Category:

Russia tightens gas supplies to Poland

General view of the gas station near the border between Ukraine and Poland in the settlement of Drozdovychi, 120 km (75 miles) west of ukrainian city of Lviv. Moscow has reduced its gas exports to Poland in an apparent attempt to prevent EU countries from re-exporting Russian gas as a lifeline to Ukraine. Russia halted its direct gas shipments to Ukraine in June amid a pricing dispute that has accompanied their broader conflict over Crimea and eastern Ukraine. The latest move by state-controlled Gazprom to crack down on re-exports represents a further tightening of Moscow’s noose around Kiev before a winter that could cripple its economy if it cannot secure sufficient energy supplies. More On this topic IN Europe Poland’s state gas group PGNiG said on Wednesday that Gazprom had delivered 20 per cent less gas on Monday and 24 per cent less gas on Tuesday than it was […]

Posted On : Published By : Tom Whipple
Category:

Gazprom Limits Polish Gas Supplies as Reverse Flows Halt

Russia’s OAO Gazprom limited natural gas flows to Poland , preventing the European Union member state from supplying Ukraine via so-called reverse flows. Polskie Gornictwo Naftowe i Gazownictwo SA, or PGNiG, got 20 to 24 percent less fuel than it ordered from Gazprom Export over the past two days and is compensating flows with alternative supply, the company said today in an e-mailed statement . Poland halted gas supply to Ukraine at 3 p.m. Warsaw time today, according to Ukraine’s UkrTransGaz. Ukraine is seeking to replace some of its Russian gas with fuel from Europe after Gazprom halted its supplies on June 16 in a dispute over debt and prices, echoing spats in 2006 and 2009 that left European customers short of fuel. Gazprom Chief Executive Officer Alexey Miller said in June the company might limit supplies to gas-metering stations where it observed reverse flows. “It would appear from […]

Posted On : Published By : Tom Whipple
Category:

Iran’s Talks With Russia May Strike at Sanctions

Iran sent new signals on Tuesday that it was seeking to subvert the Western sanctions on its contentious nuclear energy program, adding uncertainties in advance of another round of negotiations next week in New York before the United Nations General Assembly. The Iranians said they had been engaged in talks with Russia, a member of the group of big powers negotiating with Tehran, about economic cooperation in energy, which could undercut the sanctions. South Africa, a former Iranian oil customer that has honored the sanctions in deference to Western pressure, said that, after talks with an Iranian delegation, it hoped to resume imports in three months. On Monday, Iran’s negotiator at the nuclear talks, Abbas Araghchi, the deputy foreign minister, said his country would not countenance any new economic penalties imposed by the United States, after an announcement by the Obama administration last month that it was adding more […]

Posted On : Published By : Tom Whipple
Category:

BofA Sees Deficit Risk on Oil as Auctions Vanish: Russia Credit

Oil falling below $100 a barrel for the first time in 15 months is a signal that Russia can’t stay out of the bond market indefinitely after the Finance Ministry canceled its eighth auction in a row. Crude dropped to $98.96 in London today, what would be the weakest level on a closing basis since April 17 last year and a 12 percent retreat in the third quarter. Ruble-denominated debt handed investors the biggest loss in the period in dollar terms among 31 emerging markets monitored by Bloomberg . With no auctions since mid-July, a steeper decline in Russia’s main export earner could flip the nation’s $19 billion budget surplus into a deficit by year-end, according to Bank of America Corp. U.S. and European Union sanctions over Ukraine drove 10-year ruble borrowing costs 120 basis points higher since June. That compares with a 66 basis-point drop in Brazilian yields. […]

Posted On : Published By : Tom Whipple
Category:

Kremlin comes to rescue of Rosneft

| License Photo The Kremlin has a vested interest in ensuring sanctions-strapped oil company Rosneft can maintain operations, the Russian prime minister said Monday. Western governments have enacted sanctions on Russia’s energy and defense sectors in response to crises simmering on the Ukrainian border with Russia. When Russian oil company Rosneft was targeted, Chief Executive Officer Igor Sechin , himself sanctioned, he said the company’s strategy was affected. Russian Prime Minister Dmitry Medvedev told Russian business daily Vedemosti it was incumbent upon the government to prop up Rosneft with more than $40 billion from a national welfare fund. "The company needs to keep up production, since Rosneft is a major contributor to the budget," he said. "In this regard, we have to help them by maintaining the investment level." Sechin in July said the government-controlled oil company was operating under difficult conditions because of the sanctions, but added he […]

Posted On : Published By : Tom Whipple
Category:

Russia Sees Oil Output Edging Down In 2015

Hess To Form MLP For North Dakota Oil, Gas Transport Assets MOSCOW, Sept 8 (Reuters) – Russian oil production, a major source of government revenue, may decline slightly next year, having risen steadily since 2009, the Energy Ministry said on Monday. The ministry said oil production in 2015 was seen at 525 million tonnes (10.54 million barrels per day) compared to an expected 525.3 million tonnes this year. Last year’s oil output, which generates 40 percent of state revenues, stood at 523.3 million tonnes, a post-Soviet high. Output declined by 0.6 percent in 2008 because of a global financial crisis, but has risen steadily since 2009 thanks to the introduction of a more favourable tax regime and other fiscal measures. With Russia’s $2 trillion economy heavily dependent on crude exports and on the brink of recession, oil production and prices are closely monitored by the Kremlin. The government is […]

Posted On : Published By : Tom Whipple
Category:

New EU Sanctions to Stop Fundraising by 3 Russian Oil Giants

A Rosneft logo at the company’s headquarters in Moscow. New sanctions from the European Union will expand the number of companies unable to raise money in the bloc’s capital markets. Bloomberg News BRUSSELS—New European Union sanctions on Russia will expand the number of Russian companies unable to raise money in the bloc’s capital markets to include three major state-owned oil companies, according to documents seen by The Wall Street Journal. Under a modest expansion of sanctions introduced in late July, the three oil companies— Gazpromneft , the oil-production and refining subsidiary of OAO Gazprom , oil transportation company Transneft , and oil giant Rosneft—will be forbidden from raising funds of longer than 30 days’ maturity. Five state-controlled banks, including Sberbank and VTB Bank , already barred from raising funds for longer than 90 days under the July sanctions, will also have the maximum maturity cut to 30 days. The […]

Posted On : Published By : Tom Whipple
Category:

Build starts on Russia-China gas pipeline

Russian President Vladimir Putin was on hand for the launch ceremony for construction of the Power of Siberia natural gas pipeline. A contract between Russian natural gas company Gazprom and China National Petroleum Corp. is for 30 years and calls for 1.3 trillion cubic feet of natural gas per year . "The new trunk gas pipeline will help considerably strengthen economic cooperation with Asia-Pacific countries, first of all, with our key partner China," he said. Gazprom officials have expressed interest in moving deeper into a growing Asian economy in an effort to offset a stagnant European Union. Europe, for its part, has sought to break the Russian grip on the regional energy sector by securing new sources of natural gas, notably from Azerbaijan. Putin said the new 2,500-mile gas pipeline to China will tie the Russian energy sector to both poles of the economic world . "This [pipeline] will […]

Posted On : Published By : Tom Whipple
Category:

EU Fails to Broker Russia, Ukraine Gas Truce

MOSCOW—The European Union has failed to broker a truce to resolve the long-running natural gas dispute between Russia and Ukraine at high-profile talks Friday, though the Kremlin said gas supply to Europe should be safe this winter. EU energy chief Günther Oettinger traveled to Moscow to discuss a possible interim deal with Russian Energy Minister Alexander Novak ahead of three-way talks, which it is hoped will take place next week. The talks coincide with a sharp escalation in the conflict between Russia and Ukraine. On Thursday, Ukraine accused Russia of invading the country , saying Russian troops seized the coastal town of Novoazovsk and other villages along the border. At Friday’s gas talks, Russia repeated its previous offer to sell gas to Ukraine at a discount of $100 per 1,000 cubic meters of gas, Mr. Novak said after meeting Mr. Oettinger. The offer puts the price of a 1,000 […]

Posted On : Published By : Tom Whipple
Category:

Russia to take rubles, yuan for oil

For exports from the Novoportovskoye field in the arctic, the company said it would accept the Russian currency, while China could use its own currency for oil delivered from the Eastern Siberia-Pacific Ocean pipeline. The switch could help the Russian economy reduce its dependency on the U.S. dollar in an era when Western economies are imposing tough sanctions on Moscow in response to the ongoing crisis in Ukraine. Gazprom Neft said it made $2.4 billion in net profits and increased production 4.1 percent during the first half of the year. The U.S. Energy Information Administration, the statistical arm of the Energy Department, said in a July brief that exports of crude oil, petroleum products and natural gas accounted for 68 percent of all export revenues for Russia in 2013. The first branch of the ESPO pipeline entered service in January 2010. Gazprom Neft started work in the arctic field […]

Posted On : Published By : Tom Whipple