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Russia May Halt Monetary Easing If Oil at $40, Kremlin Aide Says

Russia’s central bank may pause its monetary easing cycle if oil prices fall to $40 a barrel, Kremlin economic aide Andrey Belousov said in an interview. “If the situation on the foreign-exchange market changes as a result of a significant drop in oil prices — to $40 a barrel, with fluctuations between $40 and $45 — then the central bank will probably halt the process of cutting the rate,” Belousov said by phone on Tuesday. The rout on commodities markets may force the central bank to change tack if it reignites inflation and further destabilizes the ruble, which is trading at a six-month low. Policy makers led by Elvira Nabiullina have lowered their benchmark interest rate by a cumulative six percentage points to 11 percent in five steps this year after an emergency increase in December. Belousov, a former economy minister who replaced Nabiullina as President Vladimir Putin’s aide […]

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London opening oil and gas doors

British government reviewing potential onshore leases in an effort to accelerate shale oil and gas development. Photo by David Gaylor/Shutterstock LONDON, Aug. 18 (UPI) — With a potential for growth in the fledgling shale sector, the British government said Tuesday it was expecting bidders for new onshore oil and gas acreage. "As part of our long-term plan to build a more resilient economy, create jobs and deliver secure energy supplies, we continue to back our onshore oil and gas industry and the safe development of shale gas in the U.K.," British Energy Minister Nick Bourne said in a statement. More than 100 sites could be available after review of environmental consultation laws. The industry’s regulator, Oil and Gas Authority, said around two dozen of those were formally on the auction block already. The government cautioned that no licenses were issued. Instead, the companies behind the 27 sites released will […]

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Scotland examines next steps after coal plant closure

The Scottish government blames British policies for pushing utility company to decide to close coal-powered plant next year. File Photo by Stephen Shaver/UPI EDINBURGH, Scotland, Aug. 18 (UPI) — The Scottish government said Tuesday it was setting up a panel to look into the impact of the closure of the Longannet coal power plant, the country’s last. "ScottishPower’s decision to close Longannet in March 2016 is deeply regrettable and has far-reaching consequences for Scotland," Scottish Energy Minister Fergus Ewing said in a statement. "This is a worrying time for Longannet workers, and the Scottish government and its agencies will do everything possible to support the 230 directly employed staff who will be affected by this announcement." The utility said the combination of high carbon taxes and high transmission charges meant it had to shut down the coal plant by next year. With 46 years in service, Longannet is the […]

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Fighting Intensifies Along Eastern Ukraine Cease-Fire Line

Photo A house destroyed in heavy fighting between Ukrainian government forces and Russian-backed separatists in the village of Sartana, near Mariupol, in eastern Ukraine. Credit Sergey Vaganov/European Pressphoto Agency MOSCOW — Fighting between government forces and Russian-backed rebels in eastern Ukraine has escalated sharply in recent days, with each side blaming the other for the violence. At least nine people were killed in artillery strikes on Monday in villages and towns on both sides of a cease-fire line, and United States officials have said that one three-day period of fighting along the front last week was the most intense since a February cease-fire . Neither side has openly renounced the cease-fire, but European monitors of the accord say both have been pulling heavy weapons out of storage sites and putting them to use. The United States State Department blamed Russia and pro-Russian rebels for the uptick in violence. American […]

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A Must Read: Guest Post by Ian Walker – ”The End of the Fossil Fuel Age”

THE END OF THE FOSSIL FUEL AGE Big Oil, Saudi Arabia,the merchant banks and markets all think fossil fuel has had its day, a bold statement, where is the evidence for it? If you had been taking any notice you would have seen Big Oilhave been selling of their Oil Fields and getting out of the oil field asset ownership market since September 2011. Is what I am writing true? Why would they believe the Fossil Fuel Age has ended? It is basic due diligence to find out what the big players are doing. So do a Google search for any oil company name and the phrase ”Oil field” and the words divest or sell. You will see evidence like the following: SHELL Shell has been on a massive divestment strategy on its oil field assets, from Africa to the Far East since September 2011, though as it was […]

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U.S. oil prices near six-year lows as China weighs

A drop of diesel is seen at the tip of a nozzle after a fuel station customer fills her car’s tank in Sint Pieters Leeuw December 5, 2014. Wholesale petrol prices have slumped by 35.5 percent since reaching their peak for the year in June, but in more than half of European… U.S. oil prices fell toward six-year lows on Tuesday after stock markets tumbled in China, the world’s largest energy consumer, adding to worries about global fuel demand at a time of heavy oversupply. Chinese stocks fell 6 percent on Tuesday as the yuan weakened against the dollar, raising fears that Beijing may further devalue the currency. Such a move could decrease China’s consumption and import levels. Industrial metals, including copper, also traded near six-year lows, adding to bearish market sentiment. "That is dragging oil lower – it was in bearish territory to start with," SEB chief commodity […]

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Oil Price Starts the Week in the Red

The oil price kicked off the week in the red as the market remained under selling pressure, with U.S. oil prices dropping below $42 a barrel. On Friday, oil-field services firm Baker Hughes Inc. BHI 0.76 % said that the number of rigs drilling for oil in the U.S. rose for the fourth straight week. This added to fears on the market that the global glut of oil, which has battered prices since last year, isn’t going away anytime soon. “We have concerns about crude fundamentals and prices in the second half of 2015 and 2016,” analysts at Morgan Stanley MS 0.79 % said in a report. “As a result, we see Brent range-bound through [that period].” Brent crude, the global oil benchmark, fell 1.2% to $48.61 a barrel on London’s ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 1.7% at […]

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What might prompt a short-covering rally in U.S. oil price? Kemp

Hedge funds remained unusually bearish on U.S. oil prices last week even as the cost of WTI tumbled towards the lowest level since 2009. Hedge funds and other money managers held short positions in WTI-linked futures and options equivalent to more than 193 million barrels of oil, according to the U.S. Commodity Futures Trading Commission. Money managers had never held a short position that large before, except for a brief period in March, when U.S. crude stockpiles were rising fast and there were fears storage space would run out. More hedge funds expect prices to rise than the number predicting a fall, and the oil bulls have a larger position overall, amounting to nearly 310 million barrels. But the ratio of hedge fund long to short positions in WTI is just 1.6:1, down from 4.6:1 in the middle of May, and the lowest in almost five years ( link.reuters.com/vyk45w […]

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OPEC May Boost Oil Output to Record With Iran Back Amid Glut

(Bloomberg) — OPEC could potentially boost crude oil production to 33 million barrels a day, the most ever, after international sanctions are removed against Iran amid a global supply glut, according to the country’s OPEC representative. The global oil market is already in surplus by about 3 million barrels a day, with Saudi Arabia and Iraq responsible for OPEC’s oversupply in the past six months, Iran’s state-run Islamic Republic News Agency reported Sunday, citing Mehdi Asali. Iran can boost output by 500,000 barrels a day within one week after sanctions are lifted, Oil Minister Bijan Namdar Zanganeh said earlier this month. Crude has lost half its value in the past year as U.S. production jumped to the highest level in more than 40 years and Saudi Arabia had record output. Prices collapsed after the Organization of Petroleum Exporting Countries decided on Nov. 27 to maintain production rather than sacrifice […]

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Lobbying Fight Over Iran Nuclear Deal Centers on Democrats

Photo President Obama played golf last week in Martha’s Vineyard, but he has also been calling members of Congress, an official said. Credit Steven Senne/Associated Press WASHINGTON — From his rented vacation home on Martha’s Vineyard with sweeping views of the Atlantic Ocean, President Obama has been making phone calls to Democratic members of Congress, trying to rally support for the nuclear deal with Iran that faces a vote next month. “If you support the deal, we’d like you to make that clear,” he tells the lawmakers, according to a White House official who would describe the private calls only on condition of anonymity. “And if you still have concerns, we want to be able to answer those questions.” The personal appeals from the president are part of an orchestrated lobbying effort by the White House, supported by a coalition of antiwar and progressive organizations, aimed at persuading Democrats […]

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Kurdistan presidency controversy deepens

KRG President Masoud Barzani gives an interview in Erbil on June 2, 2013. (AZAD LASHKARI/Reuters) Kurdistan’s political crisis over the tenure and powers of President Massud Barzani is deepening, with the head of Parliament vowing to press ahead with new legislation that would reconfigure how the region is governed.Barzani’s final term in office expires midnight Wednesday. Kurdistan’s regional Parliament has scheduled a final reading that day of a draft law that, if passed, would strip Barzani of much of his power and make the president electable by MPs.The legal picture clouded… This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

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Saudi Growth to Slow as Kingdom Adjusts to Cheaper Oil, IMF Says

Economic growth in Saudi Arabia is set to slow this year and next as the government is forced to reduce spending to compensate for lower oil prices, the International Monetary Fund said on Monday. Saudi Arabia’s gross domestic product will grow by 2.8 percent this year and 2.4 percent in 2016, the IMF said in e-mailed statement at the conclusion of its regular country consultation. That compares with 3.5 percent growth last year. Growth may expand to 3 percent in the “medium term,” it said. The world’s largest oil producer turned to the bond market this year for the first time since 2007 after oil prices fell by over 50 percent. The resulting budget deficit, which the IMF projects at 19.5 percent of GDP, may force Saudi rulers to abandon the kingdom’s traditional largess. Saudi Arabia needs “comprehensive energy price reforms, firm control of the public sector wage bill, […]

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Saudi-led coalition bombs Yemen ‘aid port’ Hodeida

Jets from a Saudi-led coalition targeted rebel Houthi positions in Yemen’s Red Sea port of Hodeida early on Tuesday, port officials said, destroying cranes and warehouses at a main import hub for critical aid supplies to the country’s north. There were also clashes further south overnight in Yemen’s third city, Taiz, Arab television stations reported, as local groups opposed to the Houthis attempted to consolidate recent advances to take the city. As well as retaining a foothold in Taiz, the Houthis and allied army units loyal to former president Ali Abdullah Saleh control the northern highlands and Red Sea coastal plain as far south as Ibb, where coalition-backed forces advanced last week. Ibb is around 50 kilometers (30 miles) north of Taiz and 200 kilometers southeast of Hodeida. The port, which lies almost due west of the capital Sanaa, has become a focal point of Yemen’s humanitarian crisis, which […]

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Strong Dubai crude oil trades skew Asia price benchmark

Oil tanks are seen at a Sinopec plant in Hefei, Anhui province, May 31, 2009. Record trading of Dubai crude by two Chinese state companies this month on a decades-old oil pricing system has pushed the benchmark higher, even as other grades are being pressed lower by a global glut. The strong Dubai trade has forced Middle East producers to raise official selling prices (OSPs), driving Asian buyers to seek cheaper oil elsewhere or cut refinery runs due to low margins. Chinaoil and Unipec, trading units of PetroChina and Sinopec, respectively, traded record volumes of crude in early August on pricing agency Platts’ market assessment process. This pushed up prompt physical Dubai prices against future months, creating a backwardated market structure usually associated with supply shortages. In contrast, a global oil glut has kept Brent and West Texas Intermediate (WTI) crude futures in contango this year, and most analysts […]

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ISIL ‘brutally’ quells rebellion in Libya’s Sirte

ISIL fighters crushed the revolt by the rival group and armed residents trying to break its grip on the city of Sirte. [Al Jazeera] The Islamic State of Iraq and the Levant (ISIL) has brutally quelled a rebellion in the Libyan city of Sirte by citizens who took up arms to try to push back the armed group, residents have said. Witnesses said the group was now calling on residents to pledge allegiance over loudspeakers from its main mosque and desecrating bodies of their adversaries. Sources in the city told Al Jazeera on Monday that clashes broke out five days earlier between ISIL and armed residents in the city’s Number Three neighbourhood, before ISIL besieged it and began shelling it with heavy weaponry. By Monday, the neighbourhood was under the full control of ISIL, the sources said. Cleric Khalid Awad said that ISIL had killed some of their prisoners […]

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Israel opening offshore gas doors

Israeli Prime Minister Benyamin Netanyahu praises vote that would clear the way toward full exploitation of nation’s offshore natural gas reserves. File Photo by UPI Photo/Debbie Hill. JERUSALEM, Aug. 17 (UPI) — An Israeli decision to exploit offshore natural gas reserves is an important milestone for the nation’s economy, the country’s prime minister said. Prime Minister Benjamin Netanyahu expressed support after members of government cleared the way toward full development of offshore natural gas reserves. "We need to extract the gas from the sea," the prime minister said in a statement. "The gas will be extracted from the bottom of the sea and will reach Israeli citizens, Israeli industry and the Israeli economy – for the benefit of the citizens of Israel." The Israel Antitrust Authority had ruled that Israeli energy company Delek Group and its partners at Noble Energy, which has headquarters in Texas, control all of the […]

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Algeria Calls for Non-OPEC Output Cut to Stop Oil Price Slump

The Organization of Petroleum Exporting Countries can do little to halt the oil price decline on its own and needs producers from outside the group to help in reducing global supplies, Algeria’s Energy Minister said. “A supply reduction by OPEC alone cannot really guarantee a return to oil market stability,” Salah Khebri said at an event in Algiers, according to Liberte newspaper. As the 12-member group of crude producing nations accounts for 40 percent of the world’s supply, “there should be steps taken within OPEC and with non-OPECs.” Khebri called earlier this month for an OPEC emergency meeting because of the continued decline in oil prices, which dropped by half from a year ago amid rising production from the U.S. Oil and gas sales account for about 60 percent of Algeria’s budget revenue and 95 percent of its export income, according to the International Monetary Fund. Algeria’s initiative to […]

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Nigeria’s Crude Oil Exploration, Production Hit Record Low

The nation’s crude oil exploration and production activities may have hit a record low, going by the latest report from the Nigerian National Petroleum Corporation (NNPC). Specifically, only Shell Petroleum Development Company (SPDC) and Addax carried out exploration/drilling activities during the month of March, according to available data from NNPC’s monthly report obtained by The Guardian yesterday. The country has been recording low production activities since November last year, as several oil and gas firms began scaling down production due to the uncertainties surrounding the Petroleum Industry Bill (PIB) and the declining crude oil prices. Many oil and gas firms have also been recording losses, which made them to resort to cancelling or deferring projects. According to OPEC in its monthly oil market report, among member countries, Nigeria recorded the second sharpest drop in rig counts in March with production of 1.69mbpd in the month compare to the 2.21mbpd […]

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Exclusive: U.S. graft probes may cost Petrobras record $1.6 billion or more – source

A fuel storage tank is seen at the company Petroleo Brasileiro SA, or Petrobras, in Sao Caetano do Sul, near Sao Paulo July 24, 2015. Brazil’s Petrobras may need to pay record penalties of $1.6 billion or more to settle U.S. criminal and civil probes into its role in a corruption scandal, a person recently briefed by the company’s legal advisors told Reuters. State-run Petroleo Brasileiro SA, as the company is formally known, expects to face the largest penalties ever levied by U.S. authorities in a corporate corruption investigation, according to the person, who has direct knowledge of the company’s thinking. The settlement process could take two-to-three years, this person said. To date, the largest settlement of corporate corruption charges with the U.S. Department of Justice and the U.S. Securities and Exchange Commission was a 2008 agreement with Siemens AG, the German industrial giant. It agreed to pay the […]

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China’s Devaluation of Its Currency Was a Call to Action

Photo Across China, millions of workers and thousands of companies are feeling the pain of the country’s slowing economy, as sales slip and incomes drop. Credit Adam Dean for The New York Times HONG KONG — When Prime Minister Li Keqiang convened the Chinese cabinet last month, the troubled economy was the main topic on the agenda. The stock market had stumbled after a yearlong boom. Money was flooding out of the country. Most ominously, the country’s export machine had stalled, prompting a wave of labor strikes. In a little-noted advisory to government agencies, the cabinet said it was essential to fix the export problem, and the currency had to be part of the solution. With the government keeping a tight grip on the value of the renminbi, Chinese goods were more expensive than rivals’ products overseas. The currencies of other emerging markets had fallen, and China’s exporters could […]

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China stocks slump 6 percent on fears of further yuan depreciation

An investor looks at an electronic board showing stock information at a brokerage house in Hangzhou, Zhejiang province, China August 18, 2015. Chinese stocks plunged on Tuesday as the yuan weakened against the dollar, reigniting fears that Beijing may be intent on a deeper devaluation of the currency despite the central bank’s comments that it sees no reason for a further slide. Concerns that companies may pull more money out of China as the economy slows and speculation that the government may begin to scale back its massive support for the country’s stock markets also prompted investors to take profits after a run-up in prices over the last few weeks, traders said. The Shanghai Composite Index .SSEC closed down 6.1 percent at 3,749.12 points in its biggest daily decline since July 27, snapping a three-day winning streak. The CSI300 index .CSI300 of the largest listed companies in Shanghai and […]

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China Shares Tumble 6.2%

Fresh anxieties about China’s commitment to steadying the stock market sparked heavy losses in Shanghai Tuesday, despite signals of a housing recovery and the central bank’s latest steps to keep cash from fleeing. The Shanghai Composite Index tumbled 6.2% to 3748.16, just 240 points above its recent trough on July 8 and 27% off its June peak. The smaller Shenzhen Composite Index fell 6.6% to 2174.42. In Hong Kong, shares fell 1.4%, turning negative for the year, and a gauge of Chinese companies listed in the city fell 1.8%. Losses among stocks of state-owned enterprises in Shanghai started building earlier in the morning amid skepticism about Beijing’s commitment to reform . Reports of efforts to accelerate reform, long touted as a way to open up bulky conglomerates to private investment and market forces , had gained momentum in recent weeks and buoyed related stocks. “At 2 p.m. it started […]

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EPA to Propose Rules Cutting Methane Emissions From Oil and Gas Drilling

WASHINGTON—The U.S. Environmental Protection Agency on Tuesday will propose the first-ever federal regulations to cut methane emissions from the nation’s oil and natural-gas industry, according to people familiar with the move, which is part of President Barack Obama’s climate agenda. The EPA is expected to propose regulations aimed at cutting methane emissions from the oil and gas sector by 40% to 45% over the next decade from 2012…

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China Focus: Economists confident of medium-term 7-percent growth

BEIJING, Aug. 18 (Xinhua) — Economists have high hopes China can keep GDP growth above 7 percent over the next five years, as leading officials prepare to discuss 2016-2020 development at a key political meeting. Economic growth is high on the agenda of October’s plenary session of the Communist Party of China Central Committee, which will cover the 13th Five-year Plan (2016-2020). These five years are critical if Chinese leaders are to realize their goals of doubling 2010 GDP and per capita income and completing the building of a moderately prosperous society by 2020. "China’s potential growth can exceed 7 percent," said Tsinghua University economist Hu Angang, using the technical term for the maximum pace an economy can sustain over the medium to long term without stoking inflation. "China set a growth target of 7 percent for the 2011-2015 period, but the de facto annual growth was 7.8 percent […]

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Brace for More Dividend Cuts in Canada Oil Patch

Dividend cuts among Canadian energy producers are poised to accelerate as cost reductions fail to boost shrinking cash flow. Companies from Canadian Oil Sands Ltd. to Baytex Energy Corp. are in line for deeper payout decreases, according to analysts, after Crescent Point Energy Corp. slashed its dividend for the first time last week as crude sank to a six-year low. Just 38 percent of the 63 energy companies in Canada’s Standard & Poor’s/TSX Energy index had positive free cash flow, defined as operating cash flow minus capital expenditures, as of Aug. 17. That’s down from 43 percent in 2013, data compiled by Bloomberg show. The dwindling cash flow comes even after Canadian companies joined some $180 billion in global cutbacks this year, the most since the oil crash of 1986, according to Rystad Energy AS, an Oslo-based energy consultant. “There’s so much cash being spent on dividends,” said Greg […]

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BP Says Key Unit at Indiana Refinery Remains Shut

BP Plc said in a statement Monday that a key unit of its refinery in Indiana remains shut, but said it has met all of its contractual obligations since the outage hit more than a week ago. The Aug. 8 closure of the 413,000 barrel-a-day refinery’s main crude distillation unit led to a huge spike in gasoline prices in the Midwest last week, amid concerns overall supplies wouldn’t meet still-high consumer demand amid summer-driving season. In Indiana, retail gasoline prices were averaging $2.97 a gallon Monday, according to price-checking firm GasBuddy, up from $2.36 a gallon one week ago. Nationwide, gasoline prices are slightly higher from a week ago, at $2.67 a gallon. "The BP Whiting Refinery continues repair work on a crude distillation unit that was shut down due to a malfunction," the company said in an email. "The rest of the refinery continues to operate safely and […]

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Mexican oil swap sparks calls for full U.S. exports

Sen. Heidi Heitkamp, D-N.D., says crude oil is the only North Dakota commodity banned for exports. The Commerce Department last week clears oil swaps with Mexico, which supporters say is a step to easing that ban. File Photo by Kevin Dietsch/UPI | License Photo WASHINGTON, Aug. 17 (UPI) — A decision to swap crude oil with Mexico is a much needed step toward a full easing of the ban on domestic oil exports, U.S. production groups said. The U.S. Commerce Department last week granted a request from Mexican energy company Petroleos Mexicanos, known also as Pemex, to swap as much as 100,000 barrels of U.S. crude oil per day for refining into the nation. The deal requires Mexico to refine the crude oil at home and forbids re-export to other nations. Swaps are permissible under current legislation. Barrel Russell, president of the Independent Petroleum Association of America, said the […]

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Alberta producers review low-carbon agenda

Canadian oil and gas production group seeks balance in developing low-carbon economy in Alberta. Photo by akiyoko/Shutterstock CALGARY, Alberta, Aug. 17 (UPI) — Canadian oil and gas producers will work with the government in Alberta to find a balance between economic and environmental gains, a top executive said. The provincial government of Premier Rachel Notley appointed a five-member panel to develop a climate change strategy for resource-rich Alberta. Parks and Environment Minister Shannon Phillips said the panel is driving toward an organic and domestic-driven agenda . "Climate change is a threat we all face, affecting everything from our health, food production and fresh water, to biodiversity and our economy," she said in a statement. "All Albertans will have an opportunity to contribute to their province’s new plan to address this pressing global issue here at home." Most of Canadian oil sector activity is based in Alberta, a province that […]

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Canadian Stocks Resume Declines as Oil Slumps to Six-Year Low

Canadian stocks resumed their slide, falling for the fourth time in five sessions, as crude prices traded at the lowest in more than six years and financial shares slumped. Energy producers paced a decline in equities as crude futures dropped 1.5 percent in New York amid an increase in U.S. drilling and the prospect OPEC production may rise to a record after sanctions on Iran are lifted. Concerns grew that demand for oil may slip as manufacturing in New York unexpectedly shrank and Japan’s economy contracted last quarter. The Standard & Poor’s/TSX Composite Index fell 26.35 points, or 0.2 percent, to 14,251.53 at 4 p.m. in Toronto, paring a loss of as much as 0.7 percent in the final half hour of trading. The benchmark Canadian equity gauge has fallen 2.6 percent this year. Commodities producers are the worst-performing industries in the S&P/TSX this year as crude has slumped […]

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U.S. gives Shell final nod to drill for oil in Arctic

Shell branding is seen at a petrol station in west London, January 29, 2015. The Obama administration on Monday granted Royal Dutch Shell the final permit to drill for oil and gas in the Arctic for the first time since 2012, a move environmentalists vowed to fight. The Interior Department gave Shell the final permit to drill into the oil zone in the Chukchi Sea off northern Alaska after the Fennica, an icebreaker the company leases that carries emergency well-plugging equipment, was repaired after suffering a gash in its hull. The permit was expected as the department had previously approved Shell’s exploration program before the Fennica hit uncharted shoals in southern Alaska. Shell obtained the leases in the Chukchi during the administration of former President George W. Bush. Shell has spent about $7 billion on exploration in the Arctic. It has not explored in the region since 2012, when […]

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ND oil production numbers released today

“It could last two years”, Helms said. Officials believe the capacity exists to maintain production in North Dakota for another two full years even with the sustained lower prices. The industry, facing continued low crude oil prices, is finishing off previously drilled wells to get oil and some revenue flowing and to meet regulated completion timetables, state officials said Friday. Helms said the current number of active drilling rigs – 74 on Friday – and the inventory of wells that needs to be completed is sufficient to maintain production of 1.2 million barrels per day for 24 months. The state reached a milestone in June – passing the 10,000 mark for shale oil wells – but it comes amid rising uncertainty for the oil industry prompted by plummeting barrel prices that has caused the shutdown of numerous rigs in North Dakota. “Even though we have the low prices, there […]

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Ruble Near 6-Month Low Narrows Options for Central Bank Support

The ruble fell toward a six-month low amid renewed weakness in oil prices, threatening to end the Russian central bank’s series of interest-rate cuts aimed at reviving the economy. The currency slid 0.5 percent to 65.3010 per dollar by 4:32 p.m. in Moscow, dropping for a third day. The ruble has lost a quarter of its value since reaching this year’s peak on May 18 as the central bank stepped up foreign-currency purchases to build reserves. Brent crude fell 0.1 percent to $49.15 a barrel on Monday, trading below $50 for the third day after entering a bear market last month. Russia’s economy is heading for an estimated 3.6 percent contraction this year, hemmed in by lower oil prices and international sanctions tied to its role in the Ukraine conflict. Policy makers have reduced the benchmark interest rate five times by a total of 6 percentage points since making […]

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Peak of Gas Production in the Barnett Shale

An ocean of ink has already been spilled on pros and cons of using Hubbert curves to model production from a large collection of wells in one or many reservoirs. In 2010, I published together with my last graduate student in Berkeley, Dr. Greg Croft, a highly cited paper on this subject. I have also commented multiple times in this blog on the different aspects of the Hubbert curve analysis, its limitations, and predictive power. Since I cannot out-talk or out-convince the numerous critics of this type of analysis, let me give you a simple example of its robustness. This particular story is as follows. At the end of the year 2010, Greg Fenves, at that time Dean of UT’s Cockrell School of Engineering in Austin, asked me to make a presentation to the School’s Engineering Advisory Board (EAB). Using the results of our recent paper with Greg Croft, […]

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The Divergence Of Rig Count, Oil Price And Production Explained

Summary Since June, oil prices have plummeted 30% on concerns of a worldwide supply glut. Paradoxically, during this same period, the oil rig count has climbed by 74 rigs or 7%. This article analyzes this relationship between rig count and oil price to predict in which direction the rig count will move next. It also analyzes the relationship between oil production and rig count to complete the circuit and determine the evolution of oil supply in response to a change in oil price. Finally, I use this data to pinpoint a 3-month period during which I expect both domestic oil production and rig count to fall which will maximize bullish prospects for oil. My trading strategy based on this analysis is discussed in detail. Since June 24th, crude oil prices have plummeted 31%, as fears of a global storage surplus, weakening Chinese demand, and a strong U.S. dollar have […]

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Oil prices drop on shrinking Japan economy, more U.S. drill rigs

Offshore oil platforms are seen at the Bouri Oil Field off the coast of Libya August 3, 2015. Oil prices fell to near six-year lows on Monday as Japan’s economy contracted and producers in the United States added drilling rigs for a fourth straight week despite a recent rout in prices. Japan’s economy, the second biggest in Asia and No.3 in the world, shrank in the second quarter from a year earlier, adding to fears that slowdowns in Asia’s biggest economies will weigh on oil demand. U.S. crude CLc1, or West Texas Intermediate (WTI), was trading 58 cents lower at $41.92 a barrel at 0423 GMT (0023 EDT), close to more than six-year lows. Brent futures LCOc1 were down 54 cents at $48.65 a barrel, still some way from their 2015-low of $45.19. U.S. energy firms added oil rigs for a fourth straight week to the highest number since […]

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Oil Dips Further, Nymex Crude Under $42 a Barrel

By Eric Yep Oil slipped further into negative territory in Asian trade on Monday as the market remained under selling pressure, with U.S. oil prices dropping below the $42 a barrel mark. On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at $41.88 a barrel at 0341 GMT, down $0.62 in the Globex electronic session. October Brent crude on London’s ICE Futures exchange fell $0.64 to $48.55 a barrel. "We have concerns about crude fundamentals and prices in [the second half of 2015] and 2016," Morgan Stanley said in its weekly report. The bank warned that oil demand is already near peak seasonal levels and will fall in the coming weeks as summer demand wanes. Moreover, oil production from the Organization of the Petroleum Exporting Countries has grown significantly this year, and the U.S. dollar is expected to strengthen further, weighing on oil […]

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Oil Resumes Decline as U.S. Drillers Add Rigs for Fourth Week

Oil resumed its decline as a rebound in U.S. drilling added to signs producers will keep pumping crude amid a global glut. Futures slid as much as 1.4 percent in New York. The number of rigs seeking oil rose by 2 to 672 for the sixth gain in seven weeks, Baker Hughes Inc. data show. The U.S. agreed to allow some crude to flow to Mexico in the latest step toward easing a 40-year ban on most domestic exports. Oil has slumped more than 30 percent from the June closing peak this year amid speculation the global surplus will be prolonged. The Organization of Petroleum Exporting Countries may boost output to a record after Iran’s international sanctions are removed, according to the nation’s OPEC representative. “There is no change to the fundamentals,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “The market is continuing […]

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Iran supreme leader says fate of nuclear deal still unclear

AP Photo TEHRAN, Iran (AP) — Iran’s Supreme Leader Ayatollah Ali Khamenei is saying the fate of a historic nuclear deal with world powers is still unclear as lawmakers in both the Islamic Republic and the U.S. review it. Referring to the U.S., Khamenei said: "In their understanding of the deal, of which its fate is not clear since it is not clear if will be approved here or there, their intention was to find a way to penetrate into the country." The remarks by Khamenei, who has final say on all state matters in Iran, suggests he supports politicians’ role in approving the deal. Khamenei has not publicly approved or disapproved the deal, though he repeatedly offered words of support for Iran’s nuclear negotiators. Khamenei was quoted Monday by his official website.

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Iran expects petrochemical exports surge after sanctions lifted: IRNA

An Iranian national flag flutters during the opening ceremony of the 16th International Oil, Gas & Petrochemical Exhibition (IOGPE) in Tehran April 15, 2011. Iran expects to increase petrochemical exports by up to a quarter by the end of 2016 after sanctions are lifted, a senior official was quoted as saying on Saturday. Sanctions against Iran, due to be lifted in coming months after a July deal between Tehran and six world powers to curb its nuclear program, do not specifically target the petrochemical sector, but exports have slumped since banking and shipping restrictions were introduced in early 2012. "We expect our exports of petrochemical products to increase by 20 to 25 percent in a short time, between a year and a year and a half," Mehdi Sharifi Niknafs, managing director of the Iran Petrochemical Commercial Company, was quoted as saying by state news agency IRNA. "When banking, insurance […]

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Iraqi Premier Trims Size of Cabinet in Effort to Curb Corruption

Iraqi Prime Minister Haidar Al-Abadi has abolished four ministries and cut his cabinet to 22 from 33 in a push to cut wasteful government spending as lower oil prices choke off revenue. Three deputy prime minister positions and four ministries, including those overseeing human rights and women’s affairs, were scrapped, according to a decree posted Sunday on Al-Abadi’s website. The responsibilities of eight other ministries will be merged into four. Thousands of Iraqis took to the streets in recent weeks to protest corruption in OPEC’s second-biggest oil producer. With the plunge in crude and the battle against Islamic State militants depleting state coffers, bribery and abuse of power are compounding the nation’s economic woes. Iraq is among the world’s most corrupt nations, according to an index compiled by Transparency International. Ayatollah Ali Al Sistani, Iraq’s top Shiite cleric, urged the prime minister on Aug. 7 to tackle the problem […]

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Libya calls for air strikes against Isis

Sign up for quick access to a wealth of global business news, including: Libya calls for air strikes against Isis Newspaper + Premium online Newspaper + Premium online Premium Full FT.com subscription Premium Full FT.com subscription Standard Full news & archive Standard Full news & archive Trial Try Premium online Trial Try Premium online Price Monthly Annual $66.30 $11.77 per week $53.00 $9.25 per week $36.00 $6.45 per week $1.00 for 4 weeks $1.00 for 4 weeks FT Alphaville plus selected FT blogs yes yes yes yes Unlimited FT.com article access yes yes yes yes Unlimited mobile and tablet access yes yes yes yes Unlimited fast FT yes yes yes yes 5 year company financials archive yes yes yes yes The LEX column yes yes no yes ePaper access yes yes no yes Three exclusive weekly emails yes yes no yes Daily newspaper delivery yes no no For 4 […]

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Israel: Cabinet Approves Deal To Develop Leviathan Natural Gas Field

Israel’s Cabinet on Aug. 16 approved a deal with a U.S.-Israel consortium that would move forward development of the huge Leviathan natural gas field off Israel’s Mediterranean coast, officials said, Reuters reported. The deal still needs the approval of Israel’s parliament. Leviathan, with estimated reserves of 622 billion cubic meters, is slated to begin production in 2018 or 2019 and is expected to supply billions of dollars of natural gas to Egypt and Jordan in addition to supplying Israel. Stratfor provides global awareness and guidance to individuals, governments and businesses around the world. We use a unique, intel-based approach to analyze world affairs. Copyright © 2015 Stratfor Global Intelligence, All rights reserved. Our mailing address is: 221 West 6th Street Suite 400 – Austin, TX 78701, USA unsubscribe from this list update subscription preferences | forward email

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Brazilians Return to Streets to Urge Rousseff’s Ouster

RIO DE JANEIRO — Tens of thousands of protesters returned to the streets of cities across Brazil on Sunday to express their ire against President Dilma Rousseff , reflecting a low ebb for her as she grapples with a colossal bribery scandal and a declining economy. Still, the protests in some cities seemed to lack some of the urgency of huge demonstrations this year calling for the ouster of Ms. Rousseff, a leftist who won re-election just 10 months ago, suggesting tension may be easing somewhat on the president as congressional and business leaders try to prevent a political crisis from intensifying. The protest in Rio de Janeiro had something of a Carnivalesque feel to it; some demonstrators wore bathing suits as they marched through the Copacabana district as trucks blared samba. But vitriol also marked the event, with some urging the president to kill herself or calling on […]

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Ethanol acts as lone bright spot amid China commodity gloom

Sugar farmers harvest at a field in Guangxi province, southern China January 17, 2007. Recent news from China makes depressing reading for commodities producers, with a slowing economy, tumbling stock prices and a currency devaluation all signaling weaker demand. There is one exception: the world’s second biggest economy has begun importing ethanol in volumes big enough to stir hopes that it might herald an opening of a major, until now barely accessible, market. "If it becomes constant, that’s big news. China’s a place where everyone looks and says, ‘what if,’" said Jordan Fife, a merchant with BioUrja Trading LLC in Houston. State-run grain trader China National Oils and Foodstuffs Corp, known as COFCO, has begun shipping ethanol from its recently acquired mills in Brazil in recent months, the first shipments from the world’s second-biggest exporter since 2012, according to trade sources and Brazilian trade data. Other Chinese buyers have […]

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June oil production ties record peak

Oil production in June matched its record peak from last year. Oil production in June rose to its highest levels since its record peak late last year, North Dakota regulators said Friday, adding that the current level of production could be maintained for about two years. Preliminary June numbers from the North Dakota Department of Mineral Resources had production at 1,211,178 barrels per day. This was an increase of more than 8,500 daily barrels from the final May tally of 1,202,615 barrels per day. The active rig count in the state was at 74 on Friday. Lynn Helms, director of the Department of Mineral Resources, said production has maintained due to operators primarily drilling in the most productive parts of the oil patch and increasing efficiencies with staff and equipment. Well completions by hydraulic fracturing increased from a final May count of 116 to a preliminary total of 149 […]

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Hedge Funds Resume Flight From Oil as Prices Sink to 6-Year Lows

After showing some short-lived optimism, hedge funds resumed their retreat from the U.S. oil market, cutting bullish positions for the seventh time in eight weeks as prices dropped to the lowest since 2009. Money managers’ net-long position in West Texas Intermediate crude declined 11 percent in the week ended Aug. 11, U.S. Commodity Futures Trading Commission data show. Short positions climbed to the highest level since March, a signal speculators see prices continuing to fall. Futures markets this summer have plunged the most since trading began in 1984, as the U.S. enters a period in which refinery demand usually falls. A global surplus will last through 2016, the International Energy Agency said Aug. 12. The Organization of Petroleum Exporting Countries reported the day before that its output climbed last month to the highest level in more than three years. “The consensus view is that we’ve got further to fall,” […]

Posted On : Published By : Tom Whipple