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Brazil’s Petrobras Reports Nearly $17 Billion in Asset and Corruption Charges

ENLARGE Petrobras’s disclosures Wednesday were part of the first audited financial statements released by the oil company in more than eight months. Photo: VANDERLEI ALMEIDA/AGENCE FRANCE-PRESSE/GETTY IMAGES RIO DE JANEIRO—Brazil’s state oil company Petróleo Brasileiro SA put a price tag on a corruption scandal that has thrown the country into political and economic turmoil, writing off $17 billion due to losses from graft and overvalued assets. The disclosures were part of the first audited financial statements released by Petrobras in more than eight months. Brazilian federal prosecutors since last year have been investigating allegations that the company’s suppliers conspired to overcharge Petrobras for major projects, funneling some of the illicit profit to former Petrobras executives and politicians in the form of bribes and illegal political donations. Petrobras Chief Executive Aldemir Bendine said in a news conference that additional revisions to the corruption-related write-downs are possible if prosecutors uncover more […]

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OPEC should consider return to oil quotas: delegate

LONDON (Reuters) – OPEC should consider re-introducing individual output quotas, shuffled quietly to one side in 2008, to prevent oversupply hitting prices should Iran increase its oil exports following a deal over its nuclear work, an OPEC delegate said. A proposal to reintroduce quotas would spark a fierce debate in the Organization of the Petroleum Exporting Countries as national prestige and market share are at stake. After refusing to cut output last year, OPEC is pumping much more than its overall output target of 30 million barrels per day (bpd) because of record Saudi Arabian output, higher Iraqi exports and a partial return of Libyan crude. "Iraq is increasing each month and if that is so and if Iran is back, then either the price has to go down or there has to be some sort of arrangements," said a senior OPEC delegate from a non-Gulf OPEC member who […]

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OPEC Joins Downbeat Forecasts for U.S. Oil Output

Oil-pumping units in western North Dakota in January. ENLARGE Photo: Associated Press The boom in U.S. oil supplies will end in 2015, the Organization of the Petroleum Exporting Countries said Thursday, joining other major energy forecasters this week in pointing to an imminent fall in American production. In its closely watched monthly market report, OPEC said U.S. oil supplies would grow to about 13.65 million barrels a day in the second quarter of 2015 and then level off, beginning to decline in the second half of the year. The number includes crude oil and other petroleum liquids such as condensates. OPEC’s report comes after the U.S. Energy Information Administration forecast this week that total crude-oil production from seven key U.S. production regions would decline by 57,000 barrels a day in May from April. The International Energy Agency, which tracks oil data for Western countries, said Wednesday that American output […]

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OPEC increases oil production in March; U.S. shale dropping

The majority of oil demand growth is coming from Asia and the Middle East. Photo by Christian Lagerek/Shutterstock VIENNA, April 16 (UPI) — The Organization of Petroleum Exporting Countries will continue increasing output of oil, despite an oversupply, projecting an increased demand 80,000 barrels per day higher for this year than anticipated. For the month of March, OPEC produced an average of about 30.79 million barrels per day — an increase of 810,000 thousand bpd. "Crude oil output increased mostly from Saudi Arabia and Iraq, while Libya saw a return of about 165 [thousand barrels per day] from shut-in wells in active oil fields," OPEC states in its monthly oil market report . Non-OPEC oil supply is expected to grow by 680,000 barrels per day, up from the previous month. The organization projects U.S. shale oil and Canadian oil sands output is expected to see lower growth due to […]

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OPEC oil output surge boosts surplus, despite higher demand

LONDON (Reuters) – OPEC said its oil output surged in March, adding to a global glut, despite more evidence that the producer group’s strategy of letting prices fall to hurt other producers is taking effect. OPEC’s report may reinforce the perception that major producers are staking out market share ahead of a potential rise in Iranian exports following its framework accord with world powers over its nuclear program. Thanks to lower output from the United States and other rival producers due to the oil price drop, the Organization of the Petroleum Exporting Countries said demand for its oil this year would be 80,000 barrels per day (bpd) higher than previously thought. Its monthly oil market report also confirmed industry estimates of a surge in OPEC production in March, which jumped by 810,000 bpd – ten times the increase in 2015 demand for OPEC crude – led by record output […]

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Russia in Active Consultations with OPEC

ENLARGE Arkady Dvorkovich, Russia’s deputy prime minister, at the World Economic Forum in Davos this year. He said on Wednesday that the Russian Energy Ministry was continuing to conduct active consultations with the European Union, Asia-Pacific countries, the Middle Eas and with countries of Latin America. Photo: Bloomberg News MOSCOW—Russia is conducting “unprecedentedly active” consultations with the Organization of the Petroleum Exporting Countries but isn’t discussing oil production cuts to support prices, Russian officials said on Wednesday. The consultations come after several months of low oil prices that are putting pressure on Russia’s budget and currency , but Russian officials poured cold water on any suggestion of coordinated production cuts. “The Energy Ministry is continuing to conduct active consultations and work with the European Union, countries of the Asia-Pacific region, the Middle East, including within the framework of OPEC, as well as with the countries of Latin America,” Deputy […]

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OPEC’s no-cut strategy is not working, Iran says

BEIJING (Reuters) – OPEC’s strategy of holding output steady is not working and the group’s members should discuss production levels before its next meeting in June, Iran’s oil minister said, a sign of the pain lower prices are causing OPEC’s less wealthy producers. However, Bijan Zanganeh also told Reuters it was up to other members of the Organization of the Petroleum Exporting Countries (OPEC) to make way for any extra Iranian crude that reaches world markets if Western sanctions on Tehran are lifted. Oil prices have halved from the $115-a-barrel level hit last June, in a drop that deepened after OPEC refused to cut output, choosing instead to defend market share. Top exporter Saudi Arabia was the driving force behind the policy shift. "It seems (OPEC’s strategy of not cutting output) does not work well, because prices are coming down," Zanganeh told Reuters on Thursday during a visit to […]

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EIA: OPEC’s net oil export revenues declined 11% in 2014

Members of the Organization of Petroleum Exporting Countries, excluding Iran, earned $730 billion in net oil export revenues during 2014, according to estimates from the US Energy Information Administration . The total—the lowest earnings for the group since 2010—is an 11% decline from $824 billion in 2013, primarily due to the decline in average annual crude oil prices , and to a lesser extent from decreases in the amount of OPEC net oil exports, EIA says. Saudi Arabia earned the largest share of the earnings—$246 billion in 2014—representing one third of total OPEC oil revenues. Iran’s revenues are excluded from the total because of difficulties associated with estimating that country’s earnings, including its inability to receive payments and possible price discounts offered to existing customers. OPEC net oil export revenues, excluding Iran, could fall further to $380 billion in 2015 as a result of the much lower annual oil […]

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Saudis claw back global market share with oil output push

LONDON (Reuters) – When Saudi Arabia’s oil minister Ali al-Naimi says he does not want the kingdom to lose market share anymore, he really means it. Iraq, Venezuela, Russia and Kazakhstan all saw their oil partially replaced by Saudi crude in Asia, the United States and even Europe, with its lackluster demand, as traders said the kingdom offered customers more oil, and more cheaply. Supplies from OPEC’s leading producer are notoriously difficult to track as they reach customers under confidential direct deals rather than via the spot market. But an indirect confirmation of rising deliveries came on Sunday from Naimi himself. The veteran minister, who carefully chooses his words and figures in his speeches, said the kingdom was now pumping around 10 million barrels per day – near an all-time high and some 350,000 bpd above the figure Saudi Arabia gave to OPEC for its February output. And to […]

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OPEC’s Gulf core steels for longer wait, lower prices in shale struggle

DUBAI (Reuters) – U.S. shale drilling may be slowing, but not fast enough for OPEC to change policy at its June meeting or to prevent oil prices maybe falling more, in the view of the group’s Gulf members. Actual oil output from the United States could prove harder to beat back, sources in the Gulf say after poring over the latest data with top consultants. The message is, do not underestimate the ability of the oil industry to adapt: there can be cost cuts, restructuring and consolidation and that would take time, the sources said. "These two years, 2015-16, are still a discovery, everybody is talking about the economics of tight oil but nobody is talking with certainty… you have to wait and see," said a source from a Gulf OPEC producer. At its last meeting in November, OPEC kingpin Saudi Arabia persuaded fellow members to keep production unchanged, […]

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