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Oil Trades Near 3-Week Low as U.S. Gulf, East Coast Supply Rises

27 Oct 2016   Prices

Decline in national stockpiles caused by West Coast drop: EIA Gulf, East Coast inventories expand; U.S. production increases Oil traded near a three-week low below $50 a barrel as U.S. East and Gulf coast crude stockpiles rose along with nationwide production. Futures were little changed in New York after falling 1.6 percent Wednesday. While government data showed total U.S. inventories declined last week, they were pulled down mainly by a supply drop on the West Coast, a region that’s sometimes ignored by traders as its distribution system is isolated from the rest of the country. The nation’s crude output rose for a second week. Oil has fluctuated near $50 a barrel amid uncertainty about whether the Organization of Petroleum Exporting Countries can implement the first output cuts in eight years at an official gathering in November. An OPEC committee will meet this week to try to resolve differences over […]

Brent crude oil dips below $50 on doubts OPEC can coordinate output cut

27 Oct 2016   Prices

Oil prices were below $50 per barrel on Thursday on doubts OPEC will be able to bring together its members and Russia to organize a coordinated crude production cut. International Brent crude oil futures LCOc1 made a push above $50 per barrel early on Thursday, but had dipped back to $49.91 by 0034 GMT, 7 cents below their last closing price. WTI futures were trading at $49.17 per barrel, down 1 cent from their previous settlement. Traders said Brent was struggling to break above $50 over doubts that the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers like Russia will be able to effectively coordinate curbs in output to prop up prices. “Investors remain uncertain as to whether OPEC can implement the tentative agreement to cut production,” ANZ bank said on Thursday. A cut is being pushed by Saudi Arabia, OPEC’s biggest producer, and it is being […]

Oil prices drop as concerns over global fuel glut re-emerge

27 Oct 2016   Prices

A worker walks past a drilling rig at a well pad of the Rosneft-owned Prirazlomnoye oil field outside the West Siberian city of Nefteyugansk, Russia, August 4, 2016. Oil prices fell more than one percent on Wednesday as a report showing a surge in U.S. crude stocks, rising production in Nigeria and squabbling among producers about a planned output cut re-ignited concerns about a global supply glut. Brent crude futures LCOc1 were down 51 cents, or 1 percent, at $50.28 a barrel as of 0648 GMT. Prices hit $50.13 earlier in the session, the lowest since Oct. 3. U.S. crude CLc1 was at $49.37 per barrel, down 59 cents, or 1.2 percent, from its settlement on Tuesday. It dropped to $49.21 earlier, the lowest since Oct. 10. “Crude is on the defensive this morning following American Petroleum Institute (API) inventory numbers showing a rise of 4.8 million barrels against […]

Iraq lures investors to boost its oil output as OPEC debates cuts

27 Oct 2016   Iraq

Flames emerge from a pipeline at the oil fields in Basra, southeast of Baghdad, Iraq October 14, 2016. REUTERS/Essam Al-Sudani/File Photo As OPEC gathers in Vienna next month to consider cutting its oil output, a lower profile event in Baghdad on the same day will signal Iraq’s longer term ambition to do precisely the opposite. Nov. 30 is both the date when OPEC ministers meet in the Austrian capital and the deadline set by Iraqi oil minister Jabar Ali al-Luaibi for international firms to submit bids to help it develop 12 “small and medium-sized” oil fields. Crude output in Iraq, OPEC’s second largest producer, is already rising dramatically despite corruption, poor infrastructure and the fight against Islamic State. This is complicating OPEC’s efforts to revive prices by making its first output cut since the 2008 global financial crisis. Ministers from the Organization of the Petroleum Exporting Countries are supposed […]

Full Scale Oil Price Recovery Unlikely As 5000 DUC’s May Come Online

27 Oct 2016   Shale Oil

A backlog of oil wells that have been sitting idle could put renewed pressure on oil prices once the oil starts flowing. Oil prices dipped just below $50 per barrel this week on several pieces of bad news, including comments from Iraqi officials that cast doubt on the chances of an OPEC deal in November and the rising output from Nigeria. OPEC successfully sparked an oil price rally last month when it reached a tentative deal Algiers to cut output, but without a solid and meaningful deal in Vienna in November, the group could disappoint the markets. “OPEC appears to be approaching the limits of its ability to jawbone oil higher without something concrete to put on the table,” Jeffrey Halley, a senior market analyst at the brokerage firm OANDA, told Reuters in an interview. Without OPEC rumors to push up crude, oil traders will turn their […]

Will Libya Turn Its Back On The OPEC Deal?

27 Oct 2016   Libya

Oil tanker The exploration of oil in Libya began in 1955, four years after the country was declared independent. 40 companies were given an area of 600,000 km2 to explore over ambitious geological speculations that the country may have some oil reserves underneath its surface. By 1959 it was a fact: the country is sitting on the largest oil reserve in the continent, and the 9th largest in the world (Currently estimated at around 48 billion barrels) Libya joined the Organization of Petroleum Exporting Countries, OPEC, in 1962, a year after it started exporting oil, and has been a member since then. The country quickly became an important contributor to the global supply of light, sweet (low sulfur) crude oil, which was mostly exported to the European markets. Oil exports from Libya quickly ramped up to 3.4 million barrels per day, creating an unprecedented source of revenues for the […]

Major IS counter-attacks foreshadow new insurgency

27 Oct 2016   Iraq

Even as they lose ground around Mosul, IS militants showed their capacity for guerilla warfare, deploying 100-man squads to exploit security gaps in Kirkuk and Anbar. Kirkuk police and Peshmerga forces conduct search and raid operations in the Jrada-Ogolo village south of Kirkuk city on Oct. 23, 2016, in an effort to capture some of the Islamic State militants who had recently launched a deadly attack. Two major assaults by militants from the self-proclaimed Islamic State (IS) over the weekend highlighted the group’s undiminished capacity to wage a catastrophic insurgency even as it loses ground in a conventional war for control of Mosul.The attacks, one in Kirkuk and the other in Rutba, in Anbar province, killed more than 100 people and exposed Iraq’s inability to adequately defend government-held territory while also devoting roughly 25,000 troops – including many of the most capable uni…

Nigeria: Niger Delta Avengers Resume Hostilities, Bombs Chevron Export Pipeline

27 Oct 2016   Nigeria

Warri — After about three months of quiet, the Niger Delta Avengers resumed destruction of oil and gas infrastructure yesterday, when it bombed a Chevron-operated export pipeline at Escravos in Warri South Local Government Area of Delta State. The attack on the major pipeline came as a surprise to security forces in the oil-rich region, as they had lowered their guard in anticipation of a negotiated peace agreement between the militants and the federal government. The militant group claimed its Strike Team 06 brought down the export pipeline at about 3:45 a.m. yesterday as warning to all international oil companies (IOCs) to heed to its warnings not to effect repairs to their bombed facilities pending the negotiations or dialogue with the people of the Niger Delta. According to a statement by the group’s spokesperson, Mudoch Agbinibo, NDA said: “Today at about 3:45 a.m. our Strike Team 06 took down […]

Nigeria: Mass Sack in Nigeria’s Oil Industry, Over 3,000 Affected

27 Oct 2016   Nigeria

There has been mass sack of over 3,000 workers in Nigeria’s oil industry as the country’s economic recession bites harder, two unions have said. The two major unions in the oil and gas sector, NUPENG and PENGASSAN, have thus threatened to go on strike saying over 3,000 of their members were affected. The unions on Wednesday issued a 21-day ultimatum to the federal government calling for a halt to the sack of their members by international oil companies in Nigeria. The National President of NUPENG, Igwe Achese, who addressed the media at the end of the Central Working Committee, CWC, meeting of the union in Effurun, Delta State, said government must do something urgently to stop the mass retrenchment of its members to avoid grounding the industry. Mr. Achese disclosed that most of the companies – Chevron Nigeria Limited, ExxonMobil, Pan Ocean, Sapiem, and Hercules oil and gas limited, […]

OPEC May Need Help to End the Global Glut of Oil

27 Oct 2016   OPEC

Algiers deal aims to fix unprecedented oil-inventory glut Even the maximum cut OPEC’s considering wouldn’t achieve this Even if OPEC defies a skeptical market by implementing output cuts in full, it still won’t drain the ocean of surplus oil already pumped from the ground. The Organization of Petroleum Exporting Countries aims to shrink the world’s bloated oil inventories with its first production cut in eight years, according to Secretary-General Mohammed Barkindo. Yet the bloc’s own data show that even the maximum reduction under consideration would barely dent record stockpiles next year. That makes securing help from competitors — chiefly Russia — critical to ending the glut. Global supplies have exceeded demand for three years straight, resulting in the accumulation of an oil-inventory surplus big enough to fill about 160 supertankers. While cutting output to the lower end of the range adopted last month would stop a further expansion, it […]

Enraged Venezuela opposition escalates anti-Maduro protests

27 Oct 2016   Venezuela

Venezuela’s increasingly militant opposition stepped up its push to remove leftist leader Nicolas Maduro on Wednesday with rallies that drew hundreds of thousands of protesters and calls for a general strike and march on the presidential palace. Enraged by last week’s suspension of their push for a referendum to remove Maduro and determined to end 17 years of socialism in the South American OPEC nation, Venezuela’s opposition has sharply ramped up its tactics in recent days. Maduro, the unpopular 53-year-old successor to Hugo Chavez who has presided over an unprecedented economic crisis, accuses the opposition of seeking a coup with U.S. help. “They are desperate, they have received the order from the north to destroy the Venezuelan revolution,” he told a counter-march of red-shirted government loyalists. After launching a political trial against Maduro on Tuesday in the National Assembly, the opposition coalition held nationwide marches dubbed “Takeover of […]

Nigerian union says oil firms sack 3,000 workers, asks government to step in

27 Oct 2016   Nigeria

Oil firms operating in Nigeria have sacked about 3,000 workers, a labor union official said on Wednesday, calling on the government to file a protest with foreign oil operators. “The government should call the multinationals to order. They are sacking and closing shop,” Igwe Achese, president of the National Union of Petroleum and Natural Gas, told Reuters after a union meeting. “So we want government to act. That’s why we have given a 21-day ultimatum,” he said. “We believe government would act. If they don’t, when we get to the bridge, that is at the expiration of the ultimatum, we will cross it. I don’t want to use the word ‘strike’ now.” Nigeria’s Premium Times said on its website that Exxon Mobil, Chevron, Pan Ocean and Saipem were among the firms that had dismissed oil workers. Chevron had no immediate comment, while the Premium Times said Exxon Mobil had […]

Lung Association report highlights health and climate costs of petroleum-based transportation and the benefits of shifting to ZEVs

27 Oct 2016   Air Quality

A new report produced by the American Lung Association concludes that over-reliance on petroleum-based fuels for transportation costs the 10 ZEV states in the US (California and nine other states that have adopted the California Zero Emission Vehicle (ZEV) program) an estimated $37 billion in health expenses and climate costs every year—with California costs alone hitting $15 billion. Of that $37 billion, health costs added up to $24 billion in 2015; the $24 billion represents the monetized sum of harmful emissions responsible for an estimated 220,000 work-loss days, more than 109,000 asthma exacerbations, hundreds of thousands of other respiratory impacts, and 2,580 premature deaths. The report, Clean Air Future: Health and Climate Benefits of Zero Emission Vehicles , was produced by the American Lung Association in California. Under this report’s “ZEV Future” scenario, 100% of the new car sales and approximately 65% of all cars on the road are […]

Cnooc Third-Quarter Sales Drop 15% as Output Falls With Spending

27 Oct 2016   China

Output falls 7.7% to 117.7 million barrels of oil equivalent Capital spending declined almost 21% to 11.7 billion yuan Cnooc Ltd., China’s biggest offshore oil and gas producer, posted a 15 percent fall in third-quarter sales as output declined with capital spending. Revenue from oil and natural gas was 30.75 billion yuan ($4.5 billion) in the three months ended Sept. 30, the Beijing-based company said in a statement to the Hong Kong stock exchange Wednesday. Cnooc, which doesn’t report quarterly profit, said output fell 7.7 percent. “Cnooc’s sales decline was well expected as oil prices haven’t rebounded to a level that may push the offshore producer to increase output,” Tian Miao, a Beijing-based analyst at North Square Blue Oak Ltd. “Fourth-quarter output should be similar to the third-quarter, and Cnooc may continue to pay a high dividend to please shareholders in the low-crude environment.” Brent oil, the global benchmark, […]

Bankruptcies In Oilfield Services Are Accelerating

27 Oct 2016   Shale Oil

Oilfield services Clouds have been clearing for oil producers in the U.S. oil patch, but it looks like things are a bit different in oil field services. In fact, they’re quite a bit different: according to a recent Haynes & Boone analysis, bankruptcies in the oil field services sector have boomed from about 20 last September to as much as 100 as of last month. In October, eight oil field service providers filed for Chapter 11 restructuring. Also, according to Haynes & Boone, the total cumulative debt of U.S. oil field service providers reached US$14 billion as of this September. In absolute terms, the number of bankruptcies among E&Ps and their combined debt is higher than the figures for oil field service providers. The bankruptcy filings in the two sectors are almost equal, but in production, the rate of new filings has slowed down considerably in the last few […]

Three New England states move on 460 MW of renewables

27 Oct 2016   Renewables

After reviewing bids offered in a multi-state request for proposals, Massachusetts, Connecticut and Rhode Island are entering contract negotiations to buy power from six projects totaling about 460 MW, with most of the generation coming from solar projects. The smaller-than-expected procurement is “consistent with our understanding that the initial RFP was to be used as a procurement vehicle to test for market pricing,” UBS Securities said Wednesday. The equity firm expects a larger Massachusetts-led RFP to be issued next spring will be “the ‘real’ opportunity for project procurement.” The states received 24 offers in response to a mid-November clean energy RFP. By jointly seeking renewable supplies, the states expected to be able to reduce the price of the offers, which are confidential. The winning bidders announced Tuesday include Ranger Solar, based in Yarmouth, Maine, with a proposal for five solar farms in Connecticut, Maine and New Hampshire totaling 220 […]

Audi realigns motorsport strategy: electric instead of endurance; out of FIA WEC at end of 2016 season

27 Oct 2016   Electric Cars

Audi is realigning its motorsport strategy. The brand will terminate its FIA WEC commitment, including the 24 Hours of Le Mans, at the end of the 2016 season. Instead, Audi is taking up a factory-backed commitment ( earlier post ) in the all-electric Formula E racing series. Speaking to 300 employees of the motorsport department on Wednesday morning, Chairman of the Board of Management Rupert Stadler put this strategic decision in the context of the current burdens on the brand, asserting that it was important to focus on things that would keep Audi competitive in the years ahead. That is why the Board of Management had decided to terminate Audi’s commitment in endurance racing. We’re going to contest the race for the future […]

Statoil Posts Surprise Loss on Low Oil Prices, Cuts Spending

27 Oct 2016   Norway

Statoil ASA, the first of the major oil producers to report third-quarter earnings, posted an unexpected loss for a second quarter in a row as maintenance and exploration expenses compounded the impact of lower crude and gas prices. The company also deepened spending cuts. The adjusted loss, which excludes financial and other items, was $261 million, compared with a profit of $445 million a year earlier, Norway’s biggest oil company said Thursday. That missed the $136 million average profit estimate of 18 analysts surveyed by Bloomberg. “The financial results were affected by low oil and gas prices, extensive planned maintenance and expensed exploration wells from previous periods,” Chief Executive Officer Eldar Saetre said in a statement. “Strict prioritization and continued good results from our improvement program” allow further cuts to 2016 capital expenditure and exploration guidance, he said. Statoil, 67 percent owned by the government, and rivals such as […]

Airbus Cuts Almost 600 Helicopter Jobs as Crash, Oil Clip Demand

27 Oct 2016   France

A technician works on a helicopter component in the fabrication and assembly room of the Airbus Helicopters Canada facility in Fort Erie, Ontario, Canada. Earnings from ‘chopper’ arm fell 17% in first nine months Airbus Group SE announced the first of what may prove to be thousands of job cuts across its business, saying it will eliminate almost 582 posts at its helicopter arm following a slump in demand from the oil and gas industry and a fatal crash that grounded one of its most popular models. The cuts will come at the main Airbus Helicopters base in Marignane, near Marseille, which has an 8,944-strong workforce, and La Courneuve, on the outskirts of Paris, which employs 750 people, and amount to about 6 percent of the unit’s French payroll. The division has about 23,000 staff worldwide. The loss of an H225 Super Puma in the North Sea on April […]

Germany votes against the internal combustion engine

27 Oct 2016   -

Germany’s lower house of parliament, the Bundesrat, voted in October to ban the sale of cars with internal combustion engines by 2030. It is a resolution with no binding implications, but it did garner cross-party support. It is certainly a powerful statement of intent. Viewed from the capitals of the major oil exporting countries, it should be viewed with alarm, not that it will necessarily be achieved, but as a reminder that in combination with the technologies to deliver them, environmental targets only ever seem to get more ambitious in scope and in timing. For oil producers, the idea that some oil will be left in the ground forever is a strong motivation to produce now. Revenue maximization no longer lies in controlling supply to support prices over time because time is running out. There is no point husbanding resources for future generations that reject their use. But, in […]

Oil Falls as U.S. Supply Seen Rising While Russia Dismisses Cuts

26 Oct 2016   Prices

Nationwide crude stockpiles gain by 4.75 million barrels: API Russia prefers production freeze to cuts: Nation’s OPEC envoy Oil dropped for a third day after industry data showed U.S. crude stockpiles expanded as Russia said it preferred freezing output at current levels rather than cutting production. Futures declined as much as 1.5 percent in New York after closing below $50 a barrel Tuesday for the first time in more than a week. U.S. crude inventories increased by 4.75 million barrels last week, the American Petroleum Institute was said to report. Energy Information Administration data Wednesday is forecast to show supplies rose. Output cuts are not an option for Russia, the nation’s envoy to OPEC said, according to Interfax. Oil has fluctuated near $50 a barrel amid uncertainty about whether the Organization of Petroleum Exporting Countries can implement the first output cuts in eight years and attract producers from outside […]

Oil prices drop as concerns over global fuel glut re-emerge

26 Oct 2016   Prices

A worker walks past a drilling rig at a well pad of the Rosneft-owned Prirazlomnoye oil field outside the West Siberian city of Nefteyugansk, Russia, August 4, 2016. Oil prices fell more than one percent on Wednesday as a report showing a surge in U.S. crude stocks, rising production in Nigeria and squabbling among producers about a planned output cut re-ignited concerns about a global supply glut. Brent crude futures LCOc1 were down 51 cents, or 1 percent, at $50.28 a barrel as of 0648 GMT. Prices hit $50.13 earlier in the session, the lowest since Oct. 3. U.S. crude CLc1 was at $49.37 per barrel, down 59 cents, or 1.2 percent, from its settlement on Tuesday. It dropped to $49.21 earlier, the lowest since Oct. 10. “Crude is on the defensive this morning following American Petroleum Institute (API) inventory numbers showing a rise of 4.8 million barrels against […]

Oil Prices Plunge After API Reports Significant Build To U.S. Crude Stocks

26 Oct 2016   Prices

Natural gas storage American crude oil supplies surged upwards by 4.8 million barrels this week, almost completely offsetting last week’s 5.2-million-barrel draw, according to the American Petroleum Institute (API) report released on Tuesday. This week’s inventory build will likely press further down on oil prices, which were already trading down on the market’s increasing uneasiness over the OPEC drama, including Iraq’s OPEC rebellion , Russia’s vague and vacillating comments as to whether they’ll join in a freeze or a cut, and Venezuela’s pleas to get non-OPEC members to cut in proportion to the bloc’s to-be-determined limits. The West Texas Intermediate (WTI) price settled to three-week lows once the report went public Tuesday afternoon. At the time of the report’s writing, WTI stood at $49.30 – down 2.41 percent from the day’s start, while Brent fell to $50.29, or 2.27 percent from the open. Experts had predicted an inventory build […]

Oil prices dip on OPEC squabbles ahead of planned production cut

26 Oct 2016   Prices

Oil prices dipped early on Tuesday over disagreement within producer cartel OPEC on who should cut how much production in a planned coordinated reduction to prop up prices. International Brent crude oil futures were trading at $51.38 per barrel at 0117 GMT, down 8 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures were down 5 cents at $50.47 a barrel. Iraq’s oil minister Jabar Ali al-Luaibi said the second-largest producer in the Organization of the Petroleum Exporting Countries (OPEC) wanted to be exempt from output curbs as it needed more money to fight Islamic State militants. “Crude oil prices labored under the weight of various OPEC members seeking exemption from the production cut agreement,” ANZ bank said on Tuesday. Until there is more clarity on the planned cut, which OPEC hopes will […]

Russia Still Vague On Oil Freeze While Venezuela Wishes On A Star

26 Oct 2016   Russia, Venezuela

Rosneft office Russian Energy Minister Alexander Novak is still keeping his cards close to his chest, with the ministry reporting that he discussed with his Venezuelan counterpart, Eulogio del Pino, “coordinating action” to rebalance oil markets. Del Pino visited Moscow earlier today, also meeting with Rosneft’s chief Igor Sechin, as part of efforts to help negotiations among OPEC members head in the right direction from Venezuela’s perspective. The South American country is perhaps the hardest-hit by the oil price crisis, with its economy in shambles and close to defaulting on its debt. According to Del Pino, his country proposed during this meeting that non-OPEC countries take 400,000 to 500,000 barrels per day out of the market—a lofty goal indeed given the small amount of cuts OPEC was suggesting they themselves would take offline. Russia’s energy top cat has made several noncommittal remarks regarding production levels this past week during […]

Big Oil Braces for Profit Pain as Refining Safety Net Slips

26 Oct 2016   Refining

Global oil-processing margins shrank 42% last quarter: BP data Oil majors enjoyed one of the best years for refining in 2015 The world’s biggest oil companies, supported during crude’s collapse by a buoyant refining business, have lost that buffer as brimming fuel stockpiles swamp demand. Profits from turning oil into gasoline and diesel contracted 42 percent last quarter from a year earlier to an average $11.60 a barrel, the weakest for the time of year since 2010, industry data from BP Plc show. The impact of that will be apparent as earnings for the period roll in over the coming weeks. Refineries benefited from oil’s two-year slide that began in mid-2014 because the cost of feedstock fell while fuel demand rose. That led to over-production and huge stockpiles that now can’t be absorbed. For oil majors including Exxon Mobil Corp. and BP, that erodes a valuable source of income […]

OPEC Is at ‘Hardest’ Stage in Its History, Chief Barkindo Says

26 Oct 2016   OPEC

Secretary-general comments after meeting Iraqi oil minister Minister Al-Luaibi ‘optimistic’ nations can reach output deal OPEC Secretary-General Mohammed Barkindo said the 14-nation group is facing its toughest challenge as members debate oil-production cuts needed to balance the market. “OPEC has gone through good times and conditions for more than half a century and hard ones too, and the current stage is the hardest one,” Barkindo said during a visit to Baghdad in remarks distributed by Iraq’s Oil Ministry. OPEC is working hard on a solution to stabilize the market, he said after meeting Oil Minister Jabbar Al-Luaibi for talks. Iraq, the second-largest producer in the Organization of Petroleum Exporting Countries, threw an obstacle in OPEC’s path toward a production-cuts deal this weekend when it balked at joining efforts to trim output. The country should be exempted from curtailing supply because it’s embroiled in a war with Islamic militants, Al-Luaibi […]

Blame OPEC for the price at the pump

26 Oct 2016   Prices

 Coordinated efforts from OPEC are partially behind what would otherwise be a period of historically lower U.S. gasoline prices, market analyses find. Motor club AAA reports a national average retail price for a gallon of regular unleaded gasoline at $2.23 for Tuesday, about a half percent lower than last week. Year-on-year, the price for gas is about 1 percent higher, which rival analysis from finds is the first time that’s been the case in nearly two and a half years. Patrick DeHaan, a senior analyst with GasBuddy, blamed the year-on-year increase on the Organization of Petroleum Exporting Countries. “The trend that has delivered consistently lower gas prices is showing signs of fading away as consistent discussion from both OPEC and non-OPEC members appears to be […]

Oil Prices Slide on OPEC Questions

26 Oct 2016   Prices

Oil prices closed down Tuesday with traders still skeptical about whether OPEC makes the production cuts members in late September promised that they would consider. Light, sweet crude for December delivery settled down 56 cents, or 1.1%, at $49.96 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell 67 cents, or 1.3%, to $50.79 a barrel on ICE Futures Europe. In September, the Organization of the Petroleum Exporting Countries reached an understanding that there was a need to scale back production, which has helped keep the market above $50 for most of October. OPEC members will wait until the next official meeting in November to complete the details, including the quota for individual producers. But many are still skeptical about whether they can make a deal work. The latest question surrounds Iraq’s refusal to accept production data from secondary sources as the basis to calculate […]

Iraq seeks OPEC deal that would preserve oil output

26 Oct 2016   Iraq, OPEC

The OPEC logo is seen outside their headquarters in Vienna, Austria, October 24, 2016. Iraq told a top OPEC official on Tuesday of its hope that the group could reach a deal to lift oil prices while preserving its own output level, a spokesman of the oil ministry said. Iraqi Oil Minister Jabar al-Luaibi and OPEC Secretary General Mohammed Barkindo, who is is trying to bring about an agreement on supply cuts that would support sagging prices, met in Baghdad ahead of the cartel’s meeting on Nov. 30. “The minister expressed support for the efforts of the secretary general … and optimism that the meeting would lead to decisions in favor of crude producers,” oil ministry spokesman Asim Jihad told Reuters. Luaibi, he said, also briefed Barkindo about Iraq’s “real production” figures, which are higher than those estimated by so-called secondary sources adopted by OPEC. “These figures are the […]

Saudi Arabia Faces Tough OPEC Equation With Mounting ‘Exemptions’

26 Oct 2016   OPEC, Saudi Arabia

OPEC must reduce output by at least 1.3 million barrels a day Iraq joins list of nations seeking exemption from Algiers deal Saudi Arabia faces the prospect of much deeper — and financially painful — oil production cuts after Iraq joined the queue of group members seeking immunity from the deal hatched in Algiers. In addition to Iraq, the second-biggest exporter in the group, Iran has already sought to exclude itself. Output is also recovering from fields in Nigeria and Libya, two more countries that were exempted from the Algiers deal because violence has wrought havoc in their oil industries. Taken together, more than a third of OPEC’s production now stands outside the plan. Iraq’s plea to be left out prompted Olivier Jakob, a consultant at Petromatrix GmbH, to quip on Twitter that the oil club stood for the “Organization of Producers Exempt from Cuts.” The worsening OPEC equation […]

For Iran, Exerting Force While Making Nice Is Part of the Plan

26 Oct 2016   Iran

TEHRAN — Just as conservative opponents of the nuclear deal with Iran had warned , Tehran seems to be moving aggressively to expand its regional influence while working to counter American interests throughout the Middle East. Yet, just as proponents of the deal had promised, Iran is also slowly opening up, cutting deals with Western businesses, establishing phone links with the United States, speeding up the internet, welcoming hordes of European tourists and relaxing some social restrictions on its own people. What would seem to be a puzzling contradiction is in fact a carefully thought-out, two-track policy being pursued by the supreme leader, Ayatollah Ali Khamenei, and the circle of leaders around him. Iranian generals are directing the ground war in Syria. Iranian advisers are tr aining Shiite militias fighting in Iraq and Syria. Iranian arms and other support help the Houthi rebels in Yemen. In addition to sanctioning […]

OPEC’s Indonesia Eyes 42% Oil Output Boost 2017

26 Oct 2016   Indonesia

Pertamina oil Amid rising doubts about OPEC’s crude oil production freeze agreement, one member of the organization that’s so far stayed out of the spotlight has declared its plans to raise oil output by 42 percent in 2017. A spokeswoman for Indonesia’s state-owned oil firm Pertamina said that the company seeks to raise its total output to 438,000 bpd next year, up from an average of 308,000 bpd in 2016. Wianda Pusponegoro added that most of the increase will come from acquisitions in Russia, Iran, and Iraq. Indonesia’s own oil deposits are on the whole mature, with peak production well behind them. Earlier this month, media reported that Pertamina and Rosneft had sealed a deal for the construction of a refinery in Indonesia, which may also include Pertamina buying into Russian production projects. According to Rosneft, the Indonesian company could get up to 20 percent in the Northern Chayvo […]

Is ISIS Giving Up On Oil?

26 Oct 2016   Iraq

Iraqi oil field Since the Iraqi army drove out Islamic State forces from the oil-rich towns of Shargat and Qayyarah last month, ISIS has lost its ability to produce oil and profit from crude oil sales on the black market—but ISIS is proving to be highly adaptable, and able to find new markets quickly; this time in agriculture. A quick read of American intelligence on ISIS oil revenues shows this outcome had been anticipated. The Department of Defense confirmed that oil revenues were no longer the Islamic State’s main source of funding back in February 2015. “The main source of revenue for them used to be oil,” Pentagon Press Secretary Navy Rear Adm. John Kirby told reporters at the time. “Now we assess that it’s no longer the main source of revenue.” Kirby could not disclose how far the terrorist group’s revenues had fallen since 2014, when ISIS’ oil […]

Can Saudi Arabia Scramble Out Of The Pit It Dug for Itself?

26 Oct 2016   Saudi Arabia

Oil Field Middle East Major changes are brewing in Saudi Arabia, and there is no way to stop them if the kingdom’s economy is to survive the oil price rout. This is what has become painfully clear after last week, Deputy Economy Minister Mohammad Al Tuwaijri slammed the country’s bureaucracy for being lazy and inefficient, stressing that the economy is far too oil-dependent. He added that, were it not for cost-cutting measures taken by the government, the kingdom would be bankrupt within four years. Although Al Tuwaijri later apologized for these remarks, saying “bankruptcy” was too strong a word, he noted that Saudi Arabia did indeed have a “structural economic problem,” an expression some would consider a massive understatement, but understandable in the context of the culture. Saudi Arabia has not had to deal with a budget deficit for decades, but last year it had a deficit equal to […]

Nigerian oil export pipeline attacked

26 Oct 2016   Nigeria

Nigerian crude oil exports disrupted after the Niger Delta Avengers militant group attacked a pipeline operated by a subsidiary of Chevron. Photo by vanhurck/Shutterstock ABUJA, Nigeria, Oct. 25 (UPI) — The group calling itself the Niger Delta Avengers said its fighters on Tuesday took out an oil export pipeline in Nigeria operated by Chevron. “This action is to further warn all international oil companies that when we warn that there should be no repairs pending negotiation/dialogue with the people of the Niger Delta, it means there should be no repairs,” Niger Delta Avengers spokesman Mudoch Agbinibo said in a statement . The militant group, which surfaced early this year, is fighting for a greater share of the oil wealth from Nigeria, which is a member of the Organization of Exporting Countries. The group has been in various stages of peace talks with the government since the summer. Nigerian crude […]

Nigerian Oil Under Attack Once Again

26 Oct 2016   Nigeria

NDA Attack Nigeria has managed to increase its daily crude oil production to 1.9 million barrels , according to a tweet from the Petroleum Ministry. That’s still short of the country’s 2.2-million-bpd output before the militant attacks on oil infrastructure in the Niger Delta began a couple of years ago, but it is substantially better than the 1.3 million bpd Nigeria produced in the spring of 2016. But the 1.9 million barrels per day level may be unsustainable in the inhospitable environment of the Niger Delta, with a fresh wave of attacks announced on Tuesday at the hands of the most active militant group in the area, the Niger Delta Avengers, or NDA. Although the federal government of Nigeria has been in negotiations with the NDA to find ways to appease its members and restore oil production to more lucrative levels, the talks have had mixed results did not […]

Nigeria: Offshore Rig Count Declines to Seven

26 Oct 2016   Nigeria

Nigeria’s offshore rig count from June till September has reduced to seven from 11 recorded as at end first half 2016, H1’16, indicating that four rigs were shut down in third quarter, Q3’16, Baker Hughes, global oil industry data and information company stated in its oil data report. This is coming as Baker Hughes reported that the international offshore rig count for September 2016 was down by 47 rigs The data stated that funding cuts by the Nigerian National Petroleum Corporation, NNPC, and growing security concerns may have triggered a significant drop in the number of offshore oil rigs involved in drilling operations. The report is, however, not in tandem with the latest (September) Organisation of Petroleum Exporting Countries, OPEC data which stated that Nigeria’s oil rig count remains unchanged as it stood at 24 both in June and July. Chairman of Nigeria’s chapter of the International Association of […]

Nigeria’s oil production climbs up to 1.9 million b/d: oil ministry

26 Oct 2016   Nigeria

Nigeria’s oil production has risen to 1.9 million b/d, the oil ministry said Tuesday, even as the government has begun moves for all-inclusive talks with Niger Delta leaders to end militancy in the region and bolster oil production. “We have built capacity of up to 2.4 million b/d, but [we are] currently producing about 1.9 million b/d,” Omar Farouk, the special adviser on international energy relations to Nigeria’s oil minister of state, said on the ministry’s twitter handle. Farouk said Nigeria was in urgent need of new investments to increase its reserve base and output. “Nigeria has produced over 10 billion barrels of oil since the year 2000. However, we have not discovered this much in the same period,” he said. 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 […]

Shell To Resume Exports From Terminal Attacked By Militants

26 Oct 2016   Nigeria

NDA combatants The Nigerian presidency on Tuesday issued a statement affirming that Royal Dutch Shell will resume exports from the Forcados terminal in the Niger Delta region. “The Shell Director, Mr. Andrew Brown, informed the President of the resumption of oil exportation through the Forcados terminal following its restoration,” the Nigerian presidency said following a meeting between Brown and President Muhammadu Buhari. Operations at Forcados had been halted after an attack last February against the facility attributed to the Niger Delta Avengers (NDA). Some 250,000 to 300,000 barrels of crude were produced prior to the assault. The Petroleum Ministry announced intentions to raise daily crude output to 1.9 million barrels per day, but that goal is in danger from activity by militant groups active in the Niger Delta. Prior to the announcement of the reopening of Forcados, the NDA attacked Chevron’s offshore export pipeline at Escravos on Tuesday. “This […]

Nigeria: Oil Exports Resume At Key Terminal Destroyed By Niger Delta Avengers

26 Oct 2016   Nigeria

Oil exports have resumed at Forcados terminal, a key platform attacked by the Niger Delta Avengers in early 2016. The director of Shell Oil Company’s Global Upstream, Andrew Brown, confirmed the development on Tuesday. He spoke at a meeting with President Muhammadu Buhari. Forcados, with a 400,000 barrels-per-day capacity, was attacked by the so-called Niger Delta Avengers in February. The attack significantly cut Nigeria’s oil output. It compelled Shell to announce a force majeure, a declaration made by a party to an agreement when it is unable to meet an obligation due to unforeseen circumstances. The Nigerian National Petroleum Corporation (NNPC) said at least N689 billion was lost during the period. It is unclear when Shell and its partners, Axion Energy Argentina SA and Pampa Energia SA, actually resumed sales of oil through the channel. Although the repair of the terminal was initially scheduled for May, reports suggested that […]

After 20,000 Job Cuts, World’s Top Shipyards Brace for More

26 Oct 2016   South Korea

South Korea’s shipbuilding industry — home to the world’s top three manufacturers — has eliminated more than 20,000 jobs this year. They may not even be halfway through. Hyundai Heavy Industries Co., Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co. are among builders that have sent workers home and the industry could lose as many as 40,000 more positions by the end of this year, the Korea Labor Institute estimated. The sector employed 163,000 people at the end of June, down from 183,000 at the end of December, according to the Korea Offshore & Shipbuilding Association. The “Big Three” yards have lost a combined 6.6 trillion won ($5.8 billion) in the last six quarters amid delivery delays and a plunge in demand for new vessels and shipping platforms used for drilling oil in deep sea. Once South Korea’s biggest export, shipbuilding has now slipped down the […]

Baker Hughes sees recovery on the horizon

26 Oct 2016   USA

Results for the third quarter were indicative of a market under pressure, though oilfield services company Baker Hughes said recovery was on the horizon. The company, which was the target of a takeover bid by rival Halliburton at the depth of the market downturn early this year, said it took a $429 million net loss for the third quarter. That follows steep reductions in staffing, but marks an improvement over the $911 million loss during the previous quarter . Chairman and CEO Martin Craighead said project delays and a reduction in activity in the Gulf of Mexico, West Africa and Norwegian operations were to blame for much of the declines for the third quarter. “Looking ahead, in the fourth quarter of 2016 we expect activity in North […]

Offshore production nearly 30% of global crude oil output in 2015

26 Oct 2016   Offshore

Source: U.S. Energy Information Administration, based on Rystad Energy Global offshore oil production in 2015 was at the highest level since 2010, and accounted for nearly 30% of total global crude oil production. Offshore oil production increased in both 2014 and 2015, reversing consecutive annual declines from 2010 to 2013. Production from onshore tight oil plays has increased faster over the past several years and accounts for an increasing amount of total oil production. More than 27 million barrels of oil were produced offshore in 2015 in more than 50 different countries. Global crude oil production is expected to remain high in 2016, as many oil producing nations continue to increase production. A significant amount of global offshore production is concentrated in a few countries. In 2015, five countries provided 43% of total offshore oil production: Saudi Arabia, Brazil, Mexico, Norway, and the United States. Source: U.S. Energy Information […]

Clouds gather in rooftop solar’s biggest U.S. market

26 Oct 2016   Solar

For years, the quiet, winding streets of the Scripps Ranch neighborhood have been pure gold for solar installers. Thanks to its high power prices, hot summers and large homes to cool, a greater share of Scripps Ranch residents have embraced solar power than anywhere else in California, itself the nation’s solar energy leader. The rooftops of some 2,000 homes – 26 percent – are fitted with panels in Scripps Ranch, according to an analysis of state and utility solar installation numbers and U.S. Census Bureau housing data by the non-profit Center for Sustainable Energy and the environmental news web site EcoWatch. The growth has been rapid. In July of 2014, San Diego installer Sullivan Solar put up […]


26 Oct 2016   Russia

Russia is a major producer and exporter of oil and natural gas. Russia’s economic growth is driven by energy exports, given its high oil and natural gas production. Oil and natural gas revenues accounted for 43% of Russia’s federal budget revenues in 2015. 1 Russia was the world’s largest producer of crude oil including lease condensate and the third-largest producer of petroleum and other liquids (after Saudi Arabia and the United States) in 2015, with average liquids production of 11.0 million barrels per day (b/d). Russia was the second-largest producer of dry natural gas in 2015 (second to the United States), producing 22.4 trillion cubic feet (Tcf), according to Russian Energy Ministry data. 2 Russia and Europe are interdependent in terms of energy. Europe is dependent on Russia as a source of supply for both oil and natural gas, with almost 30% of European Union crude imports and more […]

Why The Peak Oil Argument Refuses To Die

26 Oct 2016   Peak Oil

The Peak Oil argument refuses to die. Today it has morphed into the Peak Conventional Oil argument. There are parts of the argument I agree with such as any finite resource will eventually run out, either due to regulation or over production, however, this is not what is happening right now. Humans are pessimistic for anthropological reasons. Life has been hard. Pessimism is even believed to be genetic , however, explaining the current woes of the oil industry by using the Peak Oil argument fails Occam’s Razor. There is a simpler explanation found in economics 101, the adjustment of an oligopoly dominated market to a free market. Econ 101 In a free market the quantity produced would be Qc and price Pc and in an oligopoly the price would be Po and quantity Qo. If the price is managed the perfect amount above the marginal cost curve […]

New Research Finds Antarctica’s Ice Shelves Are Melting Rapidly

26 Oct 2016   -

The Crosson Ice Shelf (center) and Mount Murphy (foreground) in Antarctica. Ice shelves are sensitive… The ice that hangs off Antarctica’s western edge is melting at a faster clip than it is being replenished, according to new research published Tuesday. Researchers estimate that between 2002 and 2009, Smith Glacier lost roughly between 980 and 1,600 feet of ice thanks to increased melting at its so-called grounding zones, regions where ice goes from being on land to floating on water, creating what looks like a shelf. Understanding how ice shelves are changing is crucial to predicting sea-level rise , said Ala Khazendar, a polar scientist at NASA’s Jet Propulsion Laboratory in Pasadena, Calif., and the study’s first author. Sea-level rise is already affecting coastal cities, like Miami , and scientists think the problem will only worsen globally as the planet warms. The authors also found that between 2009 and 2014, […]

Oil Rises as OPEC Chief Barkindo Seeks to Resolve Output Plan

25 Oct 2016   Prices

OPEC’s Barkindo said to visit Iraq amid supply deal push U.S. stockpiles probably rose by 1.25 million barrels: survey Oil climbed with OPEC’s secretary-general set to visit Baghdad on Tuesday for talks aimed at resolving a deal on output after Iraq said it should be exempt from planned cuts. Futures rose as much as 0.8 percent in New York after falling 0.7 percent Monday. Mohammed Barkindo will meet with Iraq’s prime minister and oil minister, according to people familiar with the matter, after the Organization of Petroleum Exporting Countries’ second-biggest producer said Sunday it should be excluded due to conflict with Islamic militants. U.S. crude stockpiles rose last week, a Bloomberg survey shows before government data Wednesday. Oil has fluctuated near $50 amid uncertainty about whether OPEC can implement an accord to reduce oil output when its members gather at an official meeting in November. A committee will meet […]

Oil prices dip on OPEC squabbles ahead of planned production cut

25 Oct 2016   Prices

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Oil prices dipped early on Tuesday over disagreement within producer cartel OPEC on who should cut how much production in a planned coordinated reduction to prop up prices. International Brent crude oil futures were trading at $51.38 per barrel at 0117 GMT, down 8 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures were down 5 cents at $50.47 a barrel. Iraq’s oil minister Jabar Ali al-Luaibi said the second-largest producer in the Organization of the Petroleum Exporting Countries (OPEC) wanted to be exempt from output curbs as it needed more money to fight Islamic State militants. “Crude oil prices labored under the weight of various OPEC members seeking exemption from the production cut agreement,” ANZ bank said on Tuesday. Until there is more clarity on the planned cut, which OPEC hopes will […]