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Crude oil falls after U.S. inventories show buildup

Offshore oil platforms are seen at the Bouri Oil Field off the coast of Libya August 3, 2015. Crude oil futures fell in early Asian trade on Wednesday after U.S. inventories showed a weekly buildup that far exceeded analyst expectations. The American Petroleum Institute (API) said late on Tuesday that U.S. crude oil stockpiles rose by 4.6 million barrels to 457.8 million barrels in the week to Sept. 25. Analysts polled by Reuters had expected an increase of only 102,000 barrels. <API/S> <EIA/S>. Front-month U.S. crude had dropped 49 cents, more than 1 percent, to 44.74 a barrel by 0012 GMT (2012 EDT). The contract settled Tuesday’s trade at $45.23 a barrel, up 80 cents, or 1.8 percent, on the day. Brent crude, the global oil benchmark, fell 37 cents to $47.86 a barrel. On Tuesday, the contract rose 89 cents, or 1.9 percent, to $48.23. The U.S. government’s […]

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IEA chief expects $45 oil ‘for a long time’: newspaper

Chief Economist of the International Energy Agency Fatih Birol speaks during a question and answer session at the Oil & Money conference in London October 1, 2013. The executive director of the International Energy Agency, Fatih Birol, expects the price of crude oil to stay at around $45 a barrel "for a long time", he said in a newspaper interview published on Tuesday. When asked by Austrian newspaper Kurier whether prices would ever exceed $100 a barrel again, Birol said: "I can only say that the oil price will remain low for some quarters." "Forty five dollars a barrel will remain the price for a long time," he was quoted as saying. Benchmark Brent crude futures were unchanged at $47.34 a barrel at 0115 EDT, while WTI crude futures were down 2 cents at $44.41 per barrel. "Cheap oil is causing oil companies big problems," Birol said. "This year, […]

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Kurds launch offensive against Islamic State in north Iraq

ERBIL, Iraq (Reuters) – Kurdish forces attacked Islamic State in northern Iraq on Wednesday in the latest of several offensives aimed at driving the militants away from the oil-rich city of Kirkuk. The assault began in the early morning to capture the al-Gurra heights to the west of Kirkuk in the direction of the Islamic State bastion of Hawijah, Kurdish military sources said. The Kurds took full control of Kirkuk last summer when Iraqi soldiers abandoned their bases in and around the city as Islamic State militants overran around a third of the country. The peshmerga have been widening a buffer around the city in a series of offensives, clearing more than 530 square kilometers over the past six months, according to the region’s security council. Apart from the gains around Kirkuk, the frontline between peshmerga and Islamic State has hardly moved for months. Islamic State has not been […]

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The collapse of Saudi Arabia is inevitable

On Tuesday 22 September, Middle East Eye broke the story of a senior member of the Saudi royal family calling for a “change” in leadership to fend off the kingdom’s collapse. In a letter circulated among Saudi princes, its author, a grandson of the late King Abdulaziz Ibn Saud, blamed incumbent King Salman for creating unprecedented problems that endangered the monarchy’s continued survival. “We will not be able to stop the draining of money, the political adolescence, and the military risks unless we change the methods of decision making, even if that implied changing the king himself,” warned the letter. Whether or not an internal royal coup is round the corner – and informed observers think such a prospect “fanciful” – the letter’s analysis of Saudi Arabia’s dire predicament is startlingly accurate. Like many countries in the region before it, Saudi Arabia is on the brink of a perfect […]

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After Oil Auction Snub, Mexico Sweetens Pot — But Is It Enough?

Mexico is sweetening the terms of its next oil-block auction in a bid to avoid a repeat of its failed earlier attempt at opening up the industry. The big question now: Is it enough? Investors will answer that question in a sale on Wednesday of shallow-water exploration and production blocks, only the nation’s second since it nationalized its oil industry in 1938. After global energy giants Exxon Mobil Corp., Chevron Corp. and Total SA sat out the first auction in July, Mexico rewrote the rules. This time around, the blocks are bigger, the financial terms less rigid and the government’s slice of the profits smaller. Even with the improved auction terms, Mexico is fighting global headwinds that could hurt the outcome, said Fadel Gheit, an analyst at Oppenheimer & Co. in New York. Oil prices have slumped more than 50 percent in the past year and companies from ConocoPhillips […]

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China could import 100 Bcm/year Russian gas by 2020: CNPC

China could import 100 Bcm of Russian gas, including natural gas and LNG, in 2020, or about one third of the country’s total consumption, as it sees Russia as a strategic partner that would help it move to cleaner fuel away from coal, Zhen Wang, CNPC’s deputy director-general, policy research, told journalists Wednesday. China has chosen gas as its next top growth fuel, as it is required to lower emissions by 2020 according to an agreement with the US. Gas is to make up 60% of China’s energy portfolio by then, Wang said. While China would prefer to diversify the suppliers, Wang said having Russia as the largest supplier would be safe. "From the consumer side, we want to diversify gas supplies, it would be much safer. But I don’t think [Russia being the largest supplier] is a real problem. China is big enough, and China’s gas market is […]

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Natural gas prices in Asia mainly linked to crude oil, but use of spot indexes increases

graph of global crude oil, LNG, and natural gas prices, as explained in the article text Source: U.S. Energy Information Administration, Petroleum Association of Japan, Japan Ministry of Finance International Trade Statistics, Japan Ministry of Economy, Trade and Industry, Bloomberg LP Note: Values for North Sea Brent and Japanese customs-cleared (JCC) crude oil prices converted to $/MMBtu on an energy-equivalent basis. The official reporting of Japan spot LNG price statistics began in March 2014, so no prior data exist. Unlike the natural gas market in the United States, natural gas prices in Asian markets typically reflect contracts that are indexed to crude oil or petroleum product prices. The declines in crude oil prices between August 2014 and January 2015 had a significant effect on Asian natural gas prices and markets. However, Asian countries are developing regional trading hubs so that natural gas prices better reflect natural gas market dynamics. […]

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Kazakhstan: No changes on Kashagan

No updates in plans for offshore Kashagan oil field, the deputy energy minister in Kazakhstan says. Photo courtesy North Caspian Operating Co. ASTANA, Kazakhstan, Sept. 29 (UPI) — There are no changes in the operational plans for the giant Kashagan oil field off the coast of Kazakhstan, the country’s deputy energy minister said. Kazakh Deputy Energy Minister Uzakbai Karablin told an audience at an investment conference in the capital Astana commercial production from the field was expected about six weeks after operations are slated to begin in late 2016. "All the work was planned for this period, and there are no changes for now," he was quoted by the regional Trend news agency as saying. Kashagan is among the largest oil fields in the world, with an estimated 16 billion barrels of oil reserves. Production was halted in October 2013, less than a month after it started, when a […]

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China’s Demand for Oil Is Totally Misunderstood by the Market

Slippery oil statistics. Amid sinking crude prices, there’s been an almost singleminded focus on supply dynamics in the oil market, particularly on the resilience of U.S. production, which has proven nearly impervious to large-scale declines in the number of active rigs. Although tentative signs suggest domestic crude production is rolling over , analysts led by Laban Yu, head of Asia oil and gas equities for Jefferies, think it’s time to focus on what’s going on at the other side of the ledger on the other side of the world. Yu’s team has grown more than a little sick of reports linking weakness in crude oil prices to softening economic data in China. There’s one big problem with this narrative, according to the analysts: Chinese oil demand is actually quite robust, up 9.2 percent year-over-year, as of August. In this case, lower prices have spurred demand; annual demand growth from […]

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Industry praises Shell’s arctic safety record

Shell praised by industry peers for safe 2015 campaign in the arctic waters off the coast of Alaska. Photo courtesy of the Bureau of Safety and Environmental Enforcement WASHINGTON, Sept. 29 (UPI) — Despite disappointing results for Shell in arctic Alaskan waters, industry leaders say the $7 billion campaign was a success in terms of safe operations. Royal Dutch Shell said it was dismantling its exploratory operations in the arctic Chukchi Sea after drilling uncovered no commercial prospects of oil and natural gas. Environmental activists praised the end to a campaign they viewed as risky, with Greenpeace calling for a moratorium in future arctic programs. Marvin Odum, director of Shell’s exploration and production division in North America, said this year’s program was safe in every aspect of operations. "Contrary to the previous rhetoric of anti-development activists, the 2015 Chukchi Sea exploration season provides further evidence that drilling can be […]

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AAA: Refinery issues throttling gas price slide

Refinery issues slowing decline in U.S. retail gasoline prices, motor club AAA said in a weekly report. Photo by Oskari Porkka/Shutterstock WASHINGTON, Sept. 29 (UPI) — Though U.S. refineries are making a blend of gasoline that’s cheaper to produce, maintenance issues are keeping consumer prices elevated, AAA said. The motor club lists a national average of $2.29 per gallon for Tuesday, relatively unchanged from one week ago. The retail price for a gallon of regular unleaded gasoline is down 20 cents, or 8 percent, from one month ago. U.S. refineries on Sept. 16 started producing a winter blend of gasoline, which is cheaper to produce because fewer environmental safety measures are necessary during cooler months. This should push retail prices lower. "Unlike previous years, refinery maintenance season this autumn is expected to be heavier than usual due to refineries operating at higher than normal rates for longer periods over […]

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U.S. studying offshore wind farm impacts

U.S. government reviewing potential impacts off offshore wind farm construction starting with Rhode Island program. File photo by Teun van den Dries/Shutterstock WASHINGTON, Sept. 29 (UPI) — Starting with a development off the Rhode Island coast, the federal government said it was studying the real-time impacts of offshore wind farm construction. The Bureau of Ocean Energy Management said it started its Real-Time Opportunity for Development Environmental Observations — or RODEO — program with Rhode Island. BOEM Chief Environmental Officer William Brown explained the program will provide real-time data on potential environmental impacts and seafloor disturbances related to wind farm installation offshore. "The first opportunity to conduct this research is through the historic Deepwater Wind project," he said. The Rhode Island government in May 2014 signed off on environmental permits for what will become the nation’s first offshore wind farm, Deepwater Wind’s Block Island project. The wind farm will generate […]

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Chesapeake Energy Cuts 15% of Jobs

In a regulatory filing Tuesday , the U.S. shale driller said it expects to post third-quarter charges of roughly $55.5 million related to the move. Because of the swoon in oil prices, Chesapeake has reduced rig operations and cut capital expenditures after failing to offset the plunge with higher production. Chesapeake, based in Oklahoma City, had about 5,000 employees. On Tuesday, 740 of them were laid off, with about 560 of those positions coming from the home office in Oklahoma, the company said. “As you are fully aware, the current commodity price environment continues to be a challenge for our industry and for Chesapeake,” Chief Executive Doug Lawler wrote in an email to employees. “While this was extremely difficult, we are acting decisively and prudently to enhance the long-term competitiveness and strength of Chesapeake.” Shares of Chesapeake Energy, down 71% over the past year, fell 0.3% to $6.77 in […]

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Liquidity Squeeze Is on for Norway Bonds as Oil Drop Drains Cash

Norway’s bond market is feeling the squeeze and the country’s regional banks are the main victims. Companies and banks seeking to raise debt are finding few willing investors out there, after life insurance companies filled up on bonds and real estate before the summer this year and as the plunging krone is keeping away foreign investors, according to DNB ASA, Norway’s largest lender. “Many investors have been rather fully invested,” said Jan Krogh-Vennemo, global head fixed income sales at DNB. “When spreads first start widening buyers become cautious and there were some issuers, especially within finance, that were ready after the summer and needed money.” The squeeze is mainly being felt for Norwegian savings banks. Spreads on five-year senior unsecured bank funding widened by 17 basis points last week to 105 basis points, the highest since February 2013, according to DNB. Sparebank 1 SMN, for example, paid 105 basis […]

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Final leg of new European gas line completed

Norwegian energy company Statoil completes last stretch of Polarled pipeline for European gas needs. Map courtesy of Statoil STAVANGER, Norway, Sept. 29 (UPI) — Norwegian energy company Statoil said the last stretch of a 300-mile natural gas pipeline crossing the Arctic Circle has been completed. The final piece of the 36-inch diameter Polarled gas pipeline was placed more than 4,000 feet below the surface of the Norwegian Sea in the Aasta Hansteen field. "With this pipeline, we open up for the export of gas to Europe from a completely new area, and with the infrastructure in place it will also be more attractive to explore the area," Statoil project planner Torger Rod said in a statement. Aasta Hansteen is estimated to hold between 175 billion and 300 billion cubic feet of recoverable natural gas, making it one of the largest fields in the region. Once it starts, an onshore […]

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Low Oil Prices – Why Worry?

Most people believe that low oil prices are good for the United States, since the discretionary income of consumers will rise. There is the added benefit that Peak Oil must be far off in the distance, since “Peak Oilers” talked about high oil prices. Thus, low oil prices are viewed as an all around benefit. In fact, nothing could be further from the truth. The Peak Oil story we have been told is wrong . The collapse in oil production comes from oil prices that are too low, not too high. If oil prices or prices of other commodities are too low, production will slow and eventually stop. Growth in the world economy will slow, lowering inflation rates as well as economic growth rates. We encountered this kind of the problem in the 1930s. We seem to be headed in the same direction today. Figure 1, used by Janet […]

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Why Jeff Bezos, Peter Thiel, and others are betting on fusion

The energy source has been long on promise and short on reality. Now private companies think they can succeed where the government has failed. For more than half a century governments around the world have been trying to solve the challenge of nuclear fusion. In theory it could provide a cheap, clean, and almost boundless source of energy. Consider this: One tablespoon of liquid hydrogen fuel—a mix of deuterium and tritium—would produce the same energy as 28 tons of coal. But smashing two hydrogen atoms together at 100 million degrees centigrade to create a fusion reaction has proved to be a costly and elusive endeavor. The ITER international project in France has been plagued by cost overruns—the original 5-billion-euro project is now budgeted at 13 billion euros (about $15 billion)—and its 23,000-ton Tokamak experimental reactor, three times heavier than the Eiffel Tower, is still many years from completion. In […]

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Oil prices remain weak on Asia economy woes; shares in commodity firms tumble

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Oil prices remained low in early Asian trading on Tuesday following a slide of almost 3 percent the previous session, dragged down as concerns over Asia’s economic health mounted and as production remained high. Brent crude futures LCOc1 were at $47.31 per barrel at 0138 GMT, down 3 cents from their last close and following a more than 2.5-percent drop on Monday. U.S. West Texas Intermediate (WTI) futures CLc1 were at $44.44 a barrel, virtually unchanged from their last settlement. Oil prices, along with most other commodities, have fallen sharply recently, with crude futures losing almost 60 percent of their value since June 2014. Japanese stock markets, among the earliest to open in Asia, slid to eight-month lows on Tuesday as global stocks came under pressure from worries about economies in China and other emerging markets. […]

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Oil Prices Slide on Growth, Oversupply Concerns

Oil prices slid on Monday, pressured by concerns about weaker global economic growth and the oversupply of crude. Light, sweet crude for November delivery, the front-month contract, fell $1.27, or 2.8%, to $44.43 a barrel on the New York Mercantile Exchange, a two-week low. The global Brent contract lost $1.26, or 2.6%, to settle at $47.34 a barrel on the ICE Futures Europe exchange. An employee uses a wrench to adjust a valve on oil pumping gear. New data raised fresh worries about slowing economic growth in China. Chinese officials reported that industrial profits in the country fell 8.8% from year-ago levels, the largest decline since 2011. Meanwhile, a French newspaper quoted International Monetary Fund Managing Director Christine Lagarde as saying that its prior global growth estimates were “not realistic anymore” and that forecasts for this year and next would be revised lower. The IMF will publish its new […]

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Oil prices fall on slowing global economic growth outlook

A gas station worker fuels a vehicle in Tokyo August 26, 2015. Oil prices dropped in early trading in Asia on Monday despite a fourth weekly fall in U.S. drilling activity, with analysts pointing to the weak economic outlook as the main reason for low crude prices. The International Monetary Fund is likely to revise downwards its estimates for global economic growth due to slower growth in emerging economies, IMF head Christine Lagarde said in a newspaper interview. In line with bearish sentiment, Brent crude futures LCOc1 were at $48.27 per barrel at 0024 GMT, down 33 cents from their last close. U.S. West Texas Intermediate (WTI) futures CLc1 were at $45.34 a barrel, down 36 cents. Crude futures are now down over 10 percent since the beginning of the month, and rating agency S&P cut its Brent and WTI forecasts late last week by $5 to $50 per […]

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IMF worries bruise crude oil prices

IMF Managing Christine Lagarde says global economy recovering from recession, but pace is slowing. Crude oil prices react with 2 percent drop in early Monday trading. UPI/Kevin Dietsch NEW YORK, Sept. 28 (UPI) — Expectations from the International Monetary Fund of a weakening global economy pushed crude oil prices down more than 2 percent in early Monday trading. IMF managing director Christine Lagarde told French newspaper The Echoes the global economy was recovering from the latest recession, but the pace is decelerating . "A global gross domestic product of 3.3 percent this year is no longer realistic. A forecast of 3.8 percent for next year is not either," she said. "We still remain above the 3 percent threshold." A surplus of crude oil on the international market and weak demand has pushed crude oil prices to historic lows. Brent crude oil was down 2.1 percent in early Monday trading […]

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IEA chief expects $45 oil ‘for a long time’: newspaper

Chief Economist of the International Energy Agency Fatih Birol speaks during a question and answer session at the Oil & Money conference in London October 1, 2013. The executive director of the International Energy Agency, Fatih Birol, expects the price of crude oil to stay at around $45 a barrel "for a long time", he said in a newspaper interview published on Tuesday. When asked by Austrian newspaper Kurier whether prices would ever exceed $100 a barrel again, Birol said: "I can only say that the oil price will remain low for some quarters." "Forty five dollars a barrel will remain the price for a long time," he was quoted as saying. Benchmark Brent crude futures were unchanged at $47.34 a barrel at 0115 EDT, while WTI crude futures were down 2 cents at $44.41 per barrel. "Cheap oil is causing oil companies big problems," Birol said. "This year, […]

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Lid on Oil Prices Refuses to Budge

Oil bulls can’t catch a break. The long-awaited decline in U.S. oil output has begun, data show, but many investors and analysts are still waiting for prices to stage a sustained recovery. The rapid growth in America’s production over the past several years was a major driver behind the plunge in the benchmark U.S. oil price, which is down 53% from a year ago. Once that output slowed, oil would bounce back, bullish investors reasoned. But their hopes have been thwarted by robust output from other parts of the world, from Russia to Saudi Arabia and Iraq, that has kept a lid on prices. “We now know that the U.S. [production] is in decline,” said Eric Nuttall, portfolio manager at Sprott Asset Management, which manages about $5.8 billion. “I would have thought [prices] would be higher, with the data points, but maybe people need another month or two” of […]

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Secretive Militia’s Challenge Risks Eroding Abadi Power in Iraq

A Shiite militia that refuses even to identify its leader is emerging as one of the greatest threats to the Iraqi administration it’s meant to be backing. Kataib Hezbollah has thousands of fighters deployed against the jihadists of Islamic State. While the Iranian-backed group has played a key role in helping Prime Minister Haidar al-Abadi stem the militants’ advance, it’s now joining forces with other Shiite militias to oppose the premier’s push to enact a measure that could limit its own power, and Tehran’s influence. At the heart of the dispute is the National Guard Law, legislation meant to bring all pro-government armed groups under a unified command. The measure is backed by the U.S. as the only way to halt the breakup of OPEC’s second-biggest oil producer. “We reject this law and we will chase anyone who votes for it in the Iraqi parliament,” Jaafar al-Husseini, a spokesman […]

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Iraq’s Oil Production Seen at Risk by Barclays as Winter Nears

Iraq’s oil production is at risk for winter when “loading problems” have historically reduced output by 300,000 to 500,000 barrels of crude a day, Barclays Plc said. Loading facilities and the nation’s single-point mooring systems are “insufficient for the winter season,” Michael Cohen, a Barclays analyst in New York, said in a Sept. 25 report. It wasn’t clear from the report what causes the disruptions during winter. Shipments from Basra in the south are sometimes slowed by strong winds during the first part of the year. In April, a four-mile (6.4-kilometer) line of supertankers was waiting to load the nation’s crude. OPEC’s second-largest crude producer has increased output this year as supplies from the south expanded even as Islamic State fighters occupied parts of the north. Iraq needs to keep increasing production because lower oil prices have curbed government revenue. Crude output will increase by about 500,000 barrels a […]

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Inside Iran: Sanctions and the Carpet-Sellers

Iran’s Persian carpet industry is fraying at its edges. Once the biggest exporter of carpets in the world, the country’s trade has been hit hard by Western sanctions. Exports have shrunk by 33 percent since 2009, according to Iran’s state news agency IRNA, hitting $330 million in the year to March 2015. After the oil sector, the carpet industry has been the most affected. Cheaper replicas from Asia now make up the majority of imports to the West . ‘The price was increasing, not day by day but every week, every month’ Exports are “more or less zero” according to Mojtabah Keshevarz, owner of Royal Persian Carpets in the capital, Tehran. “It was a good business,” he explains. “The price was increasing, not day by day but every week, every month.” The trader says one of his most expensive carpets, a pomegranate-and-walnut-dyed rug woven in Isfahan, is 100 years […]

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Parties in Iran Nuclear Deal Aim for Implementation in Early 2016

UNITED NATIONS—Foreign ministers from Iran and the six powers that negotiated July’s nuclear agreement met Monday evening to discuss the implementation of the deal, with European Union foreign policy chief Federica Mogherini saying they hope to complete that work in early 2016. With the agreement now backed by a United Nations resolution and with efforts to defeat the accord in the U.S. Congress having failed, Iranian Foreign Minister Javad Zarif and counterparts from the other nationsdiscussed Monday next steps for putting the deal into effect—and possible hurdles ahead. Iran will only win major sanctions relief once it has carried out a whole series of measures to scale back its nuclear program and infrastructure. Iran’s parliament still has to vote to approve the deal. Monday’s hourlong foreign ministers meeting was the first since the nuclear agreement was sealed July 14 in Vienna. Speaking to reporters afterward, Ms. Mogherini said the […]

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Nigeria: Massive Fuel Imports As Refineries Remain Down

There has been a steady surge in fuel importation to Nigeria with more inflows expected from Europe in the months to come. Trading sources told Platts, a global energy information website, at the weekend that one of the main reasons for the strong demand has been the increased buying interest from Nigeria. The country has four refineries which could reduce petroleum products importation by up to 50 per cent but the refineries have struggled to remain afloat and have been unable to churn out products in appreciable quantities since the Nigeria National Petroleum Corporation (NNPC) announced they were back. For instance, the 37-year-old Warri refinery has remained shut since August due to some technical hitches in one of its units. The NNPC Group Managing Director, Dr Ibe Kachikwu gave a 90 days ultimatum to the refineries to stream back to full active service or be sold. There are plans […]

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India Oil Refiners Said to Pay $700 Million to Iran on Sept. 30

Indian oil refiners will pay Iran $700 million on Sept. 30 for crude oil imports, their first payment this year as international sanctions on the Persian Gulf nation are set to be eased, said people familiar with the matter. An equal amount is expected to be paid next month, the people said, asking not to be identified before an announcement. In November, the refiners paid Iran $400 million of dues, which accumulated since early 2013. Indian refiners including state-owned Mangalore Refinery & Petrochemicals Ltd., Indian Oil Corp. and Hindustan Petroleum Corp. and non-state company Essar Oil Ltd. owe Iran about $6.4 billion, blocked because of international sanctions. Iran is looking to boost crude supplies after it reached an agreement with six world powers on July 14 in Vienna to curb its nuclear ambitions in exchange for the easing of sanctions. The Indian refiners will pay state-owned UCO Bank in […]

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North Dakota rig count up by four

North Dakota rig count increased by four, with much of the reported during the weekend. Photo by Steve Oehlenschlager/Shutterstock BISMARCK, N.D., Sept. 28 (UPI) — North Dakota bucked the nationwide trend by adding more rigs to its state portfolio with the total number increasing by nearly 6 percent. State data show 71 rigs actively exploring for or producing oil and natural gas in the state. That’s up nearly 6 percent , or four rigs, from the previous week. Most of the new rig activity came during the weekend. Data from oil field services company Baker Hughes show North Dakota lost one rig last week compared with the week ending Sept. 25. Texas for the week lost the most rigs with a total decline of two. Energy companies are spending less on exploration and production because of the steady decline in crude oil prices, down by about half from last […]

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Texas oil production holds steady

Texas oil production holding steady, though rig activity is on a clear decline, state data show. File photo by Lilac Mountain/Shutterstock AUSTIN, Texas, Sept. 28 (UPI) — Though drilling permits are on the decline, Texas crude oil production held more or less steady month-to-month, state data for July show. The Railroad Commission of Texas, the state’s energy regulator, reports 2.45 million barrels of oil produced per day in July, the last full month for which the state has data. Year-on-year, total crude oil production is up 9.3 percent . Month-to-month, production is up about eight tenths of a percent. The commission said Texas oil production came from 176,810 oil wells in the state. In its latest report on rig activity, the state regulator said the number of drilling permits issued in Texas was down more than half from the same month last year to 864, of which 730 were […]

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Shell Exits Arctic as Oil Slump Forces Industry to Retrench

Photo Shell had some mishaps in Alaska, such as when its floating drill rig Kulluk, center, ran aground in 2012. Credit James Brooks/Kodiak Daily Mirror, via Associated Press Royal Dutch Shell ended its expensive and fruitless nine-year effort to explore for oil in the Alaskan Arctic on Monday in another sign that the entire industry is trimming its ambitions in the wake of collapsing oil prices. The decision came after one well drilled by Shell this summer came up mostly dry, and environmental groups declared a major victory. But at a time when global markets are glutted with oil, it also confirmed the major oil companies’ increasing willingness to turn their backs on the most expensive new drilling prospects in the Gulf of Mexico and suspended plans for new projects in Canada’s oil sands . Shell spent more than $7 billion on its Alaska venture. The industry has cut […]

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Survey of Republican Voters Shows a Majority Believe in Climate Change

Photo A Republican supporter wore a tie decorated with elephant mascots at the Republican National Convention in Tampa, Fla., in 2012. Credit Daniel Acker/Bloomberg, via Getty Images WASHINGTON — A majority of Republicans — including 54 percent of self-described conservative Republicans — believe the world’s climate is changing and that mankind plays some role in the change, according to a new survey conducted by a trio of prominent Republican pollsters. The results echo a number of other recent surveys concluding that, despite the talk of many of the party’s candidates, a significant number of Republicans and independent voters are inclined to support candidates who would back some form of climate action. It may also point to a problem facing Republicans seeking their party’s presidential nomination: The activists who crowd town hall meetings and Republican presidential caucuses and primaries might not reflect the broader attitude of even the Republican electorate. […]

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A risky proposition: The ‘regulatory hole you could drive a train through’

Shiho Fukada for Al Jazeera America Propane tanks sit on the rail depot of Grafton & Upton Railroad in Grafton, Massachusetts, Sept. 24, 2015. This article was produced in collaboration with the New England Center for Investigative Reporting , a nonprofit news outlet in Boston that holds the powerful accountable and trains a new generation of investigative reporters. GRAFTON, Mass. — In early 2012, residents of this sleepy town began to notice an unusual amount of activity around the Grafton & Upton rail yard at the north end of town. An old barn that had stood for over a century was knocked down. Bulldozers came out, clearing the land. The tiny 16.5-mile railroad had been nearly defunct, but was purchased in 2008 by Jon Delli Priscoli, a major local developer with a penchant for railroads; he also owns a Thomas the Tank Engine theme park 70 miles away. At […]

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So far, less pain than feared as U.S. shale firms renew loans

Unused oil tank cars are pictured on Western New York & Pennsylvania Railroad tracks outside Hinsdale, New York August 24, 2015. A number of U.S. shale oil and gas companies are securing unchanged or even increased credit allotments during their semi-annual loan reviews, defying expectations that banks would slash small firms’ credit lines in response to low crude prices. According to a Reuters review of disclosures made by 19 independent U.S. shale oil and gas companies since Aug. 1, at least 11 have said their borrowing bases have been or will be maintained or increased. In contrast, just five talked about cuts. It is too early to tell if the whole sector will emerge equally largely unscathed from the reviews. Many more companies from a batch of about 60 U.S. independents typically tracked by investment banks will probably make disclosures after the usual loan reset deadline of Oct. 1. […]

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U.S. jet fuel demand is rising strongly: Kemp

An airport worker fuels a JetBlue plane on the tarmac of the John F. Kennedy International Airport in New York December 11, 2013. Fuel consumption by U.S. airlines is growing at some of the fastest rates for a decade, according to data published by the federal government. U.S. carriers consumed 1.6 billion gallons of fuel in July, up 3.4 percent from the same month a year earlier ( link.reuters.com/qad75w ). Fuel consumption for the first seven months of the year rose nearly 2.9 percent, the biggest increase since 2011 and before that 2005, according to the U.S. Department of Transportation. Separately, the U.S. Energy Information Administration (EIA) has reported jet fuel consumption rose 4.7 percent year-on-year in January-June (according to product-supplied statistics) or by 6.6 percent in January-July (using prime supplier data). Unlike the U.S. Department of Transportation fuel consumption data, which covers only U.S. airlines, the EIA numbers […]

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Shell’s Arctic Withdrawal Adds to Cold Spell for Alaskan Crude

Alaska, once the workhorse of the U.S. oil industry, is being put out to pasture. Royal Dutch Shell Plc’s decision to end its $7 billion search for oil in the Arctic Ocean off the coast of Alaska is the latest bit of bad news for a state that went from producing one in every four barrels in the U.S. to an afterthought during the shale boom. “Alaska used to be the No. 1 oil producer in the U.S.,” said Carl Larry, head of oil and gas for Frost & Sullivan LP in Houston. “Now there are a lot easier places and better ways to find and produce oil.” Alaskan oil production topped out in 1988 at more than 2 million barrels a day. It’s declined steadily since then, falling below 500,000 last year for the first time since the late 1970s, according to the Energy Information Administration. Aging reservoirs […]

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Shell’s Alaska Exit Means Arctic Oil Reserves Remain Locked Away

The inglorious end to Royal Dutch Shell Plc’s $7 billion search for oil in Alaska means billions of barrels of crude will probably remain locked away in Arctic waters from the U.S. to Russia — at least as long as prices remain near $50 a barrel. Shell abandoned exploration off Alaska for the “foreseeable future” on Monday after it failed to find meaningful quantities of oil or natural gas. In Russia, sanctions over Ukraine have halted partnerships aimed at exploring offshore in the Arctic, while exploration in Greenland has been on hold since 2012 and activity in Norway is slowing. “This effectively ends exploration for new Arctic oil until prices recover,” Ahmed Ben Salem, a Paris-based analyst with Oddo & Cie, said by phone. “Shell was the only company with a strong enough balance sheet that was currently exploring in the Arctic.” In a world where OPEC members control […]

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Tesla Prepares to Launch Electric SUV

Kenneth Adelman has had to learn to be patient. An electric-car enthusiast and retired “computer geek,” in February 2012 he was the first person to plunk down a $40,000 deposit for Tesla Motors Inc. TSLA -3.30 % ’s Model X sport-utility vehicle. At the time, Mr. Adelman didn’t know the Model X’s total price, but Chief Executive Elon Musk said the vehicle would be in his hands by the end of 2013. He is still waiting. After nearly two years’ worth of delays, Tesla kicks off Model X deliveries Tuesday. Although first on the order list, Mr. Adelman, 52 years old, doesn’t know when he will get his vehicle and he is showing little concern. “I’m happy to have waited for the X to be all that it could be,” Mr. Adelman, who also owns a Tesla Roadster and Model S sedan, said in a recent interview. He is […]

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Jeb Bush’s Energy Plan Includes Dropping Oil-Export Ban

By Amy Harder And Beth Reinhard In his third policy announcement this month aimed at accelerating economic growth, Jeb Bush is calling to remove the nation’s 40-year-old ban on oil exports, approve the Keystone XL pipeline and eliminate a raft of environmental regulations. Mr. Bush is expected to outline his energy platform Tuesday afternoon at Rice Energy, a Pennsylvania oil and gas company. Mr. Bush is promising that this agenda, along with his plans unveiled earlier this month to lower tax rates and roll back regulations on business, would generate 4% annual economic growth–a target the U.S. hasn’t hit in a sustained way since the late 1990s. Mr. Bush’s energy ideas are mainstays among Republican presidential hopefuls on the campaign trail. All of the GOP candidates for president support the Keystone pipeline and many, including retired neurosurgeon Ben Carson, businessman Donald Trump and New Jersey Gov. Chris Christie, support […]

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Sanctions, Oil Slump Delay Russian Offshore Drilling 2-3 Years

Russia’s state-run energy giants Rosneft OJSC and Gazprom PJSC are delaying some offshore drilling by two to three years because of sanctions and weaker oil prices, according to the country’s Ministry of Natural Resources. The nation will drill two offshore wells in 2017, down from an original plan for 14, Denis Khramov, deputy minister, said Tuesday at a conference in Russia’s Far East. The delay means 28 wells will be drilled in 2019 instead of 19, he said U.S. and European Union sanctions prompted by Russia’s role in the Ukraine crisis have cut access to offshore-drilling technology and equipment, Khramov said. Russia’s efforts to tap its offshore resources, which are estimated at 14 billion to 15 billion metric tons of oil equivalent, are lagging other countries, Khramov said. Russia drilled 11 subsea wells last year, compared with 57 in Norway, he said. The ministry this year approved drilling delays […]

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EU Publishes Details of Tough New Commodity Trading Regulations

LONDON—After months of delays, the European Union on Monday published details of tough new financial regulation for commodities markets, ending more than a year of uncertainty over how the rules will apply. The commodities changes are part of broad legislation conceived in the wake of the financial crisis that is intended to extend regulatory oversight of fixed-income and commodity markets and move more financial instruments onto exchanges. The plans have drawn criticism from national governments and market participants, concerned that the new rules could push up costs and drive out key players, making it harder for airlines and utilities to manage their risks. Commodity-market participants have been particularly concerned about position limits—or curbs on the volume they are able to trade—and whether the new legislation will require them to be authorized as financial firms, making them hold capital in a similar way to banks. According to the technical standards […]

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Gazprom Responds to EU Charges of Hindering Competition, Unfair Pricing

BRUSSELS—OAO Gazprom on Monday sent its response to European Union charges that the Russian energy firm hindered competition and charged unfair prices in Eastern Europe, arguing the case was “economically and legally unfounded.” The response, which was expected by Monday, “shows why we believe the European Commission’s allegations are based on an incorrect methodology,” Gazprom said. It comes a week after Gazprom said it proposed a settlement with EU regulators , a move that could help the company avoid billion-dollar fines. The European Commission, the bloc’s top antitrust authority, said it had received Gazprom’s response and would consider it “carefully…before taking any decision on how to proceed.” The regulator said it was assessing Gazprom’s settlement proposals “in parallel.” The commission in April filed formal charges against Gazprom , saying the state-controlled company broke EU antitrust law in eight countries where it is the dominant gas supplier—Bulgaria, Czech Republic, Estonia, […]

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Report: British North Sea won’t rebound until 2017

British oil and gas sector planner Ian Wood said low crude oil prices will endure through at least 2018. File photo by A.J. Sisco/UPI LONDON, Sept. 28 (UPI) — The British oil and gas sector is in a short-term decline with no chance of recovery for at least two years, an industry planner told the Financial Times. Low crude oil prices, down about 50 percent from last year, has forced energy companies to cut spending on exploration and enact layoffs in an effort to reserve capital. Ian Wood, a retired businessman who last year charted a North Sea recovery, told the Financial Times crude oil prices would likely stay low for at least two more years. "Oil at $35 to $55 [per barrel] is the likely scenario into 2017, and I think the best guess right now for a recovery in the North Sea is 2017-18," he said. Operating […]

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Bearish Ruble Bets Increase as Currency Slides on Crude, Economy

The ruble weakened for the first time in three days as falling crude oil and concern about Russia’s contracting economy prompted hedge funds and other speculators to bet on currency declines for an 11th week. While the ruble has recovered from a record-low close a month ago, it’s still the worst performer among emerging markets this quarter after Brazil’s real with a drop of 16 percent. Natural-gas producers Gazprom PJSC and OAO Novatek pulled the benchmark equities gauge lower on speculation the government will increase taxes on the industry as it seeks to plug the widest budget deficit since 2010. Speculators were net short the ruble for the eleventh week, the longest bearish streak this year, U.S. Commodity Futures Trading Commission data showed on Sept. 25. They increased net ruble short positions to negative 2,543 futures in the week ended Sept. 22, the data, which are reported with a […]

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Russia Reconsiders Tax Proposals to Ease Oil Producer Fears

Russia will weigh lowering oil-export duties at a slower rate than planned instead of raising an extraction tax as the government seeks to plug its budget deficit without hurting the prospects for the country’s biggest crude producers. “The government is considering the variant where the export duty is reduced more slowly,” Natalya Timakova, a spokeswoman for Prime Minister Dmitry Medvedev, told reporters on Monday at his residence outside Moscow. Medvedev decided that Russia won’t make changes to an oil-extraction tax, she said. Finance Ministry plans to raise more than 600 billion rubles ($9.1 billion) of additional tax revenue next year prompted concerns that a higher extraction levy would curb Russian oil production. The collapse in crude prices sees Russia facing its widest budget gap this year since 2010, forcing the government to choose between deeper austerity, tax increases and a freeze on pension-fund contributions. The government had originally planned […]

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Britain’s oil demand is growing again: Kemp

UK petroleum consumption is growing at some of the fastest rates for a decade, as strong economic growth and cheaper fuel prices spur increased use. Consumption of petroleum products rose by 1.6 percent in the first six months of 2015 compared with the same period a year earlier, according to the UK Department of Energy and Climate Change (DECC) ( link.reuters.com/zud75w ). Consumption has been growing consistently since the third quarter of 2014, coinciding with a maturing economic recovery and a sharp drop in oil prices ( link.reuters.com/wud75w ). Like most of the other advanced industrial economies, Britain’s consumption of petroleum products peaked in 2005, then declined sharply as oil prices climbed to more than $140 per barrel in 2008. The recession took another big chunk out of oil consumption, but even as the economy recovered between 2010 and 2014, demand mostly continued to fall as high prices encouraged […]

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Volkswagen Scandal Highlights European Stalling on New Emissions Tests

Photo A Volkswagen factory building in Wolfsburg, Germany. The company installed software in 11 million diesel vehicles to provide false information about emissions. Credit Michael Sohn/Associated Press BRUSSELS — European legislators got a jolt this month in their long-running effort to update auto-emissions standards when a German member of the European Parliament suddenly proposed exempting a whole class of vehicles. “This was a huge loophole, and everyone was asking: Where does this idea come from?” recalled Bas Eickhout, a member of the Dutch Green party who sits on the committee on the Environment, Public Health and Food Safety. It did not take long to discover the origin of the contentious proposal: Volkswagen Group. What had seemed a proposal by a legislator was in reality the work of the German carmaker. This was just one particularly brazen example of how European automobile manufacturers have for years sought to thwart or […]

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Oil prices fall on slowing global economic growth outlook

A gas station worker fuels a vehicle in Tokyo August 26, 2015. Oil prices dropped in early trading in Asia on Monday despite a fourth weekly fall in U.S. drilling activity, with analysts pointing to the weak economic outlook as the main reason for low crude prices. The International Monetary Fund is likely to revise downwards its estimates for global economic growth due to slower growth in emerging economies, IMF head Christine Lagarde said in a newspaper interview. In line with bearish sentiment, Brent crude futures LCOc1 were at $48.27 per barrel at 0024 GMT, down 33 cents from their last close. U.S. West Texas Intermediate (WTI) futures CLc1 were at $45.34 a barrel, down 36 cents. Crude futures are now down over 10 percent since the beginning of the month, and rating agency S&P cut its Brent and WTI forecasts late last week by $5 to $50 per […]

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Oil Declines as Chinese Industrial Data Signal Weakening Demand

Oil halted its advance near $45 a barrel as lower Chinese industrial profits signaled demand may be weakening in the world’s second-biggest consumer. West Texas Intermediate futures fell as much as 1.3 percent after climbing 2.3 percent last week. China’s industrial-company profits dropped 8.8 percent in August, the most in at least four years, while measures of its factory output and U.S. non-farm payrolls data are due later this week. Crude’s rally from a six-year low in August is sputtering on speculation a global glut will persist as Chinese economic growth slows and Iran prepares to boost exports should sanctions against the country be lifted. Oil rose the past two weeks as crude supplies in the U.S. fell while production slipped in six of the past seven weeks with low prices forcing drillers to idle rigs. “The focus has been on weak economic data from China today and apprehension […]

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