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US EPA unveils Methane Challenge to entice ‘ambitious’ emissions reductions

A proposed framework for a program seeking voluntary methane reduction and reporting commitments from oil and natural gas companies was met with cautious optimism by industry groups, while environmentalists said the program would not do enough to curb emissions. The voluntary Natural Gas STAR Methane Challenge Program, which the US Environmental Protection Agency proposed, is designed to recognize companies going above and beyond existing voluntary actions. EPA said Thursday that participation would be limited to those looking to achieve "ambitious" methane reduction goals, transparently track and account for their progress and demonstrate continuous improvement over time. The agency touted the program’s emphasis on meaningful and transparent commitments yielding "significant methane emissions reductions in a quick, flexible, cost-effective way." But industry groups are more skeptical about the proposal. Oil and gas groups expressed interest in working with EPA on the program, but also noted emission-reduction successes already seen, based on […]

Posted On : Published By : Tom Whipple
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This Is Why A Serious Decline In U.S Shale Plays Is Not Far Away

The plunge in oil prices last year led many to say that a decline in U.S. oil production wouldn’t be far behind. This was because almost all the growth in U.S. production in recent years had come from high-cost tight oil deposits which could not be profitable at these new lower oil prices. These wells were also known to have production declines that averaged 40 percent per year. Overall U.S. production, however, confounded the conventional logic and continued to rise– until early June when it stalled and then dropped slightly. Anyone who understood that U.S. drillers in shale plays had large inventories of drilled, but not yet completed wells, knew that production would probably rise for some time into 2015– even as the number of rigs operating plummeted. Shale drillers who are in debt–and most of the independents are heavily in debt–simply must get some revenue out of wells […]

Posted On : Published By : Tom Whipple
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Greek PM Tsipras under pressure over covert Syriza drachma plan reports

Greek Prime Minister Alexis Tsipras in Athens, Greece July 24, 2015. Some members of Greece’s leftist government wanted to raid central bank reserves and hack taxpayer accounts to prepare a return to the drachma, according to reports on Sunday that highlighted the chaos in the ruling Syriza party. It is not clear how seriously the plans, attributed to former Energy Minister Panagiotis Lafazanis and former Finance Minister Yanis Varoufakis, were considered by the government and both ministers were sacked earlier this month. However the reports have been seized on by opposition parties who have demanded an explanation. The reports came at the end of a week of fevered speculation over what Syriza hardliners had in mind as an alternative to the tough bailout terms that Tsipras reluctantly accepted to keep Greece in the euro. Around a quarter of the party’s 149 lawmakers rebelled over the plan to pass sweeping […]

Posted On : Published By : Tom Whipple
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Investors Flee Russia as Morgan Stanley Sees Long Market Chill

Russia’s cooling market climate has spurred an exodus of international investors. And the forecast calls for the cold snap to linger. A worsening outlook for the price of crude, the country’s biggest export, and international sanctions that are pushing Russia toward its first recession since 2009 have prompted money managers at Franklin Templeton Investments and BNP Paribas SA to retrench. With the world’s largest energy exporter so dependent on oil, which along with natural gas accounts for half its budget revenue, Morgan Stanley predicts “a long winter” absent any other growth drivers. “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, said in an interview at Bloomberg headquarters in New York. “It’s a stability, but stability with stagnation. I don’t know how long they can coexist, but this […]

Posted On : Published By : Tom Whipple
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Nonlinear: New York, London, Shanghai underwater in 50 years?

Those under the impression that climate change is advancing at a constant and predictable rate don’t understand the true dynamics of the issue. The rate of increase of the carbon dioxide concentration in the atmosphere, the main driver of climate change, went from 0.75 parts per million (ppm) per year in 1959 to about 1.5 ppm each year through the 1990s, to 2.1 ppm each year from 2002 to 2012, and finally to 2.9 ppm in 2013. The fear is that the ability of the oceans and plants to continue to absorb half the carbon dioxide human civilization expels into the atmosphere each year may have become impaired. That means more carbon dioxide is remaining in the atmosphere where concentrations are building at the fastest rate ever recorded in the modern era. Permafrost across the most northern reaches of land on the globe wasn’t expected to start melting until […]

Posted On : Published By : Tom Whipple
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Oil prices climb, but stay in bear market territory

Stacked rigs are seen along with other idled oil drilling equipment at a depot in Dickinson, North Dakota June 26, 2015. Oil prices edged up on Friday after closing at their lowest in months in the previous session as oversupply and disappointing Chinese factory activity dragged on the market. Oil prices in the United States have slumped more than 20 percent in the past six weeks, a slide considered by many traders to constitute a bear market. The oil demand outlook dimmed further on Friday after a preliminary private survey showed factory activity in China’s struggling economy contracted by the most in 15 months in July. "Concerns around the demand environment were heightened further today by the PMI (Purchasing Managers’ Index) read out of China," said Michael McCarthy, chief market strategist at CMC Markets in Sydney. "The lack of supply side response means that the downtrend looks to be […]

Posted On : Published By : Tom Whipple
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Saudi Arabia Having to Borrow Billions – Could Be Bankrupt by End of the Decade

Over the past year, Saudi Arabia – once among the richest nations on the planet – has wound up having to sell some $4 billion in bonds. It has been necessary in order to maintain levels of spending on public works and continue financing the war against Yemen. The Saudi government has also had to draw on its reserves of foreign currency. Falad al-Mubarak, who heads the Saudi Arabian Monetary Agency (the nation’s equivalent of the U.S. Federal Reserve), predicts “an increase in borrowing” in the face of a projected $130 billion deficit. The primary cause is the drastic decline in the price of crude oil. Since hitting a peak of around $125 in February 2011, the price of a barrel of oil is currently under $50. It’s not going to get better anytime soon. Oil company executives predict it may be years before petroleum prices rebound. In order […]

Posted On : Published By : Tom Whipple
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Turkey Attacks Kurdish Militant Camps in Northern Iraq

ISTANBUL — Turkish fighter jets, which on Friday attacked Islamic State targets in Syria , have launched a wave of airstrikes in northern Iraq , targeting camps of the militant Kurdistan Workers’ Party for the first time in four years, the prime minister’s office said Saturday. The Iraq incursion, which began late Friday and continued into Saturday, effectively ended an unstable two-year cease-fire between the Turkish government and the Kurdish militants, known by the initials P.K.K. After 30 years of conflict that claimed at least 40,000 lives, the two sides reached a fragile peace in 2013, though there have been a few minor clashes since then. Fighter jets also struck Islamic State targets in Syria for a second night, Prime Minister Ahmet Davutoglu’s office said in the statement Saturday. The jets entered Syrian airspace to do so, the statement said, unlike during the previous strikes , which the government […]

Posted On : Published By : Tom Whipple
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Commodity Collapse Isn’t Slowing Down Amid Worst Week of 2015

The commodity collapse that sent gold to a five-year low and pulled crude oil into a bear market isn’t showing any signs of slowing down. The Bloomberg Commodity Index fell 4.3 percent this week, the most since November, and extended a drop to a 13-year low. Shares of Freeport-McMoRan Inc., the biggest publicly traded copper producer, are poised for the worst week since 2011 as the metal dropped to a six-year low in New York. Brent oil is on its way to the longest run of weekly declines since January. Fresh evidence of the slowdown in China, the world’s top consumer of metals, grains and energy, helped prices extend losses on Friday. The Bloomberg commodity measure has tumbled about 28 percent over the past year amid expanding gluts. Investors are still holding a net-long position, or bets on a price gain, across raw materials. They increased those wagers in […]

Posted On : Published By : Tom Whipple