Oil rises 1% on settlement amid fears of supply shortages

[yota691]

Iran: Iraq increases production of oil despite OPEC agreement

 

energy Economy News Baghdad: "Iraq is constantly increasing its oil production, regardless of its commitment to OPEC's decision to cut production," said OPEC's representative to the country, Hossein Kazempour. According to Kazempour, Iraq's crude oil production in August amounted to 4.649 million barrels per day, an increase of 88 thousand barrels per day from October. "Iraq's oil production continues to grow thanks to the presence of international and US energy companies in the country. The latest report by Wood Mackenzie (Energy Research and Consulting) indicates that oil production in the country will stabilize at 4.48 million bpd in 2019," he said. But with regard to OPEC's deal with Iraq, he said, "OPEC is also an organization whose decision-making mechanism depends on the political will of the country Member States and there is no punitive mechanisms for members." Views 637   Date Added 17/09/2018

[Pitcher]

While energy outlook improves for Iraq, vulnerabilities remain

Country faces potential risk of double challenges at home and in wider region

Smoke rises over Basra in southern Iraq.

Protesters in a hot, dry summer have burnt down government buildings and the Iranian consulate, while gas flares continue to symbolise the waste of abundant natural resources. As Iraq’s oil industry is on the up, the politics of this pivotal country are shifting again.

Iraq is a key petroleum player. Along with Saudi Arabia, Kuwait and the UAE, it is one of the four Opec countries able to increase production significantly to make up for losses from Venezuela’s ongoing economic collapse and sanctions on Iran. As well as bringing its spare capacity back into play, it also has ongoing development work which could see it top 5 million barrels per day of capacity by the end of this year.

Figures analysed by Iraq Oil Report showed a sharp rise in production, from 4.7 million bpd in July, to 4.81 million bpd in August, almost half a million barrels per day above its original target under the Opec/non-Opec deal of December 2016.

The production gain could realise extra revenues of more than $1 billion per month, compared to the total budgeted oil revenues for this year of $65bn. Meanwhile, with Iraqi crude currently selling for around $73 per barrel, versus the budgeted $46, the country is enjoying another $3bn monthly windfall from higher prices.

Yet Iraq is doubly vulnerable: from political turmoil at home, and being sucked into conflicts in the region. The Basra protests flared up in July amid shortages of gas and electricity after Iran cut supplies. The city, once termed “The Venice of the East”, has been plagued by water rendered undrinkable, again partly due to upstream blockages amid drought in Iran.

Some 85 per cent of Iraq’s oil output, outside the Kurdish region, comes from the Basra governorate. But the city sees little of this money. Demonstrators have targeted oilfields, trying to shut down access points, and demanded jobs for locals, but the industry is not a large employer and most of the roles it does offer are for skilled technicians. Protection money, payments to tribal leaders for services like trucking, and the $1 per barrel “petrodollar” budget allocated to oil-producing provinces, fail to filter through to ordinary people.

The dynamic is somewhat reminiscent of Nigeria’s delta region, where decades of oil production have left little local benefit, and attracted the wrath of gangs of young men who regularly halt output. The terrain in southern Iraq is less favourable to sabotage, its oilfields are well defended, but pipelines and export terminals are vulnerable to attacks or blockades. A continuing swell of unrest would further complicate the difficult tasks of raising Iraq’s oil output, capturing wasted gas, boosting electricity output and building water treatment plants.

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Popular anger against Tehran and its aligned parties has surged, even as many Iraqis blame Iran for instigating the protests. But Basra’s crisis is the outcome of long dysfunction of both the government in Baghdad and the provincial authorities. Incumbent parties have all lost electoral support, but no movement has emerged with a coherent alternative programme.

Manoeuvrings to form that government have continued since May’s elections, with a shifting logjam of parties, members of which periodically jump ship. The demonstrations have helped sink the chances of incumbent prime minister Haider Al Abadi, who despite his victories over ISIL and over the autonomous Kurdish authorities, has failed to bring development or much-needed infrastructure to the south.

 

Moqtada Al Sadr, whose alliance won the most seats in the election, has repeatedly declared his desire for a technocratic, non-sectarian government. The next government will have more money to play with, and will try short-term handouts to assuage popular anger.

But the authorities will have to make difficult, inherently political decisions, such as the allocation of oil revenues between Basra or the areas laid waste by ISIL. And even if capable, non-corrupt technocrats are found, they will remain beholden to the parties that back them.

 

Broken window of a restaurant in Basra. Iraq has been hit by protests. AFP</p>

 

Iraq’s struggles at home leave it vulnerable to the region’s wider political conflicts. In particular, it is an arena where Iran can seek to strike back at the intensifying US sanctions. As well as buying growing quantities of Iranian gas, Iraq is a key market for Iran’s non-energy products. It offers one route for transferring sanctioned quantities of oil under a new label.

But Iraq is, as discussed, one of the vital states for keeping a lid on oil prices as Iran’s exports drop, in effective cooperation with the three other leading Opec members. Tehran faces a conundrum here: it could further destabilise Iraq to keep its oil off the market and try to blunt sanctions. Shutting down Basra’s oil exports would be far easier and more deniable than its vague threats of closing the Strait of Hormuz.

Yet undermining the government in Baghdad would attract further anger and loss of influence, close Tehran’s own escape hatch, and risk the resurgence of its enemy, ISIL. Iraq is unlucky to be caught between rival powers, but its politicians have to solve their own problems. That begins with pouring fresh water on the flames in Basra.

 

https://www.thenational.ae/business/energy/while-energy-outlook-improves-for-iraq-vulnerabilities-remain-1.770758

[Pitcher]

Iraq’s Oil Production Problem

 

Iraq’s oil production will only grow marginally over the next 10 years despite its potential capacity, which stands at as much as 7 million bpd, an analyst from IHS Markit has forecast.

According to Christopher Elsner, OPEC’s second-largest producer will only be able to boost production to 5 million bpd over the next decade, and by 2036 it would only grow to 6 million bpd, Arab News reports.

The reason for the country’s inability to boost production considerably is the political and economic situation. Iraq is currently dealing with protests in the south prompted by problems ranging from a lack of access to clean drinking water and electricity to high jobless rates.

But there are also industry-specific problems, according to Elsner, and most of them have to do with money. Noting that the estimated production numbers were “conservative”, Elsner explained, “There is a lot of investment in getting wells out of the ground. And there’s a lot of investment in exporting that oil. But the connections between the oil fields and the storage farms in the south and the export points have been what has really led to the bottlenecks in Iraq.”

Pipeline shortages and lack of electricity in some fields were also among the challenges that Iraq needs to overcome if it wants to boost its production more considerably and more quickly.

 

Related: The U.S. Calls On Russia To Cap Soaring Oil Prices

Iraq had oil reserves of 153 billion barrels as of last year, but earlier this year Oil Minister Jabar al-Luaibi said the actual reserves could be twice as large. If the higher estimate proves true, it would make Iraq the largest oil-rich country in the world, ahead of Venezuela, which claims its reserves are just above 300 billion barrels, and also ahead of Saudi Arabia, with 260.8 billion barrels.

Even so, developing these reserves will still require a lot of capital and infrastructure expansion that Iraq is currently finding difficult to find and build, respectively.

 

 

https://oilprice.com/Energy/Energy-General/Iraqs-Oil-Production-Problem.html

 

[Pitcher]

Iraq oil production to be ‘squeezed for next decade’

 

Updated 17 September 2018

The state-run company responsible for oil projects in mid-stream had “a spotty execution track record

LONDON: Growth in Iraqi oil production will be squeezed for the next decade despite the country being the second largest OPEC producer after Saudi Arabia and the fourth biggest in the world, according to a report by US consultancy IHS Markit.
The findings come after a week when the price of Brent crude reached $80 a barrel, with supply worries having been heightened by Hurricane Florence heading toward the US, threatening to derail US oil pipelines. Also looming large was the expected effect on supply by the reimposition of US sanctions on Iran.
IHS said that Iraq, which theoretically could produce about 7 million barrels per day (bpd), would only marginally boost output to 2028. The current 4.5 million bpd would only increase to 5 million bpd over the next decade, said IHS analyst Christopher Elsner in an interview with Arab News.
Elsner said that he may revise his forecast upward if conditions in the country improve, but on current thinking, even by 2036 Iraq’s production would only reach 6 million bpd, he said.
A former international energy infrastructure analyst at the US Department of Energy who has worked on Iraqi projects, Elsner commented: “Yes, our numbers are conservative against the official Iraqi data. There is a lot of investment in getting wells out of the ground. And there’s a lot of investment in exporting that oil. But the connections between the oil fields and the storage farms in the south and the export points have been what has really led to the bottlenecks in Iraq.
Other impediments were the absence of electricity to run some oil fields, as well as the lack of pipelines, pumping stations and storage space — all of which have constrained capacity.
“Coordinating the purchase of various components such that you can progress without delay … has been another major issue,” said Elsner.
The state-run company responsible for oil projects in mid-stream had “a spotty execution track record,” he added. There was legal uncertainty around contracts, security risks, and water and electricity services were unreliable.
The IHS report added that Iraq’s crude oil consumption is currently 0.7 million bpd, and this was expected to grow very slowly, to 0.8 million bpd by 2030. Iraq’s crude exports are the difference between production and consumption.
The oil-rich Basra province was rocked by renewed violence earlier this month as political protests regain momentum, threatening oil facilities. Thousands of Iraqis have been taking to the streets daily over the past week, torching government buildings and political party offices.
The demonstrations have added to oil supply concerns, although these turn principally around worries about the absence of Iranian crude later this year when US sanctions kick in. India and China have begun to reduce their purchases of Iranian oil while South Korea has already dropped imports to zero on the orders of the Trump administration, according to the Financial Times.

 

http://www.arabnews.com/node/1373171/business-economy

 

[Pitcher]

Why WTI Could Crash In The Coming Weeks

West Texas Intermediate could drop to US$65 a barrel later this year on the back of extra maintenance work at U.S. refineries, Tom Kloza from the Oil Price Information Service has warned. Speakingon CNBC, Kloza said this maintenance season was the last chance for many refineries to hop on the new bunker fuel train by boosting their capacity for low-sulfur diesel and fuel oil.

"The next six to seven weeks we're going to see demand for crude drop by about 1 to 1.5 million barrels a day. It's refinery maintenance season," Kloza said.

The new bunker fuel emission rules, effective from 2020, stipulate that only vessels using fuels with sulfur content of 0.5 percent or less will be allowed to roam the oceans. The change is part of the International Maritime Organization’s strategy to cut carbon emissions from maritime transport by half by 2050.

The change has been touted as beneficial for refiners that are equipped to produce low-sulfur fuel oil and diesel, as well as LNG producers. Yet the adjustment will take time, and during this time demand for crude will be lower. How serious the effect on WTI prices will be remains to be seen, however.

For starters, many of those following WTI must have already factored in maintenance season and winter as weakening demand press down on prices. True, Kloza’s comment that this maintenance season will have a more severe impact on prices makes sense, but this additional maintenance should not come as a surprise to market watchers: there has been a lot of coverage about the IMO fuel rules and there’s likely to be even more in the run-up to its entry into effect. Related: Diesel Demand Is Set To Soar

 

Another thing that could curb the downside effect on maintenance season is hurricane season: Florence has hit demand for oil products but, one analyst told Market Watch, “there will be demand destruction in the short term, but a surge in demand in a few weeks when [the region] starts to rebuild.” In other words, amid refinery season, rebuilding what Florence has damaged will apply counter pressure on prices, possibly curbing the decline.

Then there are the Iran sanctions, of course, the ace among bullish oil price factors that analysts and commentators have been waving in the market’s face since May. The United States is still trying to get its international allies to cut their imports of Iranian oil to zero even in the face of evidence that this will not be possible. The latest update in this respect suggests that there will be no waivers for countries that want to continue importing Iranian crude, even though earlier this year, senior Washington officials had said that waivers would be considered on a case-by-case basis.

So, in this context, the effect of additional refinery maintenance work on WTI prices could be limited, especially if the Iran-related signals from Washington continue in the same vein. Price trends have repeatedly demonstrated that benchmarks are equally strongly affected by fundamentals and geopolitical events that may or may not affect these fundamentals. As for Iran, there have been numerous assurances from OPEC and Russia that they will step up production to make up for lost Iranian crude. This should quell worry about supply, but it has not, so the upside potential for WTI remains as the U.S. benchmark tends to follow Brent, which will benefit from the sanctions even more: Kloza expects it at US$80 a barrel in the last quarter of the year.

 

https://oilprice.com/Energy/Oil-Prices/Why-WTI-Could-Crash-In-The-Coming-Weeks.html

[yota691]

Novak: The price of 70-80 dollars per barrel of oil and temporary sanctions

 

Arab and international Economy News _ Baghdad MOSCOW (Reuters) - Oil prices between $ 70 and $ 80 a barrel are only temporary and due to sanctions, Russian Energy Minister Alexander Novak said on Tuesday, adding that the long-term price would be around $ 50 a barrel. He said the $ 50-a-barrel forecast was based on estimates by analysts and oil companies. Novak said he expected Russian oil production to reach 553 million tonnes (11.105 million barrels per day) in 2018 and rise to 570 million tonnes in 2021. Views 7   Date Added 18/09/2018

[yota691]

OPEC oil prices rise and record above $ 76

 

Tuesday 18 September

 

 

Al-Sumerian News / Baghdad OPEC announced on Tuesday that the price of the OPEC basket daily recorded above $ 76 per barrel.  "The price of the OPEC basket of fourteen barrels of crude was $ 76.19 per barrel," the group said in a statement read by Alsumaria News.  "The price rose from the previous day of $ 76.05, according to the calculations of the OPEC secretariat," the agency said.  Composed Organization of Petroleum Exporting Countries basket (OPEC) reference of the following: desert mixture ( Algeria ), and Girassol (Angola), and Oriente (Ecuador), and Zafiro (Equatorial Guinea), and Raby Lite (Gabon), Iran Iran), Basra Lite ( Iraq ), Kuwait Express (Kuwait), S Sider ( Libya)), Bonnie Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Morgan (United Arab Emirates) and Miri (Venezuela).

[Pitcher]

Gazprom could be the new force in Syria when troops leave

"We will support oil and gas companies but we will also control their work." -- Russian President Vladimir Putin

 

In the corridors of power: Russian President Vladimir Putin with Gazprom Chief Executive Alexei Miller. File Photo courtesy of the Kremlin

Sept. 18 (UPI) -- The Iraq War saw the use of commercial military forces -- mercenaries -- to an extensive degree unprecedented in the modern era. One of the military contracting firms, Blackwater (now Academi), saw four of its security contractors charged with killing 31 people at a Baghdad roadside shooting in 2007 (sentences which were overturned last year). That same year, 2007, there was a similar shift in the nexus between business and security in Russia when Moscow's parliament voted to allow its energy giants Gazprom and Transneft to effectively create their own militaries, with weapons and technology supplied by the Kremlin. 106

 

In fact, Russia's energy firms have followed a trend first started by British oil and gas firms, many of which have hired security contractors for operations in unstable regions. The next logical step is to merge the two: newly armed energy firms become militarized resource companies, a wealthier and more resource-rich counterpart to private military companies such as Blackwater. With a well-armed corporate militia, Gazprom and others can aggressively protect assets at home and abroad, and may soon play a major role in Russia's energy plans for Syria. 89

Before the civil war, Syria produced over 400,000 barrels of oil per day. But by 2013 the number had dropped to 58,000. And so by January 2018, Syria's beleaguered President Bashar al-Assad had signed an agreement with Russian President Vladimir Putin, Assad's strongest supporter, giving Moscow sole rights to oil and gas production in Syria. 61

RELATED Russia blames Israel for shootdown of military jet over Syria

 

In a sense, Russia is the perfect candidate to monopolize such an offer. Moscow remains unafraid of sanctions against Assad's regime while Putin himself faces similar restrictionsby Western leaders. If Russia wishes to realiae a long-term goal of turning Syria into an energy transit hub for unrestricted sales in Asia, it will be expected to pump $30 billion or more into restoring Syria's energy infrastructure. In exchange, Russia will have a stronger presence in the Middle East and the eastern Mediterranean. Anyone courting Syrian energy will be expected to flatter Putin the oil tsar as much as Assad himself. And the proximity to China as a market is especially attractive at a time when Sino-Russian relations are blossoming. 122

Gazprom is well-placed to represent Russia's expansion into Syria. Gazprom has groomed its relationship with Assad over the years, so much so that a rival offer by Qatar to construct a gas pipeline was brushed aside by the Syrian leader, who cited his country's excellent relations with the Kremlin and Gazprom specifically as the preferred operator of new hydrocarbon fields. 61

 

https://www.upi.com/Energy-News/2018/09/18/Gazprom-could-be-the-new-force-in-Syria-when-troops-leave/1211537272569/

 

 

 

[3n1]

thanks pitcher, syria just shot down a russian spy plane over syria , of course Putin immediately laid the  blame on Israel , Putin's soul purpose is controlling syria and the oil he would never upset his buddy Assad .... cheers 

[Pitcher]

Yes, I saw that.  Here is what President Trump said,

 

https://www.thebaghdadpost.com/en/Story/31549/Trump-Seems-Syria-was-behind-downing-of-Russian-plane

 

The article above about Russia is troubling. They are definitely spreading their tentacles further into the ME.  Vlad isn’t stupid, he wants to control as much of the world’s oil as he can.  

[Pitcher]

The Biggest Risk In Today’s Oil Markets

The oil market is “tightening up,” but the Trump administration could still spoil oil prices if its aggressive trade war against China drags down economic growth.

The U.S. stepped up the trade conflict with China on Monday when the Trump administration announced $200 billion in tariffs on Chinese imports. The move had been expected for weeks but trade proponents had hoped that the administration would ultimately shelve the idea when push came to shove.

Not only did Trump move forward with punitive tariffs on China, but he also hinted that another $267 billion in tariffs are under consideration.

The trade war could hit the oil and gas markets in several ways. First, the back-and-forth escalation of tariffs could drag down economic growth. The first round of tariffs, which hit $50 billion in Chinese goods, targeted a relatively narrow set of products. But the latest $200 billion in tariffs will raise the cost for a wide array of consumer goods in the U.S., which could slow the economy. Specific industries that are affected by the tariffs will see more concentrated damage.

Second, oil and gas are likely to be specifically affected by the trade war, which wasn’t the case in the previous rounds of tariffs. China announced $60 billion in retaliatory measures on Tuesday, which included a 10 percent tariff on imported LNG from the United States.

The problem with the trade fight is that once the tariffs are in place, there is pressure on both sides not to back down. That doesn’t bode well to a swift resolution of this conflict. Related: Colorado’s Oil Industry Braces For A Devastating Blow

Over the longer-term, the tariff upends the economics of building new LNG export terminals in the United States. China has emerged as the main driver of LNG demand growth, and any new export terminal located anywhere around the world likely has China at the center of its calculations. According to S&P Global Platts Analytics, China is expected to make up a third of global demand growth through 2023, with consumption rising by 154 percent over 2017 levels.

 

If the business case for new export terminals in the U.S. no longer look compelling because of tariffs from China, other projects around the world could receive a boost. “The US is one of the world's main LNG suppliers, but other countries are capable of supplying China-- including Australia, Qatar, Malaysia and Russia," Stephen Comstock of the American Petroleum Institute told S&P Global Platts.

For now, China has declined to put tariffs on U.S. crude oil. In fact, China has stepped up purchases of oil from the United States over the past two years. However, Beijing could be reserving that option for the next round of escalation, such as in retaliation for the potential $267 billion in further tariffs that Trump has threatened.

New tariffs on U.S. crude might not necessarily spoil the oil market directly. U.S. crude exporters could find other buyers, but they might have to discount their oil more heavily. China, in turn, would buy oil from elsewhere, so the effect would be to scramble trade flows rather than fundamentally disrupting them. Related: Why WTI Could Crash In The Coming Weeks

The larger effect on the oil market would come from the negative impact on the global economy. “So far, the trade conflict between the US and China has had no visible impact on oil demand in either country. Crude oil processing in the US and China is at or near a record level,” Commerzbank wrote in a note. “However, the more the tariffs continue to spiral, the more likely it is that there will be a negative impact on the economy and oil demand of the world’s two largest oil consumers. What is more, it is conceivable that China will also slap a punitive tariff on US crude oil. This has not been the case as yet.”

 

Meanwhile, China could explore other ways to make life difficult for the Trump administration, such as doing its best to buy as much oil from Iran as possible. China has sent mixed signals on how much it might pare back on Iranian oil imports, even as it rejected the legitimacy of sanctions. However, with the trade war escalating, China might take a more aggressive stance on helping Iran avoid the impact of sanctions.

For now, there was little visible impact on oil prices. On Monday and Tuesday, oil prices did exhibit any significant price swings. However, prices were arguably much more muted than they otherwise might have been. News broke that Saudi Arabia was content to let Brent rise above $80 per barrel, a development that normally would send prices soaring. It’s possible that traders discounted that news due to the escalating trade war between the U.S. and China.

 

https://oilprice.com/Energy/Energy-General/The-Biggest-Risk-In-Todays-Oil-Markets.html

[yota691]

Asian refiners increase US crude exports

19/9/2018 12:00 am   WASHINGTON (Reuters) -  Asian refiners turned their attention to the United States after receiving huge discounts. He explained that US crude oil exports to Japan and South Korea reached record highs this month, with refiners in these countries benefiting from huge discounts of up to $ 10 a barrel offered by US vendors after they lost Chinese customers amid the trade dispute between Washington and Beijing. . A record increase rose oil exports from the United States to South Korea in September to a record average of at least 230 thousand barrels per day. Accompanied by an increase in US shipments to Japan also to a record average of at least 134,000 barrels  per day. South Korean and Japanese refiners need to find an alternative to offset the drop in their imports from Iran as a result of recent US sanctions over the cancellation of the nuclear deal. A reasonable amount of these (alternative supplies) come from the United States, It is difficult to resist the big discount for WTI  crude from  Brent. Price advantage , in turn , said Kim Woo - kyung, a spokeswoman for "SK Innovation", the owner of the company "SK Energy" major refiners in South Korea , "without a doubt that our purchases from the American College of crude oil back to the price advantage  of competition."  A spokesman for JXT Nippon Oil & Energy, Japan's largest refiner, said his company had not received orders from the government to stop importing Iranian crude so far, commenting on commercial operations only by saying, "We will determine the optimum crude In   our procurement plan . " India's imports , the second-largest buyer of Iranian crude after China, trimmed orders from Iran while importing more US crude, but without giving exact figures  . Japan and South Korea are among Iran's top oil customers who have succumbed to US pressure and cut orders from Iran, OPEC's third largest oil producer, with South Korea importing its last shipment in July, trade data showed. Supply shrinking Baker Hughes, an energy services firm, said US crude companies cut the number of diggers by two last week to 860. The number of rigs has stabilized since May after recovering since 2016, following a sharp collapse the previous year as   crude prices fell .   Expectations are that supply in the market will decline as US drilling activity and imminent sanctions against Iran stabilize.  While Washington is pressing other countries to cut imports from Iran, it is urging other major producers to raise production   so prices will not rise too much. Price war Oil prices are a source of concern for US President Donald Trump and his Republican Party candidates in the congressional elections scheduled for November 6, and it seems that global oil prices are rising due to fears of sanctions on Iranian oil exports, which will be renewed by Washington on the fourth of November, It is unclear what the United States will offer to major oil producers in return for increased   crude production .  OPEC and non-OPEC officials are due to meet later this month in Algeria to discuss proposals to share an increase in oil production after the two groups decided in June to increase output moderately.

[Pitcher]

Germany Blinks First In Ongoing European Gas War

By Tim Daiss - Sep 19, 2018, 12:00 PM CDT

The U.S. is increasingly finding itself at odds against not only Beijing as Trump executes a sledge hammer approach to ongoing trade disputes with China, but also with Moscow, a potentially more lethal and unpredictable opponent both geopolitically and on the energy front.

Much of Washington’s angst with Russia includes the country’s annexation of Crimea in 2014, it's meddling in recent U.S. elections, being on opposing sides in the ongoing Syrian Civil War and having differing views over energy security for Europe.

Russia, for its part, with its long-entrenched hold on European gas markets, seeks to solidify its grasp by keeping its gas monopoly largely unchallenged and also by pushing through with Russian energy giant Gazprom’s controversial Nord Stream II gas pipeline project.

Nord Stream 2 is a 759 mile (1,222 km) natural gas pipeline running on the bed of the Baltic Sea from Russian gas fields to Germany, bypassing existing land routes over Ukraine, Poland and Belarus. It would double the existing Nord Stream pipeline’s current annual capacity of 55 bcm and is expected to become operational by the end of next year.

Washington has long opposed the pipeline, claiming that it undermines EU security, which the U.S. is obliged to defend. Russia and most EU members counter that it’s purely a commercial development. Trump lambasted the EU in July, accusing them of being “captive” to Russian gas and called on Germany to stop its support for the $11 bn gas pipeline.

Germany has been the strongest supporter of the pipeline and claims it’s needed to increase natural gas supply as some EU members move away from nuclear for power generation.

Many within Germany have also maintained, even vehemently, that Washington’s resistance to the Nord Stream 2 project is purely in its own self-interest since its cancellation would increase EU members’ need for alternative gas supplies, including U.S. LNG imports.

Germany rethinks its strategy

Now, however, German is rethinking its energy security strategy. Uniper, a major German electric utility, said on Monday it’s ready to import LNG into the country and distribute it should a terminal be built at Wilhelmshaven, close to its storage facilities.

Uniper board member Keith Martin said that the company is in talks with a number of parties including those from the U.S. and that more concrete news should be announced before the end of the year.

Related: Diesel Demand Is Set To Soar

Martin said the company could build a Floating Regasification and Storage Unit (FSRU) at Wilhelmshaven. A FSRU has several distinct advantages over a land-based LNG import terminal, including being less CAPEX intensive and also having a much shorter construction time. It is also more flexible and can be moved to other locations if needed.

Earlier this month, German firm RWE said it had secured capacity to import LNG at a planned terminal in Brunsbuettel, with a final investment decision (FID) slated for some time next year.

 

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Goodwill gesture

On Tuesday, Germany economic minister Peter Altmaier picked up the theme, stating that the country will chose where to build an LNG terminal by the end of 2018 as a gesture to the U.S. which wants to ship more gas to Europe.

“This is a gesture to our American friends,” Peter Altmaier said of plans to decide on a site for the LNG terminal.

“We have three competing cities and we will take a decision before the end of the year,” he said after meeting Maros Sefcovic, the European Commission vice president and EU energy chief. However, Altmaier pointed out that his remarks were not related to Germany’s support for Nord Stream II. Related: The Biggest Risk In Today’s Oil Markets

His comments come just a few months after the EU said it would work to increase imports of U.S. soybeans and LNG to oppose Trump’s tariff threats on EU exports to the U.S.

Turning up the heat

Despite Germany’s recent willingness to pivot toward the possibility of future U.S. LNG imports, the Trump administration is still turning up the heat over the matter. Steven Winberg, assistant secretary of fossil energy, said during a Senate hearing Thursday that the U.S. needs to increase its natural gas exports to Europe to counter Russia's increasing energy dominance in the region.

"Due to a lack of supply routes and insufficient pipeline buildout, Europe is also becoming more, not less, dependent on Russian natural gas," Winberg said. "That does not have to be the case. Our nation is endowed with vast supplies of natural gas and production is growing rapidly."

The U.S. push to capture a share of Europe’s geopolitically charged gas market, and even Germany’s willingness to appease Washington notwithstanding, at the end of the day Russian gas will remain cheaper than U.S.-sourced LNG imports.

Due to transportation and liquefaction costs, boil-off during long voyages to transport the super-cooled fuel and other charges, U.S.-sourced LNG is unable to compete head to head on a cost basis with Russian gas.

Gazprom already has a monopoly over Russia’s network of pipelines to Europe and supplies close to 40 percentof Europe’s gas. Meanwhile, Russia's gas exports to Europe rose 8.1 percent last year to a record level of 193.9 billion cubic metres (bcm), even amid concerns over Russia’s cyber espionage allegations, and its activities in Syria, the Ukraine and other places.

 

 

 

 

 

https://oilprice.com/Energy/Natural-Gas/Germany-Blinks-First-In-Ongoing-European-Gas-War.html

 

 

 

 

[yota691]

US oil production reverts to its highest level in history

 19 September 2018 08:47 PM
Direct: US oil production resumed its highest level in its history last week, an increase of 100 thousand barrels per day.

It revealed data from the US Energy Information Administration on Wednesday that the oil production of the United States rose during the week ending on September 14, from the current 10.9 million barrels per day to 11 million barrels per day.

US oil production at this level is the highest ever on weekly supplies.

According to the data, the total US oil imports rose during the same period by 433 thousand barrels per day to climb to 8.02 million barrels per day.

US crude exports rose 539,000 barrels per day (bpd) to 2.37 million bpd.

With regard to the US stockpiles of, oil inventories recorded a decline for the fifth consecutive week last week as gasoline stocks have declined by 1.7 million barrels.

By 3:03 pm GMT, the benchmark Brent crude for November delivery rose 0.1% to $ 79.12 a barrel.

During the same period, the price of Brent crude for October delivery rose 1.2% to $ 70.70 a barrel.

 

[yota691]

The price of oil continues to rise

11:14 - 20/09/2018

 

 

 

Mtabah- balances News 
stepped up oil prices for the third consecutive session, on Thursday, under a new decline in US stocks and strong demand for gasoline in the United States, also found prices in support of the indications that the Organization of the Petroleum Exporting Countries (OPEC) may not increase production to compensate for the lack of supply Iran . 
By 0611 GMT, the benchmark Brent crude rose 26 cents, or 0.3 percent, to $ 79.66 a barrel, after rising 0.5 percent on Wednesday. 
US WTI crude rose 60 cents, or 0.8 percent, to $ 71.72 a barrel, after jumping nearly 2 percent in the previous session.
US Energy Inventories fell for a fifth consecutive week to a three-and-a-half-year low in the week ending September 14, while gasoline inventories fell more-than-expected on strong demand in the off-season, the Energy Information Administration said on Wednesday. 
Management data showed inventories fell 2.1 million barrels, compared with expectations for a 2.7 million barrel decline. 
OPEC and independent producers, including Russia, are meeting on Sunday in Algeria to discuss how to distribute supply increases within their respective quotas to compensate for the shortfall in Iranian supplies. 
Sources from OPEC told Reuters that there were no plans for immediate action and that producers would discuss how to distribute the previously agreed production increase.

[yota691]

 

Trump calls on OPEC to work to reduce oil prices

 

14:59

Last updated

The time now is 03:08 PM

137

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Follow - up / Tomorrow Press: 

, called on US President Donald Trump, on Thursday , the Organization of the Petroleum Exporting Countries (OPEC) again to lower crude prices. 

"We are protecting the countries of the Middle East and others will not be safe, but they are continuing to push oil prices higher," Trump said on his Twitter page. "We'll remember that, and OPEC, which is monopolizing the market, has to push prices down now!"

"The organization and its allies are unlikely to agree on another official increase in oil production during the Algiers meeting," sources said.

[Pitcher]

Get prices down’ Trump tells OPEC

Trump highlights US security role in region

Comments come ahead of oil producers meeting in Algeria

LONDON: US president Donald Trump urged OPEC to lower crude prices on Thursday while reminding Mideast oil exporters of US security support.
He made his remarks on Twitter ahead of a keenly awaited meeting of OPEC countries and its allies in Algiers this weekend as pressure mounts on them to prevent a spike in prices caused by the reimposition of oil sanctions on Iran.
“We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices!” he tweeted.
“We will remember. The OPEC monopoly must get prices down now!”
Despite the threat, the group and its allies are unlikely to agree to an official increase in output, Reuters reported on Thursday, citing OPEC sources.
In June they agreed to increase production by about one million barrels per day (bpd). That decision was was spurred by a recovery in oil prices, in part caused by OPEC and its partners agreeing to lower production since 2017.
Known as OPEC+, the group of oil producers which includes Russia are due to meet on Sunday in Algiers to look at how to allocate the additional one million bpd within its quote a framework.
OPEC sources told Reuters that there was no immediate plan for any official action as such a move would require OPEC to hold what it calls an extraordinary meeting, which is not on the table.
Oil prices slipped after Trumps remarks, with Brent crude shedding 40 cents to $79 a barrel in early afternoon trade in London while US light crude was unchanged at about $71.12.
Brent had been trading at around $80 on expectations that global supplies would come under pressure from the introduction of US sanctions on Iranian crude exports on Nov. 4.
Some countries has already started to halt imports from Tehran ahead of that deadline, leading analysts to speculate about how much spare capacity there is in the Middle East to compensate for the loss of Iranian exports as well as how much of that spare capacity can be easily brought online after years of under-investment in the industry.
Analysts expect oil to trend higher and through the $80 barrier as the deadline for US sanctions approaches.
“Brent is definitely fighting the $80 line, wanting to break above,” said SEB Markets chief commodities analyst Bjarne Schieldrop, Reuters reported. “But this is likely going to break very soon.”

 

http://www.arabnews.com/node/1375246/business-economy

[DoD]

He shouldn't stop with OPEC, he needs to send the same message to the thieves at Exxon, Shell, BP an the rest...

[Pitcher]

LIraq Oil Exports From South Close To Record-High

S

Crude oil exports from southern Iraq are close to a record-high so far in September, averaging 3.6 million bpd as of yesterday, Reuters reports, citing sources in the know who had tracked shipping data to come up with the number. If the rate stays unchanged or rises, it will beat Iraq’s previous record of 3.58 million bpd hit last month.

It’s safe to say that Iraq, OPEC’s second-largest producer, was only too happy to boost oil production after the June 22 meeting of the cartel when members decided to start reversing their production cuts agreed in late 2016. Iraq never really managed to reduce production to its assigned quota anyway, and it was vocal against the quotas because of its heavy dependence on oil revenues as its economy is still in ruins after the war and the fight with Islamic State.

What’s more, the export rate data suggests that civil unrest, which has been rife since the summer, has not affected oil production. Indeed, any intentions on the part of protesters to try and cause production outages at oil fields have been quickly thwarted.

 

Besides the export growth, Iraq is also understandably eager to increase its oil production. However, according to at least one analyst, this will be difficult to achieve. IHS Markit’s Christopher Elsner, as cited earlier this week by Arab News, Iraq faces serious challenges in its quest for boosting its production, ranging from the current political and economic problems to lack of funds to invest in new production capacity development.

“There is a lot of investment in getting wells out of the ground. And there’s a lot of investment in exporting that oil. But the connections between the oil fields and the storage farms in the south and the export points have been what has really led to the bottlenecks in Iraq,” Elsner explained.

 

https://oilprice.com/Latest-Energy-News/World-News/Iraq-Oil-Exports-From-South-Close-To-Record-High.html

[Pitcher]

DoD, why do you call Exxon, BP, and Shell thieves?

[WheresmyRV?]

Why are we depending on the M.E. for oil when this country is has million of barrels of oil underground? Ever since Trump has taken office the US is one of the top countries in the world for drilling for oil. 

[DoD]

1 hour ago, Pitcher said:

DoD, why do you call Exxon, BP, and Shell thieves?

I will not ever forget when the banks were foreclosing on all us Americans a few years ago an the job market was very slow. The thieves of these oil companies didn't even have the dignity to not publish record quarterly profits an dividends during this time. Not saying your a thief by investing in one of these companies, just saying these people could care less about the US citizen an just want their money.

I rank these scoundrels right up there with lawyers who would sell their sister on a street corner for a dollar. Well maybe their not really thieves in the sense that I made it sound because we actually give our money to them even though it was our grocery money.

[Pitcher]

WheresmyRV, the US is now the top producing oil country in the world.  I have no idea of why we ever had to import oil from the ME especially after OPEC was formed and tried to use their oil as a weapon in 1974

 

DOD,  I believe it’s not just the oil companies that may be crooked.  If you are going to pick out one industry to label as crooks you might as well name them all.  Let’s start with your Las Vegas Casinos, I’ve lost plenty of money there, are they crooks?

How about the Banks and Wall Street, I’ve lost a lot of money in the stock market over the years, are they crooks?  I almost croaked 2 years ago taking prescribed meds by my doctor, is my doctor and big pharma crooks?  How about Computer companies and BigTech, those guys make Billions of dollars, are they crooks?   How about the food industry, the entertainment industry, those people make lots of money off me, are they crooks? One more, car companies, are they crooks?

 

Im not trying to be flippant with my response.  Full Disclosure I have many friends and family in the oil business.  I was a big investor in Exxon stock for over 35 years.  So you can see I am a little sensitive when people casually label oil companies crooked.  I’m not saying they aren’t necessarily, all I’m trying to point out is our entire financial system imo is rigged.  We can ***** about it ( which will get you no where) or figure out a way to benefit from the biggest, richest, most advanced financial system the world has ever witnessed.  

 

One more point I want to make on oil.  Do you drink bottled water, how about milk, soda, or Starbucks coffee? How much does a gallon of fancy water cost, a gallon of soda, a gallon of milk, or a gallon of Starbucks coffee?  Now let me ask you who is the crook? Oil companies have to secure a drilling lease, get a crew to drill the oil, they have to transport the oil from the ground to a refiner, refine the oil, and then transport the oil to a gas station for you to pump into your car.  That process costs millions and millions of dollars and there is no guarantee that when they drill they hit oil.  They have to do this when the price is below break even per barrel like in the mid 80’s, the late 90’s and 2015. They also do this without any investment from our government but get regulated and taxed like crazy and called ridiculous names by Democrats like Maxine Waters, HRC, and Barry.  I’m not trying to stick up for the oil companies.  They have done some terrible things to the environment but what is the alternative to carbon fuels to run your cars, make your plastics, heat and cool your homes.  There is no alternative that is cost effective yet so we use what we have and we have a lot of cheap oil and natural gas.  Without our oil companies we would be a terrible slave to the likes of the ME, Russia, Venezuela, Nigeria, etc.  

 

i believe if you’re ticked off at oil companies then you should be just as ticked off with our system which has used oil to help fuel our country’s rise to the eminence that it has enjoyed for well over 100 years.  

 

Again one one gallon of Starbucks ( which I abhor) would cost you about 25 bucks. 

 

 

[yota691]

Trump vows oil producers in the Middle East and asks them to cut prices

 

Thursday 20 September

 

 

 

 

Alsumaria News / Baghdad expressed by US President Donald Trump reiterated his displeasure of the level of oil prices, calling for " OPEC " work to reduce prices, in exchange for "protection" of America obtained by some countries in the Organization. "We are protecting countries in the Middle East that will not be secure for a long time without us, but they continue to push oil prices higher,  " Trump wrote on his official Twitter page on Twitter. " The monopoly OPEC should cut prices now, .     This is not the first time that the US president criticizes OPEC at the high level of oil prices. In April and June, he announced his country's rejection of the level of oil prices, considering it is high by the act.  Trump came ahead of an upcoming meeting of OPEC and non-OPEC producers in Algeria next week, during which producers are expected to review crude production quotas.

[Pitcher]

It’s not being talked about much but there is an over supply of oil these days.  When oil gets over 65 bucks a barrel many companies and counties pump as much as they can while the price is at a point where they can make money.  Oil can be a feast or famine business.  I’ve known many many drillers and small operators who have gone bankrupt in the oil business.