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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 […]

Posted On : Published By : Tom Whipple
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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 […]

Posted On : Published By : ASPO-USA
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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 […]

Posted On : Published By : Tom Whipple