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US Says Shell Is Not Yet Allowed To Drill In Arctic Oil Zone

WASHINGTON, July 22 (Reuters) – The U.S. Interior Department on Wednesday granted Royal Dutch Shell two final permits to explore for crude in the Arctic this summer, but said the company cannot drill into the oil zone until required emergency equipment arrives in the region. The department’s Bureau of Safety and Environmental Enforcement (BSEE) conditionally granted Shell permits for exploration in the Chukchi Sea off Alaska, in a season which sea ice limits from July until October. But Shell must have emergency equipment to contain a potential blown-out well deployable within 24 hours before drilling into the oil zone, the office said. Shell discovered weeks ago that the Fennica icebreaker that holds the required equipment, called a capping stack, had a three-foot (1-meter) gash in it. "Without the required well control system in place, Shell will not be allowed to drill into oil-bearing zones," BSEE Director Brian Salemo said. […]

Posted On : Published By : Tom Whipple
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Solar Desalination Could be a Game Changer for California Farms

Let’s be clear from the outset: I’m no fan of conventional desalination. The idea of using climate-altering fossil fuels to drive an energy-intensive de-salting process that threatens coastal environments in order to produce drinking water that, in most cases, could be secured more cheaply through conservation and efficiency improvements, simply fails to pass the bar of economically sensible, environmentally sound solutions to our water problems. But now desalination of a very different stripe is under way – not by the sea, but in California’s drought-stricken Central Valley farming region. The project is turning salty, contaminated agricultural drainage into fresh water that can be re-used to irrigate crops. Powered not by fossil fuels, but by the sun, the technology has the potential to shift the way water is used and managed in parts of the west, where agriculture accounts for 70-80 percent of water use. Developed by a San Francisco-based […]

Posted On : Published By : Tom Whipple
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Russia’s Missed Debt-Sale Goal Shows Rate-Cut Bets Went Too Far

Russia raised less money than targeted at a debt auction as demand for one series of bonds offered fell to the lowest level since April, the latest sign investors are scaling back bets for interest-rate cuts.. The nation sold 9.82 billion rubles ($172 million) of local debt, known as OFZs, after tendering 15 billion rubles of notes maturing in five and 13 years. While bids exceeded the amount offered, investors’ yield demands were higher than the government was willing to pay following a four-week rally in sovereign bonds. Those gains came to an end this week as investors speculated the impact of potential interest-rate cuts is already factored into prices. The Bank of Russia will make its next decision on borrowing costs on July 31 and Kapital Asset Management expects policy makers will hold off on changing them amid concern inflation isn’t falling fast enough to justify lower interest […]

Posted On : Published By : Tom Whipple
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Greek PM keeps lid on party rebellion to pass bailout vote

Anti-austerity demonstrators hold up a giant Greek flag in front of parliament in Athens, July 22, 2015. Greek Prime Minister Alexis Tsipras contained a rebellion in his left-wing Syriza party to win parliamentary approval on Thursday for a second package of reforms required to start talks on a financial rescue deal. A first set of reforms that focused largely on tax hikes and budget discipline triggered a rebellion in Syriza last week and passed only thanks to votes from pro-EU opposition parties. The bill that lawmakers voted on early Thursday covered rules for dealing with failed banks and speeding up the justice system – two more conditions set by the euro zone and IMF to open negotiations on an 86 billion euro rescue loan. The legislation easily passed with the backing of 230 votes in the 300-seat chamber, once again due to opposition support. But 36 Syriza deputies – […]

Posted On : Published By : Tom Whipple
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Gazprom Neft Leads Russian ADRs Lower as Crude Extends Decline

OAO Gazprom Neft tumbled the most in seven weeks, leading a slump in U.S.-traded Russian stocks as crude prices extended their decline from this year’s high, prompting investors to withdraw from the world’s largest energy exporter. The oil producer’s American depositary receipts sank 3.8 percent to $11.80 in New York. Trading volume was more than 4 times the daily average of the past three months. It was the worst performance in the Bloomberg Russia-US Equity Index, which slid to a two-week low. Stocks declined as Brent crude, which traders use to price the country’s main export blend, fell 1.6 percent to $56.13, pushing the decline from its May 6 high to 17 percent. Oil, which is selling at about three-fifths its five-year average price, is the country’s biggest export and, along with natural gas, accounts for about half its budget revenue. Lower prices, combined with sanctions linked to the […]

Posted On : Published By : Tom Whipple
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EU extends loan to assist with Ukrainian reforms

European Commissioner extends assistance to Ukraine to help with energy and financial sector reforms. Photo by canadastock/Shutterstock BRUSSELS, July 22 (UPI) — The European Commission said Wednesday it agreed to extend financial assistance to Ukraine, a key energy transit country, to help with economic reforms. The commission, acting on behalf of the European Union, said it disbursed $650 million in assistance to Ukraine to address "urgent financing needs" necessary for economic stability . The loan is aimed at steering Ukraine through energy and financial sector reforms. "Through this financial assistance, the EU is proud to support the courageous reform agenda pursued by the government," Valdis Dombrovskis, European commissioner for the euro, said in a statement. "I am confident that the implementation of those ambitious reforms will help Ukraine exploit its many assets to the full, so as to foster strong and sustainable economic growth for the benefit of all […]

Posted On : Published By : Tom Whipple
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Nine Reasons Why Low Oil Prices May “Morph” Into Something Much Worse

Why are commodity prices, including oil prices, lagging? Ultimately, it comes back to the question, “ Why isn’t the world economy making very many of the end products that use these commodities? ” If workers were getting rich enough to buy new homes and cars, demand for these products would be raising the prices of commodities used to build and operate cars, including the price of oil. If governments were rich enough to build an increasing number of roads and more public housing, there would be demand for the commodities used to build roads and public housing. It looks to me as though we are heading into a deflationary depression, because prices of commodities are falling below the cost of extraction. We need rapidly rising wages and debt if commodity prices are to rise back to 2011 levels or higher. This isn’t happening. Instead, Janet Yellen is talking about […]

Posted On : Published By : Tom Whipple
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Oil prices fall as industry data shows U.S. crude stocks rising

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Oil prices fell on Wednesday after industry data showed U.S. crude inventories rose last week when they had been expected to drop, even as a weaker dollar helped to limit deeper losses. Crude futures have steadied this week after tumbling to three-months lows earlier in July on concerns that higher Iranian exports would add to an oversupplied market. U.S. crude held above $50 a barrel on Wednesday after dipping below that mark this week for the first time since early April. By 0657 GMT (2.57 a.m. EDT), West Texas Intermediate (WTI) for September delivery CLc1 was trading 60 cents lower at $50.26 a barrel, after closing 42 cent higher in the previous session. The WTI August contract CLQ5, which expired on Tuesday, settled at $50.36 a barrel on its last day of trade, after slipping as […]

Posted On : Published By : Tom Whipple
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U.S. Oil Prices Struggle to Rise Above $50

A truck drives past pump jacks at an oil field in Bashkortostan, Russia. Oil prices remained under pressure in Asian trade Tuesday, with U.S. oil prices struggling to move above the $50 mark amid persistent concerns over a global oil glut . A stronger U.S. dollar is also weighing on oil prices after the ICE U.S. dollar index hit a three-month high on Monday, triggering a selloff across commodities as investors shifted to other asset classes. On the New York Mercantile Exchange, light, sweet crude futures for delivery in August traded at $50.00 a barrel at 0304 GMT, down $0.15 in the Globex electronic session. It lost 1.5% in the previous session, falling to a near four-month low of $50.15 a barrel. September Brent crude on London’s ICE Futures exchange fell $0.10 to $56.55 a barrel. Nymex crude has fallen for four consecutive trading sessions and is down around […]

Posted On : Published By : Tom Whipple
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Oil gains after choppy trade, U.S. Aug crude expires above $50

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Crude oil futures held on to gains after a volatile session that saw the U.S. front-month August contract expire and go off the board above $50 a barrel, with a weaker dollar providing support. Weak U.S. RBOB gasoline futures helped curb gains for crude, especially Brent, traders said, as expectations that inventories rose again last week weighed on prices. The dollar .DXY retreated from a three-month high against a basket of currencies on mild profit-taking and as the euro rebounded as traders pared bearish bets as Greece started to adopt measures to avert bankruptcy. [USD/] A rising dollar makes it more profitable for non-U.S. investors to sell dollar-denominated assets and a weaker greenback makes oil less expensive for consumers using other currencies. Expectations of more Iranian supply following last week’s agreement on Tehran’s nuclear program and […]

Posted On : Published By : Tom Whipple