangered by Republican amendments that would peel away bipartisan support for a measure begrudgingly accepted by the White House this month. Amendments filed by lawmakers last week include one that would require Iran to recognize Israel and another that would give any final nuclear deal the status of a treaty, which would require ratification by two-thirds of the Senate. Another proposal would require the release of American citizens detained in Iran as part of an agreement. For Republican sponsors of the Iran measure, these amendments threaten to break the rare bipartisan spirit that pushed the bill unanimously out of the […]

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Nuclear deal could unleash Iran’s economy

After almost 15 years of intermittent negotiations, Iran and the P5+1 group of six major world powers have reached a comprehensive agreement over Iran’s nuclear program. The deal couldn’t have come soon enough for the Iranian economy, which has been crippled by sanctions imposed by the U.S. and United Nations. At the same time, state oil revenues are shrinking every day, and unemployment and inflation have both soared to levels not seen since the catastrophic Iraq-Iran War of the 1980s. Since 2010, sanctions have specifically targeted Iran’s central bank, leading to rapid currency devaluation and near-zero rates of economic growth. Living standards for the working class and low-income Iranians are abysmal, with many unable even to purchase basic medicine. The nuclear deal clears the path for the end of sanctions and the emergence of a dynamic Iranian economy. President Hassan Rouhani, whose cabinet includes more graduates of prestigious American […]

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Assad’s hold on power looks shakier than ever as rebels advance in Syria

BEIRUT — A surge of rebel gains in Syria is overturning long-held assumptions about the durability of President Bashar al-Assad’s regime, which now appears in greater peril than at any time in the past three years. The capture Saturday of the town of Jisr al-Shughour in northern Idlib province was just the latest in a string of battlefield victories by rebel forces, which have made significant advances in both the north and the south of the country. As was the case in the capital of Idlib province last month, government defenses in Jisr al-Shughour crumbled after just a few days of fighting, pointing as much to the growing weakness of regime forces as the revival of the opposition. The battlefield shifts come at a time when the Obama administration has set aside the crisis in Syria to focus on its chief priorities: defeating the Islamic State militant group in […]

Posted On : Published By : Tom Whipple
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Israeli Military Says It Killed Armed Men in Strike on Golan Heights Frontier

JERUSALEM — An Israeli airstrike killed members of an armed squad that was preparing to bomb Israeli forces on Sunday along the Israeli-Syrian frontier in the Golan Heights , the Israeli military said. The Israeli news media said that three or four men were killed in the missile strike. A spokeswoman for the Israeli military said the armed squad had crossed from the Syrian side into the Israeli-controlled part of the contested territory, which Israel captured from Syria in the 1967 war. Israel did not immediately identify the men, and it was not clear if they were Syrians or belonged to the Lebanese militant group Hezbollah. This latest flare-up along the increasingly tense cease-fire line came after reports in the Arabic news media of Israeli airstrikes in recent days. One was reported to be against Syrian Army bases in the Qalamoun region near Syria’s border with Lebanon, where Hezbollah […]

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In Syria, the Stakes Are High for a Rebel Offensive

Fighters from a coalition of rebel forces stand on a tank in the Syrian city of Idlib on March 29.(ZEIN AL-RIFAI/AFP/Getty Images) Summary Syrian rebels launched one of the largest and most ambitious operations of the Syrian civil war April 22. Around 9,000-12,000 fighters from 40 rebel groups assembled for a wide-scale offensive stretching across the northwestern provinces of Idlib and Hama. The operation brings together rebel factions with extremely diverse ideologies and strengths, ranging from the powerful jihadist Jabhat al-Nusra faction to smaller units affiliated with the Free Syrian Army. While determined and daring, the offensive — labeled "The Battle of Victory" — is risky: The rebels are going up against significant loyalist forces, including a number of highly trained and motivated elite units. Analysis The roots of the offensive lie in the rebels’ successful capture of the city of Idlib on March 28. As Stratfor previously noted, the capture […]

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Libya closes El Feel oilfield due to strike by security guards

TRIPOLI/BENGHAZI, Libya (Reuters) – A strike by Libyan security guards over salary payments has forced the closure of the western El Feel oilfield, a spokesman for state oil firm NOC said on Sunday. On Saturday, a field engineer told Reuters the OPEC producer had closed the field, without citing a reason. El Feel is operated by a joint venture owned by NOC and Italy’s Eni. "The field’s security guards are on strike because they complain about a delay of their salary payments," said Mohamed El Harari, a spokesman for NOC. "NOC paid the salaries to the security forces, but they haven’t paid the guards yet," he said. Libya this year had managed to restart El Feel, which analysts say produced about 100,000 barrels per day (bpd). Libya had to shut the field late last year when a group in the Zintan region, which opposes a self-declared government in Tripoli, […]

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Former U.N. envoy says Yemen political deal was close before Saudi airstrikes began

ENLARGE A Houthi militant walks past a house destroyed by an airstrike in the capital San’a on Sunday. Photo: khaled abdullah/Reuters UNITED NATIONS—Yemen’s warring political factions were on the verge of a power-sharing deal when Saudi-led airstrikes began a month ago, derailing negotiations for a national unity government, the United Nations mediator said. Jamal Benomar, the U.N. envoy who spearheaded those negotiations until he resigned last week, told The Wall Street Journal the bombing campaign against the Iran-linked Houthi rebels has hardened positions on a key point—the composition of an executive body to lead Yemen’s stalled transition from dictatorship to democracy. This will complicate new attempts to reach a solution, he said. “When this campaign started, one thing that was significant but went unnoticed is that the Yemenis were close to a deal that would institute power-sharing with all sides, including the Houthis,” said Mr. Benomar, a Moroccan diplomat. […]

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Nigeria: Buhari Vows to Probe ‘Missing’ NNPC $20 Billion

Nigeria’s President-elect, Muhammadu Buhari, has stated that his administration will probe the $20 billion alleged to be missing from the coffers of the Nigeria National Petroleum Corporation, NNPC. The immediate past governor of the Central Bank of Nigeria, CBN, Sanusi Lamido, had alleged that the $20 billion made from the sale of Nigeria’s crude oil by the NNPC could not be accounted for. President Goodluck Jonathan sacked Mr. Sanusi from the CBN after he made the allegation. The former bank chief was later crowned the Emir of Kano after the death of Ado Bayero, the former emir. Speaking Sunday when he played host to a delegation from Adamawa State led by the state’s governor-elect, Bindow Jibrilla, in his campaign secretariat, Mr. Buhari said although he received information that some persons already started returning money to government coffers, he would only believe it when he "sees it". "I heard that […]

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Chinese energy figures suggest much slower growth than advertised

Last year China reported the slowest  economic growth in 24 years, about 7.4 percent . But the true figure may actually be much lower, and the evidence is buried in  electricity figures  which show just 3.8 percent growth in electricity consumption. David Fridley, a staff scientist in the  China Energy Group  at the  Lawrence Berkeley National Laboratory , has been a longtime collaborator with the Chinese on energy management, efficiency and policy. Fridley, who has held Chinese energy-related jobs for 35 years, believes that electricity consumption in China is a better indicator of its economic growth. Historically, electricity consumption and economic growth in China have been very closely linked. "From 2005 to 2013, the average elasticity of electricity demand was 1.09, meaning electricity demand was up about 1.09 percent for every percent rise in GDP," Fridley wrote in an email. "In 2014, that number fell to 0.51, the lowest […]

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Oil firms face further cuts as low prices linger

LONDON (Reuters) – Oil majors may need deeper cuts to oil and gas exploration and production spending as they grapple with an extended period of low crude prices. The industry is expected to reveal another set of grim earnings for the first quarter when benchmark Brent prices averaged $55 a barrel, almost half the level of a year ago. Exxon Mobil Corp., Royal Dutch Shell, BP and France’s Total have already responded by cutting 2015 capital spending by 10 to 15 percent, delaying and scrapping projects and cutting operating costs. And despite a sense among some industry executives that oil prices may have hit their 2015 lows following a decline in U.S. shale production, more cuts may be needed. Exxon, the world’s biggest listed oil company, has reduced 2015 capital spending by 12 percent to $34 billion. "We’ll see throughout the year whether we stay there (capex) or not, […]

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Traders alarmed oil glut is a strain on West Texas storage tanks

NEW YORK (Reuters) – Four-hundred miles from the near overflowing tanks at the U.S. oil hub in Cushing, Oklahoma, a second glut in the Permian Basin of West Texas is pressuring oil prices once again as pipeline disruptions strand millions of barrels in the region. The Permian, the fastest-growing shale play, accounts for about a fifth of the country’s total oil production, and is expected to produce about 2 million barrels of crude a day in May. The region houses over 20 million barrels of crude storage. Stockpiles in the Permian have hit several records in the last four weeks, according to data from industry information provider Genscape. Investors have zeroed in on storage, waiting for declines in weekly inventory data to signal demand is rising or production is beginning to taper off. Stockpiles in Cushing, the delivery point for the U.S. futures contract, hit a record in the […]

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Florida’s Hurricane-Free Stretch Has Insurer Bracing for Storms

The last hurricane to make landfall in Florida was Wilma in October 2005. Source: NOAA via Getty Images Florida hasn’t been hit by a hurricane since 2005, the longest stretch in more than a century. Its state-run property insurer isn’t taking any chances. Even though forecasters predict this year will produce the fewest named Atlantic storms since 1997, Citizens Property Insurance Corp., which provides coverage when other insurers won’t take the risk, is selling as much as $1 billion of municipal debt to raise cash just in case. It would be the insurer’s first bond sale in three years. With hurricane season set to start June 1, Citizens is taking advantage of interest rates close to generational lows to bolster its claim-paying ability. Investors in the insurer’s tax-exempt bonds welcome the steps toward a sturdier balance sheet: One storm is all it takes to rack up billions of dollars […]

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Demand For Key Types of Railway Cars Falls Amid Declining Output

Declining output from shale-oil fields cut demand for key types of railroad cars, new data shows, the latest sign of the fallout from lower oil prices. Buyers ordered 4,470 new railway tank cars during the quarter ended March 31, down 6% from a year earlier and about 70% from the 14,964 tank cars ordered during the fourth quarter, according to the Railway Supply Institute, a Washington-based trade group. Tank car orders had surged along with output from shale-oil fields, whose crude oil drillers generally transport to refineries by rail. But with a global oil glut that has driven down oil prices by nearly 50% in the past year, output from North Dakota’s Bakken Shale field dropped in both January and February. And the U.S. Energy Department has predicted the Bakken field as well as Eagle Ford, a shale-oil field in South Texas, would report production decreases for April and […]

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Chesapeake to Pay $25 Million to Settle Michigan Charges

Chesapeake Energy Corp. has agreed to pay $25 million to settle antitrust allegations made by Michigan’s attorney general, as well as complaints that it misled hundreds of landowners to obtain leases in the state. Michigan Attorney General Bill Schuette filed criminal charges against the company last year . He accused Chesapeake of colluding with Encana Corp., another oil and gas producer, to keep the price of natural gas leases in the state artificially low. In a separate case, Mr. Schuette’s office also filed racketeering and false pretenses charges against Chesapeake, saying the company had defrauded lease owners. Chesapeake has previously called the cases meritless. On Friday a spokesman said the Oklahoma City-based company was happy to have settled the matter. “We are pleased to have reached a mutually acceptable agreement with the Michigan Attorney General and to move past these legacy issues inherited from past management,” said Gordon Pennoyer, […]

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Western drought steals clean energy along with fresh water at power plants

INSIDE HOOVER DAM — The floor rumbled under Mark Cook. His legs vibrated as he stood in a tunnel tucked into the thick base of Hoover Dam, 430 feet below the tourists looking out over Lake Mead. Beneath him, water roared through steel pipes 13 feet tall. Nearby, heavy turbines hummed with mechanical intensity. “We’re moving some good water today,” Cook, the dam manager, said proudly. Moving water means making electricity. But the drought is making that harder to do. The lack of water has put a serious crimp in the hydroelectric line at Hoover Dam and other power plants across the West, limiting an inexpensive and pollution-free energy source that once was considered endless. Power capacity at Hoover Dam, on the Arizona-Nevada border, has dropped nearly 25 percent since 2000. In California, home to 287 hydroelectric plants and where almost half the state today is classified as being in […]

Posted On : Published By : Tom Whipple