Recent Articles

Tidal Lagoon Energy in Wales

17 Feb 2017   Tidal, United Kingdom

The report of an independent review of UK tidal lagoon energy was published on 12 January 2017 by a former UK energy Minister Charles Hendry. The report praises the proposed ‘pathfinder’ tidal lagoon in Swansea Bay as a ‘no-regrets option’, and sets out a supportive case for developing the sector. The Hendry Review was commissioned in February 2016 by UK Government to assess the strategic case for tidal lagoon energy as a new industry in the UK. This followed a successful planning proposal by Tidal Lagoon Power (TLP) to develop the world’s first tidal lagoon in Swansea Bay, as well as a subsequent programme for a ‘fleet’ of five larger projects, including three in Welsh waters (Cardiff, Newport and Colwyn Bay). Despite the Swansea Bay project appearing in the 2015 UK Conservative Party manifesto and receiving development consent in June 2015, uncertainties around cost and subsidy subsequently prompted the […]

Decline of UK’s Rough storage site to raise gas import costs

17 Feb 2017   United Kingdom

The decline of Britain’s biggest gas storage site and the lack of new-build to replace it will increase dependency on imports over the next few years, boosting wholesale market volatility and consumer gas prices. Seasonal gas storage provides security and flexibility of supply. At times of low demand and therefore low gas prices in the summer, gas is injected into storage to be kept for when demand rises in the winter. Rough, the country’s only seasonal gas storage site, can usually meet around 10 percent of Britain’s peak daily gas demand but is currently capable only of handling 5 percent. At over 30 years old, the depleted gas field off England’s east coast has undergone prolonged outages over the past year due to problems with well pressure; six wells have permanently closed and […]

Oil prices steady on OPEC cuts, but record U.S. fuel stocks weigh

16 Feb 2017   Prices

Oil prices held steady on Thursday, supported by ongoing supply cuts led by producer group OPEC, although rising fuel inventories and crude production in the United States weighed on sentiment. Brent crude futures were trading at $55.73 per barrel at 0209 GMT (9:09 p.m. ET on Wednesday), down just 2 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures, were down 4 cents at $53.07 per barrel. The Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia have agreed to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017, and estimates suggest compliance by OPEC is around 90 percent. The production cuts are aimed at reining in a global fuel supply overhang that has dogged markets for over two […]

Higher inventories send oil prices lower

16 Feb 2017   Prices

More signs of recovery in U.S. shale oil basins and indications of a build in inventories sent crude oil prices lower early Wednesday. Crude oil prices rallied Tuesday to offset dramatic losses from earlier this week. Markets in general rallied after Federal Reserve Chair Janet Yellen issued a general upbeat assessment of the U.S. economy. Oil prices have moved in a narrow band around $55 per barrel more or less since late 2016 as markets watch for signs of a healthy balance between supply and demand. An agreement by the Organization of Petroleum Exporting Countries to limit output has been countered by a rise in North American oil production, which reflects improved economics in the energy sector. Markets early Wednesday were reacting […]

Oil Closes Near $53 as Record U.S. Supply Counters OPEC Cuts

16 Feb 2017   Prices

Oil closed near $53 a barrel as record U.S. inventories tempered the impact of OPEC’s production cuts. American crude supplies climbed 9.53 million barrels to 518.1 million, the highest level in weekly data going back to 1982 and more than twice the 3.5 million-barrel gain forecast by analysts surveyed by Bloomberg before a government report Wednesday. Gasoline stockpiles also rose to a record, while refinery oil demand slipped as seasonal maintenance was performed. Saudi Arabia told OPEC that it cut output last month by the most in eight years, more than it pledged under a deal to curb supply, the group’s monthly market report on Monday showed. Oil has traded above $50 a barrel since the Organization of Petroleum Exporting Countries and 11 other countries started trimming supply on Jan. 1. OPEC’s secondary source estimates indicate that the 11 members subject to the accord are achieving more than 90 […]

Kuwait Boosts Oil Capacity to Open Taps Once OPEC’s Cuts Expire

16 Feb 2017   Kuwait

Kuwait is sticking with plans to add half a million barrels a day of oil-production capacity as it prepares for the eventual expiration of the output quotas OPEC adopted to help drain a global oversupply, the head of Kuwait Oil Co. said. State-run KOC plans to raise the Gulf nation’s capacity from its current level of 3.15 million barrels a day, Chief Executive Officer Jamal Jaafar said in an interview in Kuwait City. The company, which is responsible for most of Kuwait’s domestic crude production, will add capacity even if the Organization of Petroleum Exporting Countries decides to extend the supply cuts beyond June, he said. “We will continue to increase production capacity because we have a five-year plan to reach 3.65 million barrels a day by 2021, so we can’t stop investing in that,” Jaafar said on Wednesday. “We will take advantage of the OPEC-cut deal to perform […]

Libya Crude Output Rises as Work Conditions for Big Oil Improve

16 Feb 2017   Libya

Libya’s crude production exceeded 700,000 barrels a day and is due to keep rising as working conditions in the conflict-ridden country improved for international companies like Eni SpA and Total SA , an official from the state oil company said. The North African country’s crude production is due to reach 1.2 million barrels a day by August and 1.7 million by March 2018 when the nation’s ports and export terminals will be operating at full capacity, Jadalla Alaokali, board member of Libya’s National Oil Corp., said in an interview in Cairo. Output at the El Feel, or Elephant, oil field is due to resume within one month, pumping 75,000 barrels a day, he said. Eni and Total are working in Libya without difficulty and Schlumberger Ltd . resumed operations in the country about three months ago, he said. Eni is due to start production from an offshore area in […]

OPEC notes role as market stabilizer

16 Feb 2017   OPEC

The secretary-general of OPEC said market stability was a primary objective for the production group, but noted the importance of spare capacity. Mohammad Sansui Barkindo, the secretary-general of the Organization of Petroleum Exporting Countries, continued his visit with Saudi delegates this week. In Riyadh, he discussed market trajectory with Saudi Energy Minister Khalid al-Falih, who serves also as the president of the OPEC conference. During his meetings, Barkindo said Saudi Arabia is a key player and one of the primary movers behind a deal reached in November to erase the glut of oil on the market that dragged oil prices to historic lows last year. “OPEC’s goal is stability of the oil market,” he said in a statement . As its largest producer, Saudi Arabia […]

Saudis Lose South Korean Market Share To Iran

South Korea doubled its imports of Iranian crude in January this year from the same time last year, when Iran returned on the international oil market and started exporting growing amounts of oil in a bid to regain market share lost to the Western sanctions. According to preliminary South Korean customs data reported by Reuters , the Asian country, which is also the world’s fifth-largest crude importer, last month imported 1.79 million tons of crude from Iran, which is equal to 424,143 bpd, compared to 859,223 tons in January 2016, when sanctions on Iran were lifted. This development takes market share away from Iran’s key rival, Saudi Arabia. South Korea’s imports of crude oil from Iran’s regional rival Saudi Arabia dropped by 17.3 percent in January compared to December 2016, to 785,084 bpd, as the Saudis are complying with the OPEC supply-deal cut. South Korea’s total crude oil imports […]

Can Saudi Arabia Carry OPEC Through Spring?

16 Feb 2017   OPEC, Saudi Arabia

Faced with budget strains amid low oil prices, Saudi Arabia ditched its pump-at-will policy and brought together the diverse group of OPEC nations to agree to production cuts late last year. Now the cartel’s de facto leader and largest producer is going the extra mile in reducing output, at least in January. The Saudis pledged the biggest cut in the November 30 deal , and last month went beyond the required amount to ensure a high rate of compliance. Initial estimates by the International Energy Agency (IEA) and OPEC itself show that the cartel’s early compliance to cuts is very high: more than 90 percent. The unexpectedly high rate is almost solely courtesy of Saudi Arabia. Bloomberg estimates — based on IEA and OPEC figures — show that just three out of 10 OPEC members that had promised cuts managed to reduce their output to target production levels in […]

Assassination and bombings roil Basra

16 Feb 2017   Iraq

ABasra leaders are scrambling to contain an outbreak of violence that has targeted political figures and provoked outrage among Shia paramilitary groups.The spate of violence began with the assassination, on Feb. 8, of Bassam al-Mosawi, the general secretary of the paramilitary group Hizbollah Iraq. Over the following week, six improvised explosive devices (IEDs) have detonated around the city, one outside the home of an official from the Dawa political party.In response to the deteriora… 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 . […]

California demand for wind power energizes transmission firms

16 Feb 2017   Wind

A firm controlled by Philip Anschutz, the billionaire entertainment and pro sports magnate, will soon build the largest wind farm in the United States to serve utilities in California, where officials have set ambitious green power goals. The $5 billion project, however, will be constructed 700 miles away in Wyoming, a state better known for coal mines and oil fields. The vast distance between the two states provides a different Anschutz-owned firm with another big opportunity: a $3 billion project building transmission lines to deliver the power – one of a dozen similar power-line projects by other companies across the West. (Map: How wind power will get from Wyoming to California click here ) In all, about 5,700 miles of transmission lines are in development with the goal of delivering renewable energy to California from other states, according to the Western Interstate Energy Board. Such investments are an outgrowth […]

U.S. gas prices likely at short-term low

16 Feb 2017   Prices

Feb. 15 (UPI) — A retail price watchdog said this may be the short-term seasonal low point for U.S. gasoline prices as refiners start switching to a different blend. “You’ve been warned,” an emailed report from GasBuddy.com read. “Gas prices are about to get pumped up, eventually climbing to the year’s highest levels as refineries across the nation are preparing for maintenance season and the seasonal switch to cleaner burning gasoline, a tradition despised by many.” The price watchdog group lists an average retail price for a gallon of regular unleaded gasoline at about $2.26, relatively steady over the last week. Gas prices have moved more or less in parallel with crude oil prices, which have traded in a narrow band around the $55 per barrel mark since late last year. GasBuddy explains retail gasoline prices usually spike in the weeks heading into the Memorial Day holiday season as […]

Tribe tries again to block Dakota Access pipeline

16 Feb 2017   Pipelines

The tribe at the center of the debate over the construction of the Dakota Access pipeline said it was again challenging the White House on the issue. President Donald Trump last week gave final approval to finish the last stretch of the oil pipeline in North Dakota beneath Lake Oahe, a federally owned body of water. That section is the last major hurdle standing in the way of the line’s completion and the center of the debate over the controversial artery. David Archambault II, chairman of the Standing Rock Sioux Tribe, said his organization filed a legal brief seeking a reversal of permits issued by the U.S. Army Corps of Engineers for pipeline construction. “President Trump claims he has not received ‘a […]

Electric Car Sales Undaunted By Low Gasoline Prices

16 Feb 2017   Electric Cars

While oil and gasoline prices have traditionally determined the fate of electrified vehicle sales, plug-in vehicles are seeing other forces shaping global markets. When oil prices plunged in 2014, hybrid vehicles took a hit along with their residual values in several global markets. Plug-in electrified vehicles – battery electric and plug-in hybrid – saw similar trends emerging at first. However, PEVs have seen unit sales rise significantly in the U.S., Europe, and China during the past two years – as gasoline prices have stayed down. It appears that other market dynamics are influencing PEV sales now more than oil and fuel pump prices. Government-backed China Association of Automobile Manufacturers (CAAM) has projected 800,000 “ new energy vehicles ” (PEVs) will be sold this year in China – a 58 percent increase over 2016. Last year, there were about 507,000 new energy vehicles sold, growing by more than 50 percent […]

U.S. Crude Inventories Reach Record High After EIA Reports Significant Build

16 Feb 2017   Oil Supply, USA

For the third week in a row the Energy Information Administration (EIA) has reported an increase in commercial crude oil inventories of 9.5 million barrels, to a total of 518.1 million barrels – exceeding the seasonal limit. The report came a day after the API estimated commercial inventories had jumped by 9.94 million barrels . The news is bound to cause worry among OPEC members who are being made painfully aware by U.S. shale boomers that the production cut agreement agreed to in November was a windfall for them – a windfall that they will make the best of while it lasts. Though prices started the week on the rise, boosted by the latest positive update from OPEC, including the IEA praising the cartel for its 90-percent compliance rate, the API figures partially offset the rise and now the EIA figures might offset the rest. The weekly inventory reports […]

Trump’s First Law Removes Transparency Rule For Big Oil

16 Feb 2017   Congress

President Trump’s first legislative act was to sign into law a repeal of a transparency rule aimed at keeping public oil companies in check with regard to their international operations and limiting the scope for bribery and corruption. Part of the so-called Dodd-Frank Act, devised after the 2008 financial crisis to avoid a repeat of the events that led to it, the rule stipulated that U.S. public oil companies must declare all payments made to the U.S. and foreign governments and agencies in the form of royalties and taxes, starting from their financial year ending in or after September 2018. It was an Act that Big Oil was very vocally against, saying the rule put it at a disadvantage to its foreign peers. Many of these foreign competitors are based in Europe, however, and are bound by similar regulations issued by the EU, supporters of Dodd-Frank have argued. Public […]

Solar Installations Surge 95% In 2016

16 Feb 2017   Solar

The solar industry posted its best year on record in 2016, obliterating previous records by installing a smashing 14.6 gigawatts of new solar in the U.S. That is a 95 percent increase from the 7.4 GW installed in 2015, which happened to be the previous record. It was the best year in the history of the U.S. solar business, according to new data from GTM Research and the Solar Energy Industries Association (SEIA). Even more impressive is the fact that with a cumulative installed capacity at just over 40 GW, roughly one third of all solar capacity ever installed was installed in 2016. Of course, solar has been growing from a small base, and it still represents around 1 percent of total electricity generation. But what matters going forward is growth, and the 2016 figures point to a solid trend that suggests solar will dominate the future. In 2016, […]

Canadian Prime Minister Bans Arctic Drilling… For Now

16 Feb 2017   -

Canadian Prime Minister Justin Trudeau has defended his government’s decision to ban all drilling for oil and gas in the Arctic for the next five years—for starters—in response to a local mayor’s cries that the bank will cost jobs for communities, even though Big Oil can’t really afford to drill right now. Trudeau referred to scientific data revealing that an oil spill in the Arctic would be much more difficult to deal with than anywhere else, but left a tiny window open for the oil industry. If Big Oil comes up with technology that can guarantee safe drilling in the Arctic, the ban could be reconsidered, he said. It is clearly a window that won’t be opened in the next five years—an unrealistic timeframe for developing 100 percent safe drilling technology. In fact, it’s probably safe to say that there can be no 100 percent spill-proof drilling technology, so […]

Oil dips over doubts that high OPEC compliance with announced cuts will last

15 Feb 2017   Prices

Oil prices dipped on Wednesday over concerns that producer club OPEC would not be able to maintain its high compliance so far with output cuts aimed at reining in a global fuel supply overhang. Brent crude futures LCOc1 were trading at $55.80 per barrel at 0115 GMT, down 17 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1, were down 20 cents at $53 per barrel. The Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia have agreed to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017. BMI Research said that, based on a calculated compliance of 92.8 percent by OPEC […]

In oil mystery, traders resort to ‘buy the builds’ mantra

15 Feb 2017   Prices

A mystery is confounding the US oil market: when inventories rise, prices rise, too. That is not the way it is supposed to work. At 508.6m barrels as of early February, stocks of crude sitting in commercial tanks were 8 per cent higher than a year before and close to a record. In theory, the excess supply should weigh on markets. But this year a loose pattern has emerged after the US government releases weekly oil data: surprisingly large increases in crude stocks have prompted spurts of buying. “The mantra is ‘buy the builds’,” said Andy Lebow of Commodity Research Group, a US consultancy. “It seems to be working, week after week, as inventories build.” The midweek petroleum status report of the Energy Information Administration is watched obsessively by traders, shedding light on supply and demand in the leading oil-consuming nation. The next one is due on Wednesday morning Washington time. Over the last five reports US commercial crude oil stocks rose by a total of 29.6m barrels. Each weekly rise surpassed expectations. While declining immediately after each report, the price of the West Texas Intermediate oil benchmark was trading higher 20 minutes later, often accompanied by a burst of volume. WTI prices also settled higher after four of the past five releases.

A Bloodbath Looms Over Oil Markets

15 Feb 2017   Prices

Oil prices have traded reliably in the $50s per barrel since OPEC agreed to cut production last November, but having failed to break through a ceiling in the upper-$50s, crude prices are in danger of falling back again. The oil market had wind in its sails on expectations of substantial drawdowns in inventories following the pending cut of a combined 1.8 million barrels per day (1.2 mb/d from OPEC plus nearly 0.6 mb/d from non-OPEC countries). Indeed, the IEA reports that oil inventories in OECD countries have declined for five consecutive months, although they still stand above the running five-year average. Meanwhile, in the U.S. oil inventories have actually increased significantly so far in 2017. The shockingly high compliance rate that OPEC has thus far achieved this year, one would think, should have pushed oil prices up much higher. But crude prices have barely budged since several key market […]

Why Sub $50 Oil Is More Likely Than $70 Oil

15 Feb 2017   Prices

It is more likely that oil prices will fall below $50 per barrel than that they will continue to rise toward $70. Prices have increased beyond supply and demand fundamentals because of premature expectations about the effects of an OPEC production cut on oil inventories. Last week’s 13.8 million barrel addition to U.S. storage was the second largest in history. It moved U.S. crude oil inventories to new record high levels. Meanwhile, 130 horizontal rigs have been added to tight oil drilling since the OPEC cut was first announced in September. That means that U.S. output will surge and will continue to be a drag on higher prices. Comparative inventory analysis suggests that the current ~$53 per barrel WTI oil price is at least $6 per barrel too high. Don’t hold your breath for $70 oil prices. Inventory Is The Key Most analysts believe prices will increase steadily now […]

Are OPEC’s Cuts Adding Up to Lower Oil Prices?

15 Feb 2017   Prices

Measuring the success of OPEC’s production cuts has never been harder. Oil traders say they aren’t just looking at the most recent numbers from the Organization of the Petroleum Exporting Countries showing it is complying with its pledge to cut almost 1.2 million barrels a day from the global market. Instead, they are watching for signs that U.S. oil output is growing, that oil storage is falling and that other big producers like…

Milestones on the oil market’s road to rebalancing

15 Feb 2017   Prices

Crude oil stockpiles are expected to empty significantly during the third quarter as continued production restraint from OPEC interacts with the seasonal increase in consumption. OPEC and non-OPEC countries are committed to reducing production by an average of nearly 1.8 million barrels per day in the first six months of 2017, with an option to extend cuts for a further six months. Production assessments by independent agencies suggest compliance with the agreement has so far been high from OPEC especially from Saudi Arabia and its allies. Further reductions from non-OPEC could be phased in over the next few months, with Russia in particular committed to increase its production cuts progressively during the compliance period. Set against this is the risk of “compliance fatigue” if OPEC and non-OPEC countries […]

Iraq Plans For Enormous Boost To Refining Capacity

15 Feb 2017   Iraq

Iraq’s government is ambitious and it wants to make the most of the country’s oil and gas reserves. Plans for an expansion of the country’s refinery network have been circulating for years, but the war with IS has put these on hold. What’s worse is that the prospects for these plans are gloomy unless it gets a significant amount of external help. Before the war with IS engulfed OPEC’s second-largest exporter, plans were to add five new refineries to the network over a period of 20 years, starting in 2008. At the time, the refining capacity of Iraq stood around 886,000 bpd. Since then, the only progress made has been the start of construction of the Karbala refinery, as one expert, the former chief of the Energy Study Secretarial of OPEC, notes in an industry analysis. In it, Saadallah al Fathi quotes information from an unnamed industry insider who […]

New deal links Kirkuk oil and KRG refineries

15 Feb 2017   Iraq

The federal Oil Ministry has begun sending NOC-produced crude to KRG refineries, generating badly needed fuel that will supply areas liberated from IS. New deal links Kirkuk oil and KRG refineries Kirkuk Gov. Najmaldin Karim (far right) and Deputy Oil Minister Dhia Jaffar (second from right) meet with oil officials in Kirkuk, including Saad Hassan, the CEO of Qaiwan Group (fourth from left), and Baz Karim, CEO of KAR Group (third from left), on June 6, 2016. (Photo credit: Kirkuk governor’s office) Federally operated oil fields in Kirkuk are now feeding privately run refineries in the Kurdistan region, in a new cooperative framework that could dramatically boost fuel supplies to areas of Ninewa province liberated from the Islamic State (IS) group.The deal represents deepening pragmatism between the Kurdistan Regional Government (KRG), Kirkuk province, and the federal government over how to best manage Kirkuk’s oil without becoming entangled in long-running […]

Oil companies bullish on Egypt, eyeing more investment, discoveries

15 Feb 2017   Egypt

Major international oil companies say they plan to step up their investments in Egypt, expecting to find more oil and gas now that ENI’s giant Zohr gas discovery has put its Mediterranean waters on the map. Once a net gas exporter, Egypt has turned into a major importer in recent years as growing domestic demand outstripped production, but the discovery of the 850 billion-cubic meter Zohr field in 2015 is expected to change that. The field is expected to come into production by the end of the year and will save Egypt billions of dollars in hard currency that would otherwise be spent on imports. The Egyptian government is also seeking to attract foreign investors as it seeks to transform itself into a gas trading hub for its own and other emerging Mediterranean producers. Marc Benayoun, chief executive of Italian energy group Edison, which is exploring areas near the […]

Eni, BP Pouring More Investment Into Egypt Than Anywhere Else

15 Feb 2017   Egypt

Eni SpA will start producing from the giant Zohr natural gas field off Egypt’s Mediterranean coast by the end of 2017 and plans to invest $10 billion in the North African country over the next five years, Chief Executive Officer Claudio Descalzi said. Production plans for Zohr are on schedule, and Egypt will be Eni’s top country for investment in the next two years, Descalzi said at a conference in Cairo. BP Plc, which bought a 10 percent stake in Zohr from Eni last year, invested more in Egypt in 2016 than in any other country and will do so again this year, the company’s CEO Bob Dudley said at the same event. “Some pretty good things are happening here for BP, like Eni,” Dudley said on Tuesday. “In 2016-17 we’re investing more money in Egypt than any country in the world, so this is important for us, we […]

Nigeria Loses Up to $100 Billion in Revenue as Attacks Cut Oil

15 Feb 2017   Nigeria

Nigeria said it lost out on as much as $100 billion in revenue last year as attacks by militants in the oil-rich Niger Delta cut crude output to a record low. Production fell by 1 million barrels a day to 1.2 million a day at the peak of the attacks, Emmanuel Kachikwu, minister of state for petroleum, said Tuesday in a video-clip on his Facebook page. Last year, Nigeria suffered its first full-year recession since 1991 as a resurgence of armed conflict in the delta, combined with lower oil prices, blighted the economy. While recent peace efforts have curbed the frequency of attacks on oil infrastructure, the West African nation has struggled to boost output as one of its largest export terminals remains closed. “We continue to engage,” Kachikwu said, referring to peace talks between the government and local leaders from the delta. “It is a difficult undertaking to […]

Trump Signs Measure Curbing Dodd-Frank Rules on Mining, Oil and Gas Companies

15 Feb 2017   USA

President Donald Trump signed a joint resolution in the Oval Office Tuesday rolling back part of the Dodd-Frank financial regulation overhaul that would require resource extraction issuers to report payments made to governments for the commercial development of oil, natural gas or minerals. Mr. Trump was seated at his desk, flanked by Vice President Mike Pence and members of Congress including Rep. Jeb Hensarling (R., Texas) and…

Mexico’s Pemex Sets Euro Corporate Debt Record with $4.49 Billion Issue

15 Feb 2017   Mexico

Mexico’s national oil company Petróleos Mexicanos issued €4.25 billion ($4.49 billion) in bonds Tuesday, the largest euro-denominated emerging market corporate bond deal on record. Emerging market investments have recovered from an initial slump after President Donald Trump’s November election victory. Mexican assets in particular sold off after Mr. Trump’s win, with the peso falling by as much as 16% against the dollar in the months…

Venezuela deputy president defies US over drug sanction

15 Feb 2017   Venezuela

Tareck el-Aissami (L) was supported by President Maduro (R) on Tuesday The vice-president of Venezuela has accused the US of “imperialist aggression” after it slapped sanctions on him for allegedly trafficking drugs. Tareck el-Aissami was described by the US treasury as a drug “kingpin” who worked with traffickers in Mexico and Colombia to ship drugs to America. Hitting back, he accused the US of “defamatory aggression”. Venezuelan President Nicolas Maduro demanded a public apology from the US for sanctioning his new deputy. The sanctions freeze Mr Aissami’s assets in the US and bar him from entering the country. He is seen as a powerful figure within the governing party and has been entrusted by Mr Maduro with key powers normally held by the president, such as determining ministerial budgets and expropriating private companies. The US treasury accuses him of being in the pay of convicted Venezuelan drug lord Walid […]

Electric car boom spurs investor scramble for cobalt

15 Feb 2017   Electric Cars

Investors are buying up physical cobalt anticipating that shortages of the metal, a key component of lithium-ion batteries used in electrical cars, will spur prices to their highest levels since the 2008 financial crisis. Prices for cobalt metal have climbed nearly 50 percent since September to five-year peaks around $19 a lb as stricter emissions controls boost demand for electric vehicles, especially in China, struggling with ruinous pollution levels in some cities. (For a graphic on how Lithium-ion battery works click tmsnrt.rs/2kOUBNQ ) Consultants CRU Group say electric car and plug-in hybrid vehicle sales could hit 4.4 million in 2021 and more than six million by 2025, from 1.1 million last year. By 2020, 75 percent of lithium-ion […]

U.S. gas prices remain relatively stable

15 Feb 2017   Prices, USA

Retail gasoline prices in the United States continue to hold steady despite regional fluctuations because oil markets in are limbo, a market survey found. Motor club AAA reports an average retail price for a gallon of regular unleaded gasoline at $2.28, only a fraction of a cent higher than the previous day and less than a percent, or about 2 cents, higher than one week ago. By region, the West Coast markets remains the most expensive in the country with California holding the honors of the state in the Lower 48 with the highest price for gas at $2.87 per gallon. AAA data indicates some price hikes may be in store for this market because of a decline in gasoline inventories and unplanned maintenance […]

Chesapeake Energy Settles With Estate of Former CEO

15 Feb 2017   USA

Chesapeake Energy Corp. and the estate of its former chief executive, the late Aubrey McClendon, have agreed to settle a legal dispute involving claims that Mr. McClendon stole sensitive documents from Chesapeake to start a rival company. The Oklahoma City-based company was seeking $445 million in damages from Mr. McClendon’s estate for the alleged theft of maps and data. The company said Mr. McClendon took that information with him…

Pope Francis wades into US oil pipeline dispute

15 Feb 2017   Pipelines

 Pope Francis has insisted that indigenous peoples must give prior consent for any economic activity on their ancestral lands – an indirect critique as the Donald Trump administration seeks to advance construction on a $3.8 billion oil pipeline over opposition from American Indians. Francis met Wednesday with representatives of indigenous peoples attending a U.N. agricultural meeting in Rome. He said the key issue facing them is how to reconcile the right to development with protection of their cultures and territories. He said “the right to prior and informed consent” should always prevail especially “when planning economic activities which may interfere with indigenous cultures and their ancestral relationship to the Earth.” The Cheyenne River and Standing Rock Sioux tribes are suing to stop the Dakota Access project.

EU gets wake-up call as Gazprom eyes rival TAP pipeline

15 Feb 2017   Europe, Pipelines

A general view shows the headquarters of Gazprom in Moscow, Russia, June 30, 2016. Gazprom’s bid to tap into a pipeline meant to wean Europe off Russian gas threatens to undermine a pillar of European energy policy and slow plans to develop rival deposits in the east Mediterranean. As the European Union struggles against the “iron embrace” of Russian pipelines, it has made opening a new Southern GasCorridor to carry gas from Azerbaijan by 2020 a priority. The 10 billion cubic meter (bcm)-capacity Trans Adriatic Pipeline (TAP) is the project’s end piece, joining up with the Trans Anatolian Pipeline at the Turkish border, then crossing Greece and Albania to reach Italy. Construction work on TAP gives EU officials the first non-Russian gas pipeline to supply Europe since Algeria’s Medgaz link nearly a decade ago, paving the way for diluting Gazprom’s large one-third share of Europe’s gas market. That at […]

Norway heralds new North Sea production

15 Feb 2017   Norway

The start of new production in the North Sea is a testament to the enduring strength of Norway’s energy sector, the country’s energy minister said. Norwegian Energy Minister Terje Soviknes was on hand for the official launch of the Ivar Aasen field in the country’s territorial waters in the North Sea. Ivar Aasen, operated by Norwegian group Aker BP, has a total cost framework of $3.3 billion and could be in service for the next 20 years. “The development of Ivar Aasen is an important milestone for the oil industry, and represents significant values for the Norwegian society,” the minister said in a statement . Aker BP started formal production at the Ivar Aasen field in December. The field has a peak production capacity of […]

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

15 Feb 2017   Russia

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

What Oil Crisis? Arctic Drilling Off Norway Set for Record

15 Feb 2017   Norway

Explorers look set to drill a record number of wells in Norway’s Arctic waters this year, undeterred by oil prices apparently stuck below $60 a barrel. After making a discovery of as much as 100 million barrels of oil in the Barents Sea, Lundin Petroleum AB said on Monday that it wants to squeeze two more exploration wells into its program this year, even if it means hiring an additional rig . That could push the total number of wells in the area to 16, two more than the record in 2014, according to forecasts from the Norwegian Petroleum Directorate, the industry regulator, and Rystad Energy AS, an Oslo-based consulting firm. The Norwegian Barents may contain as much as half the country’s unexplored resources, according to the NPD. Yet with crude still trading at half the highs it reached in 2014, the record drilling campaign sounds counter-intuitive. Elsewhere in […]

France’s Total looks further downstream in effort to ease looming supply glut

15 Feb 2017   France

France’s Total is looking to invest in energy projects further downstream than their upstream and LNG production facilities, the company’s President of Gas Laurent Vivier said Tuesday. The strategy is a logical change given the current tough environment for final investment decisions for new greenfield LNG production projects, according to Vivier. What some industry observers are underestimating is the pace that new buyers can enter the market, as Total’s interests in two recently announced LNG import projects in the Ivory Coast and Pakistan would require a combined 9 million mt/year and will start receiving LNG in 2018, Vivier said. Both projects would allow for quick entrance into the market, utilizing FSRUs from Golar LNG and Hoegh LNG respectively, he said. “We are now ready to invest downstream in the value chain,” Vivier added. Last November, a consortium led by Total was awarded the rights to build and operate an […]

Oil Prices Head Lower In Spite Of Bullish OPEC Data

14 Feb 2017   Prices

Oil is charging lower to start the new week, as the monthly OPEC oil market report has done little to assuage oversupply concerns – despite the cartel’s proclamations of production cut compliance and upward revisions to oil demand growth. Hark, here are five things to consider in oil markets today: 1) Even though Russia is apparently cutting production, it is still set to boost exports of Urals, its medium sour grade . Russia’s Energy Minister Alexander Novak has been keen to point out that although Russia is cutting production, it is not cutting exports. The Russian Energy Ministry has further endorsed this notion, confirming exports via Transneft’s pipeline system in January were up 114,000 bpd from December’s level. As our ClipperData illustrate below, export loadings of Urals averaged 2.6 million barrels per day in 2016, up 16 percent versus the year prior. Loadings last month also held above 2.6 […]

Oil prices dip as markets remain bloated despite OPEC-led cuts

14 Feb 2017   Prices

Oil prices dipped on Monday on signs that global fuel markets remained bloated despite OPEC-led crude production cuts that have been more successful than most initially expected. Brent crude futures were trading at $56.55 per barrel at 0035 GMT, down 15 cents from their previous close. West Texas Intermediate (WTI) crude futures were down 12 cents at $53.74 a barrel. The Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia have agreed to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017 in a bid to rein in a global fuel supply overhang. There was widespread scepticism that all producers would actually make the promised cuts, but compliance with the announced reductions is now estimated to be around 90 […]

Artificial Intelligence To Reveal The Biggest Secret In Oil

14 Feb 2017   Oil Supply

The EIA is, and will continue to be, the gold standard for reporting U.S. oil inventories, and the administration’s weekly reports have the power to immediately swing crude oil prices depending on builds or draws in oil stocks. But while the U.S. is a transparently reporting country, other nations are not revealing oil stocks data, or are rarely reporting—at best—opaque figures in which the markets have little faith. No one really knows how much oil the countries around the world are storing, creating uncertainty in the supply side of the oil markets. But one of the hottest new technologies may shed more light on oil storage around the globe, especially in countries that are keeping inventory figures to themselves. The tech is artificial intelligence (AI) – and an unlikely collocation to put in a sentence with oil and inventories. Yet, U.S. geospatial analytics company Orbital Insight has been using […]

Investor Honeymoon With OPEC Falters as Shale Drilling Booms

14 Feb 2017   OPEC, Prices

IEA Sees OPEC Achieving 90% Production Cut Compliance There are limits to investors’ love affair with OPEC. After unprecedented optimism that the Organization of Petroleum Exporting Countries will manage to ease a global supply glut, money managers reduced their bets on rising West Texas Intermediate prices for the first time in a month. While the group and other major exporters are pumping less crude, U.S. inventories and production are on the rise, and shale drillers keep adding rigs. The U.S. benchmark has traded mostly between $50 and $55 a barrel for the last two months. “There’s starting to be fatigue about the range we’ve been trading in,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy, said by telephone. “It won’t be summer until we break out to the upside.” OPEC achieved the […]

OPEC reports big Saudi oil cut, boosting compliance with deal

14 Feb 2017   Saudi Arabia

Top OPEC oil producer Saudi Arabia made a large cut in its crude output in January to support prices and lessen a glut, helping boost compliance with the group’s supply-reduction deal to a record high of more than 90 percent. The Organization of the Petroleum Exporting Countries is curbing its output by about 1.2 million barrels per day (bpd) from Jan. 1. Russia and 10 other non-OPEC producers agreed to cut half as much. Supply from the 11 OPEC members with production targets under the deal fell to 29.888 million bpd last month, according to figures from secondary sources that OPEC uses to monitor its output. OPEC published the data in its monthly report on Monday. […]

Oil output cuts working quicker than expected, signals Opec

14 Feb 2017   OPEC

Steep Opec production cuts could ease an oil market surplus quicker than expected in 2017, the oil cartel signalled in its first output assessment since a deal to curb supplies and bolster prices came into effect. After more than two years of allowing market forces to balance supply and demand, Opec in November agreed to again influence prices that had crashed in a manner that was far more severe than anticipated. A year of talks and diplomatic wrangling between ministers of Opec’s resource-rich economies that had been battered by the oil downturn led to the first supply cut deal since the financial crisis. Opec agreed to reduce its output by around 1.2m barrels a day starting in 2017. A calculation using the 13-member group’s January production numbers, which were published on Monday, suggested curbs of around 1.1m b/d from Opec’s October baseline numbers. This implies more than 90 per cent compliance in the first month of the six-month deal to tackle excess inventories.

OPEC 310,000 Barrels Per Day Above Production Cut Goal

14 Feb 2017   OPEC

The new January OPEC Monthly Oil Market Report is out with crude only production numbers for January 2017. All charts are in thousand barrels per day. (Click to enlarge) OPEC crude oil production dropped to 32,139,000 bpd in January. November production was revised upward by 68,000 bpd while December production was revised downward by 56,000 bpd. So Peak OPEC production was in November 2016 instead of December as they had it last month. Officially OPEC agreed to cut production by 1.2 million barrels per day beginning in January. So OPEC missed their mark by 310,000 barrels per day. (Click to enlarge) OPEC’s December production represents an all time high for the cartel. (Click to enlarge) Algerian production was down by 41,700 bpd. This was a lot more than was expected. (Click to enlarge) Angola’s production was down 23,200 bpd in January. (Click to enlarge) Ecuador’s production dropped 16,700 bpd […]

Oil Producers Comply With OPEC Deal to Cut Output, but for How Long?

14 Feb 2017   OPEC

When OPEC and other major oil exporters agreed late last year to limit production as a way to bolster teetering prices, many saw it as a shaky deal by a spent force. That perception, though, has changed. And oil prices are up 20 percent since the agreement was reached.