Oil Theft Around The World: Cartels And Exploding Donkeys (31 May 2017): By Zainab Calcuttawala - Thousands of miles of oil pipelines connect the world’s oil producing hubs to their key customers’ refineries and electrical grids. By replacing trucks, the advent of the pipeline has dramatically reduced the carbon emissions associated with transporting fuel from point A to point B, but their unattended nature makes them an attractive target for thieves who could refine and sell the products for rock-bottom prices on the black market or other illicit venues.
Iran Signs Oil For Goods Deal With Russia: Breaks Free Of Petrodollar (29 May 2017): By ZeroHedge - Iran signed an agreement with Russia under which it has broken free from the petrodollar, and will "sell", or rather barter crude oil to Russia in exchange for products. The announcement was made by Iran’s Oil Minister Bijan Zanganeh, as reported by Russia’s RIA and TASS news agencies.
Great and growing potential in green finance (29 May 2017): Karim Nassif - Green finance has quickly become an effective tool in the global push to develop and fund clean energy solutions. With governments around the world focused on lowering carbon emissions, sustainable financing options are an increasingly popular mechanism in the pursuit of achieving climate change targets.
Long drawn out battle for Opec with oil balance (28 May 2017): Robin Mills - Opec did too good a job managing expectations ahead of its latest meeting in Vienna, which concluded on Thursday. The extension of the deal by nine months, rather than six, was so clearly flagged that oil prices fell 5 per cent on its announcement.
Uzbekistan To Increase Its Refining Capacity By 50% (27 May 2017): By Eurasianet - Uzbekistan revealed in late April that it had begun building a new $2.2 billion oil refinery that would produce fuel for sale domestically and abroad.
How Close Are Kurds To Establishing Full Independence? (27 May 2017): By ISN Security Watch - OK, so how close are Iraqi Kurds to establishing their own independent state in Northern Iraq? In this article, Gallia Lindenstrauss and Adrien Cluzet analyze the myriad factors that have to be addressed if a truly autonomous or South Sudan-like homeland is to appear. In all cases, our authors are confident that such an entity would be pro-Western, have a favorable attitude towards Israel, and remain lukewarm to the idea of creating a Greater Kurdistan.
Shell announces start of deepwater production at newest FPSO in Santos basin (26 May 2017): THE HAGUE -- Royal Dutch Shell plc, through its subsidiary BG E&P Brasil Ltda. (Shell) and consortium partners in Lula South, announce today that deepwater production has started at the FPSO P-66, which is located in the Brazilian pre-salt of the Santos basin.
OPEC ponders how to co-exist with U.S. shale oil (26 May 2017): By Ernest Scheyder | VIENNA - First, they ignored each other. Then, they went into a bruising fight. Finally, they are talking, albeit with opposing agendas. The history of the relationship between OPEC and the U.S. shale oil industry has evolved a great deal since the cartel discovered it had a surprise rival emerging in a core market for its oil around five years ago.
Photo Courtesy of Chevron.
South Africa wants Sinopec to retain refinery capacity (25 May 2017): CAPE TOWN (Reuters) — South Africa is in talks with China's Sinopec about its takeover of Chevron Corp's Cape Town refinery as it wants to ensure its production capacity is retained and enhanced, Economic Development Minister Ebrahim Patel said on Thursday.
OPEC, Allies to Extend Oil Cuts for Nine Months to End Glut (25 May 2017): by Nayla Razzouk, Golnar Motevalli, and Laura Hurst - OPEC and its allies extended oil production cuts for nine more months after last year’s landmark agreement failed to eliminate the global oversupply or achieve a sustained price recovery.
DONG Energy to sell oil, gas business to Ineos for $1.3 B (24 May 2017): COPENHAGEN (Reuters) — Danish utility and offshore wind farm developer DONG Energy has agreed to sell its oil and gas business to petrochemicals firm Ineos for $1.3 B, it said on Wednesday, the latest in a string of North Sea deals.
China Opens Up To Foreign Investment In Oil Sector (24 May 2017): By Oil & Gas 360 - China has said it will allow private companies to invest in the country’s oil and gas storage sector, the government said in a document laying out changes it plans to make to the energy sector.
WorleyParsons signs framework agreement with Shell for EPCM services (23 May 2017): WorleyParsons announces today that it has been awarded a 5-yr Framework Agreement by Shell Global Solutions International, B.V., for the provision of engineering, procurement and construction management (EPCM) services for Shell downstream projects worldwide.
Trump Proposes Selling Off Half U.S. Strategic Oil Reserve (23 May 2017): by Catherine Traywick and Jennifer A Dlouhy - The White House plan to trim the national debt includes selling off half of the nation’s emergency oil stockpile and the entire backup gasoline supply, part of a broad series of changes proposed by President Donald Trump to the federal government’s role in energy markets.
Wood Group secures contract with Sakhalin Energy (22 May 2017): ABERDEEN -- Wood Group has secured a technical support services (TSS) contract with Sakhalin Energy Investment Company (Sakhalin Energy), an operator of Sakhalin-2; one of the world’s largest integrated oil and gas projects, that includes Russia’s first offshore gas production platform and liquefied natural gas (LNG) plant.
Oil Review Africa weekly digest - 15th - 19th May (22 May 2017): Solo Oil announces helium acquisition in Tanzania and Ruvuma gas progress. Solo Oil has acquired a 10 per cent interest in Helium One Limited and announced plans to progress further with the Ruvuma gas field, increasing its presence in Tanzania...
Fossil fuel industry faces disruption, but not so fast (21 May 2017): Robin Mills - ‘No more petrol or diesel cars, buses, or trucks will be sold anywhere in the world within eight years." Such a vision, if well-founded, would indeed scare the oil and traditional vehicle industries, with the prospect of a collapse in demand. Yet The Telegraph’s breathless summary of a report by Tony Seba, a Stanford University economist, matches much other uncritical and hyperbolic commentary.
OPEC heads towards supply cut extension as Saudi signals most on board (21 May 2017): By Reem Shamseddine and Marwa Rashad | RIYADH - OPEC and other oil producers are on course to agree an extension of supply cuts at a meeting on Thursday, with Saudi Arabia saying most participants are on board with the plan to rein in a global supply glut.
OPEC Pushes Up Oil, But Will The Gains Continue? (19 May 2017): By Tom Kool - May 19,Oil prices broke the $50 mark in trading on Friday, suggesting that the OPEC deal extension rumors are still influencing markets. The rally stemming from the announcement of Saudi Arabia and Russia on a nine-month extension seemed to have run its course by mid-week, but oil moved higher again on Friday. WTI rose above $50 for the first time in nearly a month.
Halliburton launches drilling operations for Lukoil at Vostochno-Taimyrsky (19 May 2017): HOUSTON -- Halliburton Company has announced that it launched drilling operations in the Zhuravlinaya area of the Vostochno-Taimyrsky license block for Lukoil in early April. The project involves Halliburton constructing a 5,500-m exploration well, in addition to delivering an integrated service package which includes directional drilling, drill bits, drilling fluids, well cementing and other services. The project is well underway and ahead of schedule.
Oil Prices Rise As OPEC Discusses Deeper Output Cuts (19 May 2017): By Irina Slav - OPEC is discussing a potential deepening of crude oil output cuts in a bid to accelerate market rebalancing, sources from the cartel told Reuters. The news came as the group’s Economic Commission Board met to discuss possible scenarios for next week’s meeting in Vienna. Expectations are that the meeting will yield a consensus agreement on an extension of the cuts, but this is the first time a potential deepening is also being mentioned.
Image from Carnarvon
China in gas hydrate find (18 May 2017): Written by Karen Boman - Mined flammable ice, or natural gas hydrates, have proved successful in the Shenhu area of the South China Sea. The mining of gas hydrates marks a major breakthrough that could lead to a global energy revolution, says China’s Minister of Land and Resources Jiam Daming.
‘’Too Big To Hedge’’ Goldman Explains The Rationale Behind The OPEC Deal (18 May 2016): By Nick Cunningham - The key for OPEC in balancing the oil market is to flip the futures curve. Goldman Sachs warned that until the oil futures market moves decidedly into a state of backwardation, OPEC could struggle to significantly drain inventories. As it stands, the market contango – a situation in which near-term oil futures trade at a discount to deliveries six or twelve months out – allow shale drillers to hedge their future production and lock in higher prices for delivery at a later date.
Adnoc looks to expand base oil market for its Ruwais plant (17 May 2017): Anthony McAuley - Adnoc has signed a deal with Penthol to sell high-specification base oil from its refinery in Ruwais, opening a new market for the product in the US. The deal is for an unspecified amount of Group III base oil of which Adnoc is targeting production of 500,000 tonnes a year, together with 100,000 tonnes of Group II base oil. The products meet US and European environmental specifications for oil that is further refined into lubricant.
Is This The Beginning Of The End For Gasoline In Asia’s Largest Markets? (17 May 2017): By Haley Zaremba - As the rise of electric cars looms ever larger on the horizon for India and China, far-reaching implications for the global oil market are impending. Oil and auto executives are well aware of the coming change, warning refiners to prepare for a future where gasoline is not their primary source of revenue.
China's Norinco and Saudi Aramco form $10-B refinery plan (16 May 2016): BEIJING (Reuters) — Chinese defense conglomerate China North Industries Group Corp (Norinco) has signed a framework agreement with state-run oil company Saudi Aramco to build a refinery and chemicals complex in northeast China.
Goldman’s Two Conditions For A Successful OPEC Deal (16 May 2017): By ZeroHedge - Goldman, which has been pushing for higher oil prices with seemingly daily bullish research reports for the past month, underwrote the last Saudi Arabian bond issue and is expected to manage the Aramco IPO (explaining the bank's conflict of interest), released a note commenting on the latest development in the oil market. A note which sent the price of crude higher by 3 percent after Saudi and Russia oil minister agreed to extend the OPEC production cuts by another 9 months through the end of Q1 2018. Specifically, Goldman writes that "today’s announcement will likely further extend the oil price rebound started last week on decent stock draws and low positioning, although the rally so far today has remained modest compared to the move that occurred last year when the OPEC cuts were first announced."
Photo Courtesy of Nghi Son Refinery and Petrochemical LLC.
Start-up of Vietnam's Nghi Son oil refinery delayed to 2018 (15 May 2017): SINGAPORE/HANOI (Reuters) -- The commercial start-up of Vietnam's new $7.5 B Nghi Son oil refinery will be delayed to 2018, from an initial expected start-up in the third quarter of this year, according to a notice on a government website. The 200,000 bpd oil refinery is now planning to start commercial operations in the Q1 2018, according to a notice on the website for Deputy Prime Minister Vuong Dinh Hue and a source close to the matter.
Oil Jumps As Saudis And Russians Agree To Extend OPEC Deal Into 2018 (15 May 2017): By Irina Slav - What Saudi Arabia’s Oil Minister said in March will not happen, has happened: in a joint statement, Khalid al-Falih and his Russian counterpart Alexander Novak said that OPEC and Russia have agreed to extend the oil production cut deal struck at the end of last year until March 2018.
Oil falls as focus shifts to all that output OPEC can't control (12 May 2017): By MARK SHENK - NEW YORK (Bloomberg) -- Oil fell as investors focus on all the production that OPEC can do nothing about. Futures declined as much as 1% in New York, trimming the first weekly gain in a month. The Organization of Petroleum Exporting Countries boosted estimates for growth in rival supplies by 64%, as producers in the U.S. shale patch, Brazil and elsewhere keep boosting production.
Adnoc eyes growing China demand for high-grade plastics (11 May 2017): Mahmoud Kassem - UpdAbu Dhabi National Oil Company (Adnoc) said yesterday that it was ramping up production of high-grade polymer products to meet demand from China’s car industry as well as the country’s investment in gas and electricity infrastructure.
Solar Power To Threaten Conventional Power By 2020 (11 May 2017): By Leonard Hyman & William Tilles - Researchers project that solar power will become cheaper than conventional, fossil fueled electric generating sources by 2020. (The researchers do not say that directly, but their numbers do.) But the news gets even worse for incumbent utilities. By 2030, solar-plus-storage could threaten the economic relevance of their distribution grids by making less necessary the connection with the local electric utility.
Oil Prices Jump On Bullish Inventory Data, Saudi Export Cuts (10 May 2017): By Matt Smith - After yesterday's monthly EIA report, and tomorrow's monthly OPEC report, the weekly EIA inventory report acts as the filling in this energy data sandwich. While have to wait until next Tuesday (16th) to get the IEA's monthly offering, hark, here are five things to consider in oil markets today:
Tesla’s Solar Roof Is Finally Ready For You to Buy (10 May 2017): by Tom Randall - Tesla will begin with production of two of the four styles of solar tile unveiled in October: a smooth glass and a textured glass version. The Tuscan and French slate tiles will be available by the end of this year. The company will accept orders from around the world, though overseas deliveries won't begin until next year.
Malaysia's Petronas gets flexible on LNG contracts as supply builds (9 May 2017): KUALA LUMPUR (Reuters) -- Malaysia's state energy firm Petronas may try shorter-term LNG contracts and smaller cargo sizes to entice buyers, senior company officials said, at a time when it has major contracts coming up for renewal and the market is awash in supply.
Japan reports successful gas output test from methane hydrate (8 May 2017): TOKYO (Reuters) -- Japan's trade ministry on Monday reported success in producing gas last week by extracting methane gas from methane hydrate deposits offshore Japan's central coast. The tests being run at two different wells are the first since 2013, when Japan achieved the world's first-ever extraction of gas from offshore deposits of methane hydrate, a frozen gas known as "flammable ice."
Saudi Oil Minister: OPEC Output Cut Could Extend Into 2018 (8 May 2017): By Irina Slav - The production cut agreement that OPEC closed last year in a bid to improve oil prices could be extended for more than six months, Saudi Arabia’s Oil Minister Khalid al-Falih said at the Asia Oil and Gas Conference that opened today in Malaysia.
The role energy can play in the fourth industrial revolution (7 May 2017): Robin Mills - ‘I sell here, sir, what all the world desires to have – power." So said the British steam engineer and pioneer Matthew Boulton in 1776, on the cusp of the first industrial revolution. Now, is the fourth industrial revolution, proclaimed by futurists, going to transform the energy industry? The first industrial revolution was made from steam, coal and iron; the second from oil, the internal combustion engine and electricity; and the third from electronics and the internet. The fourth, if it truly emerges, may draw on some or all of 3D printing, robotics, artificial intelligence, biotechnology, nanotechnology, wonder materials such as graphene, the Internet of Things and advanced energy.
Crude prices fall amid high inventories and concerns over China (6 May 2017): Catherine Ngai - The plunge in crude oil markets this past week to a six-month low was is likely to have been driven by worries about Chinese economic growth, persistently high inventories and fund positioning. Brent crude fell below US$50 on Thursday for the first time since late March but gained back some ground on Friday to close at $49.10. Its loss for the week amounted to 5 per cent.
Suddenly, Oil Below $40 a Barrel Doesn’t Seem So Far-Fetched (5 May 2017): by Alex Nussbaum - It’s come to this for the beleaguered oil market: a big bet that prices are about to sink to their lowest level in more than a year. About $7 million worth of options changed hands Friday that will pay off if West Texas Intermediate crude falls beneath $39 a barrel by mid-July, according to data compiled by Bloomberg. WTI, which hovered around $46 Friday, hasn’t traded below $39 since April 2016, though it’s been dropping like a stone in recent weeks.
Pemex seeks investors for its refineries, but who's buying? (5 May 2017): NEW YORK/MEXICO CITY (Reuters) -- Sweeping energy reforms have turned Mexico into one of the world's most attractive offshore prospects, but one segment is getting no love from US investors: the nation's aging refineries.
Five Charts That Explain Crude Oil's Sudden Nosedive Toward $45 (5 May 2017): by Alex Longley - Thursday’s collapse in oil prices brought with it big shifts to many of the indicators that analysts follow as they try to figure out where the market’s headed next. Here are five charts monitoring many of those key barometers. In them, a trend emerges: capitulation.
Iran To Raise Oil Output At Oil Field It Shares With Saudi Arabia (4 May 2017): By Irina Slav - The Iranian Offshore Oil Company will increase production at the Foroozan oil field, which Iran shares with Saudi Arabia, by 12,000 barrels daily, the company’s executive director told Iranian media, adding that it will install two platforms at the field soon.
Photo Courtesy of Reuters.
US agency: Weak safety standards led to Exxon refinery blast (4 May 2017): HOUSTON (Reuters) -- The US Chemical Safety Board (CSB) has concluded that a 2015 explosion at a Torrance, California, refinery then owned by ExxonMobil Corp could have been prevented, the agency concluded in a report issued on Wednesday. "This explosion and near miss should not have happened," said CSB Chair Vanessa Allen Sutherland in a statement. "The CSB's report concludes the unit was operating without proper procedures."
Shell's Big Oil Squeeze (4 May 2017): By Chris Hughes - Royal Dutch Shell Plc is defying skeptics and showing that it can afford its dividend. Investors just need to believe it hasn't made too many compromises to do so. The Anglo-Dutch oil giant generated $9.5 billion of operating cash flow in the first quarter, ample to fund $4.3 billion of investment, $2.7 billion of cash dividend payments and an $850 million interest bill. It even managed to cut debt without the benefit of big asset sales.
UK oil lobby warns May post-Brexit tariffs could double trade costs (3 May 2017): LONDON (Reuters) -- The cost of Britain's oil and gas trade with the rest of the world could nearly double if the country fails to agree new tariffs when it leaves the European Union, the country's oil lobby group has warned Prime Minister Theresa May.
MARKET WATCH: NYMEX crude oil for June drops below $48/bbl (3 May 2017): By Paula Dittrick - OGJ Upstream Technology Editor - US light, sweet crude oil futures for June fell more than $1 to settle under $48/bbl May 2 on the New York market while Brent crude oil prices in London fell more than a $1 to settle below $51/bbl. Brent briefly dipped to $50/bbl during electronic trading overnight, which Commerzbank analysts called “its lowest level since the end of March.”
Gulf refiners expanding capacity (2 May 2017): LeAnne Graves - Gulf refiners are expanding their capacity at home and in international markets such as China and India, racing to meet the shortfall in products expected by 2021.
BP Triples Q1 Profit, Latest Oil Major To Beat Estimates (2 May 2017): By Tsvetana Paraskova - In another sign that oil majors are recovering with the help of higher oil prices this year, BP (NYSE:BP) reported on Tuesday a first-quarter underlying replacement cost profit – its definition of net income – of US$1.51 billion, nearly triple the US$532-million profit for the first quarter last year and beating the consensus estimates of US$1.26 billion.
OPEC may need to extend production cuts to end of next year (1 May 2017): By ANTHONY DIPAOLA - DUBAI (Bloomberg) -- OPEC is certain to extend cuts in oil output when its ministers meet later in May and will need to keep limiting production until as late as the end of 2018, a veteran market analyst said.
SNC-Lavalin awarded services contract for Saudi Aramco gas plant (1 May 2017): ABU DHABI, UAE -- SNC-Lavalin announced it was awarded a contract by Saudi Aramco for engineering and project management services for the Berri Increment Program. New facilities are proposed at Saudi Aramco’s existing plants at Abu Ali and Khursaniyah to process a potential increased output of Arabian Light crude from the Berri Field on the east coast of Saudi Arabia.