Middle East

Former Exxon advisor likely to succeed ousted Basra governor

18 Aug 2017   Iraq

In the wake of a scandal that led to the sudden resignation of Basra’s governor, Taha al-Tamimi has emerged as the top candidate to lead Iraq’s oil capital. Basra’s then-governor, Majid al-Nasrawi (L), walks with Iraqi President Fuad Masum in Basra on Feb. 23, 2015. (ESSAM AL-SUDANI/Reuters) BASRA – Days after the sudden resignation of Basra Gov. Majid al-Nasrawi, a former ExxonMobil advisor has emerged as the top candidate to replace him as the leader of Iraq’s oil capital. Taha al-Timimi, who managed government relations for Exxon’s Iraq operations from 2010 to 2014, has won the endorsement of Oil Minister Jabbar al-Luiebi and his powerful political party, the newly formed Hikma movement (Arabic for “Wisdom”). 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 .

Turkey Expands Influence In Kurdish Energy Sector

17 Aug 2017   Iraq, Turkey

Over the past 12 years, Turkish energy companies have moved into the Kurdish energy sector at great pace in line with the sector’s rapid expansion under the semi-independent government in Erbil. Energy cooperation between the Kurdistan Regional Government (KRG) and the Turkish government is the single greatest factor for energy companies’ involvement in the region and the commercial realization of this cooperation is no doubt the result of high-level political alignment. The recent downturn in the global petroleum market, the outbreak of war in North-Western Iraq, and internal political tensions have dampened investors’ expectations vis-à-vis energy sector viability in Iraqi Kurdistan. However, questions still remain as to which parties were the key beneficiaries of energy cooperation and how some of the most lucrative contracts were negotiated during the sector’s peak – many of these parties are primed to benefit should the industry pick up again. Humble Origins The KRG […]

Saudi Arabia crude oil exports fall slightly in June: JODI

17 Aug 2017   Saudi Arabia

Saudi Arabia’s crude oil exports in June fell slightly to 6.889 million barrels per day (bpd), 35,000 bpd lower than the May level, official data showed. OPEC’s biggest producer also pumped 10.070 million bpd in June, up 190,000 bpd from May, according to a posting on the Joint Organizations Data Initiative (JODI) website. The kingdom increased direct-burn crude used for power generation in June as demand for electricity increases during the hot summer months. It used 680,000 bpd of crude oil to generate power in June, up 76,000 bpd from May. The Muslim fasting month of Ramadan, when the use of electricity surges, ran from May 27 to June 25 this year. Saudi demand for oil products rose to 2.634 million bpd in June, up from 2.535 million bpd in May. The kingdom also continued to draw crude oil from its inventories, which fell […]

With a wary eye on Iran, Saudi and Iraqi leaders draw closer

17 Aug 2017   Iraq, Saudi Arabia

It was an unusual meeting: An Iraqi Shi’ite Muslim cleric openly hostile to the United States sat in a palace sipping juice at the invitation of the Crown Prince of Saudi Arabia, the Sunni kingdom that is Washington’s main ally in the Middle East. For all the implausibility, the motivations for the July 30 gathering in Jeddah between Moqtada al-Sadr and Crown Prince Mohammed bin Salman run deep, and center on a shared interest in countering Iranian influence in Iraq. For Sadr, who has a large following among the poor in Baghdad and southern Iraqi cities, it was part of efforts to bolster his Arab and nationalist image ahead of elections where he faces Shi’ite […]

Iran sees banking channels opening up

16 Aug 2017   Iran

With foreign energy companies signing early deals with Iran, the country’s president said banking channels to the world could be opening up. Last month, a consortium of French energy company Total, China National Petroleum Corp. and Petropars Ltd., a subsidiary of the state-run National Iranian Oil Co., signed a 20-year contract to help develop parts of the giant South Pars natural gas field in the Persian Gulf. It was the first contract since Iran implemented a multi-lateral nuclear deal in early 2016. With Iranian President Hassan Rouhani earning a second term in office earlier this year, the Total-led deal cleared a path for future investments from foreign energy companies. Rouhani, who helped steer the post-sanction economy, set a goal of signing 10 new […]

Iran could quit nuclear deal in ‘hours’ if new U.S. sanctions imposed: Rouhani

15 Aug 2017   Iran

Iran could abandon its nuclear deal with world powers “within hours”, if the United States continues to impose new sanctions, Iranian President Hassan Rouhani said on Tuesday. “If America wants to go back to the experience (of imposing sanctions), Iran would certainly return in a short time — not a week or a month but within hours — to conditions more advanced than before the start of negotiations,” Rouhani told a session of parliament broadcast live on state television.

Is Trump Gearing Up To End The Iran Nuclear Deal?

15 Aug 2017   Iran, USA

Jack Thompson and Oliver Thränert argue that President Trump´s administration is laying the groundwork for the U.S. to withdraw from the Iran nuclear deal. However, they suggest that if the U.S. were to end its participation in the Joint Comprehensive Plan of Action (JCPOA) on Iran’s nuclear program, it would severely damage transatlantic relations and the nuclear non-proliferation regime. As a result, Thompson and Thränert urge European governments to talk with Trump’s most influential advisers and convince them that a unilateral withdrawal from the JCPOA will leave the U.S. isolated. U.S. President Trump seems determined to kill the nuclear deal with Iran. European leaders should strive to prevent this, as it would severely damage transatlantic relations and the nuclear non-proliferation regime. Key Points • The Joint Comprehensive Plan of Action (JCPOA) of 2015, which would have been impossible without close transatlantic cooperation, brought Iran back into compliance with the […]

Kurdish oil player sees steady production course ahead

15 Aug 2017   Iraq

Gulf Keystone Petroleum sees its legacy embedded in the Kurdish north of Iraq with 40 million barrels of production. Photo courtesy Gulf Keystone Petroleum Aug. 14 (UPI) — Production from the semi-autonomous Kurdish region of northern Iraq remains at the high-end of expectations for the year, a company said. Gulf Keystone Petroleum operates the Shaikan oil field in Kurdish northern Iraq. The company said Monday it was notified by the government of a gross payment of $15 million for oil exported from the field in April. Gulf Keystone reported total average gross production for 2016 at 34,794 barrels of oil per day, at the upper range of its guidance for the year. The company said the field is performing as expected as output should average about 36,671 barrels of oil per day for the first half of the year. The company said it expects gross production for the year […]

Saudi Arabia reports higher oil revenue

15 Aug 2017   Saudi Arabia

Second quarter oil revenue was up nearly 30 percent from last year on the back of general improvements in the energy market, the Saudi government reported. Saudi Arabia is the largest producer in the Organization of Petroleum Exporting Countries. It told OPEC economists last month that production was around 10 million barrels per day, an increase of about a half percent from the average during the second quarter, but still lower than the first quarter.  Saudi Arabia is leading in terms of production cuts outlined in an OPEC-led effort to ease the supply-side strains that pushed oil prices below $30 per barrel last year. Global oil inventories are still above the five-year average and the price for Brent crude oil, the global benchmark, was at $51.70 early Monday.

The Saudi Ministry of Finance said oil revenue for the second quarter was around $269 billion, a growth rate of 28 percent from the same time last year. The government attributed the gains to improved crude oil prices for the global market.  The price for Brent is about $4.40 per barrel, or about 9 percent, higher than this time last year.  Saudi Arabia has adopted a “whatever it takes” stance on the effort to balance the market. Officials issued a joint statement with Iraq last week that restated their full commitment to the OPEC-led effort to trim production until the markets reach a target level that would indicate balance. The official news agency said the kingdom was eager to export petroleum and petrochemicals to Iraq and “increase trade exchange at all levels.”

Saudis ready to export more oil to Iraq

12 Aug 2017   Iraq, Saudi Arabia

After discussions on compliance with an OPEC-led effort to balance the market, Saudi Arabia’s energy minister said Iraq could be the target for more exports. Saudi Arabia and Iraq are the top two oil producers among members of the Organization of Petroleum Exporting Countries. Saudi Arabia has taken a “whatever it takes” stance on a multilateral effort to balance an oversupplied market for crude oil with production declines, while Iraq is said to be the least compliant among parties to the arrangement. Saudi Energy Minister Khalid al-Falih said his country was willing to “open all fields” in order to improve bilateral relations with its ally, Iraq. “The minister said that the kingdom is keen to supply Iraq with Saudi exports of […]

Saudi Arabia: Deeper Cuts Are Still On The Table

12 Aug 2017   OPEC, Saudi Arabia

OPEC and its non-OPEC partners have not closed the door to the possibility of extending the production cut agreement or even lowering production levels, Saudi Oil Minister Khalid al-Falih told Saudi-owned newspaper Asharq Al-Awsat in remarks published on Friday. Al-Falih’s comments were aired just a day after OPEC confirmed reports that its crude oil production increase last month, reporting a daily rate of 32.869 million barrels , up by 172,600 bpd. Libya, Nigeria, and Saudi Arabia were the main drivers behind the OPEC production increase, with Libya raising its output by 154,300 bpd—by far the biggest increase among the cartel’s members. Nigerian oil production rose by 34,300 bpd to 1.748 million bpd, while Saudi Arabia’s went up by 31,800 bpd to 10.067 million bpd. “The possibility of continued production cuts is on the table, and the door to extension of reduction has not been closed. If further actions are […]

Saudi Crown Prince Favors New York Over London For Aramco IPO

12 Aug 2017   Saudi Arabia

Even though Saudi Arabia’s advisors are favoring London over New York for the foreign venue to list Aramco shares, Saudi Crown Prince Mohammad bin Salman and the Saudi government are more inclined to favor New York for the world’s largest IPO next year, Reuters reported on Friday, citing sources familiar with the plans. Crown Prince Mohammad bin Salman—who is overseeing Aramco’s listing plans—may pick New York over London due to “political consideration”, in view of the long-standing Saudi-U.S. relationship, according to Reuters’ sources, who noted, however, that the final choice would also take into account financial factors. “That is broadly correct,” a senior industry source told Reuters, referring to the NYSE option for Aramco’s listing. Responding to Reuters, Aramco said that “All options continue to be held under consideration. There is no timetable requirement for an immediate definitive decision.” A possible listing on the NYSE could give Saudi Aramco […]

Iraq’s Kurds maintain Sept. 25 as date for independence referendum, Kurdish official says

12 Aug 2017   Iraq

Iraq’s Kurds will maintain their plan to hold a referendum on independence on Sept. 25, despite a U.S. request to postpone it, a high-ranking Kurdish official told Reuters on Saturday. “The date is standing, Sept. 25, no change,” said Hoshyar Zebari, a close adviser to Kurdistan Regional Government President Massoud Barzani, commenting on the request communicated by U.S. Secretary of State Rex Tillerson. The U.S. State Department said in June it was concerned that the referendum will distract from “more urgent priorities” such as the defeat of Islamic State militants.

Ex Minister: Unused Iraq-Saudi Pipeline Should Reopen

11 Aug 2017   Saudi Arabia

Iraq needs to regain access to a pipeline that was used in the past to export Iraqi crude oil via Saudi Arabia, according to Parliament member and former Iraqi oil minister, Ibrahim Bahr Al Olum. “I have discussed this issue before with the Saudi side,” Saudi newspaper Al Hayat quoted Al Olum as saying, as carried by Reuters on Thursday. The Iraqi Pipeline in Saudi Arabia (IPSA) has not been used to load Iraqi oil since the Iraqi invasion of Kuwait back in 1990. IPSA was laid across Saudi Arabia in the 1980s after both sides in the Iran-Iraq war attacked oil tankers in the Persian Gulf. Saudi Arabia confiscated the pipeline in 2001 in exchange for debts Iraq owed. In 2011, Iran threatened to block the Strait of Hormuz—which lies along the route of around 40 percent of the global seaborne oil exports—in retaliation to the Western sanctions. […]

Saudi’s Falih doesn’t rule out more oil cuts but kingdom won’t take unilateral action: Al Sharq

11 Aug 2017   Saudi Arabia

Saudi Arabia’s Energy Minister Khalid al-Falih does not rule out another oil production cut but stressed that the kingdom will not take any unilateral action, the Saudi-owned Al Sharq Al Awsat newspaper reported on Friday. The prospect of continued output cuts is on the table, and if any further action is needed, whether to extend or change production levels, it will be studied in a timely manner and agreed upon by all the producers, the paper cited Falih as saying.

Why Trump Won’t Tear Apart The Iran Nuclear Deal

9 Aug 2017   Iran

Last month, the U.S. government certified Iran’s compliance to the terms of the 2015 nuclear deal – a required approval mechanism that dictates the life or death of the deal, reviled by the White House’s new resident. “The Secretary of State is in the process as we speak of certifying to the Congress that the conditions that are laid out in the [Iran Nuclear Agreement Review Act] have been met based on information available to the United States,” an anonymous official told The Hill in mid-July. “However, the Secretary of State and the President intend to emphasize that Iran remains one of the most dangerous threats to U.S. interests and to regional stability and to highlight the range of malign activities by Iran that extend well beyond the nuclear realm,” the official added. The Trump administration argues that the deal was intended to curb Iran’s support of President Bashar […]

Saudi Arabia Builds Cities in the Sand to Move Beyond Oil

9 Aug 2017   Saudi Arabia

Kingdom is developing economic and entertainment hubs Developments aim to create jobs and boost investment After relying on oil to fuel its economy for more than half a century, Saudi Arabia is turning to its other abundant natural resource to take it beyond the oil age — desert. The kingdom is converting thousands of square kilometers of sand into new cities as it seeks to diversify away from crude, create jobs and boost investment. In the past month alone, the world’s biggest oil exporter has announced two major developments — one covering an area bigger than Belgium and another almost the size of Moscow. That’s on top of plans to build a series of so-called economic cities — special zones in logistics, tourism, industry and finance, an entertainment city and a $10 billion financial district. “The overall progress with the economic cities has been very slow, even before the […]

Rivers of crude spill from IS smuggling operation

9 Aug 2017   Iraq

Militants from the self-proclaimed Islamic State (IS) are continuing to steal oil from Iraqi fields in the mountains of Salahaddin province, in a primitive operation that has created a massive oil spill covering thousands of acres. More than two years after government forces launched an effort to secure the area, IS militants still control about 75 percent of the Alas Dome – one of the three formations that compose the Hamrin field – according to an official from the state-run North Oil Company (NOC).

Saudi Arabia cuts crude oil allocations in September by more than its OPEC pledge

9 Aug 2017   Saudi Arabia

Saudi Arabia will cut crude oil allocations to its customers worldwide in September by at least 520,000 barrels per day, an industry source said on Tuesday, as the top oil exporter makes good on its pledge to help rein in a global supply glut. State oil giant Saudi Aramco will cut supplies to most buyers in Asia – the world’s biggest oil consuming region – by up to 10 percent in September to comply with a producers’ deal to cut output, multiple sources with knowledge of the matter told Reuters. The wider Saudi cuts come as some doubts have emerged about the effectiveness of the OPEC-led agreement. OPEC output hit a 2017 high in July, according to a Reuters OPEC survey, led by a rise in supplies from Nigeria and Libya, which are both exempted from the cuts. The deal to curb output propelled crude prices […]

Saudi Aramco awards first contract for planned shipyard complex

9 Aug 2017   Saudi Arabia

Saudi Aramco said it has awarded the first major contract in the planned construction of a $5.2 billion shipyard complex designed to reduce Saudi Arabia’s dependence on oil exports. The national oil company said on Tuesday it awarded the contract for dredging, reclamation and marine structures to a consortium comprising Saudi Archirodon Co and Huta Hegerfeld AG Saudia Co. Aramco, which is leading construction of the shipyard, did not reveal the value of the contract but said it would be completed by 2020. Among other things, it includes building 4,500 meters of concrete quay walls and wharves, as well as breakwaters, at Ras Al Khair on the east coast.

United Arab Emirates, an OPEC member, eyes more oil production

Bringing new partners to the offshore sector could support the effort to boost production to 3.5 million barrels per day, the Abu Dhabi National Oil Co. said. The company, known by its acronym, ADNOC, said it was in “advanced discussions” with more than a dozen potential partners expressing an interest in offshore areas. The United Arab Emirates is strategically significant because its Fujairah port is the only export facility in the country that exists fully outside the Strait of Hormuz, the shipping chokepoint at the entrance of the Arabian Gulf. The Fujairah port is the second-largest bunkering, or maritime fueling, port in the world, behind Singapore. To meet growing demand, the port is planning to expand its storage capacity for refined products […]

Solar revolution in Lebanon could offer alternative to power blackouts

9 Aug 2017   Lebanon

For Jil Amine, Lebanon is experiencing a “solar revolution.” “The growth of the technology has been exponential,” said Amine, the United Nations Development Program project manager for the Small Decentralized Renewable Energy Power Generation Project. “The trend that we see going forward over the next half-decade should continue the high percentage growth rate.” For nearly the entire year — other than the rainy winter months — Lebanon is a sun-kissed salient, a resource being harnessed at a rapid rate to provide electricity for commercial and residential consumers. As technology drives prices down, and government subsidies and […]

Chinese refiners receive 5%-10% Saudi crude oil allocation cuts for Sep

9 Aug 2017   China, Saudi Arabia

Various Northeast Asian end-users saw their crude oil term allocations from Saudi Arabia slashed for September, with two South Korean refining companies receiving around 10% cuts in monthly contract volumes for light and medium sour grades, market sources said Tuesday.  South Korea’s two biggest refiners SK Energy and GS Caltex have received around 10% September allocation cuts from Saudi Aramco, but Hyundai Oilbank is expected to be given full term volume that it had requested for the month, South Korean trade sources with direct knowledge of the matter told S&P Global Platts.  The sources indicated that the reduction in crude allocations for September affected various sour grades including Saudi Arab Extra Light, Arab Light and Arab Medium.  “Luckily, [Hyundai Oilbank] did not see any notable cuts in September Saudi crude allocation because [the company] only nominated [relatively] smaller amount for the month,” a company source said.

Iraqi oil wealth not enough for broad economic growth

7 Aug 2017   Iraq

Moody’s gives Iraq its third-lowest rating, saying political risks and lack of diversity offset is oil wealth. Photo by cherezoff/Shutterstock Aug. 4 (UPI) — Corruption and internal political rifts could be factors weighing on the economy of OPEC-member Iraq, a report from Moody’s Investors Service said. Moody’s gave Iraq a Caa rating, its third lowest. Entities rated Caa are exposed to “very high” credit risks. The report, emailed to UPI on Friday, found Iraq was well-endowed with oil wealth, but lacks economic growth opportunities from other sectors. Iraq is a member of the Organization of Petroleum Exporting Countries and party, albeit reluctantly, to a multilateral effort to stem production in order to balance an oversupplied market for crude oil. According to secondary sources reporting to OPEC, production in June, the last full month for which data are available, was 4.5 million barrels per day, an increase of more than […]

Iraq Races To Fill The Gap Left By The Saudis

7 Aug 2017   Iraq

Iraqi oil exports topped 100 million barrels in July, but that’s still lower than the 3.93 million barrels per day rate Baghdad boasted back in May . The latest figures from the Iraqi Oil Ministry do not include exports from Kurdistan, which reach international markets via the controversial Kirkuk-Ceyhan pipeline. SOMO, the national oil distribution company, said all the exported oil had originated from central and southern oilfields. June data shows Kirkuk exporting 677,413 barrels, or 22,000 bpd. It remains unclear whether shipments from the area, formally under the control of the Kurdistan Regional Government (KRG), have been affected in July. Each month, the United States accepts a larger share of Iraq’s total exports in a bid to replace the high sulphur, heavy grades of crude that Saudi Arabia used to supply. Riyadh has made lowering its exports to the U.S. a cornerstone of its strategy to lower crude […]

Iraq gets vote of confidence from IMF, bond markets

7 Aug 2017   Iraq

After ratifying an amended 2017 budget, Iraq passed a crucial IMF review and raised $1 billion in its first unsecured bond offering since 2006. Iraqi Prime Minister Haider al-Abadi speaking at the World Economic Forum annual meeting on Jan. 23, 2015 in Davos. (FABRICE COFFRINI/AFP/Getty Images) The Iraqi government has cleared two significant hurdles in its urgent quest to attract investment capital, on the heels of Parliament’s recent passage of an amended 2017 budget law. Iraq has successfully marketed a $1 billion unsecured bond, and the International Monetary Fund (IMF) announced that it approved Iraq to receive an $825 million loan disbursement as part of a three-year program – flows of financing that could help establish an encouraging precedent for international investors. 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 […]

In Iran, Rouhani Begins 2nd Term With Signs He’s Yielding to Hard-Liners

3 Aug 2017   Iran

President Hassan Rouhani, endorsed by Iran ’s supreme leader on Thursday with a nationally televised cheek-kiss, is starting his second term under newly intense pressure from both hard-line opponents and many of his own reform-minded supporters. His brother had to be bailed out from prison after a July arrest on corruption charges that some experts see as political payback for the president’s re-election. A key oil deal Mr. Rouhani negotiated with a French company has led to accusations that he is selling the country off to foreign interests. President Trump has just signed into law new sanctions that undermine the signature achievement of Mr. Rouhani’s first term, the nuclear agreement. Now, as Iran prepares for his second inauguration on Saturday, some of the forces […]

Goldman Sachs Vies For Role In Aramco IPO

3 Aug 2017   Saudi Arabia

Goldman Sachs has bought in the secondary market part of Saudi Aramco’s US$10-billion revolving credit facility as the U.S. investment bank vies for a role in what would be the world’s biggest IPO when the Saudis list 5 percent of their oil giant next year, Reuters reported on Thursday, quoting sources familiar with the deal. Goldman Sachs is said to be following the common market practice of establishing relations with a company via a loan transaction, before entering in other deals. According to two of Reuters’ sources, Goldman Sachs bought several million dollars of Aramco’s US$10-billion revolving credit facility from Australia and New Zealand Banking Group. Saudi Aramco signed the credit facility with 27 banks in March 2015. The list of the banks that signed the original loan included American, European, Asian, and Middle Eastern banks, but not Goldman Sachs. But units of banks such as Citi, Deutsche Bank, […]

Gas pipeline inaugurated in northern Iran

3 Aug 2017   Iran

National Iranian Gas Co. said a natural gas pipeline able to lower reliance on former supplier Turkmenistan has been inaugurated in northern Iran.  Oil Minister Bijan Namdar Zanganeh opened a 160-km, 42-in. pipeline that will carry gas from a connection at Damghan through Kiasar and Sari to Neka on the Caspian Sea. The gas will come from supergiant South Pars field in the Persian Gulf.  The pipeline’s capacity, according to Iranian Gas Engineering & Development Co., is 10 million cu m/day.  The pipeline will deliver gas to the Iranian provinces of Golestan, Mazandaran, and Gilan, which suffered last winter when Turkmenistan halted deliveries (OGJ, Jan. 4, 2017). The Turkmen foreign ministry said it suspended sales to force Iran to repay debt. NIGC called the move a violation of the countries’ agreement and complained the supplier had hiked the price. Iran received as much as 10 billion cu m/year of gas from Turkmenistan after its imports from the country started in 1997.  The Turkmen government has been hurt by declining gas prices and sales.  Gazprom stopped buying Turkmen gas early in 2016 because of a price dispute.  And Chinese purchases of Turkmen gas via three pipelines transiting Kazakhstan and Uzbekistan have fallen below the government’s expectations.  Plans for a fourth pipeline between Turkmenistan and China, transiting Uzbekistan and Kyrgyzstan, were suspended in March.

Qatar Passes Landmark Law to Grant Permanent Residency to Expats

3 Aug 2017   Qatar

Qatar, facing a Saudi-led boycott, approved a landmark law with the potential to ultimately transform Gulf societies by granting permanent residency cards — and new rights — to some of the foreigners who dominate its population. The move would be the first in the Gulf region, where the privileges of nationals have been zealously guarded and expatriates’ access to public services and property rights are sharply curtailed. Under the new law, cardholders will be treated like Qatari nationals and will benefit from elements of the state’s generous welfare system, including education and health-care services, the official Qatar News Agency reported late Wednesday. They will also be given priority, after locals, for military and civilian public jobs and would be allowed to own property and run certain commercial activities without a local partner, QNA reported. Those eligible for the card include children of Qatari women married to foreigners, people with special talents “needed by the state,” and others who have extended notable services to the country, it said. Citizenship, however, will remain off-limits to foreigners.

Iran making pipeline strides

3 Aug 2017   Iran

Iran is becoming less dependent on its neighbors for natural gas with the launch of a pipeline to the northern provinces, the government said. Iranian Energy Minister Bijan Zangeneh was on hand for a ceremony for the launch of the Damghan-Neka natural gas pipeline for the customers in the isolated north of the country, the energy ministry’s news website SHANA reported. “Construction of the project began 10 years ago but gained much momentum after Turkmenistan reneged on its promise to supply gas to Iran last winter demanding extra charges for its gas to Iran,” the report read. “The much-awaited gas pipeline is going to guarantee the steady supply of natural gas to the regions […]

Did The Arab Spring Disarm OPEC?

3 Aug 2017   Middle East

OPEC is struggling with a floundering oil market, few prospects of higher oil prices, competition from U.S. shale, and dissension within its own ranks. The supply/demand situation is improving, but at a painfully slow pace. OPEC will meet again in a few days to try to figure out how to boost compliance with the collective cuts, but the group is faced with no good options in trying to balance the market. The prospect of deeper cuts has been floated, but the risk is that it would require more sacrifice with an uncertain payoff. In any event, OPEC appears to be struggling with maintaining compliance for its existing cuts. Although some dispute the data, it appears that more than half of the participating OPEC members are not fully complying with their obligations. Worse, Nigeria and Libya, exempted from the deal, are boosting output. OPEC production actually jumped in July by […]

Special Rules Won’t Fly For Aramco IPO

3 Aug 2017   Saudi Arabia

The UK Institute of Directors has criticized the Financial Conduct Authority’s proposal to amend listing rules that would accommodate Saudi Arabia’s oil giant Aramco, which is planning to list 5 percent in London next year. According to the organization, which brings together business leaders from all industries, such a rule change is not justified and it might compromise London’s reputation for corporate governance. The FCA, UK’s financial markets regulator, had previously proposed a new category within its rules for premium listings, “to cater for companies controlled by a shareholder that is a sovereign country.” The aim was to convince Aramco to go for the premium, rather than the standard, listing. Aramco wants to sell just 5 percent, but under FCA rules, a company qualifies for a premium listing only if it has a minimum 25 percent free float, meaning that Aramco’s 5-percent listing would fall significantly short of qualifying—that […]

Kurdistan Claims Iraq-Iran Oil Pipeline Violates U.S. Sanctions

2 Aug 2017   Iran, Iraq

The autonomous Iraqi region of Kurdistan has not been informed of plans by the central government that Iraq and Iran agreed to study the potential construction of a pipeline that would export crude oil from fields in Kirkuk via Iran, a senior Kurdish lawmaker told London-based Arab daily Asharq al-Awsat on Tuesday, adding that the Iraq-Iran project was violating U.S. sanctions on Iran. Over the weekend, Iran’s Oil Minister Bijan Zanganeh said that Iraq and Iran had reached an agreement to commission a feasibility study of a crude oil pipeline that would export oil from fields in Kirkuk via Iran. “In order to raise more legal problems in Kirkuk, Baghdad and Tehran have been trying for a long time to work on a pipeline to transport crude oil from the province to the Iranian territories,” Dilshad Shaaban, deputy chairman of the Kurdistan Parliament’s natural resources committee, told Asharq Al-Awsat. […]

Saudi Aramco IPO Pits London Against New York

2 Aug 2017   Saudi Arabia

Saudis soon to choose foreign bourse for top oil exporter Hong Kong, Tokyo, Singapore, Toronto also vying for giant IPO Saudi Arabia aims to sell about 5 percent of Saudi Aramco in an initial public offering next year, and stock exchanges from the U.K. to Japan are vying for what may be the world’s richest IPO. The Saudi crown prince, Mohammed bin Salman, will soon decide where to sell the company’s shares after government officials heard a presentation on the listing process last week, according to people with knowledge of the matter. The kingdom plans to list on the Saudi stock exchange in Riyadh and choose to sell shares on at least one bourse outside the country. That choice pits the top global financial centers, London and New York, against each other for a sale that could value the largest oil exporter at as much as $2 trillion. Here’s […]

Qatar Dispute Back To Square One

2 Aug 2017   Qatar

The four countries leading the boycott against Qatar are going back to their list of 13 demands for Doha to meet before talks can start, essentially reverting the Arab Gulf spat back to square one. At the same time, economic data for June shows that Qatar’s imports plummeted due to the blockade imposed by most of its neighbors, and foreign deposits at Qatari banks dropped to their lowest in nearly two years. However, Qatar has a huge sovereign wealth fund, and boasts considerable foreign exchange reserves. Although Qatar’s non-oil economy is expected to see some pressure due to the fact that it has to use alternative trade routes, the world’s largest LNG exporter has not seen its LNG trade disrupted yet, which is precisely why analysts do not see the blockade as potentially crippling Qatar’s economy. Rather, they see it as merely straining economic growth. Saudi Arabia, Bahrain, Egypt, […]

Oil exports steady through July

2 Aug 2017   Iraq

Slight increase in independent KRG exports offsets small reduction in federal Iraqi exports. Loading arms at the terminal for Iraqi crude exports at the Turkish port of Ceyhan. (STAFF/Iraq Oil Report) Iraq’s overall oil export levels were virtually unchanged in July, as the country sold a total of about 3.801 million barrels per day (bpd), compared to 3.811 million bpd in June . The federal government exported 3.230 million bpd, according to an Oil Ministry statement * – down slightly from 3.273 million bpd in June. 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 .

Baghdad pursues Kirkuk-Iran pipeline

1 Aug 2017   Iran, Iraq

After voicing opposition to the KRG’s independence referendum, Iran contemplates a deal that could shift the balance of power in Iraq’s disputes over territory and oil. Iraqi Oil Minister Jabbar al-Luiebi answers questions from reporters at the OPEC headquarters ahead of the organization’s crucial meeting on May 25, 2017. (BEN LANDO/Iraq Oil Report) Iraq is taking steps to build an oil pipeline from Kirkuk to Iran – an initiative that could further complicate long-standing disputes between Baghdad and the autonomous Kurdistan region over oil and territorial control. “We agreed on a joint committee to study the possibility of exporting Kirkuk’s oil to an Iranian refinery by pipeline,” said Iraqi Oil Minister Jabbar al-Luiebi, in a statement issued after Sunday meetings in Tehran with his counterpart, Iranian Oil Minister Bijan Zanganeh. This content is for registered users. Please login to continue. If you are not a registered user, you may […]

Iran, Iraq moving closer to construction of Kirkuk pipeline: minister

31 Jul 2017   Iran, Iraq

Iran and Iraq are moving closer to building a pipeline that would export crude oil from the northern Iraqi fields of Kirkuk via Iran, Iranian Oil Minister Bijan Zanganeh said on Sunday after meeting his Iraqi counterpart Jabar al-Luaibi, according to the official news site of the Iranian oil ministry. Agreements were reached between the two ministers about an international company that will carry out a feasibility study of the project, Zanganeh was quoted as saying in the SHANA report. Iraq and Iran signed a memorandum of understanding in February to study the construction of the pipeline. Separately, Zanganeh said Iran would begin exporting gas to the Iraqi city of Basra in coming months. He said there had been some problems in receiving payments for current gas exports to Iraq via banks and that Iran was receiving cash payments.

Saudi Arabia says calls for internationalization of holy sites ‘a declaration of war’

31 Jul 2017   Saudi Arabia

General view of the Kaaba at the Grand Mosque in Mecca, Saudi Arabia September 9, 2016. Ahmed Jadallah/File Photo DUBAI (Reuters) – Saudi Arabia’s foreign minister called Qatar’s demands for an internationalization of the Muslim hajj pilgrimage a declaration of war against the kingdom, Saudi-owned Al Arabiya television said on Sunday, although it was unclear whether Qatar had actually made any such demand. “Qatar’s demands to internationalize the holy sites is aggressive and a declaration of war against the kingdom,” Adel al-Jubeir was quoted saying on Al Arabiya’s website. “We reserve the right to respond to anyone who is working on the internationalization of the holy sites,” he said. However, it was unclear whether Qatar made the demand. It did accuse the Saudis of politicizing Hajj and addressed the United Nations Special Rapporteur on freedom of religion on Saturday, expressing concern about obstacles facing Qataris who want […]

Oil Prices Rise As Saudi Arabia Attacks The Glut

29 Jul 2017   Prices, Saudi Arabia

Back in late May, Saudi Oil Minister Khalid Al-Falih said that ‘exports to the U.S. will drop measurably ‘, as the OPEC Kingpin adjusted its focus to reducing exports to the world’s most transparent energy hub. Exports from Saudi to the U.S. take approximately seven weeks to arrive – hence, as we swiftly approach the end of July, we can see from Saudi deliveries this month that they are not just talkin’ the talk, but walkin’ the walk. We have regularly been assessing U.S. imports from Saudi Arabia here on the blog, given that production cuts should be reflecting through into lower flows . Imports in January reached nearly a three-year high, as the leading exporter from OPEC ramped up crude exports at the end of last year ahead of the January production cut. Imports remained strong through May, averaging over 1.2 million barrels per day for the first […]

Russia drafts agreement to tap Iranian oil fields

29 Jul 2017   Iran, Russia

Russia and Iranian agreement involves the potential to tap into Iranian oil fields. The signing of the deal comes as both countries face tighter sanctions pressure from U.S. lawmakers. Image courtesy of Gazprom Neft. July 28 (UPI) — An agreement with an Iranian engineering services company expressed mutual interest in working in the oil fields of Iran, a Russian energy company said. Russian energy company Gazprom Neft signed a memorandum of understanding with Iran’s Oil Industries’ Engineering & Construction. The agreement confirms “both companies’ mutual interest in combining forces in the preliminary assessment and investigation of the geological potential of oil fields located in the Islamic Republic of Iran,” the Russian company stated . The memorandum came as both sides faced pressure from U.S. lawmakers. On Tuesday, the U.S. House of Representatives, in a 419-3 vote , opted to toughen sanctions on Iran, North Korea and Russia. House Speaker […]

Saudi Coalition Blocks Four Oil Tankers From Entering Houthi Port

28 Jul 2017   Saudi Arabia, Yemen

The Saudi Arabia-led coalition and the Yemeni government blocked four oil tankers from entering the Hudaidah port on the Red Sea, in a move that will likely worsen the health crisis occurring in the war-torn country. The Hudaidah port is currently controlled by the Houthi rebels, a Shiite militant group that is backed by Iran. The Saudi coalition is trying to contain the spread of Iranian influence in the region by fighting a proxy war for control of the Bab al Mandab strait, which controls oil traffic to the booming markets of sub-Saharan Africa. Yemen has reported over 400,000 cases of cholera in recent months. The disease is spread through polluted water, which require water pumps—which in turn require fuel to run. Oil is also required to power hospitals and other critical infrastructure. The tankers denied entrance to the port contained ten percent of Yemen’s monthly energy needs. Coalition […]

Trump Seeks Way to Declare Iran in Violation of Nuclear Deal

28 Jul 2017   Iran, USA

President Trump, frustrated that his national security aides have not given him any options on how the United States can leave the Iran nuclear deal, has instructed them to find a rationale for declaring that the country is violating the terms of the accord. American officials have already told allies they should be prepared to join in reopening negotiations with Iran or expect that the United States may abandon the agreement, as it did the Paris climate accord. And according to several foreign officials, the United States has begun raising with international inspectors in Vienna the possibility of demanding access to military sites in Iran where there is reasonable suspicion of nuclear research or development. If the Iranians balk, as seems likely, their refusal could enable Washington to declare Tehran in violation of the two-year-old deal. Mr. Trump has enormous latitude to abandon the accord. It was never a […]

Chinese consortium in talks over Nassiriya deal

28 Jul 2017   China, Iraq

Iraq has entered direct negotiations with a Chinese consortium for the combined Nassiriya refinery and oil field development project. PetroChina and the China National Offshore Oil Corp. (CNOOC), which have a large and well established presence in Iraq, are offering to build a $9 billion refinery, according to two senior Iraqi oil officials involved with the negotiations. The ministry has rejected that proposal as too costly. 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 .

A Natural Gas War Is Brewing In The Mediterranean

28 Jul 2017   Cyprus, Middle East

Offshore gas developments in the East Mediterranean region are heating up. Alongside increased exploration efforts and a possible gas pipeline deal between Turkey and Israel, geopolitical risks are increasing too. While commercial prospects are starting to look good for all parties, a real military conflict is also brewing and may come to a head if Cyprus, Greece and Turkey are not able to find a solution soon. Optimism has been high of late about the prospects of offshore Cyprus gas developments, not only due to the increased interest and agreements reached by Nicosia and several international partners, but also based on a possible Cyprus reunification success. However, the latest development has once again proved to be in vain, as the two main stakeholders, Greek Cyprus and Turkish Cyprus, were again not able to find a solution to solve the dispute. Both sides still accuse each other of being unwilling […]

Exclusive: Saudi Aramco advisers favor London for historic IPO – sources

28 Jul 2017   Saudi Arabia

Saudi Aramco’s advisers have recommended London for the historic listing of the oil company, with U.S. disclosure rules a concern for Saudi authorities, sources familiar with the matter told Reuters. A final decision on the venue for what is expected to be the world’s biggest IPO and is targeted to raise $100 billion will be taken by Crown Prince Mohammad bin Salman, who is overseeing Saudi Arabia’s radical economic reforms, they said. Listing five percent of Aramco is a centerpiece of Saudi Arabia’s Vision 2030 plan to diversify beyond oil and financial considerations will not be the only factor in its decision, with Saudi authorities also taking the interests of shareholders and the company into account, the sources added. The advisers’ views on the […]

The Saudi Power Balance Is On A Knife-Edge

27 Jul 2017   Saudi Arabia

The sweltering heat of Saudi Arabian summer will feel like a cool breeze compared to the geopolitical fire that could soon take over the country if ongoing internal power struggles destabilize the Kingdom’s Royal Family and national security in the coming weeks. After his successful elevation to Crown Prince, Mohammed Bin Salman (MBS) has been appointed by King Salman to be in charge during his holiday to Morocco. The King’s holiday comes at a time of relative instability in the Kingdom, as the effects of the removal of former Crown Prince Mohammed Bin Nayef at the end of the Ramadan period continue to linger. King Salman’s choice to award his son the position of Crown Prince was expected, but insiders are warning that his predecessor still holds a great deal of influence. To put MBS in charge during this already very volatile period in the Gulf, as the Saudi-led […]

Saudi Arabia Growing Nervous Over OPEC Compliance

27 Jul 2017   OPEC, Saudi Arabia

OPEC officials are hoping to limit the production of both Libya and Nigeria, as fears grow that the two exempted members are undermining cuts from the rest of the cartel. Saudi Arabia is also promising to lower its oil exports in order to take more supply off of the market. Saudi Arabia’s energy minister Khalid al-Falih reportedly cut short his vacation in order to attend the OPEC monitoring meeting in St. Petersburg on Monday, an unexpected move that put more weight on the details of the gathering. His attendance suggests OPEC is worried about the pace of rebalancing in the oil market, and also raises speculation about what OPEC might do next. OPEC’s Secretary-General Mohammad Barkindo said al-Falih decided to attend because of the meeting’s “strategic importance” and because of “the high expectations of the times,” the Wall Street Journal reported. The WSJ also said that al-Falih was “very […]

Kuwait To Curb Oil Exports To US—Will Iraq Step In?

27 Jul 2017   Iraq, Kuwait

In the latest round of OPEC promises, Kuwait’s state run oil company has pledged to cut “contractual sales volumes of oil for 2017” according to Bloomberg Markets . Kuwait Petroleum Corporation made the announcement just one day after fellow OPEC member UAE promised to cut its own oil exports by 10 percent starting in February, and just two days after OPEC conductor Saudi Arabia promised to curb oil exports starting in August. The renewed OPEC vows to chip in towards doing “whatever it takes” to rebalance the oil markets comes just days after Saudi Arabia chastised members for not adhering to the OPEC agreement. The United Arab Emirates, for example, failed to comply with the deal even a single month so far during the collective agreement to cut out 1.2 million barrels of oil production. Kuwait’s compliance, on the other hand, has been much higher. And now that it […]