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Russia Said to Study Oil-Tax Increase to Cut 2016 Budget Gap

The Russian government may raise taxes on its main source of revenue — crude producers — to narrow its budget deficit next year, two people with knowledge of the matter said Friday. The authorities in Moscow have started discussions with companies about changing a crude-extraction tax formula, one of the people said. Both asked not to be identified because the information isn’t public yet. Modifications are also possible in the export duty formula, the news service Interfax reported, citing an unidentified person familiar with the situation. Together with the extraction levy, that would raise the tax burden on oil producers by about 600 billion rubles ($9.04 billion), according to Interfax. "The producers haven’t been impacted by the drop in prices while the government take has fallen a great deal," said Sarah Emerson, managing director of ESAI Energy Inc., a consulting company in Wakefield, Massachusetts. "We won’t know if there […]

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Statoil making headway with Johan Sverdrup

Statoil says equipment used for giant Johan Sverdrup reserve field could led to a recovery rate that’s nearly twice as much as the global average. Photo courtesy of Harald Pettersen/Statoil STAVANGER, Norway, Sept. 18 (UPI) — Norwegian energy company Statoil said it awarded a contract for equipment that will help ensure maximum resource recovery from the Johan Sverdrup field. Statoil awarded a contract to equipment manufacturer FMC Technologies to build the subsea portions for the development of the Johan Sverdrup field. "The subsea equipment enables reinjection of sea water and produced water into the Johan Sverdrup reservoir when we have started production," Kjetel Digre, Statoil’s vice president for development, said in a statement. "In this way, we will achieve maximum recovery and value creation from the Johan Sverdrup resources." First oil is expected late 2019. Statoil said the first phase of operations at the offshore field should yield up […]

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Electric-Car Perks Put Norway in a Pinch

FINNØY, Norway—When Arne Nordbø drove his electric car under the toll gantry and into the mouth of a tunnel leading to this small Norwegian island on a recent Monday, he couldn’t repress a chuckle. “They’ve just lost another $20,” said the Finnøy resident and occasional stand-up comedian. On the losing side of Mr. Nordbø’s commute are local municipalities, including Finnøy, which went into debt to dig the $70 million tunnel but charge no fee on electric cars because of national policies aimed at curbing carbon emissions. The incentive helped convince many islanders to shift to electric cars. The vehicles now account for about a quarter of tunnel traffic, and allow owners to dodge one of the heaviest toll burdens in the country. For the Finnøy mayor, however, the math looks awry. “That doesn’t work in the long term,” says Gro Skartveit, who doubles as chairwoman of the company operating […]

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Oil prices weak on economic concerns, OPEC target on market share

A service truck drives past an oil well on the Fort Berthold Indian Reservation in North Dakota, November 1, 2014. Oil markets were weak on Friday as fresh signs that OPEC will continue to value market share over prices outweighed expectations of a lift when the United States kept interest rates at historic lows. U.S. West Texas Intermediate (WTI) crude futures were trading at $46.74 per barrel at 0535 GMT, down 16 cents from their last settlement. Brent prices were at $49.12 per barrel, up 4 cents. Kuwait, a key producer of the Organization of the Petroleum Exporting Countries (OPEC), said on Thursday the oil market would balance itself but that this would take time, indicating support for the group’s policy of defending market share despite falling prices. Other sources at OPEC backed this view saying they expected oil prices to rise by no more than $5 a barrel […]

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U.S. Oil Prices Settle Lower After Fed Decision

NEW YORK—Oil prices wavered, then settled lower after the U.S. Federal Reserve opted to keep interest rates unchanged. The central bank’s decision weakened the dollar, supporting the oil market. A weaker dollar makes oil—which is traded in dollars—cheaper for buyers using foreign currencies. However, the Fed’s decision indicated it has concerns about global economic growth, which could limit oil demand. The global oil market remains oversupplied, and investors say production is likely to continue to outpace consumption through the end of this year. “If you’re not going to get a significant improvement in global growth, it’s hard to say demand closes the gap very quickly,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, which oversees $127 billion. “Even with a weaker dollar, in the short run, you still have a lot of supply.” Light, sweet crude for October delivery settled down 25 cents, or 0.5%, at […]

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Oil falls in volatile trade after Fed leaves rate unchanged

A service truck drives past an oil well on the Fort Berthold Indian Reservation in North Dakota, November 1, 2014. Global oil futures fell Thursday, resuming their slide after a brief spike following the Federal Reserve’s announcement that it would leave U.S. interest rates unchanged. Economists saw about a one-in-four chance of a rate increase. The dollar eased ahead of the announcement. A weaker U.S. currency can be supportive to dollar-denominated commodities like oil. Both U.S. crude and Brent extended losses ahead of the 2 p.m. EDT announcement. After the decision was announced, U.S. crude darted into positive territory while Brent pared losses. Within 10 minutes, both benchmarks relinquished gains. The CBOE oil volatility index fell ahead of the announcement but jumped nearly 15 percent in the minute after the decision. It traded more than 9 percent lower in the day by crude oil settlement. Many in the market […]

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OPEC sees oil prices returning to $80/barrel by 2020

The logo of the Organization of the Petroleum Exporting Countries (OPEC) is pictured at its headquarters in Vienna, Austria, August 21, 2015. OPEC forecasters expect oil prices will rise by no more than $5 a barrel a year to reach $80 by 2020, with a slowing in rival non-OPEC production growth not enough to absorb the current oil glut, according to OPEC sources. The sources said the figures came from an updated mid-term strategy report discussed this week by representatives from the Organization of the Petroleum Exporting Countries (OPEC) in Vienna, which has yet to be fully endorsed by OPEC ministers. The report forecasts that non-OPEC supply would amount to 58.2 million barrels per day by 2017, some 1 million barrels per day lower than in the previous forecast. That effectively means OPEC will have to supply the world with 1 million extra barrels per day – good news […]

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OPEC Assumes Oil Price Will Recover Gradually to $80 in 2020

OPEC is assuming the oil price will rise gradually to $80 a barrel in 2020 as supply growth outside the group weakens, a slower recovery than several member nations have said they need. The average selling price of the Organization of Petroleum Exporting Countries’ crude will increase by about $5 annually to 2020 from $55 this year, according to an internal research report from the group seen by Bloomberg News. Iran and Venezuela said they would like to see a price of at least $70 this month and most member countries cannot balance their budgets at current prices. “It’s much harder for OPEC to lift prices” after the revolution of U.S. shale oil, said Bjarne Schieldrop, Oslo-based chief commodities analyst at SEB AB, which forecasts Brent crude at $73 by the end of the decade. “Eighty dollars by 2020 is pretty close to consensus view.” The price of crude […]

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Saudi Aramco Says Nasser New CEO of World’s Biggest Oil Firm

Amin al-Nasser was named president and chief executive officer of Saudi Arabian Oil Co., as part of leadership changes at the world’s biggest oil company overseen by a newly created supreme council headed by the Saudi king’s son. Saudi Aramco’s supreme council also approved a five-year business plan at its first meeting in Jeddah, the state-owned company said in an e-mailed statement Thursday. Nasser in May was named interim CEO, replacing Khalid Al-Falih who became chairman and health minister. The supreme council is restructuring the Dhahran-based company which is no longer under the oil ministry. Nasser is also on the board, below the supreme council. “More appointments are expected,” Mohamed Ramady, a London-based independent analyst and former professor of economics at King Fahd University for Petroleum and Minerals in Dhahran, said by e-mail. “Many senior vice presidents retired lately and no replacements have been announced so far.” Saudi Aramco […]

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Last bid to kill Iran nuclear deal blocked in Senate

Speaker of the House John Boehner (R-OH) pauses during a news conference on Capitol Hill in Washington, in this September 10, 2015 photograph. U.S. Senate Democrats on Thursday blocked legislation meant to kill the Iran nuclear deal for a third time, securing perhaps the greatest foreign policy win of President Barack Obama’s six years in office and clearing the way to implement the accord. By a 56-42 vote, the Republican-majority Senate fell short of the 60 votes needed to advance in the 100-member chamber. Despite an intense and expensive lobbying effort against it, all but four of Obama’s fellow Democrats backed the nuclear pact between the United States, five other world powers and Tehran announced in July. With no more Senate votes this week, the result ensured Congress will not pass a resolution of disapproval that would have crippled the deal by eliminating Obama’s ability to waive many sanctions. […]

Posted On : Published By : Tom Whipple