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China upbeat on gasoline demand as gas guzzlers become popular

The Chinese bought nearly 49% more gasoline-guzzling sports utility vehicles, or SUVs, in the first quarter of 2015 compared with Q1 2014 — a statistic that is expected to support China’s gasoline demand growth. According to data from the China Association of Automobile Manufacturers, sales of multi-purpose vehicles, or MPVs, rose by 19.3% year on year in Q1. The trend of strong sales growth in these gasoline guzzlers more than offset the adverse impact on gasoline demand due to overall slowdown in vehicle sales growth in China. According to CAAM, total vehicle sales rose just 4% year on year in Q1 compared with 9% a year earlier. In a research note covering state-owned PetroChina published April 29, Nomura Research said the increasing popularity of SUVs in China could translate into higher-than-expected gasoline sales. "Although fuel efficiency is increasing, SUVs in general can burn 20% more fuel versus lighter sedans […]

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U.S. private payrolls growth eases; productivity falls

WASHINGTON (Reuters) – U.S. private employers in April hired the fewest number of workers in more than a year, further diminishing hopes of a strong rebound in economic growth after the first-quarter slump. The tepid private job gains combined with other data on Wednesday showing a second straight quarterly decline in productivity make it less likely the U.S. Federal Reserve will raise interest rates in June as had been expected at the start of the year. "The data pile onto recent evidence suggesting increased odds that, by the time the June policy meeting rolls around, the hope of a great spring rebound in real growth will have faded," said Steve Blitz, chief economist at ITG Investment Research in New York. Private payrolls increased 169,000 last month, the smallest gain since January 2014, the ADP National Employment Report showed. That was well below economists’ expectations for an increase of 200,000 […]

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Oil train derailment prompts evacuation in North Dakota town

AP Photo BISMARCK, N.D. (AP) — An oil train derailed and caught fire early Wednesday in a rural area of central North Dakota, prompting the evacuation of a nearby town where about 20 people live. No injuries were reported in the accident about 7:30 a.m. near Heimdal, about 115 miles northeast of Bismarck. Ten tanker cars on the BNSF Railway train caught fire, creating thick black smoke, state Emergency Services spokeswoman Cecily Fong said. Firefighters from four area communities responded, and regional hazardous materials teams from Grand Forks and Devils Lake went to the scene, Fong said. Ten investigators from the Federal Railroad Administration were traveling to the area, said spokesman Kevin Thompson. The National Transportation Safety Board also was sending a team. The Environmental Protection Agency was sending someone to gauge any contamination to waterways in the vicinity, spokesman Rich Mylott said. The rail line through Heimdal runs […]

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Crude oil train derails in North Dakota

Small town in central North Dakota evacuated after train carrying crude oil derails. Image: Google Maps HEIMDAL, N.D., May 6 (UPI) — Federal regulators said Wednesday a North Dakota town was evacuated after several tank cars carrying crude oil derailed and caught fire. Ten responders from the Federal Railroad Administration were dispatched to Heimdal, N.D., to investigate the cause of the incident. The small town of less than 50 residents in central North Dakota was evacuated as a security precaution. "Today’s incident is yet another reminder of why we issued a significant, comprehensive rule aimed at improving the safe transport of high hazard flammable liquids," acting Federal Railroad Administrator Sarah Feinberg said in a statement. "The FRA will continue to look at all options available to us to improve safety and mitigate risks." Cecily Fong, a spokeswoman for the North Dakota State Emergency Services, said in a telephone interview […]

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Oxy output boosted by Permian shale

Occidental Petroleum boosts production forecast after showing an increase in the first quarter, largely from Texas shale deposits UPI/Gary C. Caskey HOUSTON, May 6 (UPI) — Occidental Petroleum said Wednesday first quarter production was up 13 percent year-on-year in part because of output from the Permian shale in Texas. Occidental, known by its ticker symbol Oxy, said first quarter production rose year-on-year by 72,000 barrels of oil equivalent. "The increase was led by Permian resources which delivered a 46-percent increase to 98,000 boe per day, of which oil production grew by 25,000 barrels a day," President and Chief Executive Officer Stephen Chazen said in a statement Texas is the No. 1 oil producer in the nation. The Railroad Commission of Texas, the state’s energy regulator, said preliminary data from February show crude oil production averaged 2.34 million barrels per day. That’s an increase of 5.2 percent , or 117,550 […]

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Chesapeake Energy Swings to Loss on Write-Down

ENLARGE A worker walks past equipment at a Chesapeake Energy hydraulic fracturing operation near Carrizo Springs, Texas. Photo: John Davenport/San Antonio Express-News/Zuma Press Chesapeake Energy Corp. CHK -7.82 % swung to a heavy loss in the first quarter as the U.S. shale driller took a $3.6 billion write-down on some properties amid tumbling oil and natural gas prices. Excluding the impairment and other special charges, profit came in above expectations. Earlier this year, Chesapeake announced plans to reduce its rig operations to their lowest level since 2004 amid falling crude-oil and natural gas prices. It said it would reduce capital expenditures by 37% and drop the number of rigs drilling for new oil and gas finds by about 38%. Chesapeake has struggled to recover from years of aggressive spending as the land-grab approach the company pioneered for oil and gas drilling meant it spent more than its wells generated […]

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What the Future of Oil Drilling Will Look Like

Much development in the Bakken Shale has been chaotic. Liberty is aiming for a more methodical approach. Photo: Karen Bleier/AFP/Getty Images TIOGA, N.D.—The future of the U.S. oil industry may well be taking shape north of this town on 15 square miles of windswept prairie above the Bakken Shale. It’s about as far from the industry’s wildcatting heritage as is thinkable. “Our idea was to build the world’s greatest oil factory,” says Chris Wright, the chief executive of Liberty Resources LLC. And if the U.S. oil industry is going to overcome several significant challenges, it may have to follow the lead of this small Denver-based company. The U.S. oil industry boomed when crude oil prices were high, but has entered a world where low oil prices may be the norm for a while. Saudi Arabia says it won’t cut production to reduce supply, leaving U.S. companies vulnerable. After years […]

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Schumer bill would phase out older rail tank cars within 2 years

WASHINGTON, DC, May 6 US Sen. Charles E. Schumer (D-NY) said he would introduce legislation requiring US railroads to replace tank cars carrying crude oil and other hazardous substances more quickly than new US Department of Transportation rules require. His announcement came 2 days after US and Canadian railway transportation regulators jointly announced the regulations ( OGJ Online, May 1, 2015 ). The regulations are a step in the right direction, but do not go far enough, Schumer said during a May 4 appearance in Menands, NY. Specifically, he said DOT’s new rules DOT-111 tank cars and their Canadian CPC-1232 tank cars to remain in service through 2023. His measure would require them to be gone within 2 years, he noted. “Allowing these outdated oil cars to continue rolling through our communities for another 8 years is a reckless gamble that we can’t afford to make,” Schumer said. Railroads […]

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California approves first statewide seawater desalination rules

SACRAMENTO, Calif. (Reuters) – California regulators on Wednesday adopted the first statewide rules for the permitting of seawater desalination projects that are expected to proliferate as drought-stricken communities increasingly turn to the ocean to supplement their drinking supplies. The action, which sets uniform standards for minimizing harm to marine life, was welcomed by developers of the state’s two largest desalination projects as bringing much-needed certainty and clarity to the regulatory approval process. "It reaffirms that the Pacific Ocean is part of the drinking water resources for the state of California," Poseidon Water executive Scott Maloni told Reuters after the rule was enacted on a voice vote in Sacramento by the State Water Resources Control Board. The measure leaves the permitting process in the hands of the state’s regional water boards while establishing a single framework for them to follow in evaluating applications to build seawater treatment plants, expand existing […]

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Gas prices or economy, experts disagree on what drives U.S. demand

NEW YORK (Reuters) – Americans hit the road in record numbers this winter, reigniting a long debate that may determine whether global oil markets hold steady or tumble anew. But many economists and academics are split on whether prices matter when it comes to gasoline demand. On the face of it, the answer seems obvious. The over 40 percent slide in nationwide gas prices last year to nearly $2 a gallon led to more frequent and longer drives, fuelling a 5 percent jump in gas use in December and January, the fastest such growth in 11 years, according to U.S. government data. Yet many energy economists have long argued that it is economic activity and employment, not prices, that hold the greatest sway over how much gas Americans burn each day. "More jobs means more commuters,” says Phillip Verleger, president of consultancy PKVerleger and energy economist. However, some academics […]

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Exclusive: Hess-owned oil railcars involved in North Dakota derailment

WILLISTON, N.D. (Reuters) – A BNSF train that derailed in central North Dakota on Wednesday was carrying railcars owned by Hess Corp, 10 of which caught fire and forced the evacuation of a nearby town, the oil producer told Reuters late Wednesday. Emergency crews worked into the night to extinguish the fire. No one was injured. Hess, the third-largest North Dakota oil producer, said BNSF is leading cleanup efforts but added it stands ready to assist. The New York-based company said it is "fully compliant" with new North Dakota crude-treatment standards that went into effect last month. The standards, designed to mitigate the incendiary effect of crude-by-rail disasters, require combustible elements be filtered out of crude oil. It remains unclear whether the new standards helped reduce the fire caused by the derailment, but politicians, first responders and other witnesses described a subdued scene. "The scene is very anticlimactic and […]

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Tesla’s New Battery Doesn’t Work That Well With Solar

Tesla Chief Executive Elon Musk  introduced a new family of batteries designed to stretch the solar-power revolution into its next phase. There’s just one problem: Tesla’s new battery doesn’t work well with rooftop solar—at least not yet. Even Solar City, the supplier led by Musk, isn’t ready to offer Tesla’s battery for daily use. The new Tesla Powerwall home batteries come in two sizes—seven and 10 kilowatt hours (kWh)—but the differences extend beyond capacity to the chemistry of the batteries. The 7kWh version is made for daily use, while its larger counterpart is only intended to be used as occasional backup when the electricity goes out. The bigger Tesla battery isn’t designed to go through more than about 50 charging cycles a year, according to SolarCity spokesman Jonathan Bass. Telsa CEO Elon Musk points at the sun. Here’s where things get interesting. SolarCity, with Musk as its chairman, has decided not to install the 7kWh Powerwall that’s optimized […]

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Transocean Swings to a Loss on $881 Million in Charges

Transocean Ltd. RIGN -1.13 % posted a first-quarter loss as the offshore oil driller logged more than $800 million in charges related to the downsizing of its fleet in response to lower crude prices. Last quarter, Transocean logged a $992 million charge to correct the value of its contract drilling business, using up its remaining goodwill. On Wednesday, the company said it was recording a $481 million impairment from its Deepwater Floater asset group and $393 million in impairments of assets classified as held for sale. In 2014, Transocean recognized a loss of $788 million from the impairment of its Deepwater Floater asset group and a loss of $227 million, or $179 million after taxes, from scrapping a number of floaters and related equipment. The Switzerland-based company, which boasts the world’s largest fleet of offshore drilling rigs, spent billions of dollars to expand its fleet right before oil prices […]

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Oil Slump Drives Election Upset in Canadian Province

ENLARGE Alberta NDP leader Rachel Notley vowed in her victory speech Tuesday to put an end to the ‘boom-and-bust roller coaster’ of tying provincial finances to the fortunes of its oil patch. Photo: dan riedlhuber/Reuters CALGARY—The long-serving center-right government of Canada’s oil-rich Alberta province became the first major Election Day casualty of slumping global oil prices, as a left-leaning government swept to power in a vote that shocked Canada’s political establishment. Alberta’s Progressive Conservative Party, which has governed the western Canadian province since 1971—the longest-serving governing party in Canadian history—fell to a distant third place in Tuesday’s election, behind the leftist majority and a resurgent right-wing opposition party. The upset by the New Democratic Party threatens to slow investment and development in Alberta’s oil patch if companies dial back in anticipation of new regulatory hurdles or costs. Alberta’s once-roaring economy has already ground to a virtual standstill, with real […]

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Hampton Roads April coal exports down 37.2% from year ago

Coal exports from terminals in Virginia’s Hampton Roads region totaled 2.5 million st in April, down 28.3% from March and 37.2% lower than the year-ago month, data from the Virginia Maritime Association showed Wednesday. The association does not comment on its monthly figures, but low seaborne prices are likely behind the dip in exports. Discounting February’s export total of 2 million st, which was affected by loading delays due to bad weather, the April figure is the lowest since November 2010. April’s figures also show a weak comparison to March loadings, which were boosted by delayed loadings from February. Article continues below… Platts Coal Trader provides the latest prices for key benchmark coals, as well as: Daily pricing for tons and allowances for SO2 and NOx emissions The exclusive Platts OTC Broker Index, a market assessment compiled from three of the largest and most respected coal brokers What happened […]

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California Adopts “Unprecedented” Restrictions On Water Use As Drought Worsens

Early last month we warned that California’s drought was approaching historic proportions and that if climatologists were to be believed, the country may see a repeat of The Dirty Thirties as experts cite “Dust Bowl” conditions. Governor Jerry Brown has called for statewide water restrictions aimed at reducing consumption by 25%. Now, the conservation calls are getting much louder as the state’s water regulators have approved “unprecedented” measures aimed at curtailing the crisis. Via AP : California water regulators adopted sweeping, unprecedented restrictions Tuesday on how people, governments and businesses can use water amid the state’s ongoing drought, hoping to push reluctant residents to deeper conservation. The State Water Resources Control Board approved rules that force cities to limit watering on public property, encourage homeowners to let their lawns die and impose mandatory water-savings targets for the hundreds of local agencies and cities that supply water to California customers. […]

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The Return Of Peak Oil – Worrying Signs From U.S. And Russia

Since around 2005 many countries have increased their oil production but more have decreased. But the combined production of the United States and Russia have kept the world on a slight uptrend since that time. World oil production jumped in 2011, hardly moved at all in 2013 but it was up by more than 1.5 million barrels per day in 2014. And after such a huge gain everyone and their brother were singing “peak oil is dead’. But if you scroll down through the 37 major world oil producers it becomes obvious that a majority of nations have peaked and most of them are in steep decline. The above chart is EIA data; however, the next four charts below are JODI data with the last data point February 2015. The data on all charts is thousand barrels per day. In the last decade it has been two of the […]

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Reserve Growth in West Siberian Oil Fields

What is Reserve Growth? BP :  In general, a portion of a field’s probable and possible reserves tend to get converted into proved reserves over time as operating history reduces the uncertainty around remaining recoverable reserves: an aspect of the phenomenon referred to as ‘reserves growth’. Wiki : Experience shows that initial estimates of the size of newly discovered oil fields are usually too low. As years pass, successive estimates of the ultimate recovery of fields tend to increase. The term reserve growth refers to the typical increases in estimated ultimate recovery that occur as oil fields are developed and produced. Basically the U.S. Security and Exchange Commission have stringent reserve booking requirements for oil companies. As a result early booked reserves of any given field is very conservative. Also, any company would much rather have reserves too low and increase them later than have them too high and have to […]

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Einhorn’s Doomsaying Falls on Ears Deafened by Latest Oil Rally

Money manager David Einhorn’s doomsday outlook for shale oil drillers so far is failing to resonate with investors. A pessimistic assessment of the industry by the president of Greenlight Capital Inc. on Monday briefly shook the stock of the companies Einhorn targeted, dropping EOG Resources Inc. by as much as 2.8 percent after he spoke out and Concho Resources Inc. by as much as 3.5 percent. By the end of the day, though, both companies recorded gains, probably reflecting continued investor confidence that oil’s price plunge from more than $100 a barrel in 2014 is spurring cost cuts and new drilling strategies in an industry long known for its profligate spending. Crude prices have risen by 36 percent since March 17, eliminating much of the decline of the preceding nine-month oil-market rout. The oil price drop “sped up the ‘reset’ process,” said Andrew Cosgrove, an energy analyst for Bloomberg […]

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Is United States Energy Independence in Sight?

The data analysis arm of the US Department of Energy is forecasting that despite low oil prices, the US will become energy independent within a decade.  That result depends on frugality as much as resource abundance, and it includes substantial volumes of energy trade with the rest of the world. The US Energy Information Administration’s latest Annual Energy Outlook features the key finding that the US is on track to reduce its net energy imports to essentially zero by 2030, if not sooner. That might seem surprising, in light of the recent collapse of oil prices and the resulting significant slowdown in drilling . EIA has covered that base, as well, in a side-case in which oil prices remain under $80 per barrel through 2040, and net imports bottom out at around 5% of total energy demand. Either way, this is as close to true US energy independence as I […]

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Oil Prices Rise Ahead of U.S. Supply Data

May 6, 2015 5:25 a.m. ET By Georgi Kantchev LONDON–Oil futures rose Wednesday ahead of key U.S. supply data expected to show that the oil-market glut is starting to abate. Industry group American Petroleum Institute said late Tuesday that its data showed crude oil supplies in the country fell by 1.5 million barrels last week. The U.S. Energy Information Administration will release its official estimate for last week later Wednesday, and analysts surveyed by The Wall Street Journal expect the inventories rose by 1.1 million barrels. Brent crude for June delivery rose 2.1% to $68.95 a barrel on London’s ICE Futures exchange. On the New York Mercantile Exchange, light, sweet crude futures for delivery in June were trading at $61.90 a barrel, up 2.5% from the previous close. Besides inventory levels, market participants also will track crude oil production in the U.S. data. While it has been running at […]

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Oil bulls drive crude to 2015 high on fall in U.S. stocks

LONDON (Reuters) – Oil prices rose more than a dollar to 2015 highs on Wednesday, as a month-long rally gained further impetus from a fall in U.S. crude stocks and conflict in the Middle East. Brent crude jumped by $1.36 to $68.88 a barrel by 0855 GMT, after hitting a 2015 peak of $69.14. U.S. crude traded $1.51 higher at $61.91 a barrel, near an intraday high of $62.05. "We haven’t seen hedge funds and money managers to be as optimistic and bullish as they are currently," said Vyanne Lai, an oil analyst with National Australia Bank. "They are at their most bullish since July last year, when the oil market fundamentals haven’t really changed that much." Industry group the American Petroleum Institution (API) said on Tuesday that U.S. crude oil stocks fell for the first time this year, giving a lift to oil prices. The API said that […]

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U.S. Oil Prices Rise Above $60 a Barrel

U.S. oil prices surged above $60 a barrel Tuesday for the first time since December as geopolitical events rattled the market. Prices gained on news that protesters in Libya had blocked a key port, interrupting more than 100,000 barrels a day of crude production. Growing Libyan production was a key factor behind the oil market’s plunge of more than 40% in 2014, but the country’s output remains volatile due to unrest. Later in the day, prices rose further as Saudi Arabia raised the official prices for its crude in the U.S. and Europe, suggesting an increase in demand. Tuesday’s jump extends the strong rally in oil prices, which gained 25% in April. Investors expect the global glut of crude to shrink in the second half of the year due to a sharp drop in drilling activity, an increase in demand and an anticipated decline in U.S. crude production. The […]

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Brent crude slips towards $66 on Saudi plan to halt Yemen bombing

SINGAPORE (Reuters) – Brent crude oil futures slipped towards $66 a barrel on Tuesday, falling from a 2015 high, as Saudi Arabia considered halting bombing in Yemen to allow the delivery of aid, which eased concerns about oil supply from the Middle East. A stronger U.S. dollar also weighed on the dollar-denominated commodity, while investors waited for data on U.S. commercial crude oil inventories later this week for more direction. Brent crude oil futures were down 17 cents at $66.28 a barrel at 0640 GMT, after touching a 2015 high of $67.10 on Monday. U.S. crude oil futures fell by 12 cents to $58.81 a barrel. "The stronger U.S. dollar and also news out of Saudi Arabia that they are halting the bombings in Yemen are two push-pull factors affecting the oil prices at the moment," said Ben Le Brun, a market analyst at OptionsXpress in Sydney. The Saudi […]

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Natural Gas Pulls Back After an ‘Overcooked’ Rally

By Timothy Puko Natural gas prices retreated slightly Tuesday as traders pulled back from a five-session rally that analysts said was based on overly optimistic expectations for demand. Natural gas for June delivery settled down 4.1 cents, or 1.5%, at $2.78 a million British thermal units on the New York Mercantile Exchange. The losses ended a rally that had pushed up the market more than 13% since it hit a nearly three-year low on April 27. That rally pushed too far, too fast, analysts said. Demand is likely to increase in the summer, but production is still near a record high. And for the next few weeks, temperatures look very comfortable, enough to create big surpluses of natural gas because there won’t be a demand for it to heat homes or burn it for electricity to run air conditioners. "Warmer than normal temperatures in the Northeast will be bearish […]

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Where Are Oil Prices Headed? Two Experts Make Their Conflicting Cases

High U.S. output is keeping railroads busy and fueling an inventory buildup that could pull prices down. Photo: MCT via Getty Images For much of the past year, oil prices were headed in one direction: down. With output swelling from the shale-oil boom, the U.S. benchmark fell 59% from its 2014 high last June to its low on March 17. But then came a sudden reversal. Amid concerns about the impact of low prices on supply, oil prices in April posted their biggest monthly gains in about six years. So, where are oil prices headed next? A lot is riding on the answer. Oil prices have a profound impact on everything from the health of the global economy to international relations, from the fate of energy companies to the pocketbooks of individuals. Cheap oil, for instance, has been a boon to consumers around the world, but sustained low prices […]

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Shale Giants See Growth Again After 40% Price Climb

An well pump near Sweetwater, Texas. EOG Resources Inc. and Pioneer Natural Resources Co., two of the largest shale-oil producers, are preparing to boost drilling again after oil prices climbed 40 percent in the past seven weeks. EOG Chairman and Chief Executive Officer William Thomas said Tuesday his company will increase drilling as soon as oil prices, which closed above $60 a barrel for the first time this year, stabilize at $65. Pioneer is planning to add drilling rigs starting in July, subject to oil price movements and the sale of other assets. New drilling now means the companies can add to production in 2016. The statements come a month before the Organization of Petroleum Exporting Countries is scheduled to meet to discuss supply quotas. The price of West Texas Intermediate, a U.S. benchmark, has gained on speculation the oil glut was easing. Drillers cut rigs to a five-year […]

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Oil Analysts Practice Cautious Capitulation as Crude Surprises

A Valero Energy Corp. oil refinery stands in Memphis, Tennessee, U.S. Refiners globally processed an extra 1 million barrels a day last quarter compared with a year earlier. Photographer: Luke Sharrett/Bloomberg As oil prices climbed above $68 Tuesday for the first time since December, analysts at some of the world’s biggest banks were holding onto views that this would be a bad year for crude — just not as terrible as they originally predicted. Rather then extending last year’s losses, Brent, the global benchmark, has rallied about 50 percent from a six-year low in January as demand accelerated and the rapid growth in supplies started to slow. The rebound is a shock. At the start of 2015, Bank of America Corp., Barclays Plc and Goldman Sachs Group Inc. all predicted that oil might collapse to about $30 a barrel. Now, though, they are raising their price estimates while remaining […]

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U.S. shale firms, new oil swingers, may put a $70 cap on prices

(Reuters) – U.S. shale drillers, widely seen as having taken over from OPEC as the swing suppliers to the world, quickly adjusting production as prices ebb and flow, may have just put a $70 a barrel lid on oil. Just months after slashing spending and cutting back on rigs in response to a 60 percent price rout, major domestic producers including bellwether EOG Resources Inc and top Bakken producer Whiting Petroleum Corp are already starting to talk about the price at which they would ramp up production. Others, such as Devon Energy Corp and Noble Energy Inc., are pumping more oil than expected this year after the industry’s deepening drive for more efficient and productive wells yielded better-than-expected results. For some analysts, these are signs of a new price ceiling forming in oil markets and serve warning to traders that a new wave of shale supplies could be quickly […]

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OPEC policy rollover likely in June as oil rebounds: delegates

LONDON/DUBAI (Reuters) – OPEC countries are set to maintain current production levels at a meeting next month, three delegates said, as Gulf states continue to focus on market share and a rally in crude prices mutes calls from other members for supply cuts. While the June 5 meeting in Vienna is likely to hear demands from some members of the Organization of the Petroleum Exporting Countries for a reduction in the amount of oil pumped, even officials from countries which favor a curb see it as unlikely. A surprise rally driven by tensions in the Middle East and signs the supply glut will ease pushed Brent crude to a 2015 high of $68.23 a barrel on Tuesday, up from January’s nearly six-year low close to $45. Oil prices more than halved last year after reaching $115 a barrel in June. "The prices were expected to be below $40 for […]

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Halt to Libya’s Zueitina oil port, linked fields cuts output more

TRIPOLI/BENGHAZI, Libya (Reuters) – All crude flows to Libya’s Zueitina port have stopped after protesters demanding jobs blocked a pipeline, forcing the closure of several eastern oilfields, oil officials said on Tuesday. State oil firm NOC confirmed the port closure, reported by Reuters on Monday, but did not specify the impact on production. The closure should lower oil output to as low as 400,000 barrels a day, according to estimates based on previous production figures. "The protesters closed the pipeline to the port," Mohamed El Harari, spokesman for state oil firm NOC, said. He said that several oilfields in eastern Libya would have to close. "This will have a big impact on oil production," he said, without giving a figure. A port official said the security situation at the terminal was normal, adding that the port would technically stay open. Libyan oil ports and oilfields regularly have to shut […]

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Saudi finance minister: our position is very strong despite cheap oil

RIYADH (Reuters) – Saudi Arabia’s financial position is very strong despite the plunge in oil prices since last year, and the kingdom is focusing spending on economuc development projects to stimulate the private sector, Finance Minister Ibrahim Alassaf said on Tuesday. In a speech to a major financial conference, Alassaf also said he was optimistic that the global economy was emerging from its slump, citing indicators from Europe and Japan. But he added that one couldn’t expect a return to growth levels of 10 years ago. Low oil prices are a challenge to oil exporting countries in general, including Saudi Arabia, but Riyadh is able to use its spending to avert the negative impact, Alassaf said. He said a new Council of Economic and Development Affairs, created by King Salman on taking the throne in January, would help to accelerate decision-making and support government efforts to improve the business […]

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Iran’s oil sector not yet open, U.S. says

Iranian oil sector not yet open for U.S. business opportunities, a spokesman for the U.S. State Department said. File photo by Maryam Rahmanian/UPI WASHINGTON, May 5 (UPI) — The Iranian oil sector is not yet open to U.S. interests and action there may face significant scrutiny from Washington, the State Department said. Deputy Oil Minister Abbas Moqadam said Monday representatives from the United States are expected in Iran this week. If sanctions are lifted, Iran can expect "the presence of major international U.S. oil and gas companies," he said. The Iranian government is pressing for more sanctions relief from a framework agreement slated to take force in mid-2015. Jeff Rathke, a spokesman for the U.S. State Department, said he had doubts about the validity of the minister’s comments. "We’ve been quite clear that we don’t consider Iran to be open for business yet, and that if there is any […]

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Saudi Arabian City of Najran Hit by Mortars

ENLARGE This photo shows an army tank being transported, in the city of Najran, Saudi Arabia, near the border with Yemen on April 23. Mortars and long-range rockets struck the city on Tuesday. Photo: Associated Press Mortars and long-range rockets blasted cars and punched holes in buildings in the southern Saudi Arabian city of Najran on Tuesday, a Saudi official said, underscoring the threat posed to the nation’s territory by the instability across its southern border in Yemen. The attack was the first significant offensive against a Saudi city since a Saudi-led campaign of airstrikes began in March against Yemen’s Iran-backed Houthi militants . A Saudi military official told state television that the Houthis were responsible, while three Houthi officials said local Yemeni tribesmen launched the attack in coordination with the Houthis. It wasn’t immediately clear who was responsible. As the shelling intensified, Saudi authorities took emergency steps. They […]

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IMF says may agree on $800 million loan to Iraq in weeks

DUBAI (Reuters) – Iraq has requested financial assistance from the International Monetary Fund (IMF) and agreement may be reached within weeks on a loan of about $800 million (529 million pounds), a senior IMF official said. Iraqi finances have been hit hard by the plunge of oil prices since last year as well as by the Islamic State insurgency. The government has projected a budget deficit of about $25 billion this year, in a budget of some $100 billion. Aid from the IMF could ease the pressure and by increasing investor confidence, help Iraq raise money from other sources. Baghdad has said it plans to issue $5 billion of debt in its first international bond sale for nine years. "Teams will work on the issue in coming weeks. We hope we can reach a conclusion relatively soon," Masood Ahmed, Director of the IMF’s Middle East and Central Asia Department, […]

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Libyan oil exports to slow as protests block pipeline to Zueitina port: sources

Exports from Libya’s 70,000 b/d capacity Zueitina oil export facility are likely to slip after protesters blocked a pipeline feeding the port, sources said Tuesday. The latest wave of civil unrest in Libya — this time said to be workers demanding improved pay and conditions at the port — could see the North African country’s oil exports drop further from already significantly reduced levels. Production in Libya has fallen to an estimated 400,000 b/d with exports likely to be only half that after output was shut in at the major Elephant (El Feel) field in late April, adding to the ongoing disruption elsewhere in the country. At Zueitina, loadings continue from stockpiles, one trading source said, but that could not continue indefinitely. Article continues below… "Exports from stock are still going on [but] if the unrest remains, Zueitina will be [exporting] less," the source said. Another said the disruption […]

Posted On : Published By : Tom Whipple
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Iraq exports continue upward trend

Tugboats position a single point mooring (SPM) buoy in the Basra Gulf in January 2012 as Iraq expands its export capacity. (ALI ABU IRAQ/Iraq Oil Report) Recommend Sign Up to see what your friends recommend. Iraq’s oil exports are hitting record highs, as the country addresses some of the crude quality problems and political disputes that had recently constrained oil sales.Exports rose to 3.077 million barrels per day (bpd) in April, according to an Oil Ministry statement – a 3 percent increase over March – setting another high-water mark for the post-Saddam Hussein era.Iraq could have exported even more oil from its main outlets in the Basra Gulf, but two of the three operational single… 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 .

Posted On : Published By : Tom Whipple
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King’s changes make Saudi policy less predictable

RIYADH (Reuters) – Changes in Saudi Arabia’s leadership have concentrated power in an inner circle of the Al Saud dynasty, removing constraints on the monarch and making the conservative kingdom’s strategic positions less predictable. The world’s top oil exporter has always prized stability, developing policies slowly and altering them rarely, partly because of the need to balance rivalries among ruling family members and their conflicting interests. That may now be changing. Since inheriting the throne from his brother in January, King Salman has embarked on a war in neighboring Yemen, restructured the oil sector and shaken up domestic governance, including the line of succession. Whether this is the beginning of a much more assertive foreign policy aimed at countering rival Iran, a new energy strategy or a more authoritarian security approach, as analysts have speculated, remains unclear. But what is increasingly apparent is that Riyadh’s new rulers enjoy more […]

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Report: 2.2 million Iraqis displaced by Islamic State

BEIRUT (AP) — A Norwegian humanitarian group says a record 38 million people have been internally displaced in their countries worldwide, with 2.2 million Iraqis alone forced to flee from their homes in 2014 after the Islamic State group overrun their areas. The study by the Norwegian Refugee Council’s Internal Displacement Monitoring Center was released Wednesday. It says 11 million were newly displaced last year – mostly because of conflicts in Syria, Iraq, South Sudan, Nigeria and the Democratic Republic of Congo, accounting for 60 percent of the new displacement. The group says at least 1.1 million Syrians also fled their homes last year. Syria has the highest number of internally displaced, with 7.6 million dislodged because of the conflict, now in its fifth year. That’s at least 35 percent of the population.

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Iran to release seized Maersk vessel after it pays fine

TEHRAN, Iran (AP) — Iran says a Marshal Islands-flagged cargo vessel seized by Iranian forces in the Strait of Hormuz will be released within two days, after it pays a fine. Foreign Ministry spokeswoman Marzieh Afkham told reporters Wednesday says the April 28 seizure of MV Maersk Tigris followed a legal complaint by an Iranian private company. Afkham says that, "based on the information we have acquired, it is likely that the dispute will be settled within next two days." Iranian forces boarded the ship after firing warning shots across the bridge, prompting the U.S. Navy to dispatch a destroyer and a plane to the area in response. Danish shipping company Maersk Line chartered the container ship from Rickmers Ship Management in Singapore and insists it had no "special cargo" such as military equipment.

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Venezuela’s Economy Suffers as Import Schemes Siphon Billions

Photo Venezuelan oil workers demonstrating against the United States in March. During the boom years of high oil prices, little was done to stop the billions that disappeared through corruption and fraud. Credit Meridith Kohut for The New York Times CARACAS, Venezuela — The weed whackers were $12,300. Each. Then there was the $1.8 million machinery to kill and gut chickens. When the police checked it, they found a worthless jumble of rusted scrap metal. And there were the businessmen who collected $74 million to ship chemicals and other products from abroad — but sent almost nothing in return. For years, Venezuela has had a hole in its pocket, a very big hole. The government’s complex currency system has led to exorbitant schemes by importers, who wildly inflate the value of goods brought into the country to grab American dollars at rock-bottom exchange rates. Sometimes, they fake the shipments […]

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World’s Worst Air Spurs Modi’s $25 Billion Utility Clean-Up Push

Barely 16 miles from central Delhi, a 40-year-old coal-fired power plant run by NTPC Ltd. stands testament to the bargain struck by India’s capital city: The world’s dirtiest air for electricity. The state-owned utility is now seeking to cut emissions across its facilities in India, starting with its oldest — the one in Delhi. NTPC plans to spend 12 billion rupees ($189 million) annually on technology upgrades, a company official said, asking not to identified as the person isn’t authorized to speak on the subject. “Their Badarpur plant is running way beyond its life,” said Chandra Bhushan, deputy director general at Centre for Science and Environment , a lobby group based in the city. “The result is its coal consumption is very high and so are the emissions.” NTPC’s clean-up attempt is part of Prime Minister Narendra Modi’s $25 billion spending proposal to revamp aging utilities as he seeks […]

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Beneath Antarctica, a wonderland of oil awaits

A report in The New York Times published on Monday revealed that the Chinese are aggressively engaged in securing the country’s energy future overseas. The People’s Republic is courting Latin American governments, securing its ties to African strongmen, is building up a military presence in the South China Sea, and has sent hundreds of advisors to the Caribbean; all in pursuit of energy security. One of the PRC’s latest targets is the frozen continent of Antarctica, where an international accord reached in 1959 prohibits mining and military activity. “But [Chinese President Xi Jinping’s visit to a south Australian port last autumn] was another sign that China is positioning itself to take advantage of the continent’s resource potential when the treaty expires in 2048,” The Times reported, “or in the event that it is ripped up before, Chinese and Australian experts say.” And the stakes are high for China and […]

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‘Beyond petroleum’ – fracking’s collapse heralds the arrival of peak oil

Despite the exploitation of unconventional oil resources like high-cost tar sands (pictured in Canada) and shales, peak oil really is upon us. Photo: Gord McKenna via Flickr (CC BY-NC-ND). The ‘death of peak oil’ has been much exaggerated, writes Paul Mobbs. Take out high-cost ‘unconventional’ oil and production peaked ten years ago, and even North America’s fracking and tar sands boom has failed to open up new resources both big enough to make good the shortfall, and cheap enough to reward investors. We really do need to be thinking ‘beyond petroleum’. This is the cleft stick within today’s global energy supply: too little ‘cheap energy’ to enable economic growth, too low a return on capital to allow investment in higher production. A few weeks ago tremors rocked the world of ‘fracking’ in the USA – though few heard them. The US Energy Information Agency (USEIA) had issued its latest […]

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U.S. shale oil firms say refracking not the best path in downturn

HOUSTON/WILLISTON, N.D. (Reuters) – Refracking, the practice of fracking an oil and gas well a second time, is still too unpredictable to rely on as a way to slash costs and increase output during the oil price slump, top U.S. shale oil executives said on Tuesday. Oilfield service companies, including Schlumberger NV and Baker Hughes Inc., have touted refracking as a cheap way to revive output from existing shale wells. Output from existing wells, measured in barrels per day, normally drops as much as 70 percent in the year of operation. Also, some wells were not thoroughly fracked the first time. But executives from producers say the refracking technology, while promising, remains tricky. "We have not tried any refracks. Our outlook on that is that it is really technical," said Bill Thomas, CEO of EOG Resources Inc., widely regarded as one of the most efficient U.S. shale oil producers. […]

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Canadian oil trains shift to carry less-volatile crude

CALGARY, Alberta (Reuters) – A growing share of Canadian oil-by-rail traffic is made up of tough-to-ignite undiluted heavy crude and raw bitumen, say industry executives, as companies scramble to cut expenditures with the price of crude down more than 40 percent since June. By eliminating the cost of diluting with ultra-light condensate, heavy oil offers rail shippers an opportunity to claw back a few dollars per barrel in transportation costs. Official data does not break down the different Canadian crudes shipped by rail but interviews with industry executives suggest undiluted heavy and raw bitumen shipments now make up roughly a quarter of the estimated 200,000 barrel per day (bpd) oil-by-rail market. An added bonus is that heavy crude and bitumen are far less combustible than the Bakken and Canadian synthetic crudes involved in fiery crashes that spurred the Canadian and U.S. governments on Friday to tighten safety rules for […]

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Rising oil prices put U.S. driving recovery at risk: Kemp

LONDON (Reuters) – U.S. gasoline demand is running around 300,000 barrels per day above last year’s level, as lower pump prices and continued economic expansion encourage motorists to use their cars more. Estimates for gasoline supplied to U.S. customers published by the Energy Information Administration (EIA) show demand consistently running above the same point in 2014 There is no way accurately to measure fuel consumption in real time. EIA estimates product supplied as a residual from reported refinery output, imports, exports and stock changes. Errors estimating the other terms therefore result in errors estimating demand. Exports are particularly problematic because the agency does not survey these directly and has to the delayed publication of customs data. EIA’s estimating procedure can have problems allocating the disappearance of fuel between domestic use and exports particularly when the level of exports is changing rapidly. Nonetheless, the data show clearly large amounts of […]

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Alberta Tory Dynasty at Risk as Voters Seek Change

Alberta, home to Canada’s vast oil sands, is preparing for a political shake-up for the first time in a generation as voters head to the polls Tuesday with surveys showing the Progressive Conservative’s 44-year dynasty may be coming to an end. Premier Jim Prentice is seeking to extend his Conservative party’s reign with a 13th-consecutive majority. Polls show the Tories, as the party is known, trailing Rachel Notley’s New Democrats and the right-leaning Wildrose under Brian Jean. An NDP victory may weigh on oil company earnings and share prices as the pro-labor party has pledged to raise corporate taxes and review the royalty payments made by producers, said AltaCorp analyst Jeremy McCrea. Prentice, who has led the province since September, called the early election just days after releasing a March budget designed to loosen the government’s reliance on oil revenue by increasing taxes on income, gasoline and alcohol. The […]

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Radioactive and Short on Cash to Pay for Closures

The Three Mile Island Nuclear Plant is seen in the early morning hours in Middletown, Pennsylvania on March 28, 2011. Photographer: Jeff Fusco/Getty Images At the edge of Humboldt Bay in northern California lies a relic from the heyday of U.S. nuclear power. The reactor was shut down in 1976. The remaining cost to decommission the plant once and for all -– cleaning up lingering radiological dangers, dismantling the remains — will be about $441 million, according to its owner, PG&E Corp. The question is who will pay — for Humboldt Bay, and for dozens of other reactors that are in the process of closing or might soon. Nuclear operators like PG&E are supposed to lay up enough money to cover the costs, similar to how corporations fund pensions. Turns out, most haven’t. PG&E’s Humboldt Bay trust fund, for instance, is currently $308 million short, according to a company […]

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Marcellus Shale Extraction Fluids Discovered in 3 Water Samples

Chemical compounds used to extract natural gas were found in three water samples from Pennsylvania’s Marcellus Shale region, according to a study published Monday in the Proceedings of the National Academy of Sciences. The contamination occurred at three Bradford County households whose owners settled a lawsuit with Chesapeake Energy Corp. in 2012 after natural gas polluted their well water. The additional chemicals may have mixed with groundwater after a pit leak from a conventional well or when nearby drilling drove them toward the aquifer, according to the study. “We’re not claiming that it’s from hydraulic fracturing,” Garth Llewellyn , a hydrogeologist at Appalachia Hydrogeologic & Environmental Consulting LLC, and the study’s lead author, said in a telephone interview Monday. “We’re not trying to make assertions where we shouldn’t be. We’re looking at all the possibilities.” In hydraulic fracturing, water and chemicals are blasted into rock formations to extract oil […]

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