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High Oil Prices Are No Defense Against Risk Of Stranded Assets

Posted on 23 September 2014 by VRS  |  Email |Print

There has been much concern in the financial community recently about the risk of “stranded assets” in the oil industry, particularly if governments introduce strict carbon regulations to fight climate change and therefore reduce demand for oil, which would reduce the price.
At the same time, developing new oil wells is becoming more and more expensive. Most of the easy oil has already been discovered and much of it is under the control of national oil companies in countries ranging from Russia to Iran to Venezuela………………………………………..Full Article: Source

Why Oil Prices Are Dropping Despite Mideast Unrest

Posted on 23 September 2014 by VRS  |  Email |Print

Canada’s oilpatch is basking in an extended sweet spot of sorts. Commodity prices aren’t spiking in a way that’s sure to sink the global economy, nor are they plumbing depths that would force small producers out of business and big players to start tightening their belts and cutting jobs.
The global oil market, however, is changing and nowhere are the signs more evident than the reaction to what’s happening in the Middle East. In the past, military conflicts in the Middle East and the attendant threat of supply disruptions would send oil prices soaring. Today, oil prices are falling even as the region is seemingly unraveling………………………………………..Full Article: Source

Moody’s cuts price assumptions for natural gas, oil through 2015

Posted on 23 September 2014 by VRS  |  Email |Print

Moody’s Investors Service last week reduced its assumptions for average spot prices for North American natural gas after a mild summer cut demand for gas-powered electricity. Moody’s also cut its assumption for the spot prices for the two benchmark barrels of crude, European Brent and West Texas Intermediate (WTI). Oil prices dropped this past summer due in part to slower economic growth in some of the world’s major economies, a strengthened U.S. dollar, and growing non-OPEC supply, Moody’s said.
The rating agency lowered its price assumption for North American benchmark Henry Hub natural gas to $3.75 per million British thermal units (MMBtu) through 2015, a 50-cent decrease from its earlier assumption of $4.25/MMBtu set in June. However, its assumptions for 2016 and beyond are unchanged at $4/MMBtu………………………………………..Full Article: Source

Russia and OPEC look like they are in a slump, but it is only a phase

Posted on 23 September 2014 by VRS  |  Email |Print

Russia and OPEC are under challenge from Western-led sanctions and the surge of US oil production, but it’s only a pause: both will be back stronger, according to a new report.
Since 2006, Russia has roared back from a post-Soviet plunge in oil production, producing a steady 10 million barrels a day, which in turn supports more than 40% of the state budget. A halt to drilling in the Russian Arctic announced Sept. 19 by ExxonMobil shows how Western sanctions could hurt Moscow’s ambitions to maintain at least that level of production for decades to come………………………………………..Full Article: Source

Oil prices fall on sluggish demand, ample supply

Posted on 23 September 2014 by VRS  |  Email |Print

Crude oil futures fell on Monday as ample supply and slowing economic growth in Europe and China outweighed expectations of a cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC).
Concerns over extended stagnation in Europe, which could pull down other economies, were highlighted at the G20 meeting in Australia on Sunday. China will not dramatically alter its economic policy because of any one economic indicator, Finance Minister Lou Jiwei said on Sunday………………………………………..Full Article: Source

Why Cheaper Oil Is Not A Big Threat For Gulf Economies

Posted on 22 September 2014 by VRS  |  Email |Print

The price of Brent crude has sunk by nearly $20 from its June peak to as low as $96 a barrel in recent weeks, its lowest level since mid-2012. Falling oil prices may prove the best medicine for economies in the Arab world, rebalancing growth towards countries struggling to recover from the Arab Spring uprisings without doing major damage to the oil exporters of the Gulf.
The price of Brent crude has sunk by nearly $20 from its June peak to as low as $96 a barrel in recent weeks, its lowest level since mid-2012. Behind the drop is soft economic data from top consumers such as China; a plentiful supply outlook points to further price declines in the next two years………………………………………..Full Article: Source

With LNG Export Battle Won, Are Oil Exports Next?

Posted on 22 September 2014 by VRS  |  Email |Print

Building on its success in getting the U.S. government to approve exports of natural gas, the oil and gas industry has moved on to the export of crude oil. To be sure, the campaign has been underway for quite a while. The four-decade old ban has been under attack over the past year because of the glut of oil that has come onto the market.
Increased supplies in places like North Dakota and Texas have led to a significant price discount between the Brent benchmark, which largely reflects international prices, and the West Texas Intermediate (WTI) benchmark based in Cushing, Oklahoma………………………………………..Full Article: Source

Rather than boon for Japan, U.S. shale oil is still rip-off

Posted on 22 September 2014 by VRS  |  Email |Print

The oil industry in the United States is booming with the shale gas revolution — a major technical breakthrough for extracting oil and gas trapped within shale formations. This led President Barack Obama on June 24 to lift the 39-year-old ban on petroleum exports.
In August, Cosmo Oil Co. of Japan started shipping shale oil to Japan from the U.S. Gulf of Mexico coastal area. Volume is expected to reach 300,000 barrels in October. Thereafter, Japanese trading firms will fall in line, boosting the volume to half a million barrels per month………………………………………..Full Article: Source

Saudi Arabia plays a complicated game with oil prices

Posted on 22 September 2014 by VRS  |  Email |Print

The recent sharp fall in oil prices shows a game within a game. Brent crude has lost nearly US$20 since June to fall below $100 a barrel, its lowest level for two years, even as Saudi Arabia cut 400,000 barrels per day from its production. The Saudis compete against non-Opec producers, while playing both with and against their Opec peers.
Saudi Arabia has a particularly complicated task at the moment. It firstly has to take the lead in deciding on a reasonable overall Opec production level. This never-ending question is one in which it is well versed in answering………………………………………..Full Article: Source

OPEC Supply Risks Mount as Biggest Libyan Field Is Halted

Posted on 19 September 2014 by VRS  |  Email |Print

A reduction in OPEC crude output deepened as Libya’s biggest producing oilfield stopped pumping amid supply cuts from Saudi Arabia and potential disruptions to Nigerian exports. Libya halted the Sharara oilfield as a precaution after a rocket attack on the connected Zawiya refinery three days ago, closing down about 30 percent of national output.
In Africa’s largest oil producer, state-owned Nigerian National Petroleum Corp. was in talks yesterday to prevent a strike that threatened to disrupt exports. Saudi Arabia told the Organization of Petroleum Exporting Countries that in August it made the deepest production cut in 18 months……………………………………..Full Article: Source

Oil-Price Quirk Sends Crude Out to Sea

Posted on 19 September 2014 by VRS  |  Email |Print

Big oil companies and traders are stashing millions of barrels of crude on massive tankers bobbing in the ocean, in a bid to profit from a quirk in oil markets. Instead of moving crude from one port to another, a growing number of tankers are serving as floating warehouses for companies including Sinopec Ltd. and Vitol Group, according to people with knowledge of their operations.
Other companies such as Mercuria Energy Group are using the tankers to haul crude to on-shore storage facilities, these people said. In a rare split, crude is cheaper in the spot market than in the futures market, where bets are made on where prices will be in the months ahead. By buying physical stocks of oil and immediately selling futures, traders can lock in a profit……………………………………..Full Article: Source

Falling oil prices no big threat to Gulf economies

Posted on 19 September 2014 by VRS  |  Email |Print

Falling oil prices may prove the best medicine for economies in the Arab world, rebalancing growth toward countries struggling to recover from the Arab Spring uprisings without doing major damage to the oil exporters of the Gulf.
The price of Brent crude has sunk by nearly $20 from its June peak to as low as $96 a barrel in recent weeks, its lowest level since mid-2012. Behind the drop is soft economic data from top consumers such as China; a plentiful supply outlook points to further price declines in the next two years. It is potentially the biggest shift for the Gulf Arab economies since the global financial crisis five years ago. But the huge financial reserves that they have built since then mean they are likely to cope fairly comfortably with cheaper oil……………………………………..Full Article: Source

OPEC Members See Cut in Output Ceiling as Unlikely

Posted on 18 September 2014 by VRS  |  Email |Print

OPEC members other than Saudi Arabia are unlikely to cut production or agree to a collective cut to the cartel’s output ceiling when it meets in November, several of the group’s delegates said Wednesday. They were speaking after Abdalla Salem el-Badri, the secretary-general of the Organization of the Petroleum Exporting Countries, said Tuesday that the group may lower its production by 500,000 barrels a day to adjust to lower demand for its crude oil next year, according to press reports.
His remarks were widely interpreted as a signal OPEC will cut its output ceiling of 30 million barrels a day, which has been in place since late 2011, when it meets in November…………………………………….Full Article: Source

Oil slips on scepticism over Opec cuts

Posted on 18 September 2014 by VRS  |  Email |Print

Oil prices eased as traders paused to consider recent news from Opec and Libya as well as official data that showed a larger than expected increase in US stocks.
Brent, the international crude marker, rose sharply on Tuesday after Abdalla El-Badri, the secretary-general of Opec, said the cartel could trim production by 500,000 barrels a day next year, and fighting between militia groups also hit output at a key field in Libya…………………………………….Full Article: Source

OPEC’s Badri expects OPEC to lower output target

Posted on 18 September 2014 by VRS  |  Email |Print

OPEC’s secretary general said he expected the group to lower its oil output target when it meets in late November, which would be its first formal output cut since the 2008 financial crisis.
Abdullah al-Badri was speaking after meeting Russian Energy Minister Alexander Novak on Tuesday. Oil dropped below OPEC’s preferred level of $100 a barrel last week, which also marks the pain threshold for top world oil producer Russia’s faltering economy…………………………………….Full Article: Source

The U.S. Oil And Gas Industry By The Numbers

Posted on 18 September 2014 by VRS  |  Email |Print

Have you ever wondered about the impressive numbers behind the U.S. oil and gas industry? The following infographic has all the answers. Even though oil production reached nearly 9,000,000 barrels per day in 2012, most people in the US are talking about “fracking”, slang for hydraulic fracturing, the controversial method for extracting shale gas.
There were about 45,000 fracking wells in the US in 2012 and the production of shale gas is skyrocketing as a result. Back in 2004, US shale gas production amounted to 0.6 trillion cubic feet and nearly 10 years on, that number has soared to 8.6 trillion…………………………………….Full Article: Source

Free Market Oil Price Decreases as US Oil Inventories Grow

Posted on 18 September 2014 by VRS  |  Email |Print

The free market oil price is declining as US commercial crude oil inventories grow, trading information revealed Wednesday. As of 6:51 p.m. Moscow time (14:51 GMT) the price of November futures on Brent Crude Oil decreased by 0.39 percent to $98.67 per barrel. The October futures price on WTI crude oil went down by 0.83 percent to $94.1 per barrel.
Earlier on Wednesday, the US Energy Information Administration reported that the volume of US commercial crude oil inventories increased over the week ending September 12 by 3.7 million barrels and stood at 362.3 million barrels…………………………………….Full Article: Source

OPEC’s Badri sees oil prices rising again by year-end

Posted on 17 September 2014 by VRS  |  Email |Print

OPEC secretary general Abdalla el-Badri said Tuesday he expected world oil prices to stage a recovery from two-year lows by the end of this year. The oil producer group’s crude basket, which dipped below the $100/barrel level in mid-August and has been falling since, stood at $94.68/b on Monday.
“The oil price has been falling over the past two months but we believe that the price will grow again by the end of the year,” Russian news agency Prime quoted Badri as saying after talks with Russian energy minister Alexander Novak in Vienna. A joint statement said the talks had reached “a general consensus that the market is well-supplied with healthy stock levels and adequate spare capacity.”……………………………………..Full Article: Source

OPEC Secretary-General Says Group May Pump Less Oil in 2015

Posted on 17 September 2014 by VRS  |  Email |Print

OPEC, the group supplying about 40 percent of the world’s oil, may cut production next year, its Secretary-General Abdalla El-Badri said.
The Organization of Petroleum Exporting Countries’ daily output target could fall by 500,000 barrels to 29.5 million barrels in 2015, El-Badri said at OPEC’s secretariat in Vienna after talks with Russian Energy Minister Alexander Novak today. The group’s monthly report on Sept. 10 showed demand for its oil will drop to 29.2 million barrels a day in 2015 from 29.5 million this year………………………………………Full Article: Source

OPEC May Lower Oil Production to 29.5Mln Barrels Per Day in 2015

Posted on 17 September 2014 by VRS  |  Email |Print

The Organization of the Petroleum Exporting Countries (OPEC) may decide to lower its oil output from 30 million barrels per day to 29.5 million, OPEC Secretary General Abdalla El-Badri, said on Tuesday. “I think our target next year will be lower, may be by 500,000 barrels,” El-Badri told reporters at the group’s headquarters in Vienna.
“This is an outlook, this is not a decision,” he said, adding that the decision could be made at the next regular OPEC ministerial meeting scheduled for November 27. El-Badri reiterated he was not overly concerned about the current drop in oil prices and said he expected them to rebound by the end of this year………………………………………Full Article: Source

Russian Central Bank Fears Weak Oil Price Could Threaten Economy

Posted on 17 September 2014 by VRS  |  Email |Print

The Bank of Russia said that the ruble and the Russian economy could be hit by sliding prices for commodities—the country’s key exports—if oil prices fail to recover in the midterm.
The ruble hit fresh all-time lows on Tuesday, weakening to 38.93 against the dollar, as banks and companies bought foreign currencies and external markets remained largely closed to Russian borrowers. A drop in the price of Brent crude to $98 per barrel from above $115 three months ago has added to downward pressure on the ruble………………………………………Full Article: Source

Global oil demand sinks but lower Australian dollar pushing up the price of fuel

Posted on 17 September 2014 by VRS  |  Email |Print

The falling Australian dollar may be good news for exporters, but it will drive up the price of fuel. After hitting a 15-month low earlier in September, petrol and diesel prices are expected to head upwards, despite a much lower oil price on the back of rapidly dropping demand.
The International Energy Agency has described the sudden drop in global demand as nothing short of remarkable. Forecaster OPEC has recently cut its forecast and says output will exceed demand by more than one million barrels a day by 2015………………………………………Full Article: Source

Russia’s energy minister to meet OPEC as oil price falls more

Posted on 16 September 2014 by VRS  |  Email |Print

Russian Energy Minister Alexander Novak will meet OPEC officials on Tuesday in Vienna, his spokeswoman said, as oil’s price fall piled pressure on Moscow’s budget. The annual meeting had been planned long before oil fell below the $100 per barrel level critical for Russia’s oil sales which account for 40 percent of state budget revenues.
Russia suffered from a decline of oil production and prices this year and has cut its outlook for oil output as core Western Siberian fields become more depleted………………………………………..Full Article: Source

Oil Prices Fall as China Data Fuel Demand Concerns

Posted on 16 September 2014 by VRS  |  Email |Print

Global oil prices deepened their slide Monday after weak industrial and retail data from China raised concerns about demand for crude. The global Brent crude contract on the ICE Futures Europe exchange fell 46 cents, or 0.5%, to $96.65 a barrel, the lowest settlement since June 28, 2012. Brent is down 17% from the 2014 high reached in mid-June. The October Brent contract expired with the close of trading Monday.
Analysts cited disappointing data from China in oil’s selloff on Monday, with industrial production in the world’s second-largest oil consumer slowing to the lowest rate since 2008 and new-car sales also decelerating………………………………………..Full Article: Source

Libya, Iraq Insecurity May Hit Future OPEC Supply Prospects

Posted on 16 September 2014 by VRS  |  Email |Print

Amid a continuing slide in global oil prices, the head of OPEC has said political insecurity in Iraq and Libya could affect the oil-producing cartel’s future output prospects.
In an interview at the Organization of the Petroleum Exporting Countries’ headquarters, Secretary-General Abdalla Salem el-Badri said that while Iraq has great potential to grow oil production, it needs to solve its security problems. “If there is no security, there will be no investment,” he said. “If there is no investment, there will be no additional supply.”……………………………………….Full Article: Source

Russia’s challenge to an oil-hungry world

Posted on 16 September 2014 by VRS  |  Email |Print

The oil price may be falling and global demand is “remarkably” subdued, according to a report last week from the International Energy Agency. But this has not stopped the former chief executive of BP, Tony Hayward, from issuing an uncomfortable warning.
In an interview with the FT, Mr Hayward, who these days runs an oil company in Iraqi Kurdistan, worries that international sanctions against Russia’s oil sector are storing up trouble for the west. They risk cutting investment and damaging supplies from the world’s third-largest producer. The threat may have been masked by increases in American liquid petroleum production, which has surged above its 1970 zenith………………………………………..Full Article: Source

Oil price slide sets the stage for M&As

Posted on 15 September 2014 by VRS  |  Email |Print

As the oil price slides, nervous oil executives are wondering how low it can go. Brent crude hit its lowest level in two years last week, raising questions about how the industry – and the large international oil groups in particular – would cope with a sustained period of weakness.
Nick Butler of King’s College London, a former strategist for BP, noted in the Financial Times last week that he knew of at least three major oil and gas companies that had ordered “full scale strategic reviews.”……………………………………….Full Article: Source

OPEC Chief Sees Oil Price Rebounding by Year End

Posted on 15 September 2014 by VRS  |  Email |Print

OPEC’s chief said on Friday that no emergency meeting is being considered as he expects oil prices to rebound by the end of the year. The Brent oil price—the most widely used international benchmark—fell below $100 a barrel this week and remained around $98 a barrel on Friday.
But in an interview with The Wall Street Journal at the group’s headquarters in Vienna, OPEC secretary-general Abdalla Salem el-Badri said that “the price will come back.” An emergency meeting of the Organization of the Petroleum Exporting Countries “isn’t on our radar,” Mr. el-Badri said………………………………………..Full Article: Source

Current oil price level satisfies OPEC

Posted on 15 September 2014 by VRS  |  Email |Print

The current level of oil price is satisfying to the Organization of Petroleum Exporting Countries (OPEC), Parviz Mina, the international petroleum consultant says. The price of $95 to $100 per barrel satisfies the OPEC producers as well as the main crude oil buyers, Mina, who served as a member of OPEC Long-Term Strategy Committee, told Trend Sept. 12.
He went on to add that the both sides consider the current crude price as suitable and the parties do not want to make change on it. So, the OPEC countries have not decided yet to lower their export level to increase the price, he said………………………………………..Full Article: Source

Brent Crude Oil may fall to $96.75, 95 levels: Barclays|

Posted on 15 September 2014 by VRS  |  Email |Print

Brent crude oil prices fell below $100 per barrel last week and there is a likelihood of prices faling to $96.75 and $95 per barrel, Barclays Research said. The market is adjusting to a situation when there is ample light sweet oil supplies amidst a relatively softer global oil demand growth, Barclays added.
As the OPEC basket price touches $96/bbl (levels last seen in June 2012), the clarion call for balancing the market from the supply side is growing louder. The resolve from individual OPEC members, and the pace of their reaction, looks set to be tested over the coming months as they choose to collectively defend $100/bbl or individually maintain market share………………………………………..Full Article: Source

IEA Cuts 2015 Oil Demand Forecasts

Posted on 12 September 2014 by VRS  |  Email |Print

The International Energy Agency Thursday trimmed its forecast for the rise in oil demand this year for the third month in a row, calling the recent slowdown in demand “nothing short of remarkable.” In its closely watched monthly oil market report, the Paris-based energy watchdog said it expects global oil demand to grow by 0.9 million barrels a day in 2014, a decrease of 65,000 barrels a day compared with last month’s forecast and down by 300,000 barrels a day since July.
According to the IEA, oil demand growth in the second quarter was at its lowest in 2½ years, dented by economic weakness in Europe and China, a trend the agency expects will continue to weigh on demand………………………………………..Full Article: Source

IEA Cuts Demand Estimate as Saudi Exports Drop to 2011 Low

Posted on 12 September 2014 by VRS  |  Email |Print

The International Energy Agency cut its global oil demand forecasts for 2015 and said Saudi Arabia exported the least in almost three years as purchases slowed from China and Europe.
Global demand will increase by 1.2 million barrels a day, or 1.3 percent, to 93.8 million barrels a day next year, the Paris-based adviser to 29 nations said in a report today. The expansion is 165,000 barrels a day less than it predicted a month ago. Second-quarter growth in consumption slid to a 2 1/2-year low, spurring Saudi Arabia’s shipments to the lowest since September 2011………………………………………..Full Article: Source

Oil slumps to two-year low on IEA demand downgrade

Posted on 12 September 2014 by VRS  |  Email |Print

Global oil prices hit a two-year low today after the International Energy Agency cut its forecasts for world demand, with the market also weighed down by plentiful supplies, analysts said.
In earlier London trade, Brent North Sea crude for October sank to USD 96.72 per barrel — the lowest point since July 2, 2012. And US benchmark West Texas Intermediate (WTI) for October delivery slid to USD 90.43 — a level last seen on May 1, 2013………………………………………..Full Article: Source

No need for urgent OPEC meet on lower oil price: Kuwait

Posted on 12 September 2014 by VRS  |  Email |Print

OPEC member Kuwait said on Thursday there was no need to call an emergency meeting for the producers` cartel to discuss sliding oil prices after crude hit a 17-month low. “We do not believe there is a need to call an emergency OPEC meeting” to discuss the drop in prices, Oil Minister Ali al-Omair told reporters at the end of a regular meeting of the oil ministers of the Gulf Cooperation Council (GCC).
“So far, we are confident that prices have not dropped to the extent that makes us call for an emergency meeting,” Omair said. Oil prices fell in Asia Thursday after coming under pressure due to weak global demand and a supply glut, even as US President Barack Obama vowed to destroy jihadist militants in Syria and oil-rich Iraq………………………………………..Full Article: Source

Saudi oil minister plays down drop in oil price

Posted on 12 September 2014 by VRS  |  Email |Print

Saudi Oil Minister Ali Al Naimi on Thursday played down the drop in oil prices saying this is not the first time crude prices slumped. “Prices of oil always go up and down so I really don’t know why the big fuss about it this time,” Al Naimi told reporters ahead of a regular meeting for oil ministers of the Gulf Cooperation Council (GCC) states in Kuwait City.
The Saudi minister, whose country pumps over 9.5 million barrels per day, said any measures the Organisation of Petroleum Exporting Countries (Opec) needs to take regarding the price slump “should be discussed when Opec meets” in November………………………………………..Full Article: Source

Saudi Arabia can cope with $85 Oil and create global demand

Posted on 12 September 2014 by VRS  |  Email |Print

Traditionally, lowering prices of Crude oil lead to a supply response from major OPEC producer, Saudi Arabia. However, this time around, it hasn’t done so but raised production since June.
With an annual budget of $230 bn and a running surplus of $ 40 bn, Saudi Arabia can easily cope with $85 bn Crude Oil for years, according to an assessment by Bank of America-Merrill Lynch (BofAML). However, the strategy carries risks including a ramp up in global demand and further turmoil in oil producing countries as prices decline………………………………………..Full Article: Source

Sub-$100 Oil Is Just A Price, Not A Signpost

Posted on 12 September 2014 by VRS  |  Email |Print

The fall in Brent prices below $100 for the first time in months is, to some, a startling development, especially given the insistence in some quarters that $150 is the next ‘target’ as economic recovery increases demand and shale oil production shows signs of weakness.
Needless to say, predicting short-term oil prices will make you very humble (well, at least a little humble) and given the fluctuations from $10 to $137 in the past decade and a half, it is hard to argue that there is a price level that is not possible to reach. However, $150 seems close to impossible without another major supply disruption. As Damon Runyon said, “…but not the way to bet.”……………………………………….Full Article: Source

Increase in Iran oil storage to increase export flexibility

Posted on 12 September 2014 by VRS  |  Email |Print

A substantial increase in Iranian oil storage capacity will give the sanctions-hit country more flexibility to export crude, the International Energy Agency (IEA) said on Thursday.
The United States and the European Union have imposed sanctions on the Islamic Republic over its nuclear programme, preventing it from reaching production capacity. Limited storage capacity has forced it to keep crude on National Iranian Tanker Co (NITC)-controlled tankers at sea………………………………………..Full Article: Source

Saudi Arabia slashes oil output to defend $100 price

Posted on 11 September 2014 by VRS  |  Email |Print

World’s biggest exporter of oil reacts to slide in prices by trimming 400,000 barrels per day of output in August. Saudi Arabia, the world’s biggest oil exporter, has slashed its production of crude in an apparent attempt to prevent the price falling further below $100 per barrel.
The kingdom, which has the capacity to pump 12.5m barrels per day (bpd) of crude at full choke, trimmed 400,000 bpd from its output last month as prices began to weaken, according to a monthly market report issued by the Organisation of Petroleum Exporting Countries (Opec). That is equal to about half the UK’s total oil output at present levels………………………………………..Full Article: Source

OPEC Splits on Response to Falling Oil Prices

Posted on 11 September 2014 by VRS  |  Email |Print

A split in response to falling oil prices emerged among members of the Organization of the Petroleum Exporting Countries after Saudi Arabia cut its oil production sharply last month while other leading members raised their output.
Saudi Arabia, the cartel’s kingpin, said Wednesday it had cut its crude production by about 400,000 barrels a day in August. An industry official said the drop was tied to lower exports to the kingdom’s core Asian markets. But Iran and Nigeria have told OPEC they increased their crude output by 10,000 barrels a day and 152,000 barrels a day last month, respectively………………………………………..Full Article: Source

OPEC says world will need less of its oil next year

Posted on 11 September 2014 by VRS  |  Email |Print

OPEC said demand for its crude oil will be lower than expected next year, with a surge in US output potentially bringing its production to levels not seen since the past decade.
In its monthly oil-market report, the Organization of the Petroleum Exporting Countries said it had lowered the estimate of demand for its crude by 200,000 barrels a day for 2015 and by the same amount for this year. As a result, markets will need 300,000 barrels a day less of OPEC crude next year, it said………………………………………..Full Article: Source

US EIA: Trims 2014 Oil Demand Outlook, Upgrades Non-OPEC

Posted on 10 September 2014 by VRS  |  Email |Print

The U.S. Energy Information Administration Tuesday lowered its forecast for how much it sees world oil demand growing in 2014, while upgrading its expectation regarding the amount of supply that will come from non-OPEC producers this year. The agency reported in its September Short Term Energy Outlook that U.S. oil output in 2015 will likely average its highest level in 44 years, but cut it’s projection for U.S. gasoline prices and international oil prices.
“The recent inventory builds are somewhat atypical for this time of year and signal a relatively loose global crude oil market compared with conditions over the past three years,” the EIA said, adding that, “Weaker oil demand and lower refinery runs in European and Asian countries within the Organization for Economic Cooperation and Development (OECD) this year have reduced market tightness.”……………………………………….Full Article: Source

Platts Survey: OPEC Pumped 30.2 Million Barrels of Crude Oil Per Day in August

Posted on 10 September 2014 by VRS  |  Email |Print

Oil production from the Organization of the Petroleum Exporting Countries (OPEC) climbed 70,000 barrels per day (b/d) to 30.2 million b/d in August from 30.13 million b/d in July as Libyan output surged despite the downward spiral of political chaos in the country, a Platts survey of OPEC and oil industry officials and analysts showed Tuesday.
The OPEC total in August represents the highest volume from the oil producer group since August 2013, when output averaged 30.28 million b/d. The increase from Libya, supplemented by a 50,000 b/d rise in Angolan output and smaller 20,000 b/d boosts from the United Arab Emirates (UAE) and Venezuela, more than offset decreases of 80,000 b/d and 50,000 b/d from Iraq and Saudi Arabia, respectively. Iranian output remained steady at 2.85 million b/d………………………………………..Full Article: Source

Oil market pricing escapes linkage to financial benchmark regulations

Posted on 10 September 2014 by VRS  |  Email |Print

The oil market’s price setting agencies have avoided being linked to the kind of regulation trained on financial benchmarks, in a report by international regulators.
The decision by the International Organization of Securities Commissions (IOSCO) comes as the European Union is investigating allegations of oil price manipulation, which has involved searching the offices of major oil companies and pricing agencies………………………………………..Full Article: Source

If oil prices stay low for long, Putin and OPEC are headed for trouble

Posted on 10 September 2014 by VRS  |  Email |Print

Oil plunged today below $100 a barrel, a psychological threshold that, if it holds, threatens the rulers of Russia and numerous OPEC states that rely on higher prices to mollify their populations. A critical question, then, is whether we are looking at a sustained period of lower prices or a blip before a swing back up.
The price of Brent crude—the type that dominates international trade—fell as low as $99.36 today, its lowest price in 14 months. (West Texas Intermediate, the oil produced in the United States, plummeted to $91.70 a barrel, frighteningly close to its own $90 threshold.)……………………………………….Full Article: Source

Brent oil falls below $100 to 17-month low as supply weighs

Posted on 10 September 2014 by VRS  |  Email |Print

Brent crude oil prices fell to a 17-month low below $100 per barrel in volatile trade on Tuesday, a fourth straight daily decline as ample supplies weighed, while U.S. crude rose on the expectation of dwindling fuel stockpiles.
Brent crude fell as feared cuts to supply due to violence in the Middle East have failed to materialize, and production resumed at Britain’s North Sea Buzzard oilfield after a series of shutdowns and failed restarts………………………………………..Full Article: Source

Oil prices below most OPEC producers’ budget needs

Posted on 09 September 2014 by VRS  |  Email |Print

Oil prices are now too low for most OPEC countries to cover their spending needs, a Reuters survey shows. Although the cost of getting oil out of the ground is low in most countries in the cartel, growing social spending and ambitious infrastructure plans mean many oil producers now earn less from their oil sales than they need to fund their budgets.
The weighted average of oil prices collected by members of the Organization of the Petroleum Exporting Countries was $106 a barrel last year - just enough to cover the average budget requirements of the group, according to figures compiled by one team of analysts, who declined to be identified. But oil prices are falling, and the OPEC crude oil basket price was just $98.36 a barrel on Friday, the OPEC Secretariat calculates………………………………………..Full Article: Source

Oil below $100 tightens OPEC budgets, prompts signs of concern

Posted on 09 September 2014 by VRS  |  Email |Print

Oil’s slide below $100 a barrel on Monday adds to financial worries for OPEC members, prompting some in the producer group to voice concern about too much oil in the market even if they see the current fall as short lived.
Brent crude fell below $100 a barrel for the first time in 14 months, hit by concerns about slower economic growth and ample supply. Top OPEC exporter Saudi Arabia favors oil at $100, which many others in the 12-member group also support………………………………………..Full Article: Source

Crude Prices Close at Lowest Level in More Than a Year

Posted on 09 September 2014 by VRS  |  Email |Print

Global oil prices ended Monday at the lowest level in more than a year as Chinese and U.S. data spurred investors to bet demand wouldn’t rise fast enough to absorb new supply. Oil markets have been in decline since mid-June, with booming production, primarily in the U.S., outweighing worries that crises in the Middle East and Eastern Europe could disrupt supply distribution.
Now traders are concerned demand won’t keep up. Data from the world’s top oil consumers—the U.S. and China—suggest their economies aren’t growing as quickly as some had hoped………………………………………..Full Article: Source

Oil price drops below $100 a barrel as GCC producers are close to curbing supply

Posted on 09 September 2014 by VRS  |  Email |Print

Oil prices on Monday dipped below the US$100-a-barrel mark, threatening to pinch oil-dependent states’ budgets and getting closer to the level where Arabian Gulf swing producers feel pressured to curb supply. The European benchmark Brent fell below the psychological barrier for the first time in 14 months.
Already last Friday, the Opec crude oil basket price was at US$98.36 a barrel. While prices are still comfortably above the break-even point for the budgets of most Gulf countries, the majority of Opec’s 12 members require higher oil prices to meet their budget obligations. That includes countries that have the additional strain of internal conflict or external pressures, such as Iraq, Nigeria and Iran………………………………………..Full Article: Source

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