Middle East

Funding for giant Israeli gas field to be tapped

13 May 2017   Israel

Parties to the development of the Leviathan natural gas field off the coast of Israel said they’re ready to tap into a loan to facilitate momentum. Delek Group, alongside its partners at Avner Oil Exploration Ltd., sanctioned the giant Leviathan gas field in February and secured a loan agreement with dozens of banks, led by J.P. Morgan and HSBC, for about $1.75 billion to finance the project. In a statement Friday, Delek said the partnership aims to make its first withdrawal from the account in the coming days. “The first withdrawal funds shall be used, inter alia, for payment of the payment demands issued by the operator to the partners in the Leviathan project, as well as for the […]

Oman Cut to Junk by S&P as Crude Oil Decline Imperils Finances

13 May 2017   Oman

Credit rating lowered to one notch below investment grade S&P says Oman can’t mitigate risk of volatile export revenue Oman was cut to junk by S&P Global Ratings, which said a drop in crude could hamper exports from the largest Arab oil producer outside OPEC and jeopardize its finances. S&P lowered the Gulf state’s sovereign debt long-term rating to BB+, one level below investment grade, from BBB- and changed the outlook to negative, the New York-based firm said in a statement Friday. “The negative outlook reflects the potential for Oman’s income level to weaken and for its fiscal and external positions to deteriorate,” S&P said in a statement . The slump in oil prices since 2014 has put pressure on the finances of the sultanate, forcing it to join other Gulf countries in tapping international debt markets to plug budget shortfalls. Oman, which has the third-lowest investment grade rating […]

Saudi Reports Quarterly Budget Deficit of 26.2 Billion Riyals

12 May 2017   Saudi Arabia

First quarter revenue rises 72% to 144 billion riyals Revenue from oil more than doubles, non-oil revenue up 1.3% Saudi Arabia reported a first quarter budget deficit of 26.2 billion riyals ($7 billion) as oil revenue surged, the Ministry of Finance said. Revenue for the three months to March rose 72 percent from a year earlier to 144.1 billion riyals, while expenses fell 2.7 percent to 170 billion riyals, the ministry said in a report on Thursday. Oil revenue more than doubled to 112 billion riyals from 52 billion riyals, while non-oil revenue was 1.3 percent higher at 32.1 billion riyals. The Saudi government is shifting to quarterly statements on the economy — having typically reported only annually — to boost transparency as it implements its long-term blueprint for life after oil. Repairing public finances after the drop in crude prices since 2014 is crucial to the plan, which […]

NYSE executives to woo Aramco IPO in upcoming Saudi visit

11 May 2017   Saudi Arabia

A New York Stock Exchange (NYSE) delegation will visit Saudi Arabia in late May to try to lure a listing by state oil giant Saudi Aramco, industry sources familiar with the matter said. The visit will follow a similar trip to Riyadh last month by London Stock Exchange (LSE) CEO Xavier Rolet, as top exchanges around the world vie to win slices of Aramco’s initial public offering, expected to be the largest in history. Aramco plans to list about 5 percent of its shares, mostly on the Saudi stock market, the Tadawul, and the rest likely on one, two or even three international exchanges, industry sources have previously said. Saudi officials have said the IPO, planned […]

Saudi Reports Quarterly Budget Deficit of 26.2 Billion Riyals

11 May 2017   Saudi Arabia

First quarter revenue rises 72% to 144 billion riyals Revenue from oil more than doubles, non-oil revenue up 1.3% Saudi Arabia reported a first quarter budget deficit of 26.2 billion riyals ($7 billion) as oil revenue surged, the Ministry of Finance said. Revenue for the three months to March rose 72 percent from a year earlier to 144.1 billion riyals, while expenses fell 2.7 percent to 170 billion riyals, the ministry said in a report on Thursday. Oil revenue more than doubled to 112 billion riyals from 52 billion riyals, while non-oil revenue was 1.3 percent higher at 32.1 billion riyals. The Saudi government is shifting to quarterly statements on the economy — having typically reported only annually — to boost transparency as it implements its long-term blueprint for life after oil. Repairing public finances after the drop in crude prices since 2014 is crucial to the plan, which […]

Saudis fear Aramco flotation amounts to selling the cash cow

10 May 2017   Saudi Arabia

Saudis often liken Aramco, the kingdom’s state oil company, to a fat cow or productive hen. The company has for decades been the bedrock of the economy and the enabler of the government largesse to which Saudis have grown accustomed. Now its future has become a source of concern as disquiet grows over plans by Mohammed bin Salman, the deputy crown prince, to sell a 5 per cent stake in Aramco. In recent weeks the hashtag “Mohammed has sold the chicken” has been trending on Twitter, as social media has become the platform for an outpouring of discontent. “What showered us in riches and goods has been sold,” said one anonymous post. “What is left for us apart from the unknown, oh Prince? Of course, for us the unknown and the future for you.” The criticism of Prince Mohammed and his plans underlines the challenges the powerful young leader faces as he tries to push through bold reforms intended to overhaul Saudi Arabia’s oil-dependent economy. The initial public offering of Aramco, which would be the world’s biggest IPO, is core to his plans. He hopes to raise $100bn through the sale, which is supposed to take place in 2018. But resistance to his plans, which include painful austerity measures as Riyadh tries to narrow a yawning fiscal deficit and counter the impact of low oil prices, is simmering. This month, the government reversed cuts to civil servants’ benefits, a surprising U-turn in the face of public pressure that included petitions and an online call for street protests.

Saudi to cut June oil supply to Asia as local demand rises:

10 May 2017   Saudi Arabia

Saudi Aramco will reduce oil supplies to Asia by about 7 million barrels in June, a source said on Tuesday, as the oil giant cuts output as part of global supply pact and trims exports to meet rising domestic demand for power during hot summer months. An OPEC-led agreement to cut global oil supplies is currently due to end in June, although Saudi Arabia and other producers in the group of OPEC and non-OPEC states have indicated curbs could be extended to the end of 2017 or beyond. OPEC and other producers are expected to discuss an extension at a meeting on May 25. When OPEC announced the cuts, Saudi Arabia was quick to tell its customers in Europe and the United States that they would receive lower volumes but shielded most of Asia from the cuts. However, summer is a peak period for power demand in the desert […]

Saudi Arabia and Russia Signal Oil-Cuts Extension Into 2018

Prolonging cuts will speed up rebalancing of market: Novak Saudi Minister Al-Falih confident of agreement to extend Saudi Arabia and Russia signaled they could extend production cuts into 2018, doubling down on an effort to eliminate a supply surplus just as its impact on prices wanes. In separate statements just hours apart on Monday, the world’s largest crude producers said publicly for the first time they would consider prolonging their output reductions for longer than the six-month extension widely expected to be agreed at the OPEC meeting on May 25. “We are discussing a number of scenarios and believe extension for a longer period will help speed up market rebalancing” the Russian Energy Minister Alexander Novak said in a statement. Speaking in Kuala Lumpur earlier Monday, his Saudi counterpart Khalid Al-Falih said he was “rather confident the agreement will be extended into the second half of the year and […]

Iran sees oil production growing through multilateral agreements

9 May 2017   Iran

Iran could see its standing among OPEC members and on the global stage stabilize with global production agreements, a national oil company director said. Iran on Monday started Day 2 of a four-day oil and gas conference in Tehran. The oil ministry’s official news website Shana reported there were thousands of exhibitions “from across the globe” on hand to participate. Gholam-Reza Manouchehri, a deputy director at the National Iranian Oil Co., said Iran has signed more than 20 memoranda of understanding with domestic and international oil companies since sanctions pressured eased in response to a multilateral nuclear deal implemented in January 2016. Production through the arrangements could increase and “the boost is aimed at promoting and stabilizing the country’s footing in the […]

Iraq exports steady in April

9 May 2017   Iraq

Iraq’s April oil export levels were virtually unchanged compared to March, providing another indicator that the Oil Ministry is not planning further production cuts as several oil producing countries attempt to prop up the slumping oil price.The federal government sold 3.252 million barrels per day (bpd) in April, compared with 3.259 million bpd in March, according to the Oil Ministry. Iraqi oil sold by the federal government averaged $47.188 per barrel in March and $47.275 per barrel in Apr…

Saudi Arabia Says Oil Curbs Could Extend Beyond End of 2017

8 May 2017   OPEC, Saudi Arabia

Producer group determined to reach goal of reducing stockpiles U.S. shale output has slowed impact of OPEC’s production curbs Saudi Arabia’s oil minister said he’s confident that an agreement by producers to curb crude output and shrink a market glut will be extended into the second half of the year and possibly beyond. While U.S. shale output growth and the shutdown of refineries for maintenance have slowed the impact of cuts by OPEC and its partners, producers are determined to reach their goal of reducing bloated stockpiles, Khalid Al-Falih said at the Asia Oil and Gas Conference in Kuala Lumpur on Monday. He said he’s confident the global oil market will soon rebalance and return to a “healthy state.” Surging U.S. production has raised concern the Organization of Petroleum Exporting Countries and partners are failing to reduce an oversupply and prop up prices. Oil has surrendered all its gains […]

Saudi oil minister Falih confident output cut deal will be extended by 6 months

8 May 2017   OPEC, Saudi Arabia

Saudi energy minister Khalid al-Falih said Monday at an industry conference in Kuala Lumpur that he was confident that the crude oil output cut deal will be extended by six months or more as the market was moving towards rebalancing. “Based on the consultation I have had with participating members, I am rather confident that the agreement will be extended into the second half of the year and possibly beyond and that includes consultations I have had this morning with the Malaysian prime minister,” Falih said during the opening address at the 19th ASIA Oil and Gas Conference in Kuala Lumpur. The producer coalition is determined to do “whatever it takes to achieve our targets and bringing stock levels back to the five-year average.” Falih said he was pleased that OPEC and non-OPEC partners that agreed to the supply cuts are so far exhibiting discipline and adherence to the […]

Iran warns Saudi prince for bringing ‘battle’ to Iran remark

8 May 2017   Iran, Saudi Arabia

Iran’s defense minister on Monday lashed back at Saudi Arabia, slamming the kingdom’s deputy crown prince over belligerent comments last week that underscored the deep rivalries between the Sunni and Shiite power. In a wide-ranging interview, Saudi Prince Mohammed bin Salman said there was no space for dialogue with rival Iran due to its Shiite ambitions “to control the Islamic world.” Framing the tensions with Iran in sectarian terms, the prince said the Saudis would not sit and wait for war but would “work so that it becomes a battle for them in Iran and not in Saudi Arabia.” On Monday, Iran’s defense minister Gen. Hossein Dehghan was quoted as saying that Iran would advise against “such a stupidity” because in that case, nothing would be “left in Saudi Arabia except Mecca and Medina,” the two holy cities. Dehghan spoke to Al-Manar […]

Iran Will Go Along With What OPEC Decides on Extending Oil Cuts

6 May 2017   Iran

Oil exports now at about 2.5 million barrels a day: Zanganeh Oil minister says he expects oil to trade at $55 a barrel Iran will go along with whatever decision OPEC makes at its meeting later this month on whether to extend oil production cuts beyond June, Oil Minister Bijan Namdar Zanganeh said. “All indications are that the members want a renewal of the deal and we will go along with what they agree upon,” Zanganeh said Saturday on the sidelines of an energy trade show in Tehran. Producers outside OPEC that joined the oil pact will probably agree to keep the cuts for longer, he said. Crude has surrendered all of its gains since the Organization of Petroleum Exporting Countries agreed in November to cut output. Brent crude, the global benchmark, slumped to a five-month low of $46.64 a barrel in New York on Friday, bringing prices down […]

More oil activity expected in Kurdish Iraq, DNO says

5 May 2017   Iraq

First quarter results mean current market conditions support a doubling of the amount of activity in Kurdish oil fields, a Norwegian energy company said. Norwegian oil and gas company DNO said first quarter results showed a profit of $15 million, against a $31 million loss in the previous term. Revenues were up 83 percent. As a result, the company said it was expanding its investment program for the year, “including doubling of planned 2017 wells at the Tawke field in the Kurdistan region of Iraq.” The company said it plans eight new production wells in its flagship assets in the Kurdish north of Iraq, which is under threat, but largely isolated from regional conflict attributed to […]

Iran To Raise Oil Output At Oil Field It Shares With Saudi Arabia

5 May 2017   Iran

The Iranian Offshore Oil Company will increase production at the Foroozan oil field, which Iran shares with Saudi Arabia, by 12,000 barrels daily, the company’s executive director told Iranian media, adding that it will install two platforms at the field soon. Iran has 11 percent of the field—which Saudi Arabia calls Marjan—whose reserves are estimated at 2.3 billion barrels. Besides it, Iran and Saudi Arabia also share another two fields in the Persian Gulf, Lulu and Dorra, respectively Esfandiyar and Arash on the Iranian side. The ramp-up is part of Iran’s efforts to boost its crude oil and natural gas production as soon as possible, challenging the market shares of other OPEC producers in the region, most notably Saudi Arabia. Still, the country is cutting exports after it cleared out what was in storage before economic sanctions were removed and the market share challenge may subside. Iran’s crude oil […]

Saudi Power Struggle Could Destabilize The Entire Middle East

4 May 2017   Saudi Arabia

Political instability in Saudi Arabia is growing as King Salman bin Abdulaziz begins to overhaul the Saudi government, putting a long list of family members into positions of influence while increasing the power of his son, Deputy Crown Prince Mohammad bin Salman. These actions have the potential to lead to a direct conflict with Crown Prince Mohammed bin Nayef. The expected internal power collision, predicted by many analysts, finally seems to be heating up. The real surprise, however, is that it is taking place while King Salman is still alive rather than during the succession period. King Salman’s royal decrees, in which he has appointed two of his other sons, Prince Abdulaziz and Prince Khaled as Minister of State for Energy Affairs and Ambassador to the United States respectively, has opened up Pandora’s box. At the same time, King Salman has decided to re-establish all allowances and benefits which […]

Saudis To Retain Full Control Over Aramco’s Oil After IPO

4 May 2017   Saudi Arabia

Saudi Arabia will continue to have full control over the oil wells and production of Aramco, after the much-anticipated initial public offering of around 5 percent of the Saudi oil giant next year, Deputy Crown Prince Mohammed bin Salman said on Tuesday. “The wells will still be owned by the government. The company only has the right to benefit from the wells. This is the same as before and there are no changes to that,” said the prince on state television, as quoted by Bloomberg . As for production levels, they will continue to be subject to the OPEC policies and global supply and demand, the prince noted. According to Financial Times , Mohammed bin Salman said on Saudi television that “production is not a political decision, it is an economic one set by supply and demand.” The prince also described the local Saudi criticism to the IPO plan […]

Assassins kill North Gas Company deputy DG

3 May 2017   Iraq

Masked gunmen assassinated the deputy director general of the state-run North Gas Company (NGC) Tuesday morning in Kirkuk.Iraq’s northern oil sector has been buffeted by violence in recent years, due to attacks by militants from the self-proclaimed Islamic State (IS) group, friction between rival political factions, and mafia-style violence.Tuesday’s incident echoes a series of assassinations in 2015 that targeted senior Kirkuk-based oil officials.Mohammed Younis Salih Kali was being…

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Saudi to Keep Full Control of Reserves, Output After Aramco IPO

3 May 2017   Saudi Arabia

Government will still own wells, deputy crown prince says Offering about 5% stake in Aramco’s concession in 2018 Saudi Arabia will retain full ownership of its oil and gas reserves and sole decision-making authority on production levels after Saudi Arabian Oil Co.’s long-awaited initial public offering, Deputy Crown Prince Mohammed bin Salman said in interview Tuesday on state-run television. Aramco, the world’s largest oil-exporting company, holds a concession to pump the kingdom’s oil and gas, and a stake in that venture is what will be sold in the offering of “not far from 5 percent” of its shares in 2018, the prince said. Analysts at Sanford C. Bernstein & Co. and Rystad Energy AS in March said the offering had a potential market value above $1 trillion. “The wells will still be owned by the government,” said the deputy crown prince, the son of King Salman bin Abdulaziz. “The […]

All Eyes On Saudi Arabia As OPEC Begins To Unravel

3 May 2017   OPEC, Saudi Arabia

Has OPEC failed? That’s the question analysts have begun to ask , approaching the group’s next meeting later this month. When the members gather at their headquarters in Vienna, it will likely be to agree on an extension of production cuts in place since January. Those cuts, originally intended to re-balance markets and boost prices, had an initial positive effect but their ultimate impact has been difficult to measure, as inventories have declined only gradually while global oil shipments have increased. New production from outside of OPEC, particularly in the United States, has kept global inventories high. It’s generally believed that OPEC members will recognize the need to extend cuts, with one observer calling it a “ 100 percent ” probability. There is some speculation that Russia, a non-OPEC state whose cooperation is crucial to the overall success of OPEC’s strategy, may prove intransigent when it comes to cutting […]

Aramco Cuts Asia Oil Pricing as Saudis Seen Losing Market Share

2 May 2017   Saudi Arabia

Saudi Arabia lowers pricing for June crude for sale to Asia State-owned Saudi Aramco raises pricing to all other regions Saudi Arabia, the world’s largest crude exporter, cut pricing for June oil exports to Asia as it fights to defend sales in its biggest regional market. The kingdom raised pricing to all other regions. State-owned Saudi Arabian Oil Co. , known as Saudi Aramco , lowered its official pricing for Arab Light crude to Asia by 40 cents to an 85 cent discount to the regional benchmark, it said in an emailed statement, in line with the median estimate in a Bloomberg survey of five refiners and traders in the region. Saudi Arabia has ceded market share to OPEC rivals Iran and Iraq by making deeper cuts in output than it promised under the group’s agreement to curb production. Analysts including Christof Ruehl of Abu Dhabi Investment Authority and […]

Iran’s president leans on economic successes

2 May 2017   Iran

Incumbent Iranian President Hassan Rouhani said easing international sections and addressing a high rate of inflation are priorities for the OPEC member state. “The first major issue needed to be addressed was the nuclear talks and bringing to an end international sanctions against the country,” he said of his first term in office. “The second problem was the rampant inflation rate while the third main problem was propping up production in the country.” A moderate by relative standards, Rouhani is campaigning against rival candidates Mostafa Aqa-Mirsalim, Eshaq Jahangiri, Ebrahim Raeisi, Mohammad- Baqer Qalibaf , and Mostafa Hashemi-Taba in the May 19 election. Under Rouhani’s tenure, Iran brought […]

Saudis Further Discount Crude To Asia

2 May 2017   Saudi Arabia

In a bid to defend its Asian market share amid OPEC’s production cuts, Saudi Arabia is lowering yet again the official selling prices (OSPs) for the crude grades it sells to Asia in June, while pricing for all other regions was raised. Saudi Aramco, the state oil giant, has cut the OSP for its flagship Arab Light crude bound for Asia for June by US$0.40 to an US$0.85-discount to the regional benchmark, Oman/Dubai average, Bloomberg reported on Monday, citing an emailed statement by Aramco. The Saudi oil company is also cutting the pricing of all its crude varieties for Asia for June, including Super Light, Extra Light, Medium, and Heavy, Reuters reports. The biggest change in June over May is for the Super Light, whose OSP was lowered by US$0.70, while the Heavy crude price for Asia was reduced by the smallest amount, US$0.20, according to Reuters figures. A […]

Iran gets positive output cut signals from OPEC, NON-OPEC states

1 May 2017   Iran

Iran’s Oil Minister said on Saturday OPEC and non-OPEC countries had given positive signals for an extension of output cuts, which Tehran would also back. The Organization of the Petroleum Exporting Countries (OPEC)meets in May to discuss oil supply policy. Oil prices fell last week though they closed higher on Friday on growing hope that OPEC might agree to extend production cuts long enough to reduce a global crude glut. “During these last days we received a positive signal from OPEC members and non-OPEC contributors in this agreement for cutting the production for extending this agreement for the second half of 2017,” minister Bijan Zanganeh told reporters. Zanganeh blamed the United States for lack of foreign investment in Iran’s energy sector, citing political pressure on international oil companies. “They (U.S.) […]

Saudi Arabia may cut June light crude prices to nine-month low

1 May 2017   Saudi Arabia

Top oil exporter Saudi Arabia is expected to cut the price of its flagship Arab Light by 40-50 cents a barrel in June to the lowest in nine months, a survey of Asian refiners showed. Official selling prices (OSPs) are expected to fall across the board for Saudi crudes sold to Asia in June, after a fall in the Middle East benchmark Dubai crude due to ample oil supplies, the survey of five refiners found. “We expect Saudi OSPs to fall as the spot market has collapsed amid oversupply,” an analyst with a North Asian refiner said, adding that the June Arab Light OSP will drop by at least 50 cents a barrel. Reflecting weak demand, the spread for first and third month cash Dubai prices widened in contango in April from […]

Saudi Aramco to boost oil loading capacity with reopened terminal

1 May 2017   Saudi Arabia

Oil tanks seen at the Saudi Aramco headquarters during a media tour at Damam city November 11, 2007. State oil giant Saudi Aramco plans to launch its overhauled Muajjiz oil terminal on the Red Sea next year, lifting its total loading and export capacity to as much as 15 million barrels per day, Saudi officials said. Located on the Red Sea, Muajjiz had been used as an export terminal for Iraqi crude through the Iraqi Pipeline in Saudi Arabia (IPSA), but it has not carried Iraqi crude since Saddam Hussein invaded Kuwait in 1990. The pipeline was confiscated by Saudi Arabia in 2001 as compensation for debts owed by Baghdad. Saudi Arabia had used the IPSA pipeline to transport gas to power plants in the west of the country for years before test opening it in 2012, giving Riyadh scope to export more of its crude should Iran try […]

Iraq says will go with consensus at next OPEC meeting

28 Apr 2017   Iraq

Iraq will go with the consensus reached by OPEC when the oil exporter group meets in Vienna next month to discuss extending production cuts, the country’s oil minister said on Thursday. “Now we’re going on the 25th of May to OPEC and we’re definitely going to be in line with OPEC’s final decision and collective decisions,” Jabar al-Luaibi told a conference in Paris. Iraq, the second-largest producer in the Organization of the Petroleum Exporting Countries, was in full compliance with the OPEC-led supply pact reached last year and has achieved about 97 percent of its output reduction target, Luaibi said. “Iraq is fully committed and Iraq is in full compliance with OPEC members,” Luaibi said. He added that the OPEC-led cuts were […]

Saudi Aramco CEO Says Peak Oil Demand Is a Misleading Theory

Petroleum use will keep growing for decades to come: Nasser World’s largest producer remains on track for IPO next year The boss of Saudi Arabia’s state oil company defended petroleum as the mainstay of the global economy, countering theories that demand will peak within years with his own forecast that consumption will keep growing for decades. “The global economy is forecast to double in size by 2050” so overall demand for energy will be higher, Saudi Arabian Oil Co. Chief Executive Officer Amin Nasser said at the International Oil Summit in Paris. The idea that oil demand is close to its maximum level is “equally as misleading” as now-discredited theories about peak oil supply, he said. Amin Nasser in Paris on April 27. His comments contradict recent opinions from some of the world’s largest oil companies. The surge in battery-powered vehicles will cause demand for oil-based fuels to peak […]

Saudi Forces Foil Attempted Attack on Aramco Oil Product Center

27 Apr 2017   Saudi Arabia

Remote-controlled boat laden with explosives intercepted Saudi Arabia building 400,000 barrels/day refinery in Jazan Saudi Arabia’s security forces foiled an attempt to blow up an oil product distribution center in Jazan, a province bordering Yemen in the kingdom’s southwest, according to the state-run news agency. A remote-controlled boat laden with explosives was spotted leaving a small island in Yemeni waters and later intercepted, the Saudi Press Agency said, citing an unidentified spokesman for the Ministry of Interior. Saudi security forces said they would stop any attacks by Houthi rebels, who are threatening shipping routes in the Red Sea with explosive-laden boats and mines. Saudi Arabia entered the conflict in Yemen in March 2015, leading a coalition that’s carried out intensive airstrikes and deployed a limited number of ground troops in an effort to defeat Shiite Houthi militants aligned with Iran. Since the start of the war, the Houthis have […]

Saudi Arabia Sees 7,000 Jobs Coming From Solar Program by 2020

27 Apr 2017   Saudi Arabia

Three tenders scheduled for 3.45 gigawatts of photovoltaics Aim is to cut domestic use of crude, diesel and fuel oil Saudi Arabia is hoping its solar-power program will generate 7,000 jobs and build a local manufacturing industry that can export products to the world, reducing domestic demand for its crude oil in the process. The Ministry of Energy and Natural Resources requires bidders seeking to build about 3.45 gigawatts of solar and wind plants by 2020 to spend 30 percent of the capital they invest through home-grown workers and companies, said Turki al-Shehri, head of the renewable project development office for the kingdom. “We want to create value,” Al-Shehri said in an interview at the Bloomberg New Energy Finance conference in New York on Tuesday. “We don’t just want to bring in companies that open up manufacturing facilities at a very high premium, which the consumer will end up […]

Saudi Arabia Seen Losing Market Share to Iran, Iraq on Oil Cuts

27 Apr 2017   Saudi Arabia

‘OPEC market share battle hasn’t gone away’: ENBD’s Bell China data for March show Iraq, Iran boosting crude sales Saudi Arabia, the world’s biggest crude exporter, is losing market share to Iraq and Iran as a result of OPEC’s agreement to curb supplies to bolster prices, according to the head of research at Abu Dhabi Investment Authority. “If you’re talking about winners, you can count Iran and Iraq,” Christof Ruehl said Wednesday at a conference in Dubai. The Organization of Petroleum Exporting Countries agreed to production limits for most of its members at a meeting in November and brought 11 other nations on board with the deal in December. Saudi Arabia, OPEC’s biggest producer, agreed to cut output by 486,000 barrels a day while Iraq said it would cut 210,000 barrels a day. Iran was permitted to increase output by 90,000 barrels a day, according to the OPEC accord. […]

OPEC’s No.2 Plans Significant Raise In Crude Output Next Year

26 Apr 2017   Iraq

Iraq has started work on the third and final phase of the Halfaya oil field expansion, with the goal to double production capacity next year, a company official at the state-run firm overseeing fields in the province told Reuters on Tuesday. With more facilities to separate crude oil from associated gas, production capacity at the Halfaya oil field is set to double to 400,000 bpd in 2018, said Adnan Noshi, head of Maysan Oil Co. The Halfaya oil field, operated by PetroChina, is the biggest field that Maysan Oil is overseeing, and is pumping 200,000 bpd. The total production of Maysan Oil is currently 380,000 bpd, Noshi told Reuters. Iraq, OPEC’s second-biggest producer behind Saudi Arabia, plans to boost its crude oil production by 600,000 bpd to 5 million bpd by the end of this year, regardless of its participation in OPEC’s production cut deal. Iraq has been the […]

British company Petrofrac lands $70 million contract in Iraq

26 Apr 2017   Iraq

British energy company Petrofac said Tuesday it scored a multimillion-dollar contract in part to help Iraq expand port facilities for the Persian Gulf. “Over the coming months we will focus on effective deployment of our operations, engineering and projects’ activities across the contracts to enable our clients to unlock maximum value from their oil and gas assets,” Petrofac’s regional managing director, Mani Rajapathy, said in a statement . The British company in December secured a $75 million contract to help with the expansion of a crude oil export facility at a southern Iraqi port at Basra. The Iraqi government is developing the southern export expansion project with the goal of expanding exports capacity from offshore facilities by […]

Aramco Insiders Suggest The Company May Not Be Worth $2 Trillion

26 Apr 2017   Saudi Arabia

As Saudi Arabia’s deputy crown prince, Mohammad bin Salman Al Saud, pushes his nation’s Vision 2030 economic overhaul and crows of the $2 trillion Saudi Aramco valuation (ahead of its potential IPO), WSJ reports that officials at the state-owned oil company are applying internal value estimates of $1.3 to $1.5 trillion to the valuation, calling bin Salman’s estimate “unrealistic and mind blowing.” Since deputy crown prince, Mohammed bin Salman, announced the stock-offering plan and his $2 trillion estimate early last year. Insiders and outsiders have questioned how he arrived at that number. A team of about two dozen employees have been working since last year to try and figure how to take Aramco public while working with Western consultants to explore ways to restructure Aramco in order to maximize its value, say people familiar with the process. The team has determined several variables – what some call “ levers […]

Turkey kills allies in strike on Sinjar

26 Apr 2017   Iraq, Turkey

The bombing raid targeted a PKK affiliate, but KRG Peshmerga were killed. A former IS group hideout occupied by fighters from several PKK-aligned militias west of Sinjar, Nov. 12, 2015. (PATRICK OSGOOD/Iraq Oil Report) Turkish jets bombed several positions on and around Iraq’s Sinjar Mountain overnight Tuesday, killing at least six members of the Kurdistan Regional Government’s (KRG) security forces.The Turkish military said it was targeting an affiliate of the Kurdistan Workers’ Party (PKK), which has waged a decades-long guerrilla war against the Turkish state, although no PKK-backed fighters appear to have been killed in the Sinjar strikes.Neither the Iraqi nor Kurdistan governments said they had a… 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 trial .

Iran sees oil reserve potential growing with new discoveries

25 Apr 2017   Iran

Discoveries in the Persian Gulf of petroleum reserves may boost Iran’s ranks in terms of global capacity, a national director said. Ali Vakili, identified by the Iranian Oil Ministry’s official news agency Shana as a managing director for the Fuel Conservation Co. of Iran, told delegates at a domestic oil and gas conference during the week that Iran’s global position as an energy producer could expand. “A golden triangle of oil deposits has been recently discovered in the Persian Gulf, which will most probably improve the country’s rank in holding oil reserves in the world,” Shana reported . “The official said Iran sits atop the world’s fourth largest oil reserves, which may become even bigger with new discoveries.” The director offered no […]

For Aramco Insiders, Prince’s $2 Trillion IPO Valuation Doesn’t Add Up

25 Apr 2017   Saudi Arabia

Officials at Saudi Arabian Oil Co. have told their superiors there is a hitch in the plans to take the state-owned oil company public: It is likely worth at least $500 billion less than the government previously suggested. The country’s deputy crown prince, who is leading a push to overhaul the economy, has pegged the value of the company known as Saudi Aramco at $2 trillion. But officials working on the deal have struggled to come up with a scenario under which Saudi Aramco is worth more than $1.5 trillion,…

Iraq begins final expansion phase at Halfaya oil field aiming to double output

25 Apr 2017   Iraq

Iraq has launched the third and final phase of work to expand its southern Halfaya oil field, aiming to double its output capacity in 2018 to 400,000 barrels per day, a state-run oil company said. Additional facilities to separate crude oil from associated natural gas will be set up as part of Halfaya’s expansion, Adnan Noshi, head of Maysan Oil Co which oversees oilfields in Maysan province, told Reuters on Tuesday. Halfaya, operated by PetroChina, is Maysan Oil’s largest field, producing 200,000 of the company’s total output of 380,000 bpd, Noshi said. Expansion at Halfaya should raise Maysan’s overall output to nearly 600,000 bpd in 2018, he said. Iraq plans to increase its oil output capacity to 5 million bpd before the end of the year. Output stood at more than 4.7 million […]

Production stops falling as Iraq claims OPEC compliance

25 Apr 2017   Iraq

Iraq’s attempts to reduce oil production appear to have leveled off in March, as senior oil officials said they are fully complying with OPEC cuts.The country produced an estimated 4.586 million bpd in March, according to an analysis of field-by-field data gathered by Iraq Oil Report – a .4 percent increase from the February output levels reported by the Oil Ministry to OPEC.Month-to-month oil export levels also held steady: the Oil Ministry reported 3.259 million bpd of federal oil sale… This content is for registered […]

Space May Be Next Frontier for Earth’s Crude Oil Giants: Analyst

24 Apr 2017   Middle East

Navitas says the Middle East could play space mining role Satellites prospecting asteroids could be launched in 5 years The Middle East has an outsize impact on energy here on Earth. One analyst thinks some regional powerhouses may leverage that role into the development of natural resources in space. Countries like the United Arab Emirates and Saudi Arabia are developing space programs and investing in nascent private space commodity initiatives, said Tom James, a partner at energy consultant Navitas Resources. Doing so could give them a foothold in building extraterrestrial reserves of water — a substance likely to fuel travel within space — and other resources that could be used for in-space manufacturing. “Water is the new oil of space,” James said in Singapore. “Middle East investment in space is growing as it works to shift from an oil-based to a knowledge-based economy.” Prospecting satellites can be built for […]

Oil Majors See Huge Opportunity In Eastern Mediterranean

21 Apr 2017   Cyprus, Israel, Oil Supply

Quite suddenly, there is remarkable oil industry news to come out of the East Mediterranean region. If the plan is executed, in the space of seven years the balance of energy security in Western Europe will be radically changed. In geopolitical terms, this will be immense; when the planned Israel-Cyprus-Greece-Italy gas pipeline is built, European countries will be able to cut their ever-increasing dependence on Russian gas supplies. The story of major gas discoveries in the East Mediterranean started in the shallow-water offshore Egypt, with Miocene Nile Delta discoveries progressively stepping out into deeper and deeper water. The first discovery was made by Phillips Petroleum in 1969, when it drilled the play-opening Abu Qir 1 NFW. It discovered gas in the Messinian Abu Madi sandstones. Subsequent exploration was led by the likes of AMOCO, BG, BP, Eni and Shell. There are now over 100 mainly gas and wet gas […]

Saudi Arabia, Kuwait signal likely extension of oil supply cuts

20 Apr 2017   Kuwait, Saudi Arabia

Leading Gulf oil producers Saudi Arabia and Kuwait gave the clearest signal yet that OPEC plans to extend into the second half of the year a deal with non-OPEC producers to curb oil supplies. Consensus is growing among oil producers that their supply restraint agreement should be extended after its initial six-month term, but there is as yet no agreement, Saudi Energy Minister Khalid al-Falih said on Thursday. “There is consensus building but it’s not done yet,” he told reporters on the sidelines of a conference in the United Arab Emirates. Asked about non-OPEC producer Russia, Falih replied: “We are talking to all countries. We have not reached an agreement for sure, but the consensus is building.” Kuwait’s oil minister Essam al-Marzouq, at the same event, said he expected to […]

Exclusive: China gathers state-led consortium for Aramco IPO – sources

20 Apr 2017   China, Saudi Arabia

China is creating a consortium, including state-owned oil giants and banks and its sovereign wealth fund, that will act as a cornerstone investor in the initial public offering of Saudi Aramco, people with knowledge of the discussions told Reuters. Saudi Aramco, a key exporter to China along with Russia’s Rosneft ( ROSN.MM ), is due to list next year, with a potential $100 billion equity sale that is expected to be the world’s largest to date. The planned Chinese investment makes it more likely that the national energy giant would seek a listing in Asia, with Hong Kong currently the frontrunner among bourses in the region, the same people said. Reuters reported earlier this month that Saudi Aramco’s board would meet in Shanghai in May, its first meeting in […]

Saudi Minister Wants OPEC Oil-Production Deal Extended, Perhaps for Less Than 6 Months

20 Apr 2017   OPEC, Saudi Arabia

An extension to an agreement by members of the Organization of the Petroleum Exporting Countries and producers outside the group to cut crude-oil production is most likely needed, but perhaps not for as long as another six months, Saudi Arabia’s energy minister Khalid al-Falih said Thursday. A preliminary agreement has been reached, though not all OPEC ministers have signed on, Mr. Falih said at an energy-sector event. …

Russia To Help Build 2 Nuclear Power Plants In Iran

20 Apr 2017   Iran, Nuclear, Russia

Russian experts will help the Atomic Energy Organization of Iran build two 1,000-MW nuclear power plants, Iran’s Energy Minister told media. Construction will start soon, Hamid Chitchian also said, adding that a third joint power plant construction project with Russia, which will have a capacity of 1,400 MW, has already begun. The announcement is part of deepening ties between Moscow and Tehran, expanding into a growing number of industries, from oil to defense and fisheries. Earlier this year, Russian Energy Minister Alexander Novak said that Russian companies are “keen” on strengthening their ties with Iran, not least in the power plant construction sector. Energy-hungry Iran plans several more such projects, and it’s likely that Russian companies will be among the preferred bidders. Yesterday, Iran’s ambassador to Russia said in a statement that Tehran would be happy to strengthen bilateral ties further, noting their joint stance on the political situation […]

Iran May Keep Same Oil Output If Others Extend Cuts, Kuwait Says

19 Apr 2017   Iran

Kuwait oil minister says Iran cooperating with OPEC on output Iran’s oil production has stabilized after rising in 2016 Iran will probably be allowed to keep its oil production unchanged if OPEC decides to extend its six-month agreement on output cuts beyond June, Kuwaiti Oil Minister Issam Almarzooq said. “I think they will keep the same level if the deal is extended,” Almarzooq, who chairs the committee monitoring the cuts, said Wednesday in an interview in Abu Dhabi. Kuwait was the first country to call for extending the production cuts beyond June. Oil prices will increase as demand improves, chipping away at oil inventories in the second half, he said. Iran was allowed to increase its output under the deal as the nation rebuilds from international sanctions that crippled its energy industry. Since sanctions were eased in January 2016, Iran’s oil production has climbed 35 percent, according to data […]

Reeling From Low Oil Prices, Saudis Look To Freeze Megaprojects

18 Apr 2017   Prices, Saudi Arabia

Saudi Arabia will start reviewing a number of multi-billion-dollar infrastructure and development project—remnants from a better past when crude oil prices were in three-digit territory. Some of these, according to government sources, will be shelved and others will be restructured. The review is part of urgent reforms prompted by the oil price rout from 2014, which saw Saudi Arabia plunge into a budget deficit for the first time in its history. As part of efforts to reform the oil-reliant economy, last year Deputy Crown Prince Mohammed bin Salman removed from their positions the Kingdom’s long-serving oil and finance ministers, Ali al-Naimi and Ibrahim al-Assaf. At the time, the Finance Minister defended these same megaprojects that will now be scrutinized by the Bureau of Capital and Operational Spending Rationalization, saying that when the investment decisions were made, the economic outlook was very different from where it was in 2016. At […]

Iran Boosts Gas-Output Capacity With New Projects at Giant Field

18 Apr 2017   Iran

Iran boosts output by inaugurating six projects at the giant South Pars offshore field. (Bloomberg) — Iran, holder of the world’s biggest natural gas reserves, boosted output by inaugurating six projects at the giant South Pars offshore field. The country raised total production capacity at South Pars to 570 million cubic meters a day of gas, putting it almost on par with neighboring Qatar, which produces from an adjacent portion of the same deposit, Oil Minister Bijan Namdar Zanganeh said Sunday at a ceremony in the port city of Assaluyeh. Iran invested $20 billion to complete the six projects, or phases, President Hassan Rouhani said at the event. Iran is on track to out-produce Qatar, the world’s biggest exporter of liquefied natural gas, at the Persian Gulf deposit. Iranian officials want to gain market share for gas shipments and attract foreign investment, even as U.S. President Donald Trump ratchets […]

Iran boasts of economic break from oil

18 Apr 2017   Iran

During the first 11 months of the Iranian calendar year, non-oil exports have grown more than 30 percent, state media reported Monday. Ali Khamenei , the ruling cleric in Iran, has called for a so-called resistance economy, one that limits exposure to international market shocks and sanctions pressures in part by weaning itself off oil for revenue. According to the official Islamic Republic News Agency, non-oil exports for the 11 months ending March 20 were up 33 percent. IRNA reported that, under President Hassan Rouhani , there were three unidentified “unfinished” national development plans yet to be started that could contribute to the resistance economy. With more than a dozen candidates, including former President Mahmoud Ahmadinejad , entering the race to challenge Rouhani, the English-language Iran […]