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House move on oil exports moot, White House says

White House Press Secretary Josh Earnest stresses decisions on U.S. crude oil exports rest with the Commerce Department. Photo by Kevin Dietsch/UPI WASHINGTON, Sept. 18 (UPI) — Congressional moves to repeal a crude oil exports ban are irrelevant because those decisions rest with the Commerce Department, the White House said. The House Energy and Commerce Committee approved a measure to lift a ban on U.S. crude oil exports. The ban was enacted in the 1970s after Arab members of the Organization of Petroleum Exporting Countries briefly stopped exporting oil to the United States because of Washington’s support for Israel. Rep. Joe Barton , R-Texas, who introduced the bill, said the U.S. oil boom needs to benefit overseas allies as much as it has the domestic economy. "The ban on exporting crude oil imposes an estimated $200 billion – $600 billion cost to the U.S. economy, discourages crude oil production, […]

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IEA sees high risk in arctic oil

Shell has permit to start drilling into oil-bearing zones in the Burger prospect off the Alaskan coast, described once as one of the bright spots in North America. IEA says risks are too great at the moment. Photo courtesy of the Bureau of Safety and Environmental Enforcement. LONDON, Sept. 18 (UPI) — The incoming executive director of the International Energy Agency said drilling for oil in arctic waters may be geologically and economically prohibitive. "I believe that arctic oil is not for today, and not for tomorrow — maybe for the day after tomorrow," Fatih Birol told The Guardian newspaper in London. "It’s geologically difficult, technologically difficult, lots of environmental challenges, and the cost of production is very, very high, especially if you look at the current oil price levels." The U.S. Bureau of Safety and Environmental Enforcement in August awarded Shell with one permit to start drilling an […]

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Rig numbers not a strong production indicator

Shale oil production in the United States as companies wait for market conditions to improve, analysis finds. File photo by Gary C. Caskey/UPI DENVER, Sept. 18 (UPI) — Even if rig numbers across U.S. shale oil basins hold steady, current economics means production could start to decline, a forecasting unit of Platts reported. Low crude oil prices, down about 50 percent year-on-year, means energy companies have less capital to invest in exploration and production. In Texas, the No. 1 oil producer in the nation, the state energy regulator said the 864 drilling permits awarded in August was 64 percent lower year-on-year. The rig count in North Dakota, the No. 2 oil producer, of 67 is 66 percent lower than this date in 2014. Sami Yahya, an analyst with Bentek, the forecasting unit for Platts, said energy companies are figuring out ways to save money by either drilling en masse […]

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EPA Accuses Volkswagen of Dodging Emissions Rules

WASHINGTON—The U.S. Environmental Protection Agency accused Volkswagen AG VLKAY -4.52 % of deliberately dodging air-pollution rules on nearly half a million cars sold, furthering an Obama administration crackdown on auto makers for flouting regulations intended to reduce tailpipe emissions. The EPA, which unveiled the allegations with the California Air Resources Board, issued a notice on Friday alleging the German auto maker used software in the cars to get around government emissions tests. EPA officials said the software, dubbed a “defeat device,” worked to make 482,000 Volkswagen cars appear cleaner than they were. The Clean Air Act requires vehicle manufacturers to certify to EPA that their products meet federal air-pollution standards. EPA officials said Volkswagen violated two parts of the federal Clean Air Act and could face sizable financial penalties of up to $37,500 per car, or more than $18 billion. But it remained unclear whether the government would seek […]

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U.S. Oil-Rig Count Falls in Latest Week

The U.S. oil-rig count fell by eight to 644 in the latest reporting week, the third-straight decline after six consecutive weeks of increases, according to Baker Hughes Inc. BHI -3.29 % The number of U.S. oil-drilling rigs, which is viewed as a proxy for activity in the oil industry, has fallen sharply since oil prices started falling last year. The rig count dropped for 29 straight weeks before climbing modestly in recent weeks. Despite recent increases, there are still about 50% fewer rigs working since a peak of 1,609 in October. According to Baker Hughes, the number of gas rigs rose by two to 198. The U.S. offshore rig count was 31 in the latest week, unchanged from last week and down 31 from a year earlier. For all rigs, including natural gas, the week’s total was down six to 842.

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Debt service uses a rising share of U.S. onshore oil producers’ operating cash flow

graph of U.S. onshore oil producers’ debt service as a share of operating cash flow, as explained in the article text Source: U.S. Energy Information Administration, based on Evaluate Energy Note: Each quarter represents a rolling four-quarter sum. Results from second-quarter 2015 financial statements of a number of U.S. companies with onshore oil operations suggest continued financial strain for some companies. Low oil prices have significantly reduced cash flow for U.S. oil producers, and to adjust to lower cash flows, companies have reduced capital expenditures and raised more cash from debt and equity. Because of the large amount of debt accumulated from past years, a higher percentage of operating cash flow is being devoted to servicing debt. Debt service payments consist of principal repayment to creditors and typically are fixed in both amount and frequency, agreed upon before a company receives a bank loan or issues a bond. Some […]

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September cargoes help stabilize US West Coast gasoline inventories

With rising imports offsetting depleted production, sources say West Coast gasoline supply is showing signs of stabilization. The US Energy Information Administration reported gasoline imports into the US West Coast rose 48,000 b/d to 111,000 b/d for the week ended September 11. According to cFlow, Platts trade flow software, at least seven gasoline cargoes were in the Los Angeles area or en route for delivery over the past week. That helped offset sagging production and stocks in the region. Weekly production of CARBOB fell 6.7% to 6.79 million barrels for the week ended September 11, according to the California Energy Commission. CARBOB stocks fell 7.2% to 5.1 million barrels. However, one source said the supply problems that have hampered the West Coast all summer seem to have dissipated, at least for now. "The differentials seem stable," he said. "Not much trading going on." The differential for Los Angeles CARBOB […]

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Low price, increased generation use means record year for natural gas: Bentek

Record levels for production, power burn and storage injection will make 2015 a record year for natural gas, Jeff Moore, senior energy analyst at Platts unit Bentek Energy, told attendees Friday at the 38th annual Coal Marketing Days conference in Pittsburgh. Moore said that while coal plant retirements have helped fuel an increase in natural gas generation, the real driver behind in the rise in demand is the commodity’s continued low price. With the Henry Hub price staying below $3/MMBtu, natural gas generation is deployed ahead of coal, Moore said. Bentek data shows that natural gas demand has remained above five-year highs for the entire year and it predicts that trend will continue through the end of 2015. Article continues below… Platts Natural Gas Alert provides global coverage of the major natural gas and LNG markets, including real-time spot market transactions reported as deals are done and key end-of-day […]

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Clinton Would Support End to Oil Export Ban Only With Concessions

Democratic presidential candidate Hillary Clinton says she would support lifting the US ban on crude exports if it meant a move toward cleaner energy. Durham, N.H., Sept 18 (Reuters) – Democratic presidential candidate Hillary Clinton said on Friday she would support lifting the 40-year-old U.S. ban on crude exports only if the measure included concessions from the oil and gas industry to move toward cleaner energy. Clinton said she had not yet seen any legislation on lifting the ban that included concessions from the fossil fuel industry, In the absence of that, "I don’t think the ban should be lifted," Clinton told reporters. The U.S. House of Representatives is expected to pass a measure scrapping the trade restriction in coming weeks, after a panel in the chamber passed the bill on Thursday. Oil drillers say the ban needs to be repealed to keep the domestic energy boom alive. Opponents […]

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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. […]

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US starts carrying out nuke deal as time expires on GOP

AP Photo/Evan Vucci Latest News Moscow urges US to engage Syria, offers military talks US deplores Russia’s decision to shut American Center Comedians build ‘gay bar’ on Russia-owned land in Finland Russia fines French supermarket, Burger King Former Kremlin insider expects 2-year economic downturn var mytd = document.getElementById(‘mytd’); var mydiv = document.getElementById(‘spnrefmoneymarkets’); if (mytd != null) {mytd.innerHTML = spnrefmoneymarkets.innerHTML; mydiv.innerHTML = ”}; Putin gives Roy Jones Jr. Russian citizenship var mytd = document.getElementById(‘mytd’); var mydiv = document.getElementById(‘spnrefmoneymarkets’); if (mytd != null) {mytd.innerHTML = spnrefmoneymarkets.innerHTML; mydiv.innerHTML = ”}; WASHINGTON (AP) — The Obama administration began carrying out the Iran nuclear deal Thursday as time expired on Republican efforts to derail it, appointing a senior diplomat to ensure that Tehran moves further away from bomb-making capability and outlining a months-long process before Western nations will start easing economic sanctions. Senators failed to reach the 60-vote threshold for a measure to keep […]

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U.S. Names Ambassador to Implement Iran Nuclear Deal

WASHINGTON—Secretary of State John Kerry tapped a former ambassador to Poland and career diplomat to lead U.S. efforts to implement the Iranian nuclear accord sealed between six world powers and Iran in July. Mr. Kerry’s pick, Stephen Mull, recently left his post in Poland and is a career foreign-service officer. He will be charged with working to ensure Iran and other partners comply with the steps laid out in the nuclear accord. At one point in his 33-year diplomatic career, he helped to design a U.N. Security Council resolution that enacted nuclear sanctions on Iran. In a statement announcing Mr. Mull’s appointment, Mr. Kerry said the Obama administration would work closely with allies “to deepen our security cooperation and to counter Iran’s destabilizing behavior, including its support for terrorism.” Mr. Kerry added: “These concerns and others related to Iran will continue to have the attention of the highest levels […]

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Buhari’s Backing Tightens Nigeria Central Bank’s Grip on Naira

Investors hoping that Nigeria’s central bank Governor Godwin Emefiele will succumb to pressure to devalue the naira weren’t aware of one crucial factor: he has the backing of President Muhammadu Buhari. In his first public comments on the currency since taking office in May, Buhari, 72, said on Wednesday he opposes a weakening of the currency. His stance endorses Emefiele’s policy of restricting foreign-exchange trading to stabilize the naira despite a plunge in oil revenue in Africa’s biggest crude producer. It also raises questions about the central bank’s independence and puts the two men at odds with foreign investors, local businesses and some members of the Monetary Policy Committee who say the naira is overvalued, deterring capital inflows and hindering economic growth. “There appears to be some unwritten agreement between the presidency and the central bank that the naira will not be devalued, in spite of the deteriorating fundamentals,” […]

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Nigerian States Tap Emergency Fund to Pay Wages Amid Oil Slump

Nigerian states have drawn from a 300-billion naira ($1.5 billion) emergency fund at the central bank and are asking for more money as they struggle to pay civil service salaries after the oil-price slump. Eighteen states have tapped the intervention fund and more requests are being processed, Central Bank of Nigeria Governor Godwin Emefiele said in a statement e-mailed by the presidency on Thursday. Debts worth a total of 574 billion naira have been restructured for 23 states since August, it said. At least half of Nigeria’s 36 states, which rely on monthly federal handouts for the majority of their funding, have been unable to pay bureaucrats’ wages after Brent crude prices fell by half in the past year. Nigeria is Africa’s largest oil producer.

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These Are the African Nations Most Exposed to China’s Slump

China’s slowdown is rippling across Africa and these three nations are the most exposed, relying on demand from the Asian economy for almost half their exports: Republic of Congo, Angola and Mauritania. Oil accounts for the bulk of Angola’s and Congo’s exports, damaging their prospects after crude prices plunged 55 percent since the beginning of June last year to below $50 a barrel. The price of iron ore, which makes up more than 40 percent of Mauritania’s exports, has dropped by almost a third in the past year. The three nations each shipped more than 45 percent of their exports in 2014 to China, data from the International Monetary Fund shows. “For countries like Angola, which basically only has one commodity, there is a huge knock when prices fall and less oil is being exported to China,” Christie Viljoen, an economist at NKC African Economics, said by phone from […]

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Coal use in China is slowing

U.S. Energy Information Administration, China National Bureau of Statistics (NBS) Source: Economic deceleration, industry restructuring, and new energy and environmental policies have slowed the growth of coal consumption in China and are also driving more centralized and cleaner uses of coal. After nearly a decade of rapid growth, energy-based consumption of coal, which currently supplies two-thirds of China’s overall energy use, grew only 1% to 2% in 2012 and 2013 and was essentially flat in 2014. Total energy consumption in China has slowed as its economic growth has eased and as the composition of gross domestic product (GDP) has shifted. In 2013, the service sector share (47%) of GDP surpassed the industry sector share (44%) for the first time in Chinese history. The service sector share increased to 48% in 2014, already exceeding the government’s 47% goal for 2015. Policies to accelerate the development of service industries are likely […]

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China to continue crackdowns on illegal share sales and speculative trading

China’s securities regulator said on Friday it would continue its crackdowns on illegal share sales and speculative trading, having recently probed 19 such cases. The China Securities Regulatory Commission said that in one of the cases, major shareholders of a company reduced stakes in their company worth 900 million yuan ($141.45 million). China has banned major shareholders from reducing stakes over the next six months in a bid to reduce selling pressure in its volatile stock market. (Reporting by Samuel Shen and Pete Sweeney ; editing by Simon Cameron-Moore )

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Citi Says China Going Green Will Hurt Industrial Commodities

China’s demand for industrial commodities will probably be hurt as the biggest energy and metals user intensifies efforts to rein in pollution, according to Citigroup Inc. The country will focus on the environment as never before in its forthcoming 13th Five-Year Plan and may start a carbon trading program next year or the year after, Citigroup said in a report on Friday. Costs for energy-intensive industries will increase, with steel and electricity likely to be the first to implement the scheme, the bank said. Now the world’s biggest carbon emitter, China is moving to address the environmental damage that’s been a byproduct of its breakneck economic expansion. Xi Jinping’s first five-year plan since becoming president in March 2013 will chart the path for the nation’s further development. It’s expected to be delivered at the time of the Communist Party Plenum in October. “Environmental initiatives are likely to be among […]

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China’s Strategy in U.S. Car Market: Make Parts First

A two-year-old factory near Kansas City gives a good look at China’s strategy for becoming a global force in autos. The Riverside, Mo., plant’s operator is controlled by China’s No. 1 auto maker, but the factory doesn’t build cars. Its about 200 workers assemble door handles, center consoles and other parts that ship to a nearby General Motors Co. GM 0.35 % factory, which fits them into Chevrolet Malibu sedans. Beijing’s industrial planners have identified car-parts plants like this as a vehicle into the world’s auto markets. By first learning to make and sell car parts in markets like the U.S., leaders in China’s auto industry say, companies can then use the lessons to move on to selling cars overseas. “By running factories there and hiring local people” in the U.S., says Dong Yang, a vice president of the government-backed China Association of Automobile Manufacturers, “it will pave the […]

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BHP Billiton Sees Rocky Outlook for Coal

A multiyear downturn in the energy commodity, used to generate electricity and make steel, is worsening as miners continue to produce too much supply and China’s economy slows, said Mike Henry. China’s restrictions on certain types of highly polluting coa l, introduced earlier this year as part of an accelerating campaign to clean up its air, have added to a significant glut in the global market for the fuel, the mining executive said on Friday. “There are no signs of things getting better in the immediate term,” he said during a speech in Brisbane, Australia, according to prepared remarks. Coal prices have been tumbling since 2011 as cooling demand for the fuel was met by rising supplies from new mines planned when the market was booming. Price declines have deepened this year. The value of metallurgical coal, which is burned for steelmaking, is down as much as 30% from […]

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An Oklahoma of Oil at Risk as Debt Shackles U.S. Shale Drillers

Photographer: Brittany Sowacke/Bloomberg As much as 400,000 barrels a day of oil production is at risk as U.S. shale companies like Samson Resources Co. run out of money and are forced to slow drilling. Total debt for half of the companies in a Bloomberg index of more than 60 producers has risen to a level that represents 40 percent of their enterprise value. It’s a sign of distress that shows equity values falling in the face of oil’s crash, said Rob Thummel, a managing director and portfolio manager at Tortoise Capital Advisors LLC who helps manage $15.6 billion. The companies facing high debt loads, which include Encana Corp. and Chesapeake Energy Corp., produced 1.1 million barrels of oil a day in the second quarter of this year, according to data compiled by Bloomberg. If more companies file for bankruptcy as Samson did Wednesday, or embrace the kinds of draconian […]

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House Democrats Keep Door Open to Crude Exports, Seek Sweeteners

House Democrats said a measure to repeal decades-old U.S. restrictions on crude oil exports needs more environmental and consumer protections to win their backing. The Republican-led House Energy and Commerce Committee passed the measure by a 31-19 vote Thursday, sending the legislation to the full House of Representatives. Three Democrats joined 28 Republicans voting in favor. A floor vote could come as soon as the end of the month. The bill cleared the committee with one amendment, which would allow the U.S. president to reimpose export restrictions during a national emergency. “I frankly don’t see what’s in this for the average American,” Representative Frank Pallone of New Jersey, the panel’s Democratic leader, said before the vote. The bill “is a blunt object which broadly undermines 40 years of protections for national security, our economy, consumers and the environment.” U.S. exports of most crude oil were banned by Congress in […]

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Does Anyone Even Want to Buy Crude Oil From the U.S.?

Given current prices, does anyone even want to buy crude oil from the U.S.? After the House Energy and Commerce Committee voted to end a four-decade ban on most oil exports, crude in the U.S. remains more expensive than foreign supplies and domestic demand is robust. Supporters of expanded exports, including Exxon Mobil Corp. and ConocoPhillips, say ending the ban would ease a glut from the shale boom and lower global prices. Refiners opposed to the legislation say it could increase gasoline costs for U.S. consumers. Lifting the ban won’t lead to a big jump in shipments, at least in the short term, said John Auers, executive vice president at energy consultant Turner, Mason & Co. Light oil in Louisiana was more than $2 a barrel more expensive Wednesday than Brent, the international benchmark, making it unattractive for overseas refiners seeking to capitalize on the shale boom. Refineries in […]

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BHP adds voice to U.S. oil export debate

Both sides of the U.S. energy sector — upstream and downstream — continue debate over wisdom of repealing ban on crude oil exports. Photo by iofoto/Shutterstock WASHINGTON, Sept. 17 (UPI) — Australian energy giant BHP Billiton said the United States could send a strong message to allies and markets alike with a repeal of the ban on oil exports. Republican leaders in the U.S. House and Senate have moved legislation meant to end the ban placed on U.S. crude oil exports after Arab members of the Organization of Petroleum Exporting Countries in the 1970s blocked their exports to the United States in response to Washington’s support for Israel. Addressing the U.S. Chamber of Commerce in Washington, BHP Chief Executive Officer Andrew Mackenzie said a larger U.S. presence on the global energy market could have significant consequences . "The United States would send a strong signal with the repeal of […]

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Canadian gas exports to U.S. plummet

Canadian energy regulators reports gas exports to the United States are down dramatically. Photo by Heather Snow/Shutterstock CALGARY, Alberta, Sept. 17 (UPI) — Canadian natural gas exports to the United States for the seven years ending in 2014 are down significantly because of U.S. shale production, a regulator said. The National Energy Board said in a market snapshot natural gas exports are down dramatically. For the eastern United States, exports are down more than 65 percent for the seven years ending 2014. For the market in the U.S. Midwest, natural gas exports are down nearly 23 percent through 2014. "Rapid development of unconventional gas projects has increased U.S. natural gas production," the NEB said. "As a result, natural gas exports from Canada to the U.S. have been decreasing." NEB said pipeline revisions have shifted exports away from Midwest markets as well. Canada relies heavily on export revenue from oil […]

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US House committee passes crude oil export bill, but hurdles remain

The US House Energy and Commerce Committee on Thursday approved a bill to lift all restrictions on US crude oil exports by a 31-19 vote. While it could be voted on by the full House later this month, the bill’s path in the Senate remains unclear and it faces opposition from the White House, limiting the likelihood that an export policy change could become law before President Barack Obama leaves office in 2017. On Tuesday, White House spokesman Josh Earnest said the administration "wouldn’t support" the crude export bill because such a policy change should be made by the Department of Commerce. A Commerce spokesman said Wednesday that the agency was not working to change current export policy, which restricts US crude exports with some exceptions. The bill Thursday, H.R. 702, was approved by all committee Republicans, but just three Democrats: Representatives Gene Green of Texas, Tony Cardenas of […]

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Falling production is underpinning U.S. oil prices: Kemp

An oil pump jack can be seen in Cisco, Texas, August 23, 2015. U.S. crude oil production is falling sharply, helping put a floor beneath U.S. domestic crude prices and causing them to rise relative to the international marker Brent. In the face of lower prices, the U.S. oil boom has stalled and the industry is facing the sharpest setback in production for decades, excluding hurricane periods ( link.reuters.com/kyj65w ). According to the U.S. Energy Information Administration (EIA), U.S. crude and condensate output peaked at 9.612 million barrels per day (bpd) in April and had declined by 316,000 bpd by June. Production continued to rise in North Dakota (36,000 bpd) but in most other states and offshore areas output turned down ( link.reuters.com/vuj65w ). The largest declines were reported in Texas (129,000 bpd), the Gulf of Mexico (90,000 bpd), West Coast offshore (28,000), Alaska (27,000 bpd) and California (18,000 […]

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Is This The End Of The U.S Shale Gas Revolution

While everyone is watching the oil bust, there is another bust going on – one for natural gas. Before there was a boom in oil production in the United States, there was the “shale gas revolution.” That is where we all became familiar with terms like “fracking.” And the Marcellus, Haynesville, and Barnett Shales were famous long before the Bakken or Permian. The surge in natural gas production crashed prices, fueling a huge increase in activity in petrochemicals and causing a major switch from coal to natural gas in the electric power industry. Aside from a few brief moments (such as the winter of 2014), natural gas has mostly traded around $4 per million Btu (MMBtu) or lower since the financial crisis of 2008. (Click to enlarge) But unlike oil, the boom in shale gas did not stop with plummeting prices. U.S. natural gas production continued to climb. For […]

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World’s First Subsea Gas Compression Plant Now Online

Statoil ASA announced Thursday that the world’s first subsea gas compression plant is now online at the Åsgard field in the Norwegian Sea. The move is a step closer to Statoil’s goal of achieving a complete subsea processing plant (or "subsea factory" ). Statoil said that the recovery from the Midgard reservoir on Åsgard will increase from 67 percent to 87 percent, while recovery from the Mikkel reservoir will improve from 59 percent to 84 percent, as a result of the new facility. The overall effect will be to add some 306 million barrels of oil equivalent to the total output of Åsgard during the field’s life. Statoil began the $2.3-billion project in 2005 and an estimated 11 million man-hours have been spent on it from start to completion. The firm said that more than 40 new technologies have been developed and employed as part of the installation. Compression […]

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Robert Rapier: Peak Oil is a Function of Oil Price

The Origins of Peak Oil Awareness The scientific study of peak oil began in the 1950′s, when Shell geophysicist M. King Hubbert reported on the evolution of production rates in oil and gas fields. In a 1956 paper Hubbert suggested that oil production in a particular region would approximate a bell curve, increasing exponentially during the early stages of production before eventually slowing, reaching a peak when approximately half of a field had been extracted, and then going into terminal production decline. Hubbert applied his methodology to oil production for the Lower 48 US states and offshore areas. He estimated that the ultimate potential reserve of the Lower 48 US states and offshore areas was 150 billion barrels of oil. Based on that reserve estimate, the 6.6 million barrels per day (bpd) extraction rate in 1955, and the 52.5 billion barrels of oil that had been previously produced in […]

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Brent crude oil edges above $50 after U.S. stockdraw, lower production

SINGAPORE – Brent crude oil prices edged above $50 per barrel for the first time in a week on Thursday as lower stocks in the United States and peaking production by some producers appeared to help reduce huge oversupply, although Asia’s economies showed new signs of weakness. CHICAGO – A U.S. Agriculture Department (USDA) unit is reviewing its procedures after posting incorrect crop data online on Wednesday, an error that temporarily pressured grain prices. HOUSTON – Easy money, super-sized frack jobs, and desperate drillers offering deep discounts to oil producers – all three have been credited for sustaining U.S. crude output during the worst price slump in six years. SINGAPORE – Gold was trading near its highest in a week on Thursday, adding to overnight gains from its biggest jump in nearly a month, as sluggish U.S. inflation data eased fears the Federal Reserve would hike interest rates later […]

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Oil Prices Steady Ahead of U.S. Fed Rate Decision

By Jenny W. Hsu Oil prices were largely stagnant in Asian trade Thursday as market participants remained on the sidelines awaiting the U.S. Federal Reserve’s decision on interest rates. Most traders are keeping a close eye on the outcome of the Federal Reserve meeting with the expectation that the U.S. government will stand pat on interest rates due to continuing concerns about the global economy and recent volatility in Chinese equity markets. Softer U.S. inflation data released overnight also makes a rate increase less likely. Global markets were generally higher, while the U.S. dollar is under some pressure ahead of the Fed briefing. U.S. stocks closed higher Wednesday, helping boost sentiment as most Asian markets gained Thursday, with the Shanghai Composite was last up around 0.5%. On the New York Mercantile Exchange, light, sweet crude futures for delivery in October traded at $47.12 a barrel at 0418 GMT, down […]

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IEA: Age of LNG in question

International Energy Agency says short-term planning may jeopardize growth in the LNG industry. File photo by Stephen Shaver/UPI TOKYO, Sept. 16 (UPI) — Short-term planning from energy policymakers might keep liquefied natural gas off the global stage, the IEA director said during a visit to Tokyo. "If it can compete, then there is a great chance for gas to become a major and relatively clean contributor to energy security," Fatih Birol , the executive director of the International Energy Agency, said during a speech from Japan. "But the current low prices provide only a temporary window of opportunity — an opportunity that policy makers and the industry must seize." The IEA said liquefied natural gas, a super-cooled and denser product with more deliverability options, represents "a golden opportunity" for Asian economies. Asian demand for natural gas is expected to grow steadily through the end of the decade, according to […]

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Iraq: 2 suicide attacks in Baghdad kill at least 14 people

AP Photo/Hadi Mizban BAGHDAD (AP) — Two suicide attackers targeted Iraqi police checkpoints in commercial areas in central Baghdad during rush hour Thursday, killing at least 14 people, officials said. Both attacks were carried out by bombers on foot, wearing explosives-laden vests, two police officers said. One bomber struck in Baghdad’s Bab al-Sharji area, killing eight civilians and a police officer there. Twenty-one were wounded in that explosion. The second bomber hit in al-Wathba Square, killing five people, including two policemen, and wounding 12. Two medical officials confirmed the casualty figures. All officials spoke on condition of anonymity because they are not authorized to talk to reporters. Iraq is going through its worst crisis since the 2011 withdrawal of U.S. troops. The Islamic State group controls large swaths of the country’s north and west after capturing Iraq’s second-largest city of Mosul and the majority of the western Anbar province […]

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OPEC’s new medium-term forecasts show higher demand for its oil: delegates

The logo of the Organization of the Petroleum Exporting Countries (OPEC) is pictured at its headquarters in Vienna, Austria, August 21, 2015. OPEC’s new medium-term forecasts point to higher demand for the group’s oil, OPEC delegates said, a sign that its strategy of letting prices fall is discouraging supplies from competing producers. The forecasts, to be published in OPEC’s World Oil Outlook later this year, are expected to be discussed on Thursday during the second day of a meeting of OPEC’s national representatives taking place at its Vienna headquarters. "The new medium-term numbers show a higher demand for OPEC crude," said one OPEC delegate, who added that oil prices are assumed to be lower than previously. "There is an impact on higher-cost producers." OPEC’s 2014 World Oil Outlook expected demand for its oil to fall to 28.50 million barrels per day (bpd) in 2016 from 30 million bpd in […]

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Conditions seen worsening for majors until late 2016

Fundamental business conditions for integrated oil and gas companies will worsen before signs of improvement appear late next year, according to a Moody’s Investors Service assessment based on reduced expectations for crude oil and natural gas prices ( OGJ Online, Aug. 7, 2015 ). Moody’s expects earnings before interest, taxes, depreciation, and amortization (EBITDA) for the global integrated oil and gas industry to contract by 20% or more this year and to recover only modestly in 2016. “This view is based on our expectations of revenue and cash flow declines and a negative free cash flow profile for the industry in 2015,” the firm says. “We expect the industry’s free cash flow to remain negative in 2016.” Free cash flow is the difference between cash flow from operations and investments. Moody’s expects total free cash flow for the integrated companies it rates to be negative by as much as […]

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Nigerian firms may struggle to repay debt if dollar shortages persist

* Oil price plunge hits Nigerian revenues, currency * Central bank rations dollars to hold naira peg * Yields on some Nigerian Eurobonds near record * Loans, dividends may be more problematic than bonds By Alexis Akwagyiram and Karin Strohecker LAGOS/LONDON, Sept 16 (Reuters) – Already feeling the pinch from slumping oil prices and slowing economic growth, Nigerian companies are finding it increasingly hard to get hold of foreign currency due to central bank restrictions and may struggle to repay their debts. Yields on a number of dollar corporate bonds have risen close to record highs this week, reflecting investors’ anxiety despite an assertion by Nigeria’s richest businessman that no borrower will default due to the currency shortage. Since 2007, Nigerian financial and energy firms such as FBN Holdings and Seven Energy have issued more than $5 billion of dollar-denominated debt on international capital markets, including almost $3 billion […]

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Nigeria: Investigation – Jonathan, Alison-Madueke, Tunde Ayeni, Named in Fraudulent Oil Contracts That Cost Nigeria Billions

PREMIUM TIMES has uncovered one of the most fraudulent crude oil deals carried out by the administration of Goodluck Jonathan, which saw cronies of the president pocket billions of naira through a domestic crude oil transportation contract that violated Nigeria’s procurement and economic regulations. Our estimates indicate that the contracts, which the Nigerian National Petroleum Corporation has now admitted were unnecessarily exorbitant and inappropriately awarded, cost Nigeria N509.3 billion. How much service the companies offered to pocket that amount remains unclear even to the state oil company, insiders say. The deal, later disguised as security contract and channeled through the Nigerian National Petroleum Corporation, saw two companies belonging to Idahosa Okunbor and Tunde Ayeni, illegally rack up billions of naira to purportedly transport crude oil from Escravos to Warri refinery, and Bonny Island to Port Harcourt refinery, by ship, since 2011. The deal involved the transportation of five millions […]

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Oil production starts from Erha North Phase 2 offshore Nigeria

Esso Exploration & Production Nigeria Ltd. , a subsidiary of ExxonMobil Corp., has started oil production ahead of schedule at the Erha North Phase 2 project 60 miles offshore Nigeria ( OGJ Online, June 23, 2015 ). The deepwater subsea development lies in 3,300 ft of water and 4 miles north of Erha field, which has been producing since 2006 ( OGJ Online, May 2, 2006 ). The project includes seven wells from three drill centers tied back to the existing Erha North floating production, storage, and offloading vessel, reducing additional infrastructure requirements. Phase 2 is estimated to develop an additional 165 million bbl from the currently producing Erha North field. Peak production from the expansion is estimated at 65,000 bo/d, increasing total field production to 90,000 b/d. ExxonMobil expects to increase its global production volumes this year by 2% to 4.1 million boe/d, driven by 7% liquids growth. […]

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Recent statistical revisions suggest higher historical coal consumption in China

U.S. Energy Information Administration, China National Bureau of Statistics (NBS) Source: Note: Revised data from or implied by China Statistical Abstract 2015; previously reported data from China Statistical Yearbook 2014 . The values for coal reflect its lower heating value. New preliminary data from the China Statistical Abstract 2015 (CSA2015) show an upward revision to China’s historical coal consumption and production. Energy-content-based coal consumption from 2000 to 2013 is up to 14% higher than previously reported, while coal production is up to 7% higher. These revisions also affect China’s total primary energy consumption and production, which are also higher than previously reported—up to 11% and 7% in some years, respectively, mainly because of the revisions to coal. In 2014, energy-content-based coal consumption was essentially flat, and production declined by 2.6%. China’s National Bureau of Statistics (NBS) typically publishes the CSA in May. The CSA provides annual total primary energy […]

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