Is A Russian-Iranian Energy Pact In The Making?

21 Mar 2017   Iran, Russia

In the lead-up to President Rouhani’s visit to Moscow, expected to take place in late March , a plethora of news regarding joint Russo-Iranian energy projects has been circulating on the Internet. A three-year long negotiation process regarding a 100,000 barrels-per-day swap contract is believed to be agreed upon, premised on Iran providing Russia (most likely, Rosneft) oil from Kharg Island or other hubs in the Persian Gulf in return for cash and Russian goods that Iran would “require”. Teheran also woos LUKOIL, currently Russia’s only major oil producer in the Caspian, to participate in swap deals bound for Iran’s Neka Port (in return for Iranian crude provided from Kharg Island or other Persian Gulf hubs), albeit on a much smaller scale at 4000 to 5000 barrels per day. To top it all up, numerous Russian oil companies have committed themselves to developing Iran’s hydrocarbon fields. The lifting of […]

Russia enlarges military footprint in Libya

21 Mar 2017   Libya, Russia

Libyan Field Marshall Khalifa Haftar, a fiery commander in eastern Libya, has declared war against radical Islamists, including the Islamic State and al-Qaida, but is controversial for perceived iron-fist tactics. Photo courtesy of Wikipedia TUNIS, March 20 (UPI) — Russia, 19 months after becoming a key player in the Syrian war, is increasing its military presence in Libya and is likely to back Libyan Field Marshal Khalifa Haftar in the tumultuous civil conflict. Haftar, a fiery commander in eastern Libya, has declared war against radical Islamists, including the Islamic State and al-Qaida, but is controversial for perceived iron-fist tactics. In September, Haftar gained control of main oil terminals in the country’s east but lost ground to Islamist forces early this month. While Haftar has received intelligence and security support from France, Britain and the United States, as well as backing from Egypt and the United Arab Emirates, Western countries […]

Oil-rich Russia revises GDP growth estimate higher

21 Mar 2017   Russia

As crude oil prices recover from last year’s historic decline, the Russian finance minister said the outlook for gains in gross domestic product have improved. Russia last year was producing oil at or near post-Soviet highs. According to economists at the Organization of Petroleum Exporting Countries, Russian oil companies were winning out because a decline in the value of the ruble made it economic to produce more oil for more revenue. Finance Minister Anton Siluanov said the ruble was overvalued at the moment. Looking ahead, growth in gross domestic production should settle between 1.5 percent and 2 percent, an improvement from previous estimates. “On the whole we agree that the economy will be growing faster than initially expected,” he was quoted by Russian news agency Tass as […]

Russia to cut oil output by 300,000 bpd by end-April: Energy Minister

18 Mar 2017   Russia

Russia will cut its oil output by 300,000 barrels per day by the end of April and will maintain production at that level until the global oil cuts deal expires at the end of June, Energy minister Alexander Novak said on Friday. Russia had cut output by 160,000 bpd by the middle of March, said Novak, a figure he said would reach 200,000 bpd by the end of the month. Asked if it was expedient to prolong the cuts deal that includes OPEC and non-OPEC oil producers, Novak said: “It’s too early to talk about it in the middle of March, (the matter) should be discussed and a decision should be made at […]

Russia’s Lukoil backs OPEC production cut extension

17 Mar 2017   Russia

It’s reasonable to give serious consideration to extending a production agreement led by OPEC, the head of Russian oil company Lukoil said Thursday. Russia is contributing as a non-member state to an effort steered by the Organization of Petroleum Exporting Countries that aims to correct an oversupplied market through managed production declines. Russian Energy Minister Alexander Novak chaired a joint meeting with OPEC in December that called for voluntary managed declines from non-member states. The terms of the OPEC agreement, which went into force in January, extend for six months, with the option for an extension based on market conditions. Lukoil President Vagit Alekperov said he will look for clarity on the issue when the major producers meet again later this […]

Could Rosneft Take Control Of Citgo?

16 Mar 2017   Russia, USA, Venezuela

Rosneft could take control of 49.9 percent of Citgo – the troubled U.S. business of Venezuela’s state-owned oil company, media are warning. PDVSA used the stake as collateral for a $1.5-billion loan provided by Rosneft last year, and the Russian company immediately filed a lien with the Delaware Department of State asserting its right to ownership in case PDVSA defaults on debt payments. Now, the possibility of a default has become more pronounced, spurring speculation about what might happen should this possibility turn into a certainty. The loan deal itself sparked protests in the U.S. energy industry, with ConocoPhillips and a Canadian miner, Crystallex, asking the federal court in Delaware to cancel the lien, even though the use of stock as collateral in loan agreements is standard practice. This time, however, there are geopolitical implications weighing in, and it’s these implications that will, in all likelihood, make the idea […]

Russia reacts to steep drop in oil prices

15 Mar 2017   Russia

The dramatic drop in crude oil prices is in large part because of “aggressive” output in the United States, but OPEC still factors in, a Russian minister said. Crude oil prices declined 5 percent Wednesday after a federal U.S. report revealed dramatic gains in crude oil storage and production levels. The U.S. shale oil boom that evolved over the last decade put negative pressure on crude oil prices, leading to an ultimate plunge below $30 per barrel last year. That compared with a period three years ago where oil above $100 per barrel was relatively common. Russian Economic Development Minister Maxim Oreshkin was quoted by Russia news agency TASS as saying the resiliency of U.S. shale to lower crude oil prices was putting a ceiling […]

Russian oil major says U.S. shale growth imperils OPEC deal

14 Mar 2017   -, Russia, Shale Oil

A recovery in U.S. oil output may deter OPEC and non-OPEC producers from extending production cuts beyond June and might lead to a new price war, Russia’s top oil major said on Monday. U.S. shale oil production had been in retreat as oil prices tumbled from above $100 a barrel in 2014 to below $30 in 2015, making costly fracking processes less profitable. A deal by the Organization of the Petroleum Exporting Countries with Russia and other producers to rein in output by 1.8 million barrels per day (bpd) for six months from Jan. 1 lifted prices but also encouraged U.S. firms to boost supplies. “It became evident that U.S. shale oil output has become and will remain a new global oil price regulator […]

Saudi Arabia, Russia Offer United Front on Oil Supply Cuts

Saudi Arabia and Russia, the architects of an oil production cut that has stabilized prices, presented a united front on compliance just as rising U.S. inventories have sparked doubts about the OPEC and non-OPEC deal. Khalid Al-Falih, the Saudi energy minister, acknowledged that global crude inventories aren’t draining as quickly as he expected, opening the door for an extension of the production cuts into the second half of the year. The potential rollover is a subtle yet significant shift from just six weeks ago, when the minister said that an extension probably wouldn’t be needed. Al-Falih’s concern about the slow pace of stockpile reductions was echoed by Suhail Al-Mazrouei, the oil minister for the United Arab Emirates. Since the Organization of Petroleum Exporting Countries and some of its rivals, including Russia, agreed to cut output in late 2016, oil prices have stabilized at around $50-$55 a barrel, up from $45-$50 a barrel before. Yet, prices are struggling to rise further as U.S. crude stocks increased to record levels.  With the market starting to believe the cuts were backfiring by reviving U.S. oil production, Al-Falih and his Russian counterpart Alexander Novak called a news conference in Houston after a round of meetings to offer a united front, and insist the cuts will work.


Iran vs Russia: The Next Natural Gas War

Not everybody attending the Iranian natural gas summit last week in Frankfurt was there for the same reason. While most were gauging the prospects for an opening of major natural gas reserves and liquefied natural gas (LNG) export prospects, others were there for quite different reasons. Take the three representatives from Russia’s gas giant Gazprom (OGZPY), for example. They weren’t there to scout new investment packages. On the contrary… They were there to see just how badly their company’s position was under siege. And it’s no wonder the Gazprom guys looked concerned. From what I saw at the summit, they have every reason to be. For energy investors, on the other hand, the news is very good… Gazprom is in Dire Straits Gazprom may still be the largest natural gas company on the face of the Earth, exporting more gas than anybody else and providing revenues that account for […]

Oil Price, Sanctions Weigh on Russian Stocks, Moscow Unfazed

7 Mar 2017   Russia

When Donald Trump won the presidential vote last year there was an outcry from his opponents due to his alleged close ties with the Russian government. Many believed that Trump would be quick to remove U.S. economic sanctions against Russia, thus stimulating economic growth in the country and making it more daring territorially. This has not happened and is unlikely to happen, as is becoming increasingly obvious. The sanctions have remained, and so have low oil prices, pressuring Russia’s growth and stock market. These two factors are seen by some analysts as the drivers behind equity price trends in the country. According to CNBC, the Moscow Composite Index, or Micex, is down 8 percent in the past three months, underperforming the U.S. stock market by 15 percent, thanks to Trump’s vow to keep sanctions in place and, of course, the new lower normal for oil prices. Now, investors are […]

IHS CERAWeek: Russia to achieve 300,000 b/d in agreed cut by end April: minister

7 Mar 2017   Russia

Russia will achieve by late April the 300,000 b/d cut it agreed to in the coordinated supply cut agreement reached with OPEC and 11 non-OPEC countries last year, Russian energy minister Alexander Novak told reporters Monday at IHS CERAWeek. Novak said Russia is currently meeting 50% of its supply cut commitment and will likely have cut 200,000 b/d by the end of March. Related IHS CERAWeek story: IEA chief says global oil demand ‘not peaking’ Under the deal, OPEC in November agreed to cut 1.2 million b/d from its October levels while 11 non-OPEC countries led by Russia agreed to cut an additional 558,000 b/d. Novak said it remains unclear if the supply cut deal will be extended beyond June, a decision he said likely will not be made until shortly before the current deal is set to expire. Article continues below… Oilgram News brings you fast-breaking global petroleum […]

Russia Is Running on More Than Just the Black Stuff

7 Mar 2017   Russia

The world’s largest energy producer is out of its longest recession in two decades Russia has exited recession, with a little help from the boys in uniform, a major statistical revision – and the global oil price. And not just any recession, but its longest in two decades. So what happened? 1. Is the economy really out of the woods? Actually, the contraction ended a few quarters earlier than previously estimated, according to revised calculations by the Bank of Russia’s research and forecasting department. The Federal Statistics Office hasn’t released a quarterly growth figure since 2015, so that’s not an official, official number. The central bank had thought that quarterly growth turned positive only in the second half of last year. Now it seems Russia has been in the black since the first quarter of 2016. Part of the reason for that is a reclassification of military spending . […]

Russia Committed to Oil Production Cut

7 Mar 2017   Russia

Russia’s energy minister said Monday the nation is gradually reducing its oil production in line with an agreement reached with OPEC late last year and should be fully compliant by the end of April. The country, which ranks among the world’s top oil producers, agreed to reduce its output by 300,000 barrels a day as part of a broad effort by the Organization of the Petroleum Exporting Countries and other producers to boost…

Russia expects oil and gas revenue to bounce back in March

4 Mar 2017   Russia

After a budget shortfall in February, Russia’s finance minister said the country expected to receive more than $1 billion in oil and natural gas revenue this month. The Russian government said Friday it expected a $1.5 billion windfall in March, after revenues from oil and gas fell short of forecasts for February. “The deviation of actual oil and gas revenue received by the end of February 2017… from estimates a month earlier was [minus] $365 million,” a ministry report states. Russia derives a sizable portion of its revenue from oil and natural gas and is a main energy supplier to European and Asian economies. One day after members of the Organization of Petroleum Exporting Countries agreed to […]

Russian cuts to oil production stall in February

3 Mar 2017   Russia

Russia’s oil output stayed unchanged in February from the previous month, with cuts at just a third of the levels pledged by Moscow under a global deal to reduce production, Energy Ministry data showed on Thursday. The country’s oil and gas condensate output remained at 11.11 million barrels per day (bpd) [O/RUS1] last month, down 100,000 bpd from levels agreed as the starting point for the accord. OPEC and other large producers led by Russia agreed late last year to reduce their total oil output by almost 1.8 million bpd in the first half of 2017 to boost the price of crude, a key source of revenue. Of that, Russia pledged to cut 300,000 bpd, with 200,000 bpd of reductions […]

Russia’s Lukoil reports oil production declines for 2016

3 Mar 2017   Russia

Russian oil producer Lukoil said its oil production for 2016 was 8.6 percent lower than in 2015, but higher for the fourth quarter by about 2.5 percent. Excluding work in Iraq, Lukoil reported the full-year 2016 production of 674 million barrels was a 9 percent decline year-over-year. Fourth quarter production was reported at 162 million barrels, up 2.5 percent from the previous term. Lukoil in a statement said its production from the fourth quarter excluded volumes from the West Qurna-2 project in Iraq. Production there saw dramatic declines both in year-on-year figures and for the fourth quarter. “Oil production dynamics outside of Russia were influenced by the divestment of our share in Caspian Investment Resources Ltd. in Kazakhstan in 2015, as well as a decrease […]

Gazprom Says Europe’s Appetite for Gas Keeps Getting Bigger

Europe’s appetite for natural gas is leading to a growth “renaissance” as its stores of the fuel languish at the lowest levels since 2013, according to Gazprom PJSC. Europe’s appetite for natural gas will probably meet or even exceed last year’s growth as the region needs to replenish its lowest gas storage levels since 2013, according to Gazprom PJSC. A “conservative estimate” by the world’s biggest exporter is that Europe’s demand may increase by about 5 percent this year, Deputy Chief Executive Officer Alexander Medvedev said Thursday in an interview in Hong Kong. The state-run company, which supplied record volumes to Europe last year and met more than a third of consumption, sees its 2017 shipments of “no less than in 2016,” he said. The European Union’s gas demand increased in 2015 after four years of declines. After the coldest January in seven years and plunging output at domestic […]

Putin’s Russia Seen Dominating European Energy for Two Decades

1 Mar 2017   Russia

Europe has wanted to wean itself from Russian natural gas ever since supplies from its eastern neighbor dropped during freezing weather in 2009. Almost a decade later, the region has never been more dependent. Gazprom PJSC, Russia’s state-run export monopoly, shipped a record amount of gas to the European Union last year and accounts for about 34 percent of the trading bloc’s use of the fuel. Russia will remain the biggest source of supply through 2035, Royal Dutch Shell Plc said last week , echoing comments by BP Plc in January. EU lawmakers have had their hearts set on diversifying supplies with liquefied natural gas delivered by tanker from the U.S., where production of the fuel skyrocketed last year. So far, those shipments have failed to materialize amid a lack of firm contracts and higher prices outside Europe. Overall, LNG shipments to the region, led by Qatar, were stagnant […]

Russia sees U.S. oil production as a lid on oil prices

28 Feb 2017   Prices, Russia, Shale Oil

Gains in oil production from the United States should establish a ceiling over crude oil prices on the global market, the head of Russia’s Lukoil said Monday. Russia is coordinating with members of the Organization of Petroleum Exporting Countries on a production arrangement aimed at pulling an over-supplied market for crude oil back to balance. After dropping below $30 per barrel in early 2016, oil prices since OPEC’s agreement surfaced in November have been steady above $50 per barrel. U.S. shale oil production gains helped saturate the markets and output from the Lower 48 states has proved more resilient than expected to crude oil prices that are still about half what they were three […]

Russia says in talks over Iranian oil purchases

27 Feb 2017   Iran, Russia

Russia has been in talks of buying oil from Iran, Energy Minister Alexander Novak said on Monday, confirming earlier reports. At the sidelines of a economic forum in the Black Sea resort of Sochi, Novak told reportes he expected the deal to be reached “within weeks.” The purchases will be carried out via Promsirieimport, a trading unit of Russia’s Energy Ministry, he said. Last week, Iranian Students’ News Agency (ISNA) reported that Iran will begin selling 100,000 bpd of to Russia within the next 15 days and receive payment half in cash and half in goods and services. (Reporting by Olesya Astakhova; writing Vladimir Soldatkin; Editing by Aleksandar Vasovic)

How Russia Is Using Oil Deals To Secure Its Influence In The Middle East

27 Feb 2017   Middle East, Russia

A string of oil deals between Russian oil companies and Arab petrostates have shifted the center of political gravity in the Middle East and North Africa towards Moscow – counteracting the effect of decades of American military and political involvement as U.S. President Donald Trump’s plan for the region remains unclear. The 2014 oil price drop hit the national economy hard, causing the price of the ruble to plummet and GDP growth to grind to a halt. This has pushed Moscow to look outward to project strength as a crippling recession proceeds on the domestic front. The Arab World has been Putin’s favorite arena to grow the Russian sphere of influence. Moroccan King Mohammed VI’s visit to Moscow last year brought the two countries closer together on tourism and counterterrorism issues. But the North African country’s lack of oil or gas resources did not leave room for further discussions […]

Is The Trump Administration About To Rescue The Russian Economy?

24 Feb 2017   Russia, USA

As oil prices continue their slow uphill climb and the global energy community reenters exploration mode, the Russian economy has much to gain from new American leadership that seems lenient on oil sector sanctions. On Tuesday, Representative Charlie Dent from Pennsylvania became the fourth Republican lawmaker to back a bill limiting newly inaugurated President Donald Trump’s ability to pull back sanctions against Russia. The legislation would require Trump to seek congressional approval before reducing or removing the punitive measures that are currently in place to punish Moscow for its support of Syrian President Bashar Al Assad’s murderous regime, the forced annexation of Crimea and now also for organized cyberattacks against American institutions in the months leading up to the 2016 presidential elections. “ In order to modify these imposed sanctions, the President would need to certify to Congress that the government of Russia has stopped the activities that warranted […]

Iran to sign oil contract to sell Russia 100,000 bpd: state TV

22 Feb 2017   Iran, Russia

Iran announced on Tuesday it will begin selling 100,000 barrels of oil a day to Russia within the next 15 days and receive payment half in cash and half in goods and services, the Iranian Students’ News Agency (ISNA) reported. Iranian Oil Minister Bijan Namdar Zanganeh provided details about the deal after meeting Russian energy minister Alexander Novak in Tehran, ISNA said. “Of course we were ready to sign the contract tonight but our Russian counterpart was in a hurry and had to go to the airport,” Zanganeh said. He added that a number of Russian companies have already signed memorandums of understanding with Iranian companies. Zanganeh said that Russia will be cooperating with an OPEC decision last November to cut production levels and will be reducing its oil output by 300,000 bpd, according to ISNA. (Reporting by Babak Dehghanpisheh; Editing by Robin Pomeroy)

Rosneft Expands in Middle East With Libya and Iraq Oil Deals

22 Feb 2017   Iraq, Libya, Russia

Rosneft PJSC , the state-run producer headed by a close adviser of Russian President Vladimir Putin, is expanding its footprint in the Middle East by striking new oil deals with Iraq’s Kurdish region and Libya. Russia’s largest oil producer agreed to buy crude from Libya’s National Oil Corp., the state-run NOC said Tuesday on its website, without specifying the amount. The deal also provides for Rosneft to invest in exploration and production in the North African country. The Russian company announced on the same day it will buy Kurdish oil until 2019 and will study exploration and production opportunities in Kurdish areas, it said in a statement. “These deals combine potentially good economics for Rosneft and good politics for the Kremlin,” Chris Weafer, a partner at Macro Advisory in Moscow, said Tuesday by e-mail. “Expect more deals from Rosneft in the Middle East and North Africa and across the […]

Rosneft signs landmark deal to buy KRG crude

22 Feb 2017   Iraq, Russia

In a sign that Kurdistan’s oil sector is shedding some of its legal and political risk, KRG crude will now supply the refineries of Russia’s largest oil company. A tanker loads crude at the Turkish port of Ceyhan, May 2015. (STAFF/Iraq Oil Report) Kurdistan has signed a three-year crude supply agreement with Russian state oil giant Rosneft, a milestone in the regional government’s efforts to establish an independent oil sector.”It is the first time the KRG has supplied crude directly to a major global oil refiner and reflects the growing confidence of the international oil market in KRG crude,” said a KRG official with knowledge of the deal.The contract is part of a broader cooperation agreement covering upstream, logistics, and … This content is for registered users. Please login to continue. If you are not a registered user, you may purchase a subscription or sign up for a free […]

Russia Overtakes Saudi Arabia as World’s Top Crude Oil Producer

21 Feb 2017   Russia

Russia overtook Saudi Arabia as the world’s largest crude producer in December, when both countries started restricting supplies ahead of agreed cuts with other global producers to curb the worst glut in decades. Russia pumped 10.49 million barrels a day in December, down 29,000 barrels a day from November, while Saudi Arabia’s output declined to 10.46 million barrels a day from 10.72 million barrels a day in November, according to data published Monday on the website of the Joint Organisations Data Initiative in Riyadh. That was the first time Russia beat Saudi Arabia since March. Saudi Arabia and fellow producers from the Organization of Petroleum Exporting Countries decided at the end of November to restrict supplies by 1.2 million barrels a day for six months starting Jan. 1, with Saudi Arabia instrumental in the plan. Non-member producers, including Russia, pledged additional curbs. Brent crude prices have climbed about 20 […]

Russia’s Rosneft starts drilling in Iraq

21 Feb 2017   Iraq, Russia

Russian oil producer Rosneft reported Monday it started new drilling operations in Iraq, alongside a Chinese contracting partner. Rosneft said it started a new exploration well, which according to state news agency Tass should be completed by July. The company is working in the area alongside a Chinese contractor, after taking over the operations in October. Rosneft is Russia’s largest oil producer. For the fourth quarter, the company said its net production was up 11.8 percent year-on-year for a new record high. As one of the largest oil producers outside of the Organization of Petroleum Exporting Countries, Russia is contributing to efforts to balance a market that last year favored the supply side. According to statistics, Russian oil producer Lukoil, one of the country’s largest in terms of net […]

Vladimir Putin: Clear signs of Russian economic growth

18 Feb 2017   Russia

As oil prices stabilize in the wake of an OPEC-led production deal, Russian President Vladimir Putin said signs of economic strength are becoming clear. The president sat with his top economic advisors for the second time this year, saying there are clear signs of positive momentum. By his read , the 0.2 percent decline in gross domestic product last year was better than expected. “The trends are becoming more or less clear, and we have an overall understanding of the ongoing developments,” he said. “Overall, we are seeing positive economic momentum.” The International Monetary Fund said it expected a 0.6 percent contraction for Russia last year, but growth would return at 1.1 percent in 2017. After keeping its key lending rates unchanged […]

Russia’s Largest Oilfield May Be About to Gush Cash Once Again

15 Feb 2017   Russia

Russia’s largest oil field, so far past its prime that it now pumps almost 20 times more water than crude, could be on the verge of gushing profits again for Rosneft PJSC . Samotlor, the 25 billion-barrel giant that bankrolled the Soviet Union for decades, would be the biggest beneficiary of proposals to encourage investment in some of Russia’s oldest and largest reservoirs, where output is plunging. One idea being debated — cutting the extraction tax in half for fields producing a lot of water with the oil — could add as much as 90 billion rubles ($1.57 billion) a year to Rosneft’s earnings, said Alexander Kornilov, an analyst at Aton LLC in Moscow. “It is a super giant field even today after almost 50 years of production, the elephant of elephant fields,” said Ildar Davletshin, an analyst at Renaissance Capital. “There is still a lot of oil left,” […]

Russia to boost Urals exports in first half despite cutting oil output with OPEC

11 Feb 2017   Russia

Russia is set to post higher exports of Urals crude for the first half of this year despite cutting oil production ahead of schedule under a deal with OPEC aimed at boosting prices. After OPEC and non-OPEC producers agreed in early December to curtail oil output jointly, market expectations of lower supplies from Russia led to a rise in Baltic Urals prices at the start of the year to their highest in 15 years. But in late January, Urals differentials embarked on a downward trend as traders saw clearly that Moscow, seeking to plug a hole in its budget, had no plan to cut exports that month or in February. And if experience serves as a guide, Russia is likely to continue raising exports through spring as maintenance at its refineries peaks in April-May. Under the arrangement with the Organization of the Petroleum Exporting Countries aimed at easing a […]

Russia’s economy grows at $40 per barrel oil

11 Feb 2017   Russia

Russia’s Central Bank Gov. Elvira Nabiullina says the economy will grow even if the price of oil moves back toward $40 per barrel. Photo courtesy of the Central Bank of Russia Feb. 9 (UPI) — The Russian economy will be on the positive side of growth even if the price of crude oil falls to $40 per barrel, the Central Bank of Russia said. Central Bank Gov. Elvira Nabiullina said Thursday the Russian economy stands to exhibit growth this year. The number of economic sectors expected to expand this year is not much greater than those in contraction, but losers are outnumbered. Much of the strength depends on the price of crude oil, however. “We will be in the positive zone in any scenario, even with $40 per barrel,” she was quoted by Russian news agency Tass as saying. A November forecast from the International Monetary Fund found the […]

Putin’s Tough Choice: China Or The West

6 Feb 2017   China, Russia

“With Tillerson’s confirmation, Exxon just annexed the United States,” –anonymous blogger. To many observers, the appointment of Tillerson to the helm the State Dept signaled the Administration’s priority of supporting the oil industry, which in recent years has been under severe pressure from OPEC’s campaign of over-production that forced prices down to a post-recession low. Seen from a different angle, the move also signals Exxon, the oil giant, establishing a strong connection with the Administration. As the former CEO of Exxon, and a member of the Board of Directors of the company that was the core of the original Rockefeller Family’s Standard Oil monopoly, Tillerson also brings direct contact with the Rockefeller Family, whose members remain on the Exxon Board. Former Secretary of State, Condaleeza Rice, who also sits on the BoD, along with Former CIA Director and Defense Secretary, Robert Gates, both listed as an Exxon consultant, also […]

Russia could move quicker on oil production declines

3 Feb 2017   Russia

Russia could move quicker than expected on trimming oil production under the terms of an OPEC-led agreement, the country’s energy minister said Thursday. Russia joined other oil producers in an effort from the Organization of Petroleum Exporting Countries to pull markets back into balance after a glut brought crude oil prices to historic lows in early 2016. OPEC agreed to cut a collective 1.2 million barrels per day from its production and non-members agreed to about half that. Russia accounts for the lion’s share of the non-OPEC production cut with 300,000 bpd. Russian Energy Minister Alexander Novak said companies so far have signaled they’ll implement the agreement. “It is possible that they will be [implemented] at a faster pace,” he […]

Russia Claims Global Oil Output Down By 1.4M Bpd

2 Feb 2017   OPEC, Russia

Russian Energy Minister Alexander Novak has announced that global oil output was cut by 1.4 million barrels per day last month, in the aftermath of the deal between OPEC and non-OPEC countries to rebalance the market. Novak made his announcement during a meeting with Russian President Vladimir Putin, referring to preliminary data without explaining the sources of the data. If Novak’s figures are correct, it would mean that OPEC and non-OPEC countries are close to meeting their goal of cutting a combined 1.8 million barrels per day by the first half of this year. At a compliance meeting in Vienna earlier in January, Novak said that Russia had reduced its oil production by some 100,000 barrels a day. Russia intends to cut its oil production by 200,000 barrels per day by the end of the first quarter and afterwards 300,000 barrels per day. “Some countries have cut more than […]

Is The Kremlin Funding A Campaign That Undermines U.S. Fracking?

2 Feb 2017   Russia, Shale Oil

The recent National Intelligence Council report assessing the involvement of Russia in last year’s U.S. presidential elections spurred a flurry of media reports suggesting that Russia is heavily involved in anti-fracking campaigning. Some authors interpreted this involvement as a “ propaganda effort ”, while others claimed the Kremlin was financially backing anti-fracking groups in the U.S., without, however, providing any evidence for this claim. The basis for all these reports is part of the report, in which the authors discuss the agenda of RT, a state-funded TV channel and website that is widely seen as the Kremlin’s chief megaphone abroad. They quote shows and reports that led them to conclude that RT aimed at fueling discontent in the U.S. and influence interior politics. Anti-fracking rhetoric was identified in the report as a major element of RT’s agenda and interpreted by the report’s authors as reflecting Russia’s concern about the […]

Arctic oil production more than doubled, Russia says

31 Jan 2017   Russia

Russian oil company Gazprom Neft said its production from a field in Arctic waters more than doubled from levels reported in 2015. The company said total production from the Prirazlomnaya oil field in the Russian waters above the Arctic Circle totaled 15.7 million barrels for full-year 2016, an increase from the 5.8 million recorded the previous year. Prirazlomnoye is the first and only field in production in the Russian Arctic. Commercial oil production started in late 2013 and the first batch of oil for delivery was sent in April 2014. Advocacy groups like Greenpeace have been critical about oil operations in the extreme climates of the Arctic north, saying an oil spill in the region would be catastrophic and difficult […]

Lukoil Seeks Middle East Oil Projects for Growth as Iran Opens

30 Jan 2017   Iran, Russia

Lukoil PJSC is seeking opportunities for growth in the Middle East as Iran opens more of its oil fields to international partners, according to the Russian energy company’s regional head. The Moscow-based company plans to add output from the region to existing operations in Iraq and Egypt as long as it finds projects with production costs as low as those in Russia, Gati Al-Jebouri, Lukoil’s head of upstream for the Middle East, told reporters in Dubai. “Iran is our target area at the moment,” Al-Jebouri said. Lukoil is in talks with National Iranian Oil Co. , the Persian Gulf country’s state producer, about the Ab Teymour and Mansouri oil fields in western Iran, he said. Al-Jebouri said he hoped the companies could agree on a common development program for the fields in the first half of the year before proceeding to commercial negotiations and a partnership. Iran has outlined […]

Russia’s Lukoil hopes for Iran oilfield development decision this year

30 Jan 2017   Iran, Russia

Lukoil, Russia’s No.2 oil producer, hopes to reach a decision on developing two new oilfields in Iran and wants to expand its operations further in the Middle East this year, a senior executive said on Sunday. Lukoil is talking with the National Iranian Oil Company (NIOC) on taking part in development of the Abe Timur and Mansuri fields in central-western Iran, said Gati al-Jebouri, vice president and head of upstream operations in the Middle East. “We are in active discussions with them with respect to budget cost structure, and subsequently we will start negotiations on contractual terms if the development plans that we proposed are accepted and agreed by the Iranian party,” Jebouri told reporters on Sunday. […]

Potential impacts of US lifting sanctions on Russian oil sector

30 Jan 2017   Russia

US President Donald Trump said Friday ahead of his first conversation with Russian President Vladimir Putin since taking office that it was too soon to know whether to continue US sanctions against Moscow. Trump has promised to take a softer approach to Russian relations than his predecessor, fueling speculation that he could lift the sanctions. “We’ll see what happens,” Trump said during a joint press conference with UK Prime Minister Theresa May. “As far as the sanctions, [it’s] very early to be talking about that.” Trump and Putin are scheduled to speak Saturday. Article continues below… Platts London Oil & Energy Forum February 20, 2017 | May Fair Hotel, London With sessions on the global outlook for crude oil, middle distillates and the light ends markets of gasoline, naphtha and LPG, alongside updates on the evolution of our key benchmark price assessments, the Platts London Oil and Energy Forum […]

U.S. Shale Won’t Pilfer OPEC, Russian Markets, Former Energy Minister Says

28 Jan 2017   Russia, Shale Oil

A former Russian energy minister on Friday dismissed concerns U.S. shale oil companies may try to use production cuts by Russia and nations in the Middle East to swoop in and steal market share, saying the Americans know there are some no-go zones. Igor Yusufov, Russia’s energy minister from 2001 to 2004, said U.S. shale producers wouldn’t attempt to enter core OPEC and Russia markets where prices are too low for them to compete….

Russia Makes A Move On Asian Oil Markets As OPEC Cuts

27 Jan 2017   OPEC, Russia

Oil prices have been struggling to rise beyond the low $50s per barrel. Not helped by news this week that Libya’s production has hit a 3-year high at 715,000 barrels per day — and is expected to rise to 1.25 million b/d by end-2017. And the crude market may have an even bigger problem looming. Russia. New data Monday showed that Russian oil producers achieved a major milestone in 2016. Becoming the largest supplier of crude to energy-hungry China. That came as Russian oil shipments to China rose 24% as compared to 2015 levels — to an average 1.05 million barrels per day for the year. Inching Russia ahead of go-to supplier Saudi Arabia, which saw its exports to China average 1.02 million b/d in 2016. That shift is happening as Saudi producers reportedly reigned in output under the OPEC production cuts agreed in late 2016. A move that […]

How Russia sold its oil jewel – without saying who bought it

25 Jan 2017   Russia

More than a month after Russia announced one of its biggest privatizations since the 1990s, selling a 19.5 percent stake in its giant oil company Rosneft, it still isn’t possible to determine from public records the full identities of those who bought it. The stake was sold for 10.2 billion euros to a Singapore investment vehicle that Rosneft said was a 50/50 joint venture between Qatar and the Swiss oil trading firm Glencore. Unveiling the deal at a televised meeting with Rosneft’s boss Igor Sechin on Dec. 7, President Vladimir Putin called it a sign of international faith in Russia, despite U.S. and EU financial sanctions on Russian firms including Rosneft. “It is the largest privatization deal, the largest sale […]

Russia in full-court press over European gas pipeline

25 Jan 2017   Europe, Pipelines, Russia

European regulators may be standing in the way of their own regional energy security with their stance against a gas pipeline, Russia’s Gazprom said. Viktor Zubkov , the chairman of the board at Russian gas giant Gazprom, said European regulators were needlessly standing in the way of access to the OPAL gas pipeline. “Its capacities had been groundlessly blocked for several years,” he was quoted as saying by Russian news agency Tass. “The relevance of the decision is demonstrated by the fact that already at the beginning of this year Nord Stream was utilized to the greatest possible extent, though previously experts said a pipeline via the Baltics was not needed.” Access to OPAL is necessary if the Russian natural gas company is to […]

Gazprom’s Medvedev dismisses role of US LNG in European natural gas market

25 Jan 2017   LNG, Russia

Russia is the gas supplier of choice for European markets and will remain the most cost-effective and reliable source of gas in Europe, Alexander Medvedev, Gazprom’s deputy CEO, said Tuesday. Speaking at the European Gas Conference in Vienna, Medvedev said US LNG had been a “big hope” for Europe, but that the record flows of Russian gas to Europe in 2016 — almost 180 Bcm — were evidence of Russia’s position as the leading gas supplier to its European partners. “Russia is the only gas supplier that can reliably and flexibly supply gas in any amount. We can supply whatever Europe wants — we have the capacity to supply an additional 150 Bcm/year,” he said. In an apparent reference to US LNG exports starting up in February last year, Medvedev said Europe had chosen Russian gas despite there being newer supply options. “Our clients have a variety of diversification […]

Russia beats Saudi Arabia as China’s top crude oil supplier in 2016

24 Jan 2017   China, Russia

Russia overtook Saudi Arabia in 2016 to became China’s biggest crude oil supplier for the first year ever, customs data showed on Monday, boosted by robust demand from independent Chinese “teapot” refineries. Russian shipments surged nearly a quarter over 2015 to about 1.05 million barrels per day (bpd), the data showed, with Saudi Arabia coming in a close second with 1.02 million bpd, up 0.9 percent in 2016 versus the previous year. China is the world’s second-largest oil buyer and the fastest-growing major importer. While Saudi Arabia counts China’s state oil firms as backbone clients over long-term supply contracts, China’s independent refineries – nicknamed “teapots” due to their smaller processing capacity – saw Russia as a more flexible supplier. For the teapot plants, authorized to import crude oil importers for the first time in late 2015, shipments from Russia’s eastern ports are easier to process, coming in smaller cargo […]

Gazprom Mulls $6 Billion Asset Sales, Dividend Freeze

24 Jan 2017   Russia

Gazprom PJSC, the world’s biggest natural gas producer, is considering asset sales, freezing dividends and increasing its borrowing as export earnings wane, according to its three-year budget. The state-controlled company aims to raise 350 billion rubles (around $6 billion) from asset sales this year, while borrowing may climb to 288 billion rubles and more than double from that level next year, a copy of the document obtained by Bloomberg News show. Dividend payments are forecast at the 2016 level through 2019, according to the plan, approved by the board in December. Despite a rebound in crude oil, which dictates the price for most of Gazprom’s export contracts, the proposed budget shows the company remains under financial pressure as it tries to finance new pipelines to Europe and Asia. Gazprom needs to increase borrowing to “ensure liquidity and cover obligations” at oil prices close to current levels, according to the […]

Russia Locks In on What’s Wrong With Ruble During Oil Frenzy

24 Jan 2017   Russia

Untethering the ruble helped Russia ride out the biggest oil downturn in a generation. But it’s left the world’s biggest energy exporter vulnerable to greater volatility in crude prices as OPEC pushes output cuts . To address that, the Bank of Russia is preparing to wade back into the currency market after an 18-month absence and soak up foreign revenue earned in excess of the $40 oil price assumed in the budget. First Deputy Prime Minister Igor Shuvalov said in an interview last week that currency purchases are possible already at current oil prices. The exchange rate needs to be more “predictable,” Finance Minister Anton Siluanov said on Saturday. “At this stage of economic recovery, Russia would benefit from a stable ruble rather than further potentially excessive appreciation, which could undermine the competitiveness of Russian exporters at the time when the global trade pie seems to be shrinking ,” […]

Why Russia Beat Saudi Arabia As China’s No.1 Oil Supplier

24 Jan 2017   China, Russia

Russia last year overtook Saudi Arabia as China’s biggest supplier of crude oil thanks in large part to increased demand from independent refineries, popularly called teapots. This is what statistics data released today by Beijing’s customs authority show. The average daily amount that Russian companies exported to China in 2016 stood at 1.05 million barrels, up by 25 percent from 2015. Saudi Arabia’s average daily shipments to the world’s second-largest oil consumer were 1.02 million barrels daily in the period, an amount representing a slight 0.9-percent uptick on 2015. Russia is likely to keep its place as top exporter to China this year as well, as long as demand from teapots remains intense: while China’s state oil companies are bound by long-term contracts with Saudi Arabia, the small refineries have taken advantage of more flexible export conditions offered by Russian exporters as well as from the proximity of Russia’s […]

Russia Wrests Crown of Top China Oil Supplier From Saudi Arabia

23 Jan 2017   China, Russia

Russia overtook Saudi Arabia as China’s top oil supplier last year for the first time ever amid the ongoing battle for market share in the world’s biggest energy market. Russia boosted crude supply to the Asian nation by 24 percent from 2015 to 52.5 million metric tons, or 1.05 million barrels per day, according to data released Monday by the General Administration of Customs. The Middle Eastern kingdom became the second-biggest supplier, shipping 51 million tons, or 1.02 million barrels per day, little changed from a year earlier. Russia has been tussling with Saudi Arabia for dominance in the Asian nation amid efforts by oil producers to defend market share during a worldwide glut. Chinese demand has been seen as a key to a sustainable recovery in prices, while benchmark rates are climbing from the worst crash in a generation amid output cuts by major producing nations. China last […]