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U.S. SPR oil sale before strategic review would be a mistake: Kemp

A field of 14 storage tanks that each hold 510,000bbls of oil can be seen at the Trans-Alaska Pipeline Marine Terminal in Valdez, Alaska on August 8, 2008. “The Strategic Petroleum Reserve is not an ATM,” Lisa Murkowski, chair of the Energy and Natural Resources Committee warned the Senate this week. “It is certainly not the petty cash drawer for Congress.” The senator from Alaska was criticizing a proposal to sell 101 million barrels of crude from the government’s stocks to offset a shortfall in funding in the highway trust fund. “Others are potentially looking to our Strategic Petroleum Reserve as nothing more than a piggybank,” Murkowski admonished her colleagues in a floor speech delivered on Wednesday. There is nothing new or particularly surprising about Congress raiding pots of apparently surplus assets to pay for short-term spending priorities. Between fiscal 1993 and fiscal 2005, almost $6 billion worth of […]

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Philadelphia Energy Solutions seeks to buy Bakken logistics assets

The Philadelphia Energy Solutions oil refinery owned by The Carlyle Group is seen at sunset in Philadelphia March 26, 2014. Philadelphia Energy Solutions is pursuing a joint venture that would give the U.S. East Coast refiner greater control over its supply chain out of North Dakota’s Bakken oil fields, the company has disclosed in federal filings ahead of a initial public offering. PES, a joint venture partly owned by Carlyle Group LP, said in a filing that in early June, it entered into a preliminary agreement with Globe Resources Group, parent company of BOE Midstream. The deal would give PES controlling interest in a 210,000 barrel-per-day crude rail loading facility, nearly 1 million barrels of crude oil storage and a 39-mile pipeline in North Dakota. The Bakken rail terminal will serve the 335,000 bpd PES refinery complex in Philadelphia, the largest consumer of Bakken oil in the country. The […]

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Ruble Sinks With Oil as Bets for Rate-Cut Pause Hit Russia Bonds

The ruble fell to a four-month low as Brent crude extended losses in a bear market, boosting wagers for Russia’s central bank to limit interest-rate cuts this week to avoid accelerating the selloff. As the currency weakened as much as 2.4 percent against the dollar, forward-rate agreements showed traders trimming bets for policy easing to the lowest since December. Royal Bank of Scotland Group Plc and Credit Suisse Group AG said the Bank of Russia may opt to keep interest rates on hold on July 31 to avoid exacerbating the ruble’s slump and stoking inflation. Russian bonds decreased for a sixth day. “Should oil and the ruble continue falling in the coming days, this could reduce room for decisive policy easing” even though the state of Russia’s economy warrants a larger rate cut, JPMorgan Chase & Co. analysts including Anatoliy Shal said in an e-mail to clients. While all […]

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Bleak outlook for oil has Russian investors pulling back

Market analysts are predicting a worse outlook for the prices of crude oil, Russia’s biggest export. Photo by Shutterstock MOSCOW, July 27 (UPI) — As international sanctions push Russia toward its first recession since 2009, market analysts are predicting a worse outlook for the prices of crude oil, the country’s biggest export. The bleak outlook for the price of crude oil has prompted money managers at Franklin Templeton Investments and Paribasto to cut back in Russia, Bloomberg reported. "For now there’s stability, but the price of oil seems to be settling in at a new normal," Ruchir Sharma, the head of emerging markets at Morgan Stanley Investment Management, told Bloomberg Business. "It’s a stability, but stability with stagnation. I don’t know how long they can coexist, but this seems to be the prognosis for now." Brent crude oil dropped 19 percent from this year’s high as the ruble went […]

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Ruble Close to Erasing 2015’s Gains as Oil Spurs Inflation Risk

The ruble weakened past 60 against the dollar for the first time since March, tracking the price of oil and raising the likelihood that Russia’s central bank will hold off on cutting interest rates this week. The currency fell 1.1 percent to 60.32 per dollar by 10:23 a.m. in Moscow. Government bonds known as OFZs fell for a seventh day, with the yield on five-year securities climbing nine basis points to 11.17 percent. The ruble is less than 1 percent away from erasing this year’s gains after posting five straight weekly drops, potentially spurring the cost of imports and jeopardizing the Bank of Russia’s efforts to curb inflation. This presents a “difficult choice” to policy makers before they meet to decide on interest rates on July 31, according to Capital Economics. The central bank has lowered rates four times this year to support the slowing economy. “On the one […]

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BP Swings to Second-Quarter Loss on Lower Oil Price, Deepwater Horizon Deal

BP fell to a loss in the second quarter. LONDON— BP BP -1.42 % PLC on Tuesday swung to a loss in the second quarter, as earnings were hit by lower oil prices and a multibillion-dollar charge relating to the deal it reached earlier this month to settle U.S. federal and state claims over the 2010 Deepwater Horizon disaster. The U.K. oil giant said its replacement cost loss—a number analogous to the net income that U.S. oil companies report—was $6.27 billion, compared with a profit of $3.18 billion a year earlier. The sharp decline includes a $9.8 billion pretax charge that BP recorded as part of an $18.7 billion agreement with the U.S. government and five states to settle legal claims relating to its Deepwater Horizon fatal oil spill in the Gulf of Mexico. The net charge recorded by the company for nonoperating items amounted to $7.5 billion. It […]

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BP Has Worst Profit in 10 Years on Libya Write-Off, Trading

BP Plc reported the lowest quarterly profit in at least 10 years after a boom in trading faded and the conflict in Libya forced almost $600 million of writedowns. Profit adjusted for one-time items and inventory changes dropped to $1.3 billion in the second quarter, 64 percent lower than a year earlier, the London-based company said Tuesday in a statement. That missed the $1.7 billion average estimate of 17 analysts surveyed by Bloomberg. “I am confident that positioning BP for a period of weaker prices is the right course to take” The weaker-than-expected results pile pressure on Chief Executive Officer Bob Dudley to cut capital spending to maintain dividends. The company is no longer benefiting from the strong trading that added about $350 million to profit in the first quarter, while a halt to operations in Libya eroded earnings from oil and gas exploration. “The miss is primarily because […]

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41 more North Sea oil, gas licenses announced

An offshore oil rig in the North Sea. Photo by I. Newton/Wikimedia LONDON, July 27 (UPI) — The United Kingdom Oil and Gas Authority (OGA) announced 41 new licenses Monday to explore the U.K. Continental Shelf in the North Sea. An additional 134 licenses were awarded in November 2014. The total of 175 licenses makes the round of applications among the largest since the licensing process began in 1964. "The U.K. Continental Shelf remains a world-class hydrocarbon province where significant resources and economic value remain to be realized. The good level of interest in the 28th round highlights the continued attractiveness of the U.K.’s oil and gas resources. Licenses are, however, just a start and industry, government and the OGA now need to work together to revitalize exploration activity across the basin and convert licenses into successful exploration wells," OGA Chief Executive Andy Samuels said in a statement Monday. […]

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Oil prices fall on oversupply worries; investors await Fed meeting

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Oil prices fell on Monday after closing the previous session at their lowest levels since March on renewed oversupply concerns from the United States and Iraq, although a weaker dollar helped to limit deeper losses. Investors are looking to the U.S. Federal Reserve for direction this week. The central bank starts a two-day policy meeting on Tuesday that could result in a September interest rate hike that would strengthen the greenback. "The markets are looking for price guidance from Janet & Co," said Ben Le Brun, market analyst at Sydney’s OptionsXpress, referring to Fed Chair Janet Yellen and the bank. "There is scope for the dollar bulls to be disappointed this week (which) might be a driver for oil prices and the commodities complex overall," Le Brun said. A weaker dollar makes dollar-denominated commodities, including oil, […]

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Oil Bulls Flee at Fastest Pace in Three Years as Glut Expands

Speculators’ conviction that oil will rally weakened at the fastest pace in three years, just before futures tumbled into a bear market. The net-long position in West Texas Intermediate contracted 28 percent in the seven days ended July 21, U.S. Commodity Futures Trading Commission data show. Long positions dropped to a two-year low while short holdings climbed 25 percent. Oil traded in New York fell more than 20 percent from its June high, meeting the common definition of a bear market. U.S. output has held near a four-decade high while the largest OPEC members pump at record rates, keeping the market oversupplied. The drop was part of a broader retreat in commodity prices to a 13-year low, driven by concern that slower economic growth in China and a stronger dollar will hurt demand. “Supply is still in excess of what would balance the market,” Katherine Spector, a commodities strategist […]

Posted On : Published By : Tom Whipple