oil prices managed to increase for a 7th week in a row in slow trading in a holiday shortened week, but not by much, as traders remained cautious while waiting for clarification on Iran sanction exemptions that are due to expire in the first week of May...after rising 1.3% to $63.89 a barrel on deeper than expected OPEC output cuts last week, prices of US crude for May delivery fell 49 cents to $63.40 a barrel on Monday after the Russian finance minister was quoted as saying that Russia might decide to boost production to fight for market share, rather than continue the production cuts they agreed to enact with OPEC... however, prices rebounded 1% on Tuesday, as fighting in Libya and falling Venezuelan and Iranian exports renewed concerns about tightening global supply, with US WTI crude ending 65 cents higher at $64.05 a barrel...oil prices continued moving higher early Wednesday, rising as high as $64.61 a barrel in morning trading, before tumbling in the afternoon to settle down 29 cents at $63.76 a barrel after EIA data showed US crude inventories fell less than the American Petroleum Institute had reported late Tuesday...however, oil prices edged back up on Thursday, as a decrease in Saudi Arabia's crude exports, a drop in U.S. drilling rigs, and lower oil, gasoline & distillate inventories underpinned prices, which went on to finish the day 24 cents higher at $64.00 a barrel, thus managing to end the week with a net gain of 11 cents, or less than 0.2% from the prior week's close....
natural gas prices, on the other hand, were down every day this week, as notably warmer forecast changes and higher natural gas production, combined with a record early April storage injection relentlessly drove prices lower...after ending nearly unchanged at $2.660 per mmBTU in trading last week, natural gas contracts for May delivery fell 7 cents on Monday, 1.8 cents on Tuesday, 5.5 cents on Wednesday, and 2.7 cents with the storage report release on Thursday to end the week down 17 cents or 6.4% at $2.490, the lowest weekly close since June 3rd, 2016...
with natural gas prices thus at a 34 month low, we'll include a longer term graph of the intervening price trajectory, to show you how current prices compare to recent historical prices...
the above graph is a Saturday morning screenshot of the interactive US natural gas price graph at Daily FX, an online platform that provides trading news, charts, indicators and analysis of the markets...each bar on the above graph represents natural gas prices for a week of trading between the last week of 2015 and this past week, wherein the green bars represent the weeks when the price of natural gas went up, and red bars represent the weeks when the price of natural gas went down...for green bars, the starting natural gas price at the beginning of the week is at the bottom of the bar and the price at the end of the week is at the top of the bar, while for red or down weeks, the starting price is at the top of the bar and the price at the end of the week is at the bottom of the bar...also barely visible on this shrunken "candlestick" style graph are the very faint grey "wicks" above and below each bar, to indicate trading prices during the week that were above or below the opening to closing price range for that week...note that the lighter red & green bars at the bottom of the graph represent the trading volume for each day, which doesn't concern us, except to note the poor graph design that has similarly colored natural gas price bars crossing into the trading volume metrics...
we can see that through most of 2018 until October, natural gas prices had stayed in a range roughly between $2.60 and $3 per mmBTU, and it was only when the possibility of a wintertime natural gas shortage became widely known that prices began to move higher...then prices shot up to nearly $5 when November turned cold, and withdrawals of gas from storage were much above normal...then, with the milder temperatures and smaller withdrawals from storage during December and January, natural gas traders figured that the crisis had passed, and hence natural gas prices retreated back to below their previous baseline...
with natural gas prices now near a three year low, the question naturally arises as to whether those who continue to drill for gas will be able to maintain profitability or not....circa 2014, before the OPEC glut which hit natural gas prices at the same time as oil prices were diving, widely quoted analysis had it that the so-called break-even price for natural gas wells in the Pennsylvania Marcellus shale was around $4 per mmBTU...in addition to pointing out that no two wells will exhibit common enough characteristics to put any kind of stake in that kind of single figure analysis anymore, we also have to note there have been efficiency and productivity gains since then that have lowered the price of natural gas extraction considerably from those days...still, at prices below $2.50 per mmBTU, we have to consider that some marginal well prospects will be unprofitable, and in many of those cases will not be completed...
note that while some drillers may have been able to lock in the higher prices of that November price spike for their future drilling plans, prices for gas output from most of the wells started during late 2018 were more than likely contracted for months earlier, when natural gas prices were still below $3 per mmBTU...but even with prices at that level or lower for most of the year, US natural gas production still managed to grow by 11% over that of the prior year...with domestic consumption growing at a 10% rate and LNG exports expected to double, production growth with have to continue at the 2018 pace or better to satisfy that demand..
returning to current data, the natural gas storage report for the week ending April 12th from the EIA indicated that the quantity of natural gas held in storage in the US increased by 92 billion cubic feet to 1,247 billion cubic feet over the week, which still left our gas supplies 57 billion cubic feet, or 4.4% below the 1,304 billion cubic feet that were in storage on April 13th of last year, and 414 billion cubic feet, or 24.9% below the five-year average of 1,661 billion cubic feet of natural gas that have typically remained in storage as of the second weekend in April in recent years....this week's 92 billion cubic feet injection into US natural gas storage was a bit above expectations of an 88 to 90 billion cubic foot addition to storage, while it was quite a bit more than the 21 billion cubic feet of natural gas that are normally added to gas storage during the second week of April...in fact, it was the largest addition of natural gas to storage in any week of April in any of the EIA's natural gas storage records..
The Latest US Oil Supply and Disposition Data from the EIA
this week's US oil data from the US Energy Information Administration, reporting on the week ending April 12th, indicated that a large decrease in our oil imports meant that oil had to be withdrawn from our commercial supplies of crude for the first time in 5 weeks...our imports of crude oil fell by an average of 607,000 barrels per day to an average of 5,992,000 barrels per day, after falling by an average of 166,000 barrels per day the prior week, while our exports of crude oil rose by an average of 52,000 barrels per day to 2,401,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 3,591,000 barrels of per day during the week ending April 12th, 659,000 fewer barrels per day than the net of our imports minus exports during the prior week...over the same period, field production of crude oil from US wells was reported to be down by 100,000 barrels per day to 12,100,000 barrels per day, so our daily supply of oil from the net of our trade in oil and from well production totaled an average of 15,691,000 barrels per day during this reporting week...
meanwhile, US oil refineries were using 16,078,000 barrels of crude per day during the week ending April 12th, 22,000 fewer barrels per day than the amount of oil they used during the prior week, while over the same period the EIA reported that 199,000 barrels of oil per day were being withdrawn from the oil that's in storage in the US.....therefore, this week's crude oil figures from the EIA would seem to indicate that our total working supply of oil from net imports, from oilfield production, and from storage was 188,000 fewer barrels per day than the amount of oil refineries reported they used during the week...to account for that disparity between the supply of oil and the disposition of it, the EIA inserted a (+188,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the reported data for the daily 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".... (for more on how this weekly oil data is gathered, and the possible reasons for that "unaccounted for" oil, see this EIA explainer)....
further details from the weekly Petroleum Status Report (pdf) indicated that the 4 week average of our oil imports fell to an average of 6,474,000 barrels per day last week, now 20.6% less than the 8,157,000 barrel per day average that we were importing over the same four-week period last year....the 199,000 barrels of oil per day decrease in our total crude inventories was all pulled from our commercially available stocks of crude oil, as the oil stored in our Strategic Petroleum Reserve remained unchanged...this week's crude oil production was reported to be 100,000 barrels per day lower at 12,100,000 barrels per day because the rounded estimate for output from wells in the lower 48 states was 100,000 barrels per day lower at 11,600,000 barrels per day, while a 6,000 barrel per day decrease in Alaska's oil production to 478,000 barrels per day was not enough to make a difference in the rounded national total...last year's US crude oil production for the week ending April 13th was at 10,540,000 barrels per day, so this reporting week's rounded oil production figure was 14.8% above that of a year ago, and 43.6% more than the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June of 2016...
meanwhile, US oil refineries were operating at 87.7% of their capacity in using 16,078,000 barrels of crude per day during the week ending April 12th, up from 87.5% of capacity the prior week, but still quite a bit lower than before Venezuelan imports of heavy crude that Gulf Coast refineries are optimized to use were cut off....similarly, the 16,078,000 barrels per day of oil that were refined this week were down by 5.1% from the 16,949,000 barrels of crude per day that were being processed during the week ending April 13th, 2018, when US refineries were operating at 92.4% of capacity...
even with the relatively small decrease in the amount of oil being refined, the gasoline output from our refineries was considerably lower, decreasing by 252,000 barrels per day to 9,917,000 barrels per day during the week ending April 12th, after our refineries' gasoline output had increased by 356,000 barrels per day the prior week....with that decrease in gasoline output, this week's gasoline production was 2.8% less than the 10,204,000 barrels of gasoline that were being produced daily during the same week last year....at the same time, our refineries' production of distillate fuels (diesel fuel and heat oil) fell by 215,000 barrels per day to 4,823,000 barrels per day, after that distillates output had increased by 168,000 barrels per day the prior week...and after this week's decrease, the week's distillates production was 5.3% less than the 5,094,000 barrels of distillates per day that were being produced during the week ending April 13th, 2018....
with the decrease in our gasoline production, the supply of gasoline left in storage at the end of the week fell for the 9th week in a row, decreasing by 1,174,000 barrels to 227,955,000 barrels over the week to April 12th, after supplies had fallen by 7,700,000 barrels over the prior week....the draw from our gasoline supplies was less this week than last because the amount of gasoline supplied to US markets decreased by 386,000 barrels per day to 9,420,000 barrels per day, after increasing by 675,000 barrels per day the prior week, and because our imports of gasoline rose by 276,000 barrels per day 990,000 barrels per day, while our exports of gasoline fell by 57,000 barrels per day to 599,000 barrels per day...after having reached an all time record high eleven weeks ago, our gasoline inventories are now 3.4% lower than last April 13th's level of 235,967,000 barrels, and have now fallen to roughly 1% below the five year average of our gasoline supplies at this time of the year...
with the decrease in our distillates production, our supplies of distillate fuels fell for the 22nd time in twenty-nine weeks, decreasing by 362,000 barrels to 127,691,000 barrels during the week ending April 12th, after our distillates supplies had decreased by 116,000 barrels over the prior week...the draw on our distillates supplies was a bit greater this week because our exports of distillates rose by 286,000 barrels per day to 1,660,000 barrels per day, while our imports of distillates rose by 40,000 barrels per day to 138,000 barrels per day while the amount of distillates supplied to US markets, a proxy for our domestic demand, fell by 226,000 barrels per day to 3,553,000 barrels per day...but even after this week's inventory decrease, our distillate supplies were still 1.9% higher than the 125,340,000 barrels of distillate that we had stored on April 13th, 2018, while also still roughly 5% below the five year average of distillates stocks for this time of the year...
finally, with a drop in our oil imports and a decrease in our oil production, our commercial supplies of crude oil in storage decreased for the fourth time in 13 weeks, falling by 1,396,000 barrels over the week, from 456,550,000 barrels on April 5th to 455,154,000 barrels on April 12th...that decrease was enough to knock our crude oil inventories back to 2% below the recent five-year average of crude oil supplies for this time of year, while they remained more than 30% above the prior 5 year (2009 - 2013) average of crude oil stocks after the second week of April, with the disparity between those comparisons arising because it wasn't until early 2015 that our oil inventories first rose above 400 million barrels...since our crude oil inventories have mostly been rising since this past Fall, after generally falling until then through most of the prior year and a half, our oil supplies as of April 12th were 6.5% above the 427,567,000 barrels of oil we had stored on April 13th of 2018, but at the same time still 14.5% below the 532,343,000 barrels of oil that we had in storage on April 14th of 2017, and 10.3% below the 507,312,000 barrels of oil we had in storage on April 15th of 2016...
This Week's Rig Count
Note: due to the holiday, this week's rig count was released on Thursday of this week and thus includes the rig changes over just 6 days; nonetheless, US drilling rig activity decreased for the eighth time in nine such weekly reports, and has now dropped below year ago levels for the first time since 2016....Baker Hughes reported that the total count of rotary rigs running in the US fell by 10 rigs to 1012 rigs over the short week ending April 18th, which was also down by 1 rig from the 1013 rigs that were in use as of the April 20th report of 2018, while well down from the shale era high of 1929 drilling rigs that were deployed on November 21st of 2014, the week before OPEC announced their attempt to flood the global oil market...
the count of rigs drilling for oil fell by 8 rigs to 825 rigs this week, which was still 5 more oil rigs than were running a year ago, while it was still well below the recent high of 1609 rigs that were drilling for oil on October 10th, 2014...at the same time, the number of drilling rigs targeting natural gas bearing formations decreased by 2 rigs to 187 natural gas rigs, which was also down by 5 rigs from the 192 natural gas rigs that were drilling a year ago, and way down from the modern era high of 1,606 natural gas targeting rigs that were deployed on August 29th, 2008...
drilling activity offshore in the Gulf of Mexico remained unchanged at 23 rigs this week, which was still 5 more rigs than the 18 rigs active in the Gulf a year ago...however, the number of active horizontal drilling rigs decreased by 3 rigs to 896 horizontal rigs this week, which was the least horizontal rigs deployed in any week over the past year, and 3 fewer horizontal rigs than the 889 horizontal rigs that were in use in the US on April 20th of last year, and well down from the record of 1372 horizontal rigs that were deployed on November 21st of 2014.....at the same time, the directional rig count also decreased by 3 rigs to 75 directional rigs this week, but that was up by 5 rigs from the 70 directional rigs that were in use during the same week of last year....in addition, the vertical rig count decreased by 4 rigs to 51 vertical rigs this week, which was down from the 54 vertical rigs that were operating on April 20th of 2018...
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 oil & gas producing states, and the second table shows the weekly and year over year rig count changes for the major US geological oil and gas basins...in both tables, the first column shows the active rig count as of April 18th, the second column shows the change in the number of working rigs between last week's count (April 12th) and this week's (April 18th) count, the third column shows last week's April 12th active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running before the equivalent weekend 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 the 20th of April, 2018...
there's not much particularly noteworthy in these counts this week; as you can see, the rig count reductions were fairly widespread and for the most part were in those states with the greatest activity to begin with, save the rig that was shut down in Alaska...with no rig changes apparent in New Mexico, we assumed that the Permian reduction had come out of Texas, and that turned out to be accurate, as a single rig was pulled out of Texas Oil District 8A, or the northern Permian Midland basin, while rig counts in the other Permian regions remained unchanged...the week's natural gas rig reductions were also straightforward; 2 natural gas rigs were removed from the Haynesville shale in northwestern Louisiana, while natural gas rigs operating in all other basins also remained unchanged...
DUC well report for March
Monday of this past week saw the release of the EIA's Drilling Productivity Report for April, which includes the EIA's March data for drilled but uncompleted oil and gas wells in the 7 most productive shale regions...for the first time in 12 months, this report showed a small decrease in uncompleted wells nationally in March, as drilling of new wells decreased and completions of drilled wells increased....while there continued to be a large increase of newly drilled but uncompleted wells (DUCs) in the Permian basin of western Texas and New Mexico, all other regions either saw decreases or little change, thus more than offsetting the Permian increases...for all 7 sedimentary regions covered by this report, the total count of DUC wells decreased by 4 wells, from a revised 8,504 DUC wells in February to 8,500 DUC wells in March, still a 25.6% increase from the 6,769 wells that had been drilled but remained uncompleted as of the end of March a year ago...that was as 1,388 wells were drilled in the 7 regions that this report covers (representing 87% of all U.S. onshore drilling operations) during March, down by 14 from the 1,423 wells drilled in February and the lowest in 11 months, while 1,392 wells were completed and brought into production by fracking, a increase of 113 well completions from the 1,327 completions seen in February and the 1212 completions of January...at the March completion rate, the 8,500 drilled but uncompleted wells left at the end of the month represent a 6.1 month backlog of wells that have been drilled but not yet fracked...
in a contrast with what we've seen over most of the past couple of years, a number of the March DUC well decreases were in oil producing regions, with the Anadarko basin region centered in Oklahoma seeing the largest drop... DUC wells left in the Anadarko decreased by 29 to 1,019, as 139 wells were drilled into the Anadarko basin during March while 168 Anadarko wells were being fracked....at the same time, DUC wells in the Bakken of North Dakota fell by 12, from 722 DUC wells in February to 710 DUCs in March, as 113 wells were drilled into the Bakken in March, while 125 of the drilled wells in that basin were completed...in addition, the drilled but uncompleted well count in the Appalachian region, which includes the Utica shale, fell by 8 wells, from 509 DUCs in February to 501 DUCs in March, as 130 wells were drilled into the Marcellus and Utica shales, while 138 of the already drilled wells in the region were fracked...and in a major change from recent months, DUC wells in the Eagle Ford of south Texas decreased by 5, from 1,514 DUC wells in February to 1,509 DUCs in March, as 203 wells were drilled in the Eagle Ford during March, while 208 Eagle Ford wells were completed...
on the other hand, the Permian basin of west Texas and New Mexico saw its total count of uncompleted wells rise by 49, from 3,972 DUC wells in February to 4,021 DUCs in March, as 554 new wells were drilled into the Permian, but only 505 wells in the region were fracked...in addition, the natural gas producing Haynesville shale of the northern Louisiana-Texas border region also saw their uncompleted well inventory increase by 1 well to 212, as 57 wells were drilled into the Haynesville during March, while 56 Haynesville wells were fracked during the same period...lastly, the drilled but uncompleted well count in the Niobrara chalk of the Rockies' front range remained unchanged at 528, as 192 Niobrara wells were drilled in March while 192 Niobrara wells were being fracked...thus, for the month of March, DUCs in the five oil basins tracked by in this report (ie., the Anadarko, Bakken, Niobrara, Permian, and Eagle Ford) increased by a net of 3 wells to 7,787 wells, while the uncompleted well count in the natural gas basins (the Marcellus, Utica, and the Haynesville) decreased by 7 wells to 713 wells, although as the report notes, once into production, more than half the wells drilled nationally will produce both oil and natural gas...
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ODNR Issues 13 Permits in Utica Shale – Thirteen horizontal well permits were issued last week to one energy company exploring Ohio’s Utica shale for oil and gas reserves, according to the latest data from the Ohio Department of Natural Resources. ODNR reports that Ascent Resources Utica LLC, based in Oklahoma City, was awarded all of the permits approved for the week ended April 13. The company secured permits for well sites in Belmont, Harrison and Jefferson counties in the southern portion of the play.No permits were issued to any other companies or to prospective wells in the northern Utica, which includes Mahoning, Trumbull and Columbiana counties. As of April 13, ODNR had approved 3,059 permits for horizontal wells in Ohio’s Utica. There are 2,571 of these wells drilled and 2,179 in production, according to the latest data.The rig count across the Utica play during the week remained unchanged from the previous week at 16. No new permits issued in the northwestern Pennsylvania sector of the Utica, which includes Lawrence and Mercer counties, according to the Pennsylvania Department of Environmental Protection.
Pin Oak Energy acquires 43000 Utica acres— Pin Oak Energy Partners LLC is closing a transaction with SWEPI LP (Shell) for approximately 43,000 acres prospective for Utica Shale development in northwestern Pennsylvania. The transaction increases Pin Oak Energy’s acreage position across the Appalachian Basin to 167,000 net deep acres with 99% of those net deep acres being held by production. Pin Oak Energy’s net deep acre position in Mercer, Crawford and Venango counties increased to 60,000, 5,500 and 7,100 respectively. The company now touts 64,000 net deep acres in Ohio and 103,000 net deep acres in Pennsylvania. The acquisition also includes drilled and completed, but not online, horizontal Utica Shale wells along with previously built, but not drilled, well pads. The company currently operates wells producing nearly 14.0 MMcfe/d net (11% liquids), over 125 miles of midstream assets, and maintains 178,000 net acres (167,000 net deep acres) in the basin.
Ohio EPA Looks to Update Air Quality Rules at Fracking Sites - WKSU - The Ohio EPA is considering changes to its regulations on air quality at fracking and natural gas transmissions sites. The state Environmental Protection Agency is doing what deputy director Heidi Griesmer calls a periodic rules review. One thing it is considering has to do with changes in regulations. Normally they’re applied to new shale wells or compressor stations coming on line. The agency may make them applicable to established sites too. “This would cover air pollution emissions from existing non-conventional oil and gas facilities that aren’t covered by our most current regulations.” As part of the review the sate EPA is also gathering input from interested parties. “It’s just an extra step we take to involve stakeholders before we begin drafting rules.” The open period for ideas is underway through December 19th.
Ohio Residents Sick Of Dealing With PA's Fracking Wastewater - Much of the wastewater from Pennsylvania’s fracking industry is trucked across the border to Ohio. Last year, Pennsylvania and West Virginia contributed nearly half of the more than a billion gallons of frack waste that were injected into underground wells in Ohio. Residents in at least one county say they’ve had enough. Michelle Garman remembers News Years Eve 2011, when a 4.0-magnitude earthquake shook nearby Youngstown, Ohio. Around a dozen smaller quakes followed. The state determined that the quakes were caused by an injection well. And one in New Castle, Pennsylvania was linked to fracking as well. The well believed to have caused the Youngstown quakes has been closed permanently. Garman describes big trucks carrying chemical-laced wastewater that squeal into the site at all hours. She can hear the pump from her yard. And Garman fears for her family.“How does it affect our health, my son’s health?” she wondered. “I mean, it is toxic. Plain and simple, that’s poison that they’re pumping into the ground.”Garman says her concerns didn’t get much response from the Ohio Department of Natural Resources (ODNR), the agency with authority over injection wells. In Ohio, there’s no local control of the oil and gas industry. And few leaders in her town would criticize the local company, Kleese Development Associates, that built the well next to her property.Then, in April of 2015, a waste oil spill caused a slew of dead animals and a polluted nearby wetlands. It was caused by another injection well owned by Kleese.Garman says neighbors contacted her for help. “People were scared,” she said. “[The were asking], ‘can I drink the water, can I bathe my children in it, can I cook with it?”
Study ties fracking to radioactive wastewater - Two Dartmouth studies recently established a link between fracking and the production of radioactive wastewater. Lead researcher and senior research scientist Josh Landis and his team found that the prevalent radioactive material in wastewater after hydraulic fracking comes from the interaction between slick water and black shale.“Prior to our work, everyone was assuming that the radium was from pre-existing [briny water] found underground,” Landis said.However, Landis added the study points to the controversial oil and gas extraction method as the cause of this radioactive waste.“We are able to argue pretty vigorously that the fracking itself is producing the fluid,” he said. “[This] shows that the frackers are responsible for its creation, and if you want to minimize its production, you have to do that through their process.” According to Sharma, radioactive wastewater cannot currently be treated. It is either mixed with fresh water and used to frack again, or it is sent away to be buried into the ground. For example, radioactive wastewater from fracking locations in Pennsylvania may be sent to Ohio, Sharma said. The first study — focused on the rapid desorption of radium from black shale — found that radium comes from both organic and mineral surfaces as the wastewater moves toward the surface. The second study contextualized the first study’s findings with the available data from research in fracking on radium isotopes.
Taking a Long Look at the Risks of Fracking - Researchers at the Johns Hopkins Bloomberg School of Public Health reviewed numerous studies on the effects of fracking activity on the health of a community and the people who live close to natural gas wells. They found that there is strong evidence–despite an industry narrative to the contrary–that fracking exposure is associated with an increased risk of preterm birth and high-risk pregnancy, asthma flare-ups, fatigue and possibly low birth weight. In the review paper published in Global Public Health, authors note that, while natural gas is promoted as a less harmful “bridge” fuel to be used until more renewable sources take over, the fracking infrastructure in rapid development today throughout the U.S. and beyond is not temporary. It is too soon, given the relative newness of the technology, to determine possible effects on rates of cancer and neurological diseases. But the epidemiological data to date “offers no reassurances.” Co-author Irena Gorski told Environmental Health News, “We have enough evidence at this point that these health impacts should be of serious concern to policymakers interested in protecting public health.”
After a decade of research, here’s what scientists know about the health impacts of fracking - Fracking has been linked to preterm births, high-risk pregnancies, asthma, migraine headaches, fatigue, nasal and sinus symptoms, and skin disorders over the last 10 years, according to a new study. The study, which was published in the Oxford Research Encyclopedia of Global Public Health in February, looked at several hundred scientific articles about the community and health impacts of fracking. The researchers focused on the design of those studies to ensure that the ones they included in their study were scientifically valid, then summarized what's been learned about the industry in the last decade. "What we found pushes back against the narratives we often hear that say we don't know enough about the health impacts yet," Irena Gorski, co-author of the study and an environmental epidemiology doctoral candidate at the Johns Hopkins Bloomberg School of Public Health, told EHN. "We have enough evidence at this point that these health impacts should be of serious concern to policymakers interested in protecting public health," Gorski said. She added that, while they found a number of documented health impacts, the ones with the most evidence for concern are negative impacts on pregnancy and birth outcomes. Evidence suggests women living closer to fracking have increased odds of having a baby with lower-than-average birth weight; of having a high-risk pregnancy; or having a baby with a low infant health index.
Oakmont approves new ordinance to ward off fracking - - The fracking industry has slowly been encroaching on Allegheny County’s suburbs over the past few years. Oakmont residents displeased with this trend have taken steps to ensure their borough won’t be home to anatural-gas drilling anytime soon. Last week, Oakmont Borough Council voted to approve an updated Oil and Gas Well Ordinance. The amended ordinance expands definitions for natural-gas development infrastructure, restricts all oil and gas development to industrial zones, and sets a 2,000-foot setback from property lines. Oakmont’s updated zoning ordinance is the result of months of work by residents seeking more protections from drilling in the area. Fracking company Huntley & Huntley notified the borough in June 2017 that it was about to begin “seismic testing,” a process of setting off explosive charges in deep holes to find where gas may be trapped. This inspired Oakmont residents to consider ways to regulate fracking in the area, including modifying the existing zoning ordinance.Huntley & Huntley pulled back on their planned surveys soon after, but residents continued to push for an updated ordinance. The local group Citizens to Protect Oakmont offered a list of suggestions to borough council in Dec. 2018, including restricting fracking to only industrial zones, a 2,000-foot setback from residential properties, the removal of fracking from Oakmont’s light industrial district (which comprises a limo company, a landscape supply yard, a park and green space), and more transparency from drilling companies.The council initially considered passing a notably weaker measure which would have left open possibilities for fracking in residential areas. But after continued pressure from community members, the council opted for a stronger ordinance. According to research from the oil and gas watchdog FracTracker Alliance, nearly a fifth of Allegheny County is leased to gas drillers.
Mariner East 2 pipeline draws heat at Haverford hearing— Speakers at the Haverford Community Action Network (H-CAN) meeting Sunday invoked chilling fears about what might happen to them, their children and their communities if the Mariner East pipelines that are sending highly volatile substances though heavily populated towns in Chester and Delaware counties should experience a serious problem. Eric Friedman with the group Del-Chesco United for Pipeline Safety said that his background in commercial aviation risk led him to the conclusion that all of those two suburban counties are “high consequence” areas, meaning if a pipeline leak resulted in an explosion many people would die or be injured. “There is no acceptable plan to protect the public from leaks,” he told an audience of about 35 people who came to Hope United Methodist Church. The Mariner East project is a series of pipelines that eventually will transport hundreds of thousands of barrels of volatile liquid gases every day across the full 350-mile width of Pennsylvania to a facility in Marcus Hook. Mariner East 1 is currently shut down after sinkholes formed for the second time in a Chester County Community. Mariner East 2 went online the last week of December, although utilizing a hybrid mish-mash of pipes instead of the new 20-inch pipe originally proposed. A series of construction delays and state-mandated work stoppages have put Mariner East 2 behind schedule. The full 20-inch pipeline now is not expected to be completed until at least 2020. Mariner East 2x remains under construction. The Mariner East pipelines traverse 23 miles through the heart of central Chester County and another 11 miles through western Delaware County as it snakes its way toward the facility in Marcus Hook, where the gases will be stored and eventually shipped to customers, most overseas. The project has been the target of vehement opposition from citizen groups and local legislators, and is the focus of no less than two criminal investigations.
Property owners along Atlantic Sunrise pipeline in Lancaster County get another round of letters -- One company’s efforts to get paid for work on the Atlantic Sunrise natural gas pipeline that runs through Lancaster County have led to a settlement, and now another company is starting down the same path.Chris Stockton, spokesman for Atlantic Sunrise owner Williams Partners, said in an email this week that Michigan-based MacAllister Machinery Co. Inc. has settled with the bond surety Federal Insurance Company.MacAllister was behind letters sent last month to Lancaster County residents who own land the pipeline crosses. The letters issued notice of intent to file liens if MacAllister didn’t receive timely payment of about $1.02 million it asserted was owed by Welded Construction LP, the main contractor on both the Atlantic Sunrise and Sunoco Mariner East pipelines.Joseph R. Spoonster is an attorney at the Ohio firm of Harpst Ross & Becker Co. LLC, which sent the letters on behalf of MacAllister.He said this week that the firm has sent similar letters to Lancaster County landowners on behalf of Ohio Machinery Company, which is seeking about $4.5 million from Welded Construction LP. A similar situation played out in Berks County late last year, with letters threatening liens from a Minnesota company that said Welded hadn’t paid it for work on the Mariner East Pipeline. Sunoco, which owns that pipeline, said shortly afterward that the situation had been resolved.
State senator wants to block sale of Pa.-produced natural gas to anti-fracking neighbors - As Pennsylvania’s natural gas industry has boomed, neighboring states including New York, New Jersey, and Maryland have taken steps to curtail gas drilling and infrastructure. Now, a state senator wants to prevent them from purchasing gas produced in Pennsylvania. Sen. Gene Yaw, R-Lycoming, who chairs the Senate Environmental Resources & Energy Committee, announced at a natural gas industry conference Wednesday that he intends to introduce a bill blocking the transportation and sale of Pennsylvania-produced natural gas to states that have blocked fracking and pipeline expansions. The remarks, delivered in Yaw’s keynote speech at the UpStream PA conference, were first reported on a blog written by former Department of Environmental Protection Secretary Dave Hess. The conference was hosted by groups with ties to the Marcellus Shale drilling industry. In his address, Yaw took aim at New York Gov. Andrew Cuomo, who has led that state’s ban on hydraulic fracturing — or fracking — and pipeline expansions. New York continues to process imported natural gas, including large volumes from Pennsylvania. Yaw told gas industry professionals that those policies have “stalled infrastructure development” that’s necessary to create new markets for natural gas in the U.S. and across the world, leading to price disparities that benefit international competitors at the expense of Pennsylvania producers. Yaw noted that states have imported gas from Russia since New York scaled back its own gas production. “As lawmakers, we have an obligation to be aware of the competing interests that involve our state and the nation,” Yaw said, according to remarks published by his office. “New York, New Jersey and Maryland have worked to limit the expansion of pipelines, which curtails our ability to market Pennsylvania produced natural gas. In keeping with the wishes of those states to impede marketing, I intend to introduce a measure, which would prohibit the transportation and sale of any Pennsylvania natural gas that is produced by fracking to those states.” It’s unclear whether Yaw’s proposal would violate the U.S. Constitution’s commerce clause, which says that only Congress has the power to regulate international and inter-state trade.
Companies tout economic benefit of gas drilling while seeking tax breaks - Earlier this year, at a legislative breakfast in Charleston, representatives from two of West Virginia’s natural gas associations spoke about the economic benefits of the industry.The state was prospering thanks to the oil and gas industry, said Charlie Burd, executive director of the Independent Oil and Gas Association of West Virginia. In 2018, the industry contributed $139 million in severance taxes, and $88 million and property taxes, Burd told the room. This wasn’t the first time Burd, or other industry officials, promoted the gas industry’s positive influence. But while Burd was trumpeting the industry’s contributions to tax coffers, major producers were quietly litigating against multiple counties and state tax officials to dramatically slash those tax payments. Those cases rose to the West Virginia Supreme Court, where lawyers for the industry argued vigorously just last month for the justices to back formulas that would curb their property tax payments. One month after Burd’s presentation, lawyers for the West Virginia Tax Department, as well as the Doddridge County Tax Department, stood in front of the justices, asking that they reverse a Business Court Division ruling on the value of natural gas wells in four counties. In each case, the Business Court Division ruled that the state Tax Department failed to assess gas wells operated by CNX Gas Co. or Antero Resources “at their true and actual value.”In several cases, the companies argued that this was a violation of the state constitution. The Business Court agreed with that assessment.The Supreme Court’s decision to uphold the Business Court’s ruling could have a devastating impact on the state,county and state department lawyers argued in legal briefs and in front of the Supreme Court justices in March.Those cuts would hurt schools and local governments, shattering their ability to provide for their citizens, opponents say. Several letters compiled into an amicus brief by the West Virginia Association of County Officials Inc. describe the potential effects the Business Court’s decision would have on services, such as the maintenance and repair of roads, police protection and emergency services.
Exclusive: Air Permit OK’d After New Evidence of Carcinogens at Enbridge’s Planned Gas Facility in Massachusetts Left out - In the Greater Boston area, Enbridge is planning to build a controversial natural gas facility at a densely populated site which already has elevated levels of previously unreported carcinogens, documents obtained by DeSmog suggest. Despite receiving new information indicating the current presence of these pollutants in the air around Enbridge’s proposed gas compressor station in Weymouth, the Massachusetts Department of Environmental Protection (DEP) did not include the data in the project’s health impact assessment (HIA) which it oversaw. The assessment, which was published 10 days later, found that human health likely will not be affected by direct exposure to the station. Shortly afterwards, the DEP permitted the facility — a 7,700 horsepower compressor station that will pump natural gas through pipelines and a key part in Enbridge’s Atlantic Bridge project to upgrade its pipeline capacity. The air quality permit, which was essentially greenlighted by the HIA’s findings, is currently under appeal before the DEP. During last year’s HIA — which was ordered by Governor Charlie Baker following a public outcry over the project — the DEP conducted air sampling to establish baseline conditions near the compressor station site. This effort combined 24-hour air sampling canisters, which were sent to a private lab for analysis during a five-week period in July and August, and sampling in intervals to record several compounds for four months. Although the sampling found some elevated levels of the carcinogens formaldehyde and benzene, the HIA concluded that existing air quality levels were such that additional emissions from the station are not likely to affect human health through direct exposure. Yet according to documents obtained by DeSmog through a public records request, the DEP also sent sample canisters from the compressor site during August and September to the Rhode Island Department of Public Health’s (RIDOH) air lab to “verify” its measurements during the HIA. The existence of these samples was not reported in the HIA.
Crews working to clean up oil spill at Five Mile Pond in Springfield - - Crews are working to clean up an oil spill at Five Mile Pond in Springfield. According to Springfield Fire Spokesperson Dennis Leger, firefighters were called to the pond at 968 Boston Road at 9:28 a.m. for a fuel spill. Leger said the rescue squad tried to contain the spill and determine how big the leak was and where it was coming from. Massachusetts Environmental Police and the Department of Environmental Protection have since taken over the clean-up. The pond is closed to boats until the spill has been cleaned up completely.
Don't roll back standards for pipelines – Citizens Voice Editorial - The American natural gas and oil boom that has been spawned by advanced deep-drilling technology would be even more so if the abundant gas could be delivered safely to more markets that need it. Foremost among those markets is cold and snowy New England, which should be among the primary markets for natural gas extracted from the Marcellus and Utica shale formations of Pennsylvania. But some New England markets sometimes buy gas overseas because there is no safe, reliable delivery method for the gas produced a few hundred miles to the southwest. New York State has rejected permits for the Constitution Pipeline, which would carry Pennsylvania gas from Susquehanna County across the Empire State to New England. There are similar situations in other parts of the country, where potential markets including international export terminals are cut off from massive gas supplies due to incomplete interstate pipeline projects. President Donald Trump signed an executive order recently directing the Environmental Protection Agency to issue new pipeline permitting guidance to states, focusing on “the need to promote timely federal-state cooperation and collaboration” and “the appropriate scope of water quality reviews.” New York’s permit reactions were based largely on water quality concerns, and problems with several pipelines in Pennsylvania give credence to those concerns. Federal-state cooperation and collaboration is a good thing for interstate projects. The problem with the Trump administration, though, is that its answer to most industrial-environmental disputes is to simply roll back environmental standards that are rooted in experience and science. Pipelines indisputably are the safest and most economical means to transport large amounts of gas. Federal-state cooperation should come in the form of holding industry to high water-quality standards rather than rolling back those standards to expedite pipeline development.
Industry Reaction to Trump's Executive Orders - Several industry associations have reacted positively to President Donald Trump’s executive orders signed yesterday, which make it harder for states to block pipelines and other energy projects. The Independent Petroleum Association of America (IPAA) welcomed Trump’s actions, with IPAA Executive Vice President Lee Fuller stating in an organization release that the IPAA “consistently has supported development of much needed infrastructure to transport America’s oil and natural gas resources to consumers”. Fuller added that the IPAA supports, in particular, the aspect of the executive orders that calls on the Environmental Protection Agency to update the interim 2010 guidance over permitting under Section 401 of the Clean Water Act (CWA). “This guidance, overdue for updating, has allowed for implementation of the CWA in a manner inconsistent with the statute and to inhibit projects that are clearly in interstate commerce,” Fuller continued. The Association of Oil Pipe Lines (AOPL) and the American Energy Alliance (AEA) both applauded Trump’s new orders. AOPL President and CEO Andy Black stated in an organization release that the President “knows pipelines are good for the American economy, create good-paying jobs and help consumers”. Commenting in an AEA statement, the organization’s president Tom Pyle said, “for America to operate from a position of strength, we must have the critical energy infrastructure to deliver affordable energy to power our lives”. Pyle stated that the executive orders are an attempt to make necessary changes to ensure federal statute is properly interpreted and followed and make certain that politically motivated delays blocking pipeline infrastructure come to an end. “It’s time to let America’s energy flow freely through pipelines which are a proven, safe, and efficient way to transport our resources,” he added. Todd Staples, president of the Texas Oil & Gas Association, said the organization appreciated the administration’s work to bring clarity and certainty to the pipeline construction permitting process. “Politically-motivated delays and pipeline bottlenecks in the Permian Basin and around the United States are hindering growth,” he added.
U.S. natural gas inventories end withdrawal season at lowest level since spring 2014 - Working natural gas in storage in the Lower 48 states at the end of March totaled 1,137 billion cubic feet (Bcf) according to EIA’s Weekly Natural Gas Storage Report. As of March 31, the usual end of the natural gas withdrawal season, working natural gas inventories were 30% lower than the previous five-year average for that time of year. This end-of-season level was the lowest since 2014, when working natural gas inventories at the end of March 2014 totaled 837 Bcf. Working natural gas inventories entered the winter heating season in November 2018 at 3,198 Bcf—the lowest level for that time of year in more than a decade—and declined during the winter at a rate consistent with historical trends. In November 2018, relatively cold weather resulted in 206 Bcf of natural gas withdrawals, almost twice as much as a typical November. However, the pace of withdrawals slowed during December, with a monthly total of 320 Bcf compared with the five-year average of 523 Bcf. Net withdrawals in the remaining months of the 2018–2019 withdrawal season were within 20% of their typical values. EIA’s Natural Gas Storage Dashboard provides visualizations of natural gas storage levels across the Lower 48 states as well as other factors that affect the amount of natural gas withdrawn from or injected into storage.
Natural Gas Is Holding - After trading to a high at $4.929 per MMBtu in mid-November 2018 and falling to a low at $2.543 in mid-February, the price of nearby natural gas futures was sitting at the $2.66 per MMBtu level at the end of last week. Natural gas is holding, at least in part, because the energy commodity moved into the peak season for demand with the lowest level of inventories in years. As the 2018/2019 withdrawal season ended recently, the natural gas market headed into the 2019 injection season with the lowest level of stockpiles since 2014 as inventories hit a low at 1.107 trillion cubic feet. In the past, natural gas demand peaked in the winter months as demand for heating increased and declined after March when the gas flowed into storage during typical years. However, the changes in the fundamental equation in the natural gas market continues to change the supply and demand dynamics. While massive reserves of gas in the Marcellus and Utica shale regions, technological advances in fracking, and fewer regulations under the current administration have driven productions to record levels, the demand side of the equation has expanded alongside supply as necessity is the mother of invention. With the injection season underway, the second increase in inventories was a little less than I had expected. My projection was for a rise of 35 billion cubic feet in stocks, but they came in at 25 bcf on Thursday, April 11, for the week ending on April 5. As the chart highlights, stockpiles stood at 1.155 trillion cubic feet for the week ending on April 5 after reaching a bottom at 1.107 tcf at the end of the 2018/2019 withdrawal season. Stocks were 13.7% below last year's level and 29.6% under the five-year average for this time of the year. Stocks remain at the lowest level since 2014 when they reached a low at 824 billion cubic feet. Neither the low level of stocks compared to past years, or an only 25 bcf injection caused any support for the price of natural gas futures on NYMEX. As the 10-minute chart illustrates, the price of May futures fell from the $2.70 to $2.71 per MMBtu level before the EIA's data release to the $2.67 level on Thursday. On Friday, April 12, the price of the energy commodity settled the week at $2.66 per MMBtu. The daily chart shows, since the beginning of April, May natural gas futures have settled into a trading range between $2.632 and $2.7290. Both price momentum and relative strength metrics are in the lower region of neutral territory. Open interest, the total number of open long and short positions in the natural gas futures market, is holding steady at 1.234 million contracts.
US Shale Gas Swamps Market -- Natural gas futures tumbled to the lowest in almost three years as U.S. shale output swamps the market amid mild spring weather, soothing concern about a potential supply crunch next winter. A seasonal lull in heating and cooling demand, coupled with surging production, is accelerating gains in stockpiles of the fuel in underground caverns and aquifers. While inventories are more than 30 percent below normal, they’re poised to refill quickly: Analysts predict that stored supplies probably rose by more than quadruple the average last week. Though gas demand has climbed as new U.S. export terminals send super-chilled cargoes to buyers as far away as Japan, soaring production continues to dog the market. In the Permian Basin of West Texas and New Mexico, where the fuel is pumped as a byproduct of oil exploration, gas supply has overwhelmed the capacity of pipelines to carry it out of the region, pushing prices below zero on some days. ‘‘This is below the multi-year low and we are basically in no man’s land right now.’’ Gas for May delivery fell 4.8 cents to $2.524 per million British thermal units at 11:14 a.m. on the New York Mercantile Exchange after earlier sliding to $2.517, the lowest since June 9, 2016. Prices are down 14 percent this year. Stockpiles probably rose by 88 billion cubic feet last week, based on analysts’ estimates. That compares with a five-year average gain of 21 billion for the period, U.S. Energy Information Administration data show. Production, meanwhile, is at the highest for the time of year in Bloomberg data going back to 2014. ‘‘We have just a lot of gas production in this country,’’ Yawger said. ‘‘Storage is in fact pretty far behind last year, but you can have as much gas as you want and as soon as you want it. That’s what’s killing the market.’’
EIA Reports 92 Bcf Storage Build as May Natural Gas Futures Sit Near $2.50 - The Energy Information Administration (EIA) reported a 92 Bcf injection into storage inventories for the week ending April 12, a build that was on the higher end of market expectations and a few Bcf above consensus.May natural gas prices, which had already sunk just below the critical key support level of $2.50 ahead of the EIA’s report, bounced a bit after the print hit the screen, trading at $2.502. By 11 a.m. ET, the May Nymex gas futures contract had moved back to $2.517, flat to Tuesday’s settle.Bespoke Weather Services, which had called for an 88 Bcf injection, said much of this week’s selloff may have been driven by the fear that the market could see its first triple-digit injection of the season already.“This does still reflect loose balances, though not quite as loose as the last couple of weeks, and we suspect that next week’s number will be somewhat tighter also, as we find it very difficult to imagine that balances will not show meaningful tightening ultimately, given price levels sitting at multi-year lows,” Bespoke chief meteorologist Brian Lovern said. “As such, our view remains that we are near a bottom, if not have already set one, but confidence not increased until we see early next week’s data.”Blue Gold Research’s Adrian Bakker, research chief, agreed that any additional downward spiral is rather limited at this point. Speaking on Enelyst, an energy chat room hosted by The Desk, Bakker said part of the reason for the recent price plunge is because “too many intermediaries were caught with too many long positions. So once they started to liquidate, the floor disappeared, so to speak.”Bulls have capitulated completely and the market price has therefore departed from fundamental factors, he said. “The price is now below ‘fair value’, and it doesn’t even matter how you calculate the ‘fair value.’”At $2.50, Blue Gold expects to see 8 Bcf/d of potential coal-to-gas switching, which will exert a bullish pressure on the end-of-season storage index. “Over the course of this injection season, we currently project 29 builds of 80 Bcf (on average). The year/year storage surplus should be around 400 Bcf by October, but in terms of the five-year average, the storage will still be in deficit in our opinion,” Bakker said.
Duke Energy nixes plan for Lake Julian gas-fired peaker plant — Duke Energy's plan to build a more than $100 million plant at Lake Julian to accommodate increased electricity production during peak demand times now will be on hold for at least 15 years. The gas-fired plant — which would have been used to ensure electricity production during increased consumption, particularly in the winter — was proposed by Duke because of a projected increase in energy usage in the growing Asheville area. Originally slated to build in 2023, it now has removed the plant from its list of future projects. That means the company has no plans to build the 190-megawatt peaker plant until at least 2032. The plant would have primarily used hydraulic fracked natural gas — largely from Texas, Pennsylvania and Oklahoma — in times of high demand as part of the company's combined utilities in Western North Carolina. If electrical demand at peak times starts to grow again, however, Duke may reconsider the project. "But I'm also here to make a call to action and say we're not done yet," said Jason Walls, Duke's spokesman. "And we're going to be at the table with this community each and every step of the way." Members of the Energy Innovation Task Force, a more than three-year-old collaboration between businesses, local government and nonprofits, made the announcement during an April 18 press conference. Delaying the construction of the plant was one of the group's primary goals. Officials pointed to the community's energy-reducing efforts as the reason for Duke's decision, including work by Mountain Housing Opportunities and the Energy Savers Network. MHO enrolled 600 residents in Duke's EnergyWise Home program and Energy Savers Network assisted more than 150 homes last year with weatherization and other efforts to lower utility bills.
Florida LNG Project Hits Milestone -- Eagle LNG Partners reported Friday that it has received the final environmental impact statement (FEIS) from the U.S. Federal Energy Regulatory Commission (FERC) to construct the Jacksonville LNG Export Facility in northeast Florida. Receiving the FEIS marks the final step in the environmental review process before the final federal authorization decision deadline and anticipated FERC approval of the Jacksonville LNG project, Eagle LNG noted. “Achieving this critical milestone is a significant step forward for Eagle’s Jacksonville LNG Export Facility as we continue to advance our efforts to supply clean-burning, domestic and affordable LNG for marine bunkering and small-scale LNG export to both domestic and international markets,” Sean Lalani, Eagle LNG president, said in a written statement. “We appreciate the continued support we have received from regulators, the Jacksonville and North Florida communities and local agencies.” Eagle LNG, a unit of The Energy & Minerals Group’s portfolio company Ferus Natural Gas Fuels LP, initiated the FERC process for the approximately $500-million project in December 2014. Intended to support the Caribbean power generation market, the small-scale LNG facility along the St. Johns River will initially comprise three liquefaction trains capable of producing up to 1.65 million gallons of LNG per day or approximately 1 million tonnes per annum, Eagle LNG stated. The FEIS is available on FERC’s website. According to a timeline on the Eagle LNG website, construction could start during the second half of this year and the facility could begin service in 2021. Another small-scale LNG project, Pivotal LNG and NorthStar Midstream, LLC’s JAX LNG liquefaction facility, began operations in Jacksonville last year.
US Anti-Fracking Groups Demand Probe of Earthquakes Near State of Florida Border - Recent earthquakes near a border separating the US states of Florida and Alabama need to be investigated for links to oil and gas drilling before Florida issues any new permits for hydraulic fracturing (fracking), environmental groups said in a press release on Wednesday. "Out of precaution, state agencies should put a pause on the issuing of any new permits in the area," Earth Action Director Mary Gutierrez said in the release. "Our group has filed a petition for an administrative hearing to challenge an intent to issue [permits] for additional drilling in the Jay area." On Wednesday, environmental and water advocacy groups gathered at Florida's Escambia County government complex to call on Governor Ron DeSantis to fully investigate 12 recent earthquakes near the Florida-Alabama border that may be linked to oil and gas operations, the release said. Geologists have known for years that oil drilling in the region extending from Southern Alabama to the Jay Field in Escambia County may be prone to man-made earthquakes as a result of fracking, the release said. As far back as 1999, the USGS [US Geological Survey] found some evidence that a series of tremors in the Florida Panhandle could be related to oil operations, the release said. In 2015, the USGS also added the region to the list of areas likely to see an uptick in tremors from oil waste injection wells, the release said. In 2016, the USGS confirmed that oil and gas operations were indeed inducing seismic activity in the states of Oklahoma, Arkansas, and Ohio, according to the release.
Environmentalists cite report on Florida oil spills as bid to ban fracking stalls - A set of bills that would ban some forms of fracking in Florida have likely stalled out in the Legislature, leaving environmentalists discouraged and petroleum industry representatives hopeful.People from the petroleum industry have said they are responsible for what they do and want to continue drilling and discovering new opportunities for oil in Florida as they have for the last 70 years.But drilling can cause accidents, leaks and spills because of a variety of reasons, including leaky well casings, traffic accidents and pipeline bursts, according to national advocacy group Food & Water Watch. Environmentalists who have testified at bill hearings say fracking in Florida’s porous geology escalates the risk of contaminated soil and drinking water.And a new report based on data from the Department of Environmental Protection shows that between 2015 and 2018, conventional oil drilling led to 35 spills, averaging nine a year. While fracking isn’t part of Florida drilling operations now, environmentalists fear its future use will contribute to a similar pattern of incidents. Oakley Shelton-Thomas, a researcher with Food & Water Watch, said their estimate of the number of spills is conservative because it only counted surface spills, not underground well-casing leaks. He pointed out that the largest volume spill recorded in the report was in Collier County in 2015, where 10,000 gallons of waste water and oil spilled from a ruptured oil tank. In 2018, more than 2,000 gallons of a combination of crude oil and waste water was released into the Big Cypress National Preserve in Collier County.
New report examines the safety of using dispersants in oil spill clean ups - A multi-disciplinary team of scientists has issued a series of findings and recommendations on the safety of using dispersal agents in oil spill clean-up efforts in a report published this month by the National Academies of Science, Engineering, and Medicine.By measuring the level of a leading dispersal agent, dioctyl sodium sulfosuccinate, in sea life following the 2010 Deepwater Horizon spill in the Gulf of Mexico, the team was able to establish how long the chemical lingers and what health effects it has on various organisms. The scientists found the risks associated with using DOSS were minimal, the team found that in areas where oil concentrations in water were more than 100 milligrams per liter did increase the toxicity, though they noted oil concentrations are typically much lower than that in most spills. Terry Hazen, the University of Tennessee-Oak Ridge National Laboratory Governor's Chair for Environmental Biotechnology, who is known for his work on the Deepwater Horizon oil spill recovery efforts, co-authored the report. "One of the biggest concerns in cleanup efforts is the effect the spill has on people's health and livelihood," Terry Hazen, University of Tennessee said. "It's not just that oil itself is harmful and potentially even flammable, but you have to be careful what kind of chemicals you expose crews to while trying to clean or contain the oil."
This Legendary Shale Basin Just Broke Its 2011 Production Record -- The Haynesville Shale in northeastern Texas and Louisiana is producing 10.522 billion cubic feet per day of natural gas this month, and is expected to produce even more next month, beating the previous production record of 10.4 billion cu ft/day from back in 2011. According to this this month’s Drilling Productivity Report by the EIA, natural gas production from the Haynesville shale is expected to rise to 10.754 billion cu ft/day in May. Among the key shale plays in the U.S., Haynesville currently ranks third in terms of natural gas production after the Appalachia basin with the Marcellus and Utica shale plays and the Permian region, where associated gas production has been surging alongside booming crude oil production over the past year. Those three regions accounted for almost half of America’s natural gas production in the middle of last year, compared to less than 15 percent of total U.S. natural gas output in 2007, the EIA said in August 2018. Production in the Haynesville region started to rebound in 2017, driven by improving initial production rates and increasing rig counts, the EIA said. The main reason for the resurgence for the Haynesville Shale is its proximity to the U.S. Gulf Coast—home of a growing number of liquefied natural gas (LNG) export terminals. Another driver of Haynesville’s renaissance is the productivity gains achieved in the past decade, according to the EIA. Between 2013 and 2016, production at the Haynesville dropped due to the higher relative production costs compared to the Marcellus, for example, because the Haynesville formation lies at depths of 10,500- 13,500 feet, much deeper than the Marcellus depths of between 4,000 feet and 8,500 feet, the EIA says. As early as in January this year, Rystad Energy said that the Haynesville Shale would soon reach record-high natural gas production levels. “We conclude that Haynesville Shale’s revival, for the second year in a row, looks sustainable. Supported by its proximity to a new LNG export terminal, gas production will continue to grow, and achieving new all-time high gas production levels should happen within a matter of months,” Rystad Energy partner Artem Abramov said.
Cameron LNG Marks Transition - Train 1 of the Cameron LNG project in Hackberry, La., has reached the final commissioning stage, McDermott International, Inc. and joint venture partner Chiyoda International Corp. reported late Monday.According to a written statement emailed to Rigzone, McDermott and Chiyoda have introduced pipeline feed gas into Train 1 of the liquefaction export facility. Representing the transition from construction to startup, the milestone marks the precursor for the production of LNG, McDermott stated.“We are extremely proud of the Cameron LNG project team for this achievement and their remarkable safety performance,” Mark Coscio, McDermott’s senior vice president for North, Central and South America, stated. “Their accomplishment is more than just a project milestone; it is an impressive feat of engineering and construction. Once Train 1 is fully operational, it will have the capacity to produce 4 million tonnes of LNG per year.” McDermott and Chiyoda have provided the engineering, procurement and construction (EPC) for the Cameron LNG project. McDermott’s website states that the scope of work under the approximately $6 billion EPC contract included adding liquefaction and export facilities at the existing LNG regasification complex. The company added that the project includes three liquefaction trains with a projected export of 12 million tonnes per annum, or approximately 1.7 billion cubic feet per day.
U.S. FERC approves two new LNG export terminals in Texas and Louisiana (Reuters) - The U.S. Federal Energy Regulatory Commission (FERC) on Thursday approved construction of two proposed liquefied natural gas (LNG) export terminals, Tellurian Inc’s Driftwood in Louisiana and Sempra Energy’s Port Arthur in Texas. Demand for LNG around the world has exploded, rising by 9.8%to a record high for a fifth consecutive year in 2018, as countries, like China and India, seek cleaner alternatives to burning coal to meet their growing energy needs, according to data from the International Gas Union (IGU). Driftwood and Port Arthur are just two of dozens of LNG export terminals under development in the United States, Canada and Mexico. With so many plants under development, analysts have said that most will likely not be built over the next decade. Tellurian said it planned to make a final investment decision on its $30 billion Driftwood project, which includes pipelines and production fields in addition to the liquefaction plant, in 2019 with first LNG production expected in 2023. Sempra has said it planned to make a final investment decision on Port Arthur around the first quarter of 2020.
FERC approves LNG terminals as anti-fossil protestors scale headquarters - The Federal Energy Regulatory Commission on Thursday approved two liquefied natural gas export facilities as the agency was again beset by protestors calling on it to halt fossil fuel permits and boost renewable energy. Two anti-fossil fuel protestors scaled an awning above the entrance of FERC headquarters in Washington during the early hours of Thursday morning. They unfurled a banner calling on FERC to become the “Federal Renewable Energy Commission.” But later at the agency’s monthly open meeting, regulators approved two large LNG export facilities in a 3-1 vote — the Driftwood terminal in Louisiana and the Port Arthur facility in Texas. Protestors dressed in painting coveralls scaled the FERC building shortly after 6:30 a.m. on Thursday. Credit: Brian Tucker, Industry Dive Democrat Commissioner Cheryl LaFleur crossed the aisle to vote for the export facilities with FERC’s Republican members — just as she did in February, when their compromise on how to consider climate impacts of LNG exports allowed the agency to approve its first terminal in two years. Due to a vacancy on the five-member commission, LaFleur is the swing vote on LNG exports, and has since pushed FERC to expand its climate considerations. In opening comments at the meeting, she said striking climate compromises with the Republican members is getting “harder, not easier.” “Despite my considerable and even growing concerns about the commission’s current approach to analyzing climate impacts in these cases, I’m trying to supplement that analysis myself and decide case-by-case so I don’t become paralyzed into dissenting in every case because I don’t like the way the commission is doing it,” she said. For protestors from the group Beyond Extreme Energy, the approvals represent the commission again kowtowing to fossil fuel interests. The group of mid-Atlantic environmental activists has fought FERC for years over natural gas pipelines, disrupting commission meetings and even blockading FERC’s underground parking garage during one action last year. "It's just locking in fossil fuel infrastructure for the next 40 or 50 years,” Melinda Tuhus, a spokesperson for Beyond Extreme Energy, said of the LNG orders.
LNG Approvals Boost America's Export Outlook-- America is set to become an even bigger player in the global liquefied natural gas market after the nation’s top regulator approved two more projects to export the super-chilled fuel. Tellurian Inc.’s proposed $28 billion Driftwood terminal in Louisiana and Sempra Energy’s Port Arthur LNG project in Texas were cleared by the Federal Energy Regulatory Commission in a 3-1 vote in Washington on Thursday, with Democratic Commissioner Richard Glick dissenting. The approvals followed a breakthrough at the commission, which had been divided 2-2 along partisan lines over how much climate change should be factored into pipeline and LNG projects. That resulted in Venture Global LNG Inc. getting the go-ahead for its $5 billion Calcasieu Pass LNG export terminal in Louisiana in February. Tellurian and Sempra will face fierce competition as global gas supplies soar, however. New terminals in Australia, Russia and Qatar are sending cargoes across the world, and three more U.S. projects may start up by the end of the year, putting the nation on course to challenge Qatar as the second-largest exporter. LNG prices have plunged, calling into question the economics of new plants. ”FERC’s job is not to judge which projects are the most competitive or have the best chances of finding financing,” said Jason Feer, global head of business intelligence at ship broker Poten & Partners Inc. in Houston. “So while you need FERC approval to start construction, you still need to have all of the contracts or financial commitments you need to actually execute the project.” Since the Venture Global approval, U.S. regulators have said LNG projects will be decided on their own merits, and the Democratic commissioners have renewed calls for FERC to pay more attention to greenhouse gas emissions in its deliberations. The commission is short one member following the death of former Republican Chairman Kevin McIntyre in January. Both projects received final environmental impact statements in January. ClearView Energy analysts said the Energy Department may issue LNG export licenses for both proposals over the next few weeks.
U.S. refiners planning major plant overhauls in second quarter (Reuters) - U.S. oil refiners are planning a heavy slate of plant overhauls in the second quarter, with total production this month off 8.5 percent compared with the start of the year, according to data from the U.S. Energy Information Administration. Early spring and winter traditionally are heavy periods for U.S. refinery maintenance. But refiners are planning more upgrades than usual in the first half of 2019 to avoid fall and winter shutdowns as they prepare to meet coming low-sulfur standards. This year’s maintenance schedule and higher crude prices helped push U.S. gasoline prices to a national average of $2.83 a gallon last week, up 26 percent since the start of the year, according to data from the American Automobile Association. U.S. crude futures rose 32 percent in the first quarter. International Maritime Organization (IMO) 2020 is a standard for maritime diesel that takes effect on Jan. 1 and is designed to reduce air pollution. Refiners have been revamping their plants to make IMO 2020 compliant fuel. Most U.S. refiners typically ramp up production of motor fuel during the second quarter to build inventories for the summer driving season. But Bell said an average of 1 million barrels per day (bpd) of crude oil refining capacity could be offline through the second quarter. Work on refiners’ crude distillation units (CDUs) and catalytic crackers helped send volumes down to 15.85 million bpd in the last week of March, from 17.5 million bpd in the first week of January, the EIA said. CDUs generate feedstocks for fuel processing units such as catalytic crackers. Among the refiners scheduling major maintenance this month are Valero Energy Corp and BP Plc. Valero’s Memphis, Tennessee, refinery will shut its 65,000 bpd gasoline producing fluidic catalytic cracking unit for a 60-day overhaul the last week of April. BP is shutting one of two small CDUs at its 413,500 bpd Whiting, Indiana, refinery on Monday for 30 days of work. The Whiting refinery is BP’s largest in North America. Work also is continuing this month on a planned overhaul of the 112,000 bpd gasoline-producing residual catalytic cracking unit at Royal Dutch Shell Plc’s 218,200 bpd Norco, Louisiana, refinery. That unit is expected to restart in the first full week of May.
US Gulf Imports Nosedive After Chemical Fire, Reduced Iraqi Shipments -- The U.S. Gulf Coast imported the least amount of crude in nearly three decades as shipments from Iraq plummeted and congestion lingered on a critical waterway weeks after a blaze and chemical spill at the Intercontinental Terminals Co. tank farm. The Gulf Coast took just 1.4 million barrels a day of crude last week as Iraqi oil imports fell to a trickle of only 5,000 barrels a day, according to weekly preliminary government data. That’s the lowest amount since August 2015 when the OPEC producer shipped nothing its U.S. buyers. The reduced Iraqi shipments caused deliveries from OPEC’s top six suppliers to fall below 1 million barrels a day for the first time in data going back to 2010. ITC’s petroleum and chemical tank farm caught fire mid-March resulting in shipping restrictions on part of the Houston Ship Channel, a critical waterway for the petroleum industry. Two weekends ago, the same channel was shut again because of a severe storm, but it resumed traffic with restrictions the next day. OPEC and its partners have entered into a pact to reduce crude supply in an effort to cut inventories. The group’s de facto leader Saudi Arabia has been targeting the U.S. for most its cuts, even sending Saudi Aramco-owned Motiva Enterprises LLC no crude in January. That may change if President Trump has called for more supply because of rising international crude prices.
Recent chemical fires spur safety concerns – video - CNBC’s Brian Sullivan reports from Crosby, Texas, on recent major chemical fires and the growing concern over safety following deregulation.
Soaring Permian Output To Cap Oil Rally - The U.S. crude oil production juggernaut continues to move forward. In 2018, U.S. production increased 17 percent over the previous year in a dynamic that is impacting both geopolitics as well as setting a new course for American global diplomacy. Annual U.S. crude oil production reached a record level of 10.96 million barrels per day (b/d) in 2018, 1.6 million b/d higher than 2017 levels. In December 2018, monthly U.S. crude oil production reached 11.96 million b/d, the highest monthly level of crude oil production in U.S. history, the EIA said on Tuesday. Moreover, U.S. crude oil production has increased significantly over the past 10 years, driven mainly by production from tight rock formations using horizontal drilling and hydraulic fracturing, hence the U.S. shale oil revolution. The EIA now projects that U.S. crude oil production will continue to grow this year and in 2020, averaging 12.3 million b/d and 13.0 million b/d, respectively. Not surprisingly, Texas is still leading U.S. production, similar to the lead it took up to the 1970s when the state was largely responsible for allowing the U.S. to play the then-role of global oil markets swing producer before ceding that role to a Saudi Arabia-led OPEC for the next four decades. Texas accounted for 40 percent of the national total oil production last year. Crude oil production in Texas averaged 4.4 million b/d in 2018 and reached a record-high monthly production level of 4.9 million b/d in December. Texas’s 2018 annual production increased almost 950,000 b/d. This growth has been largely driven by output in the Permian region in west Texas. For its part, Permian production represented nearly 60 percent of the total increase in overall U.S. oil output last year. Oil production increases in the Permian region, which spans parts of Texas and New Mexico, also drove a 215,000 b/d, or 45 percent production increase in New Mexico in 2018. This level was the second-largest state-level growth in 2018 and accounted for 13 percent of the total U.S. increase, setting a new annual record production level in New Mexico.
Beta Crude Gathering System To Help Permian's Midland Basin Grow -- The rapid development of the Permian’s vast hydrocarbon resources that we expect will continue through the 2020s and beyond can’t happen if there’s insufficient gathering-pipeline infrastructure in place to transport crude from well sites to takeaway pipelines. Similarly, the favorable pricing that Permian producers hope to receive for their crude oil is possible only if their gathering systems are interconnected to two or more long-haul, big-bore pipelines that offer them some serious destination optionality. The need for new gathering pipes with multiple links to Gulf Coast- and Cushing-bound takeaway pipes is the driving force behind the Beta Crude Connector, a planned 100-mile-plus pipeline network in the heart of the Permian’s Midland Basin that was unveiled on Monday (April 15) by a joint venture of Concho Resources and gathering specialist Frontier Energy Services. Today, we kick off a new blog series on crude-gathering projects in the Permian with a look at the Concho/Frontier plan. Gathering pipelines play a critically important — but often overlooked — role in the midstream sector. These hydra-like systems, with a number of small-diameter-pipe “tentacles” feeding larger-bore pipes downstream, provide the most cost-effective means of transporting crude oil from the lease to storage and to takeaway pipelines. The rapid development of new, high-intensity production areas like the Permian’s Delaware and Midland basins depends on well-planned gathering systems; relying only on trucks to haul crude to long-haul pipelines would slow development of these areas to a crawl. As we said in our Hot Legs blog series a couple of years ago, there’s been a fierce battle on to build new gathering pipelines in the Permian, and midstream companies better bring their A game. Why? Because successfully developing these systems requires a keen understanding of three key factors: lining up producer commitments, providing takeaway optionality, and minimizing the total cost of moving crude from the lease to the Gulf Coast, Cushing or other destinations. Takeaway optionality is particularly important. Producers want to get the highest possible price per barrel, and the best way to do that is to have access to the destination that offers the best price at a given moment.
Argus launches new crude price reflecting shifting Permian crude quality - Global energy and commodity price reporting agency Argus today launches a new light crude price assessment to reflect growing light oil production in the Permian basin of west Texas and New Mexico. The new West Texas Light (WTL) price, published daily in the Argus Crude report, is for Permian basin crude with a gravity of 44.1-49.9°API traded at terminals in Midland, Texas.Midland is the chief gathering hub for Permian basin crude, the fastest growing source of oil in the world. An increasing share of Permian crude is lighter than 44°API, and midstream companies have created the WTL stream to separate lighter crude from the denser main Permian WTI grade, which is typically at 40-44°API.Much WTL trade is taking place at differentials to Argus’ benchmark WTI Midland price, which is assessed at terminals in Midland, Texas. Argus will publish its new WTL price assessment as a differential to WTI Cushing as well as an outright number.WTL has also begun to trade at Houston at a differential to the benchmark Argus WTI Houston price, which is widely used to price US exports. Argus WTI Houston, which is assessed at Magellan’s MEH terminal, is also the settlement price for derivatives contracts on the Ice and CME exchanges, where open interest currently stands at 200mn bl with daily trading volumes topping 10mn bl. Argus intends to publish a separate WTL Houston index as volumes grow. “Argus WTI Houston and Argus WTI Midland are two of the most liquid and transparent physical spot crude price indexes in the world. We expect to see the liquidity of the WTL market at Midland and later at Houston grow rapidly as well.”
Permian Basin water disposal volumes expected to double by 2022 - Oilfield wastewater disposal volumes are expected to double in the Permian Basin within the next two to three years, a new analysis from global energy intelligence firm Wood Mackenzie shows. As drilling activity continues to expand in the arid region between West Texas and southeastern New Mexico, hydraulic fracturing has resulted in growing challenges in sourcing water and what to do with wastewater from completed wells. Wastewater disposal costs can account for a third of total lease operating expenses in the Permian Basin, Wood Mackenzie Director of Upstream Consulting Matthias Bloennigen said in a statement. "Even with 100 percent water reuse for further completions, which is unlikely, the current saltwater disposal infrastructure is expected to hit capacity in the near future," Bloennigen said. "As Permian operators continue to focus on boosting production output, they will need to develop and refine their water strategies." While exploration and production companies scramble to avoid bottlenecks and well shut-ins, water midstream companies are providing various solutions as the water management challenges grow. More than a dozen water-related infrastructure deals have taken place in the Permian over the last three years, and the pace of transactions is expected to pick up considerably in 2019. "We've seen a lot of interest from private equity, as there's still a huge need for water infrastructure," Bloennigen said. With more than 460 drilling rigs in operation in the Permian Basin, the arid region accounts for nearly half of the exploration and production activity in the United States. Some 246 operators have filed more than 2,400 drilling permits for projects on the Texas side of the Permian Basin, accounting for nearly two-third of drilling permits in the Lone Star State, Railroad Commission of Texas show.
The Largest Challenge to Permian Field Development - From sourcing to disposal, water is becoming the largest challenge to field development in the Permian Basin. That’s according to energy research and consultancy company Wood Mackenzie (WoodMac), which made the statement in a recent post published on its website. In the post, WoodMac said failure to address these issues could increase costs, “with potential consequences as severe as well shut-ins”. “The number of completed Permian wells continues to increase, and water disposal volumes are forecast to double by 2022,” WoodMac said in the statement. “This produces increasingly large volumes of water. Even with 100 percent water re-use for completions, which is unlikely, the current salt water disposal infrastructure is expected to hit capacity in the near future. Additionally, increased water trucking has created traffic jams and damaged roads,” WoodMac added. “Water disposal costs can account for a third of total lease operating expenses in the Permian. Producers simply cannot afford to cut corners on water management,” WoodMac continued. In the post, WoodMac stated that the water midstream space is “ripe” for mergers and acquisitions and revealed that it expects the pace of water-related infrastructure deals in the Permian to “pick up considerably” in 2019. “The water midstream space is screaming out for capital in the Permian. The infrastructure business is in its early stages of development and offers numerous possibilities for revenue streams,” WoodMac said. Back in January,Rystad Energy revealed that demand for frac water in the Permian exceeded the total U.S. demand of 2016. The company forecasted at the time that water demand in the Permian will likely surpass 2.5 billion barrels by 2020. Earlier this week the U.S. Energy Information Administration forecasted that oil and gas production in the Permian would hit 4.13 million barrels and 14.11 billion cubic feet per day in May, respectively.
US Drops 10 Oil and Gas Rigs -- This week's rig count saw declines of eight oil rigs and two gas rigs for a net loss of 10. The U.S. dropped a total of 10 rigs this week, according to weekly data released today from Baker Hughes, a GE Company. This is the second consecutive week that the U.S. rig count has declined. This week’s count saw declines of eight oil rigs and two gas rigs for a net loss of 10. All 10 rigs lost were onshore. No states added rigs this week, but the following states lost rigs: •Louisiana (-2) •Oklahoma (-2) •Texas (-2) •Wyoming (-2) •Alaska (-1) •Colorado (-1). Among the major basins, all rig counts remained flat, except for the Haynesville – which lost two rigs – and the DJ-Niobrara, Mississippian and Permian – all of which declined by one rig. The Permian currently has 463 active rigs, which accounts for almost half of the U.S.’ onshore rigs. The nation’s overall rig count is currently 1,012. This is one rig less than the count one year ago.
U.S. shale producers see rising ultralight crude output hitting pricing (Reuters) - Much of the new crude coming from the top U.S. shale field is so light that it is starting to affect pricing for the region’s oil, producers attending an energy conference this week said. Permian producers generally sell their crude at WTI benchmark prices, but rising supplies of ultralight oil may require them to offer $1 to $2 a barrel discounts to refiners requiring heavier grades, some said. Newer production coming from the Permian Basin in West Texas and New Mexico has API gravity in the low 50s degrees, compared to 40 to 44 degrees for West Texas Intermediate. Refiners on the U.S. Gulf Coast, whose plants are geared to run heavier crudes, are having to pay higher prices for those supplies because of slowing output and transport problems at heavy-oil producers Venezuela, Mexico and Canada. Whether buyers increasingly demand a discount for Permian oil “just depends on how much everyone keeps growing the lighter production, and the vast majority of the growth is in lighter crude,” Rob MacAskie, finance chief at Zarvona Energy LLC, said in an interview at a Hart Energy conference in Fort Worth. Zarvona has been selling its oil, most of which has a gravity of 38-42 degrees, at WTI pricing, he said. The U.S. benchmark generally is classified as 44.1-49.9 degrees. Price reporting agency Argus Media last week launched a daily WTL price assessment based on trading at Midland, Texas, the heart of the Permian Basin. The discount for that lighter crude is running between $1 and $2 a barrel, said Allen May, executive vice president at Scala Energy LLC. Colgate Energy LLC, another Permian producer, has had its output blended with heavier West Texas grades, insulating it from potential pricing pressure, said Will Hickey, the company’s co-CEO. “The whole world is scared of this really high API. We haven’t seen it (price pressure) yet but it’s something that could happen, he said. “You’re at the mercy of what your acreage produces,” said Hickey.
Trump uses energy orders as political weapon in Texas - President Trump appeared last week in Crosby, Texas, to sign executive orders aimed at boosting the oil and gas sector at a union traditionally loyal to the Democratic Party. Those hard hat-donning onlookers and the manufacturing setting were no accident. Trump is aiming to drive a wedge between union members and the Democratic Party on energy at a time when the state's demographics are changing, so much so that the Lone Star State is no longer quite the shoo-in it has been for the Republican Party. "Trump gets to show union workers he is delivering," said Joe Barton, a former Texas Republican congressman who successfully limited federal oversight of hydraulic fracturing, helping spur the country's shale revolution. It's a message that Trump is also delivering in other swing states. Yesterday in a Minnesota speech at a trucking company, Trump said, "For some reason, Democrats don't like pipelines." The president delivered the executive actions in Texas before a crowd gathered at a training center for the International Union of Operating Engineers, an organization that has more than 400,000 members who have greatly benefited from the oil and gas boom in the U.S. in the past decade. "We've ended the war on American energy," Trump told a few hundred heavy-machine workers. "We put thousands and thousands of patriotic union members like you to work, building our energy future. Since the election, we created more than 5.5 million new jobs and more than 60,000 oil and gas construction jobs."
Chevron bid shows there is no place like home for US oil - Anyone who wants to understand how big oil views the energy market should take a close look at the $50bn bid by Chevron for the US company Anadarko, announced on Friday. The deal is based on three important assumptions. The first is that oil is here to stay. Peak oil — meaning peak demand — is still a long way off and is unlikely to be reached before 2030. Electric vehicles get all the attention but the number of cars and other light vehicles with internal combustion engines is still between 97 and 98 per cent of the global market. Even when oil demand peaks there should be no presumption that it will be followed by a sudden fall. A plateau is much more likely. Electric vehicles will win a share of the market but the growth areas of freight transport and aviation are still secure, almost completely unchallenged markets for oil. So is the petrochemicals business. A plateau of 100m barrels a day is the most likely outcome and that means that there is still a strong need for oil resources to be found and developed. Second, the industry is starting to realise that it has put too much emphasis on gas in recent years and not enough on oil. Natural gas demand has been strong and that has encouraged heavy investment in new gas developments. Chevron itself has invested heavily in gas in recent years — notably in a series of expensive large-scale projects in Australia. The nagging worry is that natural gas supply will outweigh demand as low-cost renewables, backed by public policies designed to reduce emissions, begin to penetrate electricity markets across the world. The demand for gas for use in power generation has driven recent growth but as the electricity market becomes more competitive gas will be increasingly vulnerable to the onward march of renewables. In the medium term, oil begins to appear a better bet. But the challenge, and the third and crucial message from the Chevron bid is that of access to the resources needed to sustain a large oil business. The challenge is compounded by the need to find supplies which can be developed at a low cost which will be resilient to any further fall in prices. There is no physical shortage of oil across the world but there are high political barriers to investment. The oil reserves of the Middle East remain largely closed to international investment because of state ownership (Saudi Arabia), or sanctions (Iran) or physical risks (Libya). Russia is off limits because of US sanctions legislation, Nigeria is still mired in corruption and Venezuela is trapped in its own political conflict. Much easier then to focus on the resources available at home. If you have to pay a premium so be it.
Investors are placing buyout bets on oil drillers after Chevron-Anadarko deal -- Chevron’s $33 billion deal to buy Anadarko Petroleum is having a halo effect for U.S. oil drillers, as investors place bets on the next acquisition target in the U.S. shale oil space.Shares of drillers with positions in the Permian Basin are on the rise following the deal, the sixth biggest on record in the oil and gas sector by enterprise value. The Permian Basin, which stretches across western Texas and southeastern New Mexico, is the center of a renaissance in U.S. oil and gas drilling.Chevron’s tie-up with Anadarko isn’t just about stitching together their Permian acreage, but the opportunity was a driving force in the deal.Many of the shale space’s biggest gainers since the deal are drillers that focus exclusively on the Permian.Paul Sankey, oil equity analyst at Mizuho Securities, said that makes sense. He believes future consolidation will be driven by efforts to more efficiently develop Permian acreage.Drillers can do that by stringing together big strips of land that make it more cost-effective to execute the advanced drilling methods necessary to extract oil from shale rock formations. Following the deal, Chevron boasted that the combined company would have a 75-mile-wide corridor in a sweet spot of the Permian.“As a consequence, expect focus to be on complementary acreage position, which helps explain the recent performance of the Permian pure-plays following the CVX-APC news — a single basin operator seems a lot simpler to integrate into an existing position,” Sankey said in research note Wednesday.
Chevron's Anadarko deal to pressure U.S. shale producers to explore sales (Reuters) - Oil major Chevron Corp’s $33 billion deal on Friday to acquire Anadarko Petroleum Corp has some investors and industry executives asking whether it is time for other U.S. shale oil and gas producers to consider selling themselves. Anadarko has been one of the pioneers of the shale revolution, which turned the United States into the world’s biggest oil producer, overtaking Russia and Saudi Arabia. The Houston-based company’s willingness to ink a sale, rather than capitalize on oil prices rebounding, illustrates the significant challenges facing many U.S. shale producers. These challenges include exploration and production becoming more expensive, as the oil and gas that is easier to access gets scarcer and existing wells turn less productive. Deep-pocketed oil majors such as Chevron can better cope with these costs, because they can get cheaper drilling rates by committing to longer contacts and afford cutting-edge technology to get more out of wells. Shale producers such as Pioneer Natural Resources, Continental Resources, Diamondback Energy and Concho Resources have already been under pressure from investors to improve their profitability. Many investors now say Chevron’s deal will embolden them to grill companies in the sector whether it is time to throw in the towel and sell. “If you have large acreage positions like Pioneer and Concho, or lesser but more contiguous positions like Parsley Energy, and you’re a pure-play Permian producer, there’s no doubt that you are on the radar screen for these majors,” said Rob Thummel, portfolio manager at Tortoise Capital Advisors. Pioneer, Concho and Parsley shares rose 11.5 percent, 8.8 percent and 11.7 percent respectively on Friday following the announcement of the sale of Anadarko, amid investor speculation over who the next takeover target will be.
Chevron and Exxon Say They Can Turn Around the Failed Finances of Fracking Industry -- After a decade of the American fracking industry burning through hundreds of billions of dollars more than it earned, this industry previously dominated by shale drilling specialists is entering a new phase. The oil majors — a group of multinational companies that typically have divisions throughout the oil supply chain — now are investing heavily in fracked oil and gas operations. The latest development is Chevron acquiring shale oil and gas company Anadarko for $33 billion. One of Chevron’s current “human energy” ads uses the catchphrase “We do difficult.” Which is good for Chevron if the oil major hopes to profit off this investment, because making money on U.S.shale oil has proven very difficult for the current players. Why would major oil companies choose to invest in an industry that has failed to turn profits in the past decade? It helps to consider the state of the broader oil and gas industry. Oil producers working in Canadian tar sands have been losing money for years, a trend that continues. The natural gas industry in Canada is in even worse shape. In the U.S., natural gas prices are so low that in areas flush with it like the Permian Shale in Texas, gas is selling for negative amounts — meaning gas producers have to pay someone to take it. Norway’s state-owned investment fund — an international leader with approximately a trillion dollars under management — recently announced its divestment from U.S. shale oil and Canadian tar sands oil companies. Chevron CEO Mike Wirth recently told investors of the shale decision, “There’s nothing we can invest in that delivers higher rates of return.” To put that in perspective, Reuters recently concluded, “U.S.shale producers last year again spent more money than they collected.” Chevron’s top executive says the company’s best investment option is a business model that consistently has delivered negative returns. Not to be outdone, ExxonMobil is also making a big move into U.S. shale, with plans focused on the Permian Basin in Texas and New Mexico. As DeSmog reported, Exxon is selling the idea that a partnership with Microsoft and the use of cloud computing will help it unlock the secret to profits in the Permian. Chevron also has stated it doesn’t expect to make money on shale oil production in 2019 but that should change in 2020. The refrain of “we’ll make money next year” is one constant in the shale oil industry.
Sur de Texas nat gas pipeline seen starting by June - TransCanada and IEnova's Sur de Texas-Tuxpan pipeline to add U.S. natural gas export capacity to Mexico should come online by the end of June, a Mexican government official says. The texas-to-Mexico pipeline had been expected to come online by mid-February but technical and other problems have delayed the project by more than a year. Sur de Texas will connect with Enbridge's 2.6B cf/day Valley Crossing pipeline; once the entire pipeline system comes online, it will comprise the largest cross-border gas pipeline by volume.
A creek flowing to the Colorado River turned black. Now the state has sued the alleged polluter. - — For more than two months, the waters of Skull Creek have flowed black, its surface covered in an iridescent sheen. Yellowed fish skeletons line the pebbled banks of the Colorado River tributary, and a dizzying chemical odor hangs in the air. The odor is so strong that Julie Schmidt says she can smell it inside her house. She and her husband bought 10 acres along the creek in December with visions of an idyllic country upbringing for their children, ages 10 and 2. Now, she isn't sure they should play outside. “Last summer, you could go into the creek behind the house and it was crystal clear. You could play in it, you could fish,” said Schmidt, who moved from nearby Garwood and has lived in Colorado County her entire life. “Now you don’t want to touch it. You pick up a rock, turn it upside down, and it’s completely black.” Locals and elected officials in this small southeast Texas community near the intersection of Interstate 10 and Texas 71 say the source of the problem is obvious: an oil and gas waste recycling facility near the creek that is owned by Columbus-based Inland Environmental and Remediation. Although Inland has denied wrongdoing, the Texas attorney general sued the company Friday — 10 weeks after citizens first began complaining — alleging the company illegally discharged industrial waste into the creek and stored that waste without a permit. On Friday, a state district court in Travis County granted a temporary restraining order against the company and its president, David Polston, saying he must “cease and prevent all discharges of waste” from the site into state waters. The state’s lawsuit seeks monetary damages of up to $1 million.
Environmental group IDs New Mexico methane emissions surge -- — A prominent environmental group announced new evidence Thursday that methane emissions in New Mexico are climbing amid a surge in oil and natural gas production in the Permian Basin drilling zone that straddles the state boundary with Texas.The analysis from the Environmental Defense Fund estimates that statewide emissions at oil and natural gas production sites of the potent heat-trapping gas linked to global warming are five times higher than what is reported to the U.S. Environmental Protection Agency. The EPA tracks emissions by large petroleum producers.Defense Fund scientist David Lyon said the analysis incorporates methane sensor measurements from about 90 locations in the Permian Basin of New Mexico and Texas in mid-2018. That monitoring was done by a research team from the University of Wyoming.“The Permian Basin has become the pre-eminent, most active drilling basin of anywhere in the country,” said Jon Goldstein, director of regulatory and legislative affairs for the Environmental Defense Fund. “We wondered, ‘What is that doing to statewide methane emissions?’ ”The new analysis estimates annual methane emissions of just over a million metric tons (1.1 million U.S. tons) linked to oil and natural gas facilities including well pads, compression stations and pipelines — with the majority of emissions emanating from southeastern New Mexico.A prior study by the Environmental Defense Fund based on 2015 data documented emission of about 570,000 annual metric tons across New Mexico. Industry officials said that producers are already taking steps to capture more of the methane because of economic incentives, while Goldstein says that drillers who target oil do not always stand to profit when natural gas emerges.
Indigenous leaders want less drilling near sacred sites (AP) — Leaders of the Navajo Nation and Pueblo tribes expressed frustration Monday with federal oversight of oil and gas leases on public holdings near ancient Native American cultural sites and endorsed legislation to restrict natural gas development around Chaco Culture National Historic Park. Acoma Pueblo tribal Gov. Brian Vallo told members of the House Subcommittee on Energy and Mineral Resources at a hearing in New Mexico that not enough is being done to safeguard sacred sites scattered beyond the national park at Chaco Canyon. Many of the sites involve more than just physical features that can be surveyed by archaeologists, he said, referring to the less tangible aspects of Chaco. “Only we can identify these resources,” he said. Lawmakers including U.S. Rep. Raul Grijalva of Arizona and New Mexico’s Debra Haaland and Ben Ray Luján said they were profoundly moved by a visit Sunday to ancient Chaco dwellings and nearby industrial sites where they used infrared camera technology to view methane escaping into the atmosphere. “You could see the plumes coming out and moving across the sky,” Luján said. “There’s no question that this is occurring.” The House committee was exploring the possible impacts of air pollution on sacred sites. They also quizzed New Mexico Gov. Michelle Lujan Grisham on her administration’s push to contain emissions of methane through stricter local regulation. New Mexico’s all-Democratic House delegation is seeking to halt new oil and natural gas lease sales on federal holdings within a 10-mile (16-kilometer) buffer zone around Chaco Culture National Historic Park.
Sen. Elizabeth Warren says she'd ban new fossil fuel production on public lands as president -Sen. Elizabeth Warren said Monday that she would immediately move to place a “total moratorium” on new federal fossil fuel leases if elected president, blocking energy companies from drilling offshore and producing oil, gas and coal from U.S. government-owned land. The Massachusetts Democrat and 2020 contender said she would prioritize building new renewable energy projects. Warren said her administration would set a goal of producing 10 percent of the nation’s electric power from wind towers, solar farms, and other clean energy projects constructed offshore or on public lands. Warren revealed the proposal in a blog post on Medium that laid out her plans for managing the public parks and vast swaths of land that the federal government manages. She said it would form part of her strategy for addressing climate change. “It is wrong to prioritize corporate profits over the health and safety of our local communities,” she wrote. “And it’s not enough to end our public lands’ contribution to climate change. We have an enormous opportunity to make them a part of the climate solution, and for both economic and environmental reasons, we should take it.” Warren said she would also reinstate an Obama-era rule to prevent methane — a potent greenhouse gas — from escaping into the atmosphere from oil and gas operations on federal land. The policy would mark a dramatic reversal from President Donald Trump’s position. Trump has sought to increase drilling on public lands and open virtually all federal offshore areas to oil and gas exploration. The Trump administration has overseen the rollback of dozens of environmental and energy regulations, including the methane rule. Warren’s plan goes further than measures taken by the Obama administration. President Barack Obama placed a moratorium on federal coal leasing — though not on oil and gas production — and sought to indefinitely block offshore drilling in the Arctic Ocean and parts of the Atlantic. Permitting for onshore oil and gas drilling was up nearly 40% in 2018, due in large part to expanded use of automated systems set in motion under Obama, according to a Reuters analysis. In 2018, the Interior Department’s Bureau of Land Management generated $1.1 billion in onshore oil and gas lease sales, nearly three times the previous annual record set in 2008.
What Warren's leasing moratorium would mean for CO2 - Climate activists have long called for an end to leasing federal lands for fossil fuel development. Now, they can count a 2020 presidential candidate among their number.Sen. Elizabeth Warren, a Massachusetts Democrat, saidyesterday that she would sign an executive order on her first day in the White House to end new leases for fossil fuel development on federal land. Doing so would result in significant carbon reductions over time, analysts say. Nearly a quarter of U.S. emissions stem from energy production on federal land. In a 2018 paper, researchers at the Stockholm Environment Institute estimated that putting a stop on new leases would reduce carbon emissions by 280 million tons in 2030, or about 4% of total U.S. emissions."Given the climate imperative, there is a lot of reasons not to be extracting fossil fuels from public lands," said Peter Erickson, a senior scientist at the institute and the paper's author. "We don't need those fossil fuels for our energy supply."But whether Warren's plan is legal is up for debate. While federal law rests considerable discretion with the Interior secretary to make decisions over leasing, it also calls for quarterly lease auctions.Kathleen Sgamma, president of the Western Energy Alliance, which represents oil and gas interests, called Warren's plan "not a serious proposal.""Congress has specifically mandated oil and natural gas development on appropriate public lands, and an executive order cannot undo law that has been in place for decades," Sgamma said. "Her premise about development damaging public lands is completely false, coming from her complete inexperience with public lands issues."
Bernie Sanders ‘Raises the Bar Even Further’ on Climate With Vow to Ban Fracking, All New Fossil Fuel Projects - Bernie Sanders won praise from environmental groups after releasing a climate platform that calls for a complete ban on fracking, a moratorium on all new fossil fuel infrastructure, an end to oil exports, and a Green New Deal."Climate change is the single greatest threat facing our planet," the Vermont senator and 2020 contender wrote on the climate page of his website, which was unveiled this week. If elected president, Sanders said, his administration will work to:
- Pass a Green New Deal to save American families money and generate millions of jobs by transforming our energy system away from fossil fuels to 100 percent energy efficiency and sustainable energy. A Green New Deal will protect workers and the communities in which they live to ensure a transition to family-sustaining wage, union jobs.
- Invest in infrastructure and programs to protect the frontline communities most vulnerable to extreme climate impacts like wildfires, sea level rise, drought, floods, and extreme weather like hurricanes.
- Reduce carbon pollution emissions from our transportation system by building out high-speed passenger rail, electric vehicles, and public transit.
- Ban fracking and new fossil fuel infrastructure and keep oil, gas, and coal in the ground by banning fossil fuel leases on public lands.
- End exports of coal, natural gas, and crude oil.
Sanders' climate platform comes just days after fellow 2020 hopeful Sen. Elizabeth Warren (D-Mass.) vowed that her administration would ban fossil fuel drilling offshore and on public lands on day one. Environmentalists celebrated the senators' bold climate positions and urged other 2020 contenders to follow suit.
Industry-Threatening Colorado Bill Signed into Law -- Colorado Governor Jared Polis has signed Senate Bill 181 into law. In a statement posted on social media site Twitter, Polis said he was “proud” to stand alongside bipartisan elected officials, environmental organizations and the oil and gas industry to sign the bill. Commenting on the development, Colorado Petroleum Council (CPC) Spokesman Ben Marter said, “Governor Polis’ signature makes Senate Bill 181 law, which fundamentally alters the natural gas and oil industry’s future in the State of Colorado”.“From the introduction of the measure early last month, our industry vigorously opposed the policy and the process. Senate Bill 181 remains a threat to one of the foundations of Colorado’s economy,” he added. “We are appreciative that legislative leaders heard our concerns and worked with us to begin to address them. Colorado’s energy future is too important to be wielded as a partisan weapon, and all Coloradans deserve to know the consequences of this bill, both intended and unintended,” Marter continued. The CPC representative said that while Senate Bill 181 remains “deeply flawed”, Governor Polis and state officials have pledged to work with industry to create “a reasonable regulatory framework that works for all Coloradans”. In an organization statement posted on its website last month, the American Petroleum Institute said Senate Bill 181 would “at the very least hinder, if not prohibit” energy development in Colorado, “directly threatening hundreds of thousands of jobs, billions of dollars of state revenue and hundreds of millions in education funding”.
Gov. Jared Polis ushers in new era of drilling regulation, but are “oil and gas wars” over? - Erin Martinez was at a news conference in February when Colorado legislative leaders and Gov. Jared Polis announced a bill that would make sweeping changes to how oil and gas are regulated. And she and her family had a front-row seat as Polis signed the bill into law Tuesday. The bill was signed into law a day before the second anniversary of the house explosion that killed her husband, Mark Martinez, and brother, Joey Irwin. The explosion, which severely burned Martinez, was caused by an uncapped, cut flow line that was still attached to a well and leaked odorless methane and propane into the house. The new law requires increased monitoring of flow lines and public disclosure of information about them. “We’re really happy. This is something that means a lot to our family,” said Martinez, whose son and daughter sat with her to see the bill signed. “It feels like it’s a great way to honor Mark and Joey. The two-year anniversary is tomorrow so it’s really fitting that we got this done before that came.” As he prepared to sign the bill, Polis said he hoped the new law will end the conflicts over the drilling that has increased in more populated areas. “Today, with the signing of this bill, it is our hope that the oil and gas wars that have enveloped our state are over and the winner is all of us,” Polis said. The bill makes protecting public health and safety and the environment a priority when considering oil and gas projects. The Colorado Oil and Gas Conservation Commission, the main regulatory body, would no longer be charged with fostering development. RELATED: Colorado regulators prepare to hit the ground running when oil and gas bill becomes law It also allows cities and counties to regulate oil and gas development under their planning and land-use powers, something communities have requested as drilling has increased in and near the growing cities and counties north and east of Denver.
Appeals court weighs Trump permit for Keystone XL pipeline (AP) — U.S. Justice Department attorneys want an appeals court to let construction proceed on the Keystone XL oil pipeline from Canada. But opponents say President Donald Trump is trying to skirt the law by issuing a new permit for the project. The Trump administration has asked the 9th U.S. Circuit Court of Appeals to reverse a lower court ruling that blocked construction of the $8 billion pipeline. Government attorneys say the November ruling that more environmental study was needed is now meaningless. That’s because Trump issued a new permit to developer TransCanada in March. In a legal filing late Wednesday, environmental groups asked the appeals court to keep construction blocked. Legal experts say the case is another test of Trump’s use of presidential power to get his way.
Canada's Oil Patch Divided on Nixing Crude-by-rail Plan -- Alberta Premier-Elect Jason Kenney’s vow to cancel his predecessor’s C$3.7 billion ($2.8 billion) plan to increase the province’s crude-by-rail capacity is dividing Canada’s oil industry, with even one of his supporters saying he should keep the program. Kenney, whose United Conservative Party won a majority of legislative seats in the province’s election on Tuesday, argued on the campaign trail that taxpayer money shouldn’t be spent on the plan to alleviate a lack of pipelines. That stance is backed Brian Schmidt, the chief executive officer of Alberta oil and gas company Tamarack Valley Energy Ltd. Schmidt said he’s opposed to any government intervention in the oil market and that a widening discount for Canadian heavy crude compared with U.S. prices would spur companies to action. "As soon as there’s enough differential, the market will build those cars,” Schmidt said in an interview on the sidelines of a Canadian energy conference in Toronto. “I’m not sure it’s necessary to do public funding.” However, other Albertan oil producers are more supportive of the rail plan, introduced by Premier Rachel Notley last year. MEG Energy Corp. CEO Derek Evans said the investment is “a critical piece of the short-term strategy to solve the egress problem.” “Do I believe the province should be in the rail business in the long term? No,” Evans said in an interview. “That is a producer responsibility in the long term, but the government is required to act in the best interest of the constituents in the province, and that’s exactly the right thing to be doing at this time.” Grant Fagerheim, the CEO of Whitecap Resources Inc. and a Kenney supporter, said the premier-elect may maintain the program temporarily because it’s needed in the short term. However, new pipelines should come online before the program is scheduled to end, and keeping it beyond that point may distort the market for Canadian crude, he said. Whether any of Kenney’s planned changes actually increase investor interest in Canada’s energy industry remains to be seen. ARC Energy Research Institute Senior Director Jackie Forrest said Tuesday before the election results were released that the institutional investors from outside of Canada that she talks to don’t follow the country’s politics too much. She said she gets more questions on pipelines than anything else.
California Water Board Finds Oil-industry Contaminants in Water Wells — Oil-industry pollutants were present in water-supply wells in Kern County, according to a new report released by the State Water Resources Control Board. Chemicals detected at elevated levels include arsenic, barium and boron. The report also showed a recent increase in hydraulic fracturing (“fracking”) near protected groundwater in California. The report’s preliminary results were part of groundwater monitoring mandated by California Senate Bill 4 to determine the effects of fracking on groundwater. Though the report is unclear on whether the detected pollutants are from fracking operations, there were “multiple lines of geochemical evidence” showing oil-industry contaminants have co-mingled with nearby sources of protected groundwater. The water board stated that pollution is “expected” given how close water wells are to oil and gas activities. It also deemed it “likely” that unlined oil-industry wastewater pits caused some of the water pollution. California is the only state with significant oil production that allows wastewater to be dumped into unlined pits, and independent scientists have called for the state to phase out this practice. The regional water boards still allow toxic wastewater discharges to continue at hundreds of wastewater pits. The report also disclosed that fracking has increased in areas with protected groundwater. In 2017 oil companies submitted 12 proposed groundwater monitoring plans that, if approved, would allow fracking near valuable groundwater resources. In 2018 that number doubled to 24. Fracking and oil-waste fluids can contain high levels of benzene and other cancer-causing chemicals. A 2015 study from the California Council on Science and Technology concluded that fracking in California happens at unusually shallow depths, dangerously close to underground drinking water supplies, with unusually high concentrations of dangerous contaminants. The study also concluded that groundwater monitoring alone is inadequate to protect water and that shallow fracking should be prohibited unless it can be proven safe.
The U.S. exported 2 million barrels per day of crude oil in 2018 to 42 destinations --In 2018, U.S. exports of crude oil rose to 2.0 million barrels per day (b/d), nearly double the 1.2 million b/d rate in 2017. Export volumes by destination changed significantly during the year, as U.S. crude oil exports to China fell and exports to other destinations such as South Korea, Taiwan, and Canada increased. The increase in U.S. crude oil exports was the result of increasing U.S. crude oil production and infrastructure changes. U.S. crude oil production increased 17% to 10.9 million b/d in 2018, with U.S. Gulf Coast states—the departure point for more than 90% of U.S. crude oil exports—producing 7.1 million b/d. The increased production is mostly of light, sweet crude oils, but U.S. Gulf Coast refineries are configured mostly to process heavy, sour crude oils. This increasing production and mismatch between crude oil type and refinery configuration causes more of U.S. crude oil production to be exported.In early 2018, the Louisiana Offshore Oil Port (LOOP) in the Gulf of Mexico was modified to enable the loading of vessels for crude oil exports. .In 2018, Asia was the largest regional destination for U.S. crude oil exports, followed by Europe, while, as in previous years, Canada was the largest single destination for U.S. crude oil exports. Canada received 378,000 b/d of U.S. crude oil exports, representing 19% of total U.S. crude oil exports in 2018. South Korea surpassed China to become the second-largest destination for U.S. crude oil exports in 2018, receiving 236,000 b/d compared with China’s 228,000 b/d. In the first half of 2018, the United States exported 376,000 b/d of crude oil to China, which made China the largest single destination for U.S. crude oil exports for that period. However, in August, September, and October of 2018, the United States exported no crude oil to China. U.S. crude oil exports to China resumed in the final two months of the year but at much lower volumes. On average, the United States exported 83,000 b/d of crude oil to China in the second half of 2018. In the summer of 2018, as part of ongoing trade negotiations between the United States and China, China temporarily included U.S. crude oil on a list of goods potentially subject to an increase in import tariffs. Around that time, the difference between the international crude oil benchmark Brent and the U.S. domestic price West Texas Intermediate (WTI) futures prices narrowed: Brent prices went from $9 per barrel (b) higher than WTI in June to $6/b higher than WTI in July. The rapidly narrowing price discount of U.S. crude oils versus international crude oils and the potential for higher import tariffs caused China’s imports of U.S. crude oil to slow. As U.S. crude oil exports to China fell, exports to South Korea, Taiwan, Canada, and India increased. Ultimately, the rate of crude oil exports to all destinations in the second half of the year (2.2 million b/d) was higher than in the first half (1.8 million b/d).
Supertanker Loads American Oil Without Nearing US - (Bloomberg) -- A supertanker filling up with crude in the Gulf of Mexico is routine these days. Less so is a supertanker loading American oil without coming within a thousand miles of the Texas or Louisiana coast. The Alsace is steaming for China laden with about 2 million barrels of West Texas Intermediate crude after spending three weeks in the Caribbean, according to ship-tracking data and a document seen by Bloomberg. It received its cargo via two ship-to-ship transfers and one terminal visit in the U.S. Virgin Islands. For reasons that aren’t entirely clear, the Alsace didn’t go to the U.S. coast to get the oil. Instead, two ships -- the Almi Galaxy and Ionic Aspis -- traveled some 2,000 miles from Beaumont, Texas, and arrived in late March at Limetree Bay oil terminal at St. Croix. The Almi Galaxy offloaded its contents via ship-to-ship transfer to the Alsace. The Ionic Aspis, which had arrived earlier, offloaded its cargo into a tank at the terminal where the supertanker later picked it up, according to a person familiar with the matter who asked not to be identified because the purchases aren’t public. After loading at St. Croix, Alsace set course for Aruba. Off its coast, the supertanker received more oil from the Serenea, which had also loaded in Beaumont, according to the person familiar and ship-tracking data. Alsace was chartered by Unipec, the trading arm of China’s largest refiner China Petroleum and Chemical Corp., known as Sinopec, the person said. Unipec has been using tanks leased by Sinopec at Limetree Bay’s oil terminal at St. Croix. But the Asian trader has previously loaded VLCCs in the Gulf of Mexico to send American oil overseas. Alsace is now signaling that it’s heading to China, expected to reach Zhoushan around May 19
Schlumberger profit falls 19.8 percent on weak North America activity (Reuters) - Oilfield services provider Schlumberger NV on Thursday forecast rising international and offshore exploration spending this year, after posting a 20 percent drop in first-quarter profit due to weak North American demand. The oilfield services sector bellwether said it expects a 7 to 8 percent increase in investments by oil producers in markets outside North America, citing a 20 percent increase last quarter in offshore rig counts and growing exploration activity in Latin America, Africa and Asia. “We still see a fairly decent runway for increased international investments,” Chief Executive Officer Paal Kibsgaard said, citing higher new project approvals and a renewed interest in exploration outside North America. Second-quarter earnings per share will be 35 cents, in line with the Wall Street consensus estimate, said Kibsgaard. He cautioned seasonal factors would preclude the potential for exceeding that figure. Shares rose 1.8 percent to $48.27 in early trading, adding to the nearly 31 percent increase this year through Wednesday. Schlumberger previously forecast high single-digit percentage growth in international markets this year and a 10 percent year-over-year decline in onshore North American customer spending due to constraints on producer spending. U.S. oil producers remain wary of boosting spending, despite record U.S. oil production and a recovery in crude oil prices, as they focus on earnings growth to pacify shareholders. Schlumberger’s cash flow from operations fell to $326 million in the first quarter, from $568 million a year earlier. Net income declined to $421 million in the three months ended March 31, from $525 million a year earlier.
Exxon, Others Add to Claims That US Sold Toxic Crude - Exxon Mobil Corp. is the latest company to raise concerns that a stockpile of U.S. government crude is tainted with poisonous gas. The American energy giant said some of the oil it purchased last year from the Energy Department’s Strategic Petroleum Reserve, or SPR, contained "extremely high levels" of hydrogen sulfide, according to emails obtained by Bloomberg under the Freedom of Information Act. In some cases, the gas level was 250 times higher than government safety standards allow. Analysts have pointed to the stockpile as a safeguard against tightening crude supplies after U.S. sanctions on Iran and Venezuela curbed their oil exports. But Exxon’s discovery, which follows complaints by Royal Dutch Shell Plc, Macquarie Group Ltd and PetroChina Co., suggest that the reserve may not offer refiners as much insurance against diminishing volumes of higher sulfur, or sour, crude as previously thought. In PetroChina’s case, the agency acknowledged spending around $1 million to clean up a contaminated cargo. The prospect of tainted crude in the reserve complicates future sales of U.S. oil, a key tool for funding government programs. A 5 million-barrel sale is planned for 2019, and 221 million barrels of oil are planned for sale from 2020 to 2027. While hydrogen sulfide occurs naturally in crude, producers often take pains to remove it because it can put workers at risk and corrode pipelines and refineries. Many pipelines have capped the permitted amount of hydrogen sulfide, or H2S, at 10 parts per million (ppm). " Exxon was one of five companies that purchased oil in an Energy Department sale in August. Exxon took 1.5 million barrels of Bryan Mound sour crude -- a high sulfur oil that’s recently become more expensive as global supply shrink -- by pipeline to Texas City. There, the company discovered hydrogen sulfide levels that were at 5,000 ppm, according to emails sent to the department in November by Mattias Bruno, a lead oil trader at Exxon Mobil. The exposure limit set by the Occupational Safety and Health Administration is 20 ppm. Exposure at 500-700 ppm could cause a person to collapse in five minutes and die within an hour.
Russia seeks Chinese support in developing Arctic shipping routes, promising long-term gas supplies in return - Russia wants to team up with China to build an Arctic shipping route, its ambassador to Beijing has said. Moscow recently set out an ambitious programme to build new ports and other infrastructure facilities to increase cargo shipments across the Arctic, also known as the Northern Sea Route. Russian ambassador Andrey Denisov told the South China Morning Post that negotiations over the supply of Russian gas to China through a route known as Power of Siberia Two were at an advanced stage. “Almost everything has been completed so far but there is only one gap, which is the price,” Denisov said. “Price is the final detail but a crucial one and it’s quite natural in the discussion between seller and buyer – the seller wants the price as high as possible but the buyer wants to pay as little as possible.” Denisov said the two sides were accelerating the pace of the negotiations and he was optimistic they would reach a deal. “China as a buyer needs gas and a reliable long-term source. Russia is definitely that kind of source,” he said.
Venezuela skirts U.S. sanctions by funneling oil sales via Russia - President Nicolas Maduro is funneling cash flow from Venezuelan oil sales through Russian state energy giant Rosneft as he seeks to evade U.S. sanctions designed to oust him from power, according to sources and documents reviewed by Reuters. The sales are the latest sign of the growing dependence of Venezuela’s cash-strapped government on Russia as the United States tightens a financial noose around Maduro, who it describes as a dictator. With its economy reeling from years of recession and a sharp decline in oil production, Venezuela was already struggling to finance imports and government spending before Washington imposed tough restrictions on state oil company PDVSA in January. Oil accounts for more than 90 percent of exports from the OPEC nation and the lion’s share of government revenues. Maduro has accused U.S. President Donald Trump of waging economic war against Venezuela. Since January, Maduro’s administration has been in talks with allies in Moscow about ways to circumvent a ban on clients paying PDVSA in dollars, the sources said. Russia has publicly said the U.S. sanctions are illegal and it would work with Venezuela to weather them. Under the scheme uncovered by Reuters, Venezuelan state oil company PDVSA has started passing invoices from its oil sales to Rosneft. The Russian energy giant pays PDVSA immediately at a discount to the sale price avoiding the usual 30-to-90 day timeframe for completing oil transactions and collects the full amount later from the buyer, according to the documents and sources. “PDVSA is delivering its accounts receivable to Rosneft,” said a source at the Venezuelan state firm with knowledge of the deals, who spoke on condition of anonymity for fear of retaliation.
Venezuela's Guaido to seek to annul $8.7 bln Conoco award (Reuters) - Venezuelan opposition leader Juan Guaido will seek to annul an $8.7 billion arbitration award to U.S. oil producer ConocoPhillips as he moves to preserve foreign assets, Guaido’s chief legal representative said on Tuesday. If accepted, the annulment request would halt enforcement of the award over the 2007 loss of Conoco’s projects in the South American country. It would follow a March decision by the World Bank’s International Center for Settlement of Investment Disputes (ICSID) to impose the largest arbitration award against Venezuela. Jose Ignacio Hernandez, whom Guaido has tapped as a special prosecutor, told Reuters his team separately has challenged the amount of the ICSID award, claiming “the methodology to determine the compensation was errant.” Conoco would see no merit in a request for “annulment or rectification” and would “strongly defend” against such requests, company spokesman Daren Beaudo said. George Kahale, a U.S. attorney who represented the Venezuelan government before the World Bank tribunal, did not immediately respond to a request for comment. Venezuela’s information ministry also had no immediate response to a request for comment. An annulment would be a boost to Guaido, who in January invoked a constitutional provision to assume an interim presidency. Backed by the United States and dozens of other countries, Guaido argues President Nicolas Maduro’s 2018 re-election was illegitimate.
Exclusive: Spain's Repsol suspended swap deal for Venezuelan oil under U.S. pressure (Reuters) - Spain’s Repsol suspended its swaps of refining products for crude with Venezuela’s state-run oil company PDVSA, people familiar with the matter said, as U.S. officials weighed penalties for foreign firms doing business with Venezuela. The Spanish oil company has been swapping fuel and waiving payments due from a joint venture with PDVSA in exchange for crude, even as the United States rolled out new sanctions aimed at ousting Venezuela’s socialist President Nicolas Maduro. The arrangement made Repsol one of the OPEC-member nation’s main fuel suppliers, alongside Russia’s Rosneft and India’s Reliance Industries, according to three sources and vessel-tracking data. Repsol declined to comment on the matter on Wednesday. On Thursday, a day after the United States decided not to take new actions against foreign companies doing business with Venezuela, Repsol said it had not suspended its program. “The operations are continuing normally,” spokesman Kristian Rix said. “There has been no change from last week, the prior week to now.” The Trump administration blames Maduro for a severe economic crisis that has forced millions of Venezuelans to flee. The United States and dozens of other countries recognize Venezuelan opposition leader Juan Guaido as the nation’s interim president. Maduro considers Guaido a U.S. puppet.
Bombing damages Colombia pipeline, second spill under investigation (Reuters) - A bombing damaged a section of Colombia’s Trasandino pipeline, state-run company Ecopetrol said on Saturday, and the company was investigating a crude spillage from the Cano Limon pipeline to determine if it was also caused by an attack. The attack on the Trasandino took place late on Friday in Barbacoas municipality in southwestern Narino province, Ecopetrol said in a statement. The company was assessing the extent of the damage, it said. Photos posted by Ecopetrol on Twitter showed oil-slicked grass and a puddle of crude next to the damaged pipeline. The Trasandino was not operating at the time of the attack, the company said. Ecopetrol is working to verify the cause of a crude spillage from the Cano Limon pipeline in Tibu municipality in eastern Norte de Santander province, it said in a second statement. There were reports of a loud explosion and crude has spilled into two ravines in the area, it said. There have been around 20 attacks on Colombian pipelines so far in 2019. The 485-mile (780-km) Cano Limon pipeline was kept offline for most of 2018 because of more than 80 bombings. Although Ecopetrol did not name the group responsible for the Trasandino bombing, the leftist National Liberation Army (ELN) rebel group, considered a terrorist organization by the United States and the European Union, regularly attacks pipelines.
Petrobras CEO denies government interference after diesel price hike canceled (Reuters) - Roberto Castello Branco, chief executive officer of oil company Petroleo Brasileiro SA, denied there was government interference even after the state-controlled oil company delayed a diesel price hike after a call from President Jair Bolsonaro. Castello Branco, the CEO of Petrobras, said President Bolsonaro warned him in the call about the risks of a potential new truckers strike if diesel prices rose. “The decision was taken by Petrobras management, no one told the company to cancel the price rise,” he said, after leaving a meeting with cabinet ministers at the presidential palace in Brasilia. Castello Branco met on Monday with Mines and Energy minister Bento Albuquerque, Infrastructure minister Tarcisio Freitas, and Economy minister Paulo Guedes. He said Petrobras fuel pricing policy was not discussed during the meeting. The presidential palace said in a statement the meeting discussed “solutions to road transportation.” The CEO said the company will decide whether the price of diesel will be raised. Castello Branco will meet with President Bolsonaro on Tuesday to discuss the diesel pricing policy.
Petrobras hikes diesel price, eyes divestments amid investor unease (Reuters) - Brazilian state-run oil firm Petroleo Brasileiro SA hiked diesel prices on Wednesday, and executives said the firm could expand its already aggressive divestment plan while arguing the company was completely free of political interference. In an impromptu news conference at the Rio de Janeiro headquarters of Petrobras, as the company is known, Chief Executive Roberto Castello Branco announced a diesel price hike of 10 cents per liter and said Petrobras has complete control over its pricing strategy. Speaking only minutes before at an event in Sao Paulo, Chief Financial Officer Rafael Grisolia said Petrobras was looking at selling off assets such as deepwater pipelines and Petrobras Distribuidora SA, which includes a gas station chain stretching across the country. The comments come as executives scramble to contain the fallout from the company’s cancellation on Friday of a diesel price hike at the behest of Brazilian President Jair Bolsonaro, stirring fears of political interference and tanking Petrobras shares. While Bolsonaro´s government has promised a hands-off approach to Petrobras, investors are wary of a return to policies enacted under past administrations, in which the company was forced to sell fuel at a discount to international rates. On Tuesday, Bolsonaro´s spokesman and Economy Minister Paulo Guedes sought to characterize the canceled price hike as a one-time error that would not be repeated. According to an information posted on Petrobras’ website, the company increased the price of diesel at refineries by 4.7 percent after canceling a 5.7 percent increase on Friday. Castello Branco said Petrobras “rigorously” keeps its prices in line with international rates and has no plans to change its policy of adjusting fuel prices every 15 days.
ConocoPhillips exits UK oil and gas production in huge $2.7 billion North Sea sale - ConocoPhillips on Thursday announced it has struck an agreement to sell its U.K. oil and gas operations for nearly $2.7 billion, setting up its exit from the North Sea. The Houston-based driller will sell its ConocoPhillips United Kingdom subsidiaries for $2.675 billion to Chrysaor E&P, a company focused on producing oil and natural gas from the North Sea. The transaction is expected to close in the second half of 2019. The deal is the largest transaction in the exploration and production space outside the U.S. this year, according to investment bank Jefferies, which acted as Chrysaor’s financial advisor. . ConocoPhillips has been marketing the assets for several months. The company will retain its commercial trading business in London and its roughly 40% interest in the Teesside oil terminal. It will also continue to operate the terminal, which receives oil and gas from the North Sea fields. Earlier this year, Conoco’s chief operating officer, Matthew Fox, said the company’s major portfolio restructuring was essentially complete, with the exception of the North Sea sale. The company earned nearly $1.1 billion on dispositions in 2018. The deal makes Chrysaor one of the largest producers in the U.K. North Sea.
Life imitates art: Norway rejects oil prospecting in sensitive Arctic islands -- In what seemed like an episode of the Norwegian television drama Occupied, Norway's largest political party joined smaller ones in the nation's parliament to prevent oil exploration in the scenic Lofoten archipelago. The Labor Party's environmental wing made climate change and scenic beauty big issues.Unlike another contentious oil resource, Alaska's Arctic National Wildlife Refuge, these islands get around 1 million visitors each year. That implies that many Norwegians have actually seen the islands.In the history of oil-rich nations, Norwegians have followed an unorthodox path. While most such nations have chosen to subsidize domestic prices of petroleum products or at least keep them cheap by policy, Norway has taxed consumption of oil and oil products as if the country were an importer trying to economize on petroleum use.A recent Bloomberg survey showed that the average price of a gallon of gas worldwide was $3.48. The range was 1 cent in Venezuela to $7.61 in Hong Kong. Norway ranked second highest at $6.89.Even more strange is that Norway has become a leading market for all-electric cars. About one-third of all new cars sold in the country last year were all-electric. Of course, Norway has very large hydroelectric resources, resources which produced 93.6 percent of the country's electricity in February 2019, the most recent month for which data is available. But these copious hydropower resources have long been available and didn't prevent the country from becoming dependent on petroleum-fueled transportation just like the rest of the world. Norway also made a fateful and propitious decision shortly after the discovery of its oil and natural gas riches in the North Sea. The country decided to invest much of the tax revenue derived from oil and gas in a sovereign wealth fund to be managed on behalf of the Norwegian people for use by future generations. Most oil-rich nations choose to spend their oil wealth as quickly as it comes in. Today, based on current exchange rates, the Norwegian fund has more than $1 trillion invested, making it the largest sovereign wealth fund in the world.
Argus is publishing a new price index for crude oil in Europe called New North Sea Dated --- The new price index is based on a robust methodology that combines the liquidity of the existing market for North Sea crudes with a range of delivered Rotterdam assessments of other crudes regularly consumed in Europe. The North Sea market provides the price benchmark for much of the crude traded around the world, including exports from Russia, Africa, Latin America and the Middle East (to Europe) and deliveries into Asia. The disruption to the Forties pipeline in late 2017 and the increasing removal of benchmark-grade Forties from the North Sea market for shipment to Asia has left the market appearing short, illiquid and volatile. However, there is a large and growing volume of similar light, sweet crude available to European refiners, especially from the US. The market requires a regional European benchmark that reflects the new reality. Argus is the first to introduce a fully formed new methodology that builds on the strengths of the existing market, while incorporating new market reality. Today, delivered grades are just as likely to provide the clearing price signal. As North Sea production declines and European refiners look for alternative sources of crude, the volume of US WTI crude refined in Europe (around 900,000 b/d) is expected to surpass the combined production of all North Sea BFOET grades (currently 910,000 b/d). US WTI crude is the most competitively priced light, sweet grade in the European market and should be part of the benchmark-setting process. We also include other similar-quality grades that are regularly delivered to Europe — Saharan Blend, BTC Blend, Bonny Light, Escravos and Qua Iboe — to increase liquidity and allow for more participation in the benchmark-setting process.
Treasure on the high seas for gas dealers (Reuters) - In the booming market for super cooled natural gas, the most precious commodity is the ship. A global quest for cleaner energy has fired up demand for liquefied natural gas (LNG), which produces less carbon dioxide than coal. But an abundance of supply has helped keep prices subdued, meaning the most profitable trade is in renting out vessels to transport it. Reflecting the white-hot demand for ships, over a dozen different companies, including energy majors BP and ExxonMobil, trading house Trafigura and gas utility Centrica are already looking to charter boats for the winter, according to four shipping industry sources, months earlier than usual. ExxonMobil, Centrica and Trafigura declined to comment. BP did not respond to requests for comment. Energy firms are trying to avoid getting stuck without ships on charter for the winter, when cold weather typically drives up trade in LNG and, consequently, transport costs. They also want to profit off less nimble rivals. Last winter, spot charter rates – the cost of renting a ship to transport LNG in real-time – soared to almost $200,000 per day in November compared to around $40,000 in May, squeezing those companies which had left it too late to secure vessels cheaply. Currently, spot rates are around $40,000 per day while rates for charters covering next winter are between $70,000-$80,000 a day, two shipping industry sources said. Energy groups including Shell, BP, China National Offshore Oil Corp (CNOOC), Cheniere and Gazprom, utilities Naturgy and Centrica and trading firms such as Gunvor and Trafigura are renting vessels for months or years and sub-letting some of them to competitors, according to half a dozen sources. None of the firms would comment.
Exxon Eyes Floating LNG Partnership in Israel -- Exxon Mobil Corp. is in discussions to build a platform that would expand the export reach of Israel’s biggest natural gas field, according to people familiar with the matter. Israeli gas stocks rose. The world’s largest publicly-traded oil and gas company is in talks with the firms developing Israel’s Leviathan reservoir to build a floating liquefied natural gas ship, the people said, requesting anonymity because the matter is private. Such a project would allow the Leviathan partners to export to countries not reachable with pipelines and avoid the need to build expensive infrastructure to connect to LNG facilities in Egypt. It’s possible the discussions ultimately won’t lead to a partnership, the people cautioned. An Exxon representative said the company was still evaluating its options. “It’s too early to comment on specific development and production timelines,” the representative said. Despite considerable gas discoveries in the Eastern Mediterranean region over the past decade, viable export routes have proven tough to find and global energy firms haven’t rushed in. The Leviathan partners have signed deals to meet surging demand in Egypt, Jordan and Israel, but haven’t yet found a way to export to Europe or East Asia. The partners developing Leviathan, a deep-sea find of about 600 billion cubic meters -- at the time it was found, the biggest underwater gas discovery in a decade -- have bookmarked the next phase of the reservoir’s development for export deals and are examining ways to reach markets outside the region. The talks with Exxon are the latest sign that an unofficial energy boycott on Israel, imposed by leading Arab countries, is fading. Energy majors that partner with big Arab firms have hesitated to do business with Israel in the past, for fear of risking ties with states that control some of the world’s biggest energy reserves and have been hostile toward Israel until now.
Significant Gas Discovery at Karish North - Energean Oil and Gas announces that the Karish North exploration well has made a significant gas discovery. Energean Oil and Gas plc announced Monday that the Karish North exploration well has made a “significant” gas discovery. Preliminary analysis of the find indicates initial gas in place estimates of between 1 and 1.5 trillion cubic feet, according to Energean. The Karish North discovery will be commercialized via a tie-back to the Energean Power FPSO, which is located 3.3 miles from the Karish North well. The FPSO is being built with total processing and export capacity of 775 million cubic feet per day. Drilling of the initial phase of the Karish North well is complete. Energean said it will now deepen the well to evaluate hydrocarbon potential at the D4 horizon. “We are delighted to be announcing this significant new gas discovery at Karish North, which further demonstrates the attractiveness of our acreage offshore Israel,” Mathios Rigas, CEO of Energean, said in a company statement. “We are building the Energean Power FPSO with spare capacity, which will enable us to quickly, safely and economically develop both Karish North and future discoveries,” he added. In a statement posted on his Twitter page, Rigas highlighted that this was the first gas discovery in Israel “after a long time” and stated that Energean is “now a producer, developer and successful explorer in the Med”.
$6B Project with Up to 8,000 New Jobs Sanctioned - The steering committee for the offshore Azerbaijan ACG field has sanctioned the next stage of the development. The $6 billion Azeri Central East (ACE) project will include a new offshore platform and facilities designed to process up to 100,000 barrels of oil per day. The project is expected to achieve first production in 2023 and produce up to 300 million barrels over its lifetime. Construction activities, which will commence this year and run through mid-2022, will take place in-country utilizing local resources. It is expected that, at peak, construction activities will create up to 8,000 jobs. “Today’s announcement supports the long-term production plans we set for ACG when we extended the production sharing agreement (PSA),” Gary Jones, BP’s regional president for Azerbaijan, Georgia and Turkey, said in a company statement. “It demonstrates our commitment to work with SOCAR and Azerbaijan’s government to continue to unlock ACG’s resources more efficiently and competitively,” he added. Rovnaq Abdullayev, president of SOCAR, said, “today’s sanctioning marks yet another important milestone in the development of ACG for the benefit of the nation”. “Looking forward, we expect more than three billion barrels of additional oil production from ACG. This strategic decision supports Azerbaijan’s increasing role as an energy supplier for the regional and global markets,” he added.
Foreign tankers suspected of causing oil spill off Kota Tinggi - Authorities suspect foreign tankers discharged marine fuel oil that resulted in the oil spill detected off Kota Tinggi yesterday.Southern Region Marine Department director Dickson Dollah said satellite images had captured several vessels anchored over two days from April 14 in the waters of Tanjung Balau and Batu Layar where the spill had occurred.“We believe they discharged the oil at night to escape detection by the authorities,” he told Bernama when contacted today.He said it is believed that the vessels had left the area. Dickson also said it is estimated that 300 tonnes of marine fuel oil had been discharged and the spill covered an area four nautical miles from the coast. A clean-up operation was launched at 6am today and it could take three or four days to clear the spill, he said.
1km oil spill detected in Tanjung Balau - Johor Marine Department detected a one kilometre oil spill along Tanjung Balau waters here this afternoon. Its director Dickson Dollah said the oil spill was discovered during a patrol at the area at about 3pm. He said some of the oil spill has reached Tanjung Balau beach. “We haven’t confirmed the type of oil yet, but it’s black in colour and we believe it’s marine fuel oil. “We also haven’t confirmed the vessel responsible as we’ve been informed that there were no vessels at the area that could be involved in spilling the oil. “We have informed Johor Environment Department and they will conduct a check tomorrow,” he said in a statement tonight. Dickson said a boat from the Marine Department Southern Region has been ordered to do the clean-up and will depart from Tanjung Pengelih towards the location at 6am tomorrow. He added that ‘Oil Spill Response’ team has also been ordered to prepare additional tools such as the absorbent boom and petrol supply to Tanjung Pengelih tonight. “Pengerang local authority has also been informed to help with beach clean-up,” he said.
Oil Spill Dispersant market to reach $23.6bln by 2026 - The global Oil Spill Dispersant Market is anticipated to grow at a constant CAGR around 3% during the forecast period 2019 to 2026 and reach the market value around USD 23.6 billion. The growth of the market for oil spillers depends directly on the frequency, the time and volume of petroleum spill events, said a market report by Acumen Research and Consulting. Oil pollution is a common term for seawater, land water or land contamination due to oil release due to an accident or human error. Oil contamination is spread throughout the world and is boiled both onshore and offshore. The number of major oil spills annually decreases since the last ten years, but very frequent small oil spills are mainly driving the market for petroleum spills. In addition, a consistent search for the new petroleum sources and oil plants will fuel the growth of the market for petroleum spills. Another driving force of the global market for oil spills is strict government regulations and penalties to enhance the response of oil spills. The small oil spills occur regularly and can be easily and rapidly monitored. Large-scale oil spills such as the oil spill of Deepwater Horizon can have a catastrophic effect on the environment's ecosystem for decades. Also, such massive oil spills could result in the long-term ruin of the area's infrastructure and economy. Consequently, it is very important to prevent or reduce further environmental and economic losses to reduce the impact of oil spills early on. In order to prevent oil spills, several products and services are available on the market. One of the most popular methods to reduce the effect of oil spills is the use of oil spills dispersants. The global market of oil spills is divided into offshore and onshore based on application. With 70 percent of market share in 2017, the offshore application segment led the market. The incidents of offshore crude oil spills have a higher frequency than onshore crude oil spills, which lead to an increased utilization of offshore oil spills. Offshore and onshore products are the global market for oil spills.
Indian Refiners Rush To Buy Iranian Oil Before It’s Too Late - India’s oil imports from Iran increased by some 5 percent between March 2018 and March 2019 compared to the previous fiscal year through March 2018, because Indian refiners rushed to buy Iranian oil before the U.S. sanctions kicked in in November and hurried to wind up purchases ahead of the waiver expiring early next month. According to preliminary data for tanker arrivals, obtained by Reuters from industry and shipping sources, India’s imports of Iranian oil rose to around 479,500 bpd in the 2018/2019 Indian fiscal year ended last month, compared to some 458,000 bpd that Indian refiners imported in the 2017/2018 fiscal year. Between April and October 2018, India’s refiners were buying more than usual Iranian oil because none of Iran’s oil customers were certain that it would get a U.S. sanctions waiver to continue purchases from Iran after the sanctions were re-imposed in early November 2018. Another major reason for increased Indian buying of Iranian oil before November was that Iran was offering very attractive terms to Indian buyers, including almost free shipping and an extended credit period for payment. India—alongside seven other Iranian oil customers including the biggest buyer China—received a U.S. waiver to continue buying Iranian oil, at a rate of around 300,000 bpd. Although not all Indian refiners continued purchases because private companies with exposure to the U.S. financial system were wary of secondary sanctions if they buy oil from Iran, India used up its 300,000 bpd quota allowed under the current exemption.According to the data obtained by Reuters, India’s imports of Iranian oil jumped to 405,000 bpd in March 2019, up by 56 percent from February 2019. Refiners want to make sure they wind down payments before the waivers expire, while a shortage of ships moved some cargo loadings to the end of February with arrival in India in March. India is not booking Iranian oil due to load in May, as refiners are waiting for more clarity from the U.S. on whether India will get its sanctions waiver extended, Reuters reported earlier this week, citing four sources.
Iran Peddling 1MM Barrels of Oil Again -- An Iranian exchange has offered investors as much as 6 million barrels of oil so far this year. Only a single deal closed, for the minimum 35,000 barrels. Iran’s oil production and exports have slumped after the U.S. reinstated sanctions last year, and new curbs are set to further restrict its exports. Exemptions for importing countries including Japan, China, Turkey, India and South Korea have partially cushioned the blow. With foreign investors steering clear of the world’s fourth-largest holder of crude, it’s trying via the Iran Energy Exchange to offload some oil to domestic buyers. Sales have been dismal, and even Iranian oil officials concede that the physical contracts are undesirable as long as oil sanctions remain intact. “We knew from the beginning that it was almost impossible to sell oil” on the exchange, Morteza Behrouzifar, deputy head of the Iranian Association for Energy Economics, said in an interview. “Iran’s crude is sanctioned and under no circumstances can anyone buy Iranian crude except those who were granted waivers.” Iran has tried to sell oil on its exchange in the past. The first offerings in 2011 weren’t successful, and another effort to sell just under three thousand barrels in 2014 wasn’t received well by potential buyers, state-run Islamic Republic News Agency reported last week. The exchange is offering another million barrels of light crude for a 6 percent down payment and 90 days of credit this week. But it’s up to the buyer to line up the tanker and insurance needed to transport the fuel to the ultimate user. “Those who have waivers go directly to the National Iranian Oil Co. They don’t need to participate in the bourse,” Behrouzifar said. “It’s pretty immature to think of the energy exchange as a way to get around sanctions.”
Iran Oil Buyers Stay on Sidelines -- The biggest buyers of Iranian oil are said to be putting their purchases on hold as they wait to see whether the White House will extend waivers allowing them to keep buying the crude. Most Asian buyers are avoiding imports for next month as it’s unclear what will happen to the exemptions that are set to expire in the first week of May, according to people with knowledge of the matter. Even if the waivers are extended, it would be too late to order and receive cargoes for the month, said the people who asked not to be identified as the information is private. The U.S.’s surprise decision last year to allow eight nations to keep buying Iranian oil was a big contributor to the plunge in crude prices in the fourth quarter. While the White House appears keen to keep the pressure on the Persian Gulf nation, analysts including FGE have speculated that preventing further gains in oil prices is a bigger priority for President Donald Trump. Given that crude has recovered strongly this year, that suggests that at least some of the waivers may be extended. At least five refiners in South Korea, Japan and China are not planning to import Iranian crude and condensate loading in May, the people said. Some Korean and Japanese processors have already bought alternative cargoes for the period, while Iran is being flexible with its customers on timing, they said. Iranian shipments take over 20 days to reach east Asia, meaning there won’t be enough time for the cargoes to load and arrive during the same month. Japanese refiners say imports from Iran might start loading in June at the earliest if the exemptions are extended, the people said. The nation took 108,000 barrels a day of Iranian supplies last month, tanker tracking data from Bloomberg show. India may take some shipments next month if the waivers are extended because shipping time from Iran is only about a week, the people said. The South Asian nation was already in discussions for an extension of the waiver and the country’s processors are allowed to import 9 million barrels of Iranian oil every month under the 180-day exemption.
White House will tie Iran sanctions review to response by Saudi Arabia: Kemp (Reuters) - The White House will have to weigh costs and benefits carefully before tightening sanctions on Iran and Venezuela further – and decide whether the economic price is worth the diplomatic gains. If the White House toughens sanctions on Iran and Venezuela significantly (and the next decision on Iran sanctions is scheduled for the first week of May) any decision is likely to be tied to production increases by Saudi Arabia. The White House is likely to agree to scale back Iran sanctions waivers if, and only if, Saudi Arabia commits to replacing the lost barrels at least one-for-one to leave the global production-consumption balance unchanged. High-level discussions between the two countries over sanctions and production policy are likely to have begun already. President Donald Trump spoke with Saudi Arabia's Crown Prince Mohammed bin Salman by telephone earlier this month about maintaining pressure on Iran and human rights, according to a statement from the White House. The content of the discussions was not made public but it is safe to assume that oil prices, production and sanctions formed part of the discussion since they are central to the bilateral relationship as well as policy towards Iran. If sanctions are tightened, it will be because the White House believes it has an undertaking from Saudi Arabia to increase production by at least the equivalent amount, if not more, to contain the impact on U.S. motorists.
IEA Says Oil Market Tightening-- Global oil markets are tightening as OPEC supply falls, the International Energy Agency said, while warning it could lower demand forecasts because of economic threats. Crude inventories are set to decline for the rest of the year as Saudi Arabia and its partners curb production, while exports from Venezuela and Iran are squeezed by economic and political crises, the agency said in its monthly report. But it cautioned that threats in the world economy, from Europe to emerging markets, could take a toll on fuel consumption. “The oil market shows signs of tightening as we move into the second quarter of 2019, but we see mixed signals in terms of the outlook for demand,” said the Paris-based agency, which advises most major economies. Risks to demand are “currently to the downside.” Crude prices have rallied more than 30 percent in London this year and are trading above $71 a barrel as Saudi Arabia spearheads output cutbacks by the Organization of Petroleum Exporting Countries and its allies. Yet the gains have been capped by fears about global economic growth, which the International Monetary Fund predicts will this year be the weakest since the financial crisis a decade ago. Global oil supplies declined last month amid another steep drop in OPEC output, as the Saudis cut more production than promised and Venezuela’s unintended losses swelled. Supply growth outside OPEC also slowed sharply as Canada pared output and the North Sea suffered declines, the IEA said. As a result of OPEC’s restraint, inventories in developed nations are below their five-year average in terms of the amount needed to cover projected demand, having fallen in February for the first time in four months. The agency noted that crude-oil inventories will decline by more than 2 million barrels a day in the third quarter, the biggest drop since 2011. There was a similar, though smaller, reduction in the same period a year earlier as refiners processed more crude to build up stockpiles of fuels ahead of the winter.
Hedge funds' oil positions start to look stretched: Kemp - (Reuters) - Hedge fund managers continue to accumulate positions in crude and gasoline in the most sustained bull market since 2017 but the market is starting to look stretched and the balance of risks is shifting to the downside. Hedge funds and other portfolio managers have boosted their net long position in the six most important petroleum futures and options contracts by 503 million barrels over the last 13 weeks. Fund managers have added 294 million barrels of bullish long positions since Jan. 15 while trimming 215 million barrels of bearish short positions since Jan. 8, according to exchange and regulatory data published on Friday. Bullish long positions now outnumber bearish short ones by a ratio approaching 7:1, up from less than 2:1 at the start of January (https://tmsnrt.rs/2VPrFFO ). Since 2015, the accumulation of a large concentrated long or short position has often heralded an impending turning point in the petroleum price trend. In early January, the large number of hedge fund short positions signalled an approaching rally in prices from the lows late last year, as fund managers covered short positions. By April, however, the concentrated long positioning started to signal a likely reversal in the rally, or at least a pause, if fund managers attempt to take some profits. The biggest positioning imbalances are concentrated in crude and U.S. gasoline; there is no sign of similar imbalances in middle distillates such as U.S. heating oil and European gasoil. Portfolio managers have raised their combined net long position in Brent and WTI in 11 out of the last 13 weeks by a total of 397 million barrels. Long positions in Brent and WTI outnumber short ones by a ratio of almost 8:1, up from less than 2:1 at the start of January. In addition, funds have raised their net long position in U.S. gasoline in nine out of the last 10 weeks by a total of 58 million barrels. Long positions outnumber short ones by more than 26:1, up from just 2:1 in late January, one of the largest imbalances on record. Bullish long positions in gasoline and crude are still below the record levels set earlier in 2018, so there is still scope for fund managers to increase their long positions. But most of the short positions in crude and gasoline initiated during the fourth-quarter sell off have now been closed out, removing an important source of buying.
Oil edges lower as supply concerns check losses Oil prices fell on Monday as investors weighed mixed signals on global supply and signs that Russia may exit coordinated production cuts by nearly two dozen nations.Losses were limited by a tightening of global supplies, as output has fallen in Iran and Venezuela amid signs the United States will further toughen sanctions on those two OPEC producers. Brent crude oil futures were down 61 cents, or nearly 1%, at $70.94 a barrel around 8:35 a.m. ET (1235 GMT), having hit their highest since Nov. 12 on Friday at $71.87. U.S. West Texas Intermediate crude futures fell 61 cents, or 1%, $63.28 per barrel. WTI touched a five-month high at $64.79 last week. "I would expect oil to trade in a relatively tight band around $70 per for the time being," said Virendra Chauhan, pointing to differing signs from the United States and OPEC on future supply."Leading edge indicators on U.S. supply suggest activity levels are stepping up, which is supportive for strong production growth in the second half," said Chauhan. But at the same time, "murmurings from various ministers of the OPEC+ pact suggest supply from the group will not be ramped up pre-emptively as per last summer," he said. OPEC and its allies meet in June to decide whether to continue withholding supply. OPEC, Russia and other producers, are reducing output by 1.2 million barrels per day from Jan. 1 for six months.OPEC's de facto leader, Saudi Arabia, is considered keen to keep cutting, but sources within the group said it could raise output from July if disruptions continue elsewhere.Meanwhile, Russia's Finance Minister Anton Siluanov was quoted by the TASS news agency as saying on Saturday that Russia and OPEC may decide to boost production to fight for market share with the United States but this would push oil prices as low as $40 per barrel.
Did Russia Just Call The End Of The OPEC Deal? - OPEC and heavyweight Russia may fight America for its share of the oil market, Russia’s Finance Minister Anton Siluanov told TASS on Saturday, even if it means quitting the OPEC deal and lowered oil prices.OPEC and Russia have tapered oil production according to the agreed upon production cut deal, but the United States continues to increase its production and is picking up market share in the process - market share formerly held by OPEC members and the other non-OPEC signatories to the deal including Russia.Any failure in the production cut deal, however, will have a negative impact on prices, and could theoretically plunge prices into the $40 per barrel territory. This, in turn, would squeeze US oil producers and hurt new investments, Siluanov said.“(If the deal is abandoned) the oil prices will go down, then the new investments will shrink, American output will be lower, because the production cost for shale oil is higher than for traditional output.”Siluanov’s comments came in tandem with warnings of a looming global economic recession.“The risks of an upcoming global recession are very high,” the Finance Minister said.“We are ready for a change in global energy prices – we have prepared the budget, the reserves, the balance of payments. We have created this kind of system.”Russia has been the wildcard in the OPEC+ production cut deal, and has long sent mixed messages regarding their all-in-ness of the deal. And as US production increases and its market share expanding, OPEC’s clout is waning, highlighting the importance of its relationship with Russia. OPEC’s production has fallen to levels below its commitment. The United States, however, continues to increase production, and currently sits at an all-time-high of 12.2 million bpd, according to the EIA. Before the original production cut deal was established in December 2016, US oil production sat at 8.77 million bpd—a significant increase that undoubtably puts pressure on any of the countries who have tapered production. President Vladimir Putin on Tuesday, however, assured markets that Russia would continue its cooperation with OPEC. “We will closely monitor the market, but we will continue cooperation with OPEC,” Putin told TASS, following it up with a more ambiguous chaser.
Oil ends lower as Russian reportedly questions output cuts on market share - Oil futures ended lower Monday on the heels of a multiweek climb, as a Russian official reportedly questioned his country’s participation in the OPEC-led production cut deal on concerns over market share. West Texas Intermediate for May delivery, the U.S. benchmark crude, on the New York Mercantile Exchange fell 49 cents, or 0.8%, to settle at $63.40 a barrel. It rose last week, marking a sixth straight weekly gain. “The [year-to-date] performance is astonishing and investors feel that they need to take some profit off the table.” The global benchmark, June Brent crude also lost 37 cents, or 0.5%, to $71.18 a barrel on ICE Futures Europe, after a third consecutive weekly rise. On Saturday, Russian Finance Minister Anton Siluanov was quoted by the TASS news agency as saying, according to Reuters: “There is a dilemma. What should we do with OPEC: should we lose the market, which is being occupied by the Americans, or quit the deal?” Siluanov said such a move could drive the price of oil to $40 a barrel or below, the report said. U.S. crude production remains in record territory, at 12.2 million barrels a day for the week ended April 5, according to recent data from the Energy Information Administration. In a monthly report issued Monday, the government agency saidcrude-oil production from seven major U.S. shale plays is forecast to climb by 80,000 barrels a day in May to 8.46 million barrels a day, from 8.38 million in April.
Oil prices tick higher, but threat of OPEC+ output hikes hangs over market -- Crude oil futures ticked higher on Tuesday after several days of back-and-forth trade, but prices remain pressured by expectations of higher U.S. inventories and concern about Russia’s willingness to stick with OPEC-led supply cuts. Brent crude, the global benchmark, was up 8 cents at $71.26 a barrel at 8:45 a.m. ET (1245 GMT). U.S. West Texas Intermediate crude gained 25 cents to $63.65. Analysts on average expect U.S. crude stockpiles to have risen by 1.9 million barrels last week, the fourth straight increase. The first of this week’s stockpile reports is due at 4:30 p.m. ET (1630 GMT) from the American Petroleum Institute. “We have already seen these inventories going higher in the last week’s print,” said Naeem Aslam, chief market analyst at TF Global Markets in London. “The rising inventory data has raised many questions for investors — no one wants to see the oil glut again.” While OPEC-led supply cuts have boosted Brent by more than 30 percent this year, gains have been limited by worries that slowing economic growth could weaken demand for fuel. Oil also fell on Monday after comments from Russia raised concern the OPEC-led supply-cutting pact may not be renewed. Russia and the producer group may decide to boost output to fight for market share with the United States, TASS news agency quoted Finance Minister Anton Siluanov as saying. OPEC and other producers including Russia, an alliance known as OPEC+, have been cutting output since Jan. 1. They decide in June whether to continue the arrangement. “There is a growing concern that Russia will not agree on extending production cuts and we could see them officially abandon it in the coming months,” said Edward Moya, senior market analyst at OANDA. Russian officials sent mixed signals over renewal of the deal with OPEC last time it was being renegotiated in December, before finally agreeing to remain on board.
Oil Bulls Undaunted By OPEC Fears - Oil prices dipped on Monday on renewed fears that OPEC+ might abandon production cuts, but prices firmed up in early trading on Tuesday. . Hedge funds and other money managers are at their most bullish so far this year, posting a fifth consecutive week of rising bullish bets on Brent crude. Short positions fell by 18 percent last week, according to Bloomberg. “There’s not many people who are willing to short this market,” Tyler Richey, co-editor at Sevens Report in Palm Beach Gardens, Florida, told Bloomberg. “We could be near a market top, but it’s just too early to tell. Right now, the path of least resistance is higher for oil.” Russia’s finance minister Anton Siluanov suggested that Russia and OPEC could fight for market share with U.S. shale, a move that would likely crash prices. “There is a dilemma. What should we do with OPEC: should we lose the market, which is being occupied by the Americans, or quit the deal?” Siluanov said at a forum in Washington. “(If the deal is abandoned) the oil prices will go down, then the new investments will shrink, American output will be lower, because the production cost for shale oil is higher than for traditional output. The government of Brazilian President Jair Bolsonaro decided to cancel a price hike on diesel last week, over concern for the impact on truckers and consumers. After cultivating a pro-business reputation, the decision spooked investors and dragged down Petrobras, which will have to shoulder the burden of regulated prices. Petrobras’ share price fell 8 percent on the news, the largest decline in 10 months.
Oil up 1 percent as market focuses on supply risks (Reuters) - Oil prices rose 1 percent on Tuesday, as fighting in Libya and falling Venezuelan and Iranian exports raised concerns over tightening global supply, but uncertainty surrounding an OPEC-led production cut limited gains. Brent crude futures rose 54 cents, or 0.8 percent, to settle at $71.72 a barrel. U.S. West Texas Intermediate (WTI) crude futures gained 65 cents, or 1 percent, to settle at $64.05 a barrel. Prices extended gains in post-settlement trade after data from industry group the American Petroleum Institute showed that U.S. crude inventories fell unexpectedly last week, dropping by 3.1 million barrels, versus analysts’ expectations of a 1.7 million-barrel build. Gasoline stockpiles fell by 3.6 million barrels, the API said, more than forecasts of a 2.1 million-barrel drop.
WTI Extends Gains After Surprise Crude Draw - WTI rebounded from a brief and unusual losing day, as investors tended towards tightening global supplies and against soaring inventories, but, as Bloomberg notes, stockpiles, already at the highest since 2017, are set to rise for a fourth week, according to a Bloomberg survey ahead of government data due Wednesday. Gasoline inventories, however, are forecast to fall for a ninth week. “Everybody’s waiting to see what happens with inventories," said Ashley Petersen, an oil analyst at Stratas Advisors LLC in New York. “We’ve run out of good news to reinforce the momentum of the market right now." API:
- Crude -3.096mm (+2.3mm exp)
- Cushing -1.561mm
- Gasoline -3.561mm - 9th draw in a row
- Distillates +2.33mm
After last week's huge drop in gasoline inventories, all eyes will be on products as expectations for 2.3mm build in crude would make it the 4th in a row, but API reported a surprise crude draw of 3.096mm barrels and gasoline continued to draw too (9th weekly draw in a row)... WTI hovered just above $64 ahead of the API print and kneejerked higher after the surprise crude draw.
WTI Unchanged After Crude Draw, Production Drop - WTI has erased the overnight gains following API's surprise crude draw despite 'good' news from China on growth overnight as all eyes are focused once again on inventories already at the highest since 2017. “As long as the products look like they’re still trending strong and it looks like demand is still there, prices will be supported," says Ashley Petersen, an analyst at Stratas Advisors. DOE:
- Crude -1.396mm (+2.3mm exp)
- Cushing -1.543mm
- Gasoline -1.174mm - 9th draw in a row
- Distillates -362k
Inventories fell across the board in the energy complex with DOE confirming (though less so) API's reported surprise crude draw and gasoline's 9th weekly draw in a row. US Crude production dipped modestly last week (and rig counts resurrected - though that will have only a lagged effect).
Oil Prices Edge Downward - All but one of the benchmarks Rigzone tracks ended the day lower. May West Texas Intermediate (WTI) futures shed 29 cents Wednesday, settling at $63.76 per barrel. The benchmark traded from $63.66 to $64.61 during the midweek session.“May WTI futures have continued to flirt and test the major resistance seen on the daily and daily continuation charts for the past week and a half,” said Steve Blair, senior account executive with the RCG Division of Marex Spectron. “This resistance lies in the $64.40 to $64.65 level. The horizontal congestion range continues to be bounded by this upper resistance and the support at the $63.00 level.” Blair added that further support for the May WTI exists at $62.63. “Until such time as the market can break out of either side of this congestion range, on a closing basis, the market will trade back and forth giving many great trading opportunities,” Blair noted.Brent crude oil for June delivery posted a more modest 10-cent loss to end the day at $71.62 per barrel.“June Brent, like May WTI, has also been trading in a horizontal congestion range during the same period as WTI,” said Blair, referencing the daily chart for Brent. “However, today prices finally broke above the congestion range, but alas, failed to close above it. And so June Brent remains in the congestion range, but showing signs that it may be ready to make a break to the upside.”If prices breakout to the upside, some minor resistance exists near the $72.50 level but major resistance would approach $75.00, Blair said.“The weekly chart, however, is showing that if prices remain at these levels that it would breakout to the upside of the range it has been in since the beginning of the year and move into another congestion range above,” added Blair.The reformulated gasoline (RBOB) contract edged upward Wednesday. Adding a penny, May RBOB settled at $2.04 per gallon. Henry Hub natural gas declined for the third consecutive trading day. May gas futures settled just under $2.52, reflecting a 5.5-cent decrease.
Oil prices rise on lower US stockpiles, OPEC+ supply cuts - Oil prices rose slightly on Thursday, boosted by a decline in U.S. inventories, ongoing supply cuts from OPEC and its allies, and U.S. sanctions on Venezuela and Iran. Brent crude futures rose 28 cents to $71.90 a barrel around 8:15 a.m. ET (1215 GMT), near Wednesday’s five-month high of $72.27 a barrel. U.S. West Texas Intermediate crude futures were up 27 cents at $64.03 per barrel. Both contracts traded slightly lower earlier in the day and were on track to post weekly gains. U.S. crude inventories fell by 1.4 million barrels in the week to April 12, U.S. Energy Information Administration data showed on Wednesday. “The latest weekly statistics on U.S. oil inventories were seemingly positive. All the major categories registered draws,” Tamas Varga of London-based oil brokerage PVM said. Gasoline stocks fell by 1.2 million barrels, and distillate stocks, which include diesel and heating oil, fell by 362,000 barrels, the EIA data showed. Prices have been supported this year by an agreement reached by OPEC and its allies, including Russia, to limit their oil output by 1.2 million barrels per day. Global supply has been tightened further by U.S. sanctions on OPEC members Venezuela and Iran. Iran’s crude exports have dropped in April to their lowest daily level this year, tanker data showed and industry sources said, suggesting a reduction in buyer interest ahead of expected further pressure from Washington. Indian refiners are turning to other OPEC members, Mexico and the United States to make up for any loss of Iranian oil.
Oil prices inch up on signs of tightening global supply - (Reuters) - Oil futures edged up on Thursday as a drop in crude exports from OPEC’s de facto leader, Saudi Arabia, and a draw in U.S. drilling rigs and oil inventories supported prices. Brent crude futures settled at $71.97 a barrel, up 35 cents from their last close and near Wednesday’s five-month high of $72.27. Brent saw a weekly gain of 0.6 percent, marking the fourth consecutive weekly rise for the international benchmark. In post-settlement trade, the contract added 4 cents to $72.01 a barrel. U.S. West Texas Intermediate (WTI) crude futures settled at $64.00 a barrel, up 24.00 cents. U.S. futures gained just under 0.2 percent for the week, their seventh weekly gain in a row. Many financial markets will be closed on Friday for public holidays. Saudi Arabia’s crude oil exports fell by 277,000 barrels to just under 7 million bpd in February from the month before, according to data from the Joint Organizations Data Initiative (JODI). U.S. crude, gasoline and distillate inventories dropped this week, with crude posting an unexpected drawdown, the first in four weeks, the Energy Information Administration (EIA) data showed on Wednesday. “I think it’s pretty clear that tightening supplies and receding fears of demand growth is a boost to the market to these five month highs,” said Gene McGillian, vice president of market research at Tradition Energy in Stamford, Connecticut. (GRAPHIC: U.S. crude inventories, weekly changes since 2017 - tmsnrt.rs/2XlX17b) U.S. energy companies this week cut the number of oil drilling rigs for the first time in three weeks as production growth forecasts from shale, the country’s largest oil fields, continue to shrink. The U.S. rig count, an early indicator of future output, fell by eight in the week ending April 18, General Electric Co’s Baker Hughes energy services firm said in its weekly report, which was released a day early because of the Good Friday holiday. (GRAPHIC: U.S. Rig count - tmsnrt.rs/2X8Myf7) Oil has been driven up this year by an agreement reached by the Organization of the Petroleum Exporting Countries and its allies, including Russia, to limit their oil output by 1.2 million bpd. Global supply has been tightened further by U.S. sanctions on OPEC members Venezuela and Iran. Iran’s crude exports have fallen in April to their lowest daily level this year, tanker data showed and industry sources said, suggesting a reduction in buyer interest ahead of expected further pressure from Washington.
Oil Heads for Weekly Loss -- Oil headed for its first weekly drop since early March as uncertainty over the future of global producer curbs, Iranian exports and U.S. inventories kept investors on edge. New York futures traded below $64 a barrel, holding a 0.5 percent loss from the previous session. While government data Wednesday showed U.S. inventories slid last week, the drop was less than half what an industry report indicated. Meanwhile, as speculation swirls over whether OPEC and its allies will extend output cuts, Asian buyers of sanctioned Iranian oil are said to be putting purchases on hold as they await a White House decision on waivers. While oil has advanced over 40 percent this year on the back of the OPEC+ coalition’s supply curbs, the rally’s run out of steam in the past couple of weeks. May could be a pivotal month for the market as the U.S. decides on whether to extend waivers allowing some countries to keep buying Iranian crude, while a meeting of the Organization of Petroleum Exporting Countries and its allies in Saudi Arabia may provide clues on future production levels. “Investors are taking a wait-and-see stance ahead of events in May, including the expiry of waivers on U.S. sanctions on Iran and the OPEC meeting,” . “It will remain difficult to make bets until May because there is so much uncertainty.” West Texas Intermediate for May delivery fell 4 cents to $63.72 a barrel on the New York Mercantile Exchange as of 7:46 a.m. in London. The contract dropped 29 cents to $63.76 on Wednesday. It’s down 0.3 percent since April 12. Both WTI and Brent won’t trade on Friday due to holidays. Brent for June settlement dropped 7 cents to $71.55 a barrel on the London-based ICE Futures Europe exchange. The contract fell 10 cents to $71.62 on Wednesday and is steady for the week. The global benchmark crude was at a premium of $7.74 to WTI for the same month. Before the EIA released its crude inventories data on Wednesday, which showed the first drop in four weeks, the API was said to report a decline of 3.1 million barrels. The median forecast in a survey of analysts by Bloomberg before the government data pointed to an increase of 2.3 million barrels in U.S. stockpiles.
The Firm Floor Under Oil Prices - Oil held steady at the close of the week, with a slowdown in U.S. shale and the looming deadline for a decision on Iran sanctions waivers putting a floor under oil prices. Schlumberger said its earnings were hit in the first quarter by the drilling slowdown in the Permian, while market conditions globally continue to improve. Schlumberger sees “higher investments in the international markets simply to keep production flat, while North America land activity is set for lower investments with a likely downward adjustment to the current production growth outlook,” according to CEO Paal Kibsgaard. “the higher cost of capital, lower borrowing capacity and investors looking for increased returns suggest that future E&P investments will likely be at levels dictated by free cash flow.” The U.S. oil industry slashed its rig count by 8 rigs this week, bringing the total down to 825. The sharp decline put an end to two consecutive weeks of increases. . President Trump spoke with the crown prince of Abu Dhabi and they talked about “contributions to the global energy markets as a reliable supplier of oil,” according to a readout of the call from the White House. Trump is expected to make a decision on Iran sanctions in the next week or two, and a hardline may require higher oil production from OPEC. Cooler than average temperatures are expected for this summer, and the U.S. could see lower electricity bills, according to the EIA. Relatedly, natural gas prices are near multi-year lows on expectations of record-breaking gas production this year.
OPEC's Production Cuts Success At Risk with $80 Oil -- After managing to revive oil prices through production cutbacks, OPEC now risks squandering its victory again by letting crude surge too high. In the first quarter, coordinated production curbs by the Organization of Petroleum Exporting Countries and its allies helped oil rally the most in almost a decade, restoring prices to over $70 a barrel. Saudi Arabia, the group’s most powerful member, has made clear that it’s determined to keep supplies tight. That risks a repeat of 2018, when production cuts propelled oil to a four-year high, provoking a backlash from President Donald Trump and a hasty reversal by the kingdom. “It appears that the producer group is over-tightening the market,” said Ed Morse, head of commodities research at Citigroup Inc. in New York. OPEC and its partners launched a new round of output cuts at the beginning of the year when it looked like booming U.S. shale-oil production and fragile global demand growth would lead to a supply surplus. But as the group implements the curbs, and as supplies are squeezed further by crises in Venezuela and Iran, there’s now a greater risk of a shortage. Supply ContractionIf the group continues with its cutbacks, global oil inventories will contract by almost 1 million barrels a day in the third quarter, the steepest drop in nearly two years, data from the organization shows. However, the group won’t make a decision whether to extend until it meets in late June. The strain on markets could go even deeper. A conflict is flaring in Libya, output is plunging in Venezuela because of a spiraling economic crisis, and the U.S. will soon decide whether to tighten sanctions on Iran’s oil exports. “OPEC is one major shutdown -- Libya, say -- from a very damaging price surge that throws all the plans out the window,” That could easily send crude prices to levels that prompt disapproval from the White House, the Saudis’ most important political ally. “There’s no doubt that in a scenario where Brent crude heads to $80, President Trump will voice his concern,”
Aramco in talks to buy stake in refining business of India's Reliance (Reuters) - Saudi Aramco, the world’s biggest oil producer, is in talks to buy a stake of at least 20 percent in the refining and petrochemicals businesses of India’s Reliance Industries Ltd, sources familiar with the matter said on Wednesday. State-owned Aramco plans to boost investments in refining and petrochemicals to secure new markets for its crude, and sees growth in chemicals as central to its downstream strategy to lessen the risk of a slowdown in oil demand. Aramco’s discussions with Reliance were for a roughly 20 percent stake, one source said, adding that the current thinking was to create an entity covering that part of Reliance’s refining, petrochemicals and marketing businesses. If the deal went ahead, it could mean a boost in Aramco’s crude oil supply to Reliance by possibly more than 50 percent, the source added. Another source said talks with Reliance were so far for a 25 percent stake. “Reliance has offered an integrated deal - a stake in existing refineries and the planned 600,000 barrels per day (Jamnagar) refinery, along with petrochemical business,” the second source said. The Times of India reported earlier that Aramco was in talks to buy a stake of up to 25 percent, which could be worth around $10-15 billion, valuing the Indian company’s refining and petrochemicals businesses at some $55-60 billion. Aramco and Reliance declined to comment. Reliance, controlled by Asia’s richest man, Mukesh Ambani, is India’s biggest refining and petrochemicals company and runs a 1.4 million bpd refining complex at Jamnagar in western India. It plans to expand capacity to 2 million bpd by 2030, according to plans shared with the Indian government. Last year, Aramco and the United Arab Emirates’ national oil company ADNOC teamed up with state-run Indian refiners in a plan to build a 1.2 million bpd refinery and petrochemical project in Maharashtra state. However, the planned refinery, which was initially expected to cost $44 billion, faces delays, as thousands of farmers have refused to surrender land for it and the Maharashtra government is looking to move the plant’s location. Saudi Crown Prince Mohammed bin Salman visited India in February and said then that he expected investment opportunities worth more than $100 billion there over the next two years.
Over 70,000 Killed in Yemen War Since 2016 - Official figures on the deaths in the Yemen War have been virtually unavailable, or at least years out of date. The database tracker from the Armed Conflict and Location Event Data Project, however, issued their own data on Yemen Thursday, showing more than 70,000 have been killed in Yemen just since January 2016.This is a huge amount of deaths, and if there is some decrease in fighting in Hodeidah because of UN talks, it’s not like the war is slowing much. At least 10,000 people were killed just in the past five months.The decline in Hodeidah was made up for by substantial increases in fighting in Taiz and Hajjah. Stopping the fighting in Hodeidah was still important, since it prevented a famine that could’ve killed even more people, but the combatants have largely just started fighting elsewhere. The database included 3,155 direct attacks targeting civilians, with more than 7,000 civilians killed. Unsurprisingly, the vast majority of the civilians were killed by the Saudi-led coalition, at least 4,800, while the Houthis killed about 1,300 civilians.
Secret Report Reveals Saudi Incompetence and Widespread Use of U.S. Weapons in Yemen - Since the brutal murder of Saudi dissident and Washington Post contributor Jamal Khashoggi last October, Congress has increasingly pressured the Trump administration to stop backing the Saudi Arabia-led coalition fighting in Yemen and halt U.S. arms sales to Riyadh. In response, President Donald Trump has repeatedly said that if the U.S. does not sell weapons to the Saudis, they will turn to U.S. adversaries to supply their arsenals.“I don’t like the concept of stopping an investment of $110 billion into the United States,” Trump told reporters in October, referring to a collection of intent letters signed with the Saudis in the early months of his presidency. “You know what they are going to do? They’re going to take that money and spend it in Russia or China or someplace else.” But a highly classified document produced by the French Directorate of Military Intelligence shows that Saudi Arabia and the United Arab Emirates are overwhelmingly dependent on Western-produced weapon systems to wage their devastating war in Yemen. Many of the systems listed are only compatible with munitions, spare parts, and communications systems produced in NATO countries, meaning that the Saudis and UAE would have to replace large portions of their arsenals to continue with Russian or Chinese weapons. “You can’t just swap out the missiles that are used in U.S. planes for suddenly using Chinese and Russian missiles,” “It takes decades to build your air force. It’s not something you do in one fell swoop.” The Saudi-led bombing campaign in North Yemen primarily relies on three types of aircraft: American F-15s, British EF-2000 Typhoons, and European Tornado fighters. The Saudis fly American Apache and Black Hawk helicopters into Yemen from military bases in Saudi Arabia, as well as the French AS-532 Cougar. They have lined the Saudi-Yemen border with American Abrams and French AMX 30 tanks, reinforced by at least five types of Western-made artillery guns. And the coalition blockade, which is aimed at cutting off aid to the Houthi rebels but has also interfered with humanitarian aid shipments, relies on U.S., French, and German models of attack ships with, as well as two types of French naval helicopters.
Leaked Docs Show Saudis 'Overwhelmingly Dependent' on Western Weapons to Wage War on Yemen - Leaked documents from France's military agency "show that Saudi Arabia and the United Arab Emirates are overwhelmingly dependent on Western-produced weapon systems to wage their devastating war in Yemen," The Intercept reported Monday. The report was obtained by the French investigative news organization Disclose, and published in full Monday by The Intercept, Disclose, and four other French media outlets.An unprecedented leak of secret documents has revealed the massive use of French-made and US-made weapons in the ongoing civil war in Yemen. #yemenpapers #publicinterest@theintercepthttps://t.co/KGutpo7Nal— Disclose.ngo (@Disclose_ngo) April 15, 2019DRM produced the 15-page report for an October meeting of top French officials that included French President Emmanuel Macron, Minister of the Armed Forces Florence Parly, and Minister of European and Foreign Affairs Jean-Yves Le Drian. As The Intercept explained: The Saudi-led bombing campaign in North Yemen primarily relies on three types of aircraft: American F-15s, British EF-2000 Typhoons, and European Tornado fighters. The Saudis fly American Apache and Black Hawk helicopters into Yemen from military bases in Saudi Arabia, as well as the French AS-532 Cougar. They have lined the Saudi-Yemen border with American Abrams and French AMX 30 tanks, reinforced by at least five types of Western-made artillery guns. And the coalition blockade, which is aimed at cutting off aid to the Houthi rebels but has also interfered with humanitarian aid shipments, relies on U.S., French, and German models of attack ships... as well as two types of French naval helicopters. In addition to the U.S., the U.K., and France, the report mentions radar and detection systems from Sweden; Austrian Camcopter drones; defensive naval rockets from South Korea, Italian warships, and even rocket launcher batteries from Brazil.
Iran's Parliament Passes Vote Declaring US Central Command A Terror Organization - Following Monday's formal US listing of Iran's Islamic Revolutionary Guard Corps (IRGC) as a Foreign Terrorist Organization, or FTO, Iran was quick to hit back as previously promised. Iranian lawmakers voted Tuesday to in turn list US Central Command, or CENTCOM, as a terrorist organization, which means that any support given CENTCOM will be treated as an act of terrorism. It essentially means all American troops in the Middle East will be treated as terrorists, according to the newly passed law. “The Islamic Republic of Iran’s government and Armed Forces are required to adopt preventive actions and preemptive defensive measures whenever necessary, to deter any hostile US forces’ use of any possibilities against the Islamic Republic of Iran’s interests,” the bill states, according to Fars news. It passed with a near unanimous vote in parliament, taking effect immediately, and includes 13-article legislation which mandates the armed forces to gather intelligence about CENTCOM activities. Such material could be used to prosecute either individuals or foreigners giving any level of assistance to the US military in the Middle East. CENTCOM covers the Middle East and Central Asia, and coordinates command of all US armed forces in places like Afghanistan and Iraq — both of which hold major potential for clashing up against Iranian forces or proxies, especially true of Iraq. Iran's Defense Minister Amir Hatami said this week that Washington's moving forward with the FTO designation of the IRGC is proof that sanctions on Tehran were failing. During remarks made early last week when President Trump first unveiled his intent to designation the IRGC, he said, “This designation will be the first time that the United States has ever named a part of another government as an FTO,” and added, “This action sends a clear message to Tehran that its support for terrorism has serious consequences. We will continue to increase financial pressure and raise the costs on the Iranian regime for its support of terrorist activity until it abandons its malign and outlaw behavior.”
Former ISIS Commanders Rehabilitated as Traffic Cops in Syria Under US Watch — Locals of Ein Issa, a Syrian town just north of the city of Raqqa are reportedly fed up with former ISIS members and commanders who have been rehabilitated by U.S. proxy forces as traffic cops.“Reliable sources” told the Syrian Observatory for Human Rights (SOHR) that former Daesh militants have been converted into “security members” and are extorting the public.The rehabilitated ISIS fighters are reportedly “imposing bribes” and royalties on vehicles, “not to mention the shameful acts against the pedestrians in the streets and the harassment of the citizen women.” Earlier this year, according to the same outlet, American generals met with “administrative representatives” in the town. SOHR is run by a single individual living in the U.K., Rami Abdulrahman, a man with pro-opposition sympathies. The outlet is funded by the British Home Office. Typically in the aftermath of war, the losers are severely punished — especially snipers, and ISIS had many. Extrajudicial killings against suspected ISIS members have run rampant in Iraq and Syria, as citizens release their rage over being held captive for so many years. It is no surprise that the citizens of Raqqa and its suburbs, who are mostly Sunni Arabs, are incensed that former ISIS members, whom they may even recognize, are allowed to continue issuing traffic tickets and harassing women.
Israel Launches Overnight Airstrikes On Syria Just After Netanyahu's Re-election - Earlier this morning, the Israeli Air Force launched several airstrikes on the key Syrian city of Masyaf in the Hama Governorate. According to a military source near the scene of the airstrikes, the Israeli warplanes hit a number of sites near the Masyaf National Hospital. The source said the Israeli airstrikes targeted some of the military storages in Masyaf; this resulted in several loud explosions that could be heard as far east as Hama city. He added that the S-300 system was not in use during the Israeli attack.Masyaf is an important city because it is considered headquarters of the Tiger Forces and several other military units. The S-300 system has also been installed around the city. The Syrian Observatory for Human Rights said the strike killed several Iranian fighters and wounded 17 Syrian troops and their allies https://t.co/vZmboFJnHc— The New Arab (@The_NewArab) April 13, 2019
US Issues New Map Showing Golan Heights as Israeli Territory — The US has issued a new map showing the occupied Syrian Golan Heights as Israeli territory, just three weeks after US President Donald Trump announced he would recognize the region as belonging to Israel. The US’ Special Representative for International Negotiations, Jason Greenblatt, yesterday tweeted a picture of the new map with the words “welcome to the newest addition of our international maps system after [President Trump] issued a proclamation recognizing Israeli sovereignty over the Golan Heights.” The map shows the 1974 ceasefire line between Israel and Syria – which was imposed after Israel captured the Syrian Golan Heights in the Six Day War of 1967 and reaffirmed after the 1973 October War – as a permanent border, using a solid line as opposed to the dashes usually used to demarcate such armistice lines. In contrast, the other armistice lines separating Israel from Lebanon, the occupied West Bank and besieged Gaza Strip are still shown with dashed lines. The move represents further entrenchment of Trump’s decision in March to recognize the Golan Heights as Israeli. In a tweet, President Trump wrote: “After 52 years it is time for the United States to fully recognize Israel’s Sovereignty over the Golan Heights, which is of critical strategic and security importance to the State of Israel and Regional Stability!” His decision reversed years of official US policy which, in line with international law, designated the Golan as “Israeli controlled.” President Trump’s decision was slammed by the international community, with Turkey,Saudi Arabia, Iran, the Arab League and Russia all lambasting the move. A week later, Israeli Prime Minister Benjamin Netanyahu visited Washington DC to attend the signing of an official proclamation of the US’ new policy on Golan. Netanyahu praised the decision, saying “just as Israel stood tall in 1967, just as it stood tall in 1973, Israel stands tall today. We hold the high ground and we should never give it up.” The announcement was seen as a gift to Netanyahu before Israel’s general election on 9 April. Throughout his re-election campaign, Netanyahu repeatedly emphasized his strong relationship with Trump, claiming to have “got things done” during his premiership and won a number of “successes” such as moving the US embassy to Jerusalem and the recognition of the Holy City as Israel’s capital.
Israeli Settler Kills Palestinian Woman After Ramming Her With Car, Soldiers Shoot And Seriously Injure Teen -- A Palestinian woman was killed, earlier Thursday morning, near her home in Teqoua’ town, southeast of Bethlehem in the occupied West Bank, after being rammed by the car of an illegal colonialist settler. The soldiers later shot and seriously injured a Palestinian teen while handcuffed, when he reportedly attempted to escape. The slain Palestinian woman has been identified as Fatima Suleiman, 42. According to eyewitnesses, the assailant was driving a large truck when he struck the woman’s car, throwing her out of the vehicle, and then rammed and killed her, before fleeing the scene. The slain Palestinian woman was a teacher at the Rashayda School. The Israeli Police did come to the scene, but only to remove all security camera footage from a house overlooking the area where the incident took place. The incident led to protests as dozens of residents, mainly youngsters, took to the streets, and hurled stones at the Israeli army jeeps, while the soldiers attacked them with live fire, rubber-coated steel bullets and gas bombs. The soldiers then detained a Palestinian teen, before handcuffing and blindfolding him, and later shot him from a very close range, after he attempted to escape while he was still cuffed and blindfolded. The shooting took place following the funeral procession of the Palestinian woman. A picture was posted on social media showing the young man, who was cuffed and blindfolded trying to run away, before the soldiers shot him. A video posted on social media shows the teen on the ground when witnesses lifted the teen’s limp body, bleeding heavily, carrying him from the scene, as the Israeli soldier stood pointing the same pistol at another young Palestinian man.
13th century Palestinian mosque converted into 'bar and event halls' -- A centuries-old Palestinian mosque has been converted into a bar and events hall, according to Gulf News, quoting Al-Quds Al-Arabi on Wednesday.The historic mosque changed from Al-Ahmar (Red) mosque to Khan al-Ahmarin an occupied Palestinian town in the northern Safed district of Israel experienced a series of desecrations since 1948.First, the mosque was converted into a Jewish school, then in 2006, it became a campaign center for the Israeli Kadima Party, before being used as a clothing shop and now a bar and a wedding hall.Khair Tabari, secretary of a Palestinian Islamic endowment agency ‘Safed and Tiberias Islamic Endowment’ has been trying to rescue the mosque for years.“I was shocked when I saw aspects of sabotage inside the mosque,” Tabari, told London-based newspaper Al Qodus Al Arabi. “I felt dizzy when I noticed the vandalism inside the mosque, as can be seen by the remains of Qu’ranic verses which were removed from the pulpit and replaced by the Ten Commandments in Hebrew,” Tabari told al-Quds al-Arabi. According to Dr. Mustafa Abbasi, a historian and a native of Safad, the mosque was built in 1276, has great historical and architectural value. “Al Ahmar Mosque derives its name from its red stones. Today, it is used in several ways except as a prayer place for Muslims,” said Abbas.“Muslims visiting the place face attacks from Jewish colonists,” he added. “The mosque has a rare historical and architectural value as it was established by the Mameluke Sultan Al Daher Baibars [1223-1277 AD),” Abbas said. The other historical mosques, cemeteries and other religious sites have similar stories. They are either converted into nightclubs or blew up. The Greek mosque, built in 1319, was transformed into an art gallery where praying is forbidden.
Blaze Erupts at Jerusalem’s Historic al-Aqsa Mosque as Notre Dame Burns (VIDEO) Notre Dame de Paris wasn't the only beloved house of worship that caught fire Monday. Part of the Haram ash-Sharif, the huge Jerusalem mosque built where a pivotal event in the prophet Muhammad's life is believed to have occurred, also caught fire, damaging a part of the structure dating to Judean King Herod the Great's reign. The fire broke out in the guard room outside the al-Marwani Prayer Room Monday evening, according to a statement by the mosque's Islamic Waqf (Endowments) Department. According to The New Arab, a guard reported a short gap in guard rotations between 7:15 and 7:30 p.m. local time. The waqf department praised the responsiveness of staff firefighters, who quickly put out the blaze. The fire seems to have been started by children fooling around, and the waqf's statement urged worshipers "who live around the mosque and in the Old City to educate their children not to tamper with fire, especially inside al-Aqsa mosque." Israeli police told al-Araby they were opening an investigation into the incident. Israel has governed the entire city since 1967, when it seized the territory from Jordan. The United States has recently recognized Israel's claim that Jerusalem is its capital, but few nations have followed suit, with most sticking by the many United Nations resolutions condemning Israel's annexation of the territory. Al-Aqsa means "the farthest" in Arabic; a house of worship was built in the site because of a verse in the Quran describing the prophet Muhammad's "Night Journey," which says he went to the farthest mosque before ascending to heaven atop a flying horse named Buraq ("lightning, in Arabic). It's unclear which caliph founded the modern structure, but it was almost certainly built in the late seventh century and steadily expanded ever since.
Europe urged to reject US Middle East plan if it is unfair to Palestinians -High-ranking former European politicians have condemned the Trump administration’s one-sided Israel-Palestine policy and called in a letter for Europe to reject any US Middle East peace plan unless it is fair to Palestinians. The letter, sent to the Guardian, the EU and European governments, was signed by 25 former foreign ministers, six former prime ministers, and two former Nato secretary generals.“It is time for Europe to stand by our principled parameters for peace in Israel-Palestine,” read the letter, calling for a two-state solution in which Israel and Palestinian states live side by side. Europe, it said, should reject any plan that does not create a Palestinian state alongside Israel with Jerusalem as the capital for both countries. “Unfortunately, the current US administration has departed from longstanding US policy,” it said, criticising Donald Trump’s 2017 recognition of “only one side’s claims to Jerusalem”. Washington had also “demonstrated a disturbing indifference to Israeli settlement expansion” in the occupied West Bank and cut hundreds of millions of dollars in aid to Palestinians, a move the letter said was “gambling with the security and stability of various countries located at Europe’s doorstep”. Since taking office, and amid praise from Israel’s government, Trump has taken measures seen as both punishing to Palestinians and which also stifle the viability of a Palestinian state. The US president has promised to unveil a still-secret “ultimate deal” for Israelis and Palestinians, although the Palestinian leadership preemptively rejected it as biased, and Israel’s leader, Benjamin Netanyahu, categorically ruled out a Palestinian state. The US team tasked with drafting the plan includes Trump’s son-in-law, Jared Kushner, and the US ambassador to Israel, David Friedman, a bankruptcy lawyer who has been vocal in his support for Jewish settlements in the Palestinian territories.
Libya- Detained refugees 'terrified' as clashes near Tripoli rage - As fighting between rival forces rages on the outskirts of the Libyan capital, thousands of refugees and migrants locked up in detention centres inside Tripoli say they are terrified of what might happen to them. Renegade General Khalifa Haftar on Thursday ordered his self-styled Libyan National Army (LNA), which is allied to a parallel administration in the east, to march on Tripoli, the seat of the country's internationally recognised government which is protected by an array of militias. Despite international calls for a truce, clashes have intensified, with dozens of people killed on both sides since the fighting began. In recent days, Al Jazeera contacted detainees in several migrant detention centres across Tripoli. The detainees, who use hidden phones to communicate, asked that their names not be published for fear of retaliation. Some of the detention centres are also not named to protect the detainees' identities. Their statements could not be independently verified, but they offered similar accounts. Some of the refugees and migrants said they had been left without food or water, including hundreds in the middle of an active conflict zone. Others said they had been taken from their cells and forced to move weapons. "We can see the military," said a man in Qasr bin Ghashir detention centre, on the southern outskirts of Tripoli, in an area where clashes are ongoing. Speaking to Al Jazeera on Sunday, he said hundreds of refugees and migrants being held there had not had any food in two days. "The food store is empty," he said. "The war is still continuing. Even the electricity and water supply stopped." Two men wearing military outfits reportedly arrived to tell Qasr bin Ghashir's detainees, including children, they would be moved to a safe place - but those being held there were worried the men were traffickers or smugglers who might take them for ransom. "Maybe they'll take us to sell us," said one man, who sent recordings in which loud explosions could be heard.
Turkish Ambassador Denies Report Claiming Ankara Sent ISIS Fighters to Libya– Turkish Ambassador to Tunisia Ömer Faruk Doğan has denied a Tunisian news report accusing Ankara of sending Islamic State in Iraq and the Levant (ISIL) terrorists to the Libyan capital of Tripoli from Syria, the state-run Anadolu news agency reported.In a statement, Doğan described the report by private newspaper Al-Chourouk as “lies.”The source “did not verify the authenticity of the information, which was built on false statements,” the diplomat stressed. The Tunisian daily cited statements by Ahmad al-Mesmari, a spokesman for east Libyan-based forces, in which he claimed that there were “open lines” to provide weapons and fighters from Turkey and Malta to the Tripoli-based government.“The baseless allegations do not serve peace in the region, nor Tunisian-Turkish relations, but weaken them, especially at a time when the entire region needs solidarity,” Doğan said.The Turkish envoy warned that such reports “mislead Tunisian public opinion, to which we attach great importance.”“Turkey has always defended the stability of Libya, which it considers a brotherly country like Tunisia, with both of which Turkey shares a common culture and history,” he said. “Turkey has always maintained close ties with Libya and feels that political dialogue is the solution,” the diplomat stressed.
Trump Thanks Gen. Haftar For Securing Libya’s Oil Resources Amid Tripoli Fighting -In a sharp reversal of longstanding US policy which recognizes only the UN-backed Government of National Accord (GNA) in Tripoli as the legitimate authority over Libya, the White House on Friday said President Trump spoke by phone this week to Benghazi based commander Kalifa Haftar, pledging support to the general and his Libyan National Army (LNA) as it lays siege to the capital. The White House statement said Trump “recognized Field Marshal Haftar’s significant role in fighting terrorism and securing Libya’s oil resources, and the two discussed a shared vision for Libya’s transition to a stable, democratic political system.” The call took place on Monday, but was only revealed at the end of this week amid ongoing fighting in and around Tripoli, under assault for the past two weeks by Haftar's forces, which early this month led to the withdrawal of a contingency of US Marines, citing the deteriorating security situation. The White House readout said the two discussed “ongoing counterterrorism efforts and the need to achieve peace and stability in Libya.”Interestingly in early April Secretary of State Mike Pompeo had urged in a statement for Haftar to halt his advance: “We have made clear that we oppose the military offensive by Khalifa Haftar’s forces and urge the immediate halt to these military operations against the Libyan capital,” Pompeo said at the time. Haftar — who solidified control of Eastern Libya over the past two years and swept through the south in January, seeks to capture Tripoli and seize military control of the entire country, and has over the past weeks made inroads into the capital.
Libya – U.S. Reveals Support For Hafter’s Side -The situation on the ground in Libya has changed little since we last looked at it two weeks ago. The Libyan National Army (LNA) troops of General Hafter attack the militias which support the UN recognized government in Tripoli from the south. The LNA still lacks forces for a larger break through. Several objects at the front changed hands several times. There are bloody skirmishes but no big fights. Those are still to come. Some people doubt that Hafter can be successful: Analysts believe that Haftar over-estimates the strength of his LNA. They say the controversial field marshal, who backs an administration rival to the GNA based in eastern Libya, was counting on a quick collapse of Tripoli militias. But pro-GNA reinforcements from around Tripoli rushed to assist in driving back his forces. It was never clear if Hafter really hoped that a lightning attack on Tripoli would achieve a fast victory, or if his sudden move was intended to rally support from outside. He is now certainly getting such support and that will be to his decisive advantage in the longer play. As we described it:Hafter has open support from France, the UAE, Saudi Arabia, Egypt and Russia. The Trump administration is not interested to step into the mess. Hafter is an old CIA asset and if he takes control there is a good chance that the U.S. will have influence over him. As long as Libyan oil flows and keeps the global oil price down Trump will be happy. Russia is trying to stay in the background to not give the anti-Russian forces in Washington an excuse to intervene. The Muslim Brothers, supported by Turkey and Qatar, are still in play in Misrata but have otherwise lost their influence on the ground.Since then the Wall Street Journal reported that Saudi Arabia pledged tens of millions of dollars to support Hafter's move on Tripoli. During the last week Hafter visited President Sisi of Egypt. Europe is disunited over the issue. Italy wants to keep its influence in its former colony Libya and its historical position in the Libyan oil industry. It is also concerned about a new wave of refugees. It supports the government in Tripoli. France is supporting Hafter with an eye on taking over some oil business. It is also concerned about Islamist activities in former French colonies west and south of Libya. With Italy and France in a clinch, the European Union only issued a weak statement that called for a stop of fighting without naming any side.
Death toll in Libya fighting continues to rise- Clashes between rival militias fighting for control of the Libyan capital, Tripoli, has killed at least 213 people and wounded more than 1,000 others, the United Nations' health agency said on Friday.In a tweet containing the updated death toll from more than two weeks of fighting, the World Health Organization also warned against attacks on civilians, health workers and health facilities, saying they were "not a target."Fighting erupted in Libya after Khalifa Haftar, who commands the self-styled Libyan National Army, ordered his troops to launch an offensive on Tripoli to oust a UN-backed government on April 4.Haftar, who supports a rival administration in the east of the country, has seized growing control of southwestern Libya in recent months. He has rejected calls to call off his offensive, which has raised fears of renewed civil conflict.Later on Friday, the White House said US President Donald Trump had called Haftar earlier in the week to acknowledge "Field Marshal Haftar’s significant role in fighting terrorism and securing Libya’s oil resources, and the two discussed a shared vision for Libya’s transition to a stable, democratic political system."The call came amid efforts by the UN to broker a ceasefire. On Thursday, the US and Russia opposed a UN ceasefire bid that was backed by the United Kingdom, France and Germany. Libya has been in political turmoil since the ouster and killing of long-time dictator Moammar Ghadafi in a NATO-back uprising in 2011.
Sudan coup: Military leader vows to ‘uproot regime’ The leader of Sudan's interim military council has vowed to "uproot the regime" two days after a military coup. Speaking on TV, Lt-Gen Abdel Fattah Abdelrahman Burhan announced the restructuring of state institutions, the end of a night curfew and the release of political prisoners. Protests continue despite the ousting of long-time leader Omar al-Bashir. Demonstrators have demanded an immediate move to civilian rule and vow to stay in the streets. Gen Burhan, who replaced the coup leader after he resigned on Friday, also dissolved all provincial governments and pledged respect for human rights. The army would maintain "peace, order and security" across Sudan during an already announced transition period that would last at most two years until elections could be and civilian rule introduced, he added. Using a more conciliatory tone, Gen Burhan also called on the opposition to "help us restore normal life", promised to try those who killed demonstrators and vowed a war on corruption. The speech followed the resignation of feared security chief Gen Salah Gosh hours after the coup leader himself, Defence Minister Awad Ibn Auf, stepped aside. No official reason has been given for either departure. Later on Saturday the army named Lt Gen Mohamed Hamdan Dagalo as the deputy head of the Transitional Military Council. Known by the nickname "Hemeti", the general commands the paramilitary Rapid Support Force (RSF), which grew out of the government-backed Janjaweed militia. The Janjaweed are accused of carrying out atrocities in the western region of Darfur in the early 2000s.
Inside The US-Led Operation To Bust North Korean Oil Smugglers On The High Seas - For the first time details of an extensive anti-smuggling surveillance operation involving eight United Nations member countries in the East China Sea, in waters near China and North Korea, have been revealed by a new Wall Street Journal investigation. WSJ reporters accompanied the USS Milius and an allied Japanese warship, cooperating further with military surveillance aircraft, on a mission to thwart sanctions busting illegal oil transfers on the high seas to North Korean tankers. The stunning report provides a first hand account of in some instances Chinese ships turning off their transponders ("ghosting" international trackers) to covertly transfer petroleum products to North Korean bound tankers on the open waters. One dramatic episode involved the US warship intercepting a cluster of 3 "ghosting" ships pulling near a UN-blacklisted tanker known for illegal smuggling operations into North Korea:One of the two smaller ships began to quickly move away from the group as the other loosened its mooring to the tanker. Both of the smaller ships carried Chinese flags. No flag was visible on the tanker. The Milius’s commanding officer, Cmdr. Jon Hopkins, set a course to pull alongside the tanker. “We got them,” said a Milius crew member on lookout duty. The United Nations over a year ago imposed tight limits on North Korea's ability to import oil and petroleum products due to its banned nuclear testing and missile program.
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