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Sturdy U.S. jobs report boosts chances of Fed rate hike

WASHINGTON U.S. job growth accelerated sharply in May and wages picked up, signs of momentum in the economy that bolster prospects for an interest rate hike in September. Nonfarm payrolls increased 280,000 last month, the largest gain since December, the Labor Department said on Friday. While the unemployment rate rose to 5.5 percent from a near seven-year low of 5.4 percent in April that was because more people, likely new college graduates, entered the labor force, indicating confidence in the jobs market. Payrolls for March and April were revised to show 32,000 more jobs created than previously reported. That together with an eight cent gain in average hourly earnings raises the chances of the Federal Reserve tightening monetary policy this year. "This certainly puts more ammunition in the Fed’s plan to start lift-off in September," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia. The dollar […]

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BHI: US rig count continues steady but shrinking decline

The US drilling rig count dropped 7 units during the week ended June 5 to settle at 868 rigs working, according to data from Baker Hughes Inc. For the second straight week, the decline represents the second-smallest of the now 26-week slump, during which time the count has lost 1,052 units ( OGJ Online, Dec. 5, 2014 ). Compared with this week a year ago, the count is down 992 units. Last week the count officially fell below the nadir of 876 during the 2008-09 downturn ( OGJ Online, May 29, 2015 ). BHI also reported that the average US rig count for May was 889, down 87 from April and 970 from May 2014. A total of 857 land rigs represented a decline of 86 month-to-month and 944 year-over-year, while a total of 32 offshore rigs represented a decline of 1 unit month-over-month and 26 units year-over-year. Raymond […]

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California Farmers Dig Deeper for Water, Sipping Their Neighbors Dry

Photo A farm served by the San Luis Canal Company, which manages the water supply for about 45,000 acres in California. Credit Chad Ress for The New York Times Early one morning in late April, Parvinder Hundal stood beside a hole in the ground at the edge of his almond farm near Tulare in the Central Valley of California. The hole, which was about the size of a volleyball and was encased in a shallow block of concrete, was the opening of a well, one that went hundreds of feet into the earth. He had paid $100,000 to have it drilled, but it wasn’t producing water. Mr. Hundal was hoping that if he cleaned out the well, the water would start flowing again. On the nearby trees, some leaves had turned yellow and the almond husks appeared smaller than usual. In February, Mr. Hundal received emails from various water […]

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High Inflation Makes Ukraine’s Troubled Situation Worse

Photo The Petrivka market in Kiev. Across Ukraine, the price of everything seems to have gone up sharply, including tea, apples and fresh fish. Credit Brendan Hoffman for The New York Times KIEV, Ukraine — Olesia Verchenko looked over a selection of blackened avocados at a supermarket here recently. Their price has roughly doubled over the last year, notwithstanding the stickers on them advertising a 25 percent discount. “I don’t think anybody takes avocado anymore, so they are basically rotting on the shelves,” said Ms. Verchenko, an economist. While the rest of Europe tries desperately to shrug off low inflation, Ukraine has added rapidly rising prices to its long list of problems during its civil war with Russian-backed rebels. Official inflation figures showed that prices rose 61 percent in April compared with a year earlier. But many prices have doubled and tripled. Ms. Verchenko, a 37-year-old mother of two […]

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U.S. Oil-Rig Count Drops Modestly Again

The drop is a deceleration from last week, when the count fell by 13. 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. The market rallied earlier this year on expectations that spending cuts would help shrink the global glut of crude, but large supply cuts haven’t materialized so far. U.S. data released on Wednesday showed domestic oil production at a new weekly high, fueling concerns that the global crude market continues to be oversupplied. On Friday, OPEC said it would keep its production ceiling unchanged , the second time in six months it decided to take no action amid the global glut. According to Baker Hughes, gas rigs were down by three to 222 this week. The U.S. offshore rig […]

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Floods Threaten Bakken Producers

North Dakota experienced its wettest May on record and all the rain is causing trouble for some oil and gas producers. The region had almost 8 inches of rain last month and now flood waters threaten operators near the confluence of the Missouri and Yellowstone rivers. More rain is expected and could cause raise flood levels to 22 feet by this weekend. North Dakota regulators have stepped up inspections and are urging producers to take precautions. Inclement weather can easily wreak havoc on the energy infrastructure including well flooding, road closures and truck bans. Related: Wet Weather Forcing Delays in Bakken Oilfield Alison Ritter, a spokeswoman for the state Department of Mineral Resources, said 13 companies were notified to secure their equipment. “The well sites might not flood but the access roads might,” Ritter said. “So we want to make sure they have everything secure now in case they […]

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Oil exports a strategic move, Murkowski says

Exporting domestic crude oil could be a strategic U.S. asset, lawmakers say. Photo by tcly/Shutterstock WASHINGTON, June 5 (UPI) — U.S. Sen. Lisa Murkowski again pressed for an end to a 1970s ban on crude oil exports, arguing the United States can prove its mettle with its oil reserves. Legislation enacted in response to the 1970s oil embargo by Arab members of the Organization of Petroleum Exporting Countries bans the export of unprocessed crude oil. With U.S. oil production eclipsing 9 million barrels per day, Murkowski argued ending the ban would be a strategic initiative. "This is something that is simply in the best interest of the United States, in terms of both our economic strength and our national security," she said in a statement. "The time to legislate on oil exports is now." Murkowski, R-Alaska, chairwoman of the Senate Energy Committee, introduced a measure in May that seeks […]

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Energy job losses mount, but sector recovering

Federal data show the extractive industries suffering in weak crude oil market, though career firm Challenger, Grey & Christmas finds silver lining. UPI/Maryam Rahmanian WASHINGTON, June 5 (UPI) — The number of people seeking unemployment assistance in May in the U.S. extractive industries was up by nearly 5 percentage points year-on-year, federal data show. The Bureau of Labor Statistics reported an unemployment rate of 7.2 percent in May for the mining, quarrying, and oil and gas extraction sectors. That’s up from the 2.6 percent reported in May 2014. Of all non-farm sectors surveyed by the bureau, the extractive industries were the lone standout in terms of job losses year-on-year. "Total non-farm payroll employment increased by 280,000 in May, and the unemployment rate was essentially unchanged at 5.5 percent," Friday’s report read. A report from this week from career transition firm Challenger, Grey & Christmas finds the employment climate in […]

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Longevity of bear oil market concerns Texas

Dallas Federal Reserve frets over the potential duration of the down turn in the crude oil market. Photo by ekina/Shutterstock DALLAS, June 5 (UPI) — One of the primary challenges looming for over the health of the Texas state economy is the low price of oil, a report from the Dallas Federal Reserve said. A research report from the bank found one of the major economic concerns for the state was the low price of oil. The price for West Texas Intermediate, the U.S. benchmark, is off more than 40 percent from June 2014 and most analysts expect the depressed cycle to continue. "While the state’s economy has become more diverse and thus less reliant on the oil and gas industry, the price drop has still negatively affected the Texas economy and labor market," the report said. "Some pockets of the state remain heavily dependent on the energy sector, […]

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Ukraine Repels Separatists in Fierce Fighting, Poroshenko Says

Photo Ukrainian service members hauled a cart of ammunition on Friday in Maryinka, a town near Donetsk where they have been battling pro-Russia separatists. Credit Evgeniy Maloletka/Associated Press KIEV, Ukraine — In what amounted to a multidimensional confidence-building campaign, President Petro O. Poroshenko of Ukraine tried on Friday to rally international support for his country and to maintain pressure on President Vladimir V. Putin of Russia, including economic sanctions. Mr. Poroshenko held a major news conference, gave interviews to foreign journalists, spoke by phone with President Obama and Chancellor Angela Merkel of Germany, and prepared to welcome two visiting prime ministers to Kiev, Shinzo Abe of Japan and Stephen Harper of Canada. His diplomatic activities precede a summit meeting of leaders of the Group of 7 nations that is scheduled to begin Sunday at Schloss Elmau in the Bavarian Alps, with security issues on the agenda. In each of […]

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Conoco stops its shale gas exploration in Poland

WARSAW ConocoPhillips, the U.S. energy company, is withdrawing from shale gas exploration in Poland as it has not encountered commercial volumes of the gas, the company said on Friday. ConocoPhillips said its subsidiary Lane Energy Poland has invested around $220 million in Poland since 2009. It drilled seven wells over its three Western Baltic concessions. "Unfortunately, commercial volumes of natural gas were not encountered," Tim Wallace, ConocoPhillips country manager in Poland, was quoted as saing in a statement. ConocoPhillips was the last major oil company looking for shale gas in Poland, after Chevron withdrawal at the start of this year. (Reporting by Agnieszka Barteczko; Editing by William Hardy)

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Norway Will Divest From Coal in Push Against Climate Change

Photo A coal-fired plant in Germany. Norway’s $890 billion government pension fund will shift money away from companies using coal. Credit Patrik Stollarz/Agence France-Presse — Getty Images Norway’s $890 billion government pension fund, considered the largest sovereign wealth fund in the world, will sell off many of its investments related to coal, making it the biggest institution yet to join a growing international movement to abandon at least some fossil fuel stocks. Parliament voted Friday to order the fund to shift its holdings out of billions of dollars of stock in companies whose businesses rely at least 30 percent on coal. A committee vote last week made Friday’s decision all but a formality; it will take effect next year. The decision — which could seem paradoxical, given that Norway is a major producer of oil and gas — is certain to add momentum to a push to divest in […]

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Winners and Losers When Oil is $50 a Barrel

Major technological advances in horizontal drilling and hydraulic fracturing (fracking) have dramatically expanded U.S. oil and gas production. By year-end 2014, U.S. daily crude oil production from shale layers had increased 230 percent over 2010 levels, and total U.S. crude oil production had risen 67 percent. Despite that dramatic, unprecedented growth, the price of West Texas Intermediate (“WTI”), used as a global benchmark for oil pricing, remained between $80 a barrel (bbl) and $110/bbl from October 2010 until late November 2014. The unrelenting and massive increase in U.S. oil supply should have driven down the global price of oil. It didn’t because as these new U.S. supplies were coming online, geopolitical conflicts were flaring up in key oil-producing regions around the world. For example, there was a civil war in Libya. Iraq faced threats from ISIS. Both the United States and Europe imposed new sanctions on Iran, significantly curtailing […]

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Oil Prices Fall as Traders Await OPEC Meeting

NEW YORK—Oil prices sank to a one-week low Thursday as traders assessed ample global crude supplies ahead of the Organization of the Petroleum Exporting Countries’ Friday meeting. An oversupply of crude oil, largely due to robust production from the U.S. and some OPEC members, is keeping prices more than 45% below their highs from last June. Many analysts and investors expect the global oil glut to shrink in the coming months as demand increases and U.S. production falls in response to spending cuts. For the time being, market watchers say, world-wide crude output continues to exceed consumption. Light, sweet oil for July delivery recently fell $1.64, or 2.7%, to $58 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell $1.77, or 2.8%, to $62.03 a barrel on ICE Future Europe. OPEC, which opted against cutting production at its last meeting despite plunging oil prices, is […]

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Oil prices fall as OPEC seen keeping production high

SINGAPORE Oil markets fell for a third day on Friday ahead of an OPEC meeting where the oil group is expected to stick by its policy of unconstrained output for another six months, keeping the market oversupplied. Saudi Arabia’s oil minister Ali al-Naimi said he was 100 percent comfortable with the oil market, the Saudi-owned al-Hayat newspaper reported on Friday. After cautious early trading in Asia, prices started to fall on Friday as the first Europeans began dealing. Front-month Brent futures LCOc1 were trading at $61.73 per barrel at 0720 GMT on Friday, down 30 cents. U.S. crude futures CLc1 were down 39 cents at $57.61. Prices had already tumbled 5 percent over the previous two sessions as investors looked for the global oversupply to continue. "Prices came under pressure as Iraq … exports are now expected to rise approximately 5 percent in June as various fields boost output," […]

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Oil trader Hall sees U.S. crude above $65 despite high OPEC output

NEW YORK Renowned oil trader Andy Hall expects U.S. crude to rise above $65 a barrel despite high global production of oil led by OPEC, citing the drop in U.S. oil rigs as a factor. "Despite a collapse in rig counts in the U.S., oil production has yet to register a sustained decline. But it will come," Hall said in the monthly letter to investors in his $3.3 billion Connecticut-based hedge fund Astenbeck Capital Management. Some in the market believe oil prices have found a floor after last year’s rout. While drilling has become more efficient, Hall argued that cannot compensate in the near-term for the 60 percent drop in the U.S. rig count. "Oil prices will continue to work their way higher over time toward the global marginal cost of production, and in our view that is above $65 WTI," Hall said, referring to the U.S. crude benchmark, […]

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Oil Prices Fall as Traders Await OPEC Meeting

NEW YORK—Oil prices sank to a one-week low Thursday as traders assessed ample global crude supplies ahead of the Organization of the Petroleum Exporting Countries’ Friday meeting. An oversupply of crude oil, largely due to robust production from the U.S. and some OPEC members, is keeping prices more than 45% below their highs from last June. Many analysts and investors expect the global oil glut to shrink in the coming months as demand increases and U.S. production falls in response to spending cuts. For the time being, market watchers say, world-wide crude output continues to exceed consumption. Light, sweet oil for July delivery recently fell $1.64, or 2.7%, to $58 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell $1.77, or 2.8%, to $62.03 a barrel on ICE Future Europe. OPEC, which opted against cutting production at its last meeting despite plunging oil prices, is […]

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Oil prices fall as crude glut overshadows strong fuel demand

SINGAPORE Oil prices fell on Thursday as a large crude glut overshadowed strong global fuel demand ahead of a meeting on Friday in which OPEC looks to be unlikely to change its production quota. The Organization of the Petroleum Exporting Countries (OPEC) is expected to continue to produce about 2 million barrels per day (bpd) above demand, adding to a glut that has left millions of barrels stored on tankers without a buyer. Front-month Brent futures LCOc1 were down 30 cents at $63.50 per barrel by 0717 GMT. U.S. crude futures CLc1 dropped 40 cents to $59.24. Energy advisory Wood Mackenzie said on Thursday it was unlikely OPEC would agree to cut output at its June 5 meeting and that it expected the group’s crude output to remain just above its 30 million bpd production ceiling through 2016. The company said it forecast Brent to average $60 a barrel […]

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Natural Gas Rebounds Despite Data Showing Second-Largest Surplus on Record

Natural gas prices dipped, then rebounded to near unchanged as traders who respond to charts boosted the market despite new data showing the second-largest weekly surplus on record. Prices bounced after falling just past a one-month intraday low of $2.557 a million British thermal units. That could have been enough to scare a slew of bearish traders into quickly unwinding pre-existing bets that profit when the market falls, traders and analysts said. Such trades are closed out by buying futures to cover the position, which can feed into a price rally when it is done in large numbers at the same time. The front-month July contract lost 0.8 cent, or 0.3%, to $2.626 a million British thermal units on the New York Mercantile Exchange. Prices had fallen as much as 3% in the morning before, flip-flopping around unchanged the rest of the day. The low point came after the […]

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NYMEX July gas futures settle at $2.626/MMBtu, down 0.8 cent

The NYMEX July natural gas futures contract settled 0.8 cent lower at $2.626/MMBtu Thursday following a US Energy Information Administration storage report that showed a build well above expectations. US natural gas in storage rose 132 Bcf to 2.233 Tcf in the week that ended May 29, the EIA said in its weekly storage report, compared with analysts’ consensus expectations of a 118-122 Bcf injection. "The 132 Bcf injection was the largest injection since 2003 and the second largest injection ever reported," Kent Bayazitoglu, head of energy market analytics at Gelber & Associates, said in daily commentary. The reason for the much larger-than-expected injection, Bayazitoglu said, was mild weather that suppressed demand during the week ended May 29 and continued strong growth in supply. In other words, supply continues to outstrip demand. Article continues below… Platts Natural Gas Alert provides global coverage of the major natural gas and LNG […]

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EY: Delayed Impact of Price Downturn Seen in Oil, Gas Production, Reserves

Oil and gas industry spending, production and revenue grew in 2014 despite the oil price downturn seen late last year. But industry will feel more of the impact of that downturn in 2015. Lower oil prices seen late last year did not thwart growth in the oil and gas industry’s capital expenditures (CAPEX), revenues and reserves for 2014, and are comparable to growth levels seen in 2013, according to the results EY’s eighth annual US oil and gas reserves study. The study results came from analysis of the Top 50 public U.S. oil and gas companies’ supplement reserve disclosures and annual financial statements. The study of all 50 companies found that all categories of CAPEX spending rose to $200.2 billion in 2014 from $173.1 billion in 2013, an increase of 16 percent. Proved and unproven property acquisition costs accounted for a large portion for this growth — each rose […]

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Bloated oil market fed more crude from unwinding sea storage plays

LONDON Physical oil is coming under pressure as trade houses unwind a profitable storage play after several months that saw them holding millions of barrels on tankers at sea. A drop in the volume of crude stored for speculative profit is putting more supply into an already saturated market, elbowing out new loadings leading to a build-up of unsold West African, North Sea and Mediterranean oil. "When the contango started, it created a demand," said Tamas Varga of PVM oil brokerage. Now "they are creating additional supply". "The structure of the market should weaken significantly," Varga added. "There is just lots of oil around in the U.S. and globally." Oil prices collapsed by 60 percent between June last year and January 2015, pushing the cost of oil for immediate delivery to a big discount below future prices and making it profitable to buy oil and store it for sale […]

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Warming Pause Cited by Climate Skeptics Countered in New Report

The pace of global warming hasn’t slowed since 1998, a finding that contradicts a major United Nations study and challenges a key argument of skeptics of manmade climate change. Temperatures since 2000 have risen at a pace that is “virtually indistinguishable” from the rate of the five preceding decades, researchers led by Thomas Karl at the U.S. National Oceanic and Atmospheric Administration said Thursday in the journal Science. That challenges the biggest-ever UN study on warming published in September 2013, which found that the rate of temperature gains had fallen by more than half since 1998. Doubters of man’s influence on the climate have cited the reported slowdown as proof that the scientific understanding of climate change isn’t robust and steps to cut greenhouse gases aren’t worth the cost. “A whole cottage industry has been built by climate skeptics on the false premise that there is currently a hiatus […]

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OPEC moots $80 as new ‘fair’ oil price – but will it stick?

VIENNA Nearly a year after oil markets entered a deep downward spiral, unmoored from the $100-a-barrel mark that had anchored them for years, some OPEC members are publicly talking for the first time about a new "fair" price for their crude. Oil ministers from Iraq, Venezuela and Angola said in Vienna this week that a price of $75 or $80 a barrel – barely $10 above the going rate – could be just fine. Iraq’s Adel Abdel Mahdi said it would be "equitable". Privately, one Gulf OPEC delegate also told Reuters he reckons crude may be trading around this level next year, once markets rebalance. It remains to be seen whether this new range becomes a common refrain for the group, which has effectively given up efforts to maintain prices in order to defend its share of the world market. Importantly, Saudi Arabia – which for years had pointed […]

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Iran Pushes to Be Heard at OPEC Meeting

VIENNA—The Organization of the Petroleum Exporting Countries is under pressure to prepare for Iran’s full return to the oil market if western sanctions are lifted, but the group is unlikely to take action on the issue at its meeting Friday, the group’s delegates said. Instead, OPEC is expected Friday to reaffirm its decision last year to keep current production levels despite low oil prices , delegates said. It is also expected to consider a request from Indonesia, which is a producer that is a net importer of oil, to rejoin the cartel after a six-year absence. The prospect of Iran returning in full force to the world oil market has been an undercurrent in both public and private meetings this week in Vienna, where OPEC ministers have been holed up for several days. But an Iran freed from sanctions could add to a global oversupply of crude that has […]

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Will Saudi boost oil capacity? Naimi’s retort: Show me 10 percent return

VIENNA When it comes to whether Saudi Arabia will invest billions of dollars to increase its ability to pump more oil, boosting the world’s only large stand-by reserve, minister Ali al-Naimi has a quick answer: show me the return. Naimi, speaking informally to reporters in Vienna on Thursday, was asked whether the kingdom needs to lift its capacity now that it is pumping crude at its fastest rate in over three decades to meet a resurgence in demand. The country last embarked on a $100 billion push to raise its capacity a decade ago amid a price boom fueled by China’s growth. It can now pump as much as 12.5 million barrels per day (bpd), scarcely 2 million bpd above current output. With casual banter, Naimi responded: "Is there demand for Saudi crude? Can you guarantee it? If I go and put a dollar, will you guarantee that I […]

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Indian Oil, Hindustan Petroleum to Buy Crude from Iraq

Hindustan Petroleum Corp. said it a statement it has been in touch with Somo, the oil-marketing company of the Iraq government, to seek an allocation of 2 million barrels of crude oil in the coming month. The procurement comes after India’s oil ministry asked Hindustan Petroleum and Indian Oil to purchase 4 million barrels of Basra light crude oil on behalf of Indian Strategic Petroleum Reserves, Hindustan Petroleum Corp. said in a filing to stock exchanges Thursday. Indian Oil Corp. separately said it acted as a facilitator for the import of crude from Iraq on behalf of the Indian government. The crude is meant for the strategic reserves, the company said in a filing to stock exchanges. India, the world’s fourth-largest petroleum consumer, is setting up three centers at Vishakhapatnam, Mangalore, and Padur, in the southern part of India, to store crude to meet its needs in times of […]

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China is hoarding cheap oil in a fleet of supertankers

China is hoarding oil As Middle East oil producers drive prices lower and make life difficult for the U.S. fracking industry, one clear winner is emerging: China The world’s second-largest economy become the top oil importer in April. The key reason? China is taking advantage of cheap oil to boost its strategic reserves. “They’ve been building out strategic storage. The goal is to build out to about 500 million barrels, compared to the U.S. capacity of 700 million to 800 million barrels,” said Jeff Brown of Singapore-based energy consultants FGE. Brown said that while the numbers are a little murky, China has already built out about 150 million barrels of extra storage, with more capacity planned through the end of the year. “They take a lot of pride in buying oil when it’s cheap,” he said. Despite the massive capacity boom, China is still buying more oil than it […]

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In Kentucky, talk of a ‘war on coal’ gives way to hope for new economy

HARLAN COUNTY, KY When Dan Mosley became head of Kentucky’s Harlan County government this year, he promised – like those elected before him – to defend the state’s beleaguered coal industry. But Mosley also vowed to do something else for his county: help build a new economy based on something other than coal. "The best business I’ve seen in town lately has been the U-Haul business because people are moving out," said Mosley, a boyish-looking father of two, speaking after a community meeting in the century-old coal town of Benham. "The time has come to wipe away our tears," he says. "We have no choice but to diversify.” Talk of an economic transition remains difficult in eastern Kentucky, where you can still spot bumper stickers that read "Mine Every Lump" and statues honor coal miners. These are the people Kentucky Republican Senator Mitch McConnell says are victims of an […]

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Bakken gets federal crime strike force

Federal task force created to tackle organized crime in the Bakken oil fields of Montana and North Dakota. Photo by photostock77/Shutterstock WASHINGTON, June 4 (UPI) — State and federal authorities announced the creation of a "strike force" aimed at addressing organized crime in and around the Bakken oil field. "The strike force will have the capability of not only dismantling local criminal organizations in the Bakken, but also to take out the national and international components of these organizations wherever they may be located," acting U.S. Attorney for the District of North Dakota Chris Myers said in a statement. North Dakota last year received a $3 million federal grant to help address crime in the western part of the state, where much of the Bakken and Three Forks oil reserves are situated. State lawmakers complained, however, that FBI and Drug Enforcement Agency officials aren’t stationed permanently in Williston, the […]

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Texas oil and gas outlook negative

Dallas Federal Reserve expects weak momentum in oil and gas sector for the rest of the year as crude oil prices remain low. (UPI/Shutterstock/Lilac Mountain) DALLAS, June 4 (UPI) — The outlook in the Texas oil and gas sector remains negative as most companies expect low capital spending in 2016, the Dallas Federal Reserve said. Texas is the No. 1 oil producer in the nation. A weak market for crude oil, however, is throttling the state’s overall energy trajectory. In its latest data release, the Railroad Commission of Texas, the state’s energy regulator, said preliminary data from March show crude oil production averaged 2.31 million barrels per day, down from the 2.34 million bpd reported in February. The Dallas Federal Reserve in its so-called Beige Book said demand for oil field services , as well as the number of rigs actively exploring for or producing oil and natural gas, […]

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Alaska adds oil to U.S. total

U.S. federal data show Alaska accounted for all of the growth in total weekly crude oil production. U.S. Sen. Lisa Murkowksi, R-Alaska, has led efforts to put state back on the top of the U.S. energy map. Photo by Kevin Dietsch/UPI | License Photo WASHINGTON, June 4 (UPI) — Alaska accounted for all of the growth in U.S. oil production from the week ending May 29, data released from the Energy Department show. The U.S. Energy Information Administration said in its weekly petroleum status report total U.S. crude oil production for the week ending May 29 was 9.6 million barrels per day. Output from the Lower 48 states was unchanged from the previous week and production from Alaska increased by 4.1 percent to 507,000 bpd. The U.S. Interior Department in January released a draft proposal for access to federal waters for exploration and drilling. While an Atlantic Ocean area […]

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Woodside, Sempra mull Texas LNG project

Australian energy company Woodside exploring options for liquified natural gas export facility in Texas. Photo courtesy of Woodside. PERTH, Australia, June 4 (UPI) — Australian energy company Woodside said Thursday it was in preliminary discussions to explore options for liquefied natural gas development in Texas. The Australian company said affiliate Woodside Energy signed a non-binding memorandum of understanding with energy company Sempra LNG. "[Both sides] will commence preliminary discussions and assessments pertaining to the potential development of a natural gas liquefaction facility at Port Arthur, Texas," Woodside said in a statement. The potential project could have a total export capacity of 10 million tons of LNG per year once permitted. In March, Sempra started the filing process with the Federal Energy Regulatory Commission to export LNG sourced from U.S. reserve basins to countries that have, or will have, a free-trade deal with the United States. A special permit is […]

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Glencore May Cut Coal Output Further to Combat Glut

Coal prices have fallen sharply since Glencore closed its purchase of Xstrata two years ago. In a rare public presentation, Glencore’s Australia-based head of global coal assets, Peter Freyberg, insisted coal was “a very, very important part” of the company, and that executives were considering options to acquire new assets or tie up with other producers with an eye to the long-term. When Glencore closed its purchase of fellow miner Xstrata PLC two years ago, Chief Executive Ivan Glasenberg said the blockbuster deal was “a big play on coal.” Since then, coal prices have fallen sharply, while Glencore’s market value has dropped close to its lowest level since it floated in London and Hong Kong in 2011. Both thermal coal, burned to generate electricity, and coking coal, used to make steel, are languishing due to oversupply caused by too many new projects coming on stream amid slowing demand, particularly […]

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Fracking Has Had No ‘Widespread’ Impact on Drinking Water, EPA Finds

Fracking isn’t causing widespread damage to the nation’s drinking water, the Obama administration said in a long-awaited report released Thursday. The U.S. Environmental Protection Agency—after a four-year study that is the U.S. government’s most comprehensive examination of the issue to date—concluded that hydraulic fracturing, as being carried out by industry and regulated by states, isn’t having “widespread, systemic impacts on drinking water.” However, the EPA said there were a small number of contaminated drinking wells and highlighted potential vulnerabilities, including the disposal of wastewater and construction of durable wells. The report was issued nearly a decade since fracking began helping unlock vast reserves of oil and natural gas across the U.S. It also bolsters the position staked out by the energy industry and its supporters: that fracking can be carried out safely. “Hydraulic fracturing activities in the U.S. are carried out in a way that have not led to […]

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Weekly US coal production estimates fall to five-year low: EIA

Weekly US coal production totaled an estimated 15.1 million st in the week ended May 30, the lowest level in the last five years, US Energy Information Administration data showed Thursday. The estimate was down 6.1% from the prior week and down 20.7% from the year-ago week. It marks the 15th straight week of declining coal production estimates when compared with year-ago levels. The EIA does not comment on its production estimates, but low natural gas prices and increasing coal stockpiles are largely behind the drop in production. Platts unit Bentek Energy estimated coal stockpiles stood at 168.7 million st as of May 28, roughly 24% higher than the same time last year, and up 1% from the five-year average for the week. Article continues below… Platts Global Coal Alert brings real-time coal industry information to those who can’t afford to wait until tomorrow to get market coverage and […]

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Hardening of Positions Undercuts Ukraine Peace Accord

Photo President Petro Poroshenko, in Parliament in Kiev on Thursday, demanded that Russia withdraw all troops from Ukraine. Credit Sergey Dolzhenko/European Pressphoto Agency SHYROKYNE, Ukraine — The trenches near this battered town in southeastern Ukraine slice surreally for miles across fields of sunflowers, in places running in three lines separated by a mile or two of mined ground, Ukrainian commanders say. A feature not just of this bitterly contested ground, the trenches extend in varying degrees of completeness all the way to the northern limits of the line separating Ukraine from the separatist regions in the east. To some extent, they reflect a military necessity, with daily skirmishes along the barrier and occasional flare-ups, like one near Donetsk on Wednesday in which at least 21 people were killed. There is a political subtext as well, a hardening of positions on both sides that is steadily undermining a peace accord […]

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Greece Defers IMF Payment as Merkel Says Resolution Far Away

Greek Prime Minister Alexis Tsipras arrives at his office in Athens after returning from Brussels meetings on June 4, 2015. Photographer: Kostas Tsironis/Bloomberg Greece became the first country to defer a payment to the International Monetary Fund since the 1980s as its game of brinkmanship with creditors goes down to the wire. With Prime Minister Alexis Tsipras getting ready to address parliament on Friday after receiving a list of creditors’ demands, the step underscores the state of the country’s shriveling finances. While international officials have reported some progress in recent days, German Chancellor Angela Merkel said “we’re still far from reaching a conclusion.” The current phase of Greece’s crisis is nearing its conclusion as the country runs out of money after four months of deadlock. Stocks and bonds have whipsawed this week amid a flurry of political activity starting with a late-night meeting in Berlin between European leaders and […]

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Greece delays IMF payment, PM to brief angry parliament

ATHENS/BRUSSELS Greece delayed a key debt payment to the International Monetary Fund due on Friday as Prime Minister Alexis Tsipras, facing fury among his leftist supporters, demanded changes to tough terms from international creditors for aid to stave off bankruptcy. The IMF said Athens had informed the global lender that it plans to bundle four payments due in June into a single 1.6 billion euro lump sum, which is now due on June 30. "Under an Executive Board decision adopted in the late 1970s, country members can ask to bundle together multiple principal payments falling due in a calendar month," IMF spokesman Gerry Rice said in a statement. It was the first time in five years of crisis that Greece has postponed a repayment on its 240 billion euro bailouts from euro zone governments and the IMF, and it came as German Chancellor Angela Merkel said talks on a […]

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Oil prices fall as crude glut overshadows strong fuel demand

SINGAPORE Oil prices fell on Thursday as a large crude glut overshadowed strong global fuel demand ahead of a meeting on Friday in which OPEC looks to be unlikely to change its production quota. The Organization of the Petroleum Exporting Countries (OPEC) is expected to continue to produce about 2 million barrels per day (bpd) above demand, adding to a glut that has left millions of barrels stored on tankers without a buyer. Front-month Brent futures LCOc1 were down 30 cents at $63.50 per barrel by 0717 GMT. U.S. crude futures CLc1 dropped 40 cents to $59.24. Energy advisory Wood Mackenzie said on Thursday it was unlikely OPEC would agree to cut output at its June 5 meeting and that it expected the group’s crude output to remain just above its 30 million bpd production ceiling through 2016. The company said it forecast Brent to average $60 a barrel […]

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Oil prices drop as oversupply weighs on markets

SINGAPORE Crude oil prices fell on Wednesday as oversupply weighed on markets, with OPEC not expected to announce a production cut at its meeting on Friday. Core Gulf members of the Organization of the Petroleum Exporting Countries (OPEC), which controls over 40 percent of the world’s crude production, have a consensus to maintain the group’s oil output at its meeting this week, a senior Gulf OPEC delegate told Reuters in Vienna on Tuesday. "There is consensus among Gulf OPEC countries, and others, to keep the (production) ceiling unchanged," the source said. "Nobody wants to rock the boat. The meeting is expected to be smooth sailing." High production by OPEC, but also from other regions like U.S. shale producers and Russia, has contributed to oversupply and left tankers filled with millions of barrels of oil without buyers. Some analysts said there was a chance OPEC could increase its production target. […]

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Oil Prices Slide as High Supplies Persist

NEW YORK—Oil prices slumped Wednesday on concerns that the global crude market continues to be oversupplied. Robust production from the U.S. and member nations of the Organization of the Petroleum Exporting Countries sent oil prices plunging last year, and prices remain more than 40% below their June highs. The market rallied earlier this year on expectations that spending cuts would help shrink the global glut of crude, but large supply cuts haven’t materialized so far. U.S. data released Wednesday showed domestic oil production at a new weekly high, and OPEC is widely expected to keep its production target unchanged at its June 5 meeting. Light, sweet crude for July delivery settled down $1.62, or 2.6%, at $59.64 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell $1.69, or 2.6%, to $63.80 a barrel on ICE Futures Europe. Traders have closely scrutinized weekly U.S. inventory data […]

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Natural Gas Falls to One-Month Low on Growing Production and Surpluses

Natural gas prices fell to a one-month low Wednesday as traders responded to increasing production and the expectation for growing weekly surpluses. Prices for the front-month July contract lost 6.4 cents, or 2.4%, to $2.634 a million British thermal units on the New York Mercantile Exchange. The move erased all of a small two-day rally and sent gas to its lowest settlement since April 29. The market’s default position is to sell because of chronic oversupply, said Michael Doyle, a broker at Eclipse International Inc. in New York. Production is still at a near-record pace and hot weather isn’t coming to ramp up demand for gas-fired power to run air conditioners, said Jim Ritterbusch, president of energy-advisory firm Ritterbusch & Associates, said in a note. Gains "were just overcooked yesterday," he added. "We didn’t see enough shift in the temperature views to justify" prices near $2.70/mmBtu. The U.S. Energy […]

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World Oil Output Last 3 Years

The EIA publishes every possible energy stat for the USA and hardly anything for the rest of the world. Well, anything current for the rest of the world anyway. Their International Energy Statistics is already five full months behind and working on six. December 2014 is the last international oil production data we have. Anyway during this lull in other data I decided to look at the last three years of international data, from December 2011 to December 2014. All data is in thousand barrels per day. World C+C production was flat for most of 2012 and 2013 but in late 2013 production took off and has increased by about 3 million barrels per day above the average for 2012 and 2013. December C+C production was 79,300,000 BPD. While total C+C production has increased by 3,000,000 BPD over the last three years the top ten gainers have increased just […]

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OPEC finds oil output consensus: ‘Don’t rock the boat’

VIENNA OPEC is set to carry on pumping oil nearly flat-out for months more, content that last year’s shock market therapy has revived moribund demand and knocked back growing competition. With oil prices having stabilized, for now, at around $65 a barrel, some $20 off their January lows, there’s little appetite within the Organization of the Petroleum Exporting Countries to modify production limits, as some analysts have suggested is an outside possibility. "There is consensus among Gulf OPEC countries, and others, to keep the ceiling unchanged," a senior Gulf OPEC delegate told Reuters late on Tuesday after an informal meeting of the four core Gulf Arab OPEC members earlier in the day. The group meets on Friday following a two-day seminar featuring the chief executives of the world’s biggest energy groups, including BP ( BP.L ) and Exxon ( XOM.N ), companies whose fortunes have been abruptly altered by […]

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What not to expect from OPEC at its Friday meeting

Myra Members of the Organization of the Exporting Countries are expected to leave their oil-production ceiling unchanged at their semiannual meeting on Friday, but what they decide not to do is equally important. Analysts widely expect the oil-producing cartel to stand pat on the 30 million barrels-per-day output ceiling it is had in place since 2012, even though various market estimates show that its members have been producing about one million barrels a day above that level. Talk ahead of the summit has been centered on OPEC’s desire to defend its valuable market share. The cartel left its production target unchanged at its last meeting in November, despite a plunge in global oil prices LCON5, -2.70% CLN5, -2.66% and some analysts fear that if OPEC stands pat again, that’ll condemn the market to an oil-supply glut for years . Retaining market share is obviously a key objective for OPEC […]

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How OPEC Hurt Big Oil

VIENNA—The world’s biggest oil companies have taken a beating since the Organization of the Petroleum Exporting Countries let prices fall last year in favor of pumping more crude, injecting a note of tension into a long-standing marriage of convenience. Oil company earnings plunged 50% in the first quarter from a year earlier. Some of the industry’s biggest projects are on ice, and a new mood of uncertainty hangs over the sector as it goes through a rough patch after years of stability. The meeting of the cartel this week amounts to a counseling session of sorts for global integrated oil companies and OPEC, as they all converge on Vienna. But no one expects the good times to return soon. OPEC, at its meeting here on Friday, appears likely to stay the course it set last November, keeping production levels the same . Some oil company executives see a rocky […]

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OPEC Optimistic on Energy Outlook

VIENNA—OPEC oil ministers expressed optimism about their strategy of pumping more crude oil and fighting for market share, amid expectations they will stick to their production target when they meet at the end of the week. “In terms of the global trends of energy outlook, the future looks very positive. The global economy is growing,” Saudi Oil Minister Ali al-Naimi told an oil-and-gas seminar hosted by the Organization of the Petroleum Exporting Countries in the Austrian capital. In a sign of how much things have changed for OPEC, oil ministers from some its most vulnerable nations appeared to come to terms with prices below $100 a barrel, signaling that the group may have put some of its rancor behind it. OPEC ministers from Saudi Arabia, Qatar, and the United Arab Emirates spoke Wednesday morning at the seminar, along with representatives of industry watchdogs and chief executive officers from energy […]

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OPEC’s Problem: There Is No Minister of Shale

When Saudi Arabia launched a global oil-price war last year, most market players assumed America’s high-cost, financially fragile shale producers would be first to retreat. Some retreat. American companies have been quick to idle rigs and lay off workers, but U.S. onshore oil production has gone up since last fall, not down. As oil ministers from member countries of the Organization of Petroleum Exporting Countries meet this week, they are grappling with the fact that the world’s new swing producer is a very different animal from their traditional competitors. Shale-oil companies have more in common with the technology startups of Silicon Valley than the big, often state-controlled, integrated oil companies that dominate global oil markets. They are smaller, more nimble, take more risks and are more tied to the ebb and flow of the capital markets. This agility has enabled them to boost productivity, raise cash, and so far […]

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Using Violence and Persuasion, ISIS Makes Political Gains

Photo The Tadmur prison in Syria after it was blown up by ISIS. Credit via Associated Press BEIRUT, Lebanon — Days after seizing the Syrian desert city of Palmyra, Islamic State militants blew up the notorious Tadmur Prison there, long used by the Syrian government to detain and torture political prisoners. The demolition was part of the extremist group’s strategy to position itself as the champion of Sunni Muslims who feel besieged by the Shiite-backed governments in Syria and Iraq . The Islamic State, also known as ISIS or ISIL, has managed to advance in the face of American-led airstrikes by employing a mix of persuasion and violence. That has allowed it to present itself as the sole guardian of Sunni interests in a vast territory cutting across Iraq and Syria. Ideologically unified, the Islamic State is emerging as a social and political movement in many Sunni areas, filling […]

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