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Oil Prices Extend Gains as Drilling Activity Drops Again

NEW YORK—Oil prices jumped Friday on an unexpectedly large drop in U.S. drilling activity. Oil producers have cut back sharply on capital spending and new drilling after surging U.S. shale-oil output helped push the global crude market into oversupply last year. As the number of rigs drilling for oil in the U.S. started falling in recent months, prices rallied on the expectation that U.S. oil output is due to slow. However, a drop in production has yet to show up in government data, and some analysts warned in recent weeks that the rig count was nearing a trough. With U.S. oil prices hovering around $60 a barrel, some shale producers say they are ready to add rigs and increase production, which could keep oil prices lower for longer. “People were thinking, ‘Oh, maybe we’ve bottomed,’” said Mark Anderle, director of supply and trading at TAC Energy. “This—even though on […]

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Oil gains 1 percent on U.S. inventory drop

LONDON Crude oil prices rose around 1 percent on Friday after U.S. inventories fell for a fourth straight week, although prices were set for a weekly drop on a stronger dollar. Oil saw steep falls earlier this week as a resurgent dollar weighed on the market amid concerns U.S. crude supplies may have started rising again after three weeks of draws. North Sea Brent crude has shed more than 3 percent this week, its second straight weekly loss, while U.S. crude is set to end a record weekly winning streak with a loss of more than 2 percent. July Brent LCOc1 was up 60 cents at $63.18 a barrel by 0820 GMT. U.S. crude CLc1, also known as West Texas Intermediate or WTI, was up 70 cents at $58.38. U.S. inventory data and wildfires in Canada, which knocked out 10 percent of its oil sands output, also supported prices. […]

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Rare run of oil finds is little respite for price-hit explorers

LONDON Exploration firms have made a rare run of oil and gas discoveries in recent weeks as more targeted search strategies bear fruit, but they offer little respite to a sector that remains severely bruised by the oil price slump. Global exploration and production (E&P) companies that scour frontier lands and seas in search of new energy reserves have had meagre success in recent years, putting many under pressure before a near halving of oil prices since last June. Seven successful discoveries with potential to become commercial have been made so far in 2015 by explorers ranging from independents such as Premier Oil to majors including ExxonMobil, according to Anish Kapadia, Managing Director, International Upstream Research at Tudor, Pickering Holt and Co (TPH) investment bank. Of the seven, all but one were made in the second quarter of the year. By contrast, Last year saw a total of 10 […]

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Natural Gas Losing Streak Hits Fifth Session

By Timothy Puko Natural gas prices fell Friday in a session that capped a five-day losing streak, as the market absorbed data that suggest a larger glut than expected. Prices for the front-month July contract lost 6.4 cents, or 2.4%, to $2.642 a million British thermal units on the New York Mercantile Exchange. The market is down 12% in a larger collapse since it closed at a four-month high on May 15. The decline was a sharp reversal for what had been a bull market after a three-week run earlier this month. Buyers don’t appear to be stepping in strongly even after big losing sessions, which analysts said is a sign the momentum is firmly pointed to trade lower. The rally "has run its course," said John Saucer, vice president of research and analysis at Mobius Risk Group in Houston. "We’ve been on the defensive ever since." Production is […]

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OPEC supply, resurgent shale seen keeping oil prices weak: Reuters poll

Oil prices are likely to stay relatively weak for the rest of this year due ample supply from traditional Middle East producers and a resurgence of U.S. shale production, a Reuters survey forecast on Friday. Reuters monthly survey of 28 analysts predicted the global oil benchmark North Sea Brent crude LCOc1 would average $61.60 a barrel in 2015, close to current levels. So far this year Brent has averaged close to $58 a barrel, down from almost $100 in 2014. The Organization of the Petroleum Exporting Countries (OPEC) is likely to decide at its meeting in Vienna next week to keep its joint production target unchanged at 30 million barrels per day (bpd) but maintain output above that level, analysts said. "That should keep a lid on prices," Carsten Fritsch, senior oil and commodities analyst at Commerzbank in Frankfurt, said. "The OPEC meeting will confirm the strategy of protecting […]

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U.S. oil contango vanishing as supply glut shifts abroad

The U.S. oil market is on the brink of returning to a more bullish footing known as backwardation for the first time in six months, with the discount for prompt supplies vanishing as a domestic supply glut eases. The discount for prompt U.S. oil futures versus the second-month contract – a structure known as "contango" that signals a weak market – narrowed to its smallest in five months on Friday as strong demand and flattening production added to expectations that domestic stockpiles will continue to fall over the summer. If that spread flips to a premium, known as "backwardation," it would come in sharp contrast to the global Brent futures, which is showing no signs of emerging from its 50-cent contango. On Thursday a prompt cargo of Forties crude, part of the European benchmark, traded at its lowest in 6-1/2 years. The prompt-month July contract for U.S. West Texas […]

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Insurgents advance in areas around captured Syrian town: monitor

BEIRUT Insurgents who captured the last government-held town in Syria’s Idlib province celebrated inside on Friday and made more advances in surrounding areas, in a further blow to the stretched army and allied militia. The "Army of Fatah" alliance which includes al Qaeda’s Syria wing Nusra Front, the Islamist Ahrar al-Sham group and other factions, captured Ariha town on Thursday night as the Syrian military pulled back. The army has lost large parts of the northwestern province to insurgents since late March, when the provincial capital fell to Army of Fatah, a name which refers to Islamic conquest. The recent advances have brought insurgents closer to the coastal Latakia province, President Bashar al-Assad’s ancestral homeland and an area of importance to his government. The army and allied militia have increasingly focused on defending Syria’s western flank which includes Latakia, Homs city and Damascus further south. By Friday the insurgents […]

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ISIS Claims Bombing at Saudi Shiite Mosque

JEDDAH, Saudi Arabia—Islamic State took responsibility for a Friday suicide bombing at a Shiite mosque in Saudi Arabia, the second time in one week that the Sunni militant group claimed an attack on the kingdom’s minority Shiites. In a statement posted online, it identified the attacker as Abu Jandal al-Jazrawy. The group’s Baghdad division also claimed midnight car bombings that targeted two of the Iraqi capital’s most exclusive hotels, killing three people and injuring 17, according to reports from an Iraqi official. Earlier reports by the Associated Press put the death toll at 15. Via a statement posted on Twitter and distributed by the SITE Intelligence Group, the extremists, who last claimed two May 3 bombings in the city, said the latest attacks were part of a planned series. Saudi Arabia’s interior ministry said at least four people were killed when security forces attempted to stop a suspicious car […]

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ISIS Claims Deadly Car Bombings at Baghdad Hotels

BAGHDAD — Car bombings struck two luxury hotels in Baghdad around midnight Thursday, amid the busy social swirl of the start of the weekend here. In total, 14 people were killed and 25 wounded, security official said. The bombings took place in the parking lots of the hotels, highlighting the ability of militants to maneuver around strict security measures. Foreigners frequently stay at the hotels.

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Divisions Remain as U.S., Iran Meet on Nuclear Deal

Major divisions remain between Iran and six world powers as U.S. Secretary of State John Kerry and Iranian Foreign Minister Javad Zarif prepare to meet in Geneva on Saturday, a month away from a deadline for a final nuclear deal. People involved in the talks warn that political pressures could still delay—or even derail—a deal as the two sides flesh out the broad agreement they reached on key issues in Lausanne on April 2. While much of the focus in the spring focused on the Obama administration’s struggles to prevent congressional opponents from blocking a deal, diplomats say it is growing political pressure in Iran that now poses the greatest risks. Among the toughest issues to resolve is one that has complicated diplomacy for years: access to Iranian scientists who worked on nuclear policy and to sites both to ensure Tehran doesn’t cheat on a deal and to answer […]

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Iran provides some information in UN nuclear inquiry

The U.N. nuclear watchdog said on Friday it had made incremental progress but no breakthrough in its inquiry into whether Iran may have researched an atom bomb, a sobering message that may dim chances for a deal between Tehran and big powers next month. Diplomats view Iran’s reluctance to open up to investigators from the International Atomic Energy Agency as a sign of its reluctance to cooperate fully until punitive sanctions imposed on it are lifted as part of any settlement with the powers. A confidential, quarterly report issued by the IAEA said the Islamic Republic had provided some information about one of two open items in the investigation into possible military dimensions to its nuclear energy program “The Agency and Iran agreed to continue the dialogue on these practical measures and to meet again in the near future,” said the report, which was obtained by Reuters. A diplomat […]

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Explosion Near Shiite Mosque Kills 4 in Eastern Saudi Arabia

Photo The site of an explosion near a Shiite mosque in Dammam, Saudi Arabia, on Friday. Credit Agence France-Presse — Getty Images BEIRUT, Lebanon — A suicide bomber dressed in women’s clothing detonated his explosive belt near the entrance to a Shiite mosque in eastern Saudi Arabia on Friday, killing three other people, according to Saudi state media. The Islamic State jihadist group claimed responsibility, as it did just a week ago for a similar attack in the same region. News reports said the bomber, who was dressed in the ample black abaya worn by Saudi women, blew himself up as security officers were approaching him. In a statement posted on Twitter, the Islamic State claimed responsibility for the attack, saying it had been carried out by “a soldier of the caliphate” named Abu Jandal al-Jazrawi, a nom de guerre. The attack occurred near Al Anoud mosque, in the […]

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Islamic State militants in Libya ‘seize Sirte airport’

Militias withdrew from al-Ghardabiya airbase, also a civilian airport, on Thursday (file picture) Islamic State militants in Libya say they have seized the airport in the city of Sirte, as the group continues to make advances in the country. The news was announced by the group and by a Libyan militia that withdrew from the coastal city’s airport on Thursday. Most of Sirte, former leader Muammar Gaddafi’s hometown, fell to IS last week. In a statement, the group said it had also seized the Great Man Made River water project. The irrigation project, the world’s largest, supplies fresh water to Libyan cities and was also the base for the opposition Battalion 166, which has now fled. The battalion, and other Islamist militias, run the capital, Tripoli, although their government is not recognised by the international community. The al-Ghardabiya airport also housed an airbase, that was seized by militias after […]

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China’s slowing economy may steady later this year: state think tank

SHANGHAI Short term policies could stabilize China’s slowing economy in the second half of this year, but for growth to make a lasting recovery Beijing should foster new sectors and innovation, a government think tank’s chief economist was reported as saying on Saturday. China’s growth trajectory will be "L" shaped, rather than "V" shaped, and it is difficult to predict when the world’s second-largest economy will rebound, Fan Jianping, chief economist at the State Information Centre, told the official China Securities Journal. Broad M2 money supply (M2) only rose 10.1 percent by the end of April from a year ago, missing market expectations of 12 percent, leaving significant room for continued loosening of monetary policy including lowering interest rates and relaxing the reserve requirement ratio (RRR), he added. China’s central bank has now cut interest rates and RRR five times in six months to stoke an economy that is […]

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Baker Hughes: US Oil Drillers Pull 13 Rigs, Biggest Drop in 4 Weeks

May 29 (Reuters) – Energy firms pulled another 13 rigs from U.S. oil fields this week, the biggest drop in four weeks, data showed on Friday, showing that a near six-month slump in activity had yet to run its course despite a rebound in crude oil prices. That was the 25th straight weekly decline, bringing the total rig count down to 646, the lowest since August 2010, oil services company Baker Hughes Inc said in its closely followed report. However, in the Eagle Ford basin in South Texas, the nation’s second biggest shale oil field, drillers added one oil rig in the third weekly increase in a row, bringing the total up to 90. The market has been eyeing the U.S. rig count and the increases of a few rigs in some basins over the past few weeks ahead of next week’s meeting of the Organization of the Petroleum […]

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BHI: US rig count declines 10 units, falls below nadir of 2008-09 downturn

The US drilling rig count dropped 10 units during the week ended May 29 to settle at 875 rigs working, falling below the nadir of the 2008-09 downturn by a single unit, according to data from Baker Hughes Inc. The rig count has now declined in 25 consecutive weeks, during which time it has plunged 1,045 units ( OGJ Online, Dec. 5, 2014 ). Compared with this week a year ago, the count is down 991 units. Although an uptick from the mere 3 units lost last week, the loss of 10 units represents the second-smallest decline of the 25-week period. Raymond James & Associates Inc.’s energy research team noted this week that most oil field services companies with which it speaks are saying “the bottom is in” for US drilling following last week’s rise in the US onshore count for the first time since last November. The analyst […]

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US Oil Production is Higher Than We Thought

When oil traders began obsessing earlier this year about U.S. crude production, analysts were quick to sound alarms . Market participants have been eager to discern whether the country’s oil output has peaked. Last year’s swoon in oil prices prompted companies to sharply cut spending, and new drilling for oil in the U.S. has plummeted. Traders began parsing U.S. Energy Information Administration reports for clues, and previously little-noticed week-to-week changes in production began moving the market. But analysts warned the market shouldn’t rely too heavily on the weekly figures, which are largely based on a forecasting model. Wait for the monthly reports, they said. But be wary of the monthly reports too, because they can and will be revised. Thursday offered a case in point. The first March data to be released showed average monthly U.S. crude production at 9.5 million barrels a day, the highest level since 1972 […]

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U.S. Oil-Rig Count Drops Again

The U.S. oil-rig count fell by 13 to 646 in the latest week, according to Baker Hughes Inc., marking the 25th straight week of declines. The drop marks an acceleration from last week when U.S. oil-rig count fell by one, which sparked speculation that the count was bottoming out. The number of U.S. oil drilling rigs–a proxy for activity in the oil industry–has fallen sharply since prices headed south last year. There are now about 60% fewer rigs working since a peak of 1,609 in October. Crude-oil futures gained 4.8% to $60.42 after the data release. Prices have shot up by around 40% in the past two months on expectations that U.S. oil production will slow. But the rally has sputtered recently, as U.S. prices have been unable to hold above $60 a barrel. Earlier this week, the latest U.S. inventory data had mixed news for the oil market. […]

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U.S. GDP Swings to Contraction in First Quarter

WASHINGTON—The U.S. economy contracted early this year as harsh weather and a strong dollar sapped demand for American goods, underscoring the choppiness of an expansion that has struggled to lift off. Gross domestic product, the broadest sum of goods and services produced across the economy, shrank at a 0.7% seasonally adjusted annual rate in the first quarter, the Commerce Department said Friday. The agency previously estimated output grew 0.2% from January through March. The revision, near economists’ expectation of a 1% contraction, showed how the world’s largest economy remains vulnerable to shocks as it struggles to regain its vigor. The dip, expected to be short-lived, marked the third quarterly contraction since the economy emerged from recession in mid-2009. “When you’re this weak, little things can knock you off course, whether it’s the Arab spring, the earthquake or ‘Snowmageddon,’ ” economist Dan Greenhaus of brokerage firm BTIG said. “We have […]

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Arctic drilling ‘will happen,’ Alaska’s governor says

Alaska’s governor tells his Washington state counterpart that Arctic drilling off the state coast "will happen." Photo courtesy of Emily Johnston/350 Seattle SEATTLE, May 29 (UPI) — After a tour of a Shell drilling rig in Seattle, Alaska Gov. Bill Walker said oil is the lifeblood of the state’s economy and arctic drilling "will happen." Walker toured the Polar Pioneer drilling rig parked at the Port of Seattle before meeting with Washington Gov. Jay Inslee to discuss Shell’s plans for the arctic waters off the Alaskan coast. "Responsible offshore drilling in the Arctic will have significant economic impacts in Alaska, and I am encouraged by the advancements I saw today," Walker said in a statement. Seattle Mayor Ed Murray expressed opposition to Shell’s lease for a port terminal for use for its drilling plans offshore Alaska. With federal approval in hand, Shell said it may start its drilling campaign […]

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Alaska LNG gets export nod

Federal government clears way for liquified natural gas exports from Alaskan mega-project to countries without a U.S. free-trade agreement. File Photo by Heather Snow/Shutterstock WASHINGTON, May 29 (UPI) — Alaskan lawmakers cheered a federal decision that clears the way to send liquefied natural gas from state ports to non-free trade markets in Asia. The U.S. Energy Department gave conditional consent for the Alaska LNG Project to ship LNG sourced from domestic reserves to countries that don’t have a free-trade deal with the United States. "Receiving the conditional license to export LNG to non-free trade agreement countries is a major milestone for the Alaska LNG project and great news for Alaska," U.S. Sen. Lisa Murkowski , chair of the Senate Energy Committee, said in a statement. The Republican senator’s office said Alaska has more than 35 trillion cubic feet of gas on hand on the North Slope. The LNG project, […]

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Gov. Wolf forms Pennsylvania gas pipeline system taskforce

Pennsylvania Gov. Tom Wolf (D) formed a Pipeline Infrastructure Task Force to help state agencies, natural gas producers, and communities closely work together as thousands of miles of pipelines are proposed to move gas and related products from wellheads to markets. The Pipeline Infrastructure Task Force (PITF) also will include representatives from the state legislature, federal and local governments, and environmental organizations, he said in announcing the group’s formation on May 27. “We need to work with the industry to make sure that the positive economic benefits of Pennsylvania’s rich natural resources can more quickly be realized in a responsible way,” Wolf said. “This taskforce is part of our commitment to seeing the natural gas industry succeed.” He named John Quigley, the Pennsylvania Department of Environmental Protection’s acting secretary, chairman of PITF. “Over the next decade, we could see the construction of as many as 25,000 miles of gathering […]

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EPA proposes renewable fuel quotas for 2014, 2015, and 2016

The US Environmental Protection Agency proposed renewable fuel quotas for 2014 that it said reflect the year’s actual biofuel use, and for 2015 and 2016 and, for biodiesel, quotas through 2017 that increase steadily over time. It proposed using authority granted by Congress to reduce quotas below federal Renewable Fuel Standard (RFS) levels established under the 2007 Energy Independence and Security Act (EISA). The proposal’s steadily increasing volumes indicate that biofuels remain an important part of the nation’s strategy to improve energy security and address climate change, it said. Under the notice of proposed rulemaking , which Administrator Gina McCarthy signed on May 29, EPA proposed adjustments to advanced biofuel and total renewable fuel targets for all 3 years. The proposed quotas for 2015 and 2016 “are expected to spur further progress in overcoming current constraints in renewable fuel distribution infrastructure, which in turn is expected to lead to […]

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Exxon CEO Mocks Renewable Energy

The CEO of one of the world’s largest oil companies downplayed the effects of climate change at his company’s annual meeting Wednesday, telling shareholders his firm hadn’t invested in renewable energy because “We choose not to lose money on purpose.” “Mankind has this enormous capacity to deal with adversity,” ExxonMobil CEO Rex Tillerson told the meeting, pointing to technologies that can combat inclement weather “that may or may not be induced by climate change.” The comments, which met with applause, were first reported by The Associated Press. At the meeting, shareholders sided with the company’s board and voted against a measure proposed by Father Michael Crosby and Sister Pat Daly, representatives of a Milwaukee-based Roman Catholic organization, to add a climate change expert to the company’s board. In a letter to shareholders, Tillerson and his colleagues wrote that “to set aside one seat for an environmental specialist or for […]

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Russia calls on oil producers not to boost output – local media

MOSCOW Russia is calling on oil producers around the world to refrain from increasing output, Energy Minister Alexander Novak said on Friday, according to Russian news agencies, just days before he is due to meet officials from OPEC. The Russian economy has been hit hard by lower oil prices, which have almost halved from a peak in June last year of $115 per barrel. Oil and gas sales account for around half or Russia’s state budget revenues. "We call for all countries to keep their output unchanged," Novak was quoted as saying by TASS news agency. Several other local media outlets also reported his call to global oil producers. The Russian minister is due to hold talks with some officials from the Organization of the Petroleum Exporting Countries (OPEC) next month in Vienna, just before the group’s meeting on Jun.5. Russia is not a member of OPEC, and Novak […]

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Is The Oil Glut Real?

As it appears GDP will be seasonally adjusted again, I find myself wondering just one thing: why? Earlier GDP figures showed the US economy on the brink of recession for the first two quarters of this year. Now, with more fudging going on, who knows what it will show. The government appears to be following the Hollywood mantra: if you can bend perception enough, it will become reality. Look no further than the Federal Reserve, which continues to raise expectations of higher interest rates in the second half of this year, in hopes of inducing faster growth. Of course, the age of propaganda is now upon us; where perception trumps the truth, until that is, the house of cards burns and falls, which it always does. The US consumer responded to lower gas prices not by spending but by saving, despite predictions from investment banks and the Fed. They […]

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Oil gains 1 percent on U.S. inventory drop

LONDON Crude oil prices rose around 1 percent on Friday after U.S. inventories fell for a fourth straight week, although prices were set for a weekly drop on a stronger dollar. Oil saw steep falls earlier this week as a resurgent dollar weighed on the market amid concerns U.S. crude supplies may have started rising again after three weeks of draws. North Sea Brent crude has shed more than 3 percent this week, its second straight weekly loss, while U.S. crude is set to end a record weekly winning streak with a loss of more than 2 percent. July Brent LCOc1 was up 60 cents at $63.18 a barrel by 0820 GMT. U.S. crude CLc1, also known as West Texas Intermediate or WTI, was up 70 cents at $58.38. U.S. inventory data and wildfires in Canada, which knocked out 10 percent of its oil sands output, also supported prices. […]

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U.S. Oil Prices Pare Losses on Supply Drop

By Nicole Friedman NEW YORK–U.S. oil prices pared losses but stayed lower Thursday after weekly inventory data showed a drop in crude supplies but an unexpectedly large increase in production. Light, sweet oil for July delivery recently fell 16 cents, or 0.3%, to $57.35 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, traded up 40 cents, or 0.6%, at $62.46 a barrel on ICE Futures Europe. U.S. commercial crude-oil supplies fell by 2.8 million barrels in the week ended May 22, the U.S. Energy Information Administration said. Analysts surveyed by The Wall Street Journal had expected a drop of 1.1 million barrels. The EIA also reported that U.S. crude-oil production rose by 304,000 barrels a day last week to 9.57 million barrels a day, the highest level in weekly data going back to 1983. In monthly data, which don’t exactly line up with weekly data, […]

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The Tanker Market Is Sending a Big Warning to Oil Bulls

Four months into oil’s rebound from a six-year low, the tanker market is sending a clear signal that the rally is under threat. A sudden surge in demand for supertankers drove benchmark charter rates 57 percent higher in the two weeks through May 20. OPEC will have almost half a billion barrels of oil in transit to buyers at the start of June, the most this year, while analysts say about 20 million barrels is being stored on ships in another indication the glut has yet to dissipate. The Organization of Petroleum Exporting Countries is pumping the most oil in more than two years, determined to defend market share rather than prices. A record cut to the number of active U.S. drilling rigs and billions of dollars of spending reductions by companies since last year’s price plunge has yet to translate into a slump in barrels produced. The world […]

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Natural Gas Futures Slide as Supplies Jump

By Christian Berthelsen Natural gas futures suffered their largest one-day drop in more than two months on Thursday as U.S. inventory data showed supplies rose more than expected last week. The natural gas market had been chugging higher earlier in May as above-normal spring temperatures fueled expectations of higher demand for gas-fired generation to power air conditioning. But Thursday’s data showed that even elevated demand wasn’t enough to overcome surging gas production from U.S. shale formations. The U.S. Energy Information Administration said national gas stockpiles rose 112 billion cubic feet in the week ended May 22, compared with the 99 bcf rise projected in a consensus estimate of analysts surveyed by The Wall Street Journal. The increase brought total stored supplies to 2.1 trillion cubic feet, less than 1% below average for this time of year, as the market has almost fully recovered from the severe drawdown to power […]

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NYMEX July natural gas futures settle at $2.706/MMBtu, down 14.1 cents

On its first day as the prompt month, the NYMEX July natural gas futures contract slid 14.1 cents to settle at $2.706/MMBtu on Thursday, as the market reacted to government data that showed a build to storage stocks well above expectations. US natural gas in storage rose 112 Bcf to 2.101 Tcf in the week ended May 22, the Energy Information Administration said Thursday, well above consensus expectations of an injection of 97-101 Bcf. "This action we saw today comes after a much larger-than-expected build," said Gene McGillian, senior analyst at Tradition Energy. "It really points out the market’s vulnerability when pushing above that $3[/MMBtu] level." McGillian, who has argued before that market fundamentals did not support levels above $3/MMBtu, noted that production growth continues to surprise. Despite a sharply lower rig count, "the market is showing that we still have a lot of gas coming out of the […]

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OPEC Output Target Seconded by Libya as Ministers Head to Vienna

OPEC will maintain its production target next week, Libya’s deputy vice prime minister said, joining Kuwait in predicting no policy change when oil ministers from the 12-member group meet in Vienna next week. The output target will remain 30 million barrels a day, Mohammad Oun, Libya’s deputy vice prime minister for energy, said by phone from al-Bayda, eastern Libya. Oun will be part of Libya’s delegation to the June 5 meeting. OPEC is working on a long-term strategy draft to present next week that is likely to show projections of crude supply from non-OPEC producers are the same as those forecast in 2014, he said. “The target number will not change,” Oun said. Libya is pumping 400,000 barrels of oil a day, state-run National Oil Corp. spokesman Mohamed Elharari said in a phone interview Thursday. That makes Libya the smallest producer in OPEC. The Organization of Petroleum Exporting Countries […]

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Medical Need Climbs Alongside Death Toll in Yemen

Photo Yemenis were taken to a hospital after they were wounded during shelling Wednesday in Taez. Credit Abdel Rahman Abdallah/Agence France-Presse — Getty Images SANA, Yemen — Airstrikes by a Saudi-led military coalition were said to have killed at least 80 people in Yemen on Wednesday, and the World Health Organization warned that roughly one-third of the country’s population was in urgent need of medical care. The airstrikes hit a military base in a densely populated neighborhood here in the capital and areas near the Saudi border. Health officials said those killed included dozens of civilians, as well as fighters loyal to the Houthi rebel movement. The death toll, which could not be independently confirmed, appeared to be one of the highest in a single day since Saudi Arabia launched its air war against the Houthis in late March, with the stated goal of returning Yemen’s exiled government to […]

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Protesters target West Qurna 2 for security jobs

Workers operate a drilling rig at the West Qurna 2 oil field in Basra. (ALI ABU IRAQ/Iraq Oil Report/Metrography) About 150 local residents temporarily shut down access to Iraq’s super-giant West Qurna 2 oil field this week, protesting that they had not been given jobs protecting the project.The unarmed protesters dispersed peacefully on Tuesday after blocking access roads for the previous two days. Several workers at the field said nobody was able to enter or leave the facility, but production was not affected."We were supposed to go back to our families this afternoon, but protesters blocked the r… This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

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DNO ready to spend in Iraq

Swedish energy company DNO said it plans to review spending plans in Kurdish north of Iraq as business climate improves. Logo courtesy: DNO OSLO, Norway, May 28 (UPI) — Norwegian energy company DNO said Thursday it plans to invest more on its assets in the Kurdish north of Iraq as the business cycle improves. "We are ramping up production, export and local sales following the recently completed Tawke capacity expansion," Executive Chairman Bijan Mossavar-Rahmani said in a statement. "We will dust off investment plans as our revenue stream continues to grow." DNO in a quarterly statement early this month said weak sales to the Kurdish market and the low price of oil forced it to cut capital spending on the back of reduced revenues. For first quarter 2015, production from the DNO-operated Tawke field in the north of Iraq was 104,925 barrels of oil per day, of which about […]

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Oil Crunch, Islamist War, Power Cuts Face New Nigeria Leader

Nigerians queue to buy fuel at Mobil filling station in Abuja. Photographer: Stringer/Anadolu Agency/Getty Images Crippling fuel shortages, power cuts, slowing economic growth and Islamist militants wreaking havoc. Muhammadu Buhari is taking on a tough job when he’s sworn in as Nigeria’s president on Friday. Former military ruler Buhari, 72, swept incumbent Goodluck Jonathan from office in March elections by pledging to end endemic corruption and Boko Haram’s rebellion in the north. His stewardship of Africa’s biggest oil producer, this time as elected president, may depend on the price of crude, which supplies the government with more than two-thirds of its income. “If you look at expectation and look at funding, there’s quite a gap,” Olusegun Sotola, a research fellow at the Lagos-based Initiative for Public Policy Analysis, said by phone. “Buhari is going to be running a government without the necessary funding, which is a big problem because […]

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Nigeria: Why Fuel Subsidy Must Go (II)

Lagos — As the world awaits the inauguration of Muhammadu Buhari as the President of Nigeria, controversy over the contentious fuel subsidy claims has taken a centre stage following the fuel scarcity that almost brought the country to its knees. This is coming as the Federal Government is said to have spent more than N6 trillion from 2006 to 2014 on fuel subsidies. Vanguard can now reveal the amount spent on subsidy since 2006. The table below shows the amount spent on subsidy from 2006: *2006 – N151.9 billion; *2007- N188 billion; *2008 – N256.3billion (January to July); *2009 – N421.5billion; *2010 – N673 billion; *2011 – (N1.3 trillion)revised to N2.19 trillion; *2012 – N888 billion + N161.6 billion supplementary *2013 – N971 billion; and, *2014 – N971.1 billion Although figures are now being bandied about by respective groups, but former President Olusegun Obasanjo reintroduced subsidy on fuel as […]

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Venezuela, Russia’s Rosneft agree on $14 billion oil, gas investment

CARACAS Venezuela and Russia’s top oil producer, Rosneft, have agreed on around $14 billion in investment in the South American OPEC country’s oil and gas sector, President Nicolas Maduro said on Wednesday evening. Maduro said he met with the chief executive of state-owned Rosneft, Igor Sechin, earlier on Wednesday, in the company of PDVSA [PDVSA.UL] President Eulogio del Pino and National Assembly boss and Socialist Party No. 2 Diosdado Cabello. "We had a great meeting and agreed on investment of over $14 billion," said Maduro during a televised broadcast, adding the funds would go toward doubling Venezuela’s oil production. PDVSA has formal ambitious targets to double national production to 6 million barrels a day by 2019, with 4 million of that projected to come from the Orinoco Belt, but few industry experts or foreign investors expect those goals to be met. Speaking at a Socialist Party event broadcast on […]

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Saudi Arabia goes on refinery hiring spree in South Korea

SEOUL/KHOBAR, Saudi Arabia Saudi Arabia’s state oil firm is on a hiring spree in South Korea, as the world’s top crude exporter seeks engineers to run plants in its soaring refining sector – setting it on course to compete with some Asian countries that are big oil buyers. Technicians from South Korea are an obvious target given parts of its refining sector are struggling and the two countries also have long-established business ties across a range of areas including refining. But Asia has established itself as the world’s biggest refining region and so Saudi moves to become a major refiner are set to increase competition with countries such as India that also refine Saudi crude to supply Europe. Having little prior experience in refining, state oil firm Saudi Aramco is trying to lure experienced engineers and technicians from South Korea with generous expatriate packages. "Working in Aramco has three […]

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US oil production hits 43-year high

An oil well owned an operated by Apache Corporation in the Permian Basin is shown in Garden City, Texas, Feb. 5, 2015. The Organization of the Petroleum Exporting Countries has adopted a market-based pricing strategy that it hoped would shake out high cost producers. One such high cost producer is the U.S. shale industry, which dramatically boosted world production in recent years. While U.S. rigs are now down more than 50 percent from last year, analysts and traders have speculated that the rigs coming off line are those that were already declining in production and that the robust rigs are still operating. In addition, many investors believed that lower prices would squeeze U.S. shale producers to produce less, but the data show otherwise. Analysts say the high level of production shows that the U.S. industry continues to be resilient and continues to find efficiencies in the system. “As the […]

Posted On : Published By : Tom Whipple
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Section of Pipe in California Oil Spill Removed

Volunteers clean up the oil spill at Haskell’s Beach in Goleta, Calif., on Wednesday. Workers on Thursday removed a section of a crude-oil pipeline that ruptured and spilled more than 100,000 gallons of oil off the Santa Barbara County, Calif., coast last week. The piece of pipe will be sent to an independent laboratory in Ohio to determine what caused it to fail, according to a spokeswoman for the federal Pipeline and Hazardous Materials Safety Administration. The agency ordered and supervised the removal and will station an inspector at the lab to observe the metallurgical testing. The pipeline will be shipped in two segments—one 19 feet long and the other 31 feet long, said PHMSA spokeswoman Artealia Gilliard, adding that the amount of time it takes to conduct the tests and analysis can vary. “There’s no definite timeline,” she said. She declined to provide details on the condition of […]

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U.S. economy likely shrank in first quarter, but fundamentals strong

WASHINGTON The U.S. economy likely contracted in the first quarter as it buckled under the weight of unusually heavy snowfalls and a resurgent dollar, but activity since has rebounded modestly. The government is expected to report on Friday that gross domestic product shrank at a 0.8 percent annual rate instead of growing at the 0.2 percent pace it estimated last month, according to a Reuters survey of economists. A larger trade deficit and a smaller accumulation of inventories by businesses than previously thought will probably account for much of the expected downward revision. With growth estimates so far for the second quarter around 2 percent, the economy appears poised for its worst first half performance since 2011. Economists, however, caution against reading too much into the expected slump in output. They argue the GDP figure for the first quarter was held down by a confluence of temporary factors, including […]

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Alberta Wildfires Burn For 6th Day, 10% Of Oil Sands Crude Offline

CALGARY, Alberta, May 28 (Reuters) – Firefighters battled wildfires in northern Alberta, Canada’s biggest crude-producing region , for a sixth day on Thursday, with two blazes near oil sands facilities still out of control. The wildfires have forced producers in the Western Canadian province, the largest source of U.S. crude imports, to shut in 233,000 barrels per day of crude production, around 10 percent of total oil sands output. The biggest fire, on the Canadian military’s Cold Lake Air Weapons Range, had grown in size to 20,000 hectares (49,000 acres) from 17,000 hectares on Wednesday. That blaze has forced Cenovus Energy Inc and Canadian Natural Resources Ltd to shut down production and evacuate staff from their Foster Creek and Primrose oil sands projects. Janelle Lane, a wildfire information officer at the Alberta government, said the fire had advanced to roughly 15 kilometres (9.3 miles) away from Cenovus’s Foster Creek […]

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Big US Shale Field Marcellus Faces Output Drop Due To Low Gas Prices

May 28 (Reuters) – Natural gas production in the Marcellus shale, which has grown over the past decade from next to nothing to the source of about a fifth of U.S. output, may decline for the first time if prices in the basin remain low for much longer, according to federal government data. Such a reduction may be worrisome since the United States is counting on the Marcellus to continue producing vast amounts of cheap gas needed to meet growing demand from industrial customers and power generators, and to enable the country to transition into a net gas exporter by 2017. The U.S. Energy Information Administration says production in the fast-growing field in Pennsylvania and West Virginia is set to remain flat for the next few years before beginning a very slow decline primarily because of depressed gas prices. Recent data supports signs of a slowdown. The number of […]

Posted On : Published By : Tom Whipple
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Will Homeowners Shell Out Thousands for Super Batteries?

Billionaire entrepreneur Elon Musk sees a future in which super batteries change the world , making solar power available at night and turning homes into tiny utilities. Kellie Haynes, an event planner in Sacramento, Calif., is one of the few Americans who already lives in that world. She says she loves the benefits but didn’t have to cover all the costs. Whether people are willing to pay thousands of dollars apiece to join her remains one of the biggest questions hanging over Mr. Musk’s Tesla Motors Inc. TSLA 1.62 % and other companies jumping into the budding business of electricity-storage batteries. Ms. Haynes lives in a year-old house with solar panels and a battery system that cost her nothing—the $25,000 system designed by San Francisco company Sunverge Energy Inc. was covered by government subsidies and utility incentives , according to developer Pacific Housing Inc. that built her 34-house neighborhood […]

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Sodden Spring Eases Texas’ Yearslong Drought

DALLAS—This week’s devastating Texas floods capped an exceptionally wet spring for the Lone Star State that has effectively ended its yearslong drought. Eighty-two percent of Texas was drought-free as of May 26, up from just 11% a year earlier, according to U.S. Drought Monitor estimates released by the government Thursday. None of the state remained in severe drought. May is already the wettest month in recorded Texas history, averaging 7.54 inches of rain, beating the record of 6.66 inches set in June 2004, according to state climatologist John Nielsen-Gammon, a professor of atmospheric sciences at Texas A&M University. Some counties north of the Dallas-Fort Worth metro area have received more than 20 inches. Formerly shrunken lakes and reservoirs are brimming with water—to the point where the U.S. Army Corps of Engineers was strategically releasing water from many to reduce flooding, even before this week’s torrential rains. And the rainy […]

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Continental Resources Aggressively Cuts Costs

Continental Resources: 2015 Q1 Continental Resources announces first quarter results that highlights increases in production and reduced costs. In a press release on May 6th, Continental reported a net loss of $132.0 million for the first quarter of 2015 and a production increase to 206,829 boed. Most impressive is the company’s drilling and completion costs , which fell by 15% since 2014 year end. The company expects to see service cost reductions of up to 20% by mid-year and further savings from drilling and completion efficiencies. One example of these efficiencies is the new company record for drilling in the Bakken as they report drilling the two-mile lateral portion of a well in three days, nearly four days faster than its average time to drill a lateral. Bakken Highlights for First Quarter Production averaged 135,538 Boe per day (39% increase over first quarter 2014) Completed 66 net wells Operated an […]

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Chevron shareholders vote for political spending

SAN RAMON, Calif., May 28 (UPI) — Chevron’s top executive said the company would vet the shoot down of proposals to spend less on political maneuvering and more on environmental issues. Chevron stockholders voted on 13 items , with just under half of them tied in part to political or environmental issues. More than 70 percent of the shareholders voted against reports on lobbying and nearly all of them voted against an end to using corporate funds for political purposes. On environmental issues, 91 percent voted against a proposal to cut greenhouse gas emissions and 80 percent voted against a move to consider an independent director with environmental expertise. "The board will consider the final voting results carefully," Chairman John Watson said in a statement. Chevron has pressed for expanded options for exports of natural gas produced from domestic U.S. resources. A special permit is required to send liquefied […]

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EPA issues clean-up order for California oil spill

Workers continue the cleanup along Refugio Beach as efforts continue to remove the oil that has spilled an estimated 100,000 gallons off the Santa Barbara County coast in Goleta, Calif. on May 22, 2015. A unified command center established for the spill said the worst-case estimate is that 2,500 barrels of oil was released from a pipeline operated by Plains All American. Photo by Jim Ruymen/UPI | License Photo SANTA BARBARA, Calif., May 28 (UPI) — The U.S. federal government issued an order to Plains All American Pipeline to ensure the California coastline is restored after last week’s oil spill. As much as 2,500 barrels of oil was released from Line 901 in Santa Barbara last week, a pipeline owned and operated by Plains All American. About 500 barrels may have reached the waters off the coast of Refugio State Beach in a release the Environmental Protection Agency said […]

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Frac sand industry booming

USGS studies find the United States holds big lead in use of frac sands, with most of the minerals coming from western Great Lakes states. Map courtesy of the U.S. Geological Survey WASHINGTON, May 28 (UPI) — While the shale phenomenon may be spreading, a U.S. Geological Survey report finds the United States will continue to lead in the use of sand for fracking. Natural sand grains are mixed into hydraulic fracturing fluids to prop open fractures in underground shale deposits to release trapped oil and natural gas. Advances in hydraulic fracturing, known also as fracking, has put the United States, and Canada to a certain extent, in leadership positions in terms of oil and natural gas production. The North American frac-sand market is a $2.2 billion industry and is expected to expand by as much as 8.9 percent each year through 2016. The United States by next year […]

Posted On : Published By : Tom Whipple