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Oil prices steady ahead of key OPEC meeting

21 Sep 2017   Prices

Oil prices steadied on Thursday, holding most of their recent gains before a meeting of oil producers that could extend production limits aimed at clearing a glut that has depressed the market for more than three years. Ministers from the Organization of the Petroleum Exporting Countries, Russia and other producers meet in Vienna on Friday and are due to consider extending output cuts that began in January. OPEC and its allies have agreed to reduce output by about 1.8 million barrels per day (bpd) until March 2018 in an attempt to empty inventories. Many analysts now expect them to extend the deal, possibly to the end of next year. “An extension of the agreement or an increase […]

Oil Prices Gain On Improving Market Signals

21 Sep 2017   Prices

Oil prices rose to a four-month high on Wednesday, boosted by optimism that production cuts have brought down global inventories as demand remains steady. Light, sweet crude for October delivery settled up 93 cents, or 1.9%, to $50.41 a barrel on the New York Mercantile Exchange, the highest close since May 24. The October contract expired on Wednesday, and the more actively traded November contract rose 79 cents, or 1.6%, to $50.69. Brent, the global benchmark, gained $1.15, or 2.1%, to $56.29. Investors have become more optimistic about the oil market’s prospects recently amid signs of tighter balance between supply and demand in the global market. “Everything is basically falling into place for the last quarter of the year,” said Peter Cardillo, chief market economist at First Standard Financial. “Today’s close signals that $55 oil is not that far away.” U.S. refiners continued to ramp up operations as the […]

Oil up 2 percent despite U.S. crude build; set for best third quarter since 2004

21 Sep 2017   Prices

Oil prices rose nearly 2 percent on Wednesday, despite a rise in U.S. crude inventories, with the market heading for its largest third-quarter gain in 13 years after the Iraqi oil minister said OPEC and its partners were considering extending or deepening output cuts. Brent crude futures rose $1.06, or 1.9 percent, to $56.20 a barrel by 12:19 p.m. EDT (1619 GMT), while U.S. West Texas Intermediate (WTI) crude futures gained 91 cents, or 1.8 percent, to $50.39. Crude prices were on course for a rise of nearly 16 percent this quarter, which would make this year’s performance the strongest for the third quarter since 2004. U.S. crude oil stockpiles jumped last week as imports and production increased, the U.S. Energy Information Administration said, as operations resumed from the impact of Hurricane Harvey which hit the Gulf Coast on Aug. 25. Crude inventories rose for […]

Iran says it does not expect U.S. to leave nuclear deal

21 Sep 2017   Iran

UNITED NATIONS (Reuters) – Iran vowed on Wednesday not to be the first nation to violate the Iran nuclear deal and said it did not expect the United States to abandon it despite President Donald Trump’s fierce criticism. Trump, who on Tuesday called the 2015 international accord “an embarrassment,” said he had made up his mind whether to keep the pact but declined to disclose his decision. Speaking at the U.N. General Assembly of world leaders, Iranian President Hassan Rouhani responded forcefully to Trump’s pugnacious speech on Tuesday by saying Iran would not be pushed around by a relative newcomer to the world stage. But he also said Iran desired to preserve its accord with six world powers under which Tehran agreed to restrict its nuclear program for at least a decade in return for the loosening of economic sanctions that crippled its economy. “The Islamic Republic of Iran […]

Is Big Oil Going Green?

Oil supermajors rank among the biggest polluters in the world—a hardly surprising fact. In recent years, however, Big Oil has reduced its greenhouse gas emissions, in what may come as a surprising fact about the dirtiest industry globally. The world’s five largest oil firms—ExxonMobil, Chevron, Royal Dutch Shell, BP, and Total—cut their combined emissions by 13 percent, starting from 2010 and ending in 2015, the latest year with available comprehensive data, a report by Bloomberg New Energy Finance (BNEF) released this week showed. BP cut its pollution the most, by 25.5 percent, while the largest polluter among listed companies—Exxon—reduced its emissions by 14 percent. The oil supermajors—excluding Chevron, which only started reporting emissions in 2012—reduced their combined greenhouse gas emissions by 56.7 million tons between 2010 and 2015, according to the BNEF report. The emissions reduction this decade is in stark contrast with the trends in previous decades, when […]

IEA: Price Spike Coming In 2020

21 Sep 2017   Prices

The oil market has been awash in crude for more than three years, and OPEC has struggled to accelerate the rebalancing effort, but the world could be heading for a supply crunch in a few years due to the sharp fall in industry spending. The halving of oil prices from $100 per barrel before 2014 down to just $50 today has led to a corresponding plunge in upstream investment. But even as benchmark prices seem to have stabilized over the past year, with most analysts predicting gradual and modest gains in the year ahead (depending on OPEC’s actions), there’s still no sign of a serious rebound in spending levels. The problem of a shortage of supply seems very far off today, given the swift turnaround in U.S. shale and persistently high levels of crude storage. But demand continues to rise—the IEA just upgraded its demand growth estimate for 2017 […]

OPEC Has Success at Last, But Oil Revival May Be Short-Lived

21 Sep 2017   OPEC, Prices

When OPEC and its allies gather this week, they’ll have the best evidence yet that their efforts to clear a global oil glut are succeeding. It may prove short-lived. Crude prices have rebounded to a three-month high and the world’s bloated fuel inventories are shrinking, signaling that nine months of production cuts by the alliance of the Organization of Petroleum Exporting Countries and nations including Russia are at last paying off. Yet as U.S. shale oil continues to thrive and seasonal demand wanes, the surplus that has weighed on markets for three years looks set to come back. “The strategy finally has a window of opportunity in which it can work,” said Ed Morse, head of commodities research […]

Thirst for oil returns in wealthy nations

A decade’s worth of efforts to cut oil consumption in industrialized countries is at risk of being reversed, as low fuel prices boost demand and send motorists flocking back to larger gas-guzzling cars. Figures from the International Energy Agency and other forecasters show OECD oil demand, which declined between 2005 and 2014, has been growing rapidly for the last three years after oil prices crashed from above $100 a barrel to about $55 today. If the trend continues, roughly 62 per cent of the reduction in OECD oil consumption since 2008 will have been reversed by the end of next year, despite governments targeting fuel efficiency, alleviating air pollution and cutting reliance on foreign crude. Robust oil use in the developed world, which for years had been expected to decline, just as emerging markets consume more, has cast uncertainty around when global demand will peak. Some energy companies, including Royal Dutch Shell, had warned this could happen as soon as next decade. “This period of lower oil prices has slowed the energy transition, no doubt about it,” said Cuneyt Kazokoglu, head of oil demand at energy consultancy FGE.

Nigerian fuel truck drivers start strike; shortages feared

21 Sep 2017   Nigeria

Nigerian fuel truck drivers have begun a strike, their union said Wednesday, triggering fears of a fresh shortage of oil products.  In addition to seeking a pay rise and a better welfare package, the drivers are protesting the government’s neglect of the roads. The spokesman for the drivers’ unit of the blue collar oil workers’ union Nupeng, Tokunbo Korodo told S&P Global Platts on Wednesday that while the bad state of most Nigerian roads had claimed the lives of many drivers in accidents, employers have refused to increase drivers’ wages.  “In compliance with the directive by the national executive of Nupeng, drivers have been directed to stop [fuel] loading at the depots across the country,” Korodo said.

Chevron drills oil well in Iraqi Kurdish area after two-year gap: sources

21 Sep 2017   Iraq, USA

U.S. firm Chevron drilled its first exploration well this month in Iraqi Kurdistan after a two-year break, industry sources said, signaling its confidence in the area despite an international row over region’s independence referendum plan. Chevron, the second-largest U.S. oil and gas company, drilled the well in Sarta block, north of the regional capital Erbil, the first such well since the second half of 2015, two industry sources told Reuters. “Chevron continues its exploration activities in the Kurdistan Region of Iraq,” a Chevron spokeswoman said, without elaborating. Chevron holds an 80 percent interest in the Sarta and Qara Dagh blocks, which cover a combined area of 279,000 acres (1,129 sq km), according to its 2016 annual report. It does not currently have any production […]

Russia becomes Iraq Kurds’ top funder, quiet about independence vote

21 Sep 2017   Iraq, Russia

Russia, the only major power that has not called on Iraq’s Kurds to cancel a referendum on independence next week, has swiftly become the top funder of Kurdish oil and gas deals, with as much as $4 billion pledged in less than a year, industry sources say. Washington, European countries, Turkey and Iran have all lined up to oppose a move by Iraq’s Kurds to hold a Sept. 25 independence referendum, which the Kurds consider the culmination of decades of struggle for a state of their own, but Iraq calls a violation of its constitution. This week, the White House issued a statement calling the planned vote “provocative and destabilizing”, noting that it will take place not only within the autonomous Kurdish region itself but on territory that is disputed. But Moscow has issued no such call to cancel the vote. Instead, with the planned referendum […]

Russia’s Kurdish Pipeline Gamble

21 Sep 2017   Iraq, Russia

Rarely does one see such a multi-faceted move as Rosneft declaring it will build a $1 billion pipeline bringing gas from Iraqi Kurdistan to Turkey. The 30 BCm/year pipeline would not only allow the ever-expanding Rosneft to fortify its position in Kurdistan and nip into the Turkish gas market, but it could also challenge the export monopolist Gazprom, as the heavy lobbying effort to liberalize access to gas exports failed on the domestic market, it seems it might work out in Turkey. Rosneft-Kurdistan relations intensify by the minute. In February, the sides concluded an oil supply agreement. In July they signed a framework agreement. And in mid-September they formalized their commitment to build the Kurdistan-Turkey gas pipeline. The deal creates a win-win situation for both Rosneft and the KRG government, yet is fraught with serious geopolitical consequences in a region where war remains the prevailing theme of the 21 […]

Saudi Aramco May Unveil Financials In Early 2018

21 Sep 2017   Saudi Arabia

If Saudi authorities decide this year which foreign stock market will be the venue of what would be the biggest IPO in history, and if the government finalizes energy subsidy reforms, Saudi Aramco may be ready to disclose its audited financial figures in early 2018, Reuters reports , citing three sources. If so, it would be the first time that the world is privy to Aramco financials. Saudi authorities have been hoping for a US$2-trillion valuation of the company, and have plans to sell a 5 percent of that $2-trillion pie by the end of next year to fetch roughly US$100 billion for funding the Vision 2030 program to diversify away from oil. Many outside observers and analysts think that this target valuation is too high. “Aramco will have its 2017 results by the first quarter, the audited accounts will be available then, so the IPO could happen after […]

New offensive aims to retake western Anbar

21 Sep 2017   Iraq

Iraqi security forces are launching an offensive to dislodge the self-proclaimed Islamic State (IS) from the western part of Anbar province – the largest remaining swath of Iraqi territory controlled by the militant group, which includes the Akkas gas field. In parallel actions this week, Iraqi troops swept up along the Syrian border to retake the town of Akashat, partially sealing off a western flank. Then, forces began advancing from the east toward the IS-occupied district of Ana.

Oil Traders Empty Key Crude Storage Hub

21 Sep 2017   South Africa

Companies said to be selling crude from Saldanha Bay in Africa Brent crude time-structure strengthens, encouraging sales Oil traders are emptying one of the world’s largest crude storage facilities, located near the southernmost tip of Africa, as the physical market tightens amid booming demand and OPEC production cuts. Total SA , Vitol Group and Mercuria Energy Group Ltd. are selling crude they hoarded in Saldanha Bay, South Africa, during the 2015-2016 glut when the market effectively paid traders to store oil, according to people familiar with the matter, who asked not to be named discussing private operations. Crude demand is now seasonally outstripping supply, tightening the physical market for some crude varieties to levels not seen in the last two years and encouraging traders to sell their stored oil. Learn More “The market is selling inventories from everywhere,” Mercuria Chief Executive Officer Marco Dunand said in an interview in […]

Summary of Weekly Petroleum Data for the Week Ending September 15, 2017

21 Sep 2017   USA

U.S. crude oil refinery inputs averaged about 15.2 million barrels per day during the week ending September 15, 2017, 1.1 million barrels per day more than the previous week’s average. Refineries operated at 83.2% of their operable capacity last week. Gasoline production decreased last week, averaging 9.8 million barrels per day. Distillate fuel production increased last week, averaging over 4.5 million barrels per day. U.S. crude oil imports averaged about 7.4 million barrels per day last week, up by 888,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged 7.2 million barrels per day, 10.9% below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 687,000 barrels per day. Distillate fuel imports averaged 85,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum […]

Will The White House Prevent Rosneft From Buying Citgo?

21 Sep 2017   Russia, USA, Venezuela

Senators have pressed the Trump Administration to review the chances of Russia’s Rosneft acquiring Venezuela’s PDVSA and its U.S. business, Citgo. Marco Rubio and Bob Menendez believe a change in the ownership of Citgo’s assets would constitute a security risk, Reuters reported . In a letter to Treasury Secretary Steven Mnuchin, the Republican and Democratic senators wrote that “ Given Venezuela’s increasingly dire economic and humanitarian situation, we are seriously concerned with a possible acquisition by Rosneft of PDVSA and Citgo .” Mnuchin is the chair of the Committee on Foreign Investment in the United States. The CFIUS is responsible for studying the national security implications of potential foreign acquisitions in the country. The possibility of Russia’s biggest oil company taking over Citgo first surfaced early this year, as PDVSA’s troubles with falling production and lower oil revenues deepened, bringing it closer to a default on pending debts. Rosneft […]

EIA Report Kills Bullish Sentiment

21 Sep 2017   Oil Supply, USA

Amid restarting refineries along the Gulf Coast and growing optimism about strengthening demand, the EIA dampened spirits somewhat by reporting a substantial increase in crude oil inventories for the week to September 15. These, according to the authority, stood at 472.8 million barrels as of last Friday, up by 4.6 million barrels from the previous week, which saw a 5.9-million-barrel increase. S&P Platts said at the start of this week that analysts it polled had forecast a 2.4-million-barrel build in crude oil stockpiles, with the agency warning this would pressure prices, along with a surge in oil imports. The oil futures editor of the service noted that “U.S. inventory data will reflect post-Hurricane Harvey adjustments for another few weeks, at a minimum, as Gulf Coast refiners, terminals and ports continue the process of returning to normal.” The American Petroleum Institute had estimated crude inventories to September 15 to have […]

Has The EIA Been Overestimating Oil Production?

21 Sep 2017   Oil Supply, USA

The Energy Information Administration is overestimating U.S. crude oil production, Continental Resource’s chief executive Harold Hamm said today in an interview with Fox Business. Hamm was notably the only shale oil major executive who warned against the too-quick boosting of shale oil production after the OPEC-non-OPEC output cut deal from the end of last year. “EIA over-forecast what U.S. production was going to be this year by about 100 percent,” Hamm said, adding that the EIA has been revising its production estimates down but by a much more moderate rate than the actual decline in production. And 100 percent too much is a fairly large number, and the market was only too happy to see at least a small adjustment, which was made in the EIA’s latest Short Term Energy Outlook (STEO). According to Hamm, the EIA “made an adjustment of 130,000 barrels down” to compensate. “We are showing […]

Harvey makes landfall in Texas, but drilling returns remain strong

21 Sep 2017   Shale Oil

Despite devastating weather that sent energy market participants into a frenzy, the average of the 12-month forward curve for WTI remained flat month on month at $50.43/b. However, internal rates of return (IRR) increased across the board due in large part to higher natural gas liquids (NGLs) prices. More than three weeks ago, Hurricane Harvey hit the US Gulf Coast with an estimated 51 inches of rain near Mt. Belvieu, Texas, a prominent US NGL price hub. As a result, the entire midstream sector was forced to respond, sending liquids prices higher. While we typically think of the Permian and Eagle Ford basins as oil plays, there are a fair amount of NGLs produced as well. A typical well in both the Permian and Eagle Ford has an NGL composition of around 25%, and with higher liquids prices, returns in each play have benefited. IRRs in the Permian Delaware […]

Platts plans to publish U.S. crude prices in Asia as imports rise

21 Sep 2017   Prices, USA

Oil pricing agency S&P Global Platts said on Thursday it planned to publish U.S. crude prices during the Asia market close from December after U.S. exports to the region rose. Platts’ move comes a year after rival price reporting agency Argus launched two Asia-delivered price indexes for U.S. crude as they compete to be the benchmark for oil flows on the trade route that has opened up after Washington lifted a decades-old ban on crude exports at the end of 2015. About a third of the United States’ crude exports, or more than 56 million barrels, landed in Asia in the first half of 2017, Platts said in a note on its website. Platts said it plans to […]

California cities sue big oil firms over climate change

California cities San Francisco and Oakland filed separate lawsuits against five oil companies on Wednesday seeking billions of dollars to protect against rising sea levels they blamed on climate change, according to public documents. The lawsuits, filed in state courts in San Francisco and Alameda Counties, alleged Chevron, ConocoPhillips, Exxon Mobil, BP, and Royal Dutch Shell, created a public nuisance and asked for funds to finance infrastructure to deal with rising sea levels. According to a press release by San Francisco city officials, the lawsuits mirror 1980s-era lawsuits against tobacco companies. They allege the oil giants “knowingly and recklessly created an ongoing public nuisance that is causing harm now and in the future risks catastrophic harm to human life and property.” “Chevron […]

Russian oil company says it sent the U.S. its largest ever oil shipment

21 Sep 2017   Russia, USA

In its largest maritime shipment to date, a Russian oil company said it dispatched nearly 2 million barrels of oil from an Iraqi oil field to the United States. Russian oil company Gazprom Neft , which operates the Badra field in southern Iraq, said the 1.78 million barrels dispatched to the United States on the New Solution tanker represents the largest maritime shipment ever to a foreign country from its Iraqi subsidiary. The company said it was, however, the second batch of oil from the Iraqi field sent to the United States, but this was the largest. The 12 shipments before these were sent to European and Asia-Pacific markets. The U.S. balance between supply and demand […]

Russia’s Lukoil Eyes Decade Of Oil Output Growth

21 Sep 2017   Oil Supply, Russia

Lukoil expects its output to rise over the next 8-10 years as it brings new fields onstream, vice president and co-owner Leonid Fedun says. MOSCOW, Sept 20 Sept (Reuters) – Russia’s second-largest oil producer Lukoil expects its output to rise over the next 8-10 years as it brings new fields onstream, vice president and co-owner Leonid Fedun said on Wednesday. Lukoil has suffered from sluggish production as its fields, located mostly in Western Siberia, are mature and depleted. But it has been focusing on growth in new producing regions, such as the Caspian Sea and other countries, including Iraq. “The 3-year and 10-year company development plan is under deliberation. According to the parameters under consideration, Lukoil’s hydrocarbon production will be on the rise for the next 8-10 years,” Fedun told the Reuters Russia Investment Summit. Fedun, among the first in the Russian oil industry to call for an output […]

Oil set for strongest third quarter since 2004, Iraq hints at OPEC extension

20 Sep 2017   Prices

Oil rose on Wednesday, set for its largest third-quarter gain in 13 years, after the Iraqi oil minister said OPEC and its partners were considering extending or deepening supply cuts to erode an existing global surplus. Brent crude futures rose 29 cents to $55.43 a barrel by 0800 GMT, while U.S. West Texas Intermediate (WTI) crude futures were up 42 cents at $49.90 a barrel. The oil price is on course for a rise of 15.5 percent this quarter, which would make this year’s performance the strongest for the third quarter since 2004. “An improving macro-economic backdrop should spur oil demand growth over the next couple of quarters and if OPEC increases its adherence to production cuts, higher prices will come,” ANZ Research said in a note. “All things being equal, we still expect oil prices to test new highs (for 2017) by the end of […]

Oil Trades in Narrow Range

20 Sep 2017   Prices

Oil prices faltered Tuesday, giving up gains in earlier trading as investors weighed the possibility that OPEC will extend its production cuts again against the prospect of rising U.S. oil output at higher prices. U.S. crude futures fell 43 cents, or 0.86%, to $49.48 a barrel on the New York Mercantile Exchange, after climbing as high as $50.42 in earlier trading. Brent, the global benchmark, fell 34 cents, or 0.61%, to $55.14 a barrel on ICE Futures Europe. “We’re zigzagging in the range,” said Michael Hiley, a trader at LPS Futures. “We failed the highs from last week and are back down into the same range we’ve been in for three days.” Prices were buoyed in earlier trading by a weaker dollar and signals from Iraq’s oil minister that the country could be open to extending OPEC’s production-cut agreement through next year. But analysts and traders say that $50 […]

Oil edges off recent high ahead U.S. stock data, OPEC meet

20 Sep 2017   Prices

Oil prices edged lower on Tuesday, retreating from near-five-month highs in advance of data expected to show a build in U.S. crude inventories as imports resume and refineries were still restarting after recent storm activity. The market, however, remained buoyant ahead of Friday’s meeting between the Organization of the Petroleum Exporting Countries with non-OPEC producers to discuss progress of their 1.8-million barrel per day supply cut deal. OPEC’s second-biggest producer Iraq said that the group was discussing several options for its supply pact, including an extension beyond March and a further output cut. Nigeria and Libya will send representatives to the meeting despite being exempt from the current deal, two OPEC sources said. Rising output from both countries has kept a lid on price gains, prompting suggestions that they could be included in the deal. Brent crude futures LCOc1 were down 45 cents at $55.03 […]

Have Oil Markets Reached A Turning Point?

20 Sep 2017   Prices

Big Oil has been wheelin’ and dealin’ across the globe as geopolitical risks mount, and OPEC delivered a sigh of relief to crude markets with a signal that has brought the bulls out to play. (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) • The EIA projects total world energy consumption will rise by 28 percent between 2015 and 2040, with most growth coming from developing countries. • Non-OECD Asia accounts for nearly two-thirds of the growth, and that category is dominated by China and India. • All major energy sources will see demand rise except for coal. Renewables post the strongest growth rate at 2.3 percent per year. Market Movers • Royal Dutch Shell (NYSE: RDS.A) said it began restarting its Deer Park refinery in Texas on Sunday, a facility that has a capacity of 325,000 bpd. ExxonMobil (NYSE: XOM) could restart most of […]

Aramco Plans to Buy Non-Saudi Crude in Global Trading Expansion

20 Sep 2017   Saudi Arabia

Saudi Aramco plans to expand its trading business by buying and selling non-Saudi crude as the world’s biggest exporter prepares for what could be a record initial public offering. (Bloomberg) — Saudi Aramco plans to expand its trading business by buying and selling non-Saudi crude as the world’s biggest exporter prepares for what could be a record initial public offering. The state-owned company is putting crude marketing and refined-product trading under the same management, according to Ibrahim Al-Buainain, chief executive officer of Saudi Aramco Products Trading Co. The enlarged unit will trade crude that it doesn’t own, helping Saudi Aramco supply refineries more efficiently and make more profit, he said. “We’ll keep selling our own oil as normal, and we want to get into trading third-party crude,” Al-Buainain, who will head the expanded unit, said in an interview in Fujairah in the United Arab Emirates. Aramco, known formally as […]

Could Kurdish Independence Spark An Oil War?

20 Sep 2017   Iraq

As the date of the Kurdish independence referendum approaches, oil industry moguls should be concerned about an oil production war between Iran and headless Iraq. The Kurds are expected to vote on their political status in late September. A vote in the affirmative would mean that Iraq would lose a chunk of its northern areas, which includes the crucial Kirkuk oilfield and its surrounding reserves. The latest news from the election committee shows that the Kurdistan Regional Government (KRG) is doing the most it can to increase international participation in the election. On Monday, authorities announced that they had removed a key requirement for diaspora voters participating in the elections. Kurds participating in the e-voting platform will no longer be required to present a ration card to be able to cast their vote through September 25 th . Iraqis who have been living abroad for several years, even decades, […]

More Kurdish oil possible, Gulf Keystone says

20 Sep 2017   Iraq

There’s enough cash flow to invest in efforts needed to increase the level of crude oil production from the Kurdish north of Iraq, Gulf Keystone Petroleum said. Gulf Keystone, which has headquarters in London, but a portfolio based in northern Iraq, in August reported total average gross production from its Shaikan oil field last year was at the upper range of its guidance. In an update on operations for the first six months of this year, CEO Jón Ferrier said work so far was in line with expectations, with gains likely in the latter half of the year. “Whilst continuing to maintain a rigorous and disciplined approach to its cost base, Gulf Keystone remains […]

Nigeria: Crude Won’t Be an Income Resource in 10 Years – Kachikwu

20 Sep 2017   Prices

The Minister of State for Petroleum Resources, Ibe Kachikwu, says the world is moving away from oil, hence, it will no longer be an income resource in 10 years’ time. Mr. Kachikwu said this in Abuja on Thursday while answering questions on “His Outlook for the Commodity in 2018.” According to him, 2018 looks like a better year for crude in terms of pricing but countries are focusing on alternative energy. He said, “Everything all added up together is showing us that towards the last quarter of 2018 we expect a better market. Does that better market translate to your 100 dollars price (per barrel)? “Never! I don’t see it, frankly I don’t see it. It’s going to take a major calamity. Largely because on the back of all these, countries are racing away from oil. “If Europe is saying in five years time, ‘we are going to exit […]

China’s Electric Vehicles Run on Coal! Yes, But …

20 Sep 2017   China, Electric Cars

China’s offhand bombshell about potentially consigning gasoline-fueled cars to the scrapheap has met, predictably, with a round of cheers and jeers . This is about one of the latter, which concerns the chart below: With coal dominating China’s electricity generation, a common refrain about electric vehicles is: What’s the point? A car fed by a wire stretching back to a coalmine doesn’t seem like much of an improvement over a gasoline pump. It’s a legitimate point. But it risks obscuring a different, more fundamental point. The question here is whether or not an electric vehicle truly results in less greenhouse-gas emissions than a traditional one with an internal combustion engine. This doesn’t just encompass how the vehicles use their energy, but also where that energy comes from and how the vehicles get built in the first place — what are sometimes called “life-cycle” emissions. The math around emissions of […]

Venezuela’s Crisis Deepens As Hurricane Approaches | OilPrice.com

20 Sep 2017   Venezuela

Oil traders have started to divert fuel shipments from their original destination in Venezuela as Hurricane Maria approaches the Caribbean, Reuters vessel tracking data has shown. Yet the hurricane, which moves at speeds of up to 125 mph, is not the only reason Venezuela’s waters are quickly emptying of tankers. The state oil firm, PDVSA, cannot pay for the cargoes that have already been delivered.  But sitting potentially indefinitely in tumultuous waters is now no longer an option, and in a bid to place these before the hurricane reaches the Venezuelan coast, traders are rerouting the tankers towards other Latin American and Caribbean ports, to sell the fuel to paying clients. Since September 3, six vessels with a combined load of 1.8 million barrels of diesel and other oil derivatives have been moved from the Venezuelan coast. One of these had been floating in Venezuelan waters since early July and has now been directed to Trinidad. Another, loaded with fuel from Europe, set sail back to the continent, Reuters said.  Hurricane season has been most unkind this year. After Harvey, oil terminals in the Caribbean have been operating intermittently, as more hurricanes followed, notably Irma and Jose. The affected region, according to Reuters, imports some 2.5 million bpd of oil products, the bulk coming from the U.S. Gulf Coast. These imports will likely be disrupted further as Maria approaches.

U.S. natural gas prices rise as winter stocks look tight

U.S. natural gas stocks look somewhat tight after low prices this summer worked off the excess stocks that built up in the first half of the year. Current stocks are in line with the five-year seasonal average but that may not be enough given the increase in exports and the number of additional combined-cycle power plants that have become operational in 2017. The last two winters have been exceptionally mild; if this winter proves colder, which is likely simply on the basis of probabilities, inventories could come under pressure. To ration power burn this winter the price of gas for delivery at Henry Hub in January 2018 has already risen by 29 cents per million British thermal units or […]

Hurricane-related spike in gas prices ebbing

20 Sep 2017   Prices

The retail price for gasoline is coming off seasonal highs as the U.S. refining sector returns to normal after Hurricanes Harvey and Irma, AAA reports.  The motor club lists a national average price for a gallon of regular unleaded gasoline at the retail level of $2.62, down about 2 percent from last week and the lowest in more than two weeks. Retail prices spiked in early September after Hurricane Harvey forced more than a dozen refineries, including one of the largest in the country, to close down. Demand pressures later increasedwhen Hurricane Irma hit Florida, which upended the market because the state has no refineries of its own.

BP’s Thunder Horse Platform Shut Temporarily On Power Issue

20 Sep 2017   Offshore

BP Plc halted production at its Thunder Horse platform in the U.S. Gulf of Mexico on Monday following a power outage, a company spokesman confirmed on Tuesday. The benchmark for sour crude rallied to its strongest in more than two years on the disruption. BP evacuated its workforce of about 300 people from the facility after the power outage as a precaution, according to the statement. Technical and essential personnel were scheduled to return to the platform on Tuesday. The platform has the ability to produce up to 265,000 barrels of oil a day, and was producing about 180,000 barrels a day as of May. BP’s four operated platforms in the Gulf can produce up to a total of 695,000 barrels of crude a day. Thunder Horse was the company’s largest producing Gulf platform in 2016. Mars Sour Crude traded at up to […]

Far From the Texas Coast, Hurricane Harvey Hits Oil Refiners

20 Sep 2017   Refining

Three weeks after Hurricane Harvey ravaged the massive fuel-making industry along the Texas coast, the region’s recovery from storm damage is starting to disrupt plans for crucial maintenance at refineries thousands of miles away from the flood zones. Harvey knocked out almost one-quarter of U.S. refining capacity in late August, sending gasoline and diesel prices soaring. The storm hit a few weeks before most of the nation’s fuel makers were set to begin seasonal shutdowns. Demand usually slows at this time of year, so it’s a good time to make repairs and install new equipment at plants that typically run all day every day. But at least 13 refineries from Louisiana to Montana with a combined 3.27 million barrels a day have delayed […]

Reducing power diversity will damage US economy: IHS Markit

20 Sep 2017   USA

A diverse energy mix including coal and nuclear power is a key requirement for US electricity generation if the country is to maintain a cost-effective power supply, IHS Markit said Tuesday. The analytical firm warned Tuesday “policy-driven market distortions” are creating a less efficient power supply that could cost the US economy 0.8% of gross domestic product and 1 million jobs. The current diversified nature of the electricity supply lowers production costs by $114 billion a year and cuts retail prices by 27%, IHS Markit said in a report. However, the current direction of investment suggests “some US power systems will have no meaningful contributions from coal or nuclear resources and a smaller contribution from hydroelectric resources.” Article continues below… Platts Megawatt Daily provides you with timely and relevant North American electric power information. This market report is a valuable asset for any player in electric power and will […]

UK oil and gas reserves will expire in 10 years

20 Sep 2017   United Kingdom

The UK’s oil industry could be entering its final decade of production, according to new research. A study of output from offshore fields estimates about 10% of the nation’s original recoverable oil and gas remains. If the predictions are correct, the UK would soon have to import all the oil and gas it needs, scientists have warned. Academics behind the work are now urging the UK Government to use more renewable energy sources, particularly offshore wind and advanced solar energy technologies. Professor Roy Thompson from the University of Edinburgh’s School of GeoSciences, who led the study, said: “The UK urgently needs a bold energy transition plan, instead of trusting to dwindling fossil fuel reserves and possible fracking. “We must act now and drive the necessary shift to a clean economy with integration between energy systems. “There needs to be greater emphasis on renewables, energy storage and improved insulation and […]

LNG facility in Lithuania to open by year’s end

20 Sep 2017   Lithuania

A state-owned port operator in Lithuania said it started work on a reloading station for support for maritime needs for liquefied natural gas. Klaipėdos nafta said it started work on an LNG reloading station after commissioning cargo delivered by a bunkering vessel owned by a subsidiary of Royal Dutch Shell. Bunkering is the ship-to-ship transfer of fuel. With international regulations calling for fewer emissions in the transportation sector, LNG serves a unique niche for maritime transport. Mindaugas Jusius, the managing director for the Lithuanian company, said the commissioning lets it test the entire LNG logistics chain at the Klaipėda seaport on the Baltic Sea, the northernmost port of its kind in Europe. “Such testing of the process for the first […]

French company Total steps into solar energy market

20 Sep 2017   France, Solar

In an announcement ahead of the French president’s speech before the U.N. General Assembly, Total said it took a greater stake in a renewable power company. The French supermajor said Tuesday it made a $284.7 million investment to take an indirect 23 percent stake in renewable power company EREN RE. Total said could eventually take the company over completely within the next five years. “EREN RE’s momentum will allow us to accelerate our growth in solar energy and move us into the wind power market,” Philippe Sauquet, the president in charge of gas, renewables and power for Total, said in a statement . “The agreement with EREN RE is a major step towards our objective of […]

The Single Biggest Player In The Electric Car Market

20 Sep 2017   China, Electric Cars

The announcement by the U.K. and France that they would prohibit the production of diesel and petrol cars by 2040 made for good headlines, but came as little surprise when you consider the pace of change in the automotive industry. China’s announcement last week that it was considering setting a timeline for phasing out traditional fuel cars will likely have a more profound effect on the development of new energy vehicles (NEV), for two reasons. First, China is already the world’s largest car market, producing over 28 million vehicles in 2016, according to the Financial Times. Significant changes in a market of that size causes more than just ripples in the global automotive market. Second, a centrally controlled command economy such as China’s has shown that policies that are robustly pursued by Beijing can achieve rapid change over short time frames. More than any other country in the world, […]

Born to Drive project investigating self-delivering cars

20 Sep 2017   Electric Cars

About 80 million vehicles are produced around the world every year, but the logistics for transport from the factory to the end customer are extensive, costly and completely manual. A new vehicle is moved up to 30 times manually before it reaches the end customer. The Swedish research project Born to Drive has now developed a new software solution that lets the vehicles move themselves. The system was developed by Semcon in collaboration with seven other companies; a prototype is already up and running. We are seeing autonomous technology starting to become a reality in more and more industries. The technology is now ready to move from vision to practical application. The transformation […]

Oil steady on tighter Middle East supplies, as rising U.S. output weighs

19 Sep 2017   Prices

Oil markets held largely steady on Tuesday, even as OPEC producers Saudi Arabia and Iraq pointed to a reduction in supplies in line with efforts to tighten the market and prop up prices. Prices were capped by rising U.S. shale output and fears that another strong hurricane hitting the Caribbean could knock out refineries and disrupt shipping to and from the United States. Brent crude futures LCOc1, the international benchmark for oil prices, were at $55.50 per barrel at 0653 GMT, up 2 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $50.01 per barrel, up 10 cents, or 0.2 percent, from their last settlement. Iraq’s oil minister Jabbar al-Luaibi said on Tuesday that his country’s crude oil production was currently at 4.32 million barrels per day (bpd). That compares to almost 4.5 million bpd in May and June. His […]

Oil Ends Mixed as Investors Pause After Last Week’s Rally

19 Sep 2017   Prices

Oil prices were mixed Monday, with the U.S. benchmark edging up to a seven-week high and the global benchmark falling, as investors paused after last week’s rally. U.S. crude futures for October delivery settled up 2 cents, or 0.04%, at $49.91 a barrel on the New York Mercantile Exchange—their highest settlement since July 31. The more actively traded November contract fell 9 cents to $50.35 a barrel. Brent, the global benchmark, snapped a five session winning streak, falling 14 cents, or 0.25% to $55.48 a barrel. Prices were buoyed last week by data showing tightening supplies. But analysts said investors will need more convincing for the U.S. benchmark to push above the $50 mark and stay there. “I think that we need to see a drumbeat of positive information to drive the market higher,” said Gene McGillian, research manager at Tradition Energy. Hurricane Harvey, which shuttered refineries in Texas, […]

Crude oil prices brush up against apparent ceiling

19 Sep 2017   Prices

Oil prices lose momentum after running their course following hurricanes that upended dynamics in the U.S. energy sector. File photo by Monika Graff/UPI Sept. 18 (UPI) — Emerging analyst sentiment that the upside potential for the recent rally in crude oil prices is limited may be contributing to the drop witnessed early Monday. The price for Brent crude oil, the global benchmark, is up about 4 percent since the end of August, when Hurricane Harvey struck the southern coast of Texas and hit the large concentration of refiners in the region. Most of the ports in Florida that were closed by Hurricane Irma have since reopened, easing supply-side strains for a state that has no refineries of its own for gasoline supplies. As of 11 a.m. EDT, Sunday, there were three refineries still closed because of Hurricane Harvey, representing about 2 percent of total U.S. refining capacity. The lingering […]

IEA Sees Risk of Volatile Oil Prices on Weak Upstream Investment

19 Sep 2017   IEA

Lag in investment raises risk of tightened market: Atkinson IEA failed to foresee ‘technical ingenuity’ of U.S. shale A dearth of new investment in oil production is stoking a risk of tighter crude supply and unstable prices, even as demand growth is expected to slow over the next five years, according to a senior International Energy Agency official. The worldwide cushion of spare production capacity will shrink without further investment in exploration and output, Neil Atkinson, the head of the IEA’s oil markets and industry division, said at a conference in Manama, Bahrain. “There are still not enough signs of investment beginning to return, and that raises the risk of tightening of the market in the next five years and a risk to the stability of oil prices,” he said Sunday. “There is at least a possibility of going back to the situation we had 10 years ago where […]

IEA: Price Spike Coming In 2020

19 Sep 2017   IEA

The oil market has been awash in crude for more than three years, and OPEC has struggled to accelerate the rebalancing effort, but the world could be heading for a supply crunch in a few years due to the sharp fall in industry spending. The halving of oil prices from $100 per barrel before 2014 down to just $50 today has led to a corresponding plunge in upstream investment. But even as benchmark prices seem to have stabilized over the past year, with most analysts predicting gradual and modest gains in the year ahead (depending on OPEC’s actions), there’s still no sign of a serious rebound in spending levels. The problem of a shortage of supply seems very far off today, given the swift turnaround in U.S. shale and persistently high levels of crude storage. But demand continues to rise—the IEA just upgraded its demand growth estimate for 2017 […]

Global Oil Demand is Surging But That’s Still Not Enough to Fix the Oil Market

19 Sep 2017   Prices

The oil industry just can’t seem to snap out of its doldrums this year. Crude remains stubbornly low, which has stalled the industry’s attempts at a recovery. However, while weaker prices have been bad for oil producers, they’ve been great for consumers because it has kept prices for refined products like gasoline down, which is fueling robust demand growth this year. That said, this accelerating demand hasn’t been enough to propel the oil market, due in part because shale drillers have unleashed a gusher of new production. Drilling down into the latest numbers That give and take market was on display this week when the International Energy Agency (IEA) released its monthly commentary. One of the highlights of the report was recent data showing accelerated demand growth. Last quarter, for example, demand grew by 2.3 million barrels per day (Bpd), which is up 2.4% year over year thanks to […]