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Nigeria: Scarcity – IPMAN Seeks Police Protection, Begins 24-Hour Sale of Fuel

The Independent Petroleum Marketers Association of Nigeria (IPMAN) has appealed to the Inspector-General of Police to provide adequate protection for its members, to enable them sell fuel for 24 hours. Chief Chinedu Okoronkwo, IPMAN’s President, made the appeal in an interview with the News Agency of Nigeria (NAN) on Monday in Abuja. Okoronkwo said the appeal had become necessary following the unions directive to its members to sell fuel for 24 hours to clear the queues that had persisted across the country. The president, who expressed concern over the queues, said the measure was to ease the scarcity and make the product available to motorists. "We were not part of the strike that gave birth to the scarcity but we have taken the measure because when the system is burnt all other parts of the body will be affected. "Major marketers, transporters, owners and drivers, in one way or […]

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As Coal Prices Fall, Miners Cut Output

SYDNEY—China’s appetite for coal used in steelmaking is faltering, deepening a market downturn miners say is the worst in recent memory. The price of steelmaking coal shipped from Australia, the world’s biggest exporter, has fallen 23% this year to roughly $86 a metric ton, its lowest level in nearly a decade. The slide extends a decline begun in 2011, during which the fuel’s value has slumped by around three-quarters. But analysts caution that prices will recover only if more cuts are made. The consultancy Wood Mackenzie doesn’t expect the oversupply of steelmaking coal, or coking coal, to clear up until about 2022. China, whose breakneck economic growth has been the engine for most global commodity markets, won’t need as much steelmaking coal in future, analysts now project. That leaves miners who rushed to open new pits in the boom years to struggle. Chinese sectors such as heavy industry and […]

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China May services PMI rises to 53.5, new business up most since 2012

SHANGHAI Activity in China’s services sector accelerated in May as new business rose at the fastest pace in three years, a private survey showed on Wednesday, a rare piece of good news for policymakers struggling to reviving a cooling economy. Still, economists remain cautious on China’s overall economic outlook, as credit growth remains weak and manufacturing stagnates, reinforcing views that authorities will have to roll out more stimulus to avert a sharper slowdown. The headline HSBC/Markit Purchasing Managers’ Index (PMI) for May was 53.5, up from 52.9 in April and well above the 50-point level that separates expansion from contraction. The May figure represented the fourth straight month of acceleration. The new business sub-component was at 54.4, up from 52.8 in April and the highest reading since 54.7 in May 2012. Employment at services firms grew at the fastest rate since January 2013, the survey showed, another encouraging sign […]

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China services PMI continues to grow: HSBC

BEIJING, June 3 (Xinhua) — China’s service sector continued to expand in May, according to an industry index released by HSBC on Wednesday. The HSBC/Markit services purchasing managers’ index (PMI) posted at 53.5 in May, up from 52.9 in April, registering the quickest expansion in eight months. The index samples more than 400 private service sector companies in China. A reading above 50 indicates expansion. HSBC said the growth was supported by a further increase in new work in May, and the latest increase in new business and new orders at service sector companies also boosted the PMI growth. On Monday, HSBC/Markit announced that the PMI for China’s manufacturing sector in May stood at 49.2, higher than the preliminary official reading of 49.1. Annabel Fiddes, an economist at Markit, said the latest China PMI data saw a strong service sector performance offsetting a deteriorating outlook among manufacturers, leading to […]

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Why US oil will never go it alone

Let me keep this simple. American energy independence is an enormous red herring, no matter how much the U.S. shale hawks and politicians want it to be true. I can already hear the air over the other side of the Atlantic turning blue as I sit in my airplane seat at 33,000 feet on the way to the OPEC meeting in Vienna. But just bear with me for a moment. What the U.S. shale industry has done in such a short period of time is stunning. Technologically, it is an extraordinary feat; the world of hydrocarbon energy production has been revolutionized. No-one talks about Peak Oil in any meaningful way anymore. No-one questions that shale has added billions of barrels and decades possibly to “in-the-ground U.S. reserves.” In fact if green technologies had done the same feat, then oil would already be history. But there is the point. It […]

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Rhino Resource Partners idles majority of US Central Appalachia coal operations

Rhino Resource Partners is temporarily idling a majority of its US Central Appalachia coal operations because of the ongoing weakness in the coal markets, the producer said in a statement Tuesday. The company has sent out WARN notices to a total of 192 workers at its CAPP operations that include three surface mines and one underground mine at the Tug River, Rob Fork, and Deane mining complexes located in eastern Kentucky and West Virginia. Exactly how many employees that will ultimately be affected will depend on future market conditions for CAPP metallurgical and thermal coal, Rhino said. "We are taking difficult actions that are necessary due to the persistent weakness in the coal markets," CEO Joe Funk said in the statement. "Demand for Central Appalachia steam coal has fallen to unprecedented levels as utilities choose low-priced natural gas for electricity generation and other coal-fired capacity is shuttered due to […]

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For green activists, Arctic drilling could be the next big thing

WASHINGTON Michael Brune is pleased that activists in kayaks are training for another "Paddle in Seattle" to confront an expected Royal Dutch Shell rig on its way to the Arctic to explore for oil. What makes the head of the Sierra Club just as happy is the effect Shell’s Arctic ambitions are having on his own environmental organization. Sierra’s funding drive against the resumption in Arctic drilling has taken in three times more money than usual campaigns by the nation’s oldest green group, said Brune, though he wouldn’t reveal specific amounts. And the group’s petition opposing President Barack Obama’s decision in favor of Shell last month has collected more signatures than any appeal in two years. "Our members are outraged because they believe fighting climate change is a moral challenge and they ask how the president can reconcile this move with his goals on climate change," Brune said. "All […]

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Competitive unconventional production gives US diplomatic muscle

Price declines for crude oil in the last 6 months and natural gas in the last 6 years have made US unconventional producers become so much more efficient to stay globally competitive that the US still has significant energy geopolitical opportunities, an IHS official told a US House Energy and Commerce subcommittee. “Compared with 2014, IHS expects investment capital in US shale oil plays to be 65% more efficient at the start of 2016 than the start of 2015 due to compounding productivity and cost cuts,” said Gerald Kepes, IHS vice-president, upstream research and consulting. “IHS anticipates cost reductions to reach 30% over this year with productivity enhancement as much as 15%,” Kepes said during a June 2 Energy and Power Subcommittee hearing. “In 2016, one US dollar of investment will have the same production impact as $1.65 did in 2014.” Changing US policy to permit more US-produced crude […]

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Oklahoma governor signs legislation to prevent local fracturing bans

Oklahoma cities and counties would be unable to ban hydraulic fracturing or other oil and gas operations under Senate Bill 809 that Oklahoma Gov. Mary Fallin has signed into law. The Oklahoma law, effective in 90 days from May 29, allows municipalities or counties to enact regulations concerning road use, traffic, noise, and odors associated with oil and gas operations. It also authorizes fencing requirements around drilling sites and setback requirements for a well from homes and businesses. Fallin noted the law reaffirmed that the Oklahoma Corporation Commission remains Oklahoma’s primary oil and gas regulator. The three commission members are elected by voters. “They are best equipped to make decisions about drilling and its effect on seismic activity, the environment and other sensitive issues,” Fallin said in a statement. “The alternative is to pursue a patchwork of regulations that, in some cases, could arbitrarily ban energy exploration and damage […]

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Exxon Wants to Use Trucks to Move Oil After California Spill

Exxon Mobil Corp. XOM 0.01 % plans to ask Santa Barbara County, Calif., this week for permission to temporarily transport its crude oil in trucks after a pipeline it was using burst two weeks ago , spilling more than 100,000 gallons of oil off the coast. “The County will consider the information provided by ExxonMobil later this week and make an informed decision, based upon our zoning codes, policies and environmental review if warranted,” said Kevin Drude, who heads the county’s energy division, in an emailed statement. Mr. Drude said the pipeline, owned by Plains All American Pipeline PAA 1.42 % LP, pumped about 30,000 barrels a day of crude oil from Exxon’s Las Flores Canyon facility to a pumping station in Gaviota, where the crude then continued on to refineries inland. The pipeline also was used to move some 4,000 barrels a day of oil produced by private […]

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Rising Crude Derails Bakken Tax Trigger

North Dakota Tax Trigger Fails The recent increase in crude prices is good news for North Dakota’s coffers, but bad news for Bakken oil and gas producers. Related: State Set to Lose Millions if Tax Incentives Take Effect North Dakota’s oil tax trigger was introduced by lawmakers to provide tax incentives to strained producers to ease the sting of prolonged lower crude prices. The trigger went into effect in February as WTI crude dipped below the $52.58 price point. The formula requires that crude stay below that price for five consecutive months, for the state to waive its 6.5% oil extraction tax. The oil trigger was expected to take place June 1st, but rising crude prices mean it wont be implemented and producers will miss out on an estimated $480 million over the next six months. Since the nosedive last fall, crude prices inched up after the first of […]

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Solar power getting brighter for U.S. grid

U.S. government approves first three solar projects under a plan for Western states that envisions enough power for 8 million households. UPI/Stephen Shaver WASHINGTON, June 2 (UPI) — The first solar energy projects were sanctioned under a fast-track program that envisions enough power for 8 million homes, the U.S. Interior Department said. U.S. Interior Secretary Sally Jewell announced the first three solar energy projects were approved according to the terms of the so-called Western Solar Plan . Once built, the three projects on public lands in Nevada will generate as much as 440 megawatts of energy, enough to meet the annual demands of about 132,000 homes. "Through thoughtful planning and upfront public participation, these solar projects demonstrate we can reduce permitting times, create certainty for energy developers, and achieve better outcomes for communities and the environment," Jewell said in a statement. The plan, steered by the department’s Bureau of […]

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California water use fell 13.5 percent in April amid drought

AP Photo/Rich Pedroncelli SACRAMENTO, Calif. (AP) — Ordered to use a fourth less water during this record drought, Californians managed to get about halfway to their goal in April, regulators announced Tuesday. California residents reduced overall water usage by 13.5 percent compared to the same month in the benchmark year of 2013, water officials said. That’s the second-best conservation achievement since state officials started closely tracking water use more than a year ago, but falls short of the 25 percent cuts Gov. Jerry Brown that became mandatory for cities and towns on June 1. "Local communities are stepping up in a way they weren’t before, and I’m hoping that’s why we are starting to see the uptick" in conservation, said Felicia Marcus, chairwoman of the state Water Resources Control Board, which compiles usage reports from more than 400 water agencies around California. "The real challenge is, we really have […]

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House energy chair supports lifting oil export ban

WASHINGTON The Republican chairman of the House of Representatives’ energy panel on Tuesday said he favored lifting the 40-year-old ban on U.S. oil exports, a move that could boost support for legislation in the chamber. "Oil exports can be a win for the American people and a win for our allies," said Representative Fred Upton of Michigan in prepared remarks at a hearing. Upton’s backing could clear the path for other representatives to support a bill in the House to overturn the trade restriction Congress enacted in the 1970s after the Arab oil embargo. The measure currently has 40 co-sponsors in the 435-member House. Lisa Murkowski, an Alaska Republican who chairs the Senate Energy Committee, introduced a bill to overturn the ban last month. It has 13 co-sponsors, including one Democrat. Oil producers eager to ship to markets in Asia and Europe say the ban would cause a glut […]

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Greece’s Alliances Fade in European Debate About Its Debt Crisis

Photo European leaders gathered on Monday night in Berlin to discuss the Greek debt crisis, conspicuously excluding representatives of Greece from the meeting. Credit Hannibal Hanschke/Reuters ROME — If Europe is finally coming to a moment of reckoning in the Greek debt crisis — a standoff now rattling financial markets and threatening European unity — then the critical meeting apparently occurred late Monday night, when Chancellor Angela Merkel of Germany summoned critical players to an emergency summit meeting in Berlin. Everyone was invited, except Greece . This was not a big surprise, since those invited were Greece ’s creditors, who were in effect trying to form a united front against Athens and speed up the debt talks before a payment due on Friday. But the list of attendees symbolized how Greece’s far-left government had become very much alone politically, analysts said, and how its promise to roll back the […]

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Greek Insolvency Could Be ‘Gigantic’

BERLIN—The political consequences of a Greek insolvency would be “gigantic,” German Vice-Chancellor and Economics Minister Sigmar Gabriel said Tuesday, calling on the left-wing Greek government to be willing to compromise. His comments come after German Chancellor Angela Merkel , French President François Hollande, European Commission President Jean-Claude Juncker, European Central Bank President Mario Draghi and the head of the International Monetary Fund, Christine Lagarde , met in Berlin Monday evening to discuss ways to break up the deadlock of the Greek debt crisis. “I think it’s absolutely right that Germany and France once again try to find a solution, because the political consequences of Greece’s insolvency within the eurozone would of course be gigantic,” said Mr. Gabriel at a conference. “Many people seem to have somewhat the impression that it’s better to make a painful break than to draw out the agony. The truth is, that if the first […]

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Russia keeps oil output at post-Soviet high before OPEC meet

MOSCOW Russian oil output remained unchanged in May at a post-Soviet high of 10.71 million barrels per day (bpd), Energy Ministry data showed on Tuesday, three days before OPEC meets to decide on output levels. In tonnes, oil output rose to 45.288 million from 43.830 million in April while gas production fell to 48.28 billion cubic meters (bcm) last month, or 1.56 bcm a day, from 52.64 bcm in April. The Organization of the Petroleum Exporting Countries (OPEC), which controls more than 40 percent of the world’s crude oil production, meets this Friday in Vienna. Analysts expect the bloc to maintain current output levels. OPEC sources have said an output cut would only be possible if other oil-producing nations such as Russia join in. Oil revenues are the cornerstone for many countries’ budgets, including Russia. Russian Energy Minister Alexander Novak is due to meet OPEC officials this week ahead […]

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Greece will not pay IMF on Friday without prospect of a deal: lawmaker

ATHENS Greece will not make a June 5 repayment to the International Monetary Fund if there is no prospect of an aid-for-reforms deal with its international creditors soon, the spokesman for the ruling Syriza party said on Wednesday. The payment of 300 million euros ($335 million) is the first of four this month totaling 1.6 billion euros from a country that depends on foreign aid to stay afloat. Greece owes a total of about 320 billion euros, of which about 65 percent to euro zone governments and the IMF, and about 8.7 percent to the European Central Bank. On Tuesday, Greece’s creditors drafted the broad outlines of an agreement to put to the leftist government in Athens in a bid to conclude four months of negotiations and release aid before the country runs out of money. "If there is no prospect of a deal by Friday or Monday, I […]

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Kunstler: Twenty-Three Geniuses

If there is a Pulitzer Booby Prize for stupidity, waste no time in awarding it to The New York Times ’ Monday feature, The Unrealized Horrors of Population Explosion . The former “newspaper of record” wants us to assume now that the sky’s the limit for human activity on the planet earth. Problemo cancelled. The article and accompanying video was actually prepared by a staff of 23 journalists. Give the Times another award for rounding up so many credentialed idiots for one job. Apart from just dumping on Stanford U. biologist Paul Ehrlich, author of The Population Bomb (1968), this foolish “crisis report” strenuously overlooks virtually every blossoming fiasco around the world. This must be what comes of viewing the world through your cell phone. One main contention in the story is that the problem of feeding an exponentially growing population was already solved by the plant scientist Norman […]

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Oil Futures Rangebound Ahead of This Week’s OPEC Meeting

By Eric Yep Oil markets were lukewarm in Asian trade Tuesday as investors remained on the sidelines ahead of the all-important meeting of the Organisation of the Petroleum Exporting Countries later this week. On the New York Mercantile Exchange, light, sweet crude futures for delivery in July traded at $60.20 a barrel at 0313 GMT, unchanged in the Globex electronic session. July Brent crude on London’s ICE Futures exchange fell $0.06 to $64.82 a barrel. The market consensus is largely that OPEC will not change its stance at its June 5 meeting and maintain an oil production ceiling of 30 million barrels a day, as producers like Saudi Arabia choose to their defend market share. The Saudi strategy of defending oil-market share over price is working, its oil minister Ali al-Naimi said on Monday as he arrived in Vienna for the OPEC meeting. Mr. Naimi, a key figure in […]

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Oil prices stabilize, firm demand counters oversupply

SINGAPORE Crude oil prices stabilized on Tuesday due to firm demand after dipping in early trade on expectations that OPEC would not cut output at its meeting this week. The Organization of the Petroleum Exporting Countries (OPEC) meets this Friday in Vienna to discuss its production strategy, with U.S. bank Citi saying the group was likely to maintain current production. Prices were supported as Saudi oil minister Ali al-Naimi said overnight that demand would pick up and tighten the market in the second half of the year. "Comments from Saudi Arabian oil minister Ali al-Naimi were characteristically upbeat, acknowledging a current surplus in the market, but anticipating stronger second half demand and an eventual rebalancing of the market," Citi said in a note responding to his comments. Front-month Brent crude futures fell to a low of $64.71 per barrel on Tuesday, before edging back to $64.85 by 0345 GMT. […]

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Oil Edges Down in Mild Trading as Dollar Gains

Oil pumps in Bahrain. Oil prices started the week lower. Oil prices edged lower Monday as the dollar strengthened, and traders postponed betting on the market until the world’s oil cartel holds its semiannual meeting at the end of the week. Trading volumes in both the U.S. and global benchmark contracts were a fraction of their average levels. Light, sweet crude for July fell 10 cents, or 0.2%, to settle at $60.20 a barrel on the New York Mercantile Exchange, and the global Brent crude contract declined 68 cents, or 1%, to end at $64.88 on the ICE Futures Europe exchange. In the absence of major fundamental news for the market, the day’s moves were largely driven by the dollar, which gained in reaction to positive U.S. economic data on construction spending and manufacturing activity, analysts said. Oil often moves inversely to the dollar, as a stronger greenback makes […]

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Natural Gas Inches Up as Production Data Tapers Off

By Christian Berthelsen Natural-gas futures inched up Monday as investors looked past bearish near-term demand indicators to focus on an apparent pullback from recent production levels. Natural gas for July delivery rose 0.7 cent, or 0.3%, to $2.649 a million British thermal units on the New York Mercantile Exchange. The slight gain ended a five-session losing streak. The U.S. Energy Information Administration and private data groups said pipeline data and other indicators suggest the industry is beginning to cut production. The EIA said in a monthly report that production fell in March for the second time this year, and research consultancy Gelber & Associates said gas flow data on pipelines has been showing declines. Still, analysts expect the EIA’s weekly inventory data to show a major increase when released Thursday. "Production is still near record highs," Gelber said in a note. "The sentiment continues to be bearish." Natural-gas prices […]

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Euro’s Growing Ties to Oil Only Encourage Bears Seeing Parity

If you want to know which way the euro’s headed, ask an oil trader. The euro-dollar rate is tracking crude prices more closely than at any time in the past two years. The European Central Bank gives more weight to the impact of energy prices on inflation than the Federal Reserve, so when oil started falling in the middle of last year it was one more reason for Europe to step up monetary stimulus to boost price growth. The result: the euro lost almost 25 percent of its value against its U.S. counterpart through mid-March, before rallying in line with oil. Given the growing correlation, analyst predictions that crude prices won’t rebound in the next several months are providing support for the view that the single currency will fall toward parity with the dollar. “Having seen how the bounce in oil prices coincided with the bounce in the euro […]

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Russia, Non-OPEC Producers Met with OPEC Last Month

VIENNA—Officials from Russia’s energy ministry last month met with other oil producing countries at the Organization of the Petroleum Exporting Countries headquarters in Vienna to discuss a global oil glut that has sent prices tumbling. The secret conversations ended on May 13 after two days of discussions and without the release of a public statement, people familiar with the matter said. The discussions underscore the distance between OPEC and Russia, the world’s largest oil producer, ahead of Russian Energy Minister Alexander Novak’s unusual visit to Vienna for OPEC’s semiannual meeting. Though Mr. Novak is expected to meet with OPEC Secretary General Abdalla Salem el-Badri and some OPEC ministers from outside the Persian Gulf on Wednesday, he has signaled Russia won’t do what some OPEC hard-liners want: namely cut its own production. “At the meetings, it is not planned to agree on production volumes,” Mr. Novak told the Interfax news […]

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Why $65 per barrel oil looks like a ceiling, not a floor

Tags: oil | oil prices | opec Additional reporting and writing by Kevin Allison. The authors are Reuters Breakingviews columnists. The opinions expressed are their own. Big Oil is too confident about crude prices. After a 40 percent rally from January’s six-year low, the momentum has been on the upside. But the current prices – $65 a barrel for Brent and $60 for WTI – look more like a ceiling than a floor. That is not what many insiders seem to think. Some oil service companies expect mid-$70s Brent by the end of this year. Anglo-Dutch Shell assumed oil will rebound to $90 by 2018 in its $70 billion takeover of the UK’s BG Group. Some believe that the steep cut in capex costs will affect supply, including shale, and boost prices again. But such predictions may underestimate shale’s potential. Lower drilling and pumping costs, among other efficiencies, have […]

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U.N. climate deal in Paris may be graveyard for 2C goal

BONN/WASHINGTON The U.N.’s Paris climate conference, designed to reach a plan for curbing global warming, may instead become the graveyard for its defining goal: to stop temperatures rising more than 2 degrees Celsius above pre-industrial levels. Achieving the 2C (3.6 Fahrenheit) target has been the driving force for climate negotiators and scientists, who say it is the limit beyond which the world will suffer ever worsening floods, droughts, storms and rising seas. But six months before world leaders convene in Paris, prospects are fading for a deal that would keep average temperatures below the ceiling. Greenhouse gas emissions have reached record highs in recent years. And proposed cuts in carbon emissions from 2020 and promises to deepen them in subsequent reviews – offered by governments wary of the economic cost of shifting from fossil fuels – are unlikely to be enough for the 2C goal. "Paris will be a […]

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OPEC officials say no need to raise oil output target

VIENNA OPEC officials dismissed comments from Wall Street bank Morgan Stanley on Monday that the Organization of the Petroleum Exporting Countries may raise its oil output target when the producer group meets this week. The cartel’s present production rate is around 31 million barrels per day (bpd), and the group forecasts the call on OPEC stocks to rise to 30.5 million bpd in the second half of the year, the bank said in a note ahead of OPEC’s June 5 talks. Both are higher than the group’s output target of 30 million bpd, which has remained unchanged for several years. One OPEC delegate, in Vienna for the group’s meeting, said there was no need to raise the target. "You see that OPEC is already producing higher (than 30 million bpd)," the delegate said. An official from an African OPEC country, asked about the possibility of raising the target, said: […]

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Dozens of Iraqi security force members killed in army base attack

At least 42 members of Iraq’s security forces have been killed in a suicide attack targeting an army base north of Fallujah, in Iraq’s Anbar province. The bombing was carried out with an armored Humvee vehicle laden with explosives, military sources told Al Jazeera. Witnesses said ammunition stored in the base’s depot continued to explode several hours after the initial attack, which occurred at 3 a.m. local time Monday. Iraqi officials said the death toll of the attack was likely to rise. The attack came a day after Haider al-Abadi, Iraq’s prime minister, acknowledged the loss of about 2,300 Humvee armored vehicles when the Islamic State in Iraq and the Levant (ISIL) overran the northern city of Mosul last year. Also on Monday, at least 33 Iraqi soldiers and allied militia fighters were killed in an ambush by ISIL fighters in Seddiqiya in Anbar province. More than 40 others […]

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Why Islamic State Keeps Winning

Popular Mobilization forces fire against ISIS militants near Sayed Ghareeb, Iraq, on May 28. Photographer: Mohammed Sawaf/AFP/Getty Images When Islamic State seized Iraq’s largest northern city of Mosul almost a year ago, tribal leader Hekmat Suleiman was sure the extremist militants wouldn’t expand further into his hometown. “We bet Islamic State won’t have what it takes to last,” Suleiman said in October during a visit to the Iraqi Kurdish city of Erbil, smoke rising from his shisha water pipe. “We’ve reached the beginning of the end of extremism.” He was wrong. His hometown of Ramadi fell last month, three days before Islamic State captured Palmyra , a 2,000-year-old UNESCO world heritage city on the Syrian side of its territory. The battlefield victories ahead of the first anniversary of the group’s self-declared caliphate on June 29 emphasize its ability to endure U.S.-led coalition airstrikes as well as lower oil prices, […]

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Americans and Turks Discuss ISIS Threat

Photo Shiite militiamen clashed with members of the Islamic State in Fallujah, Iraq. Turkey wants to clear ISIS from its southern border. Credit Hadi Mizban/Associated Press WASHINGTON — American and Turkish officials are discussing a joint effort to clear Islamic State fighters away from Turkey ’s southern border, a senior State Department official said on Monday. The official did not provide details or explain what role American air power might play, but he said that discussions with Turkish officials had progressed after several rocky months. “We are looking for things we can do in a very material and tangible way,” the official said. “We want to get those extremists off their border. We want to look at a way that we can do that cooperatively with them.” Senior officials from the United States-led coalition that is fighting the Islamic State group are scheduled to meet in Paris on Tuesday […]

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Iran’s Nuclear Stockpile Grows, Complicating Negotiations

Photo Secretary of State John Kerry, left, with the Iranian foreign minister, Mohammad Javad Zarif, in Geneva on Saturday. Credit Pool photo by Susan Walsh WASHINGTON — With only one month left before a deadline to complete a nuclear deal with Iran, international inspectors have reported that Tehran’s stockpile of nuclear fuel increased about 20 percent over the last 18 months of negotiations, partially undercutting the Obama administration’s contention that the Iranian program had been “frozen” during that period. But Western officials and experts cannot quite figure out why. One possibility is that Iran has run into technical problems that have kept it from converting some of its enriched uranium into fuel rods for reactors, which would make the material essentially unusable for weapons. Another is that it is increasing its stockpile to give it an edge if the negotiations fail. The extent to which Iran’s stockpile has increased […]

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French Minister Laurent Fabius Wary on Iran Nuclear Deal

French Foreign Minister Laurent Fabius speaks on Monday in Bonn, Germany. ABUJA, Nigeria—French Foreign Minister Laurent Fabius said a possible nuclear deal with Iran risks sparking a nuclear arms race in the Middle East unless the agreement grants international inspectors access to Iranian military sites and other secret facilities. In an interview with The Wall Street Journal, Mr. Fabius insisted the ability to inspect such sites be part of a final agreement with Iran to ensure Tehran doesn’t covertly try to build a nuclear weapon. The warning highlights a persistent divide between Western negotiators and Tehran , which has demanded Iranian military sites remain off-limits to international inspectors. “The best agreement, if you cannot verify it, it’s useless,” said Mr. Fabius. “Several countries in the region would say, OK, a paper [has been signed] but we think it is not strong enough and therefore we ourselves have to become […]

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Saudi Aramco revisits rig contracts

Saudi Aramco withdraws notice of termination for rig Hercules 261, owner says. Photo courtesy of Hercules Offshore HOUSTON, June 1 (UPI) — U.S. rig company Hercules Offshore said Monday its clients in Saudi Arabia withdrew a notice to terminate a contract for its services. Hercules said Saudi Aramco withdrew its notice of termination for rig Hercules 261, "declaring that all terms and conditions of the contract remain in full force and effect for the remainder of the five-year term of the contract." Hercules in February said it was engaged in talks with the Saudi oil company to reduce the day rates for two other rigs, Hercules 262 and Hercules 266, when the contract was suspended. Hercules 261 is listed in the company’s fleet status update as having a day rate around $135,000. Rigs 262 and 266 have a combined average day rate of around $118,000. "Notwithstanding the receipt of […]

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Naimi says Saudi oil strategy working, sees stronger demand

VIENNA Saudi Arabia’s oil minister Ali al-Naimi said on Monday he expects oil demand to pick up in the second half of 2015 while supply decreases, in a sign that the kingdom’s strategy of defending market share was working. The comment indicates Saudi Arabia will likely propose not to change output policy at producer group OPEC’s meeting on Friday, although Naimi declined to speak directly on the issue. "The answer is yes," Naimi said in his first public comment upon arrival in Vienna, where the meeting will take place, when asked whether the strategy of defending market share through higher supplies and lower oil prices was working. "Demand is picking up. Good! Supply is slowing, right? That is a fact," he told reporters. "You can see that I’m not stressed, I’m happy," he said. Naimi was the key architect of OPEC’s decision at its last meeting in November 2014 […]

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Abu Dhabi Wealth Fund Changing Tack Amid Lower Oil Prices

DUBAI—The Abu Dhabi Investment Authority, a sovereign-wealth fund with assets estimated at more than $700 billion, is relying less on external money managers and handling more of its investments in-house as its owner grapples with lower oil prices. Funded by excess revenue from the government of Abu Dhabi, a major Persian Gulf oil producer, ADIA was managing 35% of its money in-house in 2014, compared with 25% in the previous year, according to an annual review released Tuesday. Investors watch ADIA’s allocations and money-management strategies carefully because of the effect a shift by a fund its size could potentially have on asset prices. The change reflected growth in internal expertise in recent years, the fund’s managing director, Sheikh Hamed Bin Zayed Al Nahyan, said in a letter accompanying the report. “While this work is now nearing its conclusion, we will continue to recruit selectively in 2015,” Sheikh Hamed said. […]

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China Energy Exchange Targets a Market Gap

SINGAPORE—China may have become the world’s largest importer of crude oil in April, but there is one thing it still lacks: its own oil market. That could change this year if the Shanghai International Energy Exchange Ltd., also known as INE, launches a long-planned oil-futures contract in Shanghai’s free-trade zone. Yang Maijun, the chairman of the Shanghai Futures Exchange, one of the partners in INE, said earlier this year that trading in the new oil contract could begin in 2015. The establishment of an oil-futures market in China could prove another milestone in what analysts at Macquarie Group Ltd. MQBKY 1.09 % recently called a “seismic shift in futures-trading firepower from West to East” in commodities markets. Already, the volume of metals futures traded on Chinese exchanges at times eclipses volumes on the London Metal Exchange, according to Macquarie. Ten of the 20 agricultural commodity contracts that had the […]

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Glut of Chinese Goods Pinches Global Economy

DONGYING, China— Liu Zijun built a thriving tire-manufacturing business when China’s economy was roaring ahead. But when China’s growth weakened, he had to cut prices to keep his business afloat. Now the pain felt by industrialists such as Mr. Liu is reverberating across the globe, showing how China, once the world’s most reliable source of growth, is adding to deflationary pressures world-wide. In the rubber-tree fields of Southeast Asia, planters are scrambling to cut prices for their latex fast enough to keep customers in China happy. In the U.S., tire distributors are marking down prices and some are cutting staff as China floods the U.S. with discounted goods from unneeded factories. “The growing production capacity in China changed the U.S. industry,” said Brian Grant, chief executive of Del-Nat Tire Corp., a Tennessee tire distributor that exited the business early this year after chalking up losses on overpriced inventory it […]

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China factories scrabble for growth in May, export demand shrinks

BEIJING Growth in China’s giant factory sector edged up to a six-month high in May but export demand shrank again, prompting companies to shed jobs and keeping alive worries about a protracted economic slowdown, a government survey showed on Monday. In a sign that China’s worst downturn in at least six years is hurting its services companies, too, a similar survey showed growth in that sector slipped to a low not seen in more than five years. Services have been one of the lone bright spots in the Chinese economy in the last year. The muted reports reinforced the view that authorities would have to roll out more stimulus in coming months, despite having cut interest rates three times in six months. "China’s economy still faces strong headwinds," economists at ANZ Bank said in a note to clients. "If capital outflow continues at the pace of the first quarter, […]

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Easy Access to Money Keeps U.S. Oil Pumping

Wall Street’s generous supply of funds to U.S. oil drillers helped create the American energy boom. Now that same access to easy money is keeping them going, despite oil prices that are languishing around $60 a barrel. The flow of money into oil has allowed U.S. companies to avoid liquidity problems and kept American crude production from falling sharply. Even though more than half of the rigs that were drilling new wells in September have been banished to storage yards, in mid-May nearly 9.6 million barrels of oil a day were pumped across the country, the highest level since 1970, according to the most recent federal data. Helped by a ready supply of money, the flow of oil from the U.S. could keep crude prices low for the remainder of 2015 and beyond. It wasn’t supposed to happen this way. As crude prices began to plunge last year, many […]

Posted On : Published By : Tom Whipple
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New low rig count in North Dakota

The number of rigs actively exploring for or producing oil and natural gas in North Dakota hits new low at 80, state data show. Photo by David Gaylor/Shutterstock BISMARCK, N.D., June 1 (UPI) — The number of rigs actively exploring for or producing oil and gas in North Dakota hit a new low Monday at 80, state data show. The number of rigs in service in North Dakota, a state at the heart of the shale oil and gas boom, was down 62 percent from 2012 levels and 57 percent lower than this date in 2014. State data show oil production in March, the last full month for which data are available, was 1.19 million barrels per day, a 1 percent increase from the previous month, but 2.6 percent below the all-time high reached in December 2014. The state’s oil and gas division reported the number of wells in […]

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Oklahoma next to ban drilling bans

Oklahoma Gov. Mary Fallin signs state measure that’s meant to avoid "patchwork" of local legislation on oil and gas drilling. File Photo by UPI/J.P. Wilson OKLAHOMA CITY, June 1 (UPI) — Oklahoma’s governor said a "patchwork" approach to oil and gas regulation wasn’t in the state’s interest, reaffirming a state entity as the sole overseer. Gov. Mary Fallin signed a bill establishing the state’s Corporation Commission as the sole regulator of the oil and gas industry in the state. "The bill aims to preserve a unified regulatory framework for the industry and prevent a confusing patchwork of inconsistent municipal regulations across the state," her office said in a statement. "A patchwork of regulations that vary across the state would be inconsistent with the goal of reasonable, easily understood regulations and could damage the state’s economy and environment." Fallin’s signature follows last month’s signing by Texas Gov. Greg Abbott of […]

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Western Canadian Wildfires Shut in Oil Sands Production

CALGARY—Wildfires that have crimped Alberta’s oil sands production for more than a week continue to burn, officials said Monday, dealing another blow to producers already spooked by low crude prices and expected royalty increases. Some 1,400 firefighters in northern Alberta—including hundreds from neighboring provinces—have been working to douse or corral dozens of wildfires which have raged for several days, spread by strong winds and dry underbrush in the boreal forests that dominate the landscape. Of 35 blazes currently being fought, five have yet to be contained, including the largest which has engulfed nearly 80,000 acres in the province’s northeast, said Richard Horne, a spokesman for the Alberta Agriculture and Forestry Ministry. “Our crews are still working around the clock to get the fire under control and build a perimeter,” Mr. Horne said, adding that light rain and milder winds over the weekend helped firefighters extend a fire proof zone […]

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Natural Gas is Killing Coal

There’s no denying that natural gas is revolutionizing our energy economy, but few believed it could deal such a swift death blow to coal, the commodity that brought us into the Industrial Revolution and has been our backbone ever since. But the signs are irrefutable. Here’s what you need to know. A historic battle Coal and natural gas have been going at it for a while. Traditionally, these were actually complementary energy sources. As a cheaper fuel that was more difficult to manage, coal-fired generation plants were the “slow burners” that kept our energy capacity steady throughout the day. Relatively expensive and more malleable natural gas-fired power plants served as the “pinch hitters” that powered up during peak hours when we needed that extra bit of juice. Today, things look a bit different. Natural gas and coal are no longer complements: natural gas has become a substitute for coal. […]

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Paris Geothermal Boom Brings Deep Drilling to Crowded Suburbs

Work on the floor of the drilling rig at the geothermal energy extraction site in Paris. Photographer: Kosuke Okahara/Bloomberg Squashed between a highway overpass and a towering suburban shopping center east of Paris, a drilling rig is completing the second of two geothermal wells aimed at capturing the earth’s natural heat for homes and offices. The project is one of five around the French capital being built by Engie, the new name for GDF Suez SA, accelerating a geothermal boom in the region. Greater Paris already boasted the world’s largest concentration of deep geothermal wells linked to heating networks, even before these latest additions. An energy law making its way through the French parliament that seeks to spur rewewable energy could lead to more. “This is the most active period for geothermal in two decades,” Damien Terouanne, head of Engie’s Cofely Reseaux unit that specializes in heating and cooling […]

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Six European energy companies make low-carbon plea

Six of the biggest European energy companies issue plea for a mechanism that will help advance low-carbon goals. File Photo by Stephen Shaver/UPI LONDON, June 1 (UPI) — Six of the largest European oil and gas companies issued a global appeal Monday for a mechanism to limit global warming and curb emissions. The heads of BG Group, BP, Eni, Royal Dutch Shell, Statoil and Total called on governments and the United Nations to introduce a carbon pricing scheme . "We now need governments around the world to provide us with this framework, and we believe our presence at the table will be helpful in designing an approach that will be both practical and deliverable," they said in a joint statement. Their appeal comes as world leaders are working toward finding climate solutions at a December conference in Paris. Last week in Mexico, the International Energy Agency said policy uncertainty […]

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Sluggish factory growth in Europe and Asia puts central bank stimulus in spotlight

LONDON/SYDNEY Manufacturing activity showed scant sign of picking up across Europe and Asia in May as demand stayed stubbornly weak, highlighting the need for central banks to continue supporting growth. The gloomy business surveys come a little less than three months after the European Central Bank embarked on a 1 trillion-euro stimulus program and will likely fuel expectations its counterpart in Beijing will have to roll out more aggressive policy measures. Euro zone factory growth was weaker than previously thought last month while Chinese factory activity barely accelerated and South Korean exports sank. "Across the euro zone as a whole it is plodding along. We can probably do with a little bit more strength out of Germany and France," said Peter Dixon at Commerzbank. "We are going to have to live with rather slower growth in China. We have seen some modest monetary easing and I expect that will […]

Posted On : Published By : Tom Whipple