Sunday, March 25, 2018

in a dozen years of US fracking, new oil exports have exceeded all new oil production

oil prices rose to an eight week high this week, decoupling from the prices of US stock markets, which saw their worst week in more than two years, even as the same news events impacted both...US crude for April delivery started by falling 28 cents to $62.06 a barrel Monday, initially in tandem with a 1.5% drop in stocks, on fears of a potential trade war brought on by Trump's steel and aluminum tariffs...but oil prices then rose $1.34 as the April oil contract expired at $63.40 a barrel on Tuesday on fears that Trump would reimpose sanctions on Iran, thereby taking their oil exports off the market...then, in trading oil for May delivery on Wednesday, oil prices for that new front month contract rose $1.63 to $65.17 a barrel, after the EIA surprised traders by reporting an unexpected draw of crude oil from US inventories...oil prices then fell 87 cents to $64.30 a barrel on Thursday as Trump announced trade sanctions on China and China in turn retaliated against 128 American made products...however, oil prices then rallied again on Friday, rising $1.58 to an eight week high of $65.88 a barrel, after Trump appointed war criminal John Bolton, whose lies got us into Iraq and who now wants war with Iran and North Korea, as national security adviser, which oil analysts felt increased the likelihood that the U.S. would re-impose sanctions on Iran and thereby disrupt their oil flow...thus the price of the May oil contract gained $3.45, or 5.5% on the week, in the largest weekly increase for oil prices since mid-February...

meanwhile, natural gas prices drifted lower, even as cold weather forecasts lingered, as traders saw the heating season coming to a natural gas for April delivery all week, prices fell 3.7 cents on Monday, rose 2.4 cents on Tuesday, and then fell another 8.4 cents over the next three days to end the week down 3.6% at $2.591 per mmBTU, the lowest closing price in over a month...the week's natural gas storage report indicated that natural gas in storage in the US fell by 86 billion cubic feet to 1,446 billion cubic feet over the week ending Friday, March 16th, which left our gas supplies 667 billion cubic feet, or 31.6% lower than the 2,113 billion cubic feet that were in storage on March 17th of last year, and 329 billion cubic feet, or 18.5% below the five-year average of 1775 billion cubic feet typically in storage at the end of the eleventh week of the year....the average withdrawal of natural gas during the eleventh week of the year over the past 5 years has been 53 billion cubic feet, so this was the first time in 5 weeks that our natural gas withdrawals exceeded the norm, in what is still a warmer than average winter nationally...

Oil Exports vs Oil Production

this week i'd like to look at a few situations that i didn't have time for last week...the first of those regards our historical oil & oil products exports, which was inspired by the following graph that appeared on the EIA's blog Today in Energy on March 15th, and was subsequently featured as the "Chart of the Week" in the OilPrice Intelligence Report on March 20th

March 17 2018 crude oil exports through 2017

the above graph, from the EIA blogpost titled "U.S. crude oil exports increased and reached more destinations in 2017", shows average US oil exports annually in thousands of barrels per day from 1920 up until that post informs us, "U.S. crude oil exports grew to an average of 1.1 million barrels per day (b/d) in 2017...nearly double the level of exports in 2016....supported by increasing U.S. crude oil production and expanded infrastructure." you can see, prior to 2016, our oil exports were negligible, because for 40 years there had been a ban on exporting US crude to any countries other than Canada and Mexico, who were exempt from that ban through the provisions of the North American Free Trade Agreement...however, after intense pressure from the oil industry, Congress included a provision to repeal that export ban in the bipartisan budget bill of December, 2015, Obama signed it, and the oil floodgates were opened...

since that graph only shows annual data till 2017, we'll also include a graph that shows weekly US oil exports right up to the current week's report....

March 21 1018 crude exports as of March 16th

the above graph of US crude oil exports was from the weekly package of oil graphs that John Kemp of Reuters emailed out on Wednesday, after the release of the weekly EIA shows weekly US crude oil exports in thousands of barrels per day over the past 18 months, and also highlights the exact amount of our crude exports in thousands of barrels per day over a few select weeks going back to September 1st, when Gulf Coast ports were shut down by Hurricane you can see, our oil exports had only topped a million barrels per day a few times prior to that date...however, after the price of US crude fell to a 10% discount to the comparable international grade, US crude suppliers began to sell as much oil overseas as our pipeline and port infrastructure would allow, and as a result our oil exports have stayed above a million barrels per day far in 2018, our exports of crude oil have average just under 1.5 million barrels per day, compared to well under 100,000 barrels per day in the earlier years of the aughts decade (as shown on the first chart above)...that means our crude exports have increased by more than 1.4 million barrels per day over the period that horizontal drilling & fracking has become the go-to method to increase oil, hold onto that 1.4 million barrels per day increase in oil exports while we look at another graph...

March 24 2018 oil products exports thru March 16

the above graph accompanies the online EIA spreadsheet showing the weekly history of 'Total U.S. Exports of Petroleum Products', and shows our exports of such products in thousands of barrels per day...this is our exports of all the products that are produced by refining crude oil, including gasoline, diesel fuel, heat oil, jet fuel, residual fuels, propane/propylene and other petrochemical you can see, prior to the advent of fracking, our exports of such products were consistently below 1 million barrels per day (see the spreadsheet)...however, starting around 2005, our exports of these products began to rise, and as you can see from the graph above, have been averaging over 5 million barrels per day over the past 6 months, after the brief spike lower when our refining and exporting was interrupted by last year's hurricanes...hence, our total exports of products that are made from oil has increased by more than 4 million barrels per day since fracking technology has added to our domestic supply...add the increase in our exports of crude to that, and we find that our total exports of crude oil and petroleum products has increased by an average of nearly 5.5 million barrels per day over the past dozen years...

so, let us next look at our oil production history, to see how much the output from US wells has increased over that same time frame....

March 24 2018 oil production thru March 16

the above graph accompanies the online EIA spreadsheet showing the weekly history of crude oil production from US wells, and it shows that production in thousands of barrels per we can see that the oil output from legacy US oil wells was gradually decreasing in the early aughts, but save for the interruptions caused by hurricanes and similar acts of nature, stayed above 5 million barrels per day throughout that period...output from US wells then began to rise in the current decade as oil output from fracked wells was added to the conventional wells totals, and as of the most recent week topped 10.4 million barrels per day for the first time in history...thus we could estimate that output from US wells has increased by 5.3 million barrels per day over the past dozen years...but as we showed earlier in this exercise, the exports of that oil and the products from it has increased by 5.5 million barrels per day over the same period...what this simply and clearly demonstrates is that the entirety of increase in US oil production that has resulted from a dozen years fracking was not for the benefit of US consumers, but rather wholly and exclusively for the benefit of US oil companies, who've found it more profitable to supply foreign customers with oil and oil products, at the expense of the health and well being of the US citizens living in those areas where the dangerous and disruptive fracking has been taking place...

OPEC's Monthly Oil Market Report

i also want to quickly review OPEC's March Oil Market Report (covering February OPEC & global oil data), which was released on Wednesday of last week, and which is available as a free download....the first table from this report that we'll look at is from the page numbered 59 of that report (pdf page 67), and it shows oil production in thousands of barrels per day for each of the current OPEC members over the recent years, quarters and months, as the column headings indicate...for all their official production measurements, OPEC uses an average of estimates from six "secondary sources", namely the International Energy Agency (IEA), the oil-pricing agencies Platts and Argus, ‎the U.S. Energy Information Administration (EIA), the oil consultancy Cambridge Energy Research Associates (CERA) and the industry newsletter Petroleum Intelligence Weekly, as an impartial adjudicator as to whether their output quotas and production cuts are being met, to resolve any potential disputes that could arise if each member reported their own figures...    

February 2018 OPEC crude output via secondary sources

as we can see on this table of official oil production data, OPEC's oil output fell by 77,100 barrels per day in February to 32,186,000 barrels per day, from an January production total of 32,263,000 barrels per day, but that was a figure that was originally reported as 32,302,000 barrels per day, so their production for February was actually a 114,000 barrel per day decrease from the previously reported figures (for your reference, here is the table of the official January OPEC output figures as reported a month ago, before this month's revisions) you can tell from the far right column above, one of the main reasons that OPEC's February output fell by 77,100 barrels per day from the revised January figures was the decrease of 52,400 barrels per day in output from Venezuela, which continues to suffer from the effects of economic sanctions imposed by the addition, oil output from the Emirates fell by 34,300 barrels per day and oil output from Iraq fell by 25,500 barrels per day...on the other hand, oil output from Nigeria rose by 24,900 barrels per day, which left them and Iraq as the only OPEC members whose production was well in excess what their pact calls for, as can be seen in the table below: 

February 2018 OPEC output vs quota via Platts

the above table is from the "OPEC guide" page at S&P Global Platts: the first column of numbers shows average daily production in millions of barrels of oil per day for each of the OPEC members for February of this year, and the 2nd column shows the allocated daily production quota in millions of barrels of oil per day for each member, after they agreed to cut their oil output by 4% at their November 2016 meeting, and the 3rd column shows how much each country produced over or under their quota for the month...note that Venezuela alone, now 400,000 barrels per day below quota, more than makes up for smaller amounts of over production by Nigeria and Iraq, and to a lesser extent, Iran and Libya...

the next graphic we'll include shows us both OPEC and world oil production monthly on the same graph, over the period from March 2016 to February 2018, and it comes from the page numbered 60 (pdf page 68) of the March OPEC Monthly Oil Market Report...on this graph, the cerulean blue bars represent OPEC oil production in millions of barrels per day as shown on the left scale, while the purple graph represents global oil production in millions of barrels per day, with the metrics for global output shown on the right scale...   

February 2018 OPEC report global oil supply

OPEC's preliminary data indicates that total global oil production rose to a record 98.20 million barrels per day in February, up by .37 million barrels per day from a January output total of 97.83 million barrels per day, which was revised up by .15 million barrels per day from the 97.66 million barrels per day global oil output for January that was reported a month oil output for February was also 2.32 million barrels per day higher than the 95.88 million barrels of oil per day that was being produced globally in February a year ago (see last March's OPEC report online (pdf) for the year ago data)... OPEC's February production of 32,186,000 barrels per day thus represented just 32.8% of what was produced globally, their lowest on record, down from a revised 33.0% in January, as oil output increases by US, Mexico, Norway, UK, Bahrain, Brazil and Kazakhstan were only partially offset by decreases in output from Canada and Russia...OPEC's February 2017 production was at 31,958,000 barrels per day, which means that the 13 OPEC members who were part of OPEC last year, excluding their new member Equatorial Guinea, are now producing 98,000 more barrels per day of oil than they were producing a year ago, during the second month that their production quotas were in effect, with the increase from last year largely due to recoveries of oil production in Libya and Nigeria... 

the increase in global oil output that we can see in the above purple graph meant there was a surplus in the amount of oil being produced globally, as the next table from the OPEC report will show us..     

February 2018 OPEC report 2018 global oil demand

the table above comes from page 32 of the March OPEC Monthly Oil Market Report (pdf page 40), and it shows regional and total oil demand in millions of barrels per day for 2017 in the first column, and OPEC's estimate of oil demand by region and globally quarterly over 2018 over the rest of the table...on the "Total world" line of the second column, we've circled in blue the figure that's relevant for February, which is their revised estimate of global oil demand for the first quarter of 2018...  

OPEC's estimate is that during the 1st quarter of this year, all oil consuming areas of the globe will be using 97.27 million barrels of oil per day, which is an upward revision from their prior estimate of 97.23 million barrels of oil per day (which we've circled in green).....meanwhile, as OPEC showed us in the oil supply section of this report and the summary supply graph above, even after the OPEC and non-OPEC production cuts, the world's oil producers were producing 98.20 million barrels per day during February, which means that there was a surplus of around 930,000 barrels per day in global oil production vis-a vis demand during the month...

meanwhile, the 0.15 million barrels per day upward revision to January's global output offset by the 0.04 million barrels of oil per day upward revision to 1st quarter demand means that our previously computed surplus for January should be revised .11 million barrels per day higher, and thus now stands at 540,000 barrels per day...hence, for the first two months of the year, oil production has exceeded supply by roughly 42.8 million barrels...on the other hand, cumulative global oil demand figures for 2017 were revised higher by 0.02 million barrels per day to 97.01 barrels per day (also circled in green) with this report, because of a 0.09 million barrels per day upward revision to 4th quarter demand round numbers, that means our previous estimate of a 193 million barrel oil shortfall for 2017 was about 8 million barrels too low, so we can now re-estimate that the global oil deficit for 2017 was approximately 201 million barrels...

The Latest US Oil Data from the EIA

this week's US oil data from the US Energy Information Administration, covering the week ending March 16th, indicated that due to another big drop in our oil imports and a big increase in refining, we needed to pull oil out of storage for the 2nd time in the past 8 weeks...our imports of crude oil fell by an average of 508,000 barrels per day to an average of 7,077,000 barrels per day during the week, after falling 418,000 barrels per day the prior week, while our exports of crude oil rose by an average of 86,000 barrels per day to an average of 1,573,000 barrels per day, which meant that our effective trade in oil over the week worked out to a net import average of 5,504,000 barrels of per day during the week, 594,000 barrels per day less than out net imports during the prior the same time, field production of crude oil from US wells rose by 26,000 barrels per day to a record high of 10,407,000 barrels per day, which means that our daily supply of oil from our net imports and from wells totaled an average of 15,911,000 barrels per day during the reporting week..

during the same week, US oil refineries were using 16,777,000 barrels of crude per day, 410,000 barrels per day more than they used during the prior week, while at the same time 375,000 barrels of oil per day were being pulled out of oil storage facilities in the US....hence, this week's crude oil figures from the EIA seem to indicate that our total working supply of oil from net imports, from oilfield production, and from storage was 491,000 barrels per day less than what refineries reported they used during the account for that disparity, the EIA needed to insert a (+491,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the data for the supply of oil and the consumption of it balance out, essentially a fudge factor that is labeled in their footnotes as "unaccounted for crude oil"... (how this weekly oil data is gathered, and the possible reasons for that "unaccounted for" oil, is explained here)...

further details from the weekly Petroleum Status Report (pdf) show that the 4 week average of our oil imports inched up to an average of 7,487,000 barrels per day, which was still 4.8% less than the 7,863,000 barrel per day average we imported over the same four-week period last year....the 375,000 barrel per day decrease in our total crude inventories all came from our commercial stocks of crude oil, as oil stocks in our Strategic Petroleum Reserve were unchanged...this week's 26,000 barrel per day increase in our crude oil production included a 20,000 barrel per day increase in output from wells in the lower 48 states, and a 6,000 barrel per day increase in output from Alaska...the 10,407,000 barrels of crude per day that were produced by US wells during the week ending March 16th were the highest on record, 14.0% more than the 9,129,000 barrels per day that US wells were producing during the week ending March 17th of last year, and 23.5% above the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June, 2016...

US oil refineries were operating at 91.7% of their capacity in using those 16,777,000 barrels of crude per day, up from 90.0% of capacity the prior week, but still down from the wintertime record 96.7% of capacity set eleven weeks earlier, as US refineries are just coming out of their pre-spring blend changeover and scheduled maintenance season....nonetheless, the 16,777,000 barrels of oil that were refined this week was a seasonal record, the most oil that refineries ever processed during February or March...while that elevated level of refining was still 4.7% less than the off-season record 17,608,000 barrels per day that were being refined during the last week of December 2017, it was 6.2% more than the 15,801,000 barrels of crude per day that were being processed during the week ending March 17th, 2017, when refineries, still wrapping up seasonal maintenance at that time, were operating at 87.4% of capacity....

even with the increase in the amount of oil being refined, gasoline output from our refineries was lower than the prior week, decreasing by 348,000 barrels per day to 9,932,000 barrels per day during the week ending March 16th, after our gasoline output had increased by 357,000 barrels per day during the week ending March a result, our gasoline production was only 1.6% greater during the week than the 9,771,000 barrels of gasoline that were being produced daily during the week ending March 17th of last the same time, our refineries' production of distillate fuels (diesel fuel and heat oil) rose by 25,000 barrels per day to 4,503,000 barrels per day, after falling by 671,000 barrels per day over the prior 5 weeks...hence, that small increase still left the week's distillates production 6.8% lower than the 4,829,000 barrels of distillates per day than were being produced during the equivalent week of 2017....   

with the decrease in our gasoline production, our supply of gasoline in storage at the end of the week fell by 1,693,000 barrels to 243,065,000 barrels by March 16th, the third draw in a row, but just the fourth decrease in 19 weeks....our supplies were down even though our domestic consumption of gasoline fell by 318,000 barrels per day to 9,324,000 barrels per day, after rising by 782,000 barrels per day over the prior two the same time, our exports of gasoline fell by 99,000 barrels per day to 686,000 barrels per day, while our imports of gasoline fell by 40,000 barrels per day to 564,000 barrels per even after our gasoline supplies have increased during 15 of the last nineteen weeks, our gasoline inventories are now fractionally lower than last March 17th's level of 243,468,000 barrels, even as they are roughly 7.5% above the 10 year average of gasoline supplies for this time of the year...         

at the same time, our supplies of distillate fuels fell by 2,022,000 barrels to 131,044,000 barrels over the week ending March 16th, after falling by 4,360,000 barrels the prior week...our distillate inventories fell even though our exports of distillates fell by 495,000 barrels per day to 997,000 barrels per day, while our imports of distillates fell by 101,000 barrels per day to 122,000 barrels per day, and while the amount of distillates supplied to US markets, a proxy for our domestic consumption, rose by 85,000 barrels per day to 3,917,000 barrels per day...after this week’s inventory decrease, our distillate supplies ended the week 15.7% lower than the 155,393,000 barrels that we had stored on March 17th, 2017, and 7.1% lower than the 10 year average of distillates stocks at this time of the year…   

finally, with the drop in our oil imports and the increase in oil refining, we had to pull oil out of our commercial supplies of crude oil for the 11th time in 18 weeks and for the 36th time in the past year, as our commercial crude supplies decreased by 2,622,000 barrels, from 430,928,000 barrels on March 9th to 428,306,000 barrels on March 16th...hence, after sliding most of the past year, our oil inventories as of that date were 19.7% below the 533,110,000 barrels of oil we had stored on March 17th of 2017, and 14.6% lower than the 501,517,000 barrels of oil that we had in storage on March 19th of 2016, and 1.1% below the 425,047,000 barrels of oil we had in storage on March 20th of 2015, at a time when the US glut of oil had just begun to build...our oil supplies have now also dropped below their prior five year average for just the third time in 9 years, as the chart from Barron Energy below shows..   

March 23 2018 crude oil supplies as of March 17

This Week's Rig Count

US drilling activity increased for the 5th week in a row and for the 14th time in the past 20 weeks during the week ending March 23rd, a period of rising oil prices which has seen the rig increases far exceed the few decreases...Baker Hughes reported that the total count of active rotary rigs running in the US rose by 5 rigs to 995 rigs in the week ending on Friday, which was also 186 more rigs than the 809 rigs that were in use as of the March 24th report of 2017, while it was still down from the recent high of 1929 drilling rigs that were deployed on November 21st of 2014... 

the number of rigs drilling for oil rose by 4 rigs to 804 rigs this week, which was 152 more oil rigs than were running a year ago, even as the week's oil rig count still remained well below the recent high of 1609 rigs that were drilling for oil on October 10, the same time, the number of drilling rigs targeting natural gas formations increased by 1 rig to 190 rigs this week, which was also 35 more gas rigs than the 155 natural gas rigs that were drilling a year ago, but way down from the recent high of 1,606 natural gas rigs that were deployed on August 29th, addition, a single rig that was considered "miscellaneous" continued drilling this week, down from the two such "miscellaneous" rigs that were operating a year ago.

drilling in the Gulf of Mexico was unchanged at 13 rigs, still the lowest number of rigs working in the Gulf this century, & down by 5 rigs from the 18 rigs that were deployed in the Gulf of Mexico a year the same time, a rig which had been working on an inland lake in southern Louisiana was shut down this week, leaving three such inland waters rigs still active, down from the 4 inland waters rigs that were working in southern Louisiana a year earlier...

meanwhile, the week's count of active horizontal drilling rigs rose by 5 rigs to 870 horizontal rigs this week, which was also up by 197 rigs from the 673 horizontal rigs that were in use in the US on March 24th of last year, but down from the record of 1372 horizontal rigs that were deployed on November 21st of the same time, the vertical rig count was up by 6 rigs to 63 vertical rigs this week, which was still down from the 78 vertical rigs that were in use during the same week of last year...on the other hand, the directional rig count was down by 6 rigs to 62 directional rigs this week, which was still up from the 58 directional rigs that were deployed on March 24th of 2017...

the details on this week's changes in drilling activity by state and by shale basin are included in our screenshot below of that part of the rig count summary pdf from Baker Hughes that shows those changes...the first table below shows weekly and year over year rig count changes for the major producing states, and the second table shows the weekly and year over year rig count changes for the major US geological oil and gas both tables, the first column shows the active rig count as of March 23rd, the second column shows the change in the number of working rigs between last week's count (March 16th) and this week's (March 23rd) count, the third column shows last week's March 16th active rig count, the 4th column shows the change between the number of rigs running on Friday and the equivalent Friday of a year ago, and the 5th column shows the number of rigs that were drilling at the end of that reporting week a year ago, which in this week’s case was for the 24th of March, 2017... 

March 23rd 2018 rig count summary

with the drilling increase in the Permian of west Texas exceeding the total increase nationally, it almost looks like this week is a return to the pattern of last spring, when drilling in the Permian surged while activity in the rest of the country stagnated...but you wouldn't guess from looking at the table above that the natural gas rig increase was in the Cana Woodford of Oklahoma, which happened to have 6 oil directed rigs shut down at the same time...that leaves the Cana Woodford with 57 oil rigs and two gas rigs, the largest natural gas deployment in that basin since February the same time the Utica, which had gone from zero oil rigs seven weeks earlier to 8 oil rigs last week, saw one of those oil rigs shut down this week, while the Utica's natural gas rigs remained unchanged at 16 rigs...and in addition to the major producing states shown on the table above, Mississippi also saw a rig added this week, and now has 4 rigs running, which is the same number they had running last March 24th...


Could A Fracking Byproduct Help Defrost Roads? Ohio Legislators Think So – WOSU - The first day of spring is bringing a Winter Weather Advisory in Central Ohio. And while the snow begins to come down, legislators in an Ohio House committee will be considering a new way to remove ice from the roads - using the byproduct of fracking. HB 393, which was introduced in October, would allow for the sale of fracking brine for surface applications, like deicing roadways during Ohio's slick winters. The bipartisan bill is co-sponsored by Republican state Rep. Anthony Devitis and Democrat state Rep. Michael O'Brien.O'Brien says a particular company, Aquasalina, processes brine from hydraulic fracturing wells to make it usable."Whether it be residential deicing, for something as simple as one sidewalk," he says, "or sell to road departments for the county road departments, the city street departments and such, for the deicing method for the winter months."O'Brien says the method is environmentally sound. But some environmental groups, like the Sierra Club of Ohio, disagree."There’s been some great research on this, showing it does not matter what kind of oil and gas well this fluid comes from, it has hazards in it," says Cheryl Johncox, an organizer with the group. "We’re opposed to this bill opening up for additional broader use on roads in the state of Ohio." Her group believes more regulatory oversight is needed to ensure the product is safe for use on roadways.

Complaints About Falsified Pipeline Endorsements Draw No Response - Dozens of people haven’t heard back from U.S. regulators nearly two years after their names were falsely used in letters supporting approval of a gas pipeline from Ohio to Canada, lawyers for the complainants said.  An energy-lobbying group that was backing the pipeline, which hasn’t been built, generated the comments falsely attributed to the Ohio residents—and later said it had happened inadvertently. Twenty-three people said in sworn affidavits to the Federal Energy Regulatory Commission in 2016 that they never submitted letters to the agency in support of the pipeline that were sent in their names. Fifteen other expressions of support for the pipeline were identified separately as fakes and sent to FERC, according to documents filed with the agency.“Nothing has come of it—yet,” said Debby Christy, a retired draftsperson for a manufacturing firm who first identified the fakes. Ms. Christy lives outside Medina, Ohio, near the proposed pipeline’s route, and opposes the project.FERC has approved the pipeline project, but the decision is being appealed at FERC and in federal court.A FERC spokeswoman, Mary O’Driscoll, said the agency received and entered into the record the affidavits saying an earlier filing was fraudulent. “We tell complainants that they should file with the U.S. Postal Service,” Ms. O’Driscoll said. She didn’t explain why she recommended the Postal Service and wouldn’t answer whether the comments came in via U.S. mail or over the internet. The Postal Inspection Service​ public-affairs office wouldn’t say whether it is looking into the matter any further, per usual policy. The people who filed complaints said they haven’t received any response from postal inspectors.Statements of support or in opposition to a policy change by FERC or other regulatory agencies can influence outcomes of regulatory decisions that affect millions. A Wall Street Journal investigation last year uncovered thousands of people whose names and email or address were used to post bogus comments—a federal crime—on websites of agencies including the Federal Communications Commission and Consumer Financial Protection Bureau.

Anti-frackers in Y'town keep tilting at windmills - Youngstown Vindicator -- A group of self-appointed guardians of Youngstown are at it again, pushing an amendment to the city’s home-rule charter that is clearly unconstitutional. Sensible Youngstown voters rejected the issue six times, and the Ohio Supreme Court made sure the so-called Community Bill of Rights wasn’t on the ballot last year. But the anti-frackers, led by Ray and Susie Beiersdorfer, won’t take “no” for an answer. They’re going back to the high & transcripis nothing more than an exercise in futility, we urge the court to issue an unequivocal opinion. It’s time to send the anti-frackers a clear message that their effort to ban hydraulic fracturing in the city of Youngstown is misguided and unconstitutional. The Ohio Constitution gives the Ohio Department of Natural Resources exclusive authority to oversee the fracking process to extract oil and gas from beneath the earth’s surface. Organized opposition from the business and labor communities has centered on the practical aspect of the so-called bill of rights. Jobs tied to the drilling industry in the city, including hundreds at Vallourec Star, would be threatened. The amendment is also without foundation because there are no companies with serious plans to drill for oil and gas within the city limits. That’s why we have dismissed the committee’s numerous attempts to win over the electorate as nothing more than self-aggrandizing.

Lawmaker Seeks Ban On Fracking In Public Parks – WVXU - A central Ohio lawmaker is seeking a ban on fracking in certain parts of the state. The proposal comes as a commission that regulates this types of drilling prepares for its first meeting.  Democratic Representative David Leland wants to prevent oil and gas companies from drilling in public parks and nature preserves.Leland says he understands the economic value of fracking for natural gas in Ohio, but…“We’ve got to have little spots of land in the state of Ohio that don’t have to be subjected to fracking. We can run an economy, we can get our energy needs in the state of Ohio and still preserve the state parks and nature preserves for people to use not only now but in the future,” said Leland.The practice of horizontal drilling and hydraulic fracturing, or fracking, on public lands must be approved by the Ohio Oil and Gas Commission. For years Gov. John Kasich didn’t appoint members to the commission, but last year’s budget fight forced his hand.

Feds Auction Fracking Leases That Threaten Ohio's Only National Forest - Center for Biological Diversity (press release) - For Immediate Release, March 22, 2018 — The U.S. Bureau of Land Management today will auction 345 acres of Ohio’s only national forest, the Wayne National Forest, for oil and gas fracking despite a recently filed protest showing fracking could endanger drinking water and wildlife. The leases would lock in dangerous fracking in the Wayne. Despite known threats from fracking pointed out by the conservation groups’ protest, the BLM planned the auction using only a cursory review that avoids site-specific analysis of potential harm. That means the public will have no information about pollution risks to streams, eradication of endangered species habitat and harm to nearby communities, which is required under the National Environmental Policy Act. “The Bureau of Land Management is unlawfully cutting corners in its push to develop the Wayne. Our protest filing is intended to rein in the agency,” said Nathan Johnson, attorney for the Ohio Environmental Council. “The Wayne is one of Ohio's finest natural treasures, plain and simple. It deserves to be protected from heavy industrial development.”The auction comes after the U.S. Forest Service announced plans to revise its 2006 forest plan governing land management in the Wayne. Conservation groups last year sued the Forest Service and the BLM, which oversees drilling and fracking of federal oil and gas. The lawsuit says federal officials relied on the outdated plan and failed to analyze threats to public health, water, endangered species and the climate before opening 40,000 acres of the Wayne to fracking.“This wild forest is being sacrificed for fracking based on a dangerously outdated plan that ignores major risks to public health and wildlife,” said Wendy Park, an attorney at the Center for Biological Diversity. “The lack of transparency in this process is disturbing. The Forest Service needs to listen to the public and spare Ohio’s only national forest from fracking industrialization and contamination.”

Gubernatorial candidate tours southeastern Ohio fracking and mining sites - The Columbus Dispatch --A March 9 fossil fuel extraction tour of Southeastern Ohio, guided by area residents included Dennis Kucinich, candidate for governor, who requested the tour to gain a firsthand look at oil and gas development in the area. The tour also offered the candidate an opportunity to speak with local residents who have been affected by fracking. Many fracking and coal mining sites were visited in Belmont, Noble, Monroe and Guernsey Counties including the Exxon-owned XTO Schnegg well site near Powhatan Point that exploded February 15th and was recently capped after leaking for 23 days.  The tour was led by Jill Hunkler of the Barnesville area and Kerri Bond of the Senecaville area. Both have been negatively affected by the oil and gas infrastructure near their homes and were glad to share their stories with those on the tour. Kucinich said, "I talked to a woman who lives in this area and she told me there was a chemical film on their homes, cars, and on their land. They don’t want to grow any food this year because they’re worried there could be poison in the soil." Residents also expressed their concern to Kucinich regarding the potentially negative health impacts from the lengthy exposure of toxins from the leaking well.Witnessing the many water lines servicing frack pads throughout the countryside, Kucinich stated: "Fracking uses enormous amounts of water. On average, it takes 11,000,000 gallons of water to frack one well. When you consider that in some of these counties they’re building thousands of wells, that means not millions, but billions of gallons of fresh water will be permanently contaminated and removed from the hydrologic cycle.""This is happening right at the time when our water resources are increasingly scarce globally. It is time for us be asking the question: What do we want, water or oil and gas? Why are we being put in a situation with energy policies, where we are told we have to sacrifice water?""The oil and gas industry is syphoning water out of reservoirs, rivers and streams and often paying a minimum, if anything at all, for the water. This water is the basis of life, but our lives are being put at risk for oil and gas here in southeastern Ohio." Kucinich added.

Dennis Kucinich Finds Fracking Facts in Southeast Ohio: A Horror Story - By the time you hit Cambridge, Ohio, driving south from Cleveland on interstate 77, your eyes will likely have begun to itch. Your insides will likely have been subject to a nettling discomfort, a weird, sourceless pressure. It will feel, inexplicably, as if your lungs are nauseous. Such is the density of chemicals in the Southeastern Ohio air that you'll experience these physical sensations inside your vehicle. At least I did, when I joined a handful of environmental and community activists, plus Dennis and Elizabeth Kucinich, a documentarian and a college professor on an "Environmental Devastation Tour" earlier this month. Others in our tour van were likewise afflicted by the elements. In Noble County, where fracking pads dotted the hills like lesions, Elizabeth Kucinich asked if someone might open a window. The air in the van had become not only warm, but thick. The air outside was colder, thankfully, but provided little relief.  There was no "fresh air" to be gotten for miles, I realized, an epiphany belied by the region's forests, hills and streams in view. This sylvan quadrant of Ohio had once been among the state's most naturally beautiful areas, one of its most "precious" areas, in the words of Kucinich. But the land — the atmosphere itself — had been poisoned. "Look at the trees," Kucinich remarked more than once, pointing at the gnarled and dead branches that lined the state routes as often as not. "The trees!" Kucinich is the former Cleveland Mayor, U.S. Congressman and current Democratic gubernatorial candidate for Ohio. He has made "clean air and water" a campaign pillar. Along with a full ban on assault weapons and healthcare for all, the quest for clean air and water has been as central to his agenda and his talking points as anything. But the quest is Quixotic. He has said that if elected, he would move to ban fracking, high-pressure drilling for natural gas in the shale formations deep below the earth's surface. He told the Intercept that he would block all new drilling permits and would ban injection wells too.

Ohio Officials Mount Investigation Into Gas Well Explosion – WOSU - Just over a month ago, an explosion at a Utica shale drilling site in Southeast Ohio's Belmont County forced evacuation of nearby homes. It took nearly three weeks to cap the well. Investigators are now sorting out what happened, and how to keep it from happening somewhere else.Dave Ivan, director of Belmont County Emergency Management, says one thing was clear in the February 15 emergency: the coordinated state and local response plan works. “The State of Ohio had devised a ‘one call,’” Ivan says. “When something happens on one of these pads the producer makes one phone call and notifies a bunch of different agencies at just about the same time.” That includes the Ohio EPA and the state’s Department of Natural Resources.  “With that one call, this was reported right around 9:30, and by 11:00-11:30, we had state folks over here already in the area,” Ivan says.“We were able to secure the well,” says Karen Matusic, a spokesperson for XTO Energy, which owns the well pad. “And we reinforced the well, so that we are able to undergo our investigation. And then, once the investigation is over and we are able to very closely check the integrity of the well, we’ll determine what we are going to be doing with that well.”The well that blew out was one of four on a pad near Powhatan Point on the Ohio River, about 20 miles downstream from Wheeling, W.Va.  It was being readied to go into service when the explosion occurred.  XTO has more than 40 horizontal shale wells in Belmont County. In total, Eastern Ohio has 2,317 shale wells, and 495 more permitted for drilling.

Appalachian Basin remains active for shale producers – The Appalachian Basin remains a very busy place.Nearly 2,300 drilling permits were issued in 2017 in the three-state basin, with 1,036 of those wells being spud, said energy consultant Timothy Knobloch.That includes 1,377 Pennsylvania permits, 462 Ohio permits and 459 West Virginia permits, said Knobloch, president of James Knobloch Petroleum Consultants, of Marietta, Ohio.In comparison, there were 1,178 Pennsylvania permits, 267 Ohio permits and 246 West Virginia permits issued in 2016, and only 771 wells were spud, he said. The wells spud in 2017 jumped 34.3% from 2016, Kallanish Energy has learned.The Appalachian Basin has spud nearly 15,0000 wells: 10,123 in Pennsylvania; 2,750 in West Virginia; and 2,229 in Ohio, he said.Final figures are not yet available, but it appears between 700 and 1,000 wells were drilled in the Appalachian Basin in 2017, Knobloch said. There are 11,600 horizontal wells in the basin that are producing, he said.Drilling is picking up as oil and gas prices rise and pipelines are completed to get Appalacvhian Basin natural gas to markets, he said. The Marcellus and Utica shales in the basin are expected to produce 35% of the natural gas in the U.S. by 2020.

Ohio tops Gulf Coast for oil, gas in study - If you are an energy company with a few billion dollars to spend, Ohio is a much more profitable place to invest than the Gulf Coast, according to a new report that would have seemed audacious just a few years ago.The report, by IHS Markit, was financed by an Ohio economic-development group and is part of a broader campaign to attract the petrochemical industry to the parts of Ohio, Pennsylvania and West Virginia that sit atop the Utica and Marcellus shale formations.By taking on the Gulf Coast, the economic center of the U.S. oil and gas industry, backers of Ohio energy efforts hope to call attention to the rapid growth of the Utica and Marcellus as a producer of natural gas and natural-gas liquids. The liquids, such as ethane, propane and others, are used in making plastics and chemicals. The Utica and Marcellus regions accounted for about 30 percent of U.S. gas production last year, based on December figures from the Energy information Administration.Shale Crescent is seeking to appeal to companies such as PTT Global Chemical of Thailand, which is considering whether to move forward with a $5 billion to $10 billion petrochemical project it is contemplating in Belmont County. Last week, the company announced it has a new partner for the project, Daelim Industrial Co. of South Korea, which increases the chances of development. IHS found that a large petrochemical plant in the Shale Crescent region, which includes parts of Ohio, Pennsylvania and West Virginia, would earn $3.6 billion more in profit than a similar plant in the Gulf Coast from 2020 to 2040. The difference is because of Ohio’s plentiful water and natural-gas liquids, which leads to lower costs, and because the region is closer to ultimate customers than the Gulf Coast, which reduces transportation costs.

Region could lead North America in natural gas production - Marcellus and Utica shale natural gas deposits throughout Appalachia have the potential to change the natural gas industry in North America, officials said today. Representatives of Shale Crescent USA are at the World Petrochemical Conference this week in Houston, Texas. Shale Crescent USA has been involved with natural gas development efforts in West Virginia, Southeastern Ohio and Southwestern Pennsylvania and the Mid-Ohio Valley. Shale Crescent USA, IHS Markit and Solvay spoke today in a telephone press conference about a report prepared by IHS that will be presented Wednesday at the conference as for industry executives. “Benefits, Risks, and Estimated Project Cash Flows: Ethylene Project Located in the Shale Crescent USA versus the U.S. Gulf Coast” is a report by IHS Markit commissioned by Shale Crescent USA to evaluate and compare the financial returns and risks of a major petrochemical and plastics investment in the region with an identical investment in the U.S. Gulf Coast, which currently leads the world in petrochemical manufacturing expansion. “The Marcellus and Utica shale plays are some of the largest natural gas resources in the world and underlay the Shale Crescent USA region of Ohio, Pennsylvania and West Virginia,” the introduction of the report stated. “IHS Markit forecasts that this region will supply 37 percent of the nation’s natural gas production by 2040.”

Could Shale Gas Lead To A Manufacturing Boom In Appalachia? - Coal’s downfall has exacerbated Appalachia’s economic struggles. But the emergence of shale gas has the potential to help liberate the region, although critics are concerned that such production would also leave an indelible environmental footprint that could do more harm than good. A new study says that the Utica and Marcellus Shale basins will provide 37% of the nation’s natural gas production by 2040, making it the best place nationally for manufacturers to invest — even better than the Gulf Coast. IHS Markit concludes that the region, which is made up of Ohio, Pennsylvania and West Virginia, and which it calls Shale Crescent USA, will “provide a significant financial advantage” when compared to the Gulf Coast. It specifically refers to chemical plants, which would use “wet” natural gas as a feedstock to manufacture end products like plastics. Those so-called natural gas liquids are comprised of such chemicals as butane, ethane, methane and propane. “The IHS Markit Analysis predicts that an ethylene project in the Shale Crescent USA region will produce a net present value in 2020 … of $930 million over the life of the project compared to a net present value of $217 million for a similar projects on the US Gulf Coast,” the study says, which was commissioned by Shale Crescent USA. The analysis adds that Ohio, Pennsylvania and West Virginia have an advantage because their supplies are closer to where the shale gas would be consumed, and because of abundant fresh water supplies — a region that holds an estimated 141 trillion cubic feet of recoverable natural gas. It further notes that 900 chemical plants are already in the region, with most of those in Ohio.In 2000, shale gas accounted for 5% of all gas production in the United States and today it is about 60%, according to U.S. Energy Information Administration. Steel, chemical and fertilizer manufacturers are among the beneficiaries. Those industrials were paying as much as $14 per million Btus in 2005 and now it is about $2.70 for the same unit, which IHS Markit says will lead to an additional $328 billion in new manufacturing output by 2025.

Shale Crescent USA could challenge Gulf Coast petrochemical industry, study says — A new study says the Shale Crescent — Ohio, West Virginia and Pennsylvania — has the potential to supplant the Gulf Coast as the nation’s petrochemical hub. IHS Markit’s study, commissioned by Shale Crescent USA, looked at the risk-reward of developing cracker plants and downstream opportunities in the crescent vs. the Gulf Coast. The study predicts substantial cost savings for companies investing in the Shale Crescent — 32 percent on ethane prices, and cash cost savings of 23 percent on ethylene and 16 percent on polyethylene, with a 23 percent savings on polyethylene delivered costs — primarily because it’s located virtually on top of the gas fields, is within a day’s drive of customers throughout the Midwest and Northeast and has an abundant supply of fresh water.The conclusion: Investing $3 billion in an ethylene facility would bring $3.6 billion in pre-tax profit advantage over 20 years.“The Shale Crescent is more profitable than the Gulf Coast under all three scenarios, primarily driven by feedstock advantages and transportation costs associated with having a plant right on top of the gas fields and close to customers,” Whitfield said.  Jerry James, a volunteer director for Shale Crescent USA, said feedstock prices are a key driver. “In the petroleum business, that’s the supply of natural gas and natural gas liquids, particularly ethane.“We think that this will be a very good opportunity for investors to look at Shale Crescent USA for locating ethane and polyethylene cracker and downstream units,” he said. IHS predicts the tri-state region will supply 37 percent of the nation’s natural gas production by 2040 and notes the U.S. has become the No. 1 natural gas producer.

Lancaster, Pennsylvania: Locals Take Over Pipeline Office, Then Occupy Drill Rig - Something extraordinary happened in Lancaster County yesterday.  A busload of fifty local residents took over the field offices of Williams/Transco at 805 Estelle Drive, Suite 101, in Lancaster. We dropped a 12 foot stretch of pipeline in Williams’s meeting room, sang songs through the hallways, and slapped a Condemnation Notice on the door before leaving. When a Williams employee complained about our visit, one of our residents deadpanned: “Sucks to be invaded, doesn’t it?”   Our message was simple and direct: we the people, whose lives and land are under assault by this toxic piepline, openly defy the “right” of dirty energy giants to profit at the expense of our health, safety, water, and land.From there, the bus headed down to southern Lancaster County where Williams is drilling under the Conestoga River and desecrating federally recognized indigenous graves. The HDD process they’re using is the same one now contaminating drinking water along the Mariner East 2 pipeline.We walked off the bus and sang our way straight onto the worksite, right past the workers, and up onto the drill rig itself. After police arrived, five bold residents locked arms and stood atop that monstrous machinery for another three hours, shutting down operations for the rest of the day. By day’s end, the Drill Rig Five were arrested while defending our community. It’s a perversion of justice that law enforcement are sued to protect the financial interests of energy giants in Oklahoma over the health and safety of local residents. We look forward to the day when fossil fuel billionaires are stuffed into police cruisers for sabotaging our children’s future, rather than those of us peacefully working to protect that future.

Sunoco, regulators get a withering review at Pa. Senate hearing on Mariner East pipeline problems -  Pennsylvania environmental regulators were aware for days thatcollapsed soil along the path of the Mariner East pipeline construction project had exposed a parallel pipeline in Chester County this month before they informed safety regulators at another agency, according to testimony at a state Senate hearing on Tuesday.Instead, safety inspectors with the Pennsylvania Public Utility Commissionfirst learned about the sinkholes from local residents on March 3.Four days later, the commission ordered an emergency shutdown of the exposed pipeline, known as Mariner East 1, to avoid potentially “catastrophic results” until the ethane, butane and propane pipeline’s stability can be confirmed.Domenic Rocco, who runs the state Department of Environmental Protection’s regional permit coordination office, acknowledged that department officials did not notify the PUC when they first recognized subsidences related to Sunoco Pipeline’s Mariner East pipeline expansion project in November and only belatedly communicated with the PUC when more sinkholes appeared this month.  . “If you’ve been in better contact since November, it certainly wasn’t shown in this situation.”If any entity received more critical attention than the DEP during the joint committee hearing in Harrisburg, it was Sunoco Pipeline — the Energy Transfer Partners subsidiary whose cross-state Mariner East expansion project is designed to ferry vastly more natural gas liquids from western to eastern Pennsylvania. State senators and residents along the pipeline’s path repeatedly rebuked the company, arguing that the project’s mounting environmental and communication failures have created a backlash that is making it difficult for other companies to build natural gas infrastructure in Pennsylvania.

Pennsylvania says bankrupt refiner owes $3.8 billion in taxes: filing (Reuters) - The state of Pennsylvania wants a federal judge to halt the bankruptcy of Philadelphia Energy Solutions (PES), arguing the refiner owes an estimated $3.8 billion in fuel taxes, according to a court filing on Friday. The state’s Department of Revenue said the refiner must make several changes to the proposed restructuring plan to ensure the taxes are paid before it can support the plan. The $3.8 billion figure is significant for a refiner that had just $43 million in cash on hand when it filed for bankruptcy protection in January. The tax liability stems from a pending audit of the company’s books, the state says, and could be adjusted pending the outcome. “The Commonwealth believes, however, the final audit may produce a substantial liability which could impact the feasibility of the Debtors’ Plan,” state attorneys wrote. The tax issue stems from unpaid fuels taxes, interest and penalties from 2015 to January of this year, court documents show. A state spokesman on Monday said it could not provide any more details beyond the filing because of taxpayer confidentiality. The state needed to file a claim to ensure the tax liability is not forgiven as part of the bankruptcy, and the high figure was likely a bargaining tactic, Chris Ward, chair of the Polsinelli law firm’s bankruptcy group, said.

Letter: With coal's rise, gas boom, WV again in pact with Devil (Gazette) - Charleston Gazette-Mail -- Coal production is up; fracked gas prices are up; pipelines crawl across the tri-state region like eels racing for prey; a cracking plant finds life in nearby Potters Township, Pennsylvania, and hope for a new multi-billion dollar plant abounds for Dilles Bottom, Ohio. Empty coffers and politicians’ pockets are being filled. Life is promising in the tri-state area. Unfortunately, West Virginians, Eastern Ohioans, and Western Pennsylvanians once again find themselves locked into pacts with the Devil. The handshake: Jobs traded for long-suffering sickness and early deaths. Thrown into the bargain is a hell on earth for those nonparticipants within proximity of the fossil fuels seizures. Coal production is on the upswing, thanks to the president’s trashing of environmental regulations; therefore, the Devil’s acolyte, coal, has been pulled from its dark existence to once again hover over the Appalachian landscape.Thanks to China, a proposed investment of $78 billion in West Virginia emerges. The Devil’s Minotaurs, gas and oil, will receive carte blanche to pray on Appalachian health.Thanks to a cracking plant conquering the landscape in Potters Township and a future possibly in Dillies Bottom, centaurs — Shell — must be fed humans; PTT Global awaits its chance to seduce Appalachia farther south on the Ohio River and reap environmental chaos.  In those three states, sacrificing one’s health and, inadvertently, the health of one’s relatives and neighbors for jobs has been a practice as venerable as reading Greek mythology. The jobs, albeit not many in fracking and cracking, will pay a living wage until the resources are exhausted, and then it’s back to gloom and financial doom. Residents’ sickness will once again creep from generation to generation: The culprits are kidney and liver disease from well water; asthma from surface mining particles assaulting the air; chemical-treated waste from coal slurries, gas fracking methane and covert chemicals seeping into groundwater; these life-threatening diseases take decades to destroy their host.

U.S. Fourth Circuit of Appeals says Mountain Valley Pipeline project can continue - — EQT's Mountain Valley Pipeline project can continue, the U.S. Fourth Circuit of Appeals ruled Wednesday. Appalachian Mountain Advocates, which represents several environmental groups, including the Sierra Club, brought a lawsuit against the U.S. Army Corps of Engineers that claimed the corps had improperly issued a permit for the 303-mile pipeline. The lawsuit sought an order to halt construction on the project.  Judges in the Fourth Circuit responded to the lawsuit with one sentence: “Upon consideration of submissions relative to petitioners’ motion for preliminary relief, the court denies the motion.”Natalie Cox, an EQT spokeswoman, said the company understands the position of Appalachian Mountain Advocates, but applauds the court's ruling. "While we appreciate the support we have received across the region, we understand that the efforts and progress we have made to plan and design a pipeline route that will protect cultural and historic resources, as well as preserve sensitive and environmental species, may not satisfy those opposed to underground, natural gas infrastructure," she said. "We are pleased with the court’s decision and look forward to continuing the MVP construction activities and working with landowners and stakeholders on this important infrastructure project." On Tuesday, Monroe County Circuit Judge Robert Irons issued an order lifting a restraining order against protesters who have been sitting in trees along the pipeline route. Irons issued the ruling less than two weeks after granting the Mountain Valley Pipeline a 10-day restraining order against the protesters. Mountain Valley Pipeline had sought the restraining order, saying the protesters could prevent cutting trees along the pipeline's path in time to meet a March 31 federal wildlife protection deadline.

Pipeline Leaks 42,000 Gallons Into Indiana Stream -- Forty-two thousand gallons of diesel spilled from a Marathon Petroleum Corporation pipeline into Big Creek in Posey Creek, Indiana before the leak was detected Tuesday evening, U.S. News & World Report reported Wednesday.  The pipeline was immediately shut off, and workers contained the spill with two booms before it reached the Wabash River. Kevin Turner, the on-the-scene coordinator for the U.S. Environmental Protection Agency (EPA), told The Indianapolis Star that it was "considered a large spill."   Fortunately, Turner told The Star that he did not think the spill would impact wildlife. No fish deaths have yet been reported, and it is too early in the year for migratory songbirds to have arrived, he said.  The spill traveled four miles before it was stopped by the booms. "If the product had made it to the Wabash, then we would not be able to collect any of it," Turner told The Star.  Marathon was moving the fuel from its refinery in Robinson, Illinois to its terminal on the Ohio River in Mount Vernon, Indiana.  Turner told The Star that efforts were now underway to recover the fuel, a process that should take about a week. He expected 60 percent of the diesel to be skimmed. According to The Star, this is not the first time that a Marathon pipeline has leaked. In April 2016, 48,300 gallons of oil spilled into the Wabash River from a pipeline near Mount Carmel, Illinois near the Indiana border. That leak was caused by the fact that erosion had exposed the pipeline, which had been buried beneath the river, to the river bottom itself.

Health Professionals: Fracking Can’t Be Done Without Threatening Public Health - Fracking for oil and gas poses an impending health crisis in the U.S., two leading groups of health professionals warn in a new report. Not only do existing fracking regulations fail to protect Americans from increased risk of cancer, asthma and birth defects, but there is no evidence fracking can ever be done without threatening public health, according to the authors.  The report, by Concerned Health Professionals of New York and Physicians for Social Responsibility, pulls together studies, data and news reports on the health and environmental impacts of hydraulic fracturing of natural gas and oil wells. In fracking, a slurry of water, chemicals and sand is injected deep underground at drilling sites. The chemicals and chemical-laced wastewater can contaminate drinking water and send hazardous emissions into the air, endangering people who live nearby, as well as workers at drilling sites. One of the report’s authors, Dr. Sandra Steingraber, told Rolling Stone that in her long career as a biologist, environmental writer and advocate, “Fracking is the worst thing I’ve ever seen.” She continued:Those of us in the public health sector started to realize years ago that there were potential risks, then the industry rolled out faster than we could do our science. Now we see those risks have turned into human harms and people are getting sick. And we in this field have a moral imperative to raise the alarm. The report is the fifth edition of a yearly compendium that details extensive studies on increased risks of cancer, asthma and birth defects for people who live near fracking sites. For example:

Fracking Report Finds Unacceptable Risks / Public News Service -- The fifth Fracking Health Compendium finds that the oil and gas drilling technique poses high risks to food, water and the climate, and cannot be done safely. The report is a compilation of the rapidly growing body of scientific research into the process that injects heavily treated water into deep shale formations to free trapped natural gas and oil. According to Sandra Steingraber, a biologist and co-founder of Concerned Health Professionals of New York, much of the research into the health and safety concerns of fracking comes from here in Pennsylvania. "What it shows is that fracking is not safe and cannot be made safe through any regulatory framework,” she says. “And the risks that we had concerns about in the early days, now we have evidence for actual harm." Proponents of fracking say 250,000 fracked wells in operation around the country have proved that the process is environmentally safe. But Steingraber – currently the distinguished scholar in residence in the Department of Environmental Studies and Sciences at Ithaca College – points out that in areas close to fracked wells and infrastructure, there are increased rates of asthma and other respiratory ailments – and among infants, various impacts such as lower birth weight, birth defects, and lower scores on infant development. "We know from previous research that early life and prenatal exposure to chemicals like we know are coming out of fracking operations are indeed related to these kinds of outcomes," says Steingraber.

Oil, gas, and the effects of environmental racism (video) Jamali Maddix talks with an environmentalist about how drilling for fuel usually means pushing contamination into the places where lower-class people live.

Proposed Norwalk fracking ban moves to public hearing -   — The Ordinance Committee voted to hold a public hearing about proposed regulations banning fracking waste from being stored, processed or used in any products within Norwalk. The hearing will take place in City Hall on April 17 at 7 p.m.If such regulations are passed, Norwalk would join over three dozen cities and towns in Connecticut that have already prohibited fracking waste using very similar language.Fracking is a practice in which water is forced deep in the ground to create cracks, releasing natural gas and oil. The water is mixed with chemicals that aid the process — for example, dissolving minerals or reducing frictions — and within the ground, that water can be exposed to radioactive deposits occurring naturally in the earth. Once the fluid serves its function and finds its way back to the surface, companies are faced with the question of what to do with the waste.Companies in Pennsylvania, the closest state to Connecticut that allows fracking, have taken to shipping that waste to other states, such as Ohio and New Jersey, said State Rep. Jonathan Steinberg, who has pushed for state regulation of fracking waste. However, to his knowledge, fracking waste has never been shipped to Connecticut.The state voted to pause fracking waste within the state until July 1, 2018, when regulation would be deferred to the Connecticut Department of Energy and Environmental Protection. Residents afraid that the new regulation may allow fracking waste urged the city to pass its own laws against it. At the last Ordinance Committee meeting, the room overflowed with people there to hear the council members’ thoughts and express their own opinions on the matter. All those who spoke were in favor of a ban of the waste in Norwalk.

Opposition to offshore drilling hardening in Massachusetts (AP)— Opposition to a Trump administration proposal to allow oil and gas drilling in coastal waters, including those off the Atlantic coast of Massachusetts, continues to grow on Beacon Hill. Just this week, Massachusetts Attorney General Maura Healey announced she's considering taking legal action against the administration to protect "the people, economy and natural resources of Massachusetts from the grave risks posed by unprecedented oil and gas leasing." "Despite concerns from the fishing industry, clean energy developers, marine scientists and thousands of residents up and down the coast that depend on a healthy ocean, this administration has repeatedly ignored the serious economic and environmental risks of offshore drilling," Healey said as she filed comments with the U.S. Bureau of Ocean Energy Management opposing the plan. Healey isn't alone. Fellow Democratic attorneys general from a dozen coastal states, including neighboring Rhode Island and Connecticut, have also written Interior Secretary Ryan Zinke protesting the drilling plan. Other critics include Republican Gov. Charlie Baker, Democratic U.S. Sen. Edward Markey and the state's entire Democratic congressional delegation as well as members of the fishing and tourism industries and environmental groups. Zinke continues to defend the plan, which faces fierce opposition in states along the entire West Coast and much of the East Coast. Florida was dropped from the plan after the state's Republican governor and lawmakers pointed to risks to the state's tourism business. 

Back-door ban: States fight Trump drill plan with local bans — Some coastal states opposed to President Donald Trump’s plan to allow oil and gas drilling off most of the nation’s coastline are fighting back with proposed state laws designed to thwart the proposal. The drilling Trump proposes would take place in federal waters offshore in an area called the Outer Continental Shelf. But states control the 3 miles of ocean closest to shore and are proposing laws designed to make it difficult, or impossible, to bring the oil or gas ashore in their areas. States including New Jersey, New York, California, South Carolina and Rhode Island have introduced bills prohibiting any infrastructure related to offshore oil or gas production from being built in or crossing their state waters. Washington state is threatening such a bill. Maryland has introduced a bill imposing strict liability on anyone who causes a spill while engaged in offshore drilling or oil or gas extraction. “We started thinking about how we control the first three miles of ocean, and there are state rights that we have,” said New Jersey state Sen. Jeff Van Drew, a Democrat who represents the state’s southern coast. “Even if we don’t succeed in banning it outright, we can still make it a lot more expensive to do it in this area. It’s a back-door, ingenious way to block this.” California Democratic state Sen. Hannah-Beth Jackson said a ban on pipelines and docks could force the industry to rely on ships that would then have to sail to the waters of a different state to bring their cargo ashore. “What we can do is make drilling for offshore oil and gas so prohibitively expensive that it won’t pencil out,” she said.

Natural Gas – New England: LNG-by-rail to the rescue? - The Massachusetts legislature has adopted a very green agenda in recent months, which has resulted in a stance against fossil fuels that some critics are pointing to as counterproductive, in terms of greenhouse gas emissions.  The State has opposed gas pipeline expansion in the region, one of the most energy dependent parts of the US for winter supplies of gas and LNG for both heating and electricity generation.  Some have pointed at the recent import of gas originating from the new Yamal LNG export facility in Russia (of which the second arrived just this week) as a negative and unwanted consequence of the lack of pipeline capacity.  Electric generators in New England are also having to consider oil-fired peaking generators as a result of potential gas shortages, with double the carbon of the equivalent gas-fired plant. Another possible consequence of the “anti-gas pipeline” stance being taken is that novel technologies are being looked at to move gas around, some of which GCA has been following in less developed jurisdictions.  For example, LNG-by-rail, which has only been permitted so far for the Alaska Railroad Company (since 2015) appears to be emerging as one way to alleviate the winter gas shortages in New England.  Based on ISO containers placed on flatbed trucks, the technology represents a potentially viable and cost-effective way of shipping LNG over land.  At sufficient scale, LNG-by-rail has a number of advantages over trucking by road, where GCA estimates the cost penalty is of the order of US$1/MMBtu for every one hundred miles, an order of magnitude costlier than a high-pressure transmission line.

How Climate Activists Failed to Make Clear the Problem with Natural Gas - Bill McKibben - Last week, the New Orleans City Council — all Democrats — voted 6-1 to approve a big new gas-fired power plant. Sometime in the coming weeks, in Orange County in upstate New York, another vast new gas power plant is expected to go on line — as soon as it’s hooked up to a new pipeline, one of literally dozens planned across the country. Local opponents — environmentalists, community activists — are fighting hard, but somewhere, almost every day, a new piece of natural gas infrastructure goes up. When I think about my greatest failing as a communicator — and one of the greatest failings of the climate movement — it’s not that global warming still continues. Stopping it cold was always too high an order: The fossil fuel industry is so rich and powerful, and hydrocarbons so central to our economy, that this battle was always going to be uphill. At best we can limit the damage, and in that we’ve made at least some progress. No, the single most annoying failing is a more technical one, but with huge consequence: Public opinion — and especially elite opinion — still accepts natural gas as a cleaner replacement for other fossil fuels. And this acceptance — nearly as strong among Democrats as Republicans — has meant that we’ve seen huge increases in the use of natural gas. In fact, our essential global warming strategy in America has been to replace coal-fired power plants with ones that run on fracked gas.  The idea that natural gas combats climate change is a sleight of hand. But explaining why appears to be just slightly too technical for it ever to get across, in the media or on Capitol Hill, in statehouses or city halls. Still, I’ll try one more time.

Natural gas under assault in some states after brief reign at the top - Natural gas overtook coal as the top fuel for making electricity in the U.S. two years ago. But its brief reign is under assault in some parts of the country. State regulators, renewable-energy advocates and environmental groups are arguing that some existing and proposed gas plants aren’t needed or should be replaced by renewable energy. In states including Arizona, Michigan and Massachusetts, the future of gas plants is being questioned. But nowhere is gas under more fire than in California, where regulators are saying no to new gas plants and looking to get rid of older ones. Earlier this year, the California Public Utilities Commission directed the state’s largest utility, Pacific Gas & Electric , to solicit bids for renewable energy and storage projects to replace three costly gas plants.   Power companies in California also recently abandoned plans to build two gas plants, a result of the state’s preference for batteries, wind farms and solar panels. California’s move away from natural gas is driven by aggressive environmental goals, including getting 50% of its power from renewables by 2030. Currently, 30% of California’s power comes from renewables, according to the state.  “It is fair to say it will be very challenging to see new natural gas resources being built in California.”  Gas is under pressure in other areas, including Arizona, where regulators last week voted for a nine-month pause on any new large gas-powered plants. The Arizona Corporation Commission told the state’s largest investor-owned utilities that their future plans relied too heavily on natural gas and should include more renewables, electricity storage and energy efficiency. Natural gas accounted for nearly 32% of U.S. power generation in 2017, up from about 22% a decade earlier, according to federal data. Coal is now 30%, after falling from 49% over the same time span. Nuclear accounted for 20% in 2017, and wind and solar combined totaled 8%, rising from less than 1% a decade ago.  Gas is projected to remain the top electricity-maker in the U.S. over the long term, according to federal forecasts, but its growth could be limited by increased use of renewable energy.

FERC's move on MLPs and cost-of-service rates puts Wall Street in a tizzy - The aftershocks are still being felt from last Thursday’s decision by the Federal Energy Regulatory Commission (FERC) that interstate gas and liquids pipelines’ cost-based tariff rates can’t include anything for income taxes if the pipelines are owned by master limited partnerships (MLPs) — and most are. Many investors did freak out — no other phrase sums it up better — when they heard that news. Share prices for midstream companies plummeted in midday trading, and we imagine that many angry calls were made by investors to their financial advisers. “Why didn’t we know about this?!” In fact, although this proceeding had been simmering for a while, FERC’s action was harsher than expected by most experts. But the impact of the change is likely to be less far-reaching than the Wall Street frenzy would have you believe, at least for most MLPs. And, by the way, the issue at hand — whether and how to factor in taxes in calculating MLPs’ cost-of-service-based rates for interstate pipelines –– has been around for decades. Today, we discuss FERC’s new policy statement on the treatment of income taxes and what it means for natural gas, crude oil, natural gas liquid (NGL) and refined product pipeline rates; and for investors in MLPs that own and operate the systems.

Maryland regulators approve Potomac River gas pipeline - Maryland regulators will allow a Canadian energy company to route a controversial natural gas pipeline through the state and beneath the Potomac River, but will subject the project to safeguards they say will protect the river and groundwater.The state’s decision was announced Friday, the deadline for acting on the environmental permit application that Columbia Gas, a subsidiary of TransCanada, submitted a year ago.Maryland Department of the Environment Secretary Ben Grumbles said the state is holding the project to almost two dozen environmental conditions that he said “go above and beyond” requirements already imposed by the Army Corps of Engineers and the Federal Energy Regulatory Commission. They include monitoring of wells, limitations on the types of fluids used in drilling and notifications of any pollution events.“After a year of robust, public review, the state is insisting on extra precautions and safeguards,” Grumbles said in a statement. “The bottom line is that this pipeline will not get built if the applicant doesn’t comply with our many requirements, regardless of what the federal agencies ultimately decide.” Environmental groups that have been protesting the project were not appeased. They have called on Gov. Larry Hogan to order a more extensive environmental impact study to ensure that Potomac River drinking water and groundwater aren’t contaminated.

Protester Arrested At State House: Gov. Hogan Would Not Drink Water Contaminated by Fracking: Jean Cushman is one of five woman who were arrested on the steps of the Maryland State House last week. After standing in the cold and singing “We Shall Overcome” for two hours, they were handcuffed and driven to a nearby police station. “It was pretty cold out and we saw some snow. The wind was blowing quite a lot - it was not comfortable,” she said. The five expected to be arrested sooner. “We think the reason that it took so long to arrest us is because Governor Hogan didn’t like the optics of arresting women with gray hair who have children and/or grandchildren,” Cushman said. The women were protesting the routing of a natural gas pipeline through western Maryland, beneath the Potomac River. Despite this action and others on the part of environmental advocates, two days later, Maryland officials issued a permit for the Columbia Pipeline to TransCanada, the company known for its Keystone XL Pipeline. Cushman said this news came as no surprise. “I don’t think we’d expect a lot of concern about safety from [Maryland Department of Energy Secretary] Ben Grumbles.” The Maryland Department of Energy has said it will subject the pipeline to “special environmental conditions” to protect land and drinking water.

Atlantic Coast Pipeline can't enter some private properties, federal judge says   -- As the Atlantic Coast Pipeline doubles down on slashing trees on hundreds of private properties in North Carolina, a federal judge has taken the unusual step of barring the energy consortium from clearing trees on two rural homesteads.  U.S. District Judge Terrence Boyle said the interstate pipeline developer must first pay the two landowners before its chainsaw crews can enter their properties.  The ruling comes as the planned 600-mile natural gas project, which is already more than a year behind schedule, is running up against deadlines that could add months to the construction timeline. Led by Charlotte's Duke Energy and Richmond's Dominion Energy, the Atlantic Coast Pipeline plans to bring vast supplies of natural gas to North Carolina from fracking operations in Pennsylvania and West Virginia.  The pipeline developers say they face a March 31 deadline to cut down trees before the start of the nesting season for migratory birds in Eastern North Carolina. Anticipating delays, the Atlantic Coast Pipeline last Thursday asked for a six-week federal extension, until May 15, to buy time and get the tree-cutting out of the way so workers can spend the summer and autumn trenching and laying pipe. If granted an extension, the pipeline company has vowed to visually survey every tree for nests and eggs, promising to avoid chopping down bird-occupied trees until the newly hatched fledgelings have flown away.In last week's private property dispute, Boyle rejected the Atlantic Coast Pipeline's arguments that its schedules and corporate priorities are in the public interest and should take precedence over the concerns of the local landowners. In his decision Friday, the judge was unmoved by the pipeline developers' urgent plea that they must begin cutting trees as soon as possible, or risk blowing the deadline and being forced to delay construction on the $6 billion project until next winter.  Boyle ruled that Enfield township fire chief Ronnnie Locke and Marvin Winstead Jr., a 67-year-old Nash County farmer, presented a compelling case that the Atlantic Coast Pipeline's landmen were uncommunicative or deceptive in their dealings, and the facts will need to be sorted out at trial, if Locke and Winstead don't choose to settle with the company.

Gasoline Traders Are Paying One Another for Line Space Again  - The rent is rising on America’s largest gasoline pipeline as traders send excess Gulf Coast supplies east. Traders with gasoline to spare in the U.S. Gulf Coast have paid as much as 2 cents a gallon to get their barrels a ticket to the East Coast this week, according to Moataz Elmasry, quantitative oil trader at Castleton Commodities. Oil-market price reporting agency Argus Media Ltd. assessed the value as high as 3 cents last week. The price is on the uptick after refineries in Texas and Louisiana cut back their spring maintenance this year, softening fuel prices in the region. “Line space has been negative until recently,” Elmasry said from London. “It’s now positive due to weakness in the Gulf Coast, which is driven by a reduction in refinery outages.” Despite the recent enthusiasm to ship gasoline east, market intelligence service Genscape is reporting New York Harbor stockpiles sank by 1.1 million barrels last week, according to people familiar with the matter. The dip gave the front-month gasoline futures spread a jolt higher in morning trade on the New York Mercantile Exchange. Colonial declined to comment.  Colonial is the biggest single supplier of gasoline to the New York market,  “Rather interestingly and somewhat amazingly, in the last two years there’s been a number of times that Colonial Pipeline has gone slack,”  “It has consistently been over-nominated over history. It’s gone slack. Why? Because the trade flows on occasion change.” 

Bill to ban fracking for oil and gas dies in Florida Legislature again - Florida lawmakers again wrapped up a legislative session without writing regulations for fracking and stimulated oil-drilling techniques.  A bill to ban such practices, filed by state Sen. Dana Young, R-Tampa, died in a Senate subcommittee after progressing through another. It did not get a hearing in the House.  "We're disappointed, but we're hopeful about next year when the leadership is likely to change in the House," said Amber Crooks, environmental policy manager at the Conservancy of Southwest Florida. "We hope the next speaker will let the bills be heard and come to a vote."  The next House speaker is expected to be state Rep. Jose Oliva, R-Miami Lakes, if Republicans maintain their majority in the chamber.

‘Keep it in the ground' activists optimistic despite oil boom (NPR) - The United States oil business is booming and the country could soon be the largest crude oil producer in the world. Despite this record-breaking production, climate change activists campaigning to move away from fossil fuels say they are making progress. Here's the idea underpinning the "keep it in the ground" movement: To address climate change, activists say known reserves of fossil fuels will have to be left untouched instead of burned. In the meantime, they want countries to transition to renewable forms of energy such as solar and wind. For oil, activists figure that if they can stop pipelines and other infrastructure from being built, it's more likely crude will be left in the ground, because there won't be a way to transport it to where it can be sold. One tactic used to block pipeline construction is protests like those against the Bayou Bridge Pipeline in Louisiana. Last month organizer Cherri Foytlin led cheers of "L'eau est la vie"—"water is life" in French — near Belle Rose, Louisiana. Environmental groups sued to stop construction of the pipeline, but if building continues, Foytlin says she's prepared to physically block it. "We're poor people. We don't have a lot of money like they do. All I have is this old body. ... So I'll use this old body now to do what I have to do to stop it," she says 

Judge rules Bayou Bridge pipeline can continue building through Acadia Parish property - A state judge on Monday ruled against an Acadia Parish landowner who wanted to halt construction of a 163-mile oil pipeline until resolution of a federal lawsuit aimed at shutting down the project. The 163-mile pipeline crosses 11 south Louisiana parishes, including Acadia Parish, where Hope Rosinski owns 6 acres on which Bayou Bridge Pipeline LLC last year obtained rights to build after initiating expropriation action. Rosinski came to terms with Bayou Bridge in August for undisclosed compensation, and the company acquired an easement to access the property. Judge Kristian Earles on Monday granted a preliminary injunction in favor of Bayou Bridge, effectively extending an initial restraining order to prevent Rosinski from interfering with construction. The company is ultimately seeking a permanent injunction to uphold the easement agreement.  Rosinski had asserted in a March 4 email to Bayou Bridge that construction within her property was prohibited because of U.S. District Judge Shelly Dick’s Feb. 23 ruling that pipeline construction in the Atchafalaya Basin must stop while a lawsuit against the U.S. Army Corps of Engineers is pending.That suit, brought by environmental groups, claims the federal government erred in its permitting of the pipeline, and Rosinski’s easement agreement with Bayou Bridge allows construction through her land only once the company has obtained all necessary permits. The 5th Circuit Court of Appeal last week overruled Dick, allowing construction to move forward. Rosinski’s attorney, Matthew Long, argued Monday in 15th Judicial District Court in Lafayette that the appellate court had merely stayed Dick’s ruling, without vacating or overturning it. Bayou Bridge contends Dick’s ruling didn’t invalidate its permits in the first place.

LNG and pipeline reversals turn Louisiana gas market upside down, part 2. The supply-demand dynamic in Louisiana — and around the national benchmark pricing location Henry Hub — is rapidly changing, with LNG exports providing a new demand source in the state and both producers and midstreamers in high gear to push more supply there. These factors will disrupt existing flow patterns and pricing relationships in the region over the next two or three years, eventually turning the market entirely on its head. Today, we continue our series on the Louisiana market transformation with a detailed look at the infrastructure and gas flow trends already underway, starting with what’s going on in the eastern half of the state. As we laid out in Part 1 of this series, the Louisiana market is in the midst of a significant transformation. What used to be primarily a supply market is becoming the epicenter of demand growth from LNG exports, which in turn are making the state the most desirable destination market for U.S. gas supply. Offshore gas production from the federal waters of the Gulf of Mexico has been rapidly receding. There is a slew of Marcellus/Utica takeaway projects in the works to reverse existing pipes or build new pipeline capacity in order to access the Gulf Coast market (seeFill Me Up Buttercup). These pipes are expected to bring a deluge of supply to the Louisiana market. And, after years of decline, Louisiana’s own Haynesville Shale is also in growth mode again. These shifts will alter the Louisiana market balance and the traditional understanding of gas flows and pricing relationships in the region. That’s a big deal considering that Louisiana is the home state of the Henry Hub — the national benchmark pricing location for the U.S. spot gas market and the physical delivery point underlying the CME/NYMEX natural gas futures contract. Another location — the Perryville Hub — will also play an increasingly critical role as an axis point for distributing interstate supply targeting Gulf Coast demand.

The United States exported more natural gas than it imported in 2017 – EIA - The United States exported more natural gas than it imported in 2017, marking the first time since 1957 that the United States has been a net natural gas exporter. The transition to net exporter occurred as natural gas production in the United States continued to grow, reducing pipeline imports from Canada and increasing exports, both by pipeline and as liquefied natural gas (LNG).  Natural gas production in the United States increased significantly over the past decade. The United States surpassed Russia in 2009 as the world’s largest natural gas producer as shale gas production drove overall increases in natural gas production. Most recently, production increases have been concentrated in the Appalachia region—primarily the Marcellus and Utica shales. Natural gas production reached an average of 73.6 billion cubic feet per day (Bcf/d) in 2017, a 1% increase from the 2016 level and just slightly lower than the 2015 record level.  As the United States has produced more natural gas, particularly from the Appalachia region, pipeline imports from Canada have decreased. As new pipeline capacity comes online in the region, more natural gas can be delivered to regions in the Midwest and Northeast, displacing Canadian imports and increasing U.S. pipeline exports to Canada.  U.S. natural gas pipeline capacity into Mexico has also increased over the past few years, driven by growth in demand for natural gas from Mexico’s power sector and favorable prices compared with natural gas supplied by LNG shipments. U.S.-Mexico natural gas pipeline capacity is currently 11.2 Bcf/d, with another 3.2 Bcf/d of capacity scheduled to be added later in 2018. Pipeline exports to Mexico have grown along with pipeline capacity, more than doubling since 2014 and averaging 4.2 Bcf/d in 2017.

NYMEX Apr natural gas a touch higher in early activity - NYMEX April natural gas futures were a touch higher early Monday, having seesawed overnight as moderate weather associated with spring looked to keep demand subdued and allow for a changeover from weekly storage withdrawals to injections.At 7:20 am ET (1120 GMT), the contract was 0.7 cent higher at $2.688/MMBtu, having traded in a range from $2.675/MMBtu to $2.697/MMBtu.Although below-average temperature readings linger in midrange forecasts, the arrival of the spring shoulder season spells higher low temperatures likely to keep a lid on heating demand ahead of the onset of significant cooling load. The National Weather Service 6-10 day outlook showed below-average temperatures enveloping the bulk of the West, a few parts of the Midwest, nearly the entire Northeast and much of the mid-Atlantic into a corner of North Carolina.

NYMEX April gas futures little changed at $2.656/MMBtu -- NYMEX April natural gas futures traded on either side of unchanged in the US overnight, managing to drift fractionally higher ahead of Tuesday's open. At 7:10 am ET (1110 GMT) the contract was 0.5 cent higher at $2.656/MMBtu, trading in a range of $2.650-$2.667/MMBtu. While participants are eyeing weather outlooks and anticipated warmth as spring officially begins at 12:15 pm ET on Tuesday, cold weather in the mid-range period continues to drive modest upside support amid lingering demand that should keep natural gas inventories eroding. As spring takes hold, the National Oceanic and Atmospheric Administration is projecting warmer-than-normal weather for much of the country from April through June. Providing upside support, however, the market will have to contend with the implications of the current and mid-range cold as storage withdrawals are expected to continue. 

NYMEX Apr natural gas rises 1.0 cent to $2.648/MMBtu on storage expectations - NYMEX April natural gas futures retraced higher overnight ahead of Thursday's open. At 6:55 a.m. ET (1055 GMT) the contract was 1.0 cent higher at $2.648/MMBtu. Weather that generated 4.6% more heating degrees days than normal in the week to March 17 is expected to have encouraged a substantial inventory withdrawal in the storage report due out Thursday. Analysts looking to the data covering the week ended March 16 anticipate withdrawals spanning 85-93 Bcf, with consensus formed at 90 Bcf. While a storage data within the range of outlooks would trail the 137 Bcf year-ago draw, it would exceed the 53 Bcf five-year average pull. Working gas in storage is currently 1,532 Bcf, or 718 Bcf below the year-ago level and 296 Bcf below the five-year average, after the Energy Information Administration outlined a 93 Bcf drawdown in the week ended March 9. 

Weekly Natural Gas Storage Report: April Is Starting Out On A Bullish Note - The EIA reported a -86 Bcf change in storage, bringing the total storage number to 1.446 Tcf. This compares to the -150 Bcf change last year and -53 Bcf change for the five-year average. Going into this storage report, a Reuters survey of traders and analysts pegged the average at -87 Bcf with a range of -77 Bcf to -99 Bcf. We expected -88 Bcf and were 1 Bcf above the consensus. We were off by 2 Bcf on this storage report. The first week of April is projected to be colder than normal with HDDs higher for the first five days. The end result is that storage is now expected to be 1.324 Tcf by April 6. We wrote in our last week's weekly natural gas recap that traders shouldn't count out a cold April. With the first week now expected to be colder than normal, the latest long-range forecast also shows the bullish weather pattern to continue. While natural gas prices will increasingly react less to weather model changes and more to fundamental variables such as production, the rangebound trading opportunity presented will still be very attractive. In our view, with winter weather volatility ending, knowledgeable natural gas traders can take higher conviction positions because weather will no longer be the only variable that matters.  For now, however, we don't see an attractive trade set-up. Overall, weather is expected to start April on a bullish note. Traders shouldn't ignore what a bullish April could do to gas storage, and the trading opportunity will present itself. 

Natural Gas Storage Math - How Much Supply Do We Need In 2018 -- Just how much Lower 48 production do we need for the 2018 injection season? Answer - ~80 to ~80.5 Bcf/d average from April to November 2018.  This is the mathematical breakdown of why this is the case. First, we are exiting 2018 withdrawal season at ~1.405 Tcf (latest EOS).  If we exit this year at 1.405 Tcf, this leaves a storage deficit of 2.424 Tcf to the five-year average end of injection season storage level - 3.829 Tcf.In 2017, we exited withdrawal season at 2.060 Tcf, and saw a total build of 1.728 Tcf.The five-year average shows a build of 2.119 Tcf during injection season.  So taking the delta needed in 2018 for storage to reach the 5-year average by November to the difference we saw in 2017, we get a difference of 696 Bcf (2.424 Tcf needed vs 1.728 Tcf last year). What's changed in fundamentals since 2017?

  • First, 696 Bcf over 31-weeks (injection period) is 22.45 Bcf per week or 3.2 Bcf/d.  In 2017's injection period, Lower 48 production averaged ~72.7 Bcf/d. 3.2 Bcf/d + 72.7 Bcf/d = 75.9 Bcf/d
  • LNG and Mexico exports in 2017 average ~6.2 Bcf/d in 2017. In 2018, we are forecasting this to average ~8.2 Bcf/d or +2 Bcf/d y-o-y.  75.9 Bcf/d (previous needed supply) + 2 Bcf/d = 77.9 Bcf/d
  • At current STRIP pricing, power burn demand will be 1.5 to 2 Bcf/d higher y-o-y assuming summer is normal.  77.9 Bcf/d + 1.75 Bcf/d = 79.65 Bcf/d
  • Industrial demand to add ~0.3 to ~0.5 Bcf/d of demand in 2018.  79.65 Bcf/d + 0.4 Bcf/d = 80.05 Bcf/d

Of course, this calculation doesn't make a preliminary assumption on what weather will be over the summer, so the supplies needed could be either higher or lower than this baseline figure, but you can see the math.

Wilbur Ross to China: Import More U.S. Gas to Cut Trade Deficit -- What would it take for China to reduce its trade gap with the U.S.? Buy more natural gas, for a start, says Secretary of Commerce Wilbur Ross. Diverting its purchases from other countries to America would be the “simplest” solution, Ross said during an interview with Bloomberg TV after President Donald Trump ordered tariffs on at least $50 billion in Chinese imports. Buying more U.S. liquefied natural gas would be a step in that direction, he said.“China needs to import very, very large amounts of LNG and from their point it would be very logical to import more of it from us, if for no reason other than to diversify their sources of supply,” Ross said. “It would also have the side effect of reducing the deficit.”Though LNG imports may help the deficit, which reached $375 billion last year, they are unlikely to put a big dent in it, Anastacia Dialynas, analyst at Bloomberg New Energy Finance, said in a research note. Chinese LNG imports may grow to 82 million tons by 2030; if the country bought all of that from the U.S., it could contribute almost $28 billion to the trade balance.But that’s unlikely because China already has commitments for most of their gas with other suppliers. Only 40 million tons of China’s 2030 imports aren’t already under contract, amounting to just $13.5 billion in revenue at current prices, according to BNEF.“So can LNG shipments solve the U.S.-China trade deficit? No. Could they help? Yes. Will they increase? Probably,” Dialynas said. “U.S. exporters are already courting Chinese buyers, and China is looking to diversify from Australia and Qatar, its current primary suppliers.” China is already the third-biggest importer of U.S. LNG, behind only Mexico and South Korea. In February, Cheniere Energy Inc. became the first U.S. gas exporter to sign a long-term deal with China, agreeing to supply China National Petroleum Corp. with 1.2 million metric tons a year through 2043.

Trump Administration Offers 77 Million Acres in Gulf of Mexico to Oil Industry - The Trump administration is holding the biggest offshore oil and gas lease auction in U.S. history Wednesday, offering all 77 million acres of unleased, available federal waters in the Gulf of Mexico.The sale comes as administration officials seek to rescind drilling safety rules approved after the BPDeepwater Horizon disaster, reduce royalties paid by oil companies, and expand offshore drilling into everyocean in the country."Trump is selling off our oceans and selling out coastal communities and marine life to the oil industry," said Kristen Monsell, oceans program legal director at the Center for Biological Diversity . " Whales , dolphins and Gulf seafood are already marinating in oil spills and industry wastewater. More drilling and less regulation will make the next Deepwater Horizon disaster only a matter of time."The Center for Biological Diversity last month sued the Trump administration for failing to evaluate how oilwastewater dumping in the Gulf harms wildlife . Oil companies have drilled more than 52,000 wells in the Gulf of Mexico and installed more than 7,000 platforms, many of which are inactive and still littering the Gulf. A recent New York Times investigation found dangerous conditions on Gulf platforms and taxpayers being left to cover the costs of cleanups and decommissioning of old drilling infrastructure.Whales, sea turtles and other imperiled wildlife are being harmed by offshore oil drilling and exploration. A federal study conducted as part of the settlement of a lawsuit involving the Center for Biological Diversity found more than 30 million marine mammals in the Gulf would be harmed by seismic oil and gas exploration.

US offshore industry downplays importance of 'bellwether' Gulf sale -- The Trump administration has dubbed Wednesday's Gulf of Mexico oil and natural gas lease sale as the largest in US history and Interior Secretary Ryan Zinke has called it a "bellwether" for America's offshore energy future. But on Tuesday, US offshore representatives downplayed the market and policy significance of the Gulf lease sale, known as Lease Sale 250, which will be held in New Orleans Wednesday. "Industry's views on the tracts available tomorrow do not necessarily say much, if anything, about industry's interest in [the eastern Gulf of Mexico] or Atlantic one to six years from now," said Christopher Guith, a senior vice president for policy at the US Chamber of Commerce's Global Energy Institute. "Economics will still be a major factor in tomorrow's sale," said Nicolette Nye, a spokeswoman for the National Ocean Industries Association. "While overall commodity prices have shown improvement, companies are still likely to take a conservative approach to locking up exploration capital. They may look first to purchase leases close to current producing fields in order to more efficiently use infrastructure currently in place." Wednesday's sale will offer 14,776 unleased blocks across about 77.3 million acres, the largest amount of blocks offered in at least 35 years.  Zinke said the sale would be a "bellwether" for the offshore industry as US onshore production continued to climb. But Guith said Zinke meant that the sale Wednesday would be a "status check" on how the industry views the economics of offshore blocks currently available compared to acreage available onshore.  

Offshore Drilling Companies Want Less Regulation. But Safety Problems Persist. - NYT - Faced with questions about its commitment to safety, the Interior Department sent teams to the Gulf of Mexico last week to inspect giant cranes used in offshore oil and gas operations that are a significant source of accidents.More than 50 inspectors, traveling on helicopters, conducted surprise inspections on about 40 offshore platforms and drilling rigs, said Jason Mathews, the head of offshore safety management for the Gulf of Mexico at the department’s Bureau of Safety and Environmental Enforcement.The results were still being compiled, he said, but the inspectors found serious problems, including some that were potentially life threatening. “There are still some major incidents that are occurring, and we need to figure out why,” Mr. Mathews said Friday.Interior Secretary Ryan Zinke had discussed plans for the inspection push this month after the safety bureau issued an alert to offshore oil and gas operators in the Gulf. It warned about a series of “potentially catastrophic crane and lifting incidents” that occurred late last year on platforms and drilling rigs.No one was killed or injured in those crane incidents, but lifting-related accidents are the second-largest cause of offshore fatalities, outnumbered only by fires and explosions, agency records show. The cranes are used to move workers and supplies from the Gulf up to the decks of the platforms. The Interior Department and its offshore safety bureau have been under a spotlight since the agency was ordered by President Trump to re-evaluate regulations enacted during the Obama administration in the aftermath of the Deepwater Horizon accident in 2010, which killed 11 offshore workers and created the largest marine oil spill in drilling history. Many offshore oil and gas operators, and other Gulf Coast businesses that serve them, complained that the regulatory response to the accident had been excessive.

US omnibus bill mandates sale of 10 million barrels of government-owned crude -- A proposed bill to fund the federal government through September calls for selling off an additional 10 million barrels of crude oil from the US Strategic Petroleum Reserve. Congress needs to pass the $1.3 trillion spending bill, known as the omnibus, by Friday in order to avoid a government shutdown. The bill calls for the US energy department to sell a total of 10 million barrels of crude from the SPR in fiscal years 2020 and 2021. The text of the bill was released late Wednesday. The bill also calls for lowering the threshold where the US government can drawdown crude from its emergency stocks. Under the threshold, set in the Energy Policy and Conservation Act of 1975, the Department of Energy cannot take or sell crude from the SPR "if there are fewer than 350,000,000 barrels of petroleum product stored in the reserve." The proposed bill unveiled Wednesday would lower that threshold to 340 million barrels. The proposed bill also authorizes sales of up to $350 million worth of SPR crude in fiscal 2018, a provision included in a 2015 budget bill, which allows DOE to sell up to $2 billion of SPR crude from fiscal 2017 through 2020 to modernize the SPR. Since late in the Obama administration, Congress has authorized sales to both upgrade the SPR and to offset spending for unrelated legislative initiatives. All of the SPR sales mandated by Congress are expected to drop the SPR's total volume to about 386 million barrels by 2028. 

Exxon's Gulf Cost refinery investments underpin US expansion - ExxonMobil earlier this month told analysts in New York that the company expects to add a total of 400 Mb/d of capacity to its three giant Gulf Coast refineries by 2025. Exxon plans to upgrade existing refineries in Houston (Baytown) and Baton Rouge, LA, to increase production of higher-value products and to add a new crude distillation unit to its 362-Mb/d Beaumont, TX, plant after 2020. A final investment decision on the Beaumont expansion — which reportedly would double the refinery’s throughput capacity and make it the largest refinery in the U.S. — is expected later this year and follows a $6 billion investment by Exxon to triple crude output from its Permian Basin production assets in West Texas. Today, we discuss the existing Beaumont operation, its feedstock sources, and the refined-product demand that supports the plant’s expansion.  Doubling the Beaumont refinery’s capacity by adding a new crude distillation unit to process an additional 300-400 Mb/d would make Beaumont the largest refinery in the U.S.; it would overtake the nearby Saudi Aramco-owned 635 Mb/d Motiva refinery in Port Arthur, TX (that itself underwent a $10 billion expansion in 2013 to add 325 Mb/d of capacity). The proposed Beaumont expansion would represent significant new investment in the domestic refining sector by a firm that sold its interest in two refineries in Louisiana and California to PBF Energy in 2015 and 2016, respectively. It’s yet another indication of how rapidly expanding shale production is changing the U.S. energy landscape. Less than a year ago, in June 2017, we described how refinery capacity additions in the next five years are mostly expected to be in Asia and the Middle East, where product demand is expanding rapidly (see Can’t You Hear Me Knocking). Now, growing Permian crude production and a thriving export market for refined products from the Gulf Coast have persuaded at least one major oil company to consider changing that mindset.

Exxon Mobil considers building new Gulf Coast plastics plant --- Exxon Mobil said Tuesday that it has started engineering work on a new Gulf Coast plastics plant that would substantially expand its petrochemicals production as demand increases worldwide. It would expand production of polypropylene, a lightweight, durable plastic, by as much as 450,000 tons a year. The company will make a final decision on the project later this year. It's anticipated to cost several hundred million dollars and employ more than 60 people when production starts. The announcement comes amid a petrochemicals boom throughout the Gulf Coast region as producers capitalize on a steady flow of natural gas from West Texas shale fields. The surge in production there has created a cheap supply of ethane and other natural gas liquids to be converted into feedstocks for plastics, building materials and consumer goods. The International Energy Agency anticipates that petrochemicals will account for a quarter of the growth in global oil consumption during the next five years. Major companies including LyondellBasell, Chevron Phillips Chemical and DowDupont have collectively invested billions of dollars in expanding their facilities here to meet growing demand for plastics in emerging middle-class markets in China, India and elsewhere. Exxon Mobil said its new polypropylene plant would produce advanced materials for use in automobiles, appliances and packaging. In the automotive industry, the lightweight plastics could replace certain steel components to reduce vehicle weight and improve fuel efficiency.

Even Without Trump-Brokered Deal, Refiners Get Biofuel Relief  - Despite a series of White House meetings in recent months, U.S. oil refiners haven’t seen any change in the federal mandate requiring them to blend biofuels. Yet the market in biofuel credits shows they’re getting some of what they want anyway. The complaint among some refiners is that the cost of complying with the Renewable Fuel Standard is too high. Refiners without the capability to blend ethanol or biodiesel have to buy the credits, so-called Renewable Identification Numbers, or RINs. Prices for RINs have slumped amid the Trump administration meetings, indicating that refiners are increasingly confident they’ll get some kind of relief. “The conversation has already been helpful in that area of driving RIN prices down,” U.S. Agriculture Secretary Sonny Perdue said in a speech in Washington on Tuesday. The RFS is a complicated policy that crosses political lines and reverberates in markets for corn and crude oil. Two of President Donald Trump’s most valued constituencies -- blue-collar workers and farmers in the rural Midwest -- are locked in a fight over compliance costs. The debate has gotten more heated since the recent bankruptcy of Philadelphia Energy Solutions Inc., the largest U.S. East Coast refiner. But farmers of corn and soybeans -- used to make ethanol and biodiesel -- support the RFS. Although Trump had pledged to support the program during his presidential campaign, he has personally waded into the debate, holding meetings in an attempt to broker a deal between the two sides. 

Some Oil Refineries Are Getting a License to Print Money -- The world’s most sophisticated refineries are about to enjoy great times thanks to what might seem like a minor tweak in rules for the type of fuel ships consume.From 2020, vessels must buy fuel with less sulfur, or alternatively be fitted with equipment to curb emissions of the pollutant. One thing is clear: only a tiny fraction of the merchant fleet will have such gear when the rules enter force, since many shipowners argue it’s the responsibility of refineries to sell the right fuel.That’s fantastic news for complex plants, including some of the biggest on the U.S. Gulf Coast, in Europe and in Asia. Unlike simpler refineries, they can already make marine gasoil -- a distillate fuel similar to diesel that ships are going to need -- without churning out leftover, non-compliant fuel oil, according to Alan Gelder, vice president for refining, chemicals and oil markets at Wood Mackenzie Ltd. in London.“They’ll print money,” The new sulfur standards, established by the International Maritime Organization in 2016, aim to cut the presence of a pollutant that has been blamed as a contributor to human health conditions like asthma and environmental damage like acid rain. Some shippers say that in an extreme scenario, the changes could upend world trade if the cost of compliance is too high. The existing global standard is generally 3.5 percent sulfur in fuel oil -- normally the residue when refineries make higher-value products like gasoline, diesel and jet fuel.

China slaps tariff on U.S. oil pipe, potential hit to Texas industry - Texas manufacturers who produce steel oil and gas pipelines and drill pipe are expected to see a relatively modest impact from China's announcement it was slapping a 15 percent tariff on steel pipe from the United States.  Last year the United States exported 832,000 metric tons of steel pipe, according to the U.S. International Trade Administration. More than 80 percent of that pipe went to Canada and Mexico, with China coming in a distant third. "Bottom line, if the retaliation is on pipelines, Houston will not see much impact. However, if the trade war escalates to broader energy related machinery classes, then Houston will be more exposed," said Praveen Kumar, executive director of the University of Houston's Gutierrez Energy Management Institute. The steel pipe tariff is part of a sprawling $3 billion tariff imposed by the Chinese early Friday, in response to President Donald Trump's announcement he would enact tariffs targeting $50 billion in Chinese goods. Among the U.S. goods targeted by the Chinese are pork, apples and steel pipe, but officials in Beijing are believed to be considering further action depending on the economic impact of Trump's tariffs.

Radar images show large swath of West Texas oil patch is heaving and sinking at alarming rates --Analysis indicates decades of oil production activity have destabilized localities in an area of about 4,000 square miles populated by small towns, roadways and a vast network of oil and gas pipelines and storage tanks.  That’s the finding of a geophysical team from Southern Methodist University, Dallas that previously reported the rapid rate at which the sinkholes are expanding and new ones forming.  Radar satellite images show significant movement of the ground across localities in a 4000-square-mile area — in one place as much as 40 inches over the past two-and-a-half years, say the geophysicists.“The ground movement we’re seeing is not normal. The ground doesn’t typically do this without some cause,” said geophysicist Zhong Lu, a professor in the Roy M. Huffington Department of Earth Sciences at SMU and a global expert in satellite radar imagery analysis. “These hazards represent a danger to residents, roads, railroads, levees, dams, and oil and gas pipelines, as well as potential pollution of ground water,” Lu said. “Proactive, continuous detailed monitoring from space is critical to secure the safety of people and property.”The scientists made the discovery with analysis of medium-resolution (15 feet to 65 feet) radar imagery taken between November 2014 and April 2017. The images cover portions of four oil-patch counties where there’s heavy production of hydrocarbons from the oil-rich West Texas Permian Basin. The imagery, coupled with oil-well production data from the Railroad Commission of Texas, suggests the area’s unstable ground is associated with decades of oil activity and its effect on rocks below the surface of the earth.

Large Swath of Texas Oil Patch Rapidly Sinking and Uplifting, Study Finds - West Texas is already home to two giant sinkholes near the town of Wink caused by intensive oil and gas operations. Now, according to an unprecedented study, the "Wink Sinks" might not remain the last in the region. Geophysicists at Southern Methodist University (SMU) in Dallas have found rapid rates of ground movement at various locations across a 4,000-square-mile swath around the two sinkholes. This area is known for processing extractions from the oil-rich Permian Basin . The scientists made the discovery after analyzing radar satellite imagery taken between November 2014 and April 2017. Combined with oil-well production data from the Railroad Commission of Texas, the researchers concluded that the area's sinking and uplifting ground is associated with decades of oil activity and its effect on rocks below Earth's surface.  "Based on our observations and analyses, human activities of fluid (saltwater, CO2) injection for stimulation of hydrocarbon production, salt dissolution in abandoned oil facilities, and hydrocarbon extraction each have negative impacts on the ground surface and infrastructures, including possible induced seismicity," the study , published in the journal Scientific Reports, says.  One location saw as much as 40 inches of movement over the past two-and-a-half years, the geophysical team found.   The latest findings build on the team's 2016 report that revealed the existing "Wink Sinks" are expanding and new ones are forming.

Study Finds Hormone-Disrupting Chemicals Near Fracking Wells - West Virginia Public Broadcasting - Radio piece on study and interview with author. Dozens of chemicals that can affect the fertility of humans and animals are being found in the air near unconventional oil and gas development, according to a new study. More than 200 chemicals have been found near unconventionally drilled sites, most-commonly fracked wells, according to a paper published today in the journal Environmental Health.Carol Kwiatkowski, executive director of a nonprofit called the Endocrine Disruption Exchange, said that of those chemicals, 34 are known to be endocrine disruptors, or chemicals that interfere with hormone systems in mammals.“Well-known hazardous air pollutants are being found near fracking sites and may be contributing to health outcomes that are being experienced by people living near fracking sites,” said Kwiatkowski, a co-author of the study. “The endocrine disrupting chemicals that are found at these sites may be contributing to health outcomes that won’t be realized for decades.”Researchers reviewed more than 4,000 peer-reviewed papers. In total, they found 48 air sampling studies were conducted between 2003 and 2016. Texas’ Barnett Shale formation was studied the most. The Marcellus Shale formation in the Ohio Valley, was the fourth-most-studied area.Chemicals known to cause cancer, and heavy metals such as mercury, were also found near oil and gas development. Researchers said more information is needed to know what the long-term health impacts of these chemicals are. An estimated 17.6 million Americans live near unconventional oil and gas wells.For this paper, the researchers did not do any original experiments, rather they looked only at the already-published science. The study also does not draw a direct link between hormone-disrupting chemicals and oil and gas development. Instead, it shows studies have found these chemicals are often found near oil and gas development.

Community fights massive drilling site planned near public school in low-income area -  Residents of a city along Colorado’s Front Range are fighting the construction of a major oil and gas drilling site set to be completed next year near a public school attended mostly by low-income students of color. Denver-headquartered Extraction Oil and Gas was originally awarded a permit in 2013 to drill up to 67 wells a few hundred feet away from Frontier Academy in Greeley, Colorado, a city with a population of over 100,000. The school is composed of children that come largely from white, middle-class families.  In the face of the parents’ resistance, Extraction Oil and Gas opted to abandon the Frontier Academy site, in southern Greeley. The company instead turned its attention to a different site on the eastern side of the city. In May 2016, the company filed an application with the Colorado Oil and Gas Conservation Commission (COGCC) for the project. This new location also was within a thousand feet of a school. The school, Bella Romero Academy, serves mostly working-class Latinx families. Nearly 90 percent of its children qualify for free and reduced-price lunches. In June 2016, the Weld County board of commissioners unanimously approved a special use permit that would allow Extraction Oil and Gas to build a 24-well pad project, known as the Vetting site, near the Bella Romero Academy campus. The industrial project will be located about 1,350 feet from the school building but about 500 feet from the school’s playground and ball fields. With all of its necessary permits, the company hopes to complete the project sometime in 2019. Last spring, a group of residents joined environmental groups to file a lawsuit in Denver County (Colorado) District Court against the COGCC for approving the project. “It is this stark disparity that raises concerns of environmental justice at Bella Romero Academy,” the plaintiffs stated in the lawsuit. “The commission and operators generally experience the least amount of pushback when siting major oil and gas development in predominantly minority communities since these communities do not have the same resources as more affluent communities.” 

Lafayette elementary school sees tensions over fracking - Boulder Daily Camera - Fracking tensions have seeped down to the elementary school level in Lafayette, where a meeting is set this week after a principal took steps to limit bannering activities relating to oil and gas issues. East Boulder County United, which has been vocal in opposing plans for large-scale expansion of oil and gas development across broad sections of the area along the U.S. 287 corridor, has drawn attention to the school's stance and is contesting the school's actions.The school community's interest in the subject is more than just academic. One example of the drive to dot the eastern county with hundreds of wells is theapplication by Extraction under its subsidiary 8 North for a state drilling and spacing order on a 1,280-acre area between Arapahoe and Baseline roads in the Lafayette-Erie area, which encompasses at its southwest corner the Escuela Bilingue Pioneer Elementary property. Emily Love, who is a member of the Parent-Teachers Association and has a son in the fourth grade at Pioneer, said, "My son and I are very involved in planning a lot of the bannering at the school."It is a youth-led effort. The kids come out after school and they hand out signs to friends and parents, and from 3:20 to 4 p.m. every Friday after school, they meet and they walk to Baseline (Road) and they hold up signs and they share the chants that they have made up." In recent days, however, Principal Guillermo Medina sent an email that school community members in opposition to fracking see as an effort to quash their activities. "He said that a parent emailed and said they were scared of the picketing, and he wants to keep the school neutral. He asked that the bannering happen a half step outside of school property."

Physician Groups Publish One Stop Shop for Fracking Science / Public News Service  — Physicians' groups are sounding the alarm on the health risks posed by hydraulic fracturing, and have published a compendium of scientific evidence that they say confirms the damage caused by fracking operations. Joel Minor, associate attorney with the group Earthjustice, said mounting evidence shows that Wyoming families in the Upper Green River Basin are exposed to harmful volatile organic compounds released into the air, which can lead to increased asthma attacks, heart attacks and even premature death."This compendium really puts that all in one place, and shows people who live near unconventional oil and gas wells that they are at a higher risk for a number of health impacts,” Minor said, “most likely caused by exposure to things like benzene, that are leaked into the air during the hydraulic fracturing process."More than 17 million Americans currently live within a mile of an active oil or gas well - including more than 2 million children and older adults, groups especially vulnerable to air pollution and contaminated water. Proponents of fracking say when done correctly, the process is environmentally safe, and claim any spills or leaks are essentially the same as gasoline spilled when people fill up their tanks.Minor admits that any single spill may not be significant on its own. But he warned pollution, which largely occurs when transporting chemicals and wastewater - especially near watersheds and farmlands - can be cause for concern. "I think it's important to look at all of those spills together - and think about the total volume of chemicals, and fluids, and waste products that are being spilled - and look at those cumulative impacts over time,” he said.

Criminalizing Peaceful Pipeline Protests: Are Oil Billionaires Trying to Undermine Our First Amendment Rights? – (interview & transcript) RNN interview discussing oil funding of state measures to criminalize peaceful pipeline protest as ‘eco-terrorism’.. Wyoming is the third state, along with Iowa and Ohio, to introduce such measures. Others to follow?

Drillers snap up federal leases near Utah's wilderness monuments (Reuters) - The U.S. Bureau of Land Management on Tuesday auctioned off more than 51,000 acres (21,000 hectares) in southeastern Utah for oil and gas development, a sign of strong industry demand in a region conservationists have vowed to protect. The Utah lease sale included terrain near the former boundaries of the Bears Ears National Monument, whose size was scaled back by the Trump administration last year, as well as the Hovenweep and Canyons of the Ancients monuments, according to the bureau. Results of the online auction, posted on Tuesday afternoon, showed that all 43 parcels up for sale received winning bids, which averaged $28.68 per acre and ranged between $2 and $93 per acre. Total proceeds from the auction were $1.56 million, according to the BLM. “This means drilling in these parcels poses a more serious and immediate threat to the landscape and archaeological resources,” Aaron Weiss, media director for the Center for Western Priorities, said about the apparent strong demand. The Monticello area received some of the highest bids, with Context Energy LLC bidding $145,600 for a 1,600-acre parcel, according to the BLM. Other bidders included Ayers Energy LLC, Wasatch Energy LLC and Kirkwood Oil and Gas Inc, according to the data. The auction comes as the administration of President Donald Trump seeks to boost domestic energy production by expanding federal leasing and rolling back land protections.  

Could Wastewater From Oil And Gas Production Help Solve Our Water Crisis? Not Without Better Science -  Climate change is drastically raising demands on the world’s fresh water supplies, and as a result, governments, scientists, and others are actively searching for new ways to manage and preserve our water resources.One consideration includes repurposing wastewater generated from on-shore oil and gas development, which produces a whopping 900 billion gallons of water annually in the U.S. alone. Some proponents of this option believe produced water may be a massive opportunity for water-scarce regions. Researchers at the University of Texas suggest recycling produced water for hydraulic fracturing operations could help address anticipated water shortage problems in the Permian Basin. Recycling wastewater within the oilfield is a viable option – as long as the spill and leaks, which can have significant and long-lasting negative impacts on soil and water resources, are minimized. However, uses beyond the oilfield are much riskier if we don’t answer some critical questions first.  Oil and gas wastewater contains a range of constituents including organics, inorganics, and potentially radionuclides. According to data reported to FracFocus and other current literature, there are more than 2,500 different chemicals that could be a found in this wastewater — from hydrochloric acid to ethylene glycol (antifreeze). Recent literature suggests there is still a lot we don’t know about these chemicals. For those 2,500 chemicals, we lack key toxicity data and only have standard analytical methods for less than 20% — and even those don’t always work. Produced water can be 10 times saltier than seawater or more, and testing technologies do not always perform accurately in such high salt content. Determining what is in the wastewater and whether or not it is hazardous is critical. Policy makers can’t develop effective standards for treated wastewater if they don’t know what water quality targets should be or what tools are needed for effective chemical detection.

Mandated study of Dakota Access line to miss completion goal (AP) — More time is needed to finish additional court-ordered environmental study of the Dakota Access oil pipeline due to difficulties in getting needed information from American Indian tribes fighting the project in court, according to federal officials. The delay won't impact the $3.8 billion pipeline, which has been operating since last June, moving North Dakota oil through South Dakota and Iowa to a shipping point in Illinois. But it will delay resolution of a federal lawsuit that has lingered for nearly two years. U.S. District Judge James Boasberg last summer ordered the Army Corps of Engineers to further review the pipeline's impact on tribal interests, including how a spill under the Lake Oahe reservoir on the Missouri River in the Dakotas would impact the water supply of the Standing Rock and Cheyenne River Sioux. Those tribes are leading the lawsuit that was filed in July 2016. The Corps last October told Boasberg it would finish the mandated work by April 2, but the agency late last week informed him that won't happen "as a result of difficulties in obtaining requested information from the plaintiff tribes in a timely manner." Justice Department Attorney Reuben Schifman did not provide a new date, saying it depended on cooperation from the tribes. The tribes have accused the Corps and Texas-based developer Energy Transfer Partners of not giving them a meaningful role in the process. The tribes contend they also haven't been allowed adequate input in the completion of a Lake Oahe spill response plan or in the selection of an independent engineering company to review whether the project complies with federal laws and regulations, which Boasberg also ordered.

Bakken frack sand provider expands through $15M acquisition - Texas-based Smart Sand has now acquired the rights to a unit train transloading terminal in the heart of the Bakken.Through a $15.5 million deal, Smart Sand has acquired the assets and formed a long-term lease agreement with Canadian Pacific for the terminal. By 2018, the terminal, which had been used for crude storage and shipment, will be converted to receive and distribute northern white frack sand.“Our new unit train capable terminal in Van Hook, North Dakota, allows us to continue growing our presence in the Williston Basin,” said Charles Young, CEO of Smart Sand. According to Young, operators in the Bakken are now pursuing higher-intensity finer mesh frack designs. The Oakdale facility has ramped up from 3.3 million tons to 5.5 million tons.“Working with Smart Sand to repurpose this existing rail facility into a high0-efficinecy sand terminal is well-aligned with our commercial strategy to maximize capacity and asset utilization,” said Coby Bullard, vice president of sales and marketing, merchandise, energy, chemicals and plastics for CP. The new terminal will capitalize on CP’s high-capacity corridor between the nation’s premier proppant-producing region and North Dakota’s Williston Basin. According to Smart Sand data on frack sand demand, since 2016 the amount of proppant demand per new horizontal well has been on a sharp increase. In 2016, the horizontal wells market was roughly 50 million ton of proppant. Today, the market for horizontal wells has created a proppant market that demands more than 140 million tons of sand. On a per well basis, wells in 2016 required just more than 8 million pounds of sand per well. But in Q1 2018, horizontal wells are using, on average, nearly 16 million tons of proppant per well.

Montana Pipeline Protester Avoids Jail, Must Pay Restitution (AP) — An Oregon climate change activist has avoided jail time and been ordered to pay $3,775 after he was convicted of illegally shutting down a crude oil pipeline in Montana.State District Judge Daniel Boucher (boo-SHAY) sentenced Leonard Higgins on Tuesday to a three-year deferred sentence and restitution for damages.Court clerk Rick Cook says Higgins' record will be cleared of a felony criminal mischief conviction if he doesn't violate the terms of his sentence.He faced a maximum of 10 years in prison. Higgins entered a fenced site near Big Sandy, Montana, in October 2016 and closed a valve on pipeline operated by Spectra Energy.The pipeline carries oil from Canada's tar sands region. Activists simultaneously targeted other pipelines in Washington state, North Dakota and Minnesota.

California Public Utilities Commission directs SoCalGas to maximize storage injections for summer reliability – EIA - On March 13, the California Public Utilities Commission (CPUC) issued a letter to the Southern California Gas Company (SoCalGas)—owner and operator of Southern California’s four underground storage facilities—directing them to maximize injections into their natural gas storage facilities to avoid possible future service disruptions. According to the CPUC, SoCalGas’s inventory is critically low after winter withdrawals, and storage is needed for summer reliability.As of March 18, SoCalGas reported 48 billion cubic feet (Bcf) in working gas inventory for all four of their storage facilities (64% of 75.5 Bcf of total working gas capacity). SoCalGas’s Aliso Canyon storage facility, California’s largest, has been heavily restricted since experiencing a leak from October 2015–February 2016, which reduced its working gas capacity to 24.6 Bcf from 86 Bcf. In early March, SoCalGas reported that storage at its three smaller facilities was close to 28 Bcf, or 53% of unrestricted capacity. Heating degree days in the Pacific Region since the week of February 18, 2018, have been 29% higher than normal on average for this time of year. To respond to this heightened demand, CPUC granted permission for SoCalGas to withdraw 1.1 Bcf of natural gas from Aliso Canyon in six intervals between February 19–March 6. Since reaching $19.58 per million British thermal units (MMBtu) on February 20—the highest recorded price at the SoCal Citygate—natural gas prices have remained elevated relative to the Henry Hub spot price, averaging $3.34/MMBtu. The Henry Hub spot price has averaged $2.65/MMBtu during this same period. Inventory in SoCalGas’s four storage facilities has been down significantly since a peak of 125 Bcf at the time the Aliso Canyon leak was discovered in October 2015. SoCalGas inventories had reached their lowest levels—18.5 Bcf in March 2014—prior to the leak and after a particularly cold winter. At the time, Aliso Canyon had its full storage capacity available, and CPUC did not intervene. Although storage levels last year at this time were lower (39.2 Bcf in working gas capacity) than this year, CPUC did not issue a letter of concern about last year’s levels until last July. In addition to critically low storage levels and cold weather this year, ongoing unplanned maintenance and outages on two major pipelines (Line 3000 and Line 235-2) is continuing to cause supply constraints.

Inslee questions whether Canadian pipeline should expand  (AP) — The governor of Washington says his state is "allied" with British Columbia in questioning whether the Trans Mountain pipeline should be expanded. Gov. Jay Inslee says the project poses a threat to waters off the West Coast, which Washington residents view as a treasure. He says the state is looking at marine safety laws that would help mitigate the impact of a tanker spill. Inslee is in Vancouver Friday for a meeting with British Columbia Premier John Horgan and officials from Oregon and California, which make up the Pacific Coast Collaborative. Inslee says residents in his state recently rejected proposals for both coal and oil ports. Inslee commended British Columbia for leadership on climate protection. But he says Trans Mountain may be a federal policy that "shoots Canada in the foot" and reverses some of the work done by the province. Federal Environment Minister Catherine McKenna acknowledged at an event in Victoria today that there are differences over the pipeline from Edmonton to Burnaby, British Columbia. But she says it was approved after extensive reviews and it will be built. 

28 Activists Arrested at Kinder Morgan Pipeline Construction Site - Despite a court-ordered injunction barring anyone from coming within 5 meters (approximately 16.4 feet) of two of its BC construction sites, opponents of the Kinder Morgan Trans Mountain pipeline expansion sent a clear message Saturday that they would not back down. Twenty-eight demonstrators were arrested March 17 after blocking the front gate to Kinder Morgan's tank farm in Burnaby, BC for four hours, according to a press release put out by Protect the Inlet , the group leading the protest. According to the release, the protesters were a mixed group of indigenous people, families, retired teachers and other community members. "We're going to do whatever it takes, and by any means necessary, and we'll show up day after day until we win this fight," Treaty-6-Mathias Colomb-Cree-Nation member Clayton Thomas-Muller said in the release. Saturday's action was an intentional show of civil disobedience. "Everyone was very aware of the situation, of the possibility of arrest. And everyone was given the chance at any time during the day to leave that zone and not be arrested," 

Kinder Morgan Pipeline Protest Grows: Arrests Include a Greenpeace Founder, Juno-Nominated Grandfather - Just because you get older, it doesn't mean you cannot stop taking action for what you believe in. And Monday was a case in point. Two seventy-year-olds, still putting their bodies on the line for environmental justice and indigenous rights.Early Monday morning, the first seventy-year-old, a grandfather of two, and former nominee for Canada's Juno musical award, slipped into Kinder Morgan's compound at one of its sites for the controversial Trans Mountain pipeline and scaled a tree and then erected a mid-air platform with a hammock up in the air.  Terry Christenson had taken food and water with him and said he had no intention of coming down. His non-violent direct action was in protest of Kinder Morgan's tree clearing through Burnaby Mountain for the company's highly contentious pipeline to the BC coast. It was part of a week of direct action designed to slow construction and clearing that has to be undertaken by the company before March 26, when migratory birds start flying north for the summer.  Christenson was arrested around 8 p.m. last night. He was not the only one arrested. Fifteen more people were arrested by blocking the gates to Kinder Morgan's compound. This brings the total to about fifty people arrested in the past few days, with opposition against the pipeline growing daily. Yesterday, one of the first to be arrested at the gates was another seventy-year-old, Rex Weyler, who co-founded Greenpeace International in 1979 and is one of the founders of theHollyhock retreat center in BC.  "Forty-six years ago, Greenpeace got its start right here in Vancouver protecting this coastline, and the world, from the sorts of ecological disasters and social disruption that Kinder Morgan's pipeline threatens," he said. "Like then, we stand now for protection of the natural bounty that keeps our communities alive and prosperous.

Aggressive Police Tactics Escalate Against TransMountain Pipeline Protests in Canada - Real News Network (video & transcript) In Burnaby, British Columbia, it's the fourth day of resistance in what has been dubbed the Standing Rock of the North. The target of this resistance is the proposed seven billion dollar doubling of the Trans Mountain Kinder Morgan pipeline to carry dirty tar sands oil from Alberta to the British Columbia coast to the Burrard inlet of North Vancouver. More than 60 people have now been arrested, including a former Trans Mountain environmental engineer Romilly Cavanaugh, during similar actions conducted Saturday through Tuesday. The arrests are ongoing. These actions follow the March 10th Protect the Inlet march, where thousands of people rallied against the pipeline and tanker project. Resistance is growing. In Canada a national day of action has been called for this Friday against the Kinder Morgan Trans Mountain pipeline expansion.  Now here to discuss the resistance with us is Clayton Thomas-Muller. Clayton is a member of the Treaty Six-based Mathias Colomb Cree Nation, also known as Pukatawagan, located in northern Manitoba, Canada, and based in Winnipeg Clayton is the Stop It At the Source campaigner with He joins us today from Winnipeg. Thanks very much for coming back on the Real News, Clayton.

Risky Move: Canada Shipping More Tar Sands Oil by Rail -- The Motley Fool has been advising investors on " How to Profit From the Re-Emergence of Canada's Crude-by-Rail Strategy ." But what makes transporting Canadian crude oil by rail attractive to investors?According to the Motley Fool, the reason is "… right now, there is so much excess oil being pumped out of Canada's oil sands that the pipelines simply don't have the capacity to handle it all."The International Energy Agency recently reached the same conclusion in its Oil 2018 market report ."Crude by rail exports are likely to enjoy a renaissance, growing from their current 150,000 bpd [barrels per day] to an implied 250,000 bpd on average in 2018 and to 390,000 bpd in 2019. At their peak in 2019, rail exports of crude oil could be as high as 590,000 bpd—though this calculation assumes producers do not resort to crude storage in peak months," the International Energy Agency said, as reported by the Financial Post . To put that in perspective, however, the industry was moving 1.3 million barrels per day at the peak of the U.S. oil-by-rail boom in 2014.   And Canada has plenty of capacity to load oil on more trains, which means if a producer is willing to pay the premium to move oil by rail, it can find a customer to do it. The infrastructure is in place to load approximately1.2 million barrels per day .

IEA says Canadian crude-by-rail shipments to more than double to 390,000 barrels a day - Crude-by-rail shipments could more than double over the next two years from historic highs as a lack of pipeline capacity forces producers to look to alternatives, said the International Energy Agency Monday. The Paris-based IEA forecasts in its latest oil markets report that crude-by-rail exports will grow from 150,000 barrels a day in late 2017 to 250,000 barrels a day this year and then to 390,000 barrels a day in 2019. “Crude by rail exports are likely to enjoy a renaissance,” said the IEA, as at the end of 2017 oil available for export was 310,000 barrels a day higher than the take away pipeline capacity. With oilsands production expected to keep growing, crude-by-rail shipments could peak as high as 590,000 barrels a day in 2019 if producers don’t resort to crude storage in peak months, the IEA said. The shipments are significantly higher than the current record of 179,000 barrels a day reached in September 2014 before oil prices collapsed. The increase in shipments comes after an increase in railway incidents in 2017, including a 21 per cent jump in accidents from a year earlier and the number of dangerous goods leaks increasing from two to five. The IEA says rail shipments are expected to return to around the 170,000-barrel-a-day level in 2020 assuming Enbridge Inc. replaces its Line 3 pipeline and adds capacity elsewhere on its Mainline pipeline system.

Why the big spread between WCS (Canadian) and WTI (US) crude oil will stick around. --Western Canadian Select (WCS), a heavy crude oil blend, has been selling for about $25/bbl less than West Texas Intermediate (WTI) at the Cushing, OK, hub — a hard-to-bear experience for oil sands producers that have made big investments over the past few years to ratchet up their output. And the WCS/WTI spread is unlikely to improve much any time soon. Pipeline takeaway capacity out of Alberta has not kept pace with oil sands production growth, and existing pipes are running so full that some owners have been forced to apportion access to them. Crude-by-rail (CBR) is a relief valve, but it can be costly. Worse yet, production continues to increase and the addition of new pipeline capacity is two years away — maybe more — so deep discounts for WCS are likely to stick around. Today, we discuss highlights from our new Drill Down Report on Western Canadian crude markets. It hasn’t been an easy winter in Western Canada’s oil patch, and we’re not talking about the weather. Sure, production in the oil sands continues to ramp up as new projects — large and small — come online after years of development. Output from the Western Canadian Sedimentary Basin (WCSB), which includes the Alberta oil sands, now stands at about 4.0 MMb/d, and the consensus among Canadian forecasters is that production will increase to 5.0 MMb/d by 2025.

'Kayaktivists' Board Rig Set to Drill Arctic - Peaceful "kayaktivists" from Greenpeace Norway boarded a Statoil -contracted rig set to drill two Arctic wells this year. Two people boarded the rig at the Skipavik yard on Norway's west coast Thursday morning and have requested a meeting with the rig's captain. Another 10 activists are in the water with signs that say, "Same shit, new wrapping," in reference to Statoil, Norway's biggest petroleum company, that wants to change its name to "Equinor." The protesters are there "to ensure the rig does not leave port," Truls Gulowsen, the head of Greenpeace in Norway, told Reuters . "We are prepared to stay as long as necessary," he added.  Statoil contracted the West Hercules semisubmersible rig set to drill two exploration wells in the Barents Sea this summer.  Earlier this year, Greenpeace and other groups lost a climate case against the Norwegian government for granting new oil drilling licenses in the Arctic ocean, claiming that such activity violates people's right to a healthy environment and breaches the Paris agreement .

Report says WA fracking would blow Australia's whole carbon budget -- Carbon pollution from fracking all Western Australia’s potential unconventional gas reserves would blow Australia’s entire carbon budget under the Paris Agreement three times over, new research shows.  Unconventional gas exploration in WA is focused on shale and tight rocks, only accessible through hydraulic fracturing: injecting a water-chemical mix into the ground to fracture the rocks and release the methane.  Environmental activists protest against fracking outside the WA Labor State Conference in Perth in 2017. German-based researcher Climate Analytics last week released Western Australia's Gas Gamble - Implications of natural gas extraction in WA. The report says if all WA’s conventional gas reserves were exploited carbon emissions would be 40-75 per cent above what WA’s energy sector could emit to comply with the Paris Agreement. The countries that signed the 2015 Agreement set carbon “budgets” to limit climate change to a maximum of two degrees above pre-industrial levels, a level of warming predicted to cause major droughts, food shortages and damaging sea level rises.

UK oil output seen rising 9% this year: industry group - UK oil production is expected to rise by 9% this year, to nearly 1.1 million b/d, while gas output will remain flat and the longer term looks less positive, industry group Oil & Gas UK said Tuesday.Higher oil output will be supported by 12 projects that came on stream last year, among them the BP-led revamp of the Schiehallion field, and two large projects due on stream this year: the Clair Ridge expansion project, led by BP, and the start of production from Statoil's Mariner heavy oil field, Oil & Gas UK said in its annual "Business Outlook" report. UK oil output had been expected to rise for a third year in a row last year, but instead dropped by around 1% due to the shutdown of the Forties pipeline in December, caused by a hairline crack. Also positive for the sector this year will be the expected approval of 12-16 large oil and projects, some being new field developments and others being extensions to existing assets, compared with just two approvals in each of the last two years, the report said.  With a total investment price tag of over GBP5 billion ($7.0 billion), it said these projects could yield 450 million barrels of oil equivalent, including both gas and liquids.

Groningen natural gas field production cut decision by Mar 31: minister - Dutch economy minister Eric Wiebes will send a letter to the country's Cabinet containing details of a major cut to extraction levels at the Groningen gas field by March 31 at the latest, a government representative said Friday. Last Thursday, when Wiebes visited the damage claims desk in Groningen, he told local media he would send a letter about the future of gas extraction at Groningen by the end of March. The current production quota for the 2017-18 Gas Year ending September 30 is 21.6 Bcm. Following a 3.4-magnitude earthquake in the northern Dutch province of Groningen on January 8, with reports saying the quake was related to gas extraction, Wiebes said Groningen gas production could be cut by up to 2 Bcm in the current gas year, depending on temperatures. Dutch gas regulator SodM also recommended a 12 Bcm/year cap on gas output from Groningen be introduced. However, the final decision is up to Wiebes and he was expected to announce a production cut for the current gas year by March. Dutch gas production has been falling since February, with Groningen operator NAM seeking a fairly flat output profile amid pressure from public and political debates on further output cuts. All five Loppersum areas at the giant onshore field were closed on February 2 in response to a request from Wiebes on the heels of the January 8 quake. Even with the arrival of the cold blast in Week 9 that triggered spikes in gas consumption, Dutch gas production averaged 135 million cu m/d, data from S&P Global Platts Analytics showed. 

Germany’s Pivot From Russian Gas Will Be Costly -- More problems are mounting for Russia’s oil and gas sector. This time it’s coming from Germany, which until recently usually gave Russia’s energy sector more lead way than the U.S. or other allies. But now it seems that German Chancellor Angela Merkel has also had enough. On Monday, Bloombergreported that Merkel’s government is seeking to build a liquefied natural gas (LNG) industry in Germany basically from scratch to reduce the nation’s dependence on supplies arriving by pipeline from Russia and Norway.Merkel backs “all initiatives supporting further diversification of gas supply — whether from different regions or means of transporting gas,” said German Economy and Energy Ministry spokeswoman Beate Baron. The move comes as natural gas resources from the UK and the Netherlands are depleting, and Germany is forced to rely more on Russian gas. Merkel’s newly formed coalition has a “coalition contract” that among other policies sets out energy agenda including LNG for the next four years, the Bloomberg reported added.Germany, for its part, is Europe’s largest gas consumer. In 2015, the country consumed 7.2 billion cubic feet per day (Bcf/d) of natural gas, according to U.S. Energy Information Administration (EIA) data. According to the German energy research group, AG Energiebilanzen, imports account for about 90 percent of Germany’s total natural gas supply, while most imports come from three countries: Russia (40 percent of total imports in 2015), Norway (21 percent) and the Netherlands (29 percent).Moreover, German companies are participating in Russia’s controversial Nord Stream 2 pipeline, an expansion of an existing route for gas to flow from Russia to Europe under the Baltic Sea. The U.S., Poland and others have recently condemned the pipeline as a threat to European security.

EU, Russian regulators favor blockchain efficiency in energy projects (Platts podcast & transcript) EU and Russian regulators seem happy to support blockchain, smart contracts and other digital technologies that can make existing energy sector processes cheaper and more efficient, but are more cautious about true innovations like peer-to- peer trading. S&P Global Platts editors Siobhan Hall, Rosemary Griffin and Henry Edwardes-Evans look at some of the pilot energy blockchain projects popping up in Europe and Russia, including for oil production logistics and wholesale gas and power trading, and how regulators are reacting. Platts also has its own blockchain project, which is helping to make oil stocks in the UAE’s Fujairah Oil Industry Zone more transparent.

Attack Against Nord Stream 2 Renewed with Vigor: Whose Interests Does It Meet? - Economics dictate national interests. Foreign policy is the tool used to advance it.  Gas exports to Europe present exciting opportunities but supplies from Russia are cheaper and more reliable. So the US needs to get rid of the obstacle in its way - the Nord Stream 2 (NS2) pipeline, which will carry natural gas from Russia to Germany.   Washington will do anything to achieve this cherished goal. On March 15, a bipartisan group of 39 senators led by John Barrasso (R-WY) sent a letter to the Treasury Department. They oppose NS2 and are calling on the administration to bury it. Why? They don’t want Russia to be in a position to influence Europe, which would be “detrimental,” as they put it. Their preferred tool to implement this obstructionist policy is the use of sanctions. Thirty-nine out of 100 is a number no president can ignore. Powerful pressure is being put on the administration. Even before the senators wrote their letter, Kurt Volker, the US envoy to Ukraine, had claimed that NS2 was a purely political, not commercial, project. No doubt other steps to ratchet up the pressure will follow. Their loyal friends in Europe chimed in almost simultaneously with the US lawmakers. Polish Foreign Minister Mateusz Morawiecki has proven himself to be a master at telling horror stories about the scariest things that might happen once the pipeline is up and running. On March 2, the speakers of parliament in Ukraine and Moldova signed a letter addressed to the chairs of the parliaments of the EU countries, warning about the repercussions. This is “a destabilizing factor” that will weaken Europe, they exclaim. Of course it is. Paying more for gas brought in on ships that can change course to head for a new destination if the price of gas elsewhere becomes more alluring will naturally make Europe stronger. Good reasoning! On March 11, the leaders of the parliaments of Poland, Latvia, and Lithuania signed another open letter to the parliaments of the EU states to warn them against the construction of NS2.  It’s not a commercial project, they say, it’ll make you dependent on Russia. Europe needs this commodity and Russia sells it. What makes this “not a commercial deal”? Dependence? From this perspective, any customer who makes a choice then becomes “dependent” on the vendor. Who is keeping them from getting gas from other sources? The sea lanes are all open, if they need to use them. Poland and Lithuania have already built terminals for liquefied gas. But it’s more expensive and the prices in the Asia Pacific region make that market more attractive. To woo US shale-gas exporters Europeans will have to pay more. Don’t they have the right to choose what suits them best?

US Threatens Sanctions For European Firms Participating In Russian Gas Pipeline Project - As previewed overnight, the U.S. State Department is warning European corporations that they will likely face penalties if they participate in the construction of Russia's Nord Stream 2 gas pipeline, on the grounds that "the project undermines energy security in Europe", when in reality Russia has for decades been a quasi-monopolist on European energy supplies and thus has unprecedented leverage over European politics, at least behind the scenes.  “As many people know, we oppose the Nord Stream 2 project, the US government does,” said State Department spokeswoman, Heather Nauert at a Tuesday press briefing. “We believe that the Nord Stream 2 project would undermine Europe's overall energy security and stability. It would provide Russia [with] another tool to pressure European countries, especially countries such as Ukraine.”  And speaking of Ukraine, recall that in 2014, shortly after the US State Department facilitated the presidential coup in Ukraine, Joe Biden's son Hunter joined the board of directors of Burisma, Ukraine's largest oil and gas company. Surely that was merely a coincidence. The project which began in 2015 is a joint venture between Russia's Gazprom and European partners, including German Uniper, Austria's OMV, France's Engie, Wintershall and the British-Dutch multinational Royal Dutch Shell. The pipeline is set to run from Russia to Germany under the Baltic Sea - doubling the existing pipeline's capacity of 55 cubic meters per year.  Nauert said that Washington may introduce punitive measures against participants in the pipeline project - which could be implemented using a provision in the Countering America's Adversaries Through Sanctions Act (CAATSA).

Turkey to send drill ship to contested gas field off Cyprus - A showdown over natural gas and oil deposits in the seas off Cyprus is set to intensify, with Turkey announcing it is to send a drilling ship to the region days after ExxonMobil dispatched its own survey vessels to the area. As tensions flare over the potential spoils off the divided island, the Turkish president, Recep Tayyip Erdo─čan, has declared he will not tolerate the prospect of reserves being exploited by Greek Cypriots at a time when his country is engaged in conflicts elsewhere. Last month, Turkish warships were ordered to prevent drilling operations by ENI, an Italian energy company commissioned by Cyprus’s government, in what was seen as a brazen act of brinkmanship. Turkey argues the self-proclaimed Turkish republic of Northern Cyprus should also be allowed to exploit the offshore wealth, claiming that areas designated for drilling fall under Ankara’s maritime jurisdiction or that of the Turkish Cypriots. The sabre-rattling is causing growing concern. Optimism had mounted over the east Mediterranean’s potential as a gas-producing hub after geological surveys pointed to vast reserves around Cyprus. If unlocked, the resources could reshape energy geopolitics, transforming the region economically and lessening Europe’s – and Turkey’s – dependence on Russia for gas.

Chinese diesel to be shipped to 'west' in VLCC: sources (Reuters) - In a rare shipment, a diesel cargo will be loaded into a very large crude carrier (VLCC) from a refinery at China’s Tianjin port next month before heading to Europe or West Africa. The newly-built ‘Maran Aphrodite’, which can carry about 285,000 tonnes of diesel, has been chartered by oil major Total to load from Chinese state-run giant Sinopec’s refinery in the northern port to head “west”, two people familiar with the matter said. This is the second time a VLCC will load with diesel from the Chinese refinery, one of the people said. The first cargo was shipped late last year as part of a plan by Unipec - the trading arm of Sinopec - to expand in Europe. Total and Unipec could not immediately be reached for comment. The ‘Maran Aphrodite’ could either head to West Africa or Europe depending on economics and is yet to secure a buyer for the cargo, the people said. They spoke on condition of anonymity because they were not authorized to speak with media. The vessel is currently doing sea trials at South Korea’s Okpo port, Thomson Reuters Eikon shiptracking data showed on Tuesday. Unipec, which markets most of the refinery’s diesel cargoes, will load the VLCC with 10 parts per million (ppm) sulphur, which will meet Europe’s summer specifications, the sources said. With Chinese refineries maximizing production of 10ppm sulphur diesel to meet newly introduced domestic fuel quality standards, exports of diesel are increasingly also becoming higher-grade. This could potentially mean more Chinese cargoes could be shipped to Europe, which typically has more stringent fuel standards compared with Asia, traders said. 

Azerbaijan discussing possible membership with OPEC - sources (Reuters) - The Organization of the Petroleum Exporting Countries and Azerbaijan are discussing deepening cooperation, including possible Azeri membership of OPEC, two sources familiar with the talks told Reuters on Monday. Azerbaijan, along with some other non-OPEC nations led by Russia, and OPEC are cutting oil production jointly by 1.8 million barrels per day (bpd) in an effort to stabilise oil markets and boost the price of crude. The arrangement is due to run until the end of this year. OPEC Secretary-General Mohammad Barkindo visited Baku from March 17-19, holding talks with Azeri President Ilham Aliyev on Sunday and with Energy Minister Parviz Shahbazov on Monday. “Barkindo and the energy minister discussed prospects of future cooperation between Azerbaijan and OPEC,” one of the sources said. “There are three options. First - OPEC membership, the second - to become an associate member and the third - to continue cooperation the way it is now.” OPEC’s   At a briefing on Monday in Baku, Barkindo said OPEC and Azerbaijan were thinking about how to upgrade relations beyond rebalancing the oil market. “All options, including membership, are under consideration,” the second source told Reuters. Azeri oil production stood at 806,000 bpd in February, compared to 814,600 bpd in January.

Angola's oil industry close to tipping point - A lack of enthusiasm in Angola's upstream prospects, coupled with a steady decline in oil output, means the country's boom days could be numbered unless it can stimulate activity in more deepwater projects. The new government led by President Joao Lourenco will have to take some bold and gutsy steps to reform its oil industry, on which it so heavily depends. Angola's oil production has been on the wane in the past few years, with a plethora of fields that are mature and in decline and a lack of new upstream investments and incentives. Technical and operational issues, especially at its offshore fields, as well as a lack of upstream investment have dragged output down by 250,000 b/d in the past two years. Production is expected to average 1.58 million b/d in the first four months of this year, according to S&P Global Platts estimates, down from a peak of around 1.9 million b/d in 2008. State-owned Sonangol has been holding active discussions with international oil companies in the past few months as it makes tweaks to the fiscal terms of its upstream contracts in its efforts to revive the deep offshore sector, sources active in the Angolan oil sector told S&P Global Platts. Angola remains a keen prospect for deepwater exploration for oil companies but without any new fiscal or regulatory changes investment isn't likely to increase, they added.

Russia Will Stick To The OPEC Deal - Russia will continue to comply with the OPEC oil production cut deal until the deadline set in the extension agreement last November and even into 2019 if need be, Russia’s Energy Minister Alexander Novak said. Novak added, however, that Russia is also on board with an earlier end to the deal, should its partners decide it was the best course of action to follow. In an interview with Bloomberg, the official also reiterated that the best approach to ending the deal would be a gradual withdrawal, which could begin in the second half of this year, so discussions of the exit strategy of the partners in the deal could take place at their meeting in June. For the umpteenth time, Novak said he was not bothered by the growing shale oil production in the United States, or the increasingly likely possibility that the United States would become the largest oil producer in the world, overtaking Russia. Novak’s remarks come amid growing doubts that OPEC will have the patience to see the deal through its original end in December this year. With U.S. production consistently rising and predictions that it will hit 11 million bpd before the year’s end, it must be hard for rival producers to see a growing portion of this production go into markets where they hold a significant share.

Eighteen years, five wells, output zero: Zion's long quest for oil in Israel - For John Brown, the start of an odyssey began in Clawson, Michigan, when an evangelist with a book to promote walked into his local church. It was 1981, the former marketing executive had been born again, and Jim Spillman arrived with the message that oil had to be found in Israel.Two-years later Mr Brown's first visit to the country produced, as he told it, a Damascene revelation:God gave me a scripture (I Kings 8: 41- 43), avision (Oil for Israel) and, as a Christian Zionist and New Covenant believer (Isaiah 65:1), the calling to render assistance to the Jewish people and Nation of Israel, and to aid them in the Restoration of the Land by providing the oil and gas necessary to maintain their political and economic independence (Leviticus 19:33-34; Exodus 6:6-8).The divine mission would eventually lead to the founding of a company, Zion Oil & Gas, and win over thousands of converts who, for hopes of profit and purpose, would back Mr Brown's vision with more than $168m of hard cash.Three and a half decades later the visionary has been well rewarded, and may even have succeeded: in February Zion finally announced it had struck black gold.  Yet look a little closer, and the story starts to sound more like a penny dreadful than a redemptive Old Testament tale.

The Perfect Oil Field  - Burgan Oil Field in Kuwait is not the biggest oil field in the world but it is arguably the best example of reservoir "perfection" the world has ever known.  From 1948 thru 2016 the Burgan complex has produced something in the order of 32.5G BO. Development has required a minimal number of very low maintenance wells (est. 573);  it produces little to no water except on the down structure flanks, and its production costs are by far the lowest of any oil field in the world.     Burgan Field was discovered on 23 February 1938 by the Kuwait Oil Company (KOC), formerly a partnership between Gulf Oil Corporation of the United States the Anglo-Persian Oil Company;  its discovery was based partially on a topographical high mapped on the surface with plane tables, magnetics and oil seeps.  The BG-1 discovery well  encountered over-pressured, Cretaceous age 'Wara' clastic sandstones at a depth of 3,800 feet and blew out at the rate of 4000 BOPD of 32 API oil. Eight other delineation wells were drilled in the field thru 1942, all of which found new pay zones, the most prolific being  clastic sandstones of the 'Burgan' formation containing 35% porosities and permeability of over 4000 millidarcies. For you shaley minded folks that is an oil reservoir that one could almost drive a pickup thru. Wells producing today in Burgan Field still flow, 70 years  after discovery.  Information about Burgan is scarce; some pressure maintenance may currently be underway. The reservoir is "managed" by limiting withdrawal rates and monitoring oil/water contacts. Burgan produced  1.29 million BOPD in 2015. KOC says the optimum production rate that can be achieved without harm to the reservoir is something in the order of 1.5-1.7 million BOPD. In 1991, following the end of the Persian Gulf War, 511 of Burgan's oil wells, including 113 in the Magwa sector, were blown completely up or damaged  by Suddam Hussein and a retreating Iraqi army. An estimated 1.4G BO was lost during the seven month campaign to regain control of those wells. Numerous wells in the Burgan complex, particularly in the Amhadi sector, were thought to be blowing at the rate of 100,000 BOPD or more up 3 1/2 in. OD production tubing. In spite of this enormous amount of uncontrolled blowout flow, no measurable drop in bottom hole pressure occurred in any of the six producing reservoirs.

Our Latest Oil Predicament  - Gail Tverberg -  It is impossible to tell the whole oil story, but perhaps I can offer a few insights regarding where we are today.

  • [1] We already seem to be back to the falling oil prices and refilling storage tanks scenario. US crude oil stocks hit their low point on January 19, 2018 and have started to rise again. The amount of crude oil fill has averaged about 365,000 barrels per day since then. At the same time, prices of both Brent and WTI oil have fallen from their high points.  Many people believe that the oil problem, when it hits, will be running out of oil. People with such a belief interpret a glut of oil to mean that we are still very far from any limit.
  • [2] An alternative story to running out of oil is that the economy is a self-organized system, operating under the laws of physics. With this story, too little demand for oil is as likely an outcome as a shortage of oil. Oil and energy products are used to create everything, even jobs. If all humans have is energy from the sun, plus the energy that all animals have, then humans would be much more like chimpanzees. All humans would be able to do is gather plant food and catch a few easy-to-catch animals (earthworms and crickets, for example). They certainly could not extract oil or find uses for it. It takes a self-organized economy to support the extraction and sale of energy products.
  • [3] It is possible that a recent rapid increase in oil supply is contributing to the current mismatch between supply and demand.  Data of the US Energy Information Administration indicates that US oil supply has recently begun to surge. It is not just crude oil production that is higher. Natural gas liquid production is higher as well. As a result, Total Liquids production is reported to have been more than 16 million barrels per day in November 2017.
  • [4] The percentage of US residents who can afford to buy a new automobile or light truck seems to be falling over time.  If we look at the number of autos and trucks sold in the US, per 1000 population, we see a pattern of falling humps, as a smaller and smaller share of the population can afford a new car or light truck, each year. The big drops occur during the gray recessionary periods marked on the chart.
  • [5] There was a steep rise in the cost of auto ownership in the 1995- 2008 period. This has since fallen back, but the cost is still high relative to the wages of many workers. One estimate of the cost of auto ownership is the reimbursement rate that the US government allows businesses to pay workers who use their own cars for company business.  Auto reimbursement rates as compiled on this list. Amounts shown on “As Stated” basis, and also at the 2017 cost level, based on CPI Urban.
  • [6] Building homes also requires oil. There has been a sharp drop in US home building, both on an absolute basis, and on a per capita basis, since 2008.
  • [7] There is no longer an oil price at which both oil exporters and oil importers are satisfied. Oil prices today are too low for oil exporters.
  • [8] If we analyze vehicle purchases by country, we can see that low oil prices since 2014 seem to be helping major oil importers but are hurting Tier 2 countries that are commodity-dependent.
  • [11] Conclusion. My expectation is that the general direction of oil prices is likely downward, especially if interest rates rise. A major financial disruption of any kind would have a similar effect. Gluts of oil can be expected with lower prices.

Funds trim bullish oil positions, but no rush for exit: Kemp (Reuters) - Hedge funds continue to turn more cautious on the outlook for oil prices, but the liquidation of former bullish positions is very gradual, suggesting most see price risks close to balance.Hedge funds and other money managers cut their net long position in the six most important futures and options contracts linked to petroleum prices by 23 million barrels in the week to March 13.Funds have trimmed their net long position in six of the last seven weeks by a total of 268 million barrels, according to position records published by regulators and exchanges.But managers still hold a net long position across the petroleum complex that is 906 million barrels higher than at the end of June 2017 ( entire adjustment has come from the bullish side of the market, with long positions cut by 277 million barrels since Jan. 23. Bearish short positions have actually declined by 10 million barrels in the same period.Long positions in Brent, NYMEX and ICE WTI, U.S. gasoline, U.S. heating oil and European gasoil total 1,347 million barrels compared with just 131 million barrels of short positions.As a result, long positions outnumber short ones by a ratio of more than 10:1, not far below the record ratio of 12:1 set almost two months ago.The liquidation of bullish positions shows no sign of accelerating. There are no signs of significant fresh short selling. And the hedge fund positioning remains exceptionally lopsided.Fund managers have become slightly more cautious about the prospect of a further increase in oil prices following the strong rally between June and January, but few are willing to bet prices will drop back much.The fund community still expects oil prices to rise further, but it has inevitably and logically become slightly less bullish given prices have risen by more than $20 (almost 50 percent) already. Fund positioning in the oil market continues to look stretched and remains a source of considerable downside price risk if and when portfolio managers try to realise more of their profits.

Oil dips as Wall Street dives; tensions over Iran support crude (Reuters) - Oil prices slipped on Monday as Wall Street slid more than 1 percent and energy market investors remained wary of growing crude supply, although tensions between Saudi Arabia and Iran gave prices some support. Brent crude futures LCOc1 dropped 16 cents, or 0.2 percent, to settle at $66.05 a barrel. U.S. West Texas Intermediate (WTI) futures CLc1 fell 28 cents, or 0.5 percent, to end at $62.06 a barrel. “The equity markets are certainly a driving factor behind this slide today,” said Brian LaRose, technical analyst at United-ICAP in Jersey City. “Since the open, they have been hit pretty hard,” he said. Wall Street’s main indexes fell more than 1.5 percent as investors worried about a potential trade war and as Facebook shares dragged down the tech sector. Oil prices have been increasingly moving in tandem with equities. Strong demand, however, prevented oil from sliding further, said Phil Flynn, analyst at Price Futures Group in Chicago. “We keep talking about all this shale oil production, but it’s not really showing up that much in global inventories; they continue to be tight,” Flynn said. Still, last week’s rise in the U.S. rig count remains a potential headwind for oil bulls. U.S. drillers added four oil rigs last week, bringing the total count to 800, Baker Hughes said on Friday. “At the current oil price level, drilling activity – and thus output – in the U.S. is likely to increase further,” analysts at Commerzbank said in a note. 

Oil prices rise on Middle East tension, but soaring U.S. output caps gains (Reuters) - Oil prices edged up on Tuesday, lifted by tensions in the Middle East, although rising output in the United States and shaky stock markets put a lid on further gains. U.S. West Texas Intermediate (WTI) crude futures were at $62.31 a barrel at 0128 GMT, up 25 cents, or 0.4 percent, from their previous close. Brent crude futures were at $66.26 per barrel, up 21 cents, or 0.3 percent. Traders pointed to concerns in the Middle East, where the United States may reimpose sanctions on Iran, as well as tensions between Saudi Arabia and Iran. Worries about Venezuela’s tumbling crude production also supported oil markets. The International Energy Agency said last week that Venezuela, where an economic crisis has cut oil production by almost half since early 2005 to well below 2 million bpd, was “clearly vulnerable to an accelerated decline”, and that such a disruption could tip global markets into deficit. Falls on global share markets helped cap gains. Markets are under pressure from concerns over a possible trade war between the United States and other major economies, as well as from fears of stiffer regulation as Facebook came under fire following reports it allowed improper access to user data. Also looming over oil markets has been surging U.S. crude oil production, which has risen by more than a fifth since mid-2016, to 10.38 million barrels per day (bpd), pushing it past top exporter Saudi Arabia. Only Russia produces more, at around 11 million bpd, although U.S. output is expected to overtake Russia’s later this year as well. Soaring U.S. output, as well as rising output in Canada and Brazil, is undermining efforts by the Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) to curb supplies and bolster prices.

WTI/RBOB Extend Gains After Surprise Crude Inventory Draw -  WTI/RBOB prices spiked today on OPEC chatter about how well they are doing, and extended those gains after API data showed a surprise crude draw (3.25mm build expected) and bond gasoline and distillates saw draws. API

  • Crude -2.739mm (+3.25mm exp)
  • Cushing +1.644mm (-200k exp)
  • Gasoline -1.063mm
  • Distillates -1.926mm

After 6 of the last 7 weeks showing builds, crude inventories fell notably on the week “The bottom line is, with oil at these prices, it’s hard to slow down the shale in the U.S.,” said Michael Corcelli, chief investment officer of hedge fund Alexander Alternative Capital in Miami. Activity in the oil patch is “out of control and you can see it in the output that we’re actually generating.” The reaction was a swift rebound to the day's earlier highs...

Oil prices rise on Middle East tensions, healthy demand (Reuters) - Oil prices rose on Wednesday, supported by tensions in the Middle East and healthy global demand, although rising U.S. output from the United States continued to weigh on markets. U.S. West Texas Intermediate (WTI) crude futures were at $63.82 a barrel at 0027 GMT, up 28 cents, or 0.4 percent, from their previous close. Brent crude futures were at $67.66 per barrel, up 24 cents, or 0.4 percent. Saudi Arabia’s Crown Prince Mohammed bin Salman arrived in to Washington for a state visit, raising market speculation the United States could reimpose sanctions on Iran, following rewnewed criticism of the 2015 nuclear deal. “The presence of the Saudi Crown Prince MBS in Washington and his clear agenda to ramp up pressure on Iran, has for me, been the key driver... of oil, which rose strongly,” said Greg McKenna, chief market strategist at futures brokerage AxiTrader. Energy consultancy FGE said it was likely that the United States would reimpose sanctions on Iran soon, resulting in a 250,000 to 500,000 barrels per day (bpd) drop in its exports by year-end. Analysts also pointed to healthy economic growth and a weak dollar as oil price drivers.   In a sign of healthy demand, U.S. crude stocks fell by 2.7 million barrels in the week ended March 16 to 425.3 million, as refineries boosted output, the American Petroleum Institute said on Tuesday.  “The global economy is humming, and robust demand solidly underpins commodity prices. The soft dollar and a bullish market mood have been equally supportive elements,” said Norbert Ruecker, head of macro and commodity Research at Swiss bank Julius Baer.  A weaker greenback makes imports of dollar-denominated crude cheaper for countries using other currencies at home, potentially spurring demand.

WTI/RBOB Extend Gains After 'Surprise' Crude Draw; Production New Record High - WTI/RBOB extended yesterday's gains this morning, after bullish API data, and continued higher after DOE data confirmed the surprise crude build and decent sized product draws. Production rose to a new record high. A “tidal wave” of bullish news - including falling oil stockpiles following winter and after seasonal refinery maintenance, possible U.S. sanctions on Iran and Venezuela, as well as sustained OPEC-led output curbs - is seen hitting the market in the not-so-distant future, Bloomberg reports that FGE said in a note. Bloomberg Intelligence Energy Analyst Fernando Valle noted that domestic demand for refined petroleum products has been well above expectations for 2018, confounding fears of macroeconomic headwinds. Inventories should continue to decline, supporting higher crack spreads ahead of the peak summer season. DOE:

  • Crude -2.62mm (+3.25mm exp)
  • Cushing +905k (-200k exp) - biggest build since Oct 2017
  • Gasoline -1.69mm (-2.5mm exp)
  • Distillates -2.02mm (-2.3mm exp)

Cushing stocks rose 905k barrels - the biggest weekly rise since Oct 17 but crude's surprise build (confirming API) and product draws were seen as bullish...

Oil prices end near 7-week high on surprise declines in U.S. crude supplies - Oil futures climbed Wednesday to end at their highest level in nearly seven weeks, as a surprise weekly decline in U.S. crude inventories added further support to prices, which had already been bolstered by renewed geopolitical risk to global output. Prices had posted a sharp return a day earlier as Saudi Crown Prince Mohammed bin Salman’s meeting with President Donald Trump in Washington raised the specter of a harder U.S. line against Iran and amid continuing concerns over declines in Venezuelan production.  May West Texas Intermediate crude jumped $1.63, or 2.6%, to settle at $65.17 a barrel on the New York Mercantile Exchange. May Brent crude LCOK8, -0.50% gained $2.05, or 3%, to $69.47 a barrel on ICE Futures Europe.The settlements for both WTI and Brent were the highest since early February. Further losses for a benchmark U.S. dollar index also helped oil prices, which are traded in the greenback, finish near session highs after the U.S. Federal Reserve lifted a key U.S. interest rate, as expected.The U.S. Energy Information Administration reported Wednesday that crude supplies fell by 2.6 million barrels for the week ended March 16. Analysts surveyed by S&P Global Platts had forecast a climb of 2.6 million barrels, while the American Petroleum Institute on Tuesday reported a decline of 2.7 million barrels.

Crude oil futures ease back on bullish US stocks reports -- Crude oil futures were lower in European morning trading Thursday, easing back as the market digested the surprisingly bullish US stocks reports this week. At 1220 GMT, ICE May Brent crude futures were at $68.89/b, down 56 cents from Wednesday's settle, while the NYMEX April light sweet crude contract was down 40 cents at $64.77/b. The US Energy Information Administration Wednesday reported crude stockpiles had fallen 2.622 million barrels to 428.306 million barrels in the week ended March 16. The news was in line with the American Petroleum Institute's stocks report late Tuesday, surprising analysts who had largely been expecting a build. In a widely expected move, the US Federal Reserve Wednesday announced a hike in its benchmark interest rate by 25 basis points to 1.75%. "This contributed to the 5% build we've seen in price over the past few days of trading," Eugen Weinberg, head of commodities research at Commerzbank, said. A weaker US dollar was also underpinning prices, analysts said. The weakened dollar made it less expensive for holders of other currencies to import dollar-denominated crude. "The move had been already baked into the dollar and the currency actually weakened amid anxiety over the fallout of imminent US import tariffs against China," said Vandana Hari of Vanda Insights. Crude oil prices also found some support as market participants expect a further production constraint by OPEC as it reassesses its inventory target by considering shifting from a five-year stock average to a seven-year average, meaning cuts will be maintained for a longer period of time. 

Oil retreats from a 7-week high as trade war risks weigh on stock market - Oil prices retreated from a seven-week high Thursday, pressured by gains in U.S. production, as the risk of a global trade war weighed on the stock market. May West Texas Intermediate crude fell 87 cents, or 1.3%, to settle at $64.30 a barrel on the New York Mercantile Exchange—giving back roughly half of the 2.6% rise seen a day earlier. May Brent crude shed 56 cents, or 0.8%, to $68.91 a barrel on ICE Futures Europe. Prices for WTI and Brent had both finished Wednesday at their highest levels since early February. President Donald Trump announced tariffs Thursday on several billions of dollars of goods from China, sparking concerns over an increased risk for a global trade war. “Tariff fears that caused a selloff in the stock market caused some profit-taking” in oil after the commodity’s run-up in the wake of the surprise decline in U.S. crude stocks reported by the Energy Information Administration on Wednesday, said Phil Flynn, senior market analyst at Price Futures Group. Crude inventories fell 2.6 million barrels in the week ended March 16 according to data published by the U.S. Energy Information Administration on Wednesday.  “With an oil market that already had upward momentum from rising Saudi/Iran tensions and a negative outlook for Venezuela production, the bullish inventory data provided a spark that sent oil to multiweek highs,” Wednesday, said Tyler Richey, co-editor for the Sevens Report. But the EIA also reported that U.S. production edged up by 26,000 barrels a day to 10.407 million barrels a day—a fresh weekly record.

Oil Rebounds Despite Trade War Fears -- Oil prices fell sharply on Thursday on news of $60 billion worth of tariffs on China. China followed up on Friday with an initial announcement of $3 billion worth of tariffs on U.S. pork, fruit and recycled aluminum and steel pipes. Wall Street fell sharply over fears of a brewing trade war. That dragged down oil prices, although benchmark prices rebounded in early trading on Friday.   Oil prices rose by 1 percent on Friday morning after Saudi Arabia said that the OPEC production curbs could be extended into 2019. "We still have some time to go before we bring inventories down to the level we consider normal," Saudi oil minister Khalid al-Falih told Reuters. "We will hopefully by year-end identify the mechanism by which we will work in 2019."  President Trump tapped former U.S. Ambassador to the UN, John Bolton to replace H.R. McMaster as National Security Adviser. The reshuffling is widely seen as a major shift towards a hawkish foreign policy, raising the odds of conflict with Iran and North Korea, in particular. As the year wears on, U.S. confrontation with those two countries could be incredibly bullish for oil.   The Trump administration announced plans for a variety of tariffs targeting an estimated $60 billion worth of Chinese goods. The move was met with a stock market selloff, which also dragged down crude oil. The risk of a trade war is rising sharply, as China has vowed retaliation. The IMF, along with a long line of economists, governments and business groups, have warned that protectionism poses a grave risk to the global economy. Meanwhile, the Trump administration exempted a series of parties from the previously announced steel and aluminum tariffs, including the EU, Argentina, Australia, Brazil, South Korea, Mexico and Canada.

Texas adds 7 rigs as US rig count increases to 995 - The number of rigs exploring for oil and natural gas in the U.S. increased by five this week to 995.That exceeds the 809 rigs that were active this time a year ago.Houston oilfield services company Baker Hughes reported Friday that 804 rigs drilled for oil this week and 190 for gas. One was listed as miscellaneous. Among major oil- and gas-producing states, Texas increased by seven rigs and Alaska and Colorado each gained two. A group of engineers from the 2018 Ford Mustang team did a little after-hours work to develop some new go-fast equipment that turned out so good, they convinced management to put it on sale.Oklahoma lost four rigs, Utah decreased by two and Ohio lost one.Arkansas, California, Louisiana, New Mexico, North Dakota, Pennsylvania, West Virginia and Wyoming were unchanged. The U.S. rig count peaked at 4,530 in 1981. It bottomed out in May of 2016 at 404.

US Rig Count Continues To Rise As Canadian Rig Count Plunges - Baker Hughes reported another 5-rig increase to the number of oil and gas rigs this week. The total number of oil and gas rigs now stands at 995, which is an addition of 186 rigs year over year. The number of oil rigs in the United States increased by 4 this week, for a total of 804 active oil wells in the U.S.—a figure that is 152 more rigs than this time last year. The number of gas rigs rose by 1 this week, and now stands at 190; 35 rigs above this week last year.  The oil and gas rig count in the United States has increased by 71 in 2018.Canada continued its severe losing streak, with a decrease of 58 oil and gas rigs, after losing 54 rigs on top last week, and a 29-rig loss the week before. At 161 total rigs, Canada now has 84 fewer rigs than it did a year ago.  Oil prices managed to climb substantially this week and were up again today prior to data release as the Saudi Energy Minister, Khalid al-Falih, said that he expected the production cuts to last into 2019. Other factors buoying prices are tensions in the Middle East after Saudi Arabia insisted that it would pursue nuclear power plans with or without the support of the United States, and would even work on developing nuclear weapons should Iran do the same. Weighing on prices this week is U.S. crude oil production, which continued its uptick in the week ending March 16, reaching 10.407 million bpd. At 12:28 pm EST, the price of a WTI barrel was trading up $1.11 (+1.73%) to $65.41—a ~$4.00 increase over last week’s prices. The Brent barrel was also trading up on the day, by $0.93 (+1.36%) at $69.31 $65.78. Meanwhile, WCS was trading at $35.80. At 1:09pm EST, WTI was trading at $65.39 (+$1.09) and Brent was trading at $69.31 (+$0.93).

Crude Oil Prices Settle at 8-Week Highs on Prospect of Further Output Cuts -- WTI crude oil prices settled at eight-week highs as the prospect of an extension to OPEC-led production cuts into 2019 overshadowed data showing the number of U.S. oil rigs rose to a three-year year.On the New York Mercantile Exchange crude futures for May delivery rose 2.46% to settle at $65.88 a barrel, while on London's Intercontinental Exchange, Brent rose 2.22% to trade at $70.44 a barrel.The number of oil rigs operating in the US rose by four to 804, the highest level since March 27, 2015, according to data from energy services firm Baker Hughes.Yet upbeat comments from Saudi Energy Minister Khalid al-Falih stoked demand for crude after he said OPEC members would need to work with Russia and other non-OPEC oil-producing countries on production cuts into 2019 to reduce global oil inventories . That comes as Goldman Sachs earlier this week upped its forecast for Brent prices, citing strong emerging market demand and OPEC likely overshooting their inventory rebalancing targets.“Given continued robust demand growth, particularly in emerging markets and, in our view, OPEC likely to overshoot on the inventory rebalancing, we see spot Brent reaching $82.50 per barrel by mid-year, Goldman Sachs said”OPEC and Russia agreed in November to extend the 1.8 million barrels per day output cuts through 2018, to rid the market of excess supplies.  The 5.5% rally in crude oil prices this week comes despite data showing U.S. output rose to a record of 10.4 million barrels per day last week. Offsetting that, however, was an unexpected draw in U.S. crude oil supplies.

OPEC to Discuss Changing Measure of Success for Supply Cuts -- OPEC and its allies held further discussions about changing the way they measure the impact of their production cuts, including proposals that would affect how quickly they hit their target, according to delegates from the group.One option that OPEC and non-OPEC delegates discussed in Vienna on Monday is to continue measuring commercial oil inventories in developed economies against the five-year average, but without counting years of high stockpiles, the delegates said. Another option is to use a seven-year inventory average, they said. This would move their goal of reducing stockpiles to normal levels further from reach, potentially requiring a longer period of cuts to achieve it. Delegates also considered a period of more than seven years.While the people said no final decision has been taken and the ultimate choice rests with ministers -- who didn’t attend the Vienna meeting -- the talks underscore the lingering uncertainty as the producers’ agreement enters a second year. They are going beyond their pledged cuts and crude has rallied above $60 a barrel, but there are signs that Saudi Arabia would like to go further.When the Organization of Petroleum Exporting Countries, Russia and their allies struck a deal in 2016 to end the price slump and re-balance an oversupplied market, they set a target of bringing oil inventories held by members of the Organization of Economic Cooperation and Development back in line with the five-year average. After more than a year of supply curbs, they’ve made significant progress.

Aramco Scales Back IPO Plan, Eyes Saudi-Only Listing - Saudi Arabia is scaling back its ambitions for a public offering for oil giant Aramco, moving ahead with a listing next year solely on the Saudi stock exchange while taking more time to decide if an international venue is worth it, government officials and others close to the process say. The decision has come in part because of concerns about legal risks and also because the need for a bigger listing has been negated by rising oil prices. Aramco’s listing was expected to raise as much as $100 billion on an international arena like New York—a move that also got the support of President Donald Trump, who publicly called for Aramco to list in the U.S. Crown Prince Mohammed bin Salman, who runs the day-to-day affairs of the oil-rich kingdom has become resigned to the idea that the legal risks of a U.S. listing could be insurmountable, said Saudi officials and people close to the process.  Saudi officials added that an international IPO for Aramco has become much more complicated than they initially believed. Oil prices, around $65 a barrel, have shored up the kingdom’s budget and bought them more time to determine whether an international offering remains a good idea. Prince Mohammed first floated the idea of an IPO in early 2016, when oil prices had fallen below $30 a barrel. A listing on the Tadawul, as the Saudi bourse is called, gives the government a chance to follow through on Prince Mohammed’s promise to publicly list the company without the litigation and disclosure risks that are likely to crop up on larger exchanges such as New York, London or Hong Kong. In recent weeks, Saudi officials have publicly made a nationalist case for a Tadawul listing, saying it would boost the local market and allow regular Saudis to have a stake in the nation’s crown jewel. 

Saudi Prince’s Nuclear Bomb Comment May Scuttle Reactor Deal - Opposition to a deal for the U.S. to provide nuclear power technology to Saudi Arabia is growing after Crown Prince Mohammed Bin Salman said the kingdom would develop a nuclear weapon if Iran did. The potential for U.S. companies to participate in the construction of as many as 16 nuclear reactors sought by the kingdom has been seen as a potential lifeline to Westinghouse Electric Co. and others suffering from the flagging nuclear industry at home.  To further that effort, the Trump administration is said to be considering allowing the Saudis the right to enrich uranium, a break from the so-called "gold standard" included in the nuclear-sharing agreement with the United Arab Emirates, which allows power generation but prohibits the enrichment and reprocessing of uranium. But that idea ran into a buzzsaw during a House hearing on Wednesday, with lawmakers from both parties saying prince’s admission that his country might seek to build nuclear weapons was cause to halt negotiations between the two nations.

Caught On Video: Houthi Rebels Shoot Down Another Saudi F-15 Fighter Over Yemen - On March 21, the Houthi insurgency in Yemen, also known as the Houthi rebellion, reportedly shot down a Saudi Arabian McDonnell Douglas F-15 Eagle, in the northwestern region of war-torn Yemen, cited Sputnik. A source within the Yemeni air defenses told Saba News Agency that Houthi rebels launched a surface-to-air missile (SAM), and “managed to hit an F-15 aircraft belonging to the aggression [Saudi Arabia], carrying out criminal and hostile raids over the city of Saada.”The source confirmed to Saba that Houthi rebels carried out “monitoring and targeting of the aircraft [F-15] with the latest defense technology developed locally successfully.”This alleged footage had surfaced on social media of the moment when Houthi rebels launched a surface-to-air missile (SAM) — striking the F-15 fighter jet, which caused the warplane to erupt in flames at high altitudes.FOOTAGE: #Yemen|i army & resistance shoots down a #Saudi F-15 over Sa’dah governorate by SAM. (21 march 2018)— 24 Resistance Axis (@Syria_Hezb_Iran) March 21, 2018 #Yemen#Houthi rebels have damaged a Saudi F-15 warplane near Sa'da.— Mr. Revinsky (@MrKyruer) March 21, 2018  Meanwhile, the spokesman of the Saudi Arabian-led coalition forces, Colonel Turki al-Maliki said the warplane was struck at 15:48 local time (1248 GMT) by a surface-to-air missile (SAM) launched from Saada airport camp in Yemen. Al-Maliki noted that the plane received minimal damage from the strike and managed to return to a Saudi Arabian airbase.  Al-Maliki stressed that the surface-to-air missile (SAM) was “not included in the Yemeni government arms arsenal…and that this is another proof of Iranian weapons smuggling to the Shiite rebels in Yemen.”

Tillerson’s Departure Will Embolden Saudi Adventurism -- Last week, when US President Donald Trump announced he was firing secretary of state Rex Tillerson, he cited the former’s wish to stay on course with the “terrible” Iranian nuclear deal as the main reason. Abbas Araghchi, Iran’s deputy foreign minister, said in comments publicised by an Iranian state news agency that the change showed that Washington was set on quitting the nuclear deal between Tehran and the world powers.According to Araghchi, “the United States is determined to leave the nuclear deal, and changes at the State Department were made with that goal in mind – or at least it was one of the reasons.”As such, from the Iranian point of view, things seem very clear: the US exit will kill the pact between Iran, Germany and the five permanent members of the United Nations Security Council. And as Araghchi added, “If the US quits the nuclear deal, we will also quit it, we have told the Europeans that if they can’t keep the US in the deal, Iran will also leave it.” Therefore, things do not look very bright for the 2015 Iran deal.  Despite Tillerson’s determination to stick with the deal, Trump has incessantly slammed the door on any negotiations with Iran, dismissing the fact that the Iranian authorities had accepted to freeze the nuclear programme in return for relief from international sanctions. But as it happens, what Trump calls “the rolling back of a disastrous deal” also has consequences for the Arab world and the Middle East in general. It is a general view in Qatar, for example, that more than Israel or any other lobby in Washington, the Saudis and Emiratis are behind the firing of Tillerson. Some believe that the reason for this is simply the tweet of Abdul Khaliq Abdullah, a political analyst who is close to the ruling family in the UAE, saying that Tillerson was “the worst secretary of state ever.” Others point to the leaked emails showing the UAE-backed efforts to get Tillerson out of the Trump administration because of his support for Qatar.

Trump Asked Saudi King For $4 Billion So US Troops Can Leave Syria - The Washington Post has revealed that President Trump attempted to extricate US troops from Syria by asking ally Saudi Arabia to foot the bill for postwar reconstruction and "stabilization" projects in the area of northeast Syria currently occupied by US coalition forces, to the tune of $4 billion. The deal would involve US allies like Saudi Arabia moving into a lead position regarding coalition policy in Syria, while hastening a US exit.Though the coalition continues to claim that its occupation of Syrian soil is toward anti-terror and humanitarian efforts, including the reestablishment of civilian infrastructure in a region previously controlled by ISIS, America's top general, CENTCOM chief Gen. Joseph Votel, admitted in congressional testimony this week that the Syrian government along with its Russian and Iranian allies have effectively won the war. General Votel's very frank admissions on Syria stunned hawks like Senator Graham, who were looking for more muscular policy goals. However, US policy does remain fundamentally aimed at preventing Assad and his allies from reasserting control over oil and resource rich northeast Syria, and this is where Trump reportedly envisions the Saudis as having a greater role to play, taking the pressure off US forces.According to the Washington Post the deal was articulated by Trump directly to Saudi Arabia's King Salman in a December phone call. The Post reports:In a December phone call with Saudi Arabia’s King Salman, President Trump had an idea he thought could hasten a U.S. exit from Syria: Ask the king for $4 billion. By the end of the call, according to U.S. officials, the president believed he had a deal.The White House wants money from the kingdom and other nations to help rebuild and stabilize the parts of Syria that the U.S. military and its local allies have liberated from the Islamic State. The postwar goal is to prevent Syrian President Bashar al-Assad and his Russian and Iranian partners from claiming the areas, or the Islamic State from regrouping, while U.S. forces finish mopping up the militants.

Turkish Army Seizes US Weapons Left By YPG "Terrorists" In Afrin - There are many reasons why US interventions abroad tend to backfire spectacularly and usually without fail, but the most embarrassing of all is when US weapons meant for one side end up in the hands of their enemies, and eventually used against the US itself. Most recently, this happened in the 2014-2016 period when ISIS steamrolled countless Iraqi towns, collecting Humvees, SAM missiles, guns and ammo in the process. Today, it happened again in the Syrian-Kurdish town of Afrin, where the "victorious" Turkish army seized an unknown number of weapons provided by the Pentagon to the (formerly) US-allied Kurdish YPG "terrorists" as they are called by Turkey. One day after the Turkish president declared victory in the Turkish campaign against the Kurdish outpost, on Monday Erdogan said that the Turkish army and FSA units entered Afrin and established full control over the settlement. And while he failed to thank the US taxpayers for providing him with brand new, barely used, ultramodern weapons, initially meant for the YPG which less than bravely scattered as soon as the Turkish army approached, the delighted Turkish Deputy PM revealed Turkey's plans concerning the ongoing Syria offensive, saying that the country's forces would not remain in Afrin, instead leaving the city to its "real owners."

Erdogan Declares Victory As Turkish Flag Flies Over Afrin; Reports Of Ethnic Cleansing - After a bloody, two month cross-border campaign of Turkish forces to dislodge Kurdish YPG "terrorists" from the Syrian city of Afrin, President Recep Tayyip Erdogan declared complete victory on Sunday as Turkish and allied FSA flags have been raised for the first time over Afrin's city center. Kurdish YPG forces (or "People's Protection Units") were widely reported to have withdrawn before pro-Turkish forces entered the city before dawn on Sunday, allowing invading forces to secure the city while facing no resistance. In a televised speech Erdogan claimed to have "saved" the city through the "heroic" actions of his military while also framing the operation which took place entirely on Syrian soil as humanitarian in nature. He said, "This operation has shown the whole world that Turkey sides with the oppressed," as reported by Rudaw. Kurdish authorities of Afrin canton, for the their part, condemned Russia for allowing Turkey to use airspace to dislodge Kurdish protection units. At a Kurdish press conference, an Afrin canton official leveled the charge that "Russia actively participated in opening airspace for Turkey to 'exterminate our people with all kinds of weapons and sacrificed our people for their interests in Syria, and under international silence, of the coalition, and EU'". The spokesperson added that, "We decided to remove civilians from the city to avoid a more terrible humanitarian catastrophe."

After my recent trip to Syria, I knew Afrin’s fall was inevitable – now we must concern ourselves with the next phase of war - The fall of Afrin city to the Turkish army and Syrian rebel forces was inevitable, but the situation remains full of dangers. A central question now is whether or not the takeover of this Kurdish enclave will lead to the ethnic cleansing of the Kurdish majority there. The first act of the fighters of the Free Syrian Army (FSA) fighters, an overwhelmingly Arab force, was to bulldoze the statue of a Kurdish mythological hero in the centre of Afrin. Videos taken by FSA fighters suggest that many are former Isis or al-Qaeda fighters who see the Kurds and non-Muslim minorities as enemies to be expelled or eradicated. Some 200,000 Kurds have fled from Afrin over the past few days, many suspecting that they will never be permitted to return. If they are right, they will join the six million Syrians displaced since 2011 and a similar number who have become refugees outside the country. Given that the Syrian population in that year was about 23 million people, more than half have lost their homes in seven years of violence. Afrin was easy pickings for Turkey: it is on the Turkish border and cut off from the main body of Kurdish-held territory east of the Euphrates. The only supply route south to Aleppo was controlled by the Syrian army, which would allow civilians to pass but not arms and ammunition. YPG commanders said that they had 10,000 men in the enclave, but there was never much sign of their presence. The commanders of the Kurdish People’s Protection Units (YPG) were evidently convinced that Afrin was indefensible and pulled out because they had no alternative. If this was the case, then they were wise not to fight to the finish in a battle they were bound to lose with heavy loss of life. The outcome of the struggle for Afrin was evident from the moment the Turkish invasion began on 20 January. The occasion of it was a provocative statement by the then US Secretary of State Rex Tillerson that US forces were going to stay in Syria, thereby guaranteeing the security of the de facto Kurdish state created by the YPG-US military alliance against Isis. By the time Isis was defeated when Raqqa fell last October, the Kurds had gained control of about a quarter of Syrian territory.

Syrian "Rebels" Massacre Civilians In Rocket Attack Days After Assad Drives Himself To Ghouta - On Tuesday evening anti-government fighters in the embattled East Ghouta suburb of Damascus launched a major attack, firing several missiles and artillery shells into a crowded shopping district of government-held Jaramana area, resulting in a civilian massacre. The Guardian has described the attack as "one of the deadliest rebel attacks on the Syrian capital" which according to early reports took the lives of 38 civilians, including women and children. Local reporters say that number may climb higher.  And according to Middle East based Al-Masdar News, which has a correspondent on the ground close to the scene, a near simultaneous attack on the Mezzeh District of Damascus resulted in the deaths of a woman and five children.  The Guardian reports that the particular shopping area in Jaramana hit by a volley of rockets was particularly busy as Mother's Day - celebrated in Syria on March 21 - brought throngs of families into crowded markets: State media said the opposition fire had hit the area of Jaramana, which residents said was full of shoppers – many buying presents before Mother’s Day. A taxi driver, who asked not to give his name, said he had been nearby when the rocket hit a street known for its cheap clothes and food shops. “The place was full of people buying presents for Mother’s Day,” the 41-year-old said. A nurse in her 30s, who asked not to be named, said the projectile had hit a shopping area “next to a security checkpoint”. “The intensity of the blast was terrifying,” she said.Though given scant attention in international media since the start of the now 7-year long war, Damascenes have had to endure living under the constant threat of mortar attack from al-Qaeda linked groups operating in the suburbs and Damascus countryside as "the new normal".

The Syrian war could still be raging in four years’ time unless the US and Russia agree to end it -- “Will the war in Syria ever end?” After seven years of conflict, the same question is being asked by politicians, diplomats, fighters in the front line, and families cowering in unlit basements to escape devastating bombardments from Ghouta to Afrin.When I asked Aldar Khalil, a top Syrian Kurdish leader whose forces control a quarter of Syria, about the chances of peace in an interview in north-east Syria, he grimly but confidently predicted that the war would go on “for another four years, until a new balance of forces becomes clear”.We must speak of multiple armed conflicts in Syria rather than a single war so that when one military confrontation gets close to its final chapter, it is swiftly replaced by another. Isis, the greatest threat of 2014 to 2017, is largely eliminated, but the new focus of violence is the escalating struggle between Turkey and the two or three million Syrian Kurds. The Syrian Army is advancing into Eastern Ghouta and the likelihood is that President Bashar al-Assad will soon have almost complete control of the capital for the first time since 2012. One outcome could be for the rebel fighters to leave with light weapons for opposition or Turkish-held territory in southern and northern Syria, while the bulk of the civilian population would be amnestied and stay where they are. But the Syrian war is littered with compromise solutions which never quite came about because there were too many players to agree on a common course of action.  One siege may be ending in Eastern Ghouta, but another is beginning 200 miles to the north in the Kurdish enclave of Afrin. The Turkish army and its Arab auxiliaries describing themselves as the Free Syrian Army, but, going by their own videos much closer to Isis and al-Qaeda, say they have surrounded the city. It will ultimately fall but it is unclear if the 10,000 Kurdish fighters there will fight to the death. If they do make a last stand, then Afrin will join the many other Syrian cities which have been reduced to rubble.

Russia Claims US Deploys Warships For Imminent Attack On Syria, Trains Militants For False Flag Attack - Last April, in one of the Trump administration's first "diplomatic" ventures, the US fired 59 Tomahawk missiles on Syria, in stated retaliation for the latest alleged chemical attack by the Assad regime, the same "false flag" excuse which was used by the US to officially enter the conflict back in 2013 when military tensions between the US and Russia nearly resulted in a regional war. Well, it appears that Assad is a relentless glutton for punishment, because not even a year later, the WaPo reported two weeks ago that the US is considering a new military action against Syria for - what else - retaliation against Assad's latest chemical attack, which took place several weeks earlier. How do we know Assad (and apparently, Russia) was behind the attack? We don't: in fact, former Secretary of State Rex Tillerson, in a moment of bizarre honesty, admitted that he really doesn't know much at all about "whoever conducted the attacks." But hey: just like it is "highly likely" that Russia poisoned the former Russian double agent in the UK - with no proof yet - so it is "highly likely" that a clearly irrational Assad was once again behind an attack which he knew would provoke violent and aggressive retaliation by the US, and once again destabilize his regime. And so we now wait for that flashing, red headline saying that US ships in the Mediterranean have launched a missile attack on Syria, just like a year ago. Only this time Russia - which is allied with the Assad regime - is not planning to be on the defensive, and according to Russia’s Defense Ministry, "US instructors" are currently training militants to stage false flag chemical attacks in south Syria, i.e., the catalyst that will be used to justify the US attack on Assad. The incidents, the ministry said, will be used a pretext for airstrikes on Syrian government troops and infrastructure. "They are preparing a series of chemical munitions explosions. This fact will be used to blame the government forces. The components to produce chemical munitions have been already delivered to the southern de-escalation zone under the guise of humanitarian convoys of a number of NGOs."

US Building Military Garrison To Control Largest Syrian Oilfield - The US is reportedly establishing an at-Tanf-like military garrison in the Omar oil fields area in the province of Deir Ezzor. Considering the US attempt to maintain a military presence in Syria for as long as possible, Washington may see the Syrian oil and gas resources as useful tool to gain an additional financial revenue from its occupation of the eastern part of the country.A video has also appeared allegedly showing two US-led coalition Blackhawk helicopters landing in the area.On March 19, the Syrian state-run news agency SANA accused the US-led coalition of evacuating four ISIS members from the area between the villages of al-Jissi and Kalu in southeastern countryside of Qamishli.SANA also recalled that on February 26 the US allegedly evacuated a number of ISIS members to the Sabah al-Kheir center, 20 km south of Hasaka, which the US forces are using as center for training militant groups.According to one version, the US is going to use the evacuated ISIS members to create “security threats” in Central Asia. In late 2017 and early 2018 reports appeared that the US had already redeployed some ISIS members from Syria and Iraq to Afghanistan. The ISIS threat will serve as justification for a continued US military presence in the country.Following the military success of the Turkish Army and the Free Syrian Army in Afrin, Turkish President Recep Tayip Erdogan vowed to clear the entire Syrian north, from Manbij to Qamishli, of Kurdish militias, mostly the People’s Protection Units (YPG). He also hinted that the Turkish Army may conduct a large-scale military operation against the PKK in northern Iraq.The Kurdistan Workers’ Party (PKK) is a Kurdish militant separatist organization operating in southern Turkey, northern Syria and northern Iraq. The PKK has for a long time been involved in militancy against the Turkish government and de-facto seeks to establish an independent Kurdish state, which would include territories from Turkey, Syria and Iraq.

Top US General Says American Troops Should Be Ready To Die For Israel -  Earlier this month, in the midst of the 9th annual 12-day massive joint exercise named "Juniper Cobra" which was hailed in Israeli media as the largest of its kind, simulating a "battle on three fronts" (namely, Syria-Lebanon-Gaza Strip) US Third Air Force Commander Lt. Gen. Richard Clark spelled out just such a scenario wherein US troops could be asked to fight and to die for defense of America Israel - even to the point of being placed under Israeli commanders responsible for battlefield decision making.  While major joint military exercises involving significant troop deployments are nothing new for the US and its allies (Juniper Cobra itself has been conducted annually for nearly a decade), Lt. Gen. Clark's words to Israeli media are truly precedent setting and shocking, especially as he is among the highest ranking military officers in the US armed forces. It is well worth reading the alarming scenario Gen. Clark laid out while speaking to the Jerusalem Post in its entirety: But this is where Clark pushes far across the normative "military-to-military partnership" characteristic of joint drills with other allied nations. He says that US troops should be prepared to die for the Jewish State:“As far as decision-making, it is a partnership,” he continued, stressing nonetheless that “at the end of the day it is about the protection of Israel – and if there is a question in regards to how we will operate, the last vote will probably go to Zvika [Brig.-Gen. Zvika Haimovitch, head of the IDF's Aerial Defense Division].”Washington and Israel have signed an agreement which would see the US come to assist Israel with missile defense in times of war and, according to [Israeli commander] Haimovitch, "I am sure once the order comes we will find here US troops on the ground to be part of our deployment team to defend the State of Israel." And those US troops who would be deployed to Israel, are prepared to die for the Jewish state, Clark said. "We are ready to commit to the defense of Israel anytime we get involved in a kinetic fight there is always the risk that there will be casualties. But we accept that - as every conflict we train for and enter, there is always that possibility," he said.