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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 […]

Posted On : Published By : Tom Whipple
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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 […]

Posted On : Published By : Tom Whipple