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U.S. shale oil output will be less resilient than gas: Kemp

U.S. natural gas production hit a new record in August, despite the deepening slump in gas prices and a fall in the number of rigs targeting gas formations. The failure of gas production to respond to lower prices and a falling rig count has left many analysts wondering if it heralds the same problem in the oil market – worsening oversupply. The number of rigs drilling for oil has plunged almost two-thirds over the last 12 months, but crude production is unchanged since October 2014 and down by less than 5 percent compared with its peak in April. Like shale gas producers, shale oil drillers have managed to raise output while cutting costs by concentrating on the best-known and most productive formations and areas. They have also standardized and accelerated the drilling process, drilled longer horizontal wells with more fracking stages, and employed more horsepower to fracture larger areas […]

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Bank of Russia Warns of Economic Risk From Saudi Oil Competition

Russia’s central bank warned that increased competition from Saudi Arabia in Europe, the destination for almost 70 percent of the nation’s oil exports, is creating new risks for its economy. As Saudi Arabia ships oil to new markets in the Europe, the price discount of Russia’s Urals crude blend to regional benchmark Brent is widening, Bank of Russia’s research and forecasting department said in a bulletin published on its website Thursday. The discount in Rotterdam has increased to $3.50 a barrel, up from its “usual” level of no more than $2, it said. “Oil supplies to Europe from Saudi Arabia are probably adversely affecting Urals prices,” the central bank’s researchers wrote. That creates additional risks for Russia’s exports, budget and balance of payments, according to the bulletin. Russia, which relies on energy for almost half of its government revenue, faces its first recession in six years amid a commodities […]

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CLIMATE COUNTDOWN: When’s a warming treaty not a treaty?

AP Photo/Jacques Brinon WASHINGTON (AP) — It’s the elephant in the negotiating room that few officials want to acknowledge: Whatever international deal comes out of Paris climate talks, it likely won’t be a treaty that needs ratification by a reluctant Republican U.S. Congress. That’s not the only complication in Paris. China, the U.S. and India don’t want the international community dictating their carbon dioxide emissions, but they do want to do something about ever escalating greenhouse gas levels and the rising temperatures they cause. So they have to come up with an agreement that doesn’t dictate binding, internationally set targets or require U.S. Senate approval – and yet gets the job done. At least partly. To do so, they must reach a pact that has as many twists and turns as a pretzel. "It’s a reality that the world is coming to grips with," former Vice President Al Gore […]

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Scientists say Greenland just opened up a major new ‘floodgate’ of ice into the ocean

Hills protruding from the fog near lower Zachariae Glacier. Credits: NASA/John Sonntag As the world prepares for the most important global climate summit yet in Paris later this month, news from Greenland could add urgency to the negotiations. For another major glacier appears to have begun a rapid retreat into a deep underwater basin, a troubling sign previously noticed at Greenland’s Jakobshavn Glacier and also in the Amundsen Sea region of West Antarctica. And in all of these cases, warm ocean waters reaching the deep bases of marine glaciers appears to be a major cause. The new fast-moving glacier is the Zachariae glacier or Zachariæ Isstrøm, located in the far northeastern part of Greenland. In a new paper in Science , Jeremie Mouginot of the University of California-Irvine and his colleagues find that the ocean-based glacier, which contains 0.5 meters or a foot and a half of potential sea […]

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Analysis: IEA World Energy Outlook sees Radical Shifts, Despite Conservatism

The next 25 years will see a radical shift towards renewables and away from coal, a global energy centre of gravity pivoting towards India and the prospect of Africa leapfrogging dirty energy. These are some of the insights touted by the International Energy Agency (IEA) World Energy Outlook 2015 , published this week. The annual outlook, weighing in at 700 pages, is one of the most widely-read and universally respected set of energy-related forecasts in the world. Yet it’s important to remember it remains just that: a forecast , reflecting a complex set of economic and energy-cost assumptions. Carbon Brief reviews some of the conservative assumptions that lie behind the outlook’s findings. China is slowing down One of the most dramatic shifts seen in this year’s outlook is the slowdown in China, in particular for coal. Now the world’s largest emitter, China is responsible for burning half of all […]

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It’s Already Happening: A Message to COP 21

STREE. REPORTAGE SUR LE SITE DE GAL CONDRUSES DANS LE CADRE DE LIEGE EN TRANSITION. Photo Michel Tonneau STREE. REPORTAGE SUR LE SITE DE GAL CONDRUSES DANS LE CADRE DE LIEGE EN TRANSITION. Photo Michel Tonneau With fewer than three weeks to go until the start of COP21, the UN’s climate negotiations in Paris, a question arises: Will this gathering make the slightest difference? For Rob Hopkins, editor of a new book from Transition Network, 21 Stories of Transition , answer is yes – but a different kind of yes than the global leaders meeting in Paris probably have in mind. He wants decision makers to reimagine their role as being ‘community enablers’ whose task is to deepen, connect and extend initiatives that are already out there. A huge upsurge in transformative local projects is evident around the world, argues Hopkins; the priority is not for global leaders to […]

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Is the Paris Climate Conference Designed to Fail?

The last time this much public attention was focused on the climate talks was in the lead-up to the Copenhagen conference in 2009. We should not forget how that turned out. (Image: via PabloSolon.com ) Ed. note: Portions of Brian’s latest book, Towards Climate Justice , were adapted for this article. From the end of this month through early December, much of the world’s attention will be focused on Paris, the site of the upcoming round of UN climate negotiations. This is the twenty-first time diplomats and heads of state will gather under the umbrella of the UN’s Framework Convention on Climate Change (UNFCCC), a document first put forward at the landmark 1992 “Earth Summit” in Rio de Janeiro – the same global conference where the elder George Bush told the world that the “American way of life is not negotiable.” The UNFCCC process has had its ups and […]

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Climate talks: High pressure in Paris

Newspaper + Premium online Newspaper + Premium online Premium Full FT.com subscription Premium Full FT.com subscription Standard Full news & archive Standard Full news & archive Trial Try Premium online Trial Try Premium online Price Monthly Annual $66.30 $11.77 per week $53.00 $9.25 per week $36.00 $6.45 per week $1.00 for 4 weeks $1.00 for 4 weeks FT Alphaville plus selected FT blogs yes yes yes yes Unlimited FT.com article access yes yes yes yes Unlimited mobile and tablet access yes yes yes yes Unlimited fast FT yes yes yes yes 5 year company financials archive yes yes yes yes The LEX column yes yes no yes ePaper access yes yes no yes Three exclusive weekly emails yes yes no yes Daily newspaper delivery yes no no For 4 weeks receive unlimited digital access to the FT’s trusted, award-winning business news FT Weekend delivery yes no no Select Select […]

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Kurt Cobb: Money Cannot Manufacture Resources

Our cornucopian economic and social narrative is in a state of denial and delusions. We have volumes of science that tell us what we are doing economically and socially is not sustainable. We cannot keep expanding our economy and population. We are trying to expand our economy and we are unable. Our population growth in uncontrollable even if we wanted to. What is even more of a catch 22 with our human arrangement is it is irreversible. We cannot degrowth without catastrophic collapse. We have far too many people that must be fed. Starvation and famine lead to failed states failed state in a complex global system like ours. This leads to generalized globalized failure. Just because it has not happened yet is no reason it won’t. If Saudi Arabia collapses so will the globalized world if its oil resources are destroyed. This is the inconvenient truth of complexity. […]

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Natural Gas Falls on Weak Demand Expectations

NEW YORK–Natural-gas prices slipped Wednesday on concerns about ample supplies. Moderate weather has kept demand for the heating fuel subdued, allowing storage inventories to grow above average levels. Weather-driven demand is usually strong enough at this time of year that stockpiles shrink each week as producers draw natural gas out of storage. But this year, analysts expect that producers are still injecting more fuel into storage than consumers are withdrawing. Forecasts released Wednesday showed warmer weather in the next two weeks than previously expected, with East Coast cities seeing temperatures above 60 degrees, according to Commodity Weather Group LLC. Natural-gas futures for December delivery settled down 5.7 cents, or 2.5%, at $2.263 per million British thermal units on the New York Mercantile Exchange. “A very mild November has led many in the market to think that the rest of winter might be warmer-than-normal, thereby leading to even lower prices,” […]

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Oil Prices Make Slippery Gains In Asia

HONG KONG–Oil prices are slightly higher in Asia trade because of a weaker dollar on Thursday, though the gains may not sustain as the near-term outlook remains challenging. Investors are awaiting data on U.S. oil stockpiles to be released later in the day by the Energy Information Administration, which may show an increase because of a seasonal slowdown and weaken prices. “Market watchers are expecting higher oil inventories,” said Barnabas Chen, energy analyst at OCBC Bank. There is also speculation that the Organization of the Petroleum Exporting Countries may raise a cap on production by around one million barrels when they meet on Dec. 4, he said, which may aid the bearish sentiment on crude oil caused by a supply overhang. On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $43.20 a barrel at 0418 GMT, up 27 cents in the Globex […]

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Oil gains on gasoline demand, technical buying

Pipes are pictured at the refinery of Austrian oil and gas group OMV in Schwechat, Austria, October 21, 2015. Oil prices rose slightly on Thursday to around $46 per barrel, supported by demand for gasoline and on technical buying after a sharp fall the previous day. Brent crude futures LCOc1 were at $45.90 by 0429 ET, up 9 cents following a 3.4 percent fall on Wednesday. Gasoline margins in Europe have tripled since mid-October as low prices boosted consumption. Demand is also strong in the United States, where gasoline importers on the East Coast are losing a trans-Atlantic tug-of-war over European supplies, outbid by Nigerian buyers anxious to avoid a holiday shortage. "There is strength across the gasoline complex, which is supportive, and there is technical support as we reached the bottom of a two-month range yesterday," said Olivier Jakob, oil analyst at Petromatrix in Zug, Switzerland. U.S. crude […]

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El Nino may stir grain markets more than Black Sea drought

El Nino could have a bigger impact on grain and oilseed markets than drought in Russia and Ukraine, which may be alleviated before the crucial spring growth period, analysts said on Wednesday. "You can’t have a drought problem overnight," David Hightower, president of research firm The Hightower Report, said of conditions in Russia and Ukraine. Speaking at the Global Grain conference in Geneva, he said El Nino, however, could have far-reaching effects if it lowers palm oil output in top producers Indonesia and Malaysia. A 10 percent drop in palm oil exports next year would require 4.7 million tonnes of alternative edible oils to be supplied for the world market, he said. "We don’t know what the impact of El Nino is going to be but China and India are much more significant (consumers) than in the previous El Nino cycle." Tightening supply in oilseed markets could spill over […]

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With Ramadi encircled, Iraqi forces brace for urban warfare

Iraqi forces appear better positioned than ever to launch an offensive against Islamic State militants controlling Ramadi, now that months-long efforts to cut off supply lines to the city are having an effect, but plenty of risks remain. The fall of Ramadi, the capital of Anbar province, to the group in May was the biggest defeat for Iraq’s weak central government in nearly a year, dampening its hopes of routing the Sunni militants from the country’s north and west. Retaking the city of 450,000 would provide a major psychological boost to Iraqi security forces, who have mostly collapsed in the face of advances by Islamic State, which last year seized a third of Iraq, a major OPEC oil producer and U.S ally. The ultimate goal for Iraqi forces is to break Islamic State’s grip over its main stronghold Mosul, the biggest city in the north. Critical momentum is needed […]

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Venezuela says ‘informal’ OPEC chat planned before December meeting

The logo of the Organization of the Petroleum Exporting Countries (OPEC) is pictured at its headquarters in Vienna, Austria, August 21, 2015. Oil ministers of OPEC nations will hold "candid, informal" talks on Dec. 3, a day before the group’s formally scheduled meeting in Vienna, Venezuela’s oil minister said on Wednesday, adding the idea was suggested by Saudi Arabia. "It’s an informal meeting where we’re going to speak in a very frank way about the market situation, and we’re going to speak frankly about production levels in each country," Venezuelan Oil Minister Eulogio del Pino told Reuters in a phone interview. Price-hawk Venezuela has been pushing for OPEC action to boost prices. OPEC kingpin Saudi Arabia, however, has rebuffed those calls and is instead focused on defending market share. The informal meeting will be held at the suggestion of Saudi Arabia’s oil minister Ali al-Naimi, del Pino said. "After […]

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Russia’s Oil Rivalry With Saudis Masks the Bigger Iranian Threat

Tougher competition in Europe, the destination for almost 70 percent of Russia’s oil exports, comes as the country is already battling recession. Competition is growing in Russia’s biggest oil market. While Saudi Arabia’s encroachment in Europe is getting all the attention , the biggest threat comes from another part of the Middle East — Iran. Saudi Arabia has started shipping crude to traditional Russian markets like Poland and Sweden, but supplies to Europe from the world’s largest exporter won’t increase by enough to reduce prices, said Texas-based consultant Stratfor. In contrast, a surge in Iranian exports after the lifting of sanctions could erode the value of Russian shipments to the region as soon as next year, according to KBC Advanced Technologies. Tougher competition in Europe, the destination for almost 70 percent of Russia’s oil exports, comes as the country is already battling recession. Oil and gas sales account for […]

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Iran’s Cabinet signs off on new oil contract terms

Cabinet ministers under Iranian President Hassan Rouhani sign off on terms of new oil contracts for a post-sanctions era. File Photo by Monika Graff/UPI TEHRAN, Nov. 11 (UPI) — Cabinet ministers in Iranian President Hassan Rouhani ‘s administration said they endorsed the terms of new oil contracts for a post-sanctions era. Mehdi Husseini, charged by the government with drafting a new contract model, told the Iranian Oil Ministry’s website SHANA the Cabinet has fully signed off on the new terms . Under the terms of the deal, the National Iranian Oil Company will establish joint ventures with its foreign counterparts, who will be paid with a share of any production. Previous terms gave energy companies a predetermined price for production volumes. Tehran hosts an international energy conference in late November to present the terms to potential investors. "A wide welcome is expected for the Tehran conference," Husseini said. Ali […]

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Leaked Emirati Emails Could Threaten Peace Talks in Libya

Photo Libyans demonstrated in Benghazi last month against a peace deal brokered by Bernardino Léon, a United Nations mediator. Credit Abdullah Doma/Agence France-Presse — Getty Images CAIRO — The United Arab Emirates was shipping weapons to favored belligerents in Libya over the summer in violation of an international arms embargo while simultaneously offering a highly paid job to the United Nations diplomat drafting a peace accord there, leaked Emirati emails show. The leaked correspondence is threatening to undermine months of Libyan talks by tarring the diplomat with an apparent conflict of interest. The emails also open a new window into the hidden and contradictory machinations of regional players like the United Arab Emirates that have helped inflame the fighting even as their diplomats say they support a peaceful solution. “The fact of the matter is that the U.A.E. violated the U.N. Security Council Resolution on Libya and continues to […]

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U.S. Arrests Two Relatives of Venezuelan President Nicolás Maduro on Drug-Trafficking Charges

U.S. agents have arrested two relatives of Venezuelan President Nicolás Maduro on charges they conspired to transport 800 kilograms of cocaine to the U.S., according to two people familiar with the matter. The arrests come amid U.S. accusations that the top echelon of the government in Caracas is involved in the narcotics trade . The two men, Efraín Antonio Campo Flores and Francisco Flores de Freitas, were first arrested in Port-au-Prince, Haiti, on Tuesday by local police, turned over to U.S. Drug Enforcement Administration agents and flown the same day to New York in a DEA jet, these people said. The two were scheduled to go before a federal judge in New York on Thursday, they said. A spokesman for the federal district court declined to comment. Mr. Campo Flores, 29 years old, identified himself on the DEA plane as a stepson of the president, according to the people […]

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China data: Crude stocks rise for 5th straight month in Oct amid limited storage

China’s crude stocks continued to grow for the fifth straight month in October, despite a month-on-month drop in net imports, output and slight rise in throughput, Platts calculations based on recently released official data showed. Crude stocks rose at a rate of 45,000 b/d in October, lower than the 784,000 b/d seen in September. China does not release official data on stocks. Platts calculates China’s net crude stock draw or build by subtracting refinery throughput from the country’s crude oil supply. The latter takes into account net crude oil imports and domestic crude production. Article continues below… Oilgram News brings you fast-breaking global petroleum and gas news on and including: Industry players, upstream and downstream markets, refineries, midstream transportation and financial reports Supply and demand trends, government actions, exploration and technology Daily futures summary Weekly API statistics, and much more Over the first ten months of this year, the […]

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OPEC Challenges Shale Afresh as Iraq Crude Floods Gulf of Mexico

(Bloomberg) — OPEC’s latest challenge to U.S. shale oil producers would be about two miles long, lined end to end, and weigh almost 3 million metric tons. It’s due to reach American ports this month. Iraq, the fastest-growing producer within the 12-nation group, loaded as many as 10 tankers in the past several weeks to deliver crude to U.S. ports in November, ship-tracking and charters compiled by Bloomberg show. Assuming they arrive as scheduled, the 19 million barrels being hauled would mark the biggest monthly influx from Iraq since June 2012, according to Energy Information Administration figures. The cargoes show how competition for sales among members of the Organization of Petroleum Exporting Countries is spilling out into global markets, intensifying competition with U.S. producers whose own output has retreated since summer. For tanker owners, it means rates for their ships are headed for the best quarter in seven years, […]

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China, Mideast Gas Use to Overtake Europe by 2035

China and the Middle East, spurred by lower prices and ample supply, will drive global natural gas demand growth in the next 25 years as consumption in Europe fails to recover to peak levels seen in 2010, according to the International Energy Agency. Both regions will become larger gas users than Europe by 2035, the Paris-based IEA said in its World Energy Outlook 2015. Global demand for gas, a cleaner-burning fuel for power generation than coal, will rise 1.4 percent a year to 5.16 trillion cubic meters (182 trillion cubic feet) in 2040, making it the fastest-growing fossil fuel. The agency forecast 1.6 percent annual growth to 5.38 trillion cubic meters in last year’s World Energy Outlook. “With gas prices already low in North America, and dragged lower elsewhere by ample supply and contractual linkages to oil prices, there is plenty of competitively priced gas seeking buyers in the […]

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Why are oil and gas companies calling for more action on climate change?

Smoke is released into the sky at a refinery in Wilmington, California March 24, 2012. This year many of us have increased our advocacy on this issue. And last month, companies responsible for a fifth of the world’s oil and gas supply in the Oil and Gas Climate Initiative (OGCI) threw their support behind a new global agreement at the forthcoming UN talks in Paris. For oil and gas companies to take such a stance has been described as "unusual" — and even "unprecedented". However, in fact, in BP we have publicly acknowledged the risk and have been working to address it since the 1990s. So why do companies that produce oil and gas want to see more done to tackle climate change? The first reason is simply that we want the planet to be sustainable in the future. We have the same hopes and fears for our children […]

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Major Oil Companies Have Half-Trillion Dollars to Fund Takeovers

An Exxon Mobil Corp. Gas Station Ahead Of Earnings Figures The world’s six largest publicly traded oil producers have more than a half-trillion dollars in stock and cash to snap up rival explorers. Exxon Mobil Corp. tops the list with a total of $320 billion for potential acquisitions. Chevron is next with $65 billion in cash and its own shares tucked away, followed by BP Plc with $53 billion, according to data from corporate filings compiled by Bloomberg. Merger speculation was running high after Anadarko Petroleum Corp. said Wednesday it withdrew an offer to buy Apache Corp. for an undisclosed amount. Apache rebuffed the unsolicited offer and wouldn’t provide access to internal financial data, Anadarko said. Both companies are now takeover targets, John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, said by phone. Royal Dutch Shell Plc has $32.4 billion available, almost all of […]

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EIA: Alberta oil will move by rail

U.S. study of post-Keystone XL energy landscape in Canada finds rail may carry more oil across the region. Photo by Steven Frame/Shutterstock WASHINGTON, Nov. 11 (UPI) — Crude oil deliveries from Alberta, Canada, will rely on rail in the wake of the permit refusal for Keystone XL , the U.S. Energy Information Administration said. The U.S. State Department last week denied TransCanada’s permit to build the cross-border Keystone XL oil pipeline. The project was designed to carry as much as 830,000 barrels of oil per day from Canada to Nebraska. From there, it would eventually send oil through the so-called Gulf Coast Project, which TransCanada put into service in 2014, and on to refineries along the southern U.S. coast Mark Cooper , a TransCanada spokesman, said saying no to Keystone XL means more of Canada’s crude oil would be sent to the U.S. market by rail, which the company […]

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Oil prices drop on rising stockpiles, slowing Asian economies

Towers at an oil refinery in the southern Sydney suburb of Kurnell are silhouetted against a cloudy sky August 6, 2004. Crude oil prices fell on Wednesday after industry data showed an increase in U.S. stockpiles, while China’s factory output slowed and fears emerged that Japan’s economy may have fallen into recession added to demand woes. Benchmark U.S. crude futures slipped to a two-week low at $43.55 a barrel in early trading before edging back up to $43.72 a barrel by 0652 GMT, still down almost half a dollar from their last close. Internationally traded Brent crude futures were down 29 cents at $47.15 a barrel. The price drops came on the back of rising stockpiles in North America and slowing economies in Asia. U.S. crude stocks jumped by 6.3 million barrels in the week to Nov. 6 to 486.1 million barrels, data from industry group the American Petroleum […]

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Oil Prices Edge Higher From Bottom-Pickers

Oil prices rose slightly higher with help from chart-based traders and bottom-pickers despite warnings from a top energy watchdog that the decision by the Organization of the Petroleum Exporting Countries to keep pumping could depress prices until the end of the decade. Many traders have been moving based on connections with the dollar and equities, and others are anticipating limited inventory growth this week, market participants said. Investors have recently shown a propensity to bet on the market rebalancing sooner than consensus expectations suggest, said Bill Herbert, analyst at Simmons & Co. International. “The rebalancing of the oil market is well under way,” he said. But “there is a lot that can push this off into 2017.” December crude oil settled up 34 cents, or 0.8%, to $44.21 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, gained 25 cents, or 0.5%, to $47.44 a barrel […]

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IEA sees oil below $80, what could go wrong?

An employee fills the tank of a car at a petrol station in Seoul June 27, 2011. Oil prices are unlikely to rise consistently above $80 per barrel before the end of the decade, the International Energy Agency (IEA) predicted in the World Energy Outlook published on Tuesday. Slower growth in demand coupled with the transformational impact of shale on production costs and increased supplies from Iran and Iraq will ensure the market rebalances slowly and at lower prices. The new edition of the World Energy Outlook (WEO 2015) analyses a range of supply and demand scenarios which see real oil prices rise gradually to between $55 and $83 by 2020. The problem is there is no evidence that the IEA or anyone else can accurately forecast oil prices five years in future. In the 2010 WEO, the agency predicted real prices would be around $90 in 2015, and […]

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Oil glut to swamp demand until 2020

Sign up for quick access to a wealth of global business news, including: Oil glut to swamp demand until 2020 Newspaper + Premium online Newspaper + Premium online Premium Full FT.com subscription Premium Full FT.com subscription Standard Full news & archive Standard Full news & archive Trial Try Premium online Trial Try Premium online Price Monthly Annual $66.30 $11.77 per week $53.00 $9.25 per week $36.00 $6.45 per week $1.00 for 4 weeks $1.00 for 4 weeks FT Alphaville plus selected FT blogs yes yes yes yes Unlimited FT.com article access yes yes yes yes Unlimited mobile and tablet access yes yes yes yes Unlimited fast FT yes yes yes yes 5 year company financials archive yes yes yes yes The LEX column yes yes no yes ePaper access yes yes no yes Three exclusive weekly emails yes yes no yes Daily newspaper delivery yes no no For 4 […]

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Short-Term Energy Outlook

Market Prices and Uncertainty Report This is a regular monthly supplement to the EIA Short-Term Energy Outlook . Contact: James Preciado ( [email protected] ) Full Report Crude Oil Prices: Crude oil prices remained within the range established over the previous three months. The North Sea Brent front month futures price settled at $47.98 per barrel (b) on November 5, an increase of 29 cents/b since October 1 ( Figure 1 ). The West Texas Intermediate (WTI) front month futures price settled at $45.20/b on November 5, rising by 46 cents/b over the same time. Figure 1: Historical crude oil front month futures prices Although prices were relatively stable, large uncertainty remains in the crude oil market, as upside and downside risks to supply and demand still exist. U.S. oil-directed rig counts continue to decline, but the effect on the overall U.S. production in the past few months is unclear. […]

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ADIPEC: Strain of low oil prices apparent even at plush Gulf meeting

On stage only a short time after the United Arab Emirates said it would increase its oil production despite low worldwide prices, the oil and gas minister of neighboring Oman didn’t pull any punches. Sultan Ahmed Al Jaber, the minister of state in the United Arab Emirates, smiles while listening to a speech in Abu Dhabi, United Arab Emirates, on Thursday, Oct. 29, 2015. Speaking from a Gulf nation whose skyscrapers rose on oil wealth, Britain’s Foreign Secretary Philip Hammond has called on the rest of the wealthy Arab world to put their money toward renewable and clean energy ahead of the landmark climate change conference in Paris later this year. (AP Photo/Jon Gambrell) ABU DHABI, United Arab Emirates (AP) — On stage only a short time after the United Arab Emirates said it would increase its oil production despite low worldwide prices, the oil and gas minister of […]

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OPEC Said to Consider New Output Ceiling as Indonesia Rejoins

The Organization of Petroleum Exporting Countries is considering raising its official production target at its next meeting on Dec. 4 to take into account new member Indonesia, according to two OPEC delegates. The production ceiling may be raised by 1 million barrels a day to 31 million barrels, the delegates said, asking not to be identified because the discussions are private. A change doesn’t imply higher production because OPEC itself said it pumped 31.57 million barrels a day in September. The Southeast Asian nation re-entry after a break of almost seven years comes at a time when OPEC has abandoned its traditional role in supporting prices as it seeks to defend market share against supplies from U.S. shale drillers and other rivals. OPEC will now have 13 members, led by Saudi Arabia, the world’s largest crude exporter. Indonesia’s suspended its membership in 2009 after becoming a net oil importer. […]

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OPEC’s Oil Output Strategy Seen Potentially Backfiring

OPEC’s unwillingness to limit its oil output could help usher in a sustained period of low prices and more pain for its members’ budgets, the International Energy Agency said Tuesday. The comments by the Paris-based monitor of energy trends echoed criticism from within and outside the group over a Saudi-led strategy of keeping the taps open to put pressure on higher-cost rivals such as the U.S. Members of the Organization of the Petroleum Exporting Countries including Venezuela, Iran and Algeria are being badly pinched by fallen oil prices and have agitated for production cutbacks to push them back up. Oil producers that aren’t members of the group are complaining as well: On Monday, Omani oil minister Mohammed Bin Hamad Al Rumhy called current oil production levels “irresponsible” and said the group had contributed to low oil prices. “This is a commodity that if you have 1 million barrels a […]

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OPEC Challenges Shale Afresh as Iraq Crude Floods U.S. Market

OPEC’s latest challenge to U.S. shale oil producers would be about two miles long, lined end to end, and weigh almost 3 million metric tons. It’s due to reach American ports this month. Iraq, the fastest-growing producer within the 12-nation group, loaded as many as 10 tankers in the past several weeks to deliver crude to U.S. ports in November, ship-tracking and charters compiled by Bloomberg show. Assuming they arrive as scheduled, the 19 million barrels being hauled would mark the biggest monthly influx from Iraq since June 2012, according to Energy Information Administration figures. The cargoes show how competition for sales among members of the Organization of Petroleum Exporting Countries is spilling out into global markets, intensifying competition with U.S. producers whose own output has retreated since summer. For tanker owners, it means rates for their ships are headed for the best quarter in seven years, fueled partly […]

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OPEC Is Likely to Change Course, IEA Says

OPEC is unlikely to sustain its practice of pumping flat out in a fight for global market share and will limit output in a scenario that sends oil prices to $80 a barrel by 2020, the International Energy Agency said Tuesday. Oil prices plunged last year when the Organization of the Petroleum Exporting Countries, and its de facto leader Saudi Arabia, abandoned its traditional role of propping up the market through supply cuts and began ramping up production instead. Prices haven’t recovered, sitting at about $47 a barrel Tuesday, down from $114 a barrel in June 2014. “Many OPEC producers will lose a substantial amount of revenue which will lead them to look at their policies again,” said Fatih Birol, the executive director of the IEA, a Paris-based group that monitors energy trends and data for industrialized nations. Mr. Birol’s comments were part of the release of the IEA’s […]

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Iran has stopped dismantling nuclear centrifuges: senior official

A Russian worker walks past the Bushehr nuclear power plant, 1,200 km (746 miles) south of Tehran October 26, 2010. Iran has stopped dismantling centrifuges in two uranium enrichment plants, state media reported on Tuesday, days after conservative lawmakers complained to President Hassan Rouhani that the process was too rushed. Last week, Iran announced it had begun shutting down inactive centrifuges at the Natanz and Fordow plants under the terms of a deal struck with world powers in July that limits its nuclear program in exchange for easing sanctions. Iran’s hardliners continue to resist and undermine the nuclear deal, which was forged by moderates they oppose and which they see as a capitulation to the West. "The (dismantling) process stopped with a warning," Ali Shamkhani, Secretary of the National Security Council, was quoted as saying by the ISNA student news agency. Only decommissioned centrifuges were being dismantled to begin […]

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Occidental plans Iraq exit

South Oil Company workers look toward the flares in the Zubair oil field on Jan. 21, 2010, the day before Eni, Occidental and Kogas signed the contract to develop the field. (ESSAM AL-SUDANI/AFP/Getty Images) Occidental Petroleum is planning to withdraw from the Zubair oil field project – the third international oil company to leave the country in the past three years.Multiple officials either involved in the Zubair project or familiar with the departure process have confirmed the exit is underway. Occidental’s exit appears to be part of a broader strategy, publicized by the company, to reduce its exposure to the region.The Oil Ministry has to formally sign off on the request and the 90-day p… This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free trial .

Posted On : Published By : Tom Whipple
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Oil majors press Iran for sweeter oil terms post-sanctions

Patrick Pouyanne, Chief Executive Officer of Total, attends the Oil and Gas Climate Initiative summit in Paris, France, October 16, 2015. Iran will have to offer lucrative contracts terms to draw back international oil companies at a time when the oil industry is more focused on profitability as it gears up for a longer period of low oil prices, executives said on Tuesday. Iran said in September it had approved a draft of international oil and gas contracts to attract foreign investors and oil buyers once international sanctions are lifted but has not provided details so far. The OPEC member will announce new oil and gas contracts at conferences in Tehran and London on Nov. 21-22 and Feb. 22-24 respectively. "It is not only questions of resources or opportunities, it is a question of profits," Total’s chief executive Patrick Pouyanne told a conference in Abu Dhabi, capital of the […]

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Iraq Oil Partners Seek Contract Changes to Boost Output

International oil companies could boost production in Iraq beyond current targets if production contracts were changed to give more incentives for investment, according to BP Plc and Royal Dutch Shell Plc. Companies working in the country have proposed that the government change contracts from the current service-fee model to be closer to production sharing agreements, Michael Townshend, BP’s regional president for the Middle East, told reporters in Abu Dhabi on Tuesday. The suggestions were made earlier this year amid talks about development budgets needed to operate Iraq’s oil fields next year, he said. Shell would need “a different commercial balance” to achieve full potential for its development of the Majnoon oil deposit, Maarten Wetselaar, the company’s executive vice president for integrated gas, told reporters in Abu Dhabi. “It’s a bit of an affront to its potential to only produce 225,000 barrels a day from it, you could double or […]

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Israel Invites Oil Majors for Further Natural Gas Exploration

JERUSALEM—Israel is inviting international oil companies to further explore its offshore waters for natural gas, the country’s energy minister said on Tuesday, as the country tries to become an energy exporter for first time. “We believe that based on the geological data—from our own experts and global companies—that there is still the potential for new discoveries,” Mr. Steinitz told reporters in Jerusalem. Israel, Egypt and other countries have pushed to turn the Mediterranean Sea into a natural-gas powerhouse as energy companies make new finds there. Shell’s head of gas Maarten Wetselaar declined to disclosed if the company had been in any talks with the Israeli government. “We are not in the gas business in Israel and have no immediate plans to explore or produce gas there,” Mr. Wetselaar said in an interview Tuesday. Representatives for Eni, Exxon and Hess didn’t respond immediately to requests for comment. Mr. Steinitz said […]

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Syria conflict: Army ‘breaks IS siege of Kuwairis airbase’

Image caption Syrian government forces launched an offensive in Aleppo province last month Government forces have broken a siege by Islamic State (IS) of an airbase in northern Syria, state media report. Army units had made contact with troops defending Kuwairis airbase, east of Aleppo, and eliminated large numbers of militants, the Sana news agency said. The facility had been under attack by the jihadists for nearly two years. Meanwhile, at least 22 people were killed and many more wounded by rebel shellfire in the Mediterranean city of Latakia, state media and activists say. The blasts hit two separate areas of the city, according to the Britain-based Syrian Observatory for Human Rights. With many of the wounded in serious condition, the death toll is expected to rise, the Observatory said. Latakia, which lies in the heartland of President Bashar al-Assad’s minority Alawite sect, has largely escaped the conflict that […]

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El Nino threatens ‘millions in east and southern Africa’

Some 11 million children are at risk from hunger, disease and water shortages in east and southern Africa because of the strengthening El Nino weather phenomenon, the UN children’s charity has said. It has caused the worst drought in more than 30 years in Ethiopia, Unicef said. Its effects could also be "particularly harsh" in Somalia, amid fears of flooding, it warned. El Nino is caused by Pacific Ocean warming. "The weather phenomenon, among the strongest on record, is likely to cause more floods and droughts, fuel Pacific typhoons and cyclones and affect more areas if it continues strengthening as forecast over the coming months," Unicef said in a statement . It said 8.2 million people in Ethiopia faced food insecurity, while an estimated 350,000 children needed treatment for severe acute malnutrition. "To make matters worse, the weather phenomenon may also bring flooding to some areas of the country […]

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Clashes Over Syrian Oil, Gas Assets Continue

Clashes over Syrian oil and gas assets continue as regime warplanes carry out raids on the country’s al-Izba oilfield, according to a statement from the Syrian Observatory for Human Rights. Clashes over Syrian oil and gas assets continue as regime warplanes carry out raids on the country’s al-Izba oilfield, located north of Deir Ezzor, according to a statement from the Syrian Observatory for Human Rights (SOHR), which monitors the conflict in Syria through a network of sources on the ground. The raids led to the outbreak of fire in the area, according to SOHR, which has recorded several violent encounters between the regime militia and Islamic State over the past year. Some of the most fought over fields in 2015 have been the Sha’er and Jazal assets , which both saw clashes at the end of September with casualties reported on both sides. SOHR reported further violent clashes around […]

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Syrian army breaks two-year siege at Aleppo airbase: state TV

A man walks out of a crater caused by what activists said was a barrel bomb dropped by forces loyal to Syria’s President Bashar Al-Assad in the town of Dael, north of Deraa, Syria November 8, 2015. Syrian soldiers fought their way into an airbase in northern Syria on Tuesday, state television said, breaking a nearly two-year siege by Islamic State insurgents at the facility and freeing military personnel holed up inside. A military source close to the government said the army was working to secure the Kweires airbase in Aleppo province, where soldiers and officers have been under attack since 2013. State television broadcast live footage from the airbase of an emotional, fatigue-clad reporter announcing the news, played victory songs and ran archive footage of military exercises. "We, the heroes of Kweires, are now celebrating with our brothers this victory," one of the freed soldiers told state TV, […]

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Saudi Arabia Preparing To Fuel Its $100 Billion Oil War With Debt

Saudi Arabia has probably spent around $100 billion of its foreign reserves by now to prosecute its war against American shale and other low-cost oil producers. The oil kingdom’s decision one year ago not to cut production to support oil prices has driven the price of both Brent crude and West Texas Intermediate down below $50 a barrel, but Saudi Arabia will have to spend a lot more to win the battle. Now, there are signs that Saudi Arabia is preparing to double down on its strategy with debt. The Financial Times reports that Saudi Arabia is getting ready to borrow funds in the international bond market to further finance its big effort to protect its market share in the oil world and make life impossible for U.S. shale. Saudi Arabia needs the money to keep its expensive social contract going in the face of rising budget deficits that […]

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Tullow Cuts Upper End of Forecast for West African Oil Output

Tullow Oil Plc cut the upper end of its 2015 forecast for West African oil production after operations in Ghana were affected by a gas-compression fault earlier this year. Output from the region will be 66,000 to 67,000 barrels of oil equivalent a day this year, the London-based company said Wednesday in a statement. That compares with guidance for as much as 70,000 barrels a day in July. Exports from Ghana’s Jubilee project, Tullow’s largest producing field, were halted on July 3 for about a month for repairs to the floating production vessel. The company, like other energy producers around the world, has also suffered from a 40 percent slump in crude prices over the past year amid a global supply glut. Its shares have tumbled more than 50 percent in the period. Another major development off Ghana, the Tweneboa-Enyenra-Ntomme — or TEN — project, is on schedule to […]

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Venezuela PDVSA negotiates light oil import deals for 2016

Venezuelan state oil company PDVSA will secure contracts to import crude by early next year, a senior executive said, phasing out spot-market purchases as part of a bold strategy to reduce costs and boost quality of its final blends. PDVSA [PDVSA.UL] is negotiating with some 15 companies and one option under discussion is paying suppliers with the final blend, Jesus Luongo, vice president of refining, trade & supply told Reuters in an interview. These supply contracts would also allow for flexible routing, with crude potentially sent to Venezuela’s oil fields, domestic refineries, or foreign ones depending on need. "We’ve already received proposals which we’re analyzing, and we’re waiting to be ready with our projects to make it happen," Luongo said in his Caracas office, adding work is underway to allow pipes and loading areas to route light oil to the vast extra-heavy crude Orinoco Belt. While coy on the […]

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