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Russia Exporter-Tax Anxiety Spurs Worst Run for Stocks in Year

Russian stocks headed for their longest streak of losses in more than a year as the nation’s biggest oil and mining companies fell on concern they may be targeted in a government drive to extract more taxes to cover a budget shortfall. Uralkali PJSC, Russia’s largest potash company, fell 2.8 percent, contributing to the benchmark Micex Index’s 0.8 percent drop. The gauge has lost almost 7 percent in the last six days, trimming its advance this year to 16 percent. The ruble traded little changed against the dollar at 66.3860 by 5:02 p.m. in Moscow. The ruble’s 50 percent devaluation against the dollar since the start of 2014 has boosted exporters’ foreign-currency earnings and Finance Minister Anton Siluanov on Wednesday said it’s time for the government to take a share of the windfall. While the ministry has proposed boosting the tax on oil companies to bring in more than […]

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Total CEO: Russian Arctic Project Gets Chinese Funding Boost

Yamal LNG, a $27 billion project on a Russian peninsula jutting into the Kara Sea, has been beset by questions over how to pay for it since the lead partner, OAO Novatek , NVTK -3.40 % was hit by U.S. sanctions following Russia’s annexation of Crimea last year. With most western financing cut off, the partners have turned to Chinese state banks for $12 billion in loans but none have been approved yet. The project has become a test of whether complicated, expensive Russian energy developments are possible in an era of stringent American sanctions on the country’s oil-and-gas industry. This month, China’s $40 billion Silk Road Fund said it would finance part of the project, a development Total CEO Patrick Pouyanné called “a clear commitment by China” in an interview Wednesday. The price paid for Silk Road’s 9.9% stake in Yamal wasn’t disclosed. Silk Road, a state-owned infrastructure […]

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Commodities Traders Brace for New European Rules

LONDON—Europe’s commodities traders are warning that new regulations set to be released within days could roil markets and push up costs for a range of essentials from crude oil to chocolate. A final draft of expanded rules governing the European Union’s oversight of financial markets is expected to extend its authority over firms that focus on trading in oil, farm products, industrial metals like copper and a host of other commodities. It would add a new layer of scrutiny for an industry that has historically operated with limited oversight . These companies—like BP BP 0.80 % PLC, Glencore GLNCY -7.01 % PLC and Vitol Group—buy and sell huge volumes of oil and industrial metals on a daily basis, hedging their stocks of raw materials with sizable positions in financial markets. Though it is difficult to quantify just how big they are, Vitol stunned market watchers in 2008 when regulators […]

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Whatever Happened to Peak Oil?

Offshore oil platform image via shutterstock. Reproduced at Resilience.org. Whatever happened to “peak oil” – the assertion that the rate at which oil is extracted from the Earth is nearing a maximum or peak level? With falling oil and gasoline prices and a boom of new oil development in the United States and elsewhere, concern about global oil supplies have faded from public view. But have concerns about peak oil really disappeared? What key factors have changed in the oil industry, and what challenges remain? Are we entering a new era of “abundance” or are the risks of the world’s dependence on oil rising? Guests: Key Questions: Cost : What are the trends regarding costs to maintain global oil production now and in the future? Are costs of developing new oil rising or are fracking and other technologies driving production costs down? Do falling prices mean that oil is […]

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Oil Rebounds as U.S. Inventory Decline Counters Easing Demand

Oil rebounded in New York from its biggest drop in three days as a decline in U.S. crude inventories tempered signs that refinery maintenance is crimping demand. West Texas Intermediate futures advanced as much as 1.5 percent, trimming Wednesday’s 4.1 percent slump. Nationwide crude inventories fell more than the median estimate in a Bloomberg survey, according to data from the Energy Information Administration. Refinery utilization slid 2.2 percentage points while daily crude output climbed by 19,000 barrels to 9.14 million. Even with Thursday’s recovery, oil prices are still down more than 25 percent from this year’s closing peak in June on speculation a global glut will be prolonged. While U.S. crude stockpiles declined for a second week through Sept. 18, they remain almost 100 million barrels above the five-year seasonal average. “Crude stocks fell as imports remained low,” Amrita Sen, chief oil analyst at consultants Energy Aspects Ltd. in […]

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Oil edges up on falling U.S. inventories, but Asia concerns to drag

An oil pump jack can be seen in Cisco, Texas, August 23, 2015. Oil prices edged up early on Wednesday after U.S. crude stocks were estimated to have dropped last week, stripping some supplies out of an oversupplied market that has seen prices more than halve since June 2014. Industry group the American Petroleum Institute reported that U.S. crude stockpiles fell 3.7 million barrels last week, with stocks at the Cushing, Oklahoma delivery point for U.S. crude futures alone down almost 500,000 barrels. [API/S] U.S. West Texas Intermediate (WTI) crude futures CLc1 were trading at $46.56 per barrel at 0051 GMT, up 20 cents from their last settlement. Globally traded Brent futures LCOc1 were at $49.19 per barrel, up 11 cents. But traders said some downward pressure was likely to build during Asian trading. "Oil, like other commodities, is in the middle of a glut. Most say there are […]

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Oil slumps to end at lowest level in over a week

Bloomberg Refinery maintenance season may help crude-oil stockpiles grow. Oil futures ended Wednesday at their lowest level in more than a week, with traders betting that U.S. inventories will soon begin to climb as refineries shutdown for seasonal maintenance. Prices had earlier found support on the back of a second straight weekly decline in U.S. crude supplies, but total domestic production edged a bit higher in the latest week and disappointing Chinese manufacturing data renewed concerns over demand from the world’s second-largest oil consumer. Crude Oil – Electronic (NYMEX) Nov 2015 November West Texas Intermediate crude CLX5, -3.54% settled at $44.48 a barrel, down $1.88, or 4.1% on the New York Mercantile Exchange after earlier tapping a high above $47. Prices settled at their lowest level since Sept. 14. November Brent crude LCOX5, -2.47% on the ICE Futures exchange settled down $1.33, or 2.7%, to $47.75 a barrel. The […]

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Oil unlikely to return to $100 a barrel for years

Oil won’t see $100 for a long time, says OPIS’s Tom Kloza. Traders said goodbye to $100 oil prices a little over a year ago, and they might be staying away even longer than some expect. West Texas Intermediate crude-oil prices won’t likely climb back to $100 a barrel this year, or next, according to Tom Kloza, global head of energy analysis at Oil Price Information Service. ‘Generally, it is difficult to make a case for $100 a barrel oil through the next few years.’ “Anything beyond the realm of the next 18 months smacks of witchcraft rather than real analysis,” he said in an email interview. “Generally, it is difficult to make a case for $100 a barrel oil through the next few years.” Kloza sees a more realistic range between $40 and $60 a barrel for monthly WTI averages over the next 15 months. “Anything north of […]

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Global LNG market is heading toward a surplus, BRG analyst says

Countries attempting to import more LNG could increase an already growing advantage over suppliers worldwide in the next few years, a market analyst suggested. “Demand growth could be slow for the next few years, but as lower prices sink in, it could start to grow,” said Christopher Goncalvez, a managing director in Berkeley Research Group’s Washington office. “Japan is a huge wild card as it ponders whether to reactivate its idled nuclear power capacity. That creates so many uncertainties.” A global LNG surplus already exists, Goncalvez told an audience at the US Energy Association on Sept. 22. “We have become much more conservative with regard to LNG exports,” he said. “We see a range of 44-63 [billion cu m]/year by 2020. There are some variables out there that might possibly drive exports up a bit. But demand won’t be able to keep up with supply for the next decade.” […]

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Oil Market Doldrums Seen Delaying Sanctions for New LNG Projects

The year-long decline in oil prices has taken its toll on new liquefied natural gas (LNG) projects worldwide as upstream petroleum firms reduced capital expenditure (CAPEX), including delaying or even cancelling greenfield developments. Currently, at least 46 major projects – holding approximately 20 billion barrels of oil equivalent in resources – have been deferred due to the market downturn, Wood Mackenzie’s Head of Gas and Power Consulting Rajnish Goswami said Sept. 9 at CWC’s 7th World LNG Series: Asia Pacific Summit in Singapore. “LNG prices are under pressure with near term weak demand. Investments in new LNG supply is under threat and $200 million CAPEX [have been] delayed, many of them gas projects,” he added. Pessimism shrouded the industry, affecting upstream investments, as global oil prices have shown little signs of recovery after falling below the psychologically significant $100 a barrel mark just over a year ago. U.S. crude […]

Posted On : Published By : Tom Whipple