Category:

Tony Hayward: Sanctions against Russia could spur $150 oil

Tony Hayward: Sanctions against Russia could spur $150 oil Western sanctions against Russia, coupled with ongoing political instability in Libya and the advance of ISIS militants in Iraq, could leave the global oil supply exposed and push up oil prices to $150 per barrel, former BP chief Tony Hayward has warned. The former CEO of BP and now chairman of Glencore Xstrata said the recent boom in US shale production has painted an unrealistic image of the world’s global oil supply, and created a false sense in energy security. “The world has been lulled into a false sense of security because of what’s going on in the US,” Hayward said in an interview with the Financial Times . The hydraulic fracturing boom in the US began in 2008 and has increased US crude output by 60 percent, but Hayward warned it could wane. “When US supply peaks, where will […]

Posted On : Published By : Tom Whipple
Category:

Russian PM Medvedev says Western sanctions are testing country’s strength

MOSCOW (Reuters) – Russia’s strength is being tested by sanctions imposed by the West and the country must react in a level-headed way, Prime Minister Dmitry Medvedev told members of the country’s ruling party, United Russia, on Monday. "When a series of our partners, if they can be called that, test Russia’s strength through sanctions and all kinds of threats, it is important not to succumb to the temptation of so-called easy solutions and to preserve and continue the development of democratic processes in our society, our state," Medvedev said in a televised speech. The European Union and the United States imposed late last week a fresh set of sanctions against Moscow for its policy on Ukraine, further limiting access for some of Russia’s key companies to foreign capital markets. (Reporting by Lidia Kelly; Editing by Alessandra Prentice)

Posted On : Published By : Tom Whipple
Category:

Former BP chief warns on Russia sanctions

Tony Hayward, photographed during an interview with the FT at Finsbury this morning. US and EU sanctions against Moscow are in danger of turning round and biting the west by constraining global oil supply and pushing up prices in coming years, the former chief executive of BP has warned. Tony Hayward said that cutting off capital markets from Russia’s energy groups, which would eventually lead to less investment in Russian oil production, was likely to damage long-term supply. He said the US shale boom had obscured the growing risks to the world’s supply picture, but its effect would wear off, leaving the global economy dangerously exposed to potential disruptions in the flow of oil. His comments came as the US and Europe expanded sanctions against Russia on Friday with the US adding Gazprom , Europe’s leading energy provider, and Lukoil , the privately owned oil group, to the list […]

Posted On : Published By : Tom Whipple
Category:

Nuclear energy tops Russia, Iran agenda

| License Photo MOSCOW, Sept. 12 (UPI) — Though oil and gas are on the agenda, an aide to the Kremlin said work on nuclear energy was one of the more important issues during talks Friday with Iran. Iranian President Hassan Rouhani met Friday with Russian President Vladimir Putin on the sidelines of a regional multilateral meeting of the Shanghai Cooperation Organization in Tajikistan. Yuri Ushakov, an adviser to the Russian president, said both sides would discuss Russian supplies of oil, gas and energy equipment to Iran. The two leaders, however, would focus on "the most important aspects of cooperation in the peaceful use of nuclear energy," he said Friday. Russia supplies nuclear fuel to Iran’s nuclear reactor in Bushehr. Both sides have mulled an oil-for-goods deal that would give Iran an opportunity to circumvent international sanctions on its energy sector. The U.S. government said it would act should […]

Posted On : Published By : Tom Whipple
Category:

U.S. and European Sanctions Take Aim at Putin’s Economic Efforts

WASHINGTON — The United States and the European Union moved on Friday to shut down Western aid to Russian deepwater, Arctic offshore and shale oil exploration, broadening and deepening the range of sanctions imposed on Moscow in retaliation for its intervention in Ukraine despite the potential cost to Western firms like Exxon Mobil and BP. With twin announcements in Washington and Brussels, the new measures targeting Russia’s energy development came in addition to further limits on access to American and European capital markets, making it harder for Russian banks to obtain any credit in foreign capitals beyond short-term loans. The United States specifically targeted Russia’s largest bank, Sberbank, for the first time. The Europeans also banned travel by and froze the assets of 24 more individuals, including Russian lawmakers and others who have supported President Vladimir V. Putin over Ukraine, while the Americans blocked the assets of five Russian […]

Posted On : Published By : Tom Whipple
Category:

U.S. Expands Sanctions to Giant Russian Energy Projects

By William Mauldin and Daniel Gilbert The U.S. joined the European Union in expanding sanctions to target Russian Arctic and shale-oil projects and further limit financing to Russian state-controlled companies, a move to put pressure on Moscow as Ukraine negotiates a long-term peace plan and closer ties to the E.U. The energy sanctions announced Friday, widely expected in recent days, will prevent Western energy firms from providing technology and services — other than financial services — to five Russian energy majors’ oil projects in the Arctic, deep offshore fields and shale, the U.S. Treasury Department said. The energy sanctions could directly impact partnerships such as Exxon Mobil Corp.’s (XOM) pact with OAO Rosneft (ROSN.MZ), one of the five firms targeted, according to U.S. officials and legal experts. The two companies have been drilling in the Arctic Kara Sea, as well as exploring for oil in a Siberian shale-rock formation. […]

Posted On : Published By : Tom Whipple
Category:

U.S., EU Widen Sanctions on Russia

A logo stands on display on the front of an OAO Rosneft gas station in Moscow. The U.S. and European Union announced new sanctions Friday that target Russian Arctic and shale-oil projects, which could affect a partnership between Rosneft and Exxon Mobil. Bloomberg News The U.S. joined the European Union in expanding sanctions to target Russian Arctic and shale-oil projects and further limit financing to Russian state-controlled companies, a move to put pressure on Moscow as Ukraine negotiates a long-term peace plan and closer ties to the EU. The energy sanctions announced Friday, widely expected in recent days , will prevent Western energy firms from providing technology and services—other than financial services—to five Russian energy majors’ oil projects in the Arctic, deep offshore fields and shale, the U.S. Treasury Department said. U.S. companies have two weeks to comply with the sanctions, likely meaning an end for now to Exxon […]

Posted On : Published By : Tom Whipple
Category:

Sanctions Over Ukraine Put Exxon at Risk

When Exxon Mobil Corp. Chief Executive Rex Tillerson detailed a deal to drill for oil in Russia’s Arctic Sea two years ago, he predicted that the project would strengthen the ties between the U.S. and Russia. Instead, Exxon has wound up in the cross hairs of U.S. foreign policy, which could threaten one of the company’s best chances to find and tap significant—and much needed—amounts of crude oil. The U.S. on Thursday announced new sanctions targeting Russia’s financial, defense and energy sectors in a bid to punish the Kremlin for stoking the military conflict in Ukraine. Details of the sanctions, designed to match new measures imposed by the European Union , are set to be released Friday. A U.S. official said the new penalties would affect Exxon’s current drilling in the icy Kara Sea with its Kremlin-controlled partner, OAO Rosneft , though the extent of the impact was unclear […]

Posted On : Published By : Tom Whipple
Category:

Gazprom Said to Face Biggest Drop in EU Revenue in 5 Years

OAO Gazprom (GAZP) , the world’s largest natural gas exporter, may face the biggest decline in European gas revenue in five years as demand weakens and buyers negotiate discounts, according to two company officials. Sales to the European Union, the source of 40 percent of revenue by Russian accounting standards, are forecast to fall more than 10 percent to about $55 billion this year, said the officials, asking not to be identified as the forecast isn’t public yet. Gazprom’s press service declined to comment. The forecast doesn’t take into account the rift between the EU and Russia over its involvement in the crisis in Ukraine , the main transit route for gas to Europe . While flows so far remain unaffected, the EU is seeking to ease reliance on Russian gas. Demand is falling after the region pumped a record volume of the fuel into underground storage to guard […]

Posted On : Published By : Tom Whipple
Category:

Gazprom First-Quarter Profit Falls 41% on Ukrainian Gas Debt

OAO Gazprom, Russia ’s biggest company, said its first-quarter profit slumped 41 percent on a foreign currency loss and Ukraine’s debt for natural gas supplies. Net income dropped to 223 billion rubles ($6 billion) from 381 billion rubles a year earlier, the Moscow-based exporter said in a statement on its website. Gazprom, which provides 30 percent of the European Union’s gas, halted supplies to Ukraine in June over unpaid bills, including $1.45 billion from 2013. The Russian producer now estimates it’s owed $5.3 billion after raising the price for Ukraine in April to a level higher than it charges Germany , which the government in Kiev has rejected as unfair. The quarter marks the “start of not an easy year,” Gazprombank energy analysts wrote in an e-mailed note before the report. While a weaker ruble is compensating for a decrease in Gazprom’s export prices, the biggest negative factor is […]

Posted On : Published By : Tom Whipple