Looking Back 10 Years After Peak Oil
All views expressed here are those of Verwimp Bruno and do not necessarily represent those of Ron Patterson. 1. INTRODUCTION Peak Oil is the moment in time when, on a global scale, the maximum rate of oil production is reached. The moment after which oil production, by nature, must decline forever. Since Earth is a closed system, next to this production (supply) event, there must be an equal demand event: Peak Oil Consumption. Since there are no substantial above ground deposits, Peak Oil Production and Peak Oil Consumption must coincide. The world consists of a lot of different countries, some of which are already far beyond peak oil production That leads to the assumption the world as a whole reaches peak oil production. On the demand side, it is worth looking, because different countries have different economies, different degrees of development, and so on, if, while some countries still […]
Oil prices weak as demand seen sagging toward year-end
A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. Crude oil prices remained weak on Monday as a slowing demand outlook implied oversupply will remain in place for months, prompting speculators to cut their bets on rising prices. Front-month U.S. crude futures were trading at $44.69 per barrel at 1.57 a.m. ET, 9 cents above their last close but more than 12 percent below their October peak. International benchmark Brent was 8 cents higher at $48.07 a barrel, but over 10 percent below this month’s high. Goldman Sachs said that oil prices could drop "sharply lower" as refined product storage sites come close to filling, stoking a glut that has already seen crude prices fall by more than half since June 2014. ANZ said it expected prices to remain low for the rest of this year, due to […]
Oil Swings Near 4-Week Low as Rig Data Counters China Rate Cut
Oil swung between gains and losses near the lowest closing price in almost four weeks as investors weighed a slowing pace of U.S. drilling-rig reductions against an interest rate cut in China. Futures in New York rose as much as 0.5 percent and fell as much as 0.4 percent. The number of active machines targeting oil dropped by 1 through Oct. 23 after declining by 45 over the prior three weeks, according to Baker Hughes Inc. China, the world’s second-biggest crude consumer, stepped up monetary easing with its sixth interest-rate cut in a year on Friday to combat deflationary pressures and a slowing economy. Oil is failing to sustain a rally earlier this month above $50 a barrel as surging U.S. inventories bolstered speculation that a global glut will be prolonged. World crude supplies will remain ample until at least the middle of 2016 while investments in the industry […]
Oil prices could go ‘sharply lower’ as product inventories near maximum capacity: Goldman Sachs
A crude oil tower is seen on the seashore in Kyaukpyu township, Rakhine state, Myanmar October 5, 2015. Crude oil prices could drop sharply lower as refined product storage sites come close to maximum capacity, further adding to a glut that has already seen crude prices fall by more than half since June 2014, Goldman Sachs said. Although "tank tops" – a term referring to storage capacities hitting their maximum – were unlikely, Goldman said that inventories were already "too close for comfort", bearing the potential for a sharp fall in crude prices. "Distillate storage utilization in the U.S. and Europe is nearing historically high levels, following near record refinery utilization, only modest demand growth (especially relative to gasoline), and increased imports from the East on refinery expansion and Chinese exports," Goldman Sachs said. "This raises the specter of 1998 (and) 2009 when distillate storage hit capacity, pushing runs […]
Governments shouldn’t count on low oil prices: IEA
Towers and smokestacks are silhouetted at an oil refinery in Melbourne June 21, 2010. Countries should not bank on oil prices remaining low when formulating their energy policies, as supplies could tighten from mid-2016 due to a drop in investment and falling U.S. output, a senior industry official said on Monday. Global oil prices LCOc1 have more than halved since June 2014 on rising U.S. shale oil output and as members of the Organization of the Petroleum Exporting Countries (OPEC) decided to defend market share rather than cut production. "It will be a great mistake to index our attention to oil security to the oil price trajectory in the short term," Fatih Birol, executive director of the International Energy Agency (IEA), said at the Singapore International Energy Week. If prices continued at current levels, oil investment was likely to decline again in 2016, mainly in high-cost regions, after sliding […]
Global Trade Is Collapsing
When the global economy is doing well, the amount of stuff that is imported and exported around the world goes up, and when the global economy is in recession, the amount of stuff that is imported and exported around the world goes down. It is just basic economics. Governments around the world have become very adept at manipulating other measures of economic activity such as GDP, but the trade numbers are more difficult to fudge. Today, China accounts for more global trade than anyone else on the entire planet, and we have just learned that Chinese exports and Chinese imports are both collapsing right now. But this is just part of a larger trend. As I discussed the other day , British banking giant HSBC has reported that total global trade is down 8.4 percent so far in 2015, and global GDP expressed in U.S. dollars is down 3.4 […]
Iran Proposes to Swap Oil, Gas With Russia
Iran has proposed to swap oil and gas with Russia , Press TV quoted oil minister Bijan Zangeneh as saying. Zangeneh said the proposal was raised during a meeting on Wednesday with the visiting Russian energy minister Alexander Novak. According to the proposal, Iran would receive natural gas, oil and oil products from Russia through its northern terminals and will sell equivalent volumes of the same products to Russia’s clients through its southern terminals, Press TV reported. Zangeneh suggested that Iran and Russia have adequate facilities to proceed with this swap mechanism. Tehran has been using a similar mechanism with Turkmenistan, Kazakhstan and Azerbaijan for over a decade through which it would receive oil from the three Caspian states at its Neka terminal and would deliver equal amounts with similar specifications to their clients at its southern ports.
Saudi Arabia: Eight of King Salman’s 11 surviving brothers want to oust him
King Salman bin Abdulaziz al-Saud at the Arab League summit in Sharm el-Sheikh in Egypt in March. He took over the Saudi throne in January Eight of the 12 surviving sons of Saudi Arabia’s founding monarch are supporting a move to oust King Salman, 79, the country’s ailing ruler, and replace him with his 73-year-old brother, according to a dissident prince. The prince also claims that a clear majority of the country’s powerful Islamic clerics, known as the Ulama, would back a palace coup to oust the current King and install Prince Ahmed bin Abdulaziz, a former Interior Minister, in his place. “The Ulama and religious people prefer Prince Ahmed – not all of them, but 75 per cent,” said the prince, himself a grandson of King Ibn Saud, who founded the ruling dynasty in 1932. Support from the clerics would be vital for any change of monarch, since […]
As oil industry bleeds jobs, Asia’s green energy drive offers bright spot
A worker inspects solar panels at a solar farm in Dunhuang, 950km (590 miles) northwest of Lanzhou, Gansu Province in this September 16, 2013 file photo. Renewables are powering a rare bright spot in the energy industry, with record job hiring in solar, wind and hydro partly offsetting the biggest round of job losses in the oil and gas sector in almost two decades. The boom in new green jobs is being led by Asia where governments in countries such as China and India are embarking on massive programs to use more renewable energy. The fresh opportunities come as the oil sector is suffering its worst downturn since the late 1990s, encouraging engineering students to rethink their options and even mid-career switches for some who have spent more than a decade in the oil sector. "It’s a matter of time for me personally before I make the move," said […]
China’s Yantai Xinchao to buy U.S. oilfields for $1.3 billion
China’s Yantai Xinchao Industry Co Ltd has agreed to spend about 8.3 billion yuan ($1.31 billion) to buy oilfields in the U.S. state of Texas, the company said in a corporate filing late on Saturday. The oilfields, in Howard and Borden counties, will be bought from Tall City Exploration LLC and Plymouth Petroleum LLC, Xinchao said in the filing to the Shanghai Stock Exchange. The transaction has already been approved by the U.S. Treasury’s Committee on Foreign Investment, it added. (Reporting by Ben Blanchard and Meng Meng; Editing by Simon Cameron-Moore )
China Voice: Understanding China’s “around 7 percent” growth target
Workers are busy at a manufacture base of Dongbei Special Steel Group Co., Ltd. in Dalian, northeast China’s Liaoning Province, Oct. 13, 2015. (Xinhua/Liu Debin) BEIJING, Oct. 26 (Xinhua) — For those obsessing over China’s annual growth target of around 7 percent, the 6.9-percent expansion during the third quarter was a disappointment. The rate, the lowest quarterly expansion in 6 years, has led some China pessimists to jump to the conclusion that the government missed the annual growth target, which, on a few fronts, is a misunderstanding of the intent when setting such goals. First, China’s "around 7 percent" growth target is an anticipated goal, not an obligatory one. By allowing the market to play a bigger role in resource allocation for the world’s second largest economy, China’s growth has been under the combined influence of several domestic and external factors, making economic operations extremely intricate. Rather than a […]
U.S. Companies Warn of Slowing Economy
Quarterly profits and revenue at big American companies are poised to decline for the first time since the recession, as some industrial firms warn of a pullback in spending. From railroads to manufacturers to energy producers, businesses say they are facing a protracted slowdown in production, sales and employment that will spill into next year. Some of them say they are already experiencing a downturn. “The industrial environment’s in a recession. I don’t care what anybody says,” Daniel Florness, chief financial officer of Fastenal Co. FAST 1.33 % , told investors and analysts earlier this month. A third of the top 100 customers for Fastenal’s nuts, bolts and other factory and construction supplies have cut their spending by more than 10% and nearly a fifth by more than 25%, Mr. Florness said. The weakness is overshadowing pockets of growth in sectors such as aerospace and technology. Industrial companies are […]
Cash Crunch Clouds Future for Oil Firms
The world’s biggest oil companies are struggling to generate enough cash to cover their spending and dividends, despite efforts to slash billions of dollars from their budgets in the face of tumbling oil prices. Analysts say they expect the companies to reveal continuing shortfalls when they report earnings this week, after a third quarter in which oil prices fell to their lowest levels since the financial crisis. Brent crude, the global benchmark, averaged roughly $50 a barrel in the third quarter, compared with more than $60 a barrel in the second and around $100 in 2014. The cash crunch underscores the cloudy future facing Exxon, Chevron, Shell and BP amid a 16-month slump in oil prices. After a decade when high oil prices supported megaprojects and steadily escalating payouts to shareholders, the supermajors have slashed spending by more than $30 billion in recent months, laying off workers and delaying […]
Chinese Property Developer Snaps Up Texas Oil Fields
BEIJING—A little-known Chinese real-estate developer says it is scooping up oil assets in West Texas as part of a billion-dollar deal that underscores China’s keen interest in the U.S. energy patch. Shanghai-listed Yantai Xinchao Industry Co. said in a securities filing Saturday that it was acquiring oil properties in West Texas as part of a deal to buy an investment company called Ningbo Dingliang Huitong Equity Investment Center. Yantai Xinchao valued the overall deal at 8.3 billion yuan ($1.3 billion). The weekend filing said the oil properties were being acquired from two U.S. companies, Tall City Exploration LLC and Plymouth Petroleum LLC. The companies didn’t immediately respond to requests for comment on Sunday. Plymouth Petroleum is owned by Boston-based ArcLight Capital Partners LLC, a private-equity firm. Tall City is backed by another, Denham Capital Management LP. Bankers and other industry insiders say a host of Chinese firms—including some whose […]
Oil Falls as Dollar Surges Against Bearish Global Backdrop
Oil prices slipped Friday as the dollar surged after China introduced new stimulus measures to boost its flagging economy. The benchmark U.S. crude contract ended down 78 cents, or 1.7%, at $44.60 a barrel on the New York Mercantile Exchange, settling back below $45 for the first time since Oct. 1. Prices have now lost 10% from their peak earlier in the month. The global Brent benchmark finished down 9 cents, or 0.2%, at $47.99 a barrel on the ICE Futures Europe exchange. The selloff was prompted by a surge in the value of the U.S. dollar. The ICE Dollar Index has gained nearly 3% over the last seven sessions, its highest level since late August, against a basket of global currencies. Oil prices often move inversely to the dollar, as a strengthening currency makes it more expensive for investors to buy crude using foreign currencies. The dollar’s gains […]
OMV: Iran not quite ready for investors
Iran needs to create a competitive atmosphere to bring investors into the post-sanctions energy sector, Austrian energy company OMV says. File photo by Maryam Rahmanian/UPI VIENNA, Oct. 23 (UPI) — An investment opportunity exists in the Iranian energy sector, but there are a series of hurdles remaining, Austrian energy company OMV said. The Iranian government has approved a draft document outlining contracts for exploration, production and development of oil and natural gas fields in a post-sanctions business climate. Under the new terms, the National Iranian Oil Co. will set up joint ventures with foreign companies, which will be paid with a share of the output. Ahead of a string of planned investment conferences, Iranian officials have met with European energy representatives to discuss the terms of new relationships in the oil and gas sector. Austrian energy company OMV, whose chief executive officer Rainer Seele was among those who joined […]
Expect more oil from United Arab Emirates
United Arab Emirates could expand oil production using enhanced recovery techniques, U.S. Energy Information Administration reports. File photo by A.J. Sisco/UPI WASHINGTON, Oct. 23 (UPI) — OPEC-member United Arab Emirates could expand oil production by 30 percent by 2020 using a costly recovery technique, a U.S. federal review finds. The United Arab Emirates was the third-largest contributor to oil production from the Organization of Petroleum Exporting Countries last month. September oil production of 2.9 million barrels per day represented a 0.8 percent increase from the previous month. A brief report from the U.S. Energy Information Administration said Emirati production could increase by 30 percent by 2020 using a process called enhanced oil recovery. Primary recovery from oil deposits relates to natural pressure in the reservoir. Secondary recovery involves water or gas injection into the well to increase production. Enhanced oil recovery techniques include further stimulation from steam, gas or […]
China cuts rates again as growth engine stalls
China’s central bank cut interest rates on Friday for the sixth time in less than a year, and it again lowered the amount of cash that banks must hold as Continue Reading
China’s Central Bank Moves to Spur Economic Growth
BEIJING—Just days after reporting its worst economic performance since the global financial crisis, China has unveiled a one-two punch to prop up growth, while also sweeping away a major control on how banks set deposit rates. The country’s central bank combined a quarter-point cut in benchmark interest rates with a half-percentage reduction in banks’ reserve-requirement ratios, moves aimed at lowering corporate financing costs and pumping liquidity into the economy. Friday’s action was the sixth time since November that the Chinese central bank has cut interest rates and the fourth across-the-board reduction of the amount of deposits banks are required to hold in reserve. In a statement posted on the central bank’s website late on Friday, the People’s Bank of China attributed the measures to what it said was downward pressure on the world’s second-largest economy. China’s leaders are fighting a host of economic ills that have put their goal […]
Oil Bargain Hunting Remains Elusive Game
There’s a welcome whiff of oil industry consolidation in the air. But a gap between buyers and sellers shows there’s hardly a consensus that petroleum prices have hit bottom. Most of the recent action has been in Australia. Santos Ltd. SSLTY 2.92 % , one of Australia’s biggest energy companies, said Thursday that Scepter Partners, backed by Brunei’s oil-rich royalty, offered a 27% premium for the company over Wednesday’s price. This comes after Australian major Woodside Petroleum WOPEY -1.00 % bid for compatriot Oil Search, only to be rebuffed for being too cheap . Santos is also rebuffing Scepter, saying the bid is opportunistic. Scepter’s offer puts a debt-adjusted market value of $11.38 billion on Santos, or $9.14 per barrel of its proven and probable reserves. That is cheaper than Woodside’s offer for Oil Search at the time for $22.74 a barrel or Woodside’s own value of $17.38 a […]
China’s economic data is dodgy, but it doesn’t matter: Russell
Labourers work on top of a construction site in Jinning, Yunnan province, China, October 20, 2015. There is widespread scepticism about the accuracy of China’s economic growth numbers, but the real question shouldn’t be whether the data is credible, it should be whether it matters that it isn’t. The official gross domestic product (GDP) figure of 6.9 percent year-on-year growth for the September quarter was widely condemned by mainly Western economists as a fiction bearing little resemblance to actual economic activity. At the World Commodities Week conference in London this week, the consensus was that Chinese growth was more in the region of 5 to 6 percent, and that the official number owes more to political expediency than to economic reality. While this may indeed by true, the issue really should be whether absolutely accurate data is necessary when trying to get a handle on China. If you move […]
China end-September crude stocks up, while diesel sees record drawdown
China’s commercial crude oil stocks at the end of September rose 2.38 percent from August, while diesel stocks saw a record 15.68 percent drawdown amid the autumn harvest and fishing season,the official Xinhua News Agency reported on Friday. Refined fuel stocks overall dropped sharply for a second month in a row, falling 7.46 percent, China Oil, Gas & Petrochemicals (OGP), a Xinhua oil and gas newsletter, reported, reaching their lowest levels since January. The newsletter does not give volumes but the percentage drop in diesel was the largest since consistent data became available in 2010. Implied diesel demand, adjusted for changes in inventories, was up 1.6 percent on the year to 3.76 million barrels per day (bpd), Reuters calculations show. Gasoline stocks recorded a modest 2.47 percent increase, the newsletter said, after a significant drop in August during the summer driving season. Kerosene, used mostly as aviation fuel, rose […]
U.S. oil drillers slow pace of rig cuts: Baker Hughes
U.S. energy firms reduced oil rigs for an eighth week in a row this week but slowed the rate of those cuts to just one rig, data showed on Friday, a sign some drillers may soon return to the well pad with hopes of rising crude prices in the future. The total rig count for the week ended Oct. 23 fell to 594, the least since July 2010. Over the past eight weeks, drillers cut a total of 81 rigs, oil services company Baker Hughes Inc said in its closely followed report. The reduction this week was the lowest since drillers started cutting rigs at the start of September after adding 47 rigs over the summer. Drillers decided to add the rigs over the summer during the spring when crude prices averaged $60 a barrel in May and June. U.S. oil futures this week however have lost over 5 […]
U.S. Shale Drillers Running Out Of Options
Much has been made about the impressive gains in efficiency and productivity in the shale patch, as new drilling techniques squeeze ever more oil and gas out of new wells. But the limits to such an approach are becoming increasingly visible. The U.S. shale revolution is running out of steam. The collapse of oil prices has forced drillers to become more efficient, adding more wells per well pad, drilling longer laterals, adding more sand per frac job, etc. That allowed companies to continue to post gains in output despite using fewer and fewer rigs. However, the efficiency gains may have been illusory, or at best, incremental progress instead of revolutionary change. Rather than huge innovations in drilling performance, companies were likely just trimming down on staff, squeezing suppliers, and drilling in the best spots – perhaps all sensible stuff for companies dealing with shrinking revenues, but nothing to suggest […]
Whiplash: Shift in federal coal policies stokes fear in rural areas
Brenda Atkins, director of plant operations the Seminole Electric coal fire generation power plant, sits outside the plant in Palatka, Fla. (Garrett Hubbard/Courtesy of NRECA) PALATKA, Fla. — When the Arab embargoes of the 1970s threatened the country’s oil supply, the U.S. government issued an edict to the nation’s electricity producers: Start burning coal. So the local utility managers in rural Putnam County, Fla., did just that. The community-owned utility took out government loans and built its first power plant, using generators that made electricity from cheap Appalachian coal. Things were fine for more than three decades, until Washington delivered a new edict with precisely the opposite instructions: For the sake of the planet, stop burning coal . Now the little utility faces an uncertain future, and it is hardly alone. As the country’s electricity providers prepare to comply with new federal regulations that restrict the use of coal, […]
America’s Heartland Feels a Chill From Collapsing Commodity Prices
A thousand miles south of Granite City, Ill., a gritty steel town on the Mississippi River, West Texas oil rigs have shuddered to a halt. Seven hundred miles north, mines in the Iron Range of Minnesota have been stilled. The drilling rigs, with their deep underground pipes, once consumed much of the steel that Granite City’s blast furnaces could produce, while the mines supplied the raw material. So now, more than 2,000 workers at the mammoth United States Steel plant not far from St. Louis are waiting to see if they will be next. This month, the company warned them it might be forced to idle the plant. Layoffs could begin around Christmas. Granite City may be waiting, but a chill in economic activity is already evident across a broad swath of the nation’s heartland stretching from the Gulf of Mexico to the Canadian border, as prices of commodities […]
Truckers Again Becoming More Competitive With Rail
For years, railroads like Union Pacific have been developing their intermodal businesses of moving containers and trailers, allowing them to compete directly with truckers on their home turf. As fuel prices skyrocketed and trucking companies faced driver and capacity crunches, railroads became a logical, cheaper choice. But diesel prices have fallen by about 30% over the past year to $2.531 per gallon, according to the U.S. Energy Information Administration, something that has made trucking prices more competitive again. “I think you look at what’s going on currently in the trucking environment, the lower fuel cost is allowing trucks to be more competitive vis-à-vis rail, just by virtue of that fact,” said Eric Butler, Union Pacific’s executive vice president of marketing and sales, on an earnings call with analysts Thursday. While Union Pacific still expects to be able to grow its domestic intermodal business to record volumes for the seventh […]
U.S. Oil-Rig Count Drops for 8th Consecutive Week
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. After a streak of modest growth, the rig count has now declined for eight consecutive weeks. There are now about 63% fewer rigs from a peak of 1,609 last October. According to Baker Hughes, the number of gas rigs rose by one to 193. The U.S. offshore rig count was 35 in the latest week, up two from last week and down 20 from a year ago. For all rigs, including natural gas, the week’s total remained unchanged at 787. Meanwhile, production in the U.S. remains robust, above nine million barrels a day, despite a slowdown in output in recent months. Inventory data earlier this week showed domestic inventories rose by eight million barrels last week, the largest increase since the […]
Obama Carbon Rules to Face Lawsuits, Congressional Tests
WASHINGTON—What could be a yearslong legal and political battle over the Obama administration’s main climate-change initiative formally kicked off Friday, with two dozen states filing a lawsuit against regulations aimed at cutting U.S. carbon emissions. The states sued in a federal court here to challenge the rules, which seek to reduce carbon output from hundreds of power plants across the nation. Congressional Republicans also said Friday they would introduce measures in the coming week seeking to block the rules. The moves will put pressure on the administration from the two other branches of government and, if successful on either front, could cast uncertainty over the rules into the next presidential administration. The legal challengers are expected to contest the Environmental Protection Agency’s authority on a range of grounds, some of them little explored by the courts. Industry associations and companies, including coal producer Murray Energy, also began filing separate […]
TVA Cleared to Start First New U.S. Nuclear Power Plant in Nearly 20 Years
For the first time in almost 20 years, federal regulators have given a new nuclear power plant a license to begin generating electricity. The Nuclear Regulatory Commission gave the go-ahead Continue Reading
Alpha Natural to Sell Inactive Coal Mines
Alpha Natural Resources is selling a collection of closed coal mines as it revamps its business in bankruptcy. At least 16 idled mines in West Virginia, Kentucky, Tennessee and Illinois are being put up for sale in Alpha’s chapter 11 bankruptcy proceeding , which began in August. The company has set a Jan. 20, 2016, target date for bids and would like to seek a bankruptcy judge’s approval for sales by February, according to papers filed Thursday in the U.S. Bankruptcy Court in Richmond, Va. Alpha is one of a number of coal mining operations to take shelter in bankruptcy in a bid to weather widespread distress in the market . This week, the company said it expects to have a draft business plan ready by the end of October. Shedding unprofitable assets is part of that plan, the company said. Many of the mines have already been marketed. […]
Noble Cuts Dividend by 60%, Says Results Will Beat Forecasts
The Noble Discoverer in Everett, Wash., on May 12, 2015. Offshore driller Noble Corp. NE -0.46 % on Friday slashed its dividend by more than half, the latest company to make moves to preserve liquidity amid sharply lower oil and gas prices. The London-based company said it took down its quarterly payout to 15 cents a share from 37.5 cents. The cut is Noble’s first since mid-2012. “We believe the revised dividend appropriately addresses the prevailing industry uncertainty,” said Chief Executive David Williams. “The decision to adjust the dividend and preserve liquidity in an uncertain market is not reflective of our current financial performance,” Mr. Williams said, adding that the company expects to beat expectations when it reports third-quarter results next week. The reduction will cut Noble’s dividend yield to 4.6% from 11.5%, based on a $13.01 share price, which is where the stock was halted before the company […]
Keystone XL still viable, TransCanada says
TransCanada says Keystone XL still an effective and safe solution to bring economic stimulus to North America. Photo courtesy TransCanada CALGARY, Alberta, Oct. 23 (UPI) — The planned Keystone XL oil pipeline best fits the Liberal agenda for mobilizing Canadian resources in a way that benefits North America, TransCanada said. The planned Keystone XL would transport oil across the Canadian border to refineries along the southern U.S. coast. Supporters argue it would bring economic stimulus to North America, while detractors say a heavier form of Canadian crude oil called diluted bitumen could spoil the environment. Stephen Harper , whose Conservative Party was defeated in Monday’s national election , made the pipeline one of his top priorities during his administration. He’s argued the project is among the better alternatives, both economically and environmentally, to transport oil. An increase in North American oil production is more than the existing network of […]
Murkowski: Why no oil swaps with Mexico?
Sen. Lisa Murkowski, a supporter of repealing a U.S. oil export ban, asks Commerce Department if any oil swaps have taken place with Mexico. File photo by Kevin Dietsch/UPI WASHINGTON, Oct. 23 (UPI) — U.S. Sen. Lisa Murkowski , an advocate for repealing a 40-year-old ban on oil exports, said she wants to know why no oil is getting to Mexico under a swap deal. The U.S. Commerce Department in August granted a request from Mexican energy company Petroleos Mexicanos, known also as Pemex, to swap as much as 100,000 barrels of U.S. crude oil per day for refining. Legislation enacted in response to an oil embargo enforced in the 1970s by Arab members of the Organization of Petroleum Exporting Countries forbids the export of crude oil. The Commerce Department agreement requires Mexico to refine the crude oil at home and forbids re-export to other nations. Similar agreements are […]
Inflation Slows in Canada to 1% Amid Slack in Economy
Consumer price inflation in Canada slowed in September more than forecast, reflecting lower gasoline prices and an economy struggling with too much slack. The consumer price index was 1 percent above year-earlier levels, Statistics Canada said Friday from Ottawa. That’s down from 1.3 percent in the prior two months, and lower than the average of 1.1 percent this year. The Bank of Canada sees weak price gains as a sign the economy is running below capacity, and has been trying to drive inflation back up to its 2 percent target by keeping interest rates at historic lows. The central bank kept its key overnight rate at 0.5 percent this week after cutting it in January and July to cushion the damage from an oil-price shock. “Headline inflation remains very tame amid a generally soft economic backdrop and a steep drop in energy prices,” Benjamin Reitzes, senior economist at BMO […]
Oklahoma Earthquakes Are a National Security Threat
In the months after Sept. 11, 2001, as U.S. security officials assessed the top targets for potential terrorist attacks, the small town of Cushing, Okla., received special attention. Even though it is home to fewer than 10,000 people, Cushing is the largest commercial oil storage hub in North America, second only in size to the U.S. government’s Strategic Petroleum Reserve. The small town’s giant tanks, some big enough to fit a Boeing 747 jet inside, were filled with around 10 million barrels of crude at the time, an obvious target for someone looking to disrupt America’s economy and energy supply. The FBI, state and local law enforcement and emergency officials, and the energy companies that own the tanks formed a group called the Safety Alliance of Cushing. Soon, guards took up posts along the perimeter of storage facilities and newly installed cameras kept constant surveillance. References to the giant […]
Canadian Oil Companies Have Reasons to Love a Liberal Government
The Canadian energy industry’s second choice for prime minister is looking like the safest bet to revive its appeal to investors. While Liberal Justin Trudeau is supportive of environmental policies some energy producers may not like, his Monday victory puts into power a moderate government that stands between Conservatives who haven’t been able to advance key parts of the industry’s agenda and a more left-leaning party that’s seen as a strident foe. Trudeau is pledging to support new pipelines, help open markets for Canada’s oil and lure investment into the industry, while attempting to appease oil-sands opponents with more stringent curbs on pollution. His approach contrasts with the touting of projects by Stephen Harper, the outgoing leader whose repeated calls for approval of Keystone XL strained relations with U.S. President Barack Obama. “Trudeau has said nothing but positive things about Alberta’s energy industry,” said Stephen Carter, a Calgary-based non-partisan […]
Gazprom Said to See Its Lowest Europe Gas Price in 11 Years
Gazprom PJSC, the world’s biggest natural gas exporter, is planning for the lowest price for its fuel in its main European market for more than a decade. The state-run exporter is drafting its budget for 2016 with preliminary estimates for gas prices outside the former Soviet Union of about $200 per 1,000 cubic meters ($5.45 a million British thermal units), said two people with direct knowledge of the matter who asked not to be identified because the information is private. That compares with the company’s estimate of an average price for the region, which covers Turkey and Europe outside the Baltic States, in 2015 of about $238 per 1,000 cubic meters and $349 last year. The company’s press office declined to comment on estimates. Gazprom, which supplies about a third of Europe’s gas and relies on exports of the fuel for 40 percent of its annual revenue of more […]
Russian gas giant: Expansion of pipeline ensures reliability
Russian energy company Gazprom says expanding its Nord Stream pipeline network will help ensure Europe has a reliable source of energy. Photo courtesy of Gazprom PARIS, Oct. 23 (UPI) — Russian natural gas company Gazprom said expanding the Nord Stream pipeline to Europe adds another layer of security to the region’s energy sector. Russia meets about a quarter of European gas needs, though the bulk of that gas runs through a Soviet-era pipeline network in Ukraine. Conflict and ongoing debt issues between Gazprom and Kiev have created risks to the conventional artery, at times leaving downstream European consumers without gas needed for heat. Concealed Carry Mistakes: concealedcarryconfidence.org The Worst Thing a Permit Holder Can Do & More Concealed Carry Tips: Gazprom Chairman Alexei Miller met with French officials to discuss progress on expanding the Nord Stream gas pipeline, which runs through the Baltic Sea to Germany. Russia supplied France […]
Peak Oil Info-Graphic
Have we peaked? Interesting info graphic put together by Chiltern Thrust Bore LTD. 2 Comments on "Peak Oil Info-Graphic" GregT on Sat, 24th Oct 2015 2:57 am “Peak oil is a concept that was originally devised by M King Hubbert in the 1950s. The basic concept is that once oil production reaches it’s maximum output, a sharp decline will follow causing huge economic problems.” No need to worry folks, no huge economic problems in the foreseeable future. Everything is A OK. Now back to your regularly scheduled programming, and don’t forget that consumption is the key to prosperity.
NYMEX November gas settles 1.8 cents lower at $2.386/MMBtu on weather
The NYMEX November natural gas futures contract slipped 1.8 cents to settle at $2.386/MMBtu Thursday on a mild weather outlook. The settle marked the lowest close for a prompt-month contract Continue Reading
Oil Heads for Second Weekly Drop as Stockpiles Exacerbate Glut
Oil headed for a second weekly decline as expanding U.S. crude stockpiles exacerbated a global glut. Futures were little changed in New York and poised for a weekly decline of Continue Reading
Oil up on upbeat economic data, ECB stimulus moves
Oil prices rose on Friday, finding support from brighter economic data and a global stock market rally after the European Central Bank signaled more stimulus measures. Benchmark Brent crude oil Continue Reading
Oil Prices Rebound From Three-Week Lows
NEW YORK—Oil prices edged higher Thursday as traders weighed demand for refined products against a persistent oversupply of crude oil. Prices fell to near three-week lows Wednesday after U.S. inventory data showed that supplies grew more than expected. But demand for petroleum products also rose slightly in the week. Globally, low prices this year have pushed oil demand growth to the fastest rate in five years, according to the International Energy Agency. “This was a big build in crude oil inventories…but the market held,” said Wolfe Research in a note. “End-use demand remains strong.” Light, sweet crude for December delivery settled up 18 cents, or 0.4%, to $45.38 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, rose 23 cents, or 0.5%, to $48.08 a barrel on ICE Futures Europe. The U.S. Energy Information Administration reported Wednesday that domestic crude oil inventories expanded by eight million […]
Natural Gas Sinks to Three-Year Low
NEW YORK–Natural gas futures fell to fresh three-year lows Thursday as expectations of continued weak demand outweighed a smaller-than-expected inventory build. Futures for November delivery settled down 1.8 cents, or 0.7%, at $2.386 a million British thermal units on the New York Mercantile Exchange, the lowest settlement since June 13, 2012. Natural gas inventories typically rise at this time of year as producers stock up the heating fuel ahead of the winter, when consumption rises. The so-called injection season typically ends at the end of October, and consumers then draw natural gas out of storage to use for indoor heating through the end of March. This year, forecasts for warmer-than-normal weather in the coming weeks have traders concerned that stockpiles will continue to build longer than normal this year, pushing the already-oversupplied market into a deeper glut. The U.S. Energy Information Administration said Thursday that natural-gas inventories grew by […]
Oil’s Big Slump Looks Like the 1980s ‘Lost Decade’
Crude oil’s collapse is bringing back memories of the decade of low prices that started in 1985 when Saudi Arabia began targeting market share. Oil has dropped by almost half since last October when crude entered a bear market as the U.S. pumped near record rates and China’s economic growth slowed. Despite the longest decline in decades, some including Royal Dutch Shell Plc’s Chief Executive Officer Ben Van Beurden and Morgan Stanley Investment Management Inc.’s Head of Emerging Markets Ruchir Sharma think there’s more pain to come. The current downturn resembles that of 1985 and 1986, Bloomberg Intelligence analysts Peter Pulikkan and Michael Kay wrote in a report on Thursday. Just as price gains in the 1970s saw new technology open up fields in the North Sea and Alaska, Chinese-led demand in the first decade of this century helped unlock oil and gas from shale rocks in the U.S. […]
Iran to Boost South Pars Gas Output for Petrochemicals Expansion
Iran plans to start producing gas and condensate at Phases 17 and 18 of the South Pars offshore deposit by late March, boosting output of the fuel that it wants to use as feedstock to triple its petrochemicals output. The two new South Pars phases will produce a combined 50 million cubic meters a day of gas and 80,000 barrels a day of condensate, Hassan Jahangiri, implementation and project manager at Pars Oil & Gas Co., said Thursday in the southern port of Assaluyeh. They are scheduled for completion by the new Iranian calendar year starting March 21, he said. “The project is about 95 percent complete, and it will be ready to be inaugurated before the end of this Iranian year,” Jahangiri said of the two phases. “We are waiting for gas from the offshore fields.” Iran, with the world’s biggest natural gas reserves, according to BP Plc […]
For Saudis, Any Countermove Against Putin in Syria Carries Risks
Russian President Vladimir Putin, right, with his Syrian counterpart Bashar al-Assad in Moscow, on Oct. 20. Russia’s entry into the Syrian civil war has tilted the balance in favor of the government side, and there’s no risk-free way for Saudi Arabia — a key backer of the rebels — to tilt it back. Powerful Saudi clerics are calling for a response to the Russian move, even though the kingdom is already bogged down in another war in Yemen. Analysts say the Saudi government will probably speed up the flow of cash and weapons to its allies in the opposition fighting to topple President Bashar al-Assad, who’s also supported by Saudi Arabia’s main rival, Iran. While the Saudis may seek to direct their aid to “moderate forces” in Syria, “the definition of this word is subject to much debate,” said Theodore Karasik, a Dubai-based political analyst. Sending arms “is dangerous […]
CEO of Russia’s Rosneft Criticizes Saudi Oil-Market Strategy
Saudi Arabia’s move to maintain its share of the global oil market and expand in Europe will backfire, said the chief executive officer of Russia’s largest oil producer. “The strategy that Saudi Arabia has chosen doesn’t bring any significant victories,” Igor Sechin, CEO of OAO Rosneft, said Thursday at the Eurasian Forum in Verona, Italy. “More likely the opposite.” After the U.S. cut imports amid a boom in domestic production, exporters from the Middle East are increasing output and seeking new markets, a move that isn’t helpful for the global industry, Sechin said. After oil prices slumped amid a global surplus, Middle Eastern governments have to use “billions of dollars” from sovereign funds, raise large external loans or cut spending on new cars and furniture to make up the shortfall in revenues, he said. Saudi Arabia led the Organization of Petroleum Exporting Countries in a decision last year to […]