Barclays: Expect $51 Oil This Year (28 March 2018): By Damir Kaletovic - As oil continues to pair Monday gains on soaring U.S. crude inventory, Barclays is calling a $51-per-barrel price on WTI by the third and fourth quarters of this year, and expects Brent to fall to $57 by the end of the year. The bank forecast that West Texas Intermediate prices will fall to $58 in the second quarter, before continuing their decline. Recently, the oil market has been supported by supply disruption concerns, emanating most prominently from the Middle East.
Oil Prices Fall As EIA Confirms Inventory Build (28 March 2018): By Irina Slav - After a surprise 5.32-million-barrel inventory build reported by the American Petroleum Institute (API) weighed on oil prices yesterday, the Energy Information Administration (EIA) is reporting a build of 1.6 million barrels for the week ending March 23. The markets, which have not had a chance to react to the EIA report as of the time of writing, could ease their downward trend given the nearly 4-million difference in build in the official figures. (Source: Oil Price)
Is This The World’s Next Petrochemical Hub? (26 March 2018): By Irina Slav - Appalachia is about to turn into the largest gas-producing region in America, accounting for 37 percent of the total by 2040, a study by IHS Markit commissioned by a lobby group has suggested. The group, dubbed Shale Crescent USA, is on a mission to promote the attractive business conditions for petrochemical producers in a bid to find a replacement for coal as a revenue stream in the region. (Source: Oil Price)
Abu Dhabi awards $3.5bn in contracts to Samsung Engineering to boost refining capabilities (26 March 2018): Jennifer Gnana - Abu Dhabi National Oil Company (Adnoc) awarded two contracts to South Korea’s Samsung Engineering worth $3.5 billion to help process other crude grades as the company looks to free up its flagship Murban grade for export markets. The first contract worth $3.1bn will enable Samsung to process 420,000 barrels per day of crude sourced from the offshore Upper Zakum concession, and grades of a similar nature from the market, Abu Dhabi National Oil Company said in a statement. The second $473m contract will recover power and water and is set to generate 230MW electricity and 62,400 cubic metres of water per day by capturing waste heat using closed-cycle power generation technology. (Source: The National (UAE))
China Prepares Death Blow To The Dollar (24 March 2018): By ZeroHedge - On March 26 China will finally launch a yuan-dominated oil futures contract. Over the last decade there have been a number of “false-starts,” but this time the contract has gotten approval from China’s State Council. With that approval, the “petroyuan” will become real and China will set out to challenge the “petrodollar” for dominance. Adam Levinson, managing partner and chief investment officer at hedge fund manager Graticule Asset Management Asia (GAMA), already warned last year that China launching a yuan-denominated oil futures contract will shock those investors who have not been paying attention. (Source: Oil Price)
Downstream Open House: Shell gives profitable growth outlook as Downstream business transforms (23 March 2018): Royal Dutch Shell plc (Shell) today updated investors on its Downstream growth ambitions, underlining the important role they will play in delivering Shell’s world-class investment case. “Our unique Downstream business is fundamental to delivering a world-class investment case,” said Chief Executive Officer Ben van Beurden. “Its unparalleled breadth, depth and the strength of our brand make our Downstream business highly competitive, helping to generate strong free cash flows and returns while making Shell more resilient over the coming decades.” (Source: Hydrocarbon Processing)
U.S. Electricity Sales Fall Again (22 March 2018): By Leonard Hyman & William Tilles - Well, it happened again. 2017 was another down year for the US electric utility industry--despite a reasonably robust economy and increasing population. The 2.1 percent drop was bigger than usual. For those paying attention this should not come as news. In seven of the past ten years, electricity generation in the U.S. has declined. And in six of the past ten years kilowatt hour sales declined as well. Sales to all three types of energy consumers—residential, commercial and industrial—fell off. What do these poor numbers in the face of a booming economy indicate for the future? (Source: Oil Price)
Fire extinguished at fuel oil storage tank in Singapore (21 March 2018): SINGAPORE, (Reuters) - A fire that had broken out at an oil storage tank at Tankstore's Pulau Busing terminal in Singapore on Tuesday evening was extinguished after six hours, the Singapore Civil Defence Force (SCDF) said on Wednesday. "After approximately 6 hours of intense firefighting operations, the raging oil storage tank fire was extinguished," the SCDF said on its Facebook page. The cause of the fire is not yet known and is under investigation, an SCDF spokesman told Reuters on Wednesday. (Source: Hydrocarbon Processing)
Dubai to tender Gulf's first hydroelectric power plant in June (20 March 2018): Jennifer Gnana - Dubai will tender the Arabian Peninsula’s first hydroelectric power project located in the mountainous enclave of Hatta in June, the emirate’s utilities chief said on Monday. "Firstly, we’ll finish the engineering part. By June, we’ll tender the project. [It will be an] international tender,” Saeed Al Tayer, chief executive at Dubai Electricity and Water Authority told The National. Mr Al Tayer was speaking to reporters on the sidelines of the groundbreaking ceremony for the 700MW fourth phase of the Mohammed bin Rashid Al Maktoum solar park in the Seih Al Dahal desert to the south of Dubai. (Source: The National UAE)
Trump Bans Venezuela’s Oil-Backed Cryptocurrency (19 March 2018): By ZeroHedge - Cryptos are moving sharply lower in response to news that President Trump has issued an executive order banning the U.S. purchases of the "Petro", the cryptocurrency which was infamously rolled out by the Venezuelan government; the order comes as part of a campaign to put more pressure on the government of President Nicolas Maduro. (Source: Oil Price)
Canada Is Facing A Heavy Crude Crisis (16 March 2018): by Tsvetana Paraskova - Canada’s benchmark heavy crude oil widened its discount to WTI to the largest in six trading sessions on Thursday, as additional storage capacity in Alberta and data about lower crude-by-rail shipments added concerns over the domestic oil glut, as TransCanada’s Keystone Pipeline has yet to return to normal pressure levels following a leak and temporary shutdown last November. On Thursday, Western Canadian Select was trading at a discount of US$27 a barrel to WTI. The discount widened to the biggest level, US$30.55 a barrel, in four years on February 5, after a selloff following the temporary shutdown of Keystone in mid-November. (Source: Oil Price)
McDermott & CB&I receive competition authority approvals for proposed combination (15 March 2018): HOUSTON, Texas – McDermott International, Inc. and CB&I announced that the companies have received antitrust clearance in Russia for their proposed combination. With this clearance, McDermott and CB&I have received all the required competition authority approvals for the transaction. As previously announced on December 18, 2017, McDermott and CB&I agreed to combine in an all-stock transaction to create a premier vertically-integrated onshore-offshore company with an enterprise value of approximately $6 billion. Under the terms of the proposed combination, upon completion, it is estimated that McDermott stockholders will own approximately 53 percent of the combined company on a fully diluted basis and CB&I shareholders will own approximately 47 percent. (Source: Hydrocarbon Processing)
Exclusive: Borouge eyes expansion on the back of Adnoc's downstream strategy (14 March 2018): Jennifer Gnana - Borouge, the UAE’s biggest petrochemical producer, will look to collaborate with part-owner Abu Dhabi National Oil Company on its new downstream strategy with an eye on expansion in its core markets, its chief executive said on Wednesday. "The market is open for us, mainly it will be again our traditional markets - Asia, Africa of course and Middle East. We have a presence in Africa but we’re going to expand of course. We have some sales there, but our ambition is to grow in Africa,” Ahmed Abdulla, said in an interview with The National.
OMV to spend 10B euros in shift towards gas, refining (13 March 2018): VIENNA, (Reuters) - Austrian energy group OMV is ready to spend 10 billion euros to focus more on gas and value-added refined products and grow its business outside Europe, its CEO said on Tuesday. As other energy companies shift their portfolios towards natural gas as a less polluting alternative to oil, OMV said it too will beef up its gas exploration, refining and transport business, aiming to become one of Europe's top players in the market. The partly state-owned group operates refineries in Austria, Germany and Romania and explores oil and gas fields in central and eastern Europe, the North Sea and the Middle East and Africa.
Another Oil-Backed Cryptocurrency Launches (13 March 2018): By Tsvetana Paraskova - New York-based investment and holding company Signal Capital Management said on Monday that it had launched a cryptocurrency backed by oil and gas reserves in what it says is the “world’s first globally compliant” oil-backed digital currency. The new digital currency, PetroDollars, will be backed by the underlying value of recoverable reserves of crude oil and equivalents such as natural gas and condensates, and related assets. (Source: Oil Price)
China says trade war with U.S. will only bring disaster to global economy (11 March 2018): Elias Glenn - BEIJING (Reuters) - Any trade war with the United States will only bring disaster to the world economy, Chinese Commerce Minister Zhong Shan said on Sunday, as Beijing stepped up its criticism on proposed metals tariffs by Washington amid fears it could shatter global growth. After pressure from allies, the United States has opened the way for more exemptions from tariffs of 25 percent on steel imports and 10 percent on aluminum that U.S. President Donald Trump set last week.
Britain’s Wood wins contract with Saudi Aramco and SABIC (9 March 2018): Noor Nanji - British energy services provider Wood Group has been awarded a new contract to develop the world’s largest fully integrated crude oil to chemicals (COTC) complex in Saudi Arabia, on behalf of Saudi Aramco and SABIC. Wood Group will provide front-end engineering design and project management services during the engineering, procurement and construction phase. The company will also support the development of the $20 billion complex which is expected to process 400,000 barrels per day and 9 million tons of chemicals and base oils annually. (Source: The National (UAE))
London’s last chance to win $2 trillion Aramco prize (8 March 2018): Herman Wang - Saudi Arabia must decide soon where to list its crown jewel state oil company Aramco, if it’s to meet the schedule for an initial public offering (IPO) in 2018. The London Stock Exchange (LSE) is a front-runner to play host to the world’s largest single producer of crude but faces stiff competition from New York and Hong Kong. The pressure will be on the government of Prime Minister Theresa May to woo Saudi Arabia's Crown Prince Mohammed bin Salman during his current visit to the UK. Capturing the listing, which could value Saudi Aramco at $2 trillion, would bolster London’s importance as a global financial centre at a time when the Brexit decision to leave the European Union has seen its status challenged. (Source: The National (UAE))
IEA Does Not Believe Steel Tariffs Will Affect Global Oil Trade (7 March 2018): By Zainab Calcuttawala - The International Energy Agency’s (IEA) leadership does not believe President Donald Trump’s tariffs on imported aluminum and steel will affect the global oil trade. “I think the impact on the global oil markets will be limited if any,” Executive Director Fatih Birol told CNBC during the ongoing CERA Week conference in Houston. “We may see some impact. There is major infrastructure construction in Texas, lots of pipelines. We do not know the [tariff] proposal yet in detail, but if there are some cost implications, this may cause some changes in the plans. But I don’t see this causing major changes in global oil markets.” (Source: Oil Price)
Nigeria Can Produce Oil At $20 A Barrel (6 March 2018): By Irina Slav - The Nigerian National Petroleum Corporation can produce crude oil at around US$20 a barrel, but there are plans to bring this even lower, to US$15 a barrel, the company’s group managing director Maikanti Baru told media. "The more we bring down the cost, the more the money that comes to the federal government and into the pockets of state and local governments," Baru said. Nigeria has pledged to keep its oil production at 1.8 million barrels daily after OPEC asked it to join the cut efforts to bring down the global inventory overhang. (Source: Oil Price)
Ending the LNG Drought (5 March 2018): By Nikos Tsafos - Investment in new projects to produce liquefied natural gas (LNG) fell sharply in 2016 and 2017: the industry-sanctioned under 10 million tons of annual capacity in two years, an 80 percent reduction relative to 2011–2015. This slowdown raises many questions. Is the industry investing enough to meet future demand, and if not, will that lead prices to spike later? Governments are asking whether they should offer concessions to support projects; and if so, how far should they go, especially given pressures from constituents who were promised jobs, investment, and revenue from projects that are now stalled. And at a geopolitical level, strategists are asking what places will win and what places will lose—and with what consequences? What might the world’s energy map look like in 10 or 20 years? (Source: Hydrocarbon Processing)
Oil majors get serious on 'new energy' investments (4 March 2018): Robin Mills - In the late 1990s, international oil companies all wanted to be like Enron. The flashy Texas firm had shaken up the staid energy world with its ventures into gas and electricity trading, broadband, solar power, and the US’s then largest wind turbine developer. That desire faded somewhat after Enron’s ignominious 2001 collapse. But almost two decades later, new energy is again on the agenda for the world’s oil supermajors. (Source: The National (UAE))
Actually, Trade Wars Aren't Good (For Oil, Anyway) (2 March 2018): By Liam Denning - Trade wars are good" is a thing you may have read Friday morning that happens to be not true. Yet, having emanated from the Tweeter-in-Chief, and with swinging steel and aluminum tariffs apparently on the way, here we are. For oil and gas producers, more expensive metal doesn't seem particularly favorable as outcomes go. But there's a macro problem, too. Back when President Donald Trump was elected, I was concerned about the potential for a trade war developing. We aren't there yet, despite the Twitter-rattling. But I think we can all agree we're a tad closer heading into the weekend. (Source: Bloomberg)
Russian Hackers Target U.S. Energy Infrastructure (2 March 2018): By Tsvetana Paraskova - Russia has been trying to interfere with U.S. energy markets and influence U.S. energy policy by using Russian operatives to troll social media platforms with divisive and inflammatory posts, a report by House Republicans has revealed. The report—issued by the United States House of Representatives Committee on Science, Space, and Technology—includes examples of Russian-propagated content on Facebook, Twitter, and Instagram, targeting U.S. energy markets and domestic energy policy. (Source: Oil Price)
Petrofac swings to loss due to $372m impairment charges (1 March 2018): Jennifer Gnana - Bloomberg - Petrofac, the London-listed oilfield services firm with offices in Sharjah, swung to a loss in 2017 due to impairments amounting to $372 million, despite a strong performance from its engineering and construction wing on the back of project awards in the Middle East. Net loss in 2017 stood at $29m, compared with a profit of $1m in 2016, the company said in a filing to the London Stock Exchange. Revenue fell 19 per cent to $6.39 billion from $7.87bn a year earlier. Petrofac, which undertakes upstream and downstream works in the UAE, Oman, Iraq and Kuwait, saw its business performance profit rise 7 per cent to $343m in 2017, before impairment charges, the company said in its full-year results. (Source: The National (UAE))