oil prices at a 7 year high; oil supplies at a 10 year low; total oil & products supplies at 7 1/2 year low..

oil prices at a new 7 year high, oil supplies at a new 10 year low; SPR at a new 19 year low; total oil & products supplies at 7 1/2 year low; Omicron's hit to demand leads to largest 5 week increase of gasoline inventories in 32 years

Oil prices rose for a seventh straight week and hit a new 7 year high for the third straight week on fears of production well freeze-offs and on OPEC+​s​ decision ​to limit​ their March increase in production…after rising 2% to $86.82 per barrel last week on heightened tension over Ukraine, tight supplies, and perceptions of rising demand, the contract price for US light sweet crude for March delivery opened 63 cents higher on Monday amid concerns over tight supply and geopolitical tensions​,​ but backed off to turn negative in late morning trading before rallying through the afternoon on a report that oil inventories held on tankers had fallen​ by 20% last week to close $1.33 higher at $88.15 a barrel, ​thus ​finishing the month 17% higher, the biggest January gain in 30 years, as robust demand ​continued to ​outpace fresh supply.....oil posted modest losses early Tuesday, as traders looked for clues on OPEC's plans to release more supplies into a tightening oil market, but recovered to settle 5 cents higher at $88.20 a barrel​,​ as traders bet supplies would stay tight, following a limited production hike by major oil producers and a strong post-pandemic recovery in fuel demand...oil prices then spiked to a 7 year high of $89.72 a barrel early Wednesday after the EIA​'s​ report confirmed the surprise inventory draw reported by the API overnight, but then moved lower despite that​ draw​, as the EIA also reported refiners ​had ​sharply reduced run rates amid softer demand for gasoline, while domestic oil production fell for the second consecutive week, before recovering to settle 6 cents higher at $88.26 a barrel, after the 23-nation producer's cartel led by OPEC rubber-stamped the nominal ​output ​increase of 400,000 barrels ​per day for March...oil prices moved down nearly 2% early Thursday after payroll processor ADP reported a loss of 310,000 jobs in January, but reversed to trade sharply higher in afternoon trading on a rapidly weakening U.S. dollar index, and on a potential for wellhead freeze-offs in the Texas and Oklahoma oilfields, as a potent winter storm laid siege to a large swath of the country, to finish $2.01 higher at $90.27 a barrel, the first closing price above $90 since 2014....the price rally continued into Friday, fueled by the potential for widespread oil and gas wellhead freeze-offs in the Permian Basin due to subzero temperatures brought about by Winter Storm Landon, with oil topping $93 after the Labor department reported surprisingly large jobs gains, before settling $2.04 higher at $92.31 a barrel, its highest finish since September 29 2014, while ending up 6.3% on the week...

With oil prices ​closing at the third 7 year high​ in a row​ this week, we'll ​again ​include ​a long term graph ​of that price spike ​here:

The above is a screenshot of the current interactive​ and continuously updated​ oil price chart from barchart.com, which i have set to show front month oil prices monthly over the past 10 years, which means you're seeing the same range of oil prices that were quoted by the media over that stretch....this interactive chart can also be reset to show prices of front month or individual monthly oil contracts over time periods ranging from 1 day to 30 years, as the menu bar on the top indicates, and also to show oil prices by the minute, hour, day, week or month for each...each bar in the graph above represents the range of oil prices for a single month, with months when prices rose indicated in green, with the opening price at the bottom of the bar and the closing price at the top, and months when prices fell indicated in red, with the opening price at the top of the bar and the closing price at the bottom, while the small sticks above or below each monthly bar represent the extent of the price change above or below the opening and closing price during the month in question....meanwhile, the bars across the bottom show trading volume for the front month oil contract for the months in question, again with up months indicated by green bars and down months indicated in red...​the little green bar at the far left represents oil prices for the first six days of February and doesn't highlight Friday's closing price because i created this graph after trading in US oil contracts had already resumed in Asia, and hence shows the March WTI price as of the most recent trade.....

On the other hand, natural gas prices finished a bit lower amid the greatest price volatility in 26 years after last week's big ​price ​spike, as traders looked past th​e current​ winter storm to warmer forecasts next week​...after rising 22.7% to $4.639 per mmBTU last week on short covering as the February gas contract expired, the contract price of natural gas for March delivery opened higher on Monday and pushed to an 8% increase before settling with a 23.5 cent gain at $4.874 per mmBTU, following a fierce winter storm in the East and ahead of another storm and ​expected ​deep freeze that ignited fears of production shutdowns....after opening higher on Tuesday, gas prices turned south to finish 12.3 cents lower at 4.751 per mmBTU, as weather forecasts lowered the intensity of​ the​ frigid weather expected in Texas later in the week... ​but ​a biting February forecast, potential supply disruptions and robust export demand, combined with a short squeeze sent natural gas prices 75.0 cents or nearly 16% higher to $5.501 per mmBTU on Wednesday, only to see prices tumble 61.3 cents or more than 11% to $4.888 per mmBTU on Thursday, on a slightly smaller-than-expected storage draw and on forecasts for less cold and lower heating demand over the next two weeks than had been expected....natural gas prices tumbled again on Friday, falling 31.6 cents or nearly 7% to $4.572 per mmBTU, on less cold forecasts, even as a massive storm battered much of the country from Texas to New York, cutting gas output to its lowest level since 2021's February freeze, and thus finished 1.4% lower for the week..​.​

The EIA's natural gas storage report for the week ending January 28th indicated that the amount of working natural gas held in underground storage in the US fell by 268 billion cubic feet to 2,323 billion cubic feet by the end of the week, the largest gas storage withdrawal since February 19th of last year, which left our gas supplies 393 billion cubic feet, or 14.5% below the 2,716 billion cubic feet that were in storage on January 28th of last year, and 143 billion cubic feet, or 5.8% below the five-year average of 2,466 billion cubic feet of natural gas that have been in storage as of the 28th of January over the most recent five years....the 2​68 billion cubic foot withdrawal from US natural gas working storage for the cited week was actually less than the average forecast for a 277 billion cubic foot withdrawal in a Reuter's poll of analysts, but was quite a bit more than the 183 billion cubic feet that were pulled from natural gas storage during the corresponding week of 2021, and also way more than the average withdrawal of 150 billion cubic feet of natural gas that have typically been pulled out natural gas storage during the same week over the past 5 years…   

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending January 28th indicated that despite a jump in our oil imports and a drop in our oil exports, a major reversal from unaccounted for supply to unaccounted for demand meant we had to pull oil out of our stored commercial crude supplies for the eighth time in 10 weeks and for the 24th time in the past thirty-six weeks….our imports of crude oil rose by an average of 849,000 barrels per day to an average of 7,085,000 barrels per day, after falling by an average of 509,000 barrels per day during the prior week, while our exports of crude oil fell by an average of 420,000 barrels per day to an average of 2,376,000 barrels per day during the week, which together meant that our effective trade in oil worked out to a net import average of 4,709,000 barrels of per day during the week ending January 28th, 1,269,000 more barrels per day than the net of our imports minus our exports during the prior week…over the same period, production of crude oil from US wells was reportedly 100,000 barrels per day lower at 11,500,000 barrels per day, and hence our daily supply of oil from the net of our international trade in oil and from domestic well production appears to have totaled an average of 16,209,000 barrels per day during the cited reporting week…

Meanwhile, US oil refineries reported they were processing an average of 15,248,000 barrels of crude per day during the week ending January 28th, an average of 248,000 fewer barrels per day than the amount of oil that our refineries processed during the prior week, while over the same period the EIA’s surveys indicated that a net of 417,000 barrels of oil per day were being pulled out the supplies of oil stored in the US….so based on that reported & estimated data, this week’s crude oil figures from the EIA appear to indicate that our total working supply of oil from net imports, from storage, and from oilfield production was 1,377,000 barrels per day more than what our oil refineries reported they used during the week…to account for that disparity between the apparent supply of oil and the apparent disposition of it, the EIA just inserted a (-1,377,000) 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 balance sheet fudge factor that they label in their footnotes as “unaccounted for crude oil”, thus suggesting there must have been a error or omission of that magnitude in this week’s oil supply & demand figures that we have just transcribed...moreover, since last week’s EIA fudge factor was at (+617,000) barrels per day, that means there was a 1,994,000 barrel per day difference between this week's balance sheet error and the EIA's crude oil balance sheet error from a week ago, and hence the week over week supply and demand changes indicated by this week's report are completely worthless.....however, since most everyone treats these weekly EIA reports as gospel and since these figures often drive oil pricing, and hence decisions to drill or complete oil wells, we’ll continue to report this data just as it's published, and just as it's watched & believed to be reasonably accurate by most everyone in the industry...(for more on how this weekly oil data is gathered, and the possible reasons for that “unaccounted for” oil, see this EIA explainer)….

This week's 417,000 barrel per day decrease in our overall crude oil inventories left our total oil supplies at 1,004,055,000 barrels, the lowest since January 13th, 2012, and hence at a 10 year low...this week's oil inventory decrease came as 149,000 barrels per day were being pulled out of our commercially available stocks of crude oil, while 267,000 barrels per day of oil were being pulled out of our Strategic Petroleum Reserve, part of the first installment of Biden's plan to release 50 million barrels from the SPR, in order to incentive continued use of US gas guzzlers....including the drawdowns from the Strategic Petroleum Reserve under such politically motivated programs, a total of 67,235,000 barrels have been removed from the Strategic Petroleum Reserve over the past 18 months, and as a result the amount of oil left in our Strategic Petroleum Reserve has fallen to the lowest since October 25th, 2002, or to another new 19 year low of 588,912,000 barrels per day, as repeated tapping of our emergency supplies for political reasons or to “pay for” other programs had already drained those supplies considerably over the past dozen years...based on an estimated prepandemic consumption level of around 18 million barrels per day, the US will have roughly 30 1/2 days of oil supply left in the Strategic Petroleum Reserve when the Biden program is complete...

Further details from the weekly Petroleum Status Report (pdf) indicate that the 4 week average of our oil imports rose to an average of 6,534,000 barrels per day last week, which was 9.6% more than the 5,964,000 barrel per day average that we were importing over the same four-week period last year….this week’s crude oil production was reported to be 100,000 barrels per day lower at 11,500,000 barrels per day because the EIA's rounded estimate of the output from wells in the lower 48 states was 100,000 barrels per day lower at 11,100,000 barrels per day, while Alaska’s oil production was 5,000 barrels per day lower at 443,000 barrels per day and had no impact on the rounded national production total...US crude oil production had reached a pre-pandemic high of 13,100,000 barrels per day during the week ending March 13th 2020, so this week’s reported oil production figure was 12.8% below that of our pre-pandemic production peak, but 36.4% above the interim low of 8,428,000 barrels per day that US oil production had fallen to during the last week of June of 2016...

US oil refineries were operating at 86.7% of their capacity while using those 15,248,000 barrels of crude per day during the week ending January 28th, down from a utilization rate of 87.7% the prior week, and lower than the historical utilization rate for late January refinery operations…the 15,248,000 barrels per day of oil that were refined this week were still 4.1% more barrels than the 14,641,000 barrels of crude that were being processed daily during the pandemic impacted week ending January 29th of 2021, but 4.5% less than the 15,972,000 barrels of crude that were being processed daily during the week ending January 31st, 2020, when US refineries were operating at what was then also a below normal 87.4% of capacity...

With the decrease in oil being refined this week, gasoline output from our refineries was also lower, decreasing by 267,000 barrels per day to 8,650,000 barrels per day during the week ending January 28th, after our gasoline output had increased by 229,000 barrels per day over the prior week.…this week’s gasoline production was still 2.7% more than the 8,420,000 barrels of gasoline that were being produced daily over the same week of last year, but 12.7% less than the gasoline production of 9,903,000 barrels per day during the week ending January 31st, 2020.....at the same time, our refineries’ production of distillate fuels (diesel fuel and heat oil) decreased by 148,000 barrels per day to 4,602,000 barrels per day, after our distillates output had increased by 28,000 barrels per day over the prior week…after that decrease, our distillates output was fractionally less than the 4,622,000 barrels of distillates that were being produced daily during the week ending January 29th of 2021, and 7.5% less than the 4,976,000 barrels of distillates that were being produced daily during the week ending January 31st, 2020...

Even with the decrease in our gasoline production, our supplies of gasoline in storage at the end of the week rose for the eighth time in ten weeks, after falling continuously over the preceding six weeks, increasing by 2,119,000 barrels to 250,037,000 barrels during the week ending January 28th, after our gasoline inventories had increased by a near record 25,259,000 barrels over the prior four weeks...still, our gasoline supplies increased by more this week than last because the amount of gasoline supplied to US users decreased by 279,000 barrels per day to 8,226,000 barrels per day, and because our imports of gasoline rose by 119,000 barrels per day to 433,000 barrels per day, while our exports of gasoline rose by 228,000 barrels per day to 460,000 barrels per day…after five straight big inventory increases, our gasoline supplies are still 0.8% lower than last January 29th's gasoline inventories of 252,153,000 barrels, and still about 2% below the five year average of our gasoline supplies for this time of the year…

Despite this week's 279,000 barrel per day decrease, the four week average of our gasoline demand inched up by 13,000 barrels per day to 8,215,000 barrels per day this week...while that's 5.1% higher than our gasoline demand average of 7,812,000 barrels per day during the Covid surge of last January 29th, it's down by 6.0% from the average gasoline demand of 8,737,000 barrels per day on Jan 31st 2019, and is also lower than in any week during the 8 years before the onset of the pandemic....meanwhile, the gasoline inventory increase of 27,378,000 barrels over the past 5 weeks was the largest for any five week period on record since 1990, when gasoline inventories jumped by 31,056,000 in the period ending February 9th, and easily exceeded the largest 5  week inventory increase of 22,415,000 barrels that we saw at the outset of the pandemic lockdowns from early March to mid April of 2020...

Meanwhile, with the recent decreases in our distillates production, our supplies of distillate fuels decreased for the sixteenth time in twenty-three weeks, falling by 2,410,000 barrels to 125,154,000 barrels during the week ending January 28th, after our distillates supplies had decreased by 2,798,000 barrels during the prior week….our distillates supplies fell by less this week because the amount of distillates supplied to US markets, an indicator of our domestic demand, fell by 85,000 barrels per day to 4,669,000 barrels per day, and because our exports of distillates fell by 100,000 barrels per day to 527,000 barrels per day, and because our imports of distillates rose by 24,000 barrels per day to 250,000 barrels per day....after twenty-nine inventory decreases over the past forty-three weeks, our distillate supplies at the end of the week were 24.6% below the 162,838,000 barrels of distillates that we had in storage on January 29th of 2021, and about 19% below the five year average of distillates inventories for this time of the year…

Meanwhile, with the switch in unaccounted for crude from supply to demand, our commercial supplies of crude oil in storage fell for the 17th time in 26 weeks and for the 34th time in the past year, decreasing by 1,047,000 barrels over the week, from 416,190,000 barrels on January 21st to 415,143,000 barrels on January 28th, after our commercial crude supplies had increased by 2,377,000 barrels over the prior week…after this week’s decrease, our commercial crude oil inventories slipped to about 9% below the most recent five-year average of crude oil supplies for this time of year, but were still about 30% above the average of our crude oil stocks after the last full week of January over the 5 years at the beginning of the past decade, with the disparity between those comparisons arising because it wasn’t until early 2015 that our oil inventories first topped 400 million barrels....since our crude oil inventories had jumped to record highs during the Covid lockdowns of spring 2020 and remained elevated for most of a year after that, our commercial crude oil supplies as of this January 28th were 12.7% less than the 475,659,000 barrels of oil we had in commercial storage on January 29th of 2021, and are now 4.7% less than the 435,009,000 barrels of oil that we had in storage on January 24th of 2020, and also 7.2% less than the 447,207,000 barrels of oil we had in commercial storage on February 1st of 2019…

Finally, with our inventory of crude oil and our supplies of all products made from oil all near multi year lows, we are continuing to track the total of all U.S. Stocks of Crude Oil and Petroleum Products, including those in the SPR....the EIA's data shows that the total of our oil and oil product inventories, including those in the Strategic Petroleum Reserve and those held by the oil industry, and including everything from gasoline and jet fuel to propane/propylene and residual fuel oil, fell by 7,657,000 barrels this week, from 1,775,470,000 barrels on January 21st to 1,767,813,000 barrels on January 28th...that leaves our total supplies now at the lowest since June 6th, 2014, or at a seven and a half year low, despite the recent near record increase in gasoline inventories....

This Week's Rig Count

The number of drilling rigs running in the US increased for the 61st time over the past 72 weeks during the week ending February 4th, but were still 22.7% below the prepandemic rig count....Baker Hughes reported that the total count of rotary rigs drilling in the US increased by three to 613 rigs this past week, which was also 221 more rigs than the pandemic hit 394 rigs that were in use as of the February 5th report of 2021, but was also still 1,316 fewer rigs than the shale era high of 1,929 drilling rigs that were deployed on November 21st of 2014, a week before OPEC began to flood the global market with oil in an attempt to put US shale out of business….

The number of rigs drilling for oil was up by 2 to 497 oil rigs during this week, after they had increased by 4 rigs during the prior week, and there are now 198 more oil rigs active now than were running a year ago, even as they still amount to just 30.9% of the shale era 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 was up by 1 to 116 natural gas rigs, which was also up by 24 natural gas rigs from the 92 natural gas rigs that were drilling during the same week a year ago, but still only 7.2% of the modern high of 1,606 rigs targeting natural gas that were deployed on September 7th, 2008….also note that last year's rig count also included a rig that Baker Hughes had classified as "miscellaneous', while there are no such "miscellaneous' rigs deployed this week...

The Gulf of Mexico rig count was down by 2 to 16 rigs this week, with seventeen of this week's Gulf rigs drilling for oil in Louisiana waters and another rig drilling for oil in Alaminos Canyon, offshore from Texas....that's the same number of Gulf rigs that were active in the Gulf a year ago, when 14 Gulf rigs were drilling for oil offshore from Louisiana and two were deployed for oil in Texas waters…since there is not any drilling off our other coasts at this time, nor was there a year ago, the Gulf rig counts are equal to the national offshore totals for both years....

In addition to those rigs offshore, we also have 2 water based rigs drilling inland; one is a horizontal rig targeting oil at a depth of between 5000 and 10,000 feet, drilling from an inland body of water in Plaquemines Parish, Louisiana, near the mouth of the Mississippi, and the other is a directional rig drilling for oil at a depth of over 15,000 feet in the Galveston Bay area... the inland waters rig count of two is now up by one from the single inland waters rigs that was deployed a year ago..

The count of active horizontal drilling rigs was up by 2 to 555 horizontal rigs this week, which was also 201 more rigs than the 344 horizontal rigs that were in use in the US on February 5th of last year, but still 59.6% less than the record 1,374 horizontal rigs that were drilling on November 21st of 2014.... at the same time, the vertical rig count was up by 3 rigs to 25 vertical rigs this week, which was also up by 4 from the 22 vertical rigs that were operating during the same week a year ago…on the other hand, the directional rig count was down by 2 to 34 directional rigs this week, but those were still up by 16 from the 18 directional rigs that were in use on February 5th of 2021….

The details on this week’s changes in drilling activity by state and by major shale basin are shown in our screenshot below of that part of the rig count summary pdf from Baker Hughes that gives us those changes…the first table below shows weekly and year over year rig count changes for the major oil & gas producing states, and the table below that 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 February 4th, the second column shows the change in the number of working rigs between last week’s count (January 28th) and this week’s (February 4th) count, the third column shows last week’s January 28th active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running on the Friday before the same 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 5th of February, 2021...

as you can see, there was a lot more happening this week than the national 3 rig increase would indicate...checking the Rigs by State file at Baker Hughes for changes in Texas, we find that four rigs were added in Texas Oil District 8, which encompasses the core Permian Delaware, while a rig was pulled out of Texas Oil District 7C, which includes the counties of the southern Permian Midland....since the Permian basin rig count was up by 3 in Texas, while the national Permian rig count was only up by 1, that means that the two rigs that were pulled out in New Mexico had been drilling in the far western Permian Delaware, to balance that total...elsewhere in Texas, there were two rigs added in Texas Oil District 1, but there were two rigs pulled out of Texas Oil District 2​ at the same time​, leaving the Eagle Ford rig count unchanged; however, one of those rig additions was targeting natural gas, while one of the removals had been drilling for oil...there was also a rig pulled out of Texas Oil District 6, but it wasn't targeting the Haynesville, since there is no corresponding addition in northern Louisiana, while there was a rig added in ​the panhandle ​Texas Oil District 10, which is targetting the Granite Wash for oil...

elsewhere, the four oil rigs added in the Williston basin included 3 ​rigs ​in North Dakota and one in Richland county Montana, the first rig in that state since November 19th.... in Louisiana, the two rig decrease was ​because two rigs ​were removed from the state's offshore waters, while the rig pulled out of California as well as the two added in Alaska involved basins that Baker Hughes doesn't identify, but which we've determined to include one on the North Slope and another in the Sagavanirktok River basin near Prudhoe Bay....in Oklahoma, there were rigs pulled out of both the Arkoma Woodford and the Cana Woodford shales, but since the state total is only down by 1, we figure a rig had to be added elsewhere in the state, in a basin that Baker Hughes doesn't track...​finally, ​for natural gas rigs, there was the one added in the Eagle Ford, and another added in Ohio's Utica shale, and two more were added in West Virginia's Marcellus, while the Marcellus oil rig that began drilling in Wetzel county West Virginia​ ​two weeks ago was pulled out the same time...partly offseting those​ additions​, two natural gas rigs were pulled out of Pennsylvania's Marcellus and another was removed from a basin that Baker Hughes doesn't track...

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Pipeline sues federal regulators in fight over fine for demolition of dilapidated Ohio home - – The owners of a major, multistate pipeline project that spans northern Ohio went to court Friday in a fight with regulators that stems from a dilapidated house. Energy Transfer and its subsidiary, Rover Pipeline LLC, filed a lawsuit against the Federal Energy Regulatory Commission in U.S. District Court in Akron. The companies allege they face a fine of more than $20 million from the commission for failing to disclose their intentions to remove the home in Carroll County in 2016. The regulatory commission ordered the companies to appear before an administrative law judge for a hearing in September. The companies, however, said the issue belongs in federal court, where it can litigate its claims and receive an impartial review, “rather than in an in-house enforcement proceeding.” The case centers around the pipeline’s application process. Regulators contend the companies made misrepresentations and omitted information about the home during the application process to build Rover’s $4.2 billion pipeline. But in the lawsuit, the companies claim that the information about the home was immaterial to the project and, therefore, didn’t need to be passed along. The companies purchased the Carroll County property in 2015. It was part of the land where Energy Transfer sought to place a business operation center. The home was built in 1843, and it had holes in its roof, rotting floors and electrical and plumbing problems that needed to be overhauled, according to the lawsuit. It says that, at one point, a local fire department “even considered burning it down as part of a training exercise.” “[The companies] also explained that they had every legal right to remove the house, and their plans for its removal were known” to a state historic preservation officer, who didn’t object, the lawsuit says.

Ohio to receive $256M for abandoned oil and gas wells - Ohio will receive $256 million in new federal funding under the bipartisan Infrastructure Investment and Jobs Act to clean up abandoned oil and gas sites known as orphaned wells.Nearly 81,000 abandoned drilling sites across the country — including 891 in Ohio — are emitting methane gas and leaking toxic pollution into nearby communities, a news release states.The Bipartisan Infrastructure Law secured $4.7 billion in new federal funding to help communities plug orphaned wells. The first phase of that funding, announced this week, totals $1.15 billion across 26 states. “These urgently needed funds from the Bipartisan Infrastructure Law will help get rid of dangerous pollution, ensure our kids have clean air and drinking water and simultaneously create good-paying jobs,” U.S. Rep. Tim Ryan of Howland, D-13th, said in the release. “This investment is a major win for our environment, our economy and our families.”

Energy Transfer criminally charged for Revolution Pipeline explosion - Corporate owners of the Revolution Pipeline that exploded in Beaver County more than three years ago are now criminally charged for their role in the disaster. Pennsylvania Attorney General Josh Shapiro on Wednesday said the Office of Attorney General Environmental Crimes Section is charging Energy Transfer subsidiary ETC Northeast Pipeline with nine counts of environmental crimes related to company “negligence” that ultimately caused the line to erupt in Center Township in September 2018. An investigating grand jury heard testimony and examined records showing the explosion happened because builders “repeatedly ignored environmental protocols and custom plans that were created to minimize erosion and the possibility of a landslide at the site," Shapiro said in a news release. Dallas-Based Energy Transfer is charged with two counts of prohibition of discharge of industrial waste, two counts of prohibition against other pollutions, two counts of potential pollution and three counts of unlawful conduct. Shapiro in October charged Energy Transfer with 48 counts of environmental crimes related to contaminated wetlands and residential drinking water during construction of its controversial Mariner East lines. Lack of proper erosion control devices led to an initial landslide at the Center Township site, the grand jury found. Despite that, contractors “continued restoring the pipeline site without adding more erosion controls,” Shapiro said, which inevitably led to another landslide following heavy rainfall. During that slide, the Revolution burst into flames, releasing more than 3 million cubic feet of natural gas, torching multiple acres of forested areas, destroying property and traumatizing nearby residents. The subsequent pollution, Shapiro said, violated the Clean Streams Law.A Department of Environmental Protection investigation found the company had not properly stabilized a number of areas along the route to prevent landslides; the DEP later fined Energy Transfer $30.6 million in civil penalties, with millions more paid to Pennsylvania’s Public Utility Commission. The company has faced hundreds of new violations since. If convicted, it could face fines and restitution. The 40-mile natural gas line, now back in operation, travels across Butler, Beaver and Washington counties between two processing facilities.

PennEnergy's Appalachian Natural Gas Gains RSG Tag for 99% of Production - Nearly all of PennEnergy Resources LLC’s natural gas wells have been certified as producing responsibly sourced gas (RSG), the Appalachian Basin-focused exploration and production (E&P) company reported. Regional Prices Project Canary used its TrustWell environmental certification process and determined that 375 of 378 wells, or 99%, earned a gold or platinum rating, PennEnergy said. The global gas market is increasingly adopting RSG and other designations for certifying natural gas supplies from the wellhead to end user. Certified gas is viewed as a means of making supply more attractive to some foreign markets and potentially within the United States. Focused on the Marcellus and Utica shales and Upper Devonian formation, PennEnergy’s operations span three Southwest Pennsylvania counties. According to Project Canary, the RSG designation covers operational, environmental, social, and governance (ESG) data points on a per-well and midstream asset basis. PennEnergy CEO Rich Weber said Project Canary performed a “rigorous review across all of our well pads.” Among other things, the E&P has deployed monitoring units to detect and measure methane and other emissions in real time. “Our independent analysis validates PennEnergy’s commitment to operational excellence and ESG performance,” said Project Canary CEO Chris Romer. Other North American E&Ps that have pursued gas production certification include Chesapeake Energy Corp., PureWest Energy LLC, Vermilion Energy Inc. and EQT Corp. and Seneca Resources Corp.

Gov. Wolf Announces $104 Million from President Biden’s Bipartisan Infrastructure Law to Support Orphaned, Abandoned Well Cleanup in PA -Governor Tom Wolf announced today that Pennsylvania has been awarded its initial allocation of $25 million, and will receive a total of $104 million, from President Joe Biden’s Bipartisan Infrastructure Law to plug orphaned and abandoned wells in Pennsylvania. In addition to reducing pollution, the funding will support the creation of new, good-paying jobs related to the cleanup.“Today’s announcement from the Biden Administration is welcome relief, and I’m pleased that the president shares my commitment to addressing this legacy issue,” said Gov. Wolf. “Addressing Pennsylvania’s orphaned and abandoned gas and oil wells will not only support our efforts to reduce greenhouse gas emissions, but it will create a cleaner local ecosystem at each well site and energize the economy of our entire commonwealth.”Pennsylvania is home to tens of thousands of orphaned and abandoned wells. These wells have the potential to pollute backyards, recreational areas, and public spaces, and frequently release methane, a potent greenhouse gas with a global warming potential more than 28 times that of carbon dioxide. This initial $25 million investment from the Bipartisan Infrastructure Law will support plugging the wells to address environmental, health, and safety concerns.The Wolf Administration looks forward to working with the Department of Interior to put the resources announced today to work to enhance the state’s well plugging program and immediately remediate high-priority wells. The $25 million announced today is Pennsylvania’s initial grant allotment of $104 million in Phase I funding available to the commonwealth through the Bipartisan Infrastructure Law. Pennsylvania is set to receive the second largest allocation of funding, after Texas.

Following Protest, NY Postpones Decision On Natural Gas Permit For Greenpoint Energy Center - The New York State Department of Environmental Conservation (DEC) and the multinational energy company National Grid mutually agreed to extend the deadline for a final decision on a permit that could expand natural gas production at the Greenpoint Energy Center.The request for extension was filed Friday, the day after residents, local activists and two Congresswomen called on Gov. Kathy Hochul to reconsider the air permit that would allow the energy facility to process more liquid natural gas, and by extension, potentially leak more airborne pollutants. National Grid signed and agreed to the extension the same day it was submitted. A decision had been slated to happen by February 7th.DEC officials told WNYC/Gothmist that the extra time would enable the agency to complete its ongoing review of more than 6,000 public comments submitted between November 10th, 2020 and March 22nd, 2021, including from three public hearings held in March 2021. They also said it’s the sixth time an extension has been made since National Grid initially requested the permit in May 2020. “Once the review is complete, DEC will determine next steps, including if an adjudicatory hearing would be held on the application, prior to making a decision,” DEC said in an email to WNYC/Gothamist.

Con Edison, KeySpan urge FERC to ignore EPA call to pause natural gas project reviews - The Federal Energy Regulatory Commission should ignore the Environmental Protection Agency's suggestion that FERC stop acting on natural gas infrastructure proposals until it revises its policy for how to review them, Consolidated Edison and KeySpan Gas East, a National Grid utility, said Friday. Delaying the Iroquois Gas Transmission System's proposal to beef up its existing pipeline to increase gas deliveries to the New York City area would threaten reliability and safety, ConEd said in a filing at FERC. "Despite the near-term impacts caused by the COVID pandemic and the recent enactment of a ban on new gas service connections within New York City limits, ConEd forecasts continued firm customer peak day gas demand growth in its service territory for the next several years," ConEd said. Across the United States, environmental and other groups are urging regulators to stop enabling the expansion of the natural gas system, which they say will lead to increased greenhouse gas emissions (GHG). FERC is preparing to update its decades-old criteria for reviewing gas infrastructure proposals, a revision that could affect how the agency considers potential GHG emissions from a project and its effect on the climate.In New York, Iroquois Gas proposed expanding capacity on its pipeline by 125,000 million cubic feet per day by upgrading four existing compressor stations. Half the capacity is under contract to KeySpan Gas and half to ConEd.In part, the extra gas supply is needed to facilitate a New York City policy that aims to slash the use of oil to heat buildings, according to ConEd.FERC staff released an environmental assessment for the project in September 2020, typically the last step before the agency makes a decision on a proposed project. However, responding to court decisions, in May 2021, FERC ordered its staff to revise pending environmental reviews by bolstering their greenhouse gas emissions analysis, a move that sparked concerns bySen. John Barrasso, R-Wyo., about delays to the process.

Appeals court throws out another pipeline permit - — For the second time in as many weeks a federal appeals court threw out a permit for the Mountain Valley Pipeline on Thursday.In a written opinion, the 4th U.S. Circuit Court of Appeals found “serious errors” with the U.S. Fish and Wildlife Service’s conclusion that building the pipeline across rugged mountainsides wouldn’t jeopardize endangered species in its path — specifically the Roanoke logperch and the candy darter, The Roanoke Times reported. Last week, the same three-judge panel shot down a permit that would have allowed the pipeline to pass through a 3.5 mile (5.6 kilometer) section of the Jefferson National Forest. In both cases, the judges faulted the U.S. Forest Service and the wildlife agency for failing to adequately assess the pipeline’s environmental impact. The 303-mile (487-kilometer) pipeline would transport natural gas drilled from the Marcellus and Utica shale formations through West Virginia and Virginia.“We recognize that this decision will further delay the completion of an already mostly finished pipeline, but the Endangered Species Act’s directive to federal agencies could not be clearer: halt and reverse the trend toward species extinction, whatever the cost,” the 40-page opinion concluded. Mountain Valley said it is reviewing the court’s decision and evaluating its next steps.

U.S. natgas rises over 5%, marks first monthly gain in four (Reuters) - U.S. natural gas futures rose more than 5% on Monday, registering their first monthly gain in four, helped by forecasts for colder weather and higher heating demand over the next two weeks. Front-month gas futures for March delivery rose 23.5 cents, or 5.1%, to settle at $4.874 per million British thermal units (mmBtu), after rising nearly 9% to $5.057 earlier in the session. For the month, the contract was up about 31% after falling 18% in December, its biggest monthly decline in two years. The current rally appears to be the result of "short covering driven by the short-term weather outlook, which is colder-than-normal", Robert DiDona of Energy Ventures Analysis said. "Given the colder GFS (Global Forecasting System) model outlook, buy-side interest is resulting in a stronger price point," he added. "However, at the current elevated levels, it will be hard to sustain buy-side interest unless the cold forecast intensifies or continues beyond the current 11-15 day period." In intraday trade on Thursday, the February contract rose to $7.346 per mmBtu, the highest price for the front month since November 2008. The contract settled up about 46% at $6.265, its biggest daily percentage gain on record and the highest close for the front month since October 2021. Data provider Refinitiv estimated 485 heating degree days (HDDs) over the next two weeks in the Lower 48 U.S. states. The normal is 420 HDDs for this time of year. HDDs, used to estimate demand to heat homes and businesses, measure the number of degrees a day's average temperature is below 65 Fahrenheit (18 Celsius). In addition to extreme cold, record U.S. liquefied natural gas (LNG) exports were also supporting prices as global LNG buyers looked for ways to send more fuel to Western Europe in case Russia invades Ukraine and cuts off gas supplies to the rest of the continent. The amount of gas flowing to U.S. LNG export plants has averaged 12.5 bcfd so far this month, topping December's monthly record of 12.2 bcfd. Refinitiv said average output in the U.S. Lower 48 states had fallen to 94.2 bcfd so far in January from a record 97.6 billion cubic feet per day (bcfd) in December. Output dipped after wells in several regions froze, including the Permian in Texas and New Mexico, the Bakken in North Dakota and Appalachia in Pennsylvania, West Virginia and Ohio. Refinitiv projected average U.S. gas demand, including exports, would rise from 136.0 bcfd this week to 139.3 bcfd next week.

Extreme Volatility Ends with March Natural Gas Off 12 Cents Despite Approaching Arctic Blast - After eight straight gains, natural gas futures stumbled on Tuesday as weather forecasts backed off the intensity of frigid weather expected in Texas later this week. Warmer weather in Europe, along with an increase in Russian gas flows to the continent, also weighed on U.S. markets, with the March Nymex gas futures contract down 12.3 cents to $4.751/MMBtu. April settled at $4.573, off 10.2 cents. Spot gas prices were mixed, but leaned lower overall thanks to substantial decreases in the Northeast. NGI’s Spot Gas National Avg. tumbled 46.5 cents to $6.125. While there is no disagreement that widespread cold is to blanket much of the United States this week, weather models in recent runs have shown a not-as-chilly pattern in Texas. Still, temperatures were forecast to plunge into the 20s as far south as the Texas coast, with even lower temperatures in the northern half of the state. NatGasWeather said the gas markets are likely nervous about what the late-week Arctic freeze may bring to Texas and the South. This week’s polar plunge is set to arrive days ahead of the one-year anniversary of deadly Winter Storm Uri, which resulted in a 20% drop in Texas gas supply. Even if the expected freeze is not as intense as initially modeled, NatGasWeather said production is likely to be curbed because of pipeline freeze-offs. Dry gas production in the Permian Basin last month dipped below 11 Bcf/d, off from more than 14 Bcf/d when temperatures plummeted. However, output quickly recovered and has hovered on either side of 14 Bcf/d in recent days.

Supply Concerns, Short Squeeze Drive Massive 75-Cent Gain for March Natural Gas - No groundhogs were needed to convince natural gas traders that Old Man Winter was planning to stick around longer across the United States. A biting February forecast combined with strong storage withdrawals, potential supply disruptions and robust export demand to send March Nymex natural gas futures ballooning to $5.501/MMBtu on Wednesday, up 75.0 cents on the day. April surged 47.1 cents to $5.044. Spot gas action was similarly volatile as intense heating demand was seen permeating the eastern half of the country for the next several days as temperatures plunge. Cash jumped more than $1.00 at most locations, with NGI’s Spot Gas National Avg. up $1.315 to $7.440. The multi-day stretch of bitter cold arrived in the central United States midweek, ushering in heavy snow that is expected to extend from the southern Rockies to northern New England when all is said and done, according to the National Weather Service. Heavy ice accumulation was likely from Texas to Pennsylvania. Although the approaching one-year anniversary of Winter Storm Uri may be causing some jitters in Texas, Bespoke Weather Services said the threat of widespread power outages amid the deep freeze was not to blame for Wednesday’s monstrous rally. Instead, it’s “the fact that we are seriously drawing down storage levels,” Bespoke said. “And more cold will only add to this issue, making it tougher to refill to comfortable levels by the end of injection season.” Government inventory reports have shown a steepening drawdown in recent weeks as a result of frigid weather through most of January. The Energy Information Administration (EIA), set to release its next report at 10:30 a.m. ET Thursday, has reported at least a 200 Bcf withdrawal in each of the last three weeks. Another 200 Bcf-plus pull is expected for Thursday. A Bloomberg survey of eight analysts produced a range of estimates from 263 Bcf to 292 Bcf, with a median of 280 Bcf. A Wall Street Journal survey had the same range of projections and landed at an average decline of 267 Bcf. A Reuters poll was wider with a low estimate of 232 Bcf, a high of 297 Bcf and a median of 277 Bcf. NGI modeled a 286 Bcf pull. This would easily crush the 183 Bcf withdrawal recorded by the EIA in the same week last year and the five-year average of 150 Bcf. .

U.S. Natural Gas Drops 11% on Milder Forecasts Despite Winter Storm - (Reuters) - U.S. natural gas futures dropped about 11% on Thursday in what has already been an extremely volatile week on a slightly smaller-than-expected storage draw and forecasts for less cold and lower heating demand over the next two weeks than previously expected. That price decline came even as a major winter storm hit Texas and the rest of the central United States, reminding the market of last year's February freeze when gas pipes and power plants froze, leaving millions without power and heat for days. The weather, however, was still expected to remain colder than normal through mid February, which caused prices to rocket up almost 16% on Wednesday. That cold has already frozen gas wells and caused U.S. output to drop to its lowest since last February. The U.S. Energy Information Administration (EIA) said U.S. utilities pulled a massive 268 Bcf of gas from storage during the brutally cold week ended Jan. 28, the biggest weekly withdrawal since last year's February freeze. That withdrawal, however, was lower than the 277-bcf drop analysts forecast in a Reuters poll and compares with a decline of 183 bcf in the same week last year and a five-year (2017-2021) average decline of 150 bcf. "Sustained cold is expected to drive the following two withdrawals past 200 bcf as well, and the market faces the potential of experiencing five consecutive 200+ withdrawals, a feat not ever witnessed in the history of the gas market," Front-month gas futures for March delivery on the New York Mercantile Exchange (NYMEX) fell 61.3 cents, or 11.1%, to settle at $4.888 per million British thermal units. On Wednesday, the contract jumped 15.8% to its highest close since Jan. 27 when it soared 46% and settled at its highest since December 2008. The NYMEX said the number of futures traded on Wednesday jumped to 851,384 contracts, the highest daily volume since last year's February freeze. Data provider Refinitiv said output in the U.S. Lower 48 states fell from a record 97.3 Bcf/d in December to 92.9 Bcf/d in January and 91.3 Bcf/d so far in this month after wells in several regions froze, including the Permian in Texas and New Mexico, the Bakken in North Dakota and the Appalachia in Pennsylvania, West Virginia and Ohio. On a daily basis, preliminary data from Refinitiv showed output on Thursday was on track to drop to 88.2 Bcf/d, which would be its lowest in a day since last year's February freeze.

U.S. natgas drops near 7% on forecasts for less cold, despite winter storm — U.S. natural gas futures dropped almost 7% on Friday during a period of record volatility on forecasts for less cold and lower heating demand over the next two weeks than previously expected. Traders said the price declined even as a massive storm battered much of the country from Texas to New York, cutting gas output to its lowest level since 2021's February freeze. Last February, Winter Storm Uri killed over 200 people in Texas, caused power and gas prices to soar to record highs in many parts of the country and left millions of homes and businesses without heat and power for days after gas pipes and power plants froze. This week's storm, called Winter Storm Landon, was much less severe than Uri. High temperatures during Uri remained below freezing (32 degrees Fahrenheit or zero degrees Celsius) for eight days in a row in the West Texas town of Midland in the Permian oil- and gas-producing shale basin, according to AccuWeather. The normal high in Midland is 64 F at this time of year. High temperatures during Landon, however, were only expected to remain below freezing for one day and that was Thursday when the mercury reached just 24 F. As for power outages, there were only around 300,000 homes and businesses without service Friday afternoon from Texas to New York - though the storm was still ongoing. Front-month gas futures () for March delivery fell 31.6 cents, or 6.5%, to settle at $4.572 per million British thermal units, their lowest close since Jan. 26. That 7% decline was actually a quiet day for the front-month after a couple of extremely volatile weeks when the contract soared by a record 46% on Jan. 27, plunged 26% on Jan. 28, jumped 16% on Feb. 2 and fell 11% on Feb. 3. Those large price changes over the past couple of weeks boosted close-to-close volatility over the past 30 days to a record high on both Thursday and Friday, above the prior volatility high set in 1996.

Feds sending Louisiana $111 million to plug hundreds of 'orphan' oil and gas wells - Louisiana is set to receive more than $111 million as part of a new federal program aimed at plugging the growing number of “orphan” oil and gas wells around the country, a move that could reduce one of the state’s biggest environmental threats and give Louisiana a much-needed economic boost. The U.S. Interior Department announced on Monday that Louisiana would be awarded about $47 million to plug and clean up orphan wells as part of the first phase of funding and grants from the Infrastructure Investment and Jobs Act, which President Joe Biden signed in November. Louisiana’s allotment is expected to grow to at least $111.4 million in later phases, according to U.S. Sen. Bill Cassidy, one of the act’s sponsors. “I’ve heard from communities across Louisiana about the environmental and safety hazards of orphan wells,” the Baton Rouge Republican said. “This funding from the bipartisan infrastructure package will create jobs, help state officials address these wells and make Louisiana a cleaner place to live. In addition, the land around these wells can be repurposed and lead to an economic boost.” Just two members of Louisiana's eight-member congressional delegation voted for the infrastructure bill: Cassidy and U.S. Rep. Troy Carter, D-New Orleans. The U.S. has millions of wells that have been abandoned by their owners and are now the responsibility of state governments. Louisiana’s official tally is 4,605 orphan wells, but state officials stay there are likely many more that have not been documented. The number is expected to grow as more wells are shut down due to low oil prices and a spate of bankruptcies and downsizings by small oil and gas companies. The $111.4 million for Louisiana is enough money to plug about a quarter of the state’s documented orphan wells.

Judges Increasingly Demand Climate Analysis in Drilling Decisions - — A judge’s decision this week to invalidate the largest offshore oil and gas lease sale in the nation’s history, on grounds that the government had failed to take climate change into consideration, shows that regulatory decisions that disregard global warming are increasingly vulnerable to legal challenges, analysts said Friday.Judge Rudolph Contreras of the United States District Court for the District of Columbia ruled on Thursday that the Biden administration had acted “arbitrarily and capriciously” when it conducted an auction of more than 80 million acres in the Gulf of Mexico. The Interior Department failed to fully analyze the climate effects of the burning of the oil and gas that would be developed from the leases, the judge said.The ruling is one of a handful over the past year in which a court has required the government to conduct a more robust study of climate change effects before approving fossil fuel development. Analysts said that, cumulatively, the decisions would ensure that future administrations are no longer able to disregard or downplay global warming.“This would not have been true 10 years ago for climate analysis,” said Richard Lazarus, a professor of environmental law at Harvard University. He said it is “a big win” that courts are forcing government agencies to include “a very robust and holistic analysis of climate” as part of the decision-making when it comes to whether or not to drill on public lands and waters.Emissions from fossil fuel extraction on public lands and in federal waters account for about 25 percent of the country’s greenhouse gases.Shell, BP, Chevron and Exxon Mobil offered $192 million for the rights to drill in about 1.7 million acres in the area offered by the government in the Nov. 17 lease sale. The leases have not yet been issued.Judge Contreras said the government had relied upon an outdated and flawed analysis from the Trump administration, which argued that not holding the lease sale would result in higher greenhouse gas emissions because oil companies overseas would increase their production to fill a vacuum in the market.He called reliance on that analysis a “serious failing” and ordered a new study under the National Environmental Policy Act, or NEPA, which says the government must consider ecological damage when deciding whether to permit drilling and construction projects.The judge reached the same conclusion as judges for both the United States Court of Appeals for the 9th Circuit and the District Court for the District of Alaska in cases within the past two years concerning lease sales based on a similar analysis.

Federal Judge Cancels Oil and Gas Leases in Gulf of Mexico, Citing Climate Crisis - In a huge win for environmental groups, a federal judge has canceled more than 80 million acres of oil and gas leases in the Gulf of Mexico. Judge Rudolph Contreras of the United States District Court for the District of Columbia ruled that the Biden administration failed to sufficiently take climate change into consideration when offering the leases. Environmental group Earthjustice brought the suit on behalf of four other environmental groups, Reuters reported. Earthjustice argued that, in selling the oil and gas leases, the U.S. Department of the Interior was relying on an outdated environmental analysis that didn’t provide a realistic assessment of the impacts of the greenhouse gas emissions that would result from the development of the leases. Now the Department of the Interior must conduct a new environmental analysis that takes greenhouse gas emissions into account before it decides whether or not to hold a new auction, reported The New York Times. “This requires the bureau to go back to the drawing board and actually consider the climate costs before it offers these leases for sale, and that’s really significant. Once these leases are issued, there’s development that’s potentially locked in for decades to come that is going to hurt our global climate,” Hardy said. However, a lawsuit brought by attorneys general from 13 states led to a federal judge in Louisiana blocking the order, as well as ruling that the administration must go forward with the lease sales that had already been scheduled. According to CNN, at the time Biden administration officials acknowledged that the sale went against its climate goals, but said that there was nothing they could do. Biden administration officials have asserted that if the lease auction wasn’t held, Interior Secretary Deb Haaland risked being held in contempt of court, but environmental groups argued that there were other options for the administration to consider, including doing a new assessment of the environmental impacts, The New York Times reported. “We will continue to hold the Biden administration accountable for making unlawful decisions that contradict its pledge to take swift, urgent action on code red climate and environmental justice priorities,” said legal director at Friends of the Earth Hallie Templeton, reported The New York Times.

Court's invalidation of offshore drilling sale ratchets up the pressure on Interior - The Interior Department is under pressure from both the fossil fuel industry and environmentalists over an assessment of an offshore drilling lease sale first greenlighted by the Trump administration. A cancellation of the offshore lease in the Gulf of Mexico by a federal judge was a win for the Biden administration, but now the decision rests with the Interior Department on how to proceed. The agency faces a tough decision about whether to cancel, change or maintain the sale without the ability to blame the outcome on Trump-era calculations. The development is the latest in a saga of court challenges regarding this particular offshore drilling lease sale. The lease sale, known as Lease Sale 257, was originally approved at the end of former President Trump’s tenure. It was later carried out by the Biden administration after a June ruling against its pause on new oil and gas leasing. Last week, Judge Rudolph Contreras, an Obama appointee, invalidated the sale and the leases won during it, stating that the Trump administration’s assessment had failed to account for how the sale would change global fossil fuel demand, potentially worsening climate change. In his decision, Contreras gave the Biden administration a great deal of latitude on how to approach the solution to this problem, writing that he would “vacate Lease Sale 257 and allow the agency an opportunity to remedy its ... error as it so chooses in the first instance.” “The Court does not specify how BOEM must do so, on what timeline, or what ultimate conclusion it must reach, leaving those issues to the sound discretion of the agency,” he said, referring to the Bureau of Ocean Energy Management. Asked about next steps, the Interior Department referred The Hill to a statement issued on the decision in which spokeswoman Melissa Schwartz said the department was “reviewing the court’s decision concerning deficiencies.” Schwartz also emphasized that the department was “compelled to proceed with Lease Sale 257” by the June ruling and said that “deficiencies” in the overall oil and gas program need change. “Especially in the face of the climate crisis, we need to take the time to make significant and long overdue programmatic reforms,” she said. According to Sara Gosman, an environmental law professor at the University of Arkansas, the ruling leaves the BOEM, which is overseen by the Interior Department, with multiple options. In an emailed statement to The Hill, Gosman said that after its revised analysis, the department could choose to either not hold the sale or decide to hold a smaller one if these decisions are backed by a new analysis. She also said that the department may be able to “drag its feet and not make a decision” until the end of the current leasing period, effectively halting it.

Court ruling gives Biden chance for reset on climate policy - (AP) — President Joe Biden has an opportunity for a reset on climate policy after a federal judge rejected an administration plan to lease millions of acres in the Gulf of Mexico for offshore oil drilling.U.S. District Judge Rudolph Contreras tossed the drilling plan late Thursday, saying the Interior Department did not adequately take into account the proposed drilling’s effect on planet-warming greenhouse gas emissions. Environmentalists say the lease sale goes against Biden’s campaign promise to stop new oil and gas leasing on federal land and water. The court decision was released on the one-year anniversary of a federal leasing moratorium Biden ordered as part of his efforts to combat climate change.The Biden administration proceeded with the sale after losing a court case in Louisiana last summer. Energy companies including Shell, BP, Chevron and ExxonMobil offered a combined $192 million for drilling rights on more than 300 tracts totaling nearly 2,700 square miles, one of the largest sales ever in the Gulf. The 68-page decision by Contreras sends the proposed Gulf lease sale back to Interior to decide next steps.Biden has set an ambitious goal to slash planet-warming greenhouse gas emissions in half by 2030, speeding what is already a market-driven growth of solar and wind energy and lessening the country’s dependence on oil and gas. The push comes as the effects of climate change, including more powerful hurricanes, wildfires and drought, are increasing. Moving ahead with the sale — initiated by the Trump administration — “was terrible policy and also bad politics,″ said Drew Caputo, vice president of litigation at Earthjustice, one of the environmental groups that challenged the offshore sale. Biden “campaigned on addressing climate change, and a growing sector of the electorate — young, diverse and active — are climate change voters,″ he said. “They voted for Biden, and if he wants them to vote for him again the White House needs to respond on climate.″

Exxon locked workers out of their jobs. Can workers lock Exxon out of a carbon capture deal? - In Beaumont, Texas, working at one of Exxon Mobil’s plants has long been a way to earn steady wages and support a family in this industrial corner of the Gulf Coast. But for the past nine months, about 600 union employees at Exxon’s refinery and other plants have been struggling to pay their own bills: They have been locked out of their jobs because Exxon has been unable to come to an agreement with the union over a new contract. Kyle said that the company is refusing to honor protections for senior workers that have been in place for decades, while the union is demanding that those protections remain in place. At the end of last April, without a contract finalized and with the threat of a union strike pending, the company began escorting employees out of the complex, theBeaumont Enterprise, a local newspaper, reported. The company stated that the provisions the union was asking for were “items that would significantly increase costs and limit the company’s ability to safely and efficiently operate.”Some workers, willing to take the deal Exxon was offering, began a campaign to decertify the union, which would end union representation at the plants. The United Steelworkers union believes that Exxon illegally assisted the campaign and has filed complaints with the National Labor Review Board. But in addition to using this legal channel to try to protect their union, the Steelworkers tried a different tactic. They started their own campaign to pressure Exxon into a deal — by undermining the company’s push for public money to build a $100 billion carbon capture hub in nearby Houston. Last April, just before the lockout began, Exxon announced a proposal to turn the Houston Ship Channel into a carbon capture and storage “innovation zone.” The Ship Channel is a 50-mile stretch in the Port of Houston that’s home to a high concentration of industrial facilities. Exxon said it wanted to work with other companies in the area to capture carbon dioxide emissions from the manufacturing, chemical, and power plants there, and pipe the CO2 out to the Gulf of Mexico to be pumped thousands of feet under the seafloor for permanent storage. It estimates the project could eventually capture 100 million metric tons of carbon annually by 2040, which is about 1.5 percent of current U.S. emissions. Exxon has stressed that the $100 billion concept would require a mix of public and private funding, such as corporate tax breaks, and began lobbying local leaders for support.

Chevron had ‘strong’ Permian output growth in Q4, 10% increase eyed for 2022: CEO -Chevron’s Permian Basin production showed “strong” production growth in fourth-quarter 2021 which was just shy of the landmark 700,000 boe/d level, and 50% higher activity levels are projected this year for the company’s operation in the giant West Texas/New Mexico basin, its top executive said Jan. 28. The company is targeting full-year Permian production growth of 10% in 2022, which is “a little bit better” than earlier projected, CEO Mike Wirth said during Chevron’s quarterly earnings call. In Q4, Chevron’s Permian production of 681,000 boe/d from unconventional West Texas/New Mexico reservoirs was up 11% year on year and 9% sequentially. The company’s full-year 2021 production from the basin averaged 608,000 boe/d, up 6% year on year. Permian output growth of 10% year over year in 2022 would would place full-year production around 670,000 boe/d. Wirth anticipates “a little bit over 200 wells” are anticipated to be placed on production this year in the basin, which would be up about 50% from 2021. “Activity in the Permian is really increasing aligned with the guidance that we’ve issued previously and spending this year up from $2 billion to $3 billion,” he said. “Broadly speaking, the Permian is healthy and getting better,” he said. “That is the largest piece of what we would anticipate in terms of production growth” over the coming year within the company’s portfolio.

Double E Pipeline expands Permian gas deliveries amid drilling, production ramp - The 1.35 Bcf/d Double E Pipeline has begun delivering Permian Basin gas supply to Kinder Morgan's intrastate Gulf Coast Express project in a bullish sign for West Texas and New Mexico production. Deliveries from the recently commissioned Double E Pipeline to Gulf Coast Express began Jan. 25 with flows at the interconnection point averaging just under 40 MMcf/d over the past week, S&P Global Platts Analytics data shows. The new deliveries potentially point to growing demand for capacity on Double E Pipeline and its downstream interconnection to Gulf Coast Express. Following commercial startup of Double E in November, the project had previously made intrastate deliveries exclusively to Kinder Morgan's Permian Highway Pipeline. In January, flows from Double E to Permian Highway have averaged nearly 150 MMcf/d – an increase of about 20 MMcf/d from the month prior. Rising utilization on Double E Pipeline and its recent growth in delivered volumes to Kinder Morgan's two intrastate lines comes as upstream activity in the Permian Basin continues to accelerate this year. Since the start of January, gas production from West Texas and eastern New Mexico has been on a tear, recently approaching a previous record high at a combined 14 Bcf/d as producers hit the accelerator this year. As of late January, an estimated 304 drilling rigs are currently in operation across the Delaware and Midland basins, just one shy of a late-December high and the most since April 2020, rig data from Enverus shows. Other upstream indicators are also looking bullish for production. In the six-month period ending in December, well completions in the Permian averaged about 400 per month – a sustained high unseen since the first quarter of 2021. New well boring also reached a pandemic-era high in December with a total of 315 wells drilled during the month – the most since April 2020, according to data from the US Energy Information Administration. Oil production has been the primary driver of recent growth. According to a short-term production forecast from the EIA, Permian output could hit a new record high by February at over 5 million b/d.

Oil Frackers Brace for End of the U.S. Shale Boom – WSJ -- The end of the boom is in sight for America’s fracking companies. Less than 3½ years after the shale revolution made the U.S. the world’s largest oil producer, companies in the oil fields of Texas, New Mexico and North Dakota have tapped many of their best wells.If the largest shale drillers kept their output roughly flat, as they have during the pandemic, many could continue drilling profitable wells for a decade or two, according to a Wall Street Journal review of inventory data and analyses. If they boosted production 30% a year—the pre-pandemic growth rate in the Permian Basin, the country’s biggest oil field—they would run out of prime drilling locations in just a few years. Shale companies once drilled rapidly in pursuit of breakneck growth. Now the industry has little choice but to keep running in place. Many are holding back on increasing production, despite the highest oil prices in years and requests from the White House that they drill more.The limited inventory suggests that the era in which U.S. shale companies could quickly flood the world with oil is receding, and that market power is shifting back to other producers, many overseas. Some investors and energy executives said concerns about inventory likely motivated a recent spate of acquisitions and will lead to more consolidation.Some companies say concerns about inventories haven’t factored into their decisions to keep output roughly flat. For several years before the pandemic, frustrated investors had pressured companies to slow production growth and return cash to shareholders rather than pump it back into drilling. Companies have promised to limit spending, though some executives recently said high prices signal a need for them to expand again this year.U.S. oil production, now at about 11.5 million barrels a day, is still well below its high in early 2020 of about 13 million barrels a day. The Energy Information Administration expects U.S. production to grow about 5.4% through the end of 2022.Big shale companies already have to drill hundreds of wells each year just to keep production flat. Shale wells produce prodigiously early on, but their production declines rapidly. The Journal reported in 2019 that thousands of shale wells were pumping less oil and gas than companies had forecast. Many have since marked down how many drilling locations they have left.Some shale companies will eventually have to start spending money to explore for new hot spots, executives and investors said, and even then, those efforts are likely to add only incremental inventory. Few are currently doing so. Pioneer Natural Resources Co. , the largest oil producer in the Permian Basin of West Texas and New Mexico, raised its oil production between 19% and 27% a year in shale’s peak years. Now, Pioneer is planning to increase output only 5% a year or lower, for the long term.Scott Sheffield, chief executive of Pioneer, said the combination of investor pressure and limited well inventory means he cannot drill as he once did. “You just can’t keep growing 15% to 20% a year,” he said. “You’ll drill up your inventories. Even the good companies.”

Oklahoma's oil regulator to shut some disposal wells following large quake -Oklahoma's oil and gas regulator said it would shut deep saltwater disposal wells on Jan. 31 and restrict others near where a large earthquake earlier in the day rattled homes and businesses in the northern part of the state.The quake had a magnitude of 4.5 on the Richter scale, regulator Oklahoma Corporation Commission said in a revised estimate. No damage had been reported, according to an official with the Grant County Sheriff Department.The tremor occurred near Medford, Oklahoma, in the north-central part of the state and home to oil and gas drilling. The OCC is ordering shut three disposal within six miles of the quake's epicenter and that other water disposal wells within 10 miles of the epicenter would be restricted to accepting an average volume of 500 barrels per day. Several years ago, Oklahoma suffered a sharp uptick in earthquakes tied to the disposal of saltwater, a natural byproduct of oil and gas production. The tremors had largely subsided in recent years after the OCC took measures to limit water disposal in quake-prone areas.Monday's quake occurred in an area where the OCC had previously shut down disposal due to an increase in quakes.West Texas is now grappling with a similar issue in its Permian Basin, the largest U.S. shale field. The state's Railroad Commission, which regulates its oil and gas industry, has taken steps in recent months to curb the frequency of earthquakes, including shutting some disposal wells. Texas Railroad Commissioner Jim Wright on Jan. 31 published a public letter addressing the increase in earthquakes in the Permian Basin. In it, he touted the benefits of recycling water and also said the RRC is working with operators to expedite the approval of additional shallow disposal wells, which are less likely to induce seismic activity.

Report: State policies allow oil and gas companies to skirt responsibilities for plugging and cleaning up abandoned wells - A new report says the state fails to hold companies responsible for the plugging and cleanup of their abandoned wells by allowing companies to use loopholes like keeping wells barely active to avoid having to plug them and offering tax incentives for low-producing wells and high-cost gas wells.“Eliminating Orphan Wells and Sites in Texas” is the latest in a series of publications released by the environmental organization Commission Shift about operations at the Texas Railroad Commission, which is charged with regulating oil and gas development, coal and uranium mining, and gas utility service in the state.The report asserts that Texas routinely takes on risks without collecting enough taxes and fees from the industry it oversees to deal with them.It says orphan wells are a problem throughout the state that will only get worse as “the oil and gas industry is exhibiting signs of systemic decline.”Approximately 9 million people in the U.S. live within one mile of an abandoned oil and gas well, which can emit harmful gasses that are amajor problem for the climate and disproportionately impact low-income communities of color.What constitutes an orphaned well? What are the potential financial and health implications of failing to responsibly plug and clean them up?What is the Texas Railroad Commission’s role when it comes to regulating oil and gas wells? How does the current system prevent industry accountability?What reforms could be implemented to fix Texas’ orphan wells problem? The Biden administration announced on Monday it will provide 26 states including Texas with funding to plug abandoned oil and gas wells. Is it enough?

Environmental group says analysis shows oil and gas companies have used ‘forever chemicals’ to frack wells across Colorado -- Companies have used potentially toxic "forever chemicals" to coax oil and gas from Colorado wells since at least 2008, according to a new report from Physicians for Social Responsibility. The environmental advocacy group also claims drillers may have concealed some dangerous chemicals they’ve pumped into wells under state rules that allow companies to withhold the disclosure of industry "trade secrets." Dusty Horwitt, one of the report’s authors, said the disclosure exemptions make it nearly impossible to know the full extent of the industry’s use per-and polyfluoroalkyl substances — also known as PFAS."Coloradans could be unknowingly exposed to these highly toxic forever chemicals, as they're called, from thousands of oil and gas wells across the state," Horwitt said. The claims could add another chapter to a rapidly expanding PFAS pollution crisis. The category of chemicals was born in 1938 when a chemist at DuPont stumbled upon polytetrafluoroethylene, a compound that later became famous as a nonstick cookware coating known as Teflon. Companies soon found other applications for the chemical’s slipperiness and ability to resist oil and water. The discovery fueled the development of other PFAS chemicals now used in a wide range of consumer products like dental floss, waterproof jackets and fire fighting foam. Over the last few decades, researchers have increasingly raised concerns about potential health threats. Peer-reviewed studies have found PFAS exposure can lead to an increased risk of fertility problems, high cholesterol, certain cancers and other health issues, according to the U.S. Environmental Protection Agency.While scientists haven't fully understood how PFAS endangers human health, it's clear the persistent chemicals have become an unavoidable part of modern life. Public health experts estimate 95 percent of Americans have traces of PFAS in their blood. A 2020 state sampling project found detectable levels of the chemicals in every river and stream sampled across Colorado.

Living near or downwind of unconventional oil and gas development linked with increased risk of early death – Elderly people living near or downwind of unconventional oil and gas development (UOGD)—which involves extraction methods including directional (non-vertical) drilling and hydraulic fracturing, or fracking—are at higher risk of early death compared with elderly individuals who don’t live near such operations, according to a large new study from Harvard T.H. Chan School of Public Health. The results suggest that airborne contaminants emitted by UOGD and transported downwind are contributing to increased mortality, the researchers wrote. The study will be published on January 27, 2022 in Nature Energy. “Although UOGD is a major industrial activity in the U.S., very little is known about its public health impacts. Our study is the first to link mortality to UOGD-related air pollutant exposures,” said Petros Koutrakis, professor of environmental sciences and senior author of the study. Added co-author Francesca Dominici, Clarence James Gamble Professor of Biostatistics, Population, and Data Science, “There is an urgent need to understand the causal link between living near or downwind of UOGD and adverse health effects.”

U.S. Drilling Activity Rises on Strength of Williston Growth, Says Baker Hughes -Driven by strong growth in the Williston Basin, the U.S. oil and gas rig count climbed three units to 613 during the week ended Friday (Feb. 4), according to the latest figures published by oilfield services provider Baker Hughes Co. (BKR). Gains in the United States included two oil-directed rigs and one natural gas-directed unit. The combined U.S. count ended the week 221 units ahead of its year-earlier total of 392, according to the BKR numbers, which are partly based on data from Enverus. Land drilling increased by five units for the period, while the Gulf of Mexico count fell two units to 16, flat year/year. Three vertical units and two horizontal units were added during the week, partially offset by a two-rig decrease in directional drilling. The Canadian rig count climbed one unit to 218, up from 171 a year ago, with the net change reflecting an uptick in oil-directed drilling for the period. Broken down by major basin, the Williston posted the largest week/week gain, picking up four rigs to grow its total to 31, up sharply from 12 in the year-earlier period. Elsewhere among plays, the Granite Wash, Permian Basin and Utica Shale each added one rig to their respective totals. The Arkoma Woodford, Cana Woodford and Marcellus Shale each dropped a rig. In the state-by-state count, BKR recorded gains of three rigs each in North Dakota and Texas, with Alaska adding two rigs for the period to end with eight overall. Ohio and West Virginia each added one rig for the period. On the other side of the ledger, Louisiana, New Mexico and Pennsylvania each saw two rigs exit week/week, while California and Oklahoma each posted one-rig declines for the period, the BKR numbers show. Gains in the United States included two oil-directed rigs and one natural gas-directed unit. The combined U.S. count ended the week 221 units ahead of its year-earlier total of 392, according to the BKR numbers, which are partly based on data from Enverus. Land drilling increased by five units for the period, while the Gulf of Mexico count fell two units to 16, flat year/year. Three vertical units and two horizontal units were added during the week, partially offset by a two-rig decrease in directional drilling.

Study: Toxic fracking waste is leaking into California groundwater - Chevron has long dominated oil production in Lost Hills, a massive fossil fuel reserve in Central California that was accidentally discovered by water drillers more than a century ago. The company routinely pumps hundreds of thousands of gallons of water mixed with a special concoction of chemicals into the ground at high pressure to shake up shale deposits and release oil and gas. The process — called hydraulic fracturing, or fracking — produces thousands of barrels of oil every day. But it also leaves the company saddled with millions of gallons of wastewater laced with toxic chemicals, salts, and heavy metals. Between the late 1950s and 2008, Chevron disposed much of the slurry produced in Lost Hills in eight cavernous impoundments at its Section 29 facility. Euphemistically called “ponds,” the impoundments have a combined surface area of 26 acres and do not have synthetic liners to prevent leaking. That meant that over time, salts and chemicals in the wastewater could leak into the ground and nearby water sources like the California Aqueduct, a network of canals that delivers water to farms in the Central Valley and cities like Los Angeles. And that’s exactly what happened, according to new research published in the academic journal Environmental Science & Technology this month. Carcinogenic chemicals like benzene and toluene as well as other hydrocarbons have been detected within a half a kilometer of the facility. About 1.7 kilometers northwest of the facility, chloride and salt levels are more than six times and four times greater than background levels, respectively. The research leaves little doubt: The contaminants are migrating toward the aqueduct. “At the section 29 facility, you have to go 1.8 kilometers away from the facility to find background water quality. That’s pretty far.” The facility shuttered in 2008, and it no longer accepts wastewater. Chevron has continued to monitor the contaminant plume and submits yearly water quality reports to the Central Valley Regional Water Quality Control Board, a local groundwater quality regulator. In a 2019 report, the company claimed it would cost more $800,000 to monitor the plume and report to the regulator for the next 30 years. The Section 29 facility isn’t an isolated case. Between 1977 and 2017, over 16 billion barrels of oilfield wastewater was disposed in unlined ponds in California. The vast majority of these are located outside of Bakersfield in the state’s Central Valley: According to DiGiulio’s research, there are at least 1,850 wastewater ponds in the San Joaquin Valley’s Tulare Basin. Of those, 85 percent are unlined and about one-fourth are active, like the Section 29 facility. However, despite not being operational, many of them may be leaking into the ground. Wells that monitor groundwater quality are few and far between, so it’s difficult to know the exact scope of the pollution. But DiGiulio warns that the ponds constitute “a potential wide-scale legacy groundwater contamination issue.” This month’s study is the first to quantify the number of unlined pits in California and analyze their effects on groundwater. The findings bolster 2015 research by California Council on Science & Technology and the Lawrence Berkeley National Laboratory, which concluded that unlined wastewater pits posed a threat to groundwater sources and called for investigations into whether contaminants have leaked from disposal ponds. Research conducted by the United States Geological Survey for the Central Valley Water Board has also found evidence of oil and gas wastewater contaminating groundwater.

Calif. weighs help for oil workers in green future - California officials are brainstorming how to help oil industry workers as the state moves to phase out fossil fuels and replace gasoline-powered vehicles with electric cars. Democratic Gov. Gavin Newsom’s office and legislators are talking to unions representing industry workers, and a new state Assembly document outlines potential solutions. But it’s a complex quandary, raising questions about whether to guarantee workers their current salaries and benefits as their jobs disappear. “One of the major hurdles in transitioning existing fossil fuels activities to clean energy ones has been the potentially negative economic consequences to workers and communities,” according to a document from the Assembly Office of Policy and Research obtained by E&E News. “As the state implements its ambitious climate goals, there is an opportunity to assist workers impacted by the transition to a green economy.” Nearly 112,000 people work in 14 fossil fuel and ancillary industries in California as of 2018, according to a report last year from the Political Economy Research Institute (PERI) at University of Massachusetts, Amherst. The total includes oil and gas extraction operations, and support activities, and sectors such as fossil-fuel-based power generation. What California decides to do about oil industry workers has the potential to ripple beyond the nation’s most populous state, said Catherine Houston, legislative, political and rapid response coordinator with United Steelworkers District 12.That union represents many oil industry workers. “California typically takes the lead in a lot of these types of things, and we become an example for other states across the nation,” Houston said. “So whatever we do can potentially serve as a federal model.”

Biden Administration Announces $1.15 Billion to Plug Abandoned Oil and Gas Wells -The Biden Administration announced new actions Monday to tackle methane pollution. The measures include $1.15 billion in funds from the Department of the Interior that states can use to close up abandoned oil and gas wells. The funding comes from President Joe Biden’s Bipartisan Infrastructure Law, which set aside $4.7 billion for a federal program dedicated to orphaned wells. “President Biden’s Bipartisan Infrastructure Law is enabling us to confront the legacy pollution and long-standing environmental injustices that for too long have plagued underrepresented communities,” Interior Secretary Deb Haaland said in a press release. “We must act with urgency to address the more than one hundred thousand documented orphaned wells across the country and leave no community behind. This is good for our climate, for the health of our communities, and for American workers.” There are 130,000 documented abandoned oil and gas wells in the U.S, the Interior Department calculated last month, as The Washington Post reported. However, in 2018 the Environmental Protection Agency (EPA) estimated that there might really be as many as two to three million orphaned wells. About nine million people live within a mile of an abandoned well, according to a study from McGill University and the Environmental Defense Fund (EDF), and these wells can emit a variety of gasses including methane. “It’s a pretty big problem that’s flown under the radar for a long time,” EDF senior attorney Adam Peltz, who approved of the new measures, told The Washington Post. In addition to preventing climate pollution and protecting the health of vulnerable communities, plugging wells can also provide unionized, well-paying jobs, the Interior Department said. The money will be sent to 26 states that submitted notices of intent last year, CNBC reported, including $100 million for Texas and Pennsylvania.Some environmental advocates thought that the administration could go further to address the problem caused by abandoned wells. “Addressing these existing wells is an important first step,” Sierra Club deputy legislative director Mahyar Sorour said, as CNBC reported. “But unless it’s paired with bonding reform that requires oil and gas companies to cover these costs up front, the industry will continue to leave behind toxic wells on our public lands and expect taxpayers to cover the cost of cleaning them up.” The Biden Administration championed the Global Methane Pledge last year, which calls for a 30 percent reduction in 2020 methane emissions by 2030, according to a White House fact sheet. The U.S. helped mobilize more than 110 countries to sign the pledge. President Biden also announced the U.S. Methane Emissions Reduction Action Plan at the COP26 climate conference last year.

DOI announces $1.5B in funding for orphaned well clean up - The Department of the Interior announced $1.15 billion in funding is available to states from the Bipartisan Infrastructure Law to create jobs cleaning up orphaned oil and gas wells across the country. This is a key initiative of President Biden’s Bipartisan Infrastructure Law, which allocated a total of $4.7 billion to create a new federal program to address orphan wells. Millions of Americans across the country live within a mile of an orphaned oil and gas well. Orphaned wells are polluting backyards, recreation areas, and public spaces across the country. The historic investments to clean up these hazardous sites will create good-paying, union jobs, catalyze economic growth and revitalization, and reduce dangerous methane leaks. “President Biden’s Bipartisan Infrastructure Law is enabling us to confront the legacy pollution and long-standing environmental injustices that for too long have plagued underrepresented communities,” said Secretary Deb Haaland. “We must act with urgency to address the more than one hundred thousand documented orphaned wells across the country and leave no community behind. This is good for our climate, for the health of our communities, and for American workers.” Plugging orphaned wells will also help advance the goals of the U.S. Methane Emissions Reduction Action Plan, as well as the Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization, which focuses on spurring economic revitalization in the hard-hit energy communities. Nearly every state with documented orphaned wells submitted a Notice of Intent (NOI) indicating interest in applying for a formula grant to fund the proper closure and cleanup of orphaned wells and well sites. The Department today released the amount of funding that states are eligible to apply for in Phase One, which includes up to $25 million in Initial Grant funding and a quarter of the total Formula Grant money available for the 26 states that submitted NOIs. These allocations were determined using the data provided by states from the NOIs and equally considers the following factors required by the Bipartisan Infrastructure Law: job losses in each state from March 2020 through November 2021; the number of documented orphaned oil and gas wells in each state; and the estimated cost of cleaning up orphaned wells in each state.

Biden is sending more than $1 billion to states to plug abandoned oil and gas wells - The Biden administration on Monday announced it will send $1.15 billion to states to plug thousands of orphan oil and gas wells that emit methane, a potent climate-changing greenhouse gas.Methane is a main component of natural gas and accounts for 10% of U.S. greenhouse gas emissions. The oil and gas industry represents nearly 30% of the country's methane emissions.Methane is 84 times more potent than carbon and doesn't last as long in the atmosphere before it breaks down, which makes it a significant target for reducing global warming more quickly while simultaneously working to reduce other greenhouse gases.The funding to plug oil and gas wells comes from President Joe Biden's bipartisan infrastructure bill, which allocated a total of $4.7 billion to form a new federal program to address the thousands of wells abandoned across the country.Interior Secretary Deb Haaland said in a statement that the funding enables the government to "confront the legacy pollution and long-standing environmental injustices that for too long have plagued underrepresented communities.""We must act with urgency to address the more than one hundred thousand documented orphaned wells across the country and leave no community behind," Haaland said. "This is good for our climate, for the health of our communities, and for American workers." The money will go to the 26 states that submitted notices of intent to the Department of Interior last year, including more than $100 million each for Pennsylvania and Texas. Roughly 9 million people live within a mile of an abandoned oil and gas well, some of which emit harmful gases that disproportionately impact low-income communities of color in the U.S.

Satellite Images Revealed Russia, US Are Major Sources of Methane Leak - Experts ran satellite images through an algorithm to automatically discover the world's largest methane plumes coming from oil and gas facilities all over the world. Around a tenth of the oil and gas industry's methane emissions come from "ultra-emitter" locations predominantly in Turkmenistan, Russia, and the United States, according to researchers. Methane is a powerful greenhouse gas and governments have just agreed to reduce emissions of the strong greenhouse gas methane by 2030, as per New Scientist. While satellites have detected large plumes of methane escaping from particular gas pipes, such as an Ohio gas well and numerous pipelines in Turkmenistan's central region, nothing is known about the global scale of these leaks. The largest methane plumes emanating from oil and gas installations across the world can now be detected using photos taken by a satellite instrument and an algorithm. More than 25 metric tons of methane per hour are being pumped out of these ultra-emitters. Environmental Defense Fund (EDF), an American non-profit organization in Washington DC, argues that's a lot. The oil and gas industry's 2019-20 methane emissions are expected to be around 8 million metric tons, or tenth of that amount. Over a two-year period, Turkmenistan was the most significant ultra-emitter, producing more than a million metric tons of methane. At slightly under a million tonnes, Russia was in second place followed by Iran, Algeria, and Kazakhstan.

The Oil Industry Has a $500 Billion Bubble Problem --- Oil prices are rebounding as global economic activity picks back up. But the boom could likely be a mirage as governments finally get their act together on climate change—and it could lead to financial ruin if Big Oil ends up chasing it.A new report from Carbon Tracker, a London-based think tank, found that if the industry takes the bait and tries to wring more oil and gas out of the ground, it could end up strapped with more than $500 billion in stranded assets. (And let’s not even get started on the damage to the climate.)From a business standpoint, the industry clearly sees dollar signs with high prices and rebounding demand. But could create what Axel Dalman, a lead author of the report, said in a press release would be a “nightmare scenario if they go ahead with projects which deliver oil around the time that demand starts to decline.”World leaders are well aware at this point that the end of the fossil fuel era needs to start, and soon. If not, humanity could face catastrophic consequences. The report finds that as governments start to (hopefully) get serious about winding down the fossil fuel industry to protect the climate, it could leave oil companies and shareholders holding the bag.“As the world transitions away from oil and gas, [companies] run the risk of destroying significant value as a result of failing to deliver the expected return results,” said Mike Coffin, co-author of the report. “For investors, this means ensuring that they engage with companies and that companies are ultimately stewarding that capital appropriately, and are not investing and wasting money on products that run the risk of becoming stranded assets as demand falls away in the next decade.”Carbon Tracker’s suggestion to these companies and the shareholders? Resist the temptation to go all in on projects because this peak demand can’t and won’t last forever. The report predicts that some fossil fuel companies and their shareholders may only have a few years to really cash in on their investments at peak or near peak demand before oil prices come back down to earth by the end of this decade. Some may reap in a return while prices are still high, but it’s likely that many won’t as governments around the world invest in cleaner infrastructure and demand for electric vehicles goes up. That demand is expected to go up more than 30% by 2030, Carbon Tracker noted in the report.The report findings also show why the world needs a solid plan for winding down the industry. An unmanaged decline could drive billions in losses, hurt workers, and still potentially screw the climate in the end if a few companies end up trying to squeeze every last drop of oil they can out of the ground.

Canada's Questerre studying new completion technique - Canadian producer Questerre Energy has commissioned a study and report on a new completion technique to replace conventional hydraulic fracturing, the company said February 1. By using lower pressures and rates than the standard currently used for fracturing new rock, the technique takes advantage of existing natural fractures to stimulate the formation. The technique is similar to an approach utilised in geothermal projects. Maurice Dusseault, professor of engineering geology at the University of Waterloo, has been engaged to conduct the study. Dusseault was on the direction committee for the strategic environmental assessments completed by the government of Quebec. “This new technique could be incredibly effective in a naturally fractured formation like the Quebec Utica,” Questerre CEO Michael Binnion said. “Subject to new legislation, we hope to apply to complete two wells in Quebec to prove the efficacy of this new approach.” Quebec has implemented a moratorium on fracking in the province, essentially stranding an estimated contingent resource of nearly 6 trillion ft3 of natural gas Questerre holds in the Utica shale beneath the Quebec Lowlands. Questerre has been pursuing a variety of initiatives to eventually produce this resource, including various blue hydrogen and carbon capture and storage opportunities, but so far, those proposals have fallen on deaf government ears, Binnion said. “We encourage the government to reconsider the benefits of our zero-emissions project to meet their climate goals.”

Mexico likely to cut oil exports to Europe, Asia after new refinery starts -Valero - Mexico’s state-run Petroleos Mexicanos would likely reduce oil sales to Europe and Asia before the United States, its main market for oil exports, after its Dos Bocas refinery begins operations, a Valero Energy Corp executive said on Thursday. Pemex in December said its crude exports will fall to 435,000 bpd this year from 1.019 million bpd in 2021 and it plans to cease all crude exports after its 300,000-barrel-per-day Dos Bocas refinery in the southeastern state of Tabasco begins processing crude next year. Pemex was not immediately available to respond to the Valero executive’s comments. Analysts expect that the exports decline – which has not yet been included in the budget Mexico’s congress approved for 2022 – would primarily affect customers that buy Mexican crude on the spot market, including many in Asia. “It looks like their (Pemex) goals are pretty aggressive,” said Gary Simmons, Valero’s chief commercial officer, during the firm’s fourth quarter earnings call on Thursday. The Texas-based refining company, which is among the U.S. top importers of heavy crude, expects to continue its business relationship with Pemex, he added. “Our experience has been that as they increase refinery runs in Mexico, they increase the export of high-sulfur fuel oil, and that’s a good feedstock for our high complexity U.S. Gulf Coast (refinery) system,” he said. Pemex also plans to reshuffle fuel imports after buying Shell’s 50%-stake in the Deer Park refinery in Texas, which will give it access to up to 230,000 bpd of U.S. fuels. Source: Reuters (Reporting by Erwin Seba and Marianna Parraga; Editing by Alexandra Hudson)

Italy rejects extradition of Venezuela's ex-oil minister, says lawyer -– Italy has rejected a request by Venezuela for the extradition of Rafael Ramirez, a once powerful oil minister and former head of state oil company Petroleos de Venezuela, his lawyer said on Saturday. Authorities in Venezuela had asked Interpol to locate and arrest Ramirez in 2018 and subsequently demanded his extradition from Italy in 2020 in connection with embezzlement charges. Ramirez, who denies the corruption allegations, says President Nicolas Maduro’s administration is seeking to smear him over his anti-government comments. “The Italian Supreme Court has declared definitively inadmissible the extradition request,” Ramirez’s Italian lawyer Roberto De Vita told Reuters. He said the court had backed a previous ruling that Ramirez could not be sent back to Venezuela because of human rights violations in the South American state. Court rulings in Italy are initially delivered to those involved in the case and the verdict has not yet been published on the Supreme Court website. Ramirez served for a decade as oil minister and president of state oil company PDVSA, which controls some of the largest crude reserves in the world. Venezuela’s Supreme Court said on Facebook in 2020 that Ramirez faced criminal charges including embezzlement and bid-rigging for oil contracts. He was ousted from his post as Venezuela’s U.N. envoy in 2017 after publicly criticizing Maduro and the status of the OPEC nation’s oil industry.

UK Gas Production Could Plunge 75% By 2030 - The UK could become much more vulnerable to price shocks and geopolitical events unless new offshore fields are approved and developed—and the UK’s gas production could plummet by 75 percent by 2030, the offshore energy industry body OGUK said on Thursday. Without new investment in new gas fields in the North Sea, the UK will be left more vulnerable to crisis, such as the current one between Russia and Ukraine, the industry association noted. Additional price shocks would add to the ongoing energy crisis in the UK where gas and power suppliers are going bust, while customers face a cost-of-living crisis when the energy market regulator Ofgem raises the price cap on energy bills as of April 1. The worst is yet to come for consumers in April, when millions of households would be thrown into energy poverty, with many people having to choose between eating and heating. Domestic production currently meets 47 percent of the UK’s gas demand, 31 percent comes from pipeline imports from Europe, mostly from Norway, and 21 percent from LNG imports. In 2020, Russia supplied 3.4 percent of the UK’s gas, OGUK said. According to the industry body, new fields are needed in the UK North Sea to stave off a predicted 75-percent plunge in domestic supplies if no new fields are approved. Many fields remain to be tapped, according to geological surveys. Such fields are estimated to contain oil and gas equivalent to 10-20 billion barrels of oil—enough to sustain production for 10-20 years, OGUK said. “In the longer term, if UK gas production is allowed to fall as predicted, then our energy supplies will become ever more vulnerable to global events over which we have no control – as we now see happening with Russia’s threatened invasion of Ukraine,” OGUK Energy Policy Manager Will Webster said on Thursday.

Nord Stream 2: Russia-Germany gas pipeline becomes a geopolitical lever - The crisis surrounding Ukraine has been a harsh reminder to Europeans of just how dependent they are on Russian energy supplies. While the European Union weighs its options for a united and robust response to Russia if Vladimir Putin decides to invade Ukraine, the bloc is feeling a new sense of unease over its dependence on Russian oil and gas. Mounting tensions over a Russian troop buildup along the Ukrainian border has turned the spotlight back onto the controversial Nord Stream 2 project, a more than 1,200-kilometre gas pipeline running from western Russia to northeastern Germany under the Baltic Sea, which was completed in late 2021. If the pipeline – a joint project involving a consortium of Russian, German, Dutch and French energy companies – is given the green light from Brussels to become operational, it will be able to pump 55 billion cubic metres of gas to Germany each year. But the current diplomatic crisis with Russia is complicating the pipeline’s future. If Russia invades Ukraine, “the decision to halt Nord Stream 2 would be part of the EU’s political or military strategy”, said Anna Creti, director of the Climate Economics department of Paris Dauphine University, in an interview with FRANCE 24. “But it cannot be done unilaterally; it would need the agreement of the entire consortium.” In the long-term contract concerning Nord Stream 2, “we have Russia’s national company Gazprom on one side, and on the other we have several European companies that have to bargain, gain or modify clauses", Creti said. "The EU is not just one stakeholder and Russia can bargain with the [respective] companies – and possibly play one against the other." On the other hand, “if Russia decides to stop the flow of gas to Europe, it wouldn’t be overnight”, said Creti, adding that a complete interruption of energy supplies would be unlikely given the safety risks of suddenly stopping gas flows. A more likely scenario would be for Russia to further decrease the flow of gas over a few weeks, sending a very clear signal to Europeans that their supply is in danger, according to Creti.

Critical German Oil Network Hit With Cyberattack Amid Rising US-Russian Tensions The energy crisis surrounding Europe worsened as Germany's fuel-supply network was hit with a cyberattack on Jan. 29. The incident follows mounting tensions between the US and Russia over Ukraine and the possibility Nord Stream 2 pipeline from Russia to Germany could be axed if Russia invades Kyiv. The US has insisted it would block the pipeline opening upon a Russian invasion of Ukraine. Western governments and their corporate media counterparts aren't helping the situation as they drum up the prospects for conflict between Russia and the US. This week, it just so happened a cyberattack partially paralyzed Germany's most critical fuel network as the geopolitical turmoil worsened in the region. S&P Global Platts reports the attack targeted energy company Mabanaft Group and storage company Oiltanking Group. Disruptions to some oil products in Germany, Europe's biggest oil consumer, are being reported. Oiltanking declared force majeure at eleven terminals in Germany and was operating at "limited capacity." "All parties continue to work to restore operations to normal in all our terminals as soon as possible," both companies said in a joint press release. Traders told S&P Global Platts the cyberattack might last for upwards of two weeks as the companies are expected to "just pay off the blackmailers."

What if Russia turns off the gas? Europe assesses its options amid Ukraine crisis -- Escalating tensions between Russia, Ukraine and the West have heightened concern about the future of Russian gas flows to the European Union, with lawmakers and energy providers scrambling to prepare contingency plans. It comes as President Joe Biden warns there is a "distinct possibility" Russia could invade Ukraine as soon as next month and as the Kremlin says there is "little ground for optimism" after the U.S. rejected its main demands to resolve the crisis. Russia has amassed an estimated 100,000 troops near the border of Ukraine but denies planning to enter the former Soviet republic. "European natural gas supplies are well below their typical norms and inventories, so a key question to ask is if Europe has enough natural gas inventory to survive," For several months, Russia has been accused of intentionally disrupting gas supplies to leverage its role as a major energy supplier to Europe amid an escalating dispute with Ukraine. Russian gas flows to Europe have been lower than typically expected for a sustained period, with political analysts suggesting that Moscow has purposefully withheld supplies in a bid to speed up certification of the highly contentious Nord Stream 2 pipeline. Indeed, Russia's purported role in exacerbating Europe's energy crunch was even the subject of a rare public rebuke from the International Energy Agency, with the group calling on Russia to increase gas availability to Europe and ensure storage levels were filled to adequate levels during a period of high winter demand. The Kremlin has repeatedly disputed claims it is using gas as a geopolitical weapon, with state-owned Gazprom saying it has fulfilled its contractual obligations to customers. Now, as Russia-Ukraine tensions reach a fever pitch, energy analysts are deeply concerned about the risk of full supply disruption to the EU — which receives roughly 40% of its gas via Russian pipelines and several of which run through Ukraine. The prospect of a supply cut-off of Russian gas is seen as likely to result in profound public health and economic consequences, particularly as such a scenario could come in the middle of winter and amid the coronavirus pandemic. Energy analysts at political risk consultancy Eurasia Group believe the worst-case scenario of Russia abruptly cutting off all supplies to Europe is also the least likely scenario. This is partly because such a move would have major financial costs for Moscow, while simultaneously triggering a coordinated effort by EU states to permanently reduce gas imports from Russia. "Even if a full disruption of Russian gas exports to the EU remains unlikely, officials and energy providers there have been making contingency plans," analysts at Eurasia Group said. For example, European utilities have increased orders of shipped liquefied natural gas cargoes over the Christmas and New Year period, chiefly from the U.S. and Qatar, which have around 100 cargoes scheduled to arrive in Europe in January alone. Eurasia Group said, citing ship tracking data, that this reflected an increase of roughly 40% from the previous record in March 2021.

Russia, China agree 30-year gas deal via new pipeline, to settle in euros - (Reuters) - Russia has agreed a 30-year contract to supply gas to China via a new pipeline and will settle the new gas sales in euros, bolstering an energy alliance with Beijing amid Moscow's strained ties with the West over Ukraine and other issues. Gazprom, which has a monopoly on Russian gas exports by pipeline, agreed to supply Chinese state energy major CNPC with 10 billion cubic metres of gas a year, the Russian firm and a Beijing-based industry official said. First flows through the pipeline, which will connect Russia's Far East region with northeast China, were due to start in two to three years, the source said in comments that were later followed by an announcement of the deal by Gazprom. Russia already sends gas to China via its Power of Siberia pipeline, which began pumping supplies in 2019, and by shipping liquefied natural gas (LNG). It exported 16.5 billion cubic metres (bcm) of gas to China in 2021. GRAPHIC - Russia-China plan new gas pipeline https://fingfx.thomsonreuters.com/gfx/ce/mopanywylva/RussiaChinaGasPipeline.png The Power of Siberia network is not connected to pipelines that send gas to Europe, which has faced surging gas prices due to tight supplies, one of several points of tension with Moscow. Under plans previously drawn up, Russia aimed to supply China with 38 bcm of gas by pipeline by 2025. The new deal, which coincided with a visit by Russian President Vladimir Putin to the Beijing Winter Olympics, would add a further 10 bcm, increasing Russian pipeline sales under long-term contracts to China. Gazprom gave few details about the deal in its announcement. Russian gas from its Far East island of Sakhalin will be transported via pipeline across the Japan Sea to northeast China's Heilongjiang province, reaching up to 10 bcm a year around 2026, said the Beijing source, who asked not to be identified. The deal would be settled in euros, the source added, in line with efforts by the two states to diversify away from U.S. dollars. Discussions between the two firms began several years ago after the start-up of Power of Siberia, a 4,000-km (2,500-mile)pipeline sending gas to China. Talks accelerated more recently after Beijing set its 2060 carbon neutral goal, the source said. "China's coal shortage last year served as another wake-up call that natural gas has its special value, that's why CNPC decided to top up with the new pipeline deal," the source said.

As Europe seeks alternatives to Russian gas, Algeria has pipeline capacity to spare - The European pursuit to secure energy supplies puts Algeria firmly in the spotlight, as the EU’s third largest gas provider behind Russia and Norway. The country, which has pipelines across the Mediterranean Sea to Spain and Italy, as well as an LNG terminal, exported about 34 billion cu m of gas to the EU in 2021, or 8% of the union’s total imports, according to Eurostat. Any increase in Algerian volumes would not come anywhere close to offsetting a complete shutdown of Russian imports, which totaled about 130 billion cu m in 2021, but it would provide some measure of relief to a continent already facing tight supplies and soaring energy prices this winter. Having boosted output by bringing several projects online over the last few years, Algeria stands ready to tap its spare production and pipeline capacity to increase exports to the continent, if called upon, a government official told S&P Global Platts. But growing domestic gas consumption and the country’s political instability could put a damper on what Algeria may be able to provide, experts said. “The country has major problems in relation to increasing supply in the context of rising domestic demand,” Western governments, led by the Biden administration, have threatened to impose harsh sanctions on Russia, including its energy sector, if it invades Ukraine, potentially choking off the source of some 40% of European gas imports. The new Nord Stream 2 pipeline, which would send Russian gas to Germany, is among the projects in the sanctions’ crosshairs. Platts Analytics estimates Algeria could provide an additional 7 billion cu m of gas to Europe in 2022, largely through higher shipments via the Transmed pipeline to Italy. Other incremental exports could go through a recent expansion of the Medgaz pipeline to Spain and possibly some more LNG cargoes, said the government official, who spoke on condition of anonymity to discuss commercially and politically sensitive matters. Reopening the GME pipeline through Morocco to Spain would restore another export valve, but the political dispute that shuttered its operations in November remains unresolved, and the government official declined to say whether Algeria was facing US or EU political pressure to resume gas flows.

Peru bars Repsol executives from leaving country after oil spill - Peruvian judicial authorities have decided to temporarily bar top executives of Spanish firm Repsol from leaving the country in the wake of a major oil spill that has polluted the coast and sea north of the capital Lima. The 18-month ban applies to Jaime Fernandez-Cuesta, executive director of Repsol Peru, and three other company directors -- Renzo Tejada, Gisela Posadas and Jose Rey, reports Xinhua news agency. Fernandez-Cuesta is to be investigated for his responsibility in the pollution of the environment, while the others are accused of complicity, according to local presiding judge Romualdo Aguedo. The January 15 oil spill occurred when a ship unloaded into a pipeline at the La Pampilla refinery operated by Respol in Ventanilla, Peru. The Spanish multinational initially said only seven gallons of crude spilled, attributing the accident to abnormal waves along the Peruvian coast following a volcanic eruption occurred in Tonga, the Pacific Ocean country. Peru's Environment Ministry estimated on Friday that about 11,900 barrels of crude have leaked into the ocean.

24 Peruvian beaches now affected by oil spill - La Prensa Latina Media - The Jan. 15 oil spill at a Peruvian refinery operated by Spain’s Repsol has contaminated at least 24 beaches along the country’s central coastline, according to the latest report by the Digesa environmental health and food safety directorate, which is part of the Peruvian Health Ministry. In a communique released Sunday on the social networks, the agency said that so far 24 beaches have been affected by the floating oil that has spread from the La Pampilla refinery, located in the Ventanilla district in Callao province, all the way to Peralvillo beach, in the municipality of Chancay. “The environmental disaster has continued to spread from the beaches of the Ventanilla district to the coasts in the district of Chancay, with reports being received of contamination of the water and sand at 24 beaches,” Digesa said, raising the number of damaged beaches from 21 – as in its penultimate statement – to two dozen. The environmental catastrophe, which the Peruvian government has called “the worst ecological disaster” to have occurred in Lima in recent years, has already affected some 100 kilometers (62 miles) of coastline, with the oil slick now covering an area of approximately 11.9 sq. km (4.6 sq.mi.), both sea and coast, according to a report issued Friday by the Environment Ministry. Given this scenario, Digesa urged regional authorities to restrict public use of the contaminated beaches until clean-up work can be done and recommended that the public not go to the zones affected by the spill since those spots “represent a serious health risk.” According to Repsol, the amount of crude that spilled has been tallied at 10,396 barrels, a figure significantly higher than the 6,000 barrels the company had mentioned in previous days and slightly below the 11,900 barrels estimated by the Environment Ministry. Initially, the Spanish firm reported that just 0.16 barrels (about 6.6 gallons) of oil had spilled. Given the differing reports, the Peruvian Foreign Ministry on Saturday night accused Repsol of having “shown a probably deceitful attitude,” adding that the government “will announce (the imposition of) a drastic sanction” on the firm. “Information about the true quantity of barrels of petroleum spilled at Ventanilla verifies the ecocide and reveals Repsol’s lack of transparency,” the Foreign Ministry said on the social networks. In addition, Peru’s Agency for Environmental Assessment and Enforcement (OEFA) said that Repsol has failed to implement on time the first series of measures ordered to clean up the oil spill and warned that the firm is risking huge fines that could total 226 million soles (about $59 million).

Peru halts oil activities at Repsol refinery in wake of spill - The Peruvian government on Monday halted all activities involving vessels loading and unloading oil at the La Pampilla refinery, operated by Spanish petroleum firm Repsol, after on Jan. 15 at least 10,396 barrels of crude were inadvertently spilled into the ocean, contaminating at least two dozen of the country’s beaches. Peruvian Environment Minister Ruben Ramirez made the announcement at a press conference, saying that “Repsol has not provided the certainty that it can deal with a new spill” at La Pampilla, Peru’s largest refinery processing some 120,000 barrels of petroleum per day. Ramirez said that this suspension of activity will be maintained until the firm provides Peruvian authorities with “the technical guarantees that another (spill) will not occur in the sea,” guarantees that include modifying contingency plans and undertaking additional more drastic measures. In addition, Repsol must present “a management plan for ocean oil spills” and its facilities will have to be certified once again by the appropriate authorities to validate their safety and integrity. The suspension, which was ordered in a resolution issued by Peru’s Environmental Evaluation and Enforcement Agency (OEFA), includes La Pampilla’s four maritime terminals for supplying crude, including the modern mono-buoy mooring installed in 2019, the first of its kind in the South American country. It was at Terminal No. 2 of the second type where the accident causing the catastrophic spill occurred during an unusually high ocean level due to the tsunami created by the recent eruption of the volcano in Tonga. Meanwhile, the Mare Doricum oil tanker involved in the spill remains anchored in the Bay of Callao under orders not to move from the site and the posting of a bond for 150 million soles (about $39 million). The crude that spilled during the accident has spread over some 50 kilometers (31 miles) of coastline from Ventanilla, in Callao province, the port region near Lima, to the town of Chancay, in the northern part of Lima province.

Death toll of seabirds in Peru oil spill continues to grow - Peru’s Sernanp environmental protection agency said Wednesday that its response teams are still finding dead seabirds covered in oil in the wake of the Jan. 15 accident that spilled 10,396 barrels of crude into the Pacific Ocean. Besides maintaining a register of the dead birds, the teams are “rescuing those that are seriously affected by the oil and we take them to the National Forest and Wildlife Service of Peru, which has set up an area for veterinary attention,” Sernanp investigator Roberto Gutierrez told Efe. The agency is carrying out daily surveys in the Islotes Pescadores (Fishermen’s Islands) natural preserve in the Ancon district, 40 km (25 mi) from Lima. Since Jan. 18, Sernanp has counted 170 seabirds that died as a result of the disaster at the La Pampilla refinery in Callao, the port city adjacent to the capital. The oil spill occurred when freak waves from a tsunami-triggering volcanic eruption near the faraway island nation of Tonga rocked the Mare Doricum tanker as it was unloading nearly 1 million barrels of crude. Measuring the impact of the spill on the environment is a massive challenge “that will take a long time and is complex,” Gutierrez said. “There are effects of the accident that aren’t visible now and will be later, especially the presence of heavy metals and toxins in the bodies of animals, as it is already leading to poisoning of birds that are consuming contaminated water and fish,” he said. Sernanp has brought 22 marine birds, including gannets, cormorants and penguins to veterinarians for treatment. And the agency warns that the damage from the spill threatens to drive a “local extinction” of sea otters, an endangered species. “But along with mammals and birds, the environmental tragedy affects crustaceans, arthropods, conchs, clams and sea urchins, to name a few examples,” Gutierrez told Efe. The crude spread across 11.9 sq km (4.59 sq mi) of water and beaches, according to the Peruvian government.

Repsol Says Peru Oil Spill Will Be Cleaned Up In March Spanish energy giant Repsol on Thursday vowed to finish by March cleaning up a devastating oil spill that has polluted beaches and killed wildlife. Almost 12,000 barrels of crude spilled into the sea off Peru on January 15 as a tanker unloaded oil at a Repsol owned refinery. "We expect that if the weather allows us then, in mid-March" the cleaning of beaches and islands off the coast will be completed, Repsol's environmental security director Jose Terol told reporters. However, he warned that it would take a little longer to finish cleaning cliffs and rocks that are difficult to access. "By mid-February, there will already be no more slicks in the sea. In an optimistic scenario, work on the difficult to access areas will be finished by the end of March," said Terol. Peru's government described the spill -- which Repsol blamed on freak waves caused by a volcanic eruption more than 10,000 kilometers away near Tonga -- as an "ecological disaster." The oil slick has been dragged by ocean currents about 140 kilometers north of the refinery, prosecutors said, causing the death of an undetermined number of fish and seabirds. Peru has demanded compensation from Repsol, and the energy giant faces a potential $34.5 million fine, the Environment Ministry has said. Even as the Repsol spokesman spoke, a group of protesters from the hard-hit nearby beach town of Ancon gathered with signs and chanted demands outside the plant. "Repsol accept responsibility", and "Repsol murderer, the beaches of Ancon are in mourning" were among their signs. "The reason for the protest is that (the oil spill) has left us without work because of this contamination of the sea in Ancon," Miguel Basurto, a 53-year-old motorcycle taxi driver, told AFP. "We feel outraged because we have no support from the Repsol company. They clean their hands of it, and go away and leave us with all this pollution that affects children and the elderly," said merchant Ana Garrido, 40. It was the first time since the spill that Repsol let journalists visit its La Pampilla refinery -- to see how 90 specialists there are managing the 3,000 people who are cleaning up the spill.

Pipeline ruptures after rockslide, indigenous people face another environmental disaster, Ecuador - A pipeline running through Ecuador's Amazon rainforest ruptured on Friday, January 28, 2022, spraying crude oil into the rainforest.The event took place on the banks of the Coca River, threatening the livelihoods of 27 000 Indigenous Kichwa people still suffering impacts of the massive oil spill in April 2020.According to NBC, more than 60 000 people depend on water from the river.¹Videos posted by the Confederation of Indigenous Nationalities of Ecuador (CONAIE) and Amazon Frontlines (AF) showed oil spraying out of the pipeline into the rainforest, eventually reaching the Coca River.Authorities have not yet released info on the magnitude of the spill, but estimates are that it was big, AF said."The river is contaminated. Look," said a campaigner in a video posted by AF, showing oil flowing into the Coca River. "Thousands of liters are being spilled into the river. Thousands and thousands."²"This is the exact reason why we oppose oil extraction," said Andres Tapia of the Confederation of Indigenous Nationalities of the Ecuadorian Amazon, the parent organization of CONAIE."Spills have become a part of our daily life, and we live with the contamination for decades. The oil industry has only brought us death and destruction… We are calling on the government to halt oil expansion plans and properly clean up this spill and all the others that continue to contaminate our territories and violate our rights."OCP Ecuador, the company that operates the pipeline, said the rupture was caused by rockfall, adding they have stopped pumping and begun cleanup.The company further said they have contained the spill so it cannot contaminate any bodies of water.However, footage released by AFrontlines showed oil entering the river.

Oil spill sprays crude into Ecuador’s Amazon rainforest - The private company that runs an oil pipeline in Ecuador’s Amazon rainforest stopped pumping oil Saturday after a rupture in the pipeline, according to a statement from the company. Footage obtained and posted on Twitter by the Confederation of Indigenous Nationalities of Ecuador (CONAIE), an advocacy group, shows oil spraying out of the pipeline. The rupture happened Friday, and was caused by a rock fall, said OCP Ecuador, the company that operates the pipeline. OCP Ecuador said it had “immediately initiated clean up, environmental remediation as well as repair of the pipeline in the Piedra Fina sector and implemented all the necessary actions to avoid, reduce, mitigate and repair any impact related to the OCP pipeline rupture caused by the rockslide on January 28, 2022.” The company said it had contained spilled oil so “it cannot contaminate any bodies of water” and had stopped pumping crude until “conditions are right.” Remedial action includes containing the spilled crude so it cannot contaminate any bodies of water. “This is the exact reason why we oppose oil extraction,” said Andres Tapia of the Confederation of Indigenous Nationalities of the Ecuadorian Amazon, the parent organization of CONAIE. “Spills have become a part of our daily life, and we live with the contamination for decades. The oil industry has only brought us death and destruction. … We are calling on the government to halt oil expansion plans and properly clean up this spill and all the others that continue to contaminate our territories and violate our rights.”

Ecuador Oil Spill, Ecuador Oil Spill Damage: 6,300 Barrels Oil Spill, South America's 2nd In 14 Days, Damages Reserve - An oil spill caused by a ruptured pipeline in Ecuador's Amazon region leaked almost 6,300 barrels into an environmental reserve, according to information provided Wednesday by the company that owns the conduit. The firm OCP said it had "collected and reinjected 5,300 barrels of crude into the system" since the accident on Friday when heavy rains caused a boulder to fall on the pipeline in a mountainous region. OCP said the recovered oil amounted to 84 percent of the total that leaked, which would mean around 6,300 barrels. The oil was collected in large basins deployed as an emergency measure when there is a leak. OCP president Jorge Vugdelija said in a statement that the company was using people and machines to "collect traces of crude found in the river." He added: "We will not spare resources to comply with the cleaning, remediation and compensation." Around 21,000 square meters of the Cayambe-Coca nature reserve has been affected by the leak. Crude flowed into the Coca river, one of the largest in Ecuador's part of the Amazon and which serves as a water source for many riverbank communities, including indigenous ones. "We demand to know... what will be the process of delivering water and food to the communities. It's clear that the river water cannot be used or drunk," Cayambe-Coca is 4,000 square kilometers (1,544 square miles) of mountains and rainforest in the Amazon basin sitting between 600 and 5,790 meters (1,970 to 19,000 feet) above sea level. Recent heavy rains caused landslides and rock falls in the area of Piedra Fina, where the pipeline lies. The 485-kilometer pipeline straddles four provinces all the way to the Pacific coast in the west, transporting 160,000 barrels of oil a day from wells in the jungle. Oil started spilling out immediately after the pipe was hit by a massive rock. "At the moment the tube exploded, the oil shot out, like a pressure pump," said site worker Cesar Benalcazar, 24. "We tried to stop the crude from reaching the river but the slope made it descend like a waterfall." In 2020 a mudslide damaged pipelines in the same area, resulting in 15,000 barrels of oil polluting three Amazon basin rivers, affecting several communities. Crude petroleum is Ecuador's biggest export product. Between January and November 2021, the country extracted 494,000 barrels per day.

Authorities rush to contain oil spill moving toward eastern Thailand resort island -— Authorities are rushing to prevent an oil spill in eastern Thailand from damaging fragile corals, after officials said on January 30 that the leak that began last week was drifting towards more coastal areas. Minister of Natural Resources and the Environment Varawut Silpa-archa said it was crucial to try to prevent the main mass of oil from reaching the shore at Ao Prao, a small bay on Koh Samet, which is a popular resort island. "If the oil reached inside this area it could impact the beach and cause heavy damage to the shallow water corals," Varawut said. The oil began leaking from a pipeline owned by Star Petroleum Refining Public Company Limited (SPRC) late on Tuesday. Before it was brought under control, an estimated 50,000 liters (13,209 gallons) of oil escaped into the ocean 20 km (12 miles) from the coastline of eastern Thailand. Mae Ramphueng Beach in Rayong province was declared a disaster area after some oil came ashore there late on Friday. The latest satellite image from the government's Geo-Informatics and Space Technology Development Agency (GISTDA) showed the oil spill has spread to cover 67 sq km (25.87 sq miles) area of the sea. Most of the oil had formed a thin film rather than a thick oil slick, navy spokesman Vice Admiral Pokkrong Monthatphalin told reporters, citing aerial photographs.

Thailand beach declared disaster area after massive oil spill, aerial images show extent of damage, A beach on Thailand's east coast has been declared a disaster area by the authorities after an underwater oil pipe leak. In the aftermath, oil has been washing up on a beach, blackening the sand. It is causing damage to marine life. Authorities have revealed that the leak from the pipeline, owned by Star Petroleum Refining Public Company Limited (SPRC), started late on Tuesday (January 25). SPRC said it was trying to minimise oil reaching the shoreline using booms. It was brought under control a day later after spilling an estimated 50,000 litres of oil into the ocean 20 km from the country's industrialised eastern seaboard. Thailand's navy and pollution experts have begun cleaning up a spill in the Gulf of Thailand. Photos and videos from the region showed crews in yellow plastic protective suits at Mae Ram Phueng Beach on Saturday afternoon cleaning up the oil slick. Mae Ram Phueng Beach is about two and a half hours from Bangkok, a popular tourist place as local hospitality businesses said that the oil washing up on the beach could be the "nail in the coffin" for pandemic-hit hotels and restaurants.

Efforts to remove oil sludge off Rayong shoreline - Oil washing up on Mae Ramphueng beach in Rayong could be the “nail in the coffin” for hotels and restaurants already brought low by the pandemic, local hospitality business operators said on Saturday. The navy and pollution experts are scrambling to clean up the mess created by the spill that took place in the Gulf of Thailand on Tuesday after at least 60 tonnes of crude leaked from a pipeline about 20 kilometres off the coast. Crews in yellow plastic protective suits fanned out along the beach on Saturday afternoon to start cleaning up the oil slick that began washing ashore late Friday night. Star Petroleum Refining Plc (SPRC), the operator of the undersea pipeline that leaked, said it was trying to minimise the amount of oil reaching the shoreline by using booms. An aerial surveillance aircraft is monitoring the slick on the sea. A 47-square-kilometre area was affected before the slick drifted to the shoreline late Friday, a satellite image from the government’s Geo-Informatics and Space Technology Development Agency showed. Marine scientist Thon Thamrongnawasawat said the oil slick was expected to continue to wash up on shore over the coming days due to stronger winds. People should “definitely avoid” swimming in affected areas, Mr Thon said in a Facebook post. For struggling resorts and tourism-dependent businesses at Mae Ramphueng beach and the surrounding area, the pollution and lack of swimmers could spell disaster for livelihoods. “There have been fewer customers because of Covid-19 and the lethargic economy and now the oil spill is like a nail in the coffin,” said Korn Thongpiijit, 45, who manages the Barnsabhaisabai Resort, which is situated right next to where authorities have set up a clean-up operation. A dozen ships are spraying dispersant chemicals and so far more than 80,000 litres have been used over the affected area, the Royal Thai Navy said on Saturday. SPRC said divers had found a failure in a flexible hose that formed part of the undersea equipment around a single-point mooring — a floating buoy used to offload oil from tankers. A pipeline leak in the same area in 2013 led to a major slick that coated a beach on neabry Koh Samet.

Industry Ministry will set up panel to investigate Rayong oil spill - An underwater pipeline owned by Star Petroleum Refining (SPRC) sprung a leak last Tuesday, releasing approximately 160,000 litres of oil into the sea before the leak could be plugged. On Saturday, Rayong’s Mae Ram Phueng Beach was declared a disaster zone after oil from the spill washed ashore. Satellite images showed the slick had spread across 47 square kilometres of sea. “The objective of the committee is to uncover the exact amount of oil that has seeped into the sea, the cause of the incident and to find solutions that will sustainably mitigate the environmental impact,” Suriya said. “The panel will consist of experts in related fields, representatives from local communities and relevant government agencies including the Marine Department, the Department of Marine and Coastal Resources, the Industrial Estate Authority of Thailand, the Pollution Control Department and the Public Health Ministry.” Headed by the Industry Ministry, the panel will also supervise the “repair” of industrial estate facilities around Map Ta Phut port that were affected, and issue regulations to ensure the safety of workers. Suriya added that the ministry had tasked the Industrial Estate Authority of Thailand, which is responsible for the Map Ta Phut Industrial Estate, to coordinate with SPRC in providing appropriate compensation to affected communities and businesses in the industrial estate, which are mostly petroleum refiners. Earlier this week SRPC announced that it would establish a centre in association with Rayong authorities to accept complaints from people affected by the incident, and has promised to provide suitable compensation in both short and long terms. On Tuesday the Puenchumchon (Friends of Communities) Association announced it would train schoolchildren in Rayong to prepare for possible leakage of hazardous chemicals from the industrial estate. “The training will cover instructions on using safety equipment and an evacuation drill,” association manager Monchai Raksujjarit said.

Impact of Rayong oil spill will take more than a decade to overcome, say locals --Local fishermen are worried that the oil spill in Rayong will have a far-reaching impact on the marine ecosystem, especially since the area is still struggling from the aftermath of the 2013 disaster. Weerasak Kongnarong, president of the Rayong fishermen association, said earlier this week that the wind and waves are pushing the slick toward Koh Samet, and it will take at least 20 years for the damage to be mitigated. He said just using dispersant chemicals is not enough. He added that the association has also rejected the compensation offered because it’s very small and will not pay for the losses that will be incurred over the next decade or two. Siwatt Pongpiachan, director of NIDA Centre for Research & Development of Disaster Prevention & Management, said soil samples taken from Koh Samet two years after the 2013 spill showed the presence of carcinogen polycyclic aromatic hydrocarbon. Judging by this, he said, the spill on January 25 will affect the marine ecosystem for at least another 10 years. Phenchom Saetang, director of the Restoration Ecosystem Foundation, said apart from the damage caused in 2013, the huge amount of chemicals used to disperse the oil also caused insurmountable damage to marine life. She said residents should get together and demand that the government set up a panel that can investigate and come up with fair compensation. Sarinee Achavanuntakul, a co-founder of sustainable business accelerator Sal Forest, said the facts of the incident are not very clear. She said Star Petroleum Refining Company Limited (SPRC) and Chevron should release all the information and provide updates on the clean-up progress. Tara Buakamsri, country director of Greenpeace Southeast Asia, said citizen science is lacking in Thailand as people think the issue is not related to them. Meanwhile, Thanakrit Vorathanatchakul, a prosecutor with the Attorney General's Office, said in a Facebook post that the government can sue for damage, while fishermen, businesses and locals should come together and demand compensation. He added that locals can also take the company to court and suggested they do it as a group to keep the court fees low.

Explosion In Oil Storage Unit Near City Kills 3 Kids, Man - Times of India - Three kids were among four persons killed after a turpentine oil factory and storage unit inside a makeshift building on farmland exploded in Jamwaramgarh near Jaipur on Sunday morning.According to additional SP Dharmendra Kumar Yadav, the reports prima facie suggest that the building was used for storing turpentine oil. Jamwaramgarh SHO Jogendra Rathore have named the victims as follows, Ramesh alias Kalu Ram (25), Divya (2), Garima (3), and Ankush (5).Police said that three others were injured in the fire and were undergoing treatment in the hospital.‘Building was used to pack oil into small canisters’According to Jamwaramgarh deputy SP Shiv Kumar Bhardwaj, the incident took place at Dhoola Raoji village.“It appears that the building was used to pack oil from large drums into small packets,” he said. The building was made up of one room with a tin shed on farmland.Police said it belonged to one Shankar Lal Saini and the victims and injured were members of his family and relatives. All victims are residents of the same Dhoola Raoji village. Police described the building as a “factory”, but suspect that it was run without legal permit and safety norms. Shankar Lal Saini’s house is located nearby the building and kids had gathered to play inside it before the explosion took place, suspected to be due to some short circuit. Mahendra Pal Meena, a local resident and leader in Jamwaramgarh, said that the incident took place early in the morning when the kids were present inside the building.“It was a very tragic accident. We expect the victims' families will be given some compensation,” he said.

TasPorts managing spill after tug collision - TasPorts teams have pulled the final tug, Wilga, out of the contamination area after a collision at the Port of Devonport between commercial vessel Goliath and TasPorts tugs Campbell Cove and York Cove. The collision on Friday 28 January caused both TasPorts tugs, which were berthed and stationary at the time of the incident, to take on water, and they became submerged alongside the wharf at Berth 3 West. TasPorts Chief Operating Officer, Stephen Casey, said significant planning was integral in the successful extraction of the third tug from the containment area. “At the time of the incident, a third tug, Wilga, was alongside, narrowly avoiding the collision,” Mr Casey said. “In response to the incident, TasPorts teams mobilised quickly and deployed oil spill response equipment within 45 minutes of the collision, which captured the third vessel in the containment area.” Aligned with the Tasmanian Marine Oil and Chemical Spill Contingency Plan and the identified risk of oil spill from the submerged tugs, the Environmental Protection Agency (EPA) took control of the site as the leading agency, with TasPorts continuing to work alongside. “A plan was developed under the guidance and direction of the EPA to enable the tug’s extraction, whilst minimising impact to the port and potential oil dispersal,” Mr Casey said. “The plan saw Wilga towed from the containment area as a ‘dead ship’ by tug Watagan from the Port of Burnie, minimising disruption to contaminated water. “Additional controls were also put in place for the towage operation by TasPorts Harbour Master to ensure the ongoing integrity of the oil spill containment.

Again, Nigeria Loses 6.5m Barrels of Oil to Force Majeure, Sabotage in December - There appears to be no end in sight to the financial and resource haemorrhage in Nigeria’s oil and gas industry, with the country once more losing as much as 6.596 million barrels of oil in its December 2021 production. At an average of $75 per barrel that crude oil sold last month and an official exchange rate of N415/$1, Nigeria failed to take advantage of high international oil prices for the month, losing a whopping $487.5 million (about N202.3 billion). Latest figures from the Nigerian National Petroleum Company Limited (NNPC) indicated that the losses were due to a combination of factors, including force majeure declared by a Joint Venture (JV) partner. Other reasons listed by the national oil company included community issues, maintenance work, sabotage, and technical matters, like leakages, pressure build-up, and faulty valves. But in the month that the company experienced the N202 billion loss, it remitted a meagre N20 billion of its projected N209 billion to the Federation Account. The amount was, however, about 100 per cent higher than the N10.5 billion it contributed in November 2021.NNPC’s presentation to the Federation Account Allocation Committee (FAAC) indicated that Bonny took the greatest hit, losing 2.712 million barrels in the month due to the force majeure declared on the Nembe Creek Trunk Line (NCTL). The Urha terminal followed with 1.468 million barrels loss, which curtailed production within the period and hobbled exports. The loss from that particular terminal exceeded the country’s production for the entire month. Odudu terminal also suffered the same fate due to decrease in production as a result of maintenance work on the Odudu and Ima terminal.Furthermore, Forcados shed 456,575 barrels of oil as a result of what NNPC described as community issues, which delayed reinstatement of the facility. Besides, Yoho dropped 420,000 barrels during the month under review, owing to a faulty valve; Ajapa lost 30,000 barrels due to shut down, while Aje terminal curtailed production within the period to the tune of 62,000 barrels. Similarly, Brass suffered sabotage around Tebidada and Ogbaibiri flow stations as well as valve issues, pressure build-up, high sand production, leak repairs, resulting in a total loss of roughly 198,200 barrels. Last week, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) lamented that with the Organisation of Petroleum Exporting Countries (OPEC) production quota of 1.683 million bpd in January and 1.701 million bpd in February, Nigeria was only able to pump 1.396 million bpd currently. In all, it stated that this was leading to a loss of at least 115,926 million bpd on a daily basis, put at roughly $300 million monthly.“We are losing about 115, 926 barrels per day, so that literally translates to roughly $300 million and that’s a huge loss to a nation that actually requires these funds,”

Oil production vessel explodes off Nigerian coast — An oil production ship exploded off the coast of Nigeria in what may prove to be the nation’s second major environmental setback in three months. The Trinity Spirit, able to store about 2 million barrels of oil, blew up early Wednesday, Shebah Exploration & Production Co., which has the vessel on lease, said in a statement. The ship can process up to 22,000 barrels a day, according to the company’s website. While no fatalities have been confirmed, 10 crew were on board the vessel when it exploded, according to Shebah. The company said it is investigating the cause. The incident puts increasing focus on the oil industry’s environmental legacy in Nigeria. In November, a well operated by independent producer Aiteo Eastern E&P Co. blew, spewing oil and gas into the air and surrounding river for five weeks before it was capped. As international companies such as Shell Plc sell their remaining onshore and shallow water assets in the country, activists and local communities fear they will retreat without addressing widespread damage allegedly caused by decades of pumping oil. It’s unclear how much crude was being held on the Trinity Spirit. Data published by Nigeria’s state-owned energy company show no production from Shebah’s permit in 2020 or 2021, while the country’s oil regulator announced in mid-2019 it was revoking the license. The vessel was still on fire Thursday evening, Idris Musa, director general of the National Oil Spill Detection and Response Agency, said. “From the environment angle, we are putting in efforts to prevent damage beyond the current burning of the contents” of the ship, he said.

Fire extinguished from Nigerian oil tanker explosion amid ‘full-scale’ probe into disaster -- A massive blaze has been extinguished following the explosion of an oil production vessel off the coast of Nigeria.The vessel, which has the capacity for two million barrels of oil, burst into flames on Wednesday and belched thick, black smoke before it sank. The fate of the ten crew onboard remains unclear.The vessel, which had been operating in the oil-rich Niger Delta region, is owned by Shebah Exploration & Production Company Ltd (SEPCOL). SEPCOL is “prioritizing investigations with respect to their safety and security” and has notified all relevant authorities about the development, Ikemefuna Okafor, CEO of the oil company, told AP.The vessel has the ability to process up to 22,000 barrels of oil per day, according to Fleetmon. Nigerian government regulators have launched a “full-scale” probe into the explosion to determine how much oil the vessel was carrying, and who it belongs to.An industry source told Reuters that the vessel had about 50,000 barrels in storage.

New Fossil Fuel Project Would Turn Uganda Into Oil-Producing Country - A new project from French fossil fuel company TotalEnergies and China National Offshore Oil Corporation (CNOOC) would turn Uganda into an oil-producing country for the first time. Total announced Tuesday that the companies would spend more than $10 billion to develop oil fields in Uganda and build a pipeline network both within the landlocked country and through Tanzania, which has a coastline.“In the name of the joint venture partners and… TotalEnergies, I declare the final investment decision for the Lake Albert development project,” TotalEnergies Chief Executive Patrick Pouyanne said when he announced the deal, as Reuters reported.The project would exploit oil reserves underneath Lake Albert, which sits between Uganda and the Democratic Republic of Congo, AllAfrica reported. The reserves were first discovered in 2006, but have yet to be accessed because of a lack of infrastructure, as well as disagreements between the Ugandan government and oil companies. “This milestone puts us on the path to first oil in 2025,” Uganda’s Minister of Energy and Mineral Development Ruth Nankabirwa Ssentamu said in a speech now that the deal has finally been signed, as AllAfrica reported. Accessing the oil would mean building a 1,443-kilometer (approximately 897 mile) heated pipeline from Hoima, Uganda to the Tanzanian port of Tanga on the Indian Ocean, according to 350.org. The so-called East African Crude Oil Pipeline (EACOP) would be the largest heated crude-oil pipeline in the world and is vehemently opposed by climate activists. “The future of East Africa relies on building sustainable, diversified and inclusive economies – not by letting huge multinational corporations like Total extract resources and keep the profit,” 350Africa.org regional director Landry Ninteretse said in a statement reported by 350.org. “The impacts of building the East Africa Oil Pipeline will be devastating for our communities, for wildlife and for the planet.”

TotalEnergies and Chevron to Leave Critical Gas Field in Myanmar - TotalEnergies, the French oil giant, and Chevron said Friday that they would begin taking steps to withdraw from an offshore natural gas field in Myanmar that is a critical source of energy for both the host country and neighboring Thailand. TotalEnergies said it was responding to a deterioration of the human rights situation and the “rule of law” in Myanmar since the military coup in February. The situation had reached a point, the company said, where it could no longer “make a sufficiently positive contribution in the country.” Since the coup, the military regime has waged a brutal crackdown on protests. Soldiers and the police have killed at least 1,488 civilians, according to the Assistance Association for Political Prisoners. Chevron and TotalEnergies argued in the past that their presence was beneficial to the people of Myanmar and that shutting off the flow of gas would increase hardship. Chevron says the gas from the Yadana field generates electric power for roughly half the population of Yangon, Myanmar’s largest city, as well as supplying Thailand. “Effectively turning off the power to half of Yangon’s homes, schools and hospitals — in the middle of a state of emergency and a pandemic — risks creating even more hardship,” Chevron said in a briefing note published in May on the company’s website. Last year, Chevron waged a vigorous lobbying campaign in Washington to prevent the White House from imposing sanctions in Myanmar that could disrupt the gas operations at the Yadana field and worsen the crisis for people who rely on the power. The companies, though, have evidently decided that they have no choice but to yield to pressure from human rights groups and others to prepare to abandon a project that provides financial sustenance for Myanmar’s military.

China’s 2022 crude imports seen rebounding on new refineries, inventory refill - China’s crude oil imports could rebound by 6-7% this year, reversing 2021’s rare decline as buyers step up purchases for new refining units and to replenish low inventories, analysts and oil company officials said. Robust demand from China, which accounts for a tenth of the global crude trade, would help underpin global oil prices, keeping supplies tight amid forecasts for a jump in crude prices to $100 a barrel or more. Demand recovery, however, is not expected until the second half of the year as China continues to combat COVID-19 outbreaks and limit production by smaller refiners. For 2022, crude oil imports into China look set to grow by 600,000-700,000 barrels per day (bpd), offsetting last year’s 590,000 bpd fall to match or beat 2020’s record volume of 10.85 million bpd, analysts at FGE, Rystad Energy and Energy Aspects told Reuters. Brent and West Texas Intermediate futures LCOc1, CLc1 are already at 7-year highs near $90 a barrel as investors look beyond the demand hit from the Omicron variant. “We expect China’s refinery runs to grow by 500,000 bpd, mainly driven by new refinery capacity coming online in 2022 and the recovery in transport and aviation fuels picking up the pace in the second half of the year,” Imports are likely to make a slow start initially as Beijing’s zero-tolerance virus control measures keep a lid on fuel demand, while reduced import quotas and narrowing refining margins will limit production by independent refiners. Refinitiv data showed January arrivals totalled 41.13 million tonnes (9.69 million bpd), below 44.6 million tonnes in January 2021 and 46.1 million tonnes two years ago. A possible release of state petroleum reserves (SPR) in coming weeks will also dampen national oil companies’ purchases, analysts said.

EIA forecasts OPEC production will grow in 2022 despite recent production outages in Libya - In our January Short-Term Energy Outlook (STEO), we forecast that OPEC petroleum production will increase by nearly 2.7 million barrels per day (b/d) in 2022, the largest year-over-year increase in OPEC production since 2004. This increase in our forecast of crude oil production is largely based on our interpretation of the January 2022 OPEC+ meeting, when participants reaffirmed their decision to continue to increase output by 0.4 million b/d each month until all of the production cuts are reversed. We expect that recent production disruptions in Libya will be more than offset by production increases from other OPEC members. Libya’s crude oil production averaged nearly 1.2 million b/d during 2021. In late December 2021, armed militants shut in an estimated 370,000 b/d from the four key oil fields in the southwestern part of the country. We estimate that 0.4 million b/d of crude oil production went offline in Libya in late December 2021. This unplanned outage contributed to the increase in the Brent crude oil spot price to $90 per barrel (b), as of January 19, 2022, which was $16/b more than the December average. This January daily high was the first time the Brent crude oil price had reached $90/b since October 2014. Heightened political risk following the delay in Libya’s presidential and parliamentary elections (which were scheduled for December 24, 2021) continues to create uncertainty. In addition, ongoing maintenance on the country’s aging infrastructure also continues to limit oil production in Libya. As a result of this disruption in Libya, we estimate that unplanned outages in OPEC countries increased to 2.2 million b/d in December 2021. Our forecast assumes that the sanctions that are constraining petroleum exports from Iran and Venezuela will remain in place through the end of 2023. Despite the recent increase in unplanned outages, we estimate that OPEC members still have more surplus production capacity than they have had on average in the past. OPEC’s surplus crude oil production capacity increased to nearly 9 million b/d in mid-2020 as the onset of the COVID-19 pandemic greatly reduced demand, causing producers to lower output. OPEC’s surplus capacity has fallen since then and most recently averaged 4.6 million b/d in December 2021. We forecast OPEC crude oil production will increase by 2.5 million b/d to an average of 28.8 million b/d in 2022. Source: EIA

OPEC+ Fails To Reach Production Targets In January -OPEC has again failed to meet its own production targets again in January as the group lifted production only 210,000 additional barrels per day for the month. Looking at this through a monthly lens, the group increased production by just 210,000 bpd instead of the 400,000 bpd increased production that the alliance agreed to—creating a January shortfall of 190,000 barrels per day. But the real shortfall is much larger. Looking back at the base amounts that OPEC is working with, and factoring in each month’s planned increased production, January production cuts from OPEC show a much larger shortfall. OPEC’s actual January production cuts still amounted to 2.803 million barrels per day short of the base levels when OPEC agreed to the cuts. This compares to the pledged cut for January of 2.129 million bpd. This equates to an extra 674,000 bpd in cuts for January than what OPEC has agreed to. In terms of actual production, OPEC produced 27.8 million bpd in December, lifting this to 28.01 million bpd in January. Noteworthy increases came from Saudi Arabia (+100,000 bpd), Nigeria (+50,000 bpd), and the UAE and Kuwait (+40,000 bpd each). These production gains were partially offset by decreased output by Iraq (-30,000 bpd) and Libya (-40,000 bpd). If we start looking at the beginning of the cuts, there are only two OPEC members that are producing above their January target, and that’s Algeria and Gabon. The largest under producers, in terms of percentages—or rather those missing their ramp-up targets more than anyone else—include Angola, Congo, Equatorial Guinea, and Nigeria. Of all the OPEC members, it is Saudi Arabia, however, that has the most in terms of numbers of barrels to add back into the market as part of the future production ramp up. According to Reuters figures, Saudi Arabia still has 878,000 bpd to add back into the market.

To Ease Supply Pressures, OPEC-Plus Targets Further Crude Production Increase -Citing robust demand and fading pandemic worries, an alliance of major oil producing countries agreed on Wednesday to extend production increases into March. Policymakers from the Organization of the Petroleum Exporting Countries (OPEC), headed by Saudi Arabia, and a Russia-led group of allies known as OPEC-plus, said they aim to boost output by 400,000 b/d next month. The effort would continue a targeted rate of monthly supply increases the cartel began in August to gradually unwind production cuts of nearly 10 million b/d made in April 2020 amid the initial demand destruction imposed by the coronavirus. Analysts noted OPEC’s and others’ forecasts for robust demand through 2022 as the Omicron variant of the virus, while highly contagious, appears less lethal than earlier strains. Most major economies, including the United States, have resisted lockdowns amid Omicron’s spread and instead focused on vaccine campaigns, allowing travel to further rebound and demand for fuel to climb. Prices reflect the demand backdrop. Brent crude, the international benchmark, traded above $90/bbl at its height on Wednesday, while U.S. West Texas Intermediate oil approached $89 early in the day – both near multi-year highs. Rystad Energy analyst Bjørnar Tonhaugen said American producers and others outside of OPEC-plus also are likely to raise output this year to meet demand and capitalize on favorable prices. “Prices are far-far above breakeven…from anywhere from the U.S. shale patch to offshore, not to mention onshore fields in the Middle East,” Tonhaugen said. “From an operator’s economical perspective, investments and supply should see a positive jolt some months down the line this year and into the next.” All of that noted, U.S. producers are under relentless pressure from Wall Street to be cautious about substantial oil output increases. Investors want to see more investment in renewable fuels. Additionally, Tonhaugen said, several members of OPEC-plus are struggling to keep pace with the cartel’s targeted increases, including war-torn Libya and both Nigeria and Angola, which have struggled with deteriorating infrastructure. There also “is anxiety about damage to production capacity from Saudi Arabia to Kuwait and Russia, from too low investments during the pandemic and before,” Tonhaugen said. “Looking back, we find that OPEC-plus has failed to live up to its own pledge of increasing production according to plan,” trailing its target last month and over several months in 2021.OPEC researchers in January predicted global demand would rise by 4.15 million b/d and that consumption would exceed 100 million b/d in the third quarter, returning demand to pre-pandemic levels.

Oil rises, hovers near 7-year highs on supply fears, political risks -- Oil rose 1% on Monday, hovering near 7-year highs hit in the previous session, amid concerns over tight supply as well as geopolitical tensions in Eastern Europe and the Middle East. Brent crude rose 92 cents, or 1.0%, to $90.95 a barrel at 0051 GMT, after adding 69 cents on Friday. The front-month contract for March delivery expires later in the day. The most-active Brent contract, for April delivery, was trading at $89.69, up $1.17 or 1.3%. U.S. West Texas Intermediate crude rose 99 cents, or 1.1%, to $87.81 a barrel, having gained 21 cents on Friday. Both benchmarks recorded their highest since October 2014 on Friday, $91.70 and $88.84, respectively, and a sixth straight weekly gain. "Underlying anxiety about global supply shortages, coupled with ongoing geopolitical risks, have caused the market to start the week on a strong note," said Toshitaka Tazawa, an analyst at Fujitomi Securities Co Ltd. r "With an expectation that OPEC+ will keep the existing policy of gradual increase of production, oil prices will likely stay on a bullish sentiment this week," he said, predicting Brent to remain above $90 a barrel and WTI to head toward $90. Major producers in the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, collectively known as OPEC+, have raised their output target each month since August by 400,000 barrels per day (bpd) as they unwind record production cuts made in 2020. But they have failed to meet their production targets as some members have struggled with capacity constraints.

More Gains For Crude As Demand Skyrockets, $100 Oil Forecast Again - The latest sign of tightening crude inventories – oil held on tankers falling by over 20 percent last week – was one of several factors that caused prices on Monday to once again climb, with Brent settling above $91 per barrel and posting a 17 percent monthly gain. Additionally, a damaged oil pipeline in Equador caused further supply worries, and snowstorms in eastern U.S. boosted demand for fuels. West Texas Intermediate rose $1.33 to settle at $88.15 per barrel, while Brent for March settlement gained $1.18 to $91.21 per barrel (the more active April contract rose 74 cents to $89.26). It was also reported on Monday that profits from converting oil to gasoline in the U.S. are at the highest level for this time of the year since 2013, while in Europe oil's premium to crude is at its highest on a seasonal basis in at least three years. Paul Wallace, analyst at Bloomberg News, said that while geopolitical tensions and other factors play significant roles in oil's bullish performance, "The issue of dwindling spare capacity is really what's at play here, it's something that's really come to the front of traders' minds." He added that if tensions between Russia and Ukraine were to ease it would certainly cause prices to abate, but whether it would be by $5 or $10 per barrel he could not say. Monday also saw the increasingly familiar spectacle of various analysts predicting $100 oil in the near future, one being Stephen Schork, principal at The Schork Group: he pegged the chances at 30 percent. But the predictions were not altogether upbeat: Mohammed Ali Yasin, chief strategy officer from Al Dhabi Capital, reminded Bloomberg television that oil in the three digits could slow global recovery. As for the meeting this Wednesday of the Organization of the Petroleum Exporting Countries and allies led by Russia, it is widely expected that they will maintain their policy of raising their output by 400,000 barrels per day per month, and this caused Louise Dickson, senior oil markets analyst at Rystad Energy, to remark that the "month-to-month supply increases of 400,000 bpd are either too immaterial for the market to appreciate and more importantly, not being completely fulfilled by the group. "The only short-term solution for balancing the supply-short oil market will therefore need to come from OPEC+, and steered by Saudi Arabia, the producer with the largest spare capacity."

Oil Records Strongest January in Over Thirty Years - Robust and persistent demand, coupled with stagnant supply, has crude off to a raging start in 2022. Oil had its biggest January gain in at least 30 years as robust demand outpaced fresh supply. The global benchmark settled above $91 a barrel, posting a 17% gain this month. The combination of booming demand, scratchy supply and dwindling stockpiles has helped crude soar this month, with top banks and oil companies saying prices may soon pass $100 a barrel. Crude’s rally is really “a supply story,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management. “Crude is flying in the face of a strong U.S. dollar and a weak global stock market. It comes down to its own fundamentals more than anything else.” Traders were greeted Monday with a familiar set of drivers, from the weather to stockpiles. Low temperatures in the U.S. have been boosting demand for fuels, as Boston reported a daily snow record over the weekend and New York’s Central Park received more than 8 inches (20 centimeters.) An oil pipeline in Ecuador was damaged by a rock slide, potentially endangering supply. Meanwhile, oil held on tankers fell by more than 20% last week, the latest sign of ebbing inventories. While the advance has gained extra support as Russia amasses troops near Ukraine, it also has been compounded by the inability of the Organization of Petroleum Exporting Countries and its allies to meet planned supply output increases. The OPEC+ alliance gathers Wednesday to assess the market. As economies continue to recover from the pandemic, oil product markets are roaring. Refiners across the globe are making robust profits from producing gasoline, with the demand outlook signaling continuing strength. WTI for March delivery rose $1.33 to settle at $88.15 a barrel in New York. Brent for March settlement gained $1.18 to $91.21 a barrel. The more active April contract rose 74 cents to $89.26. Global oil markets are in backwardation, a bullish pattern in which near-term contracts command a premium to those further out.

Oil Futures Soften After Expiries - In early trading on the first day of February, oil futures nearest delivery on the New York Mercantile Exchange and Brent crude traded on the Intercontinental Exchange posted mild losses as investors monitor developments leading up to Wednesday's OPEC+ policy meeting for additional clues on the alliance's plans to release more supplies into a tightening oil market, while the upturn in manufacturing activity across European Union this month lent limited support. Eurozone's economic data released overnight showed manufacturing activity across the 19-nation bloc regained upward momentum at the beginning of 2022, led by gains in production, new orders, and employment. The improvement came on the back of tentative signs that supply chain issues are starting to abate, while inflation pressures eased slightly. The headline number for Eurozone's final manufacturing Purchaser Manager's Index improved to 58.7 this month -- the highest since August 2021, and 0.7% higher compared with December reading. Data split by Eurozone countries revealed Austria had the strongest-growing manufacturing sector in January, while faster expansions were also seen in the Netherlands, Germany and Ireland. Germany, the European Union's largest economy, recorded an improvement of 4.4 points from an 18-month low 49.9, signaling solid growth in business activity across the private sector after a slowdown at the end of 2021. Also on Tuesday, oil traders are monitoring the developments around OPEC+ monthly meeting, with expectations for the 23-nation producer alliance to raise joint supplies by 400,000 bpd next month. In December, OPEC+ added just 253,000 bpd to its combined production compared with an agreed to quota for a 400,000-barrel-per-day (bpd) increase, according to data from the International Energy Agency. The document from OPEC+ technical panel seen by Reuters indicates that total production by OPEC+ countries was 824,000 bpd lower than the required production in December 2021, with overall compliance for the group climbing to 122%. OPEC's persistent underproduction fuels speculation about the cartel's ability to ramp up output in coming months. IEA estimates that OPEC's spare capacity could fall by half to just 2.6 million bpd in the second half of the year. Near 7:30 a.m. ET, the front-month West Texas Intermediate futures declined $0.46 to $87.67 per barrel (bbl), with international benchmark Brent crude for April delivery falling $0.51 to $88.73 bbl. NYMEX March RBOB futures dropped 1.61 cents to $2.5383 gallon and March ULSD futures slumped 2.45 cents to near $2.6918 gallon.

Oil little changed despite talk of possible OPEC+ supply boost (Reuters) -Oil prices ended little changed on Tuesday, as geopolitical tensions and tight global supplies supported the market even as some speculated that OPEC+ might boost supplies more than expected. The Organization of the Petroleum Exporting Countries and allies, together known as OPEC+, has been expected to decide at a monthly meeting on Wednesday to keep gradually increasing production. But Goldman Sachs said there was a chance the oil market’s rally would prompt a faster ramp-up. On Friday, crude benchmarks hit their highest prices since October 2014, with Brent touching $91.70 and U.S. crude hitting $88.84. They gained about 17% in January on a supply shortage, political tensions in the Middle East and between Russia and the West over Ukraine. Still, sources said an OPEC+ technical panel meeting on Tuesday did not discuss a hike of more than the expected 40,000 barrels per day from March. OPEC undershot its promised output boost in January, a Reuters survey found, and other analysts expected the rally to persist. [OPEC/O] “The Saudis will likely avoid any major adjustments as they have proven adept in recent years at treading a fine line in manoeuvring global pricing in their preferred direction,” Brent crude settled down 10 cents, or 0.1%, at $$89.16 a barrel while U.S. West Texas Intermediate crude rose 5 cents to $88.20. “The oil market is currently unreservedly bullish,” “It is international tension, the perception of tight supply and the cold winter that are the most important factors behind the strength.” Prices were under some pressure from expectations that this week’s U.S. supply reports will show an increase in crude stockpiles. Analysts expect stocks to have risen by 1.8 million barrels. Rising differentials in the physical crude market imply concern about tight supply, Varga said. One of the North Sea crudes that underpins Brent, Ekofisk, was bid on Monday at its highest in more than a decade.

WTI extends losses as US gasoline demand slips as inventory builds - - As we detailed earlier, oil prices have had a wild ride overnight and are now trading back below levels when the API inventory data hit last night (showing a surprise crude draw and another big gasoline build). The OPEC+ meeting appeared to go without any controversy, agreeing to the 40K b/d production hike as planned, which sent oil prices spiking notably (WTI almost $90)......but that has all been reversed now with some desks claiming Iran headlines (U.S. should ease its sanctions on Iran in order to help tightly supplied markets and ease prices, Iran’s Oil Minister Javad Owji says in comments to the state-run Shana news agency) may have been a driver of the reversal. More likely is a lack of liquidity as all markets are fading at the same time. API

• Crude -1.645mm (+1.833mm exp)
• Cushing -1.031mm
• Gasoline +5.816mm
• Distillates -2.508mm

DOE

• Crude -1.05mm (+1.833mm exp)
• Cushing -1.17mm
• Gasoline +2.12mm
• Distillates -2.41mm

The official data confirmed API's - though to a lesser extent - with Crude stocks drawing down and Gasoline inventories rising for the 5th straight month... Total crude stockpiles, including commercial inventories and crude held in the Strategic Petroleum Reserve, fell by more than 2.9 million barrels in the week to Jan. 28. On top of the 1 million barrel draw in commercial crude, another 1.87 million barrels were drawn out of the SPR. Source of Graphs: Bloomberg Implied U.S. gasoline demand slipped week-on-week but rose for the first time since late December on a four-week rolling basis. Gasoline inventories continued to build, mostly in the east coast, offsetting a dip in the U.S. Gulf Coast. US crude production continues to hover at 2 month lows...

WTI Lower Despite Crude Stock Draw; Output Falls to 10-Week Low -- Oil futures nearest delivery on the New York Mercantile Exchange weakened in late-morning trade Wednesday, with the U.S. crude benchmark accelerating losses following the midmorning inventory report from the U.S. Energy Information Administration. The report showed commercial crude oil stockpiles unexpectedly fell during the final week of January, even as refiners sharply reduced run rates amid softer demand for motor gasoline while domestic production extended lower for the second consecutive week Near 11:30 a.m. EST, front-month West Texas Intermediate futures dropped $0.80 barrel (bbl) to $87.29 bbl. NYMEX March RBOB futures held a 0.40 cent gain at $2.5797 gallon, with the front-month ULSD futures turned lower to trade near $2.7362 gallon, down 0.57 cent. U.S. commercial crude oil inventories unexpectedly decreased by 1 million bbl from the previous week to 415.1 million bbl and are now about 9% below the five-year average. Analysts expected crude stockpiles would rise by 1.1 million bbl from the prior week. Oil stored at the Cushing, Oklahoma, hub, the delivery point for the WTI contract, fell 1.2 million bbl from the previous week to 30.5 million bbl, the EIA said in its weekly report. U.S. crude oil production, meanwhile, fell by 100,000 barrels per day (bpd) from the previous week to the lowest weekly rate since mid-November at 11.5 million bpd. Refiner run rate dropped 1% to 86.7% compared with analyst expectations for a 0.1% decrease. For the gasoline complex, EIA's inventory report was bearish, showing stockpiles having increased 2.1 million bbl from the previous week to 250 million bbl, more than analyst expectations for inventories to have increased by 1.7 million bbl. Demand for motor gasoline reversed lower by 279,000 bpd to 8.226 million bpd, down 539,000 bpd or 6.2% against the five-year average. Demand for middle distillates remained resilient in the final week of January, holding near 4.669 million bpd -- 515,000 bpd or 12.4% above the five-year average. Distillate stocks were drawn down for the third straight week, down 2.4 million bbl to 122.7 million bbl, and are now about 19% below the five-year average. Analysts estimated distillates inventories would fall by 1.6 million bbl from the previous week. Total products supplied over the last four-week period averaged 21.6 million bpd, up 11.8% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.2 million bpd, up 5.2% from the same period last year. Distillate fuel product supplied averaged 4.4 million bpd over the past four weeks, up 11.3% from the same period last year. Jet fuel product supplied was up 29% compared with the same four-week period last year at 1.466 million bpd.

Oil little changed after draw in U.S. stocks, eyes on OPEC+ decision - Oil prices rose on Wednesday towards last week's seven-year highs after data showing a fall in U.S. crude stocks underlined solid demand, but investors remained cautious ahead of an OPEC+ meeting due later in the day. Brent crude climbed 36 cents, or 0.4%, to $89.52 a barrel, before pulling back. The contract last traded 10 cents lower at $89.06 per barrel. U.S. West Texas Intermediate crude was up 12 cents, or 0.14%, at $88.32 a barrel, having gained 5 cents the previous day. Tight global supplies and geopolitical tensions in Eastern Europe and the Middle East have boosted oil prices by more than 15% so far this year. On Friday, crude benchmarks hit their highest prices since October 2014, with Brent touching $91.70 and U.S. crude hitting $88.84. "A drop in U.S. crude inventories provided support, though an increase of gasoline stocks partially offset bullish sentiment," said Satoru Yoshida, a commodity analyst with Rakuten Securities. "OPEC+ is likely to maintain its policy unchanged, which means a supply shortage and an upward trend in oil prices will continue," he said. U.S. crude stocks fell by 1.6 million barrels for the week ended Jan. 28, against analysts' estimate of an increase of 1.5 million barrels, according to market sources citing American Petroleum Institute figures on Tuesday. But gasoline inventories rose by 5.8 million barrels, above analysts' expectations for a 1.6 million build. The Organization of the Petroleum Exporting Countries and allies, together known as OPEC+, will likely stick to existing policies of moderate output increases on Wednesday, five sources from the producers' group said, even as it expects demand to rise to new peaks this year and as oil prices trade near their seven-year highs. But Goldman Sachs said there was a chance the oil market's rally would prompt a faster ramp-up. Sources said an OPEC+ technical panel meeting on Tuesday did not discuss a hike of more than the expected 40,000 barrels per day from March. Tensions between Russia and the West also underpinned crude prices. Russia, the world's second-largest oil producer, and the West have been at loggerheads over Ukraine, fanning fears that energy supplies to Europe could be disrupted. On Tuesday, Russian President Vladimir Putin accused the West of deliberately creating a scenario designed to lure it into war and ignoring Russia's security concerns over Ukraine.

OPEC+ agrees on another gradual oil-output hike for March— OPEC and its allies agreed to make another modest output increase in March, sticking to their plan even as the failure of several members to deliver the scheduled monthly supply hikes stokes a rally in crude prices. After a brief meeting on Wednesday, the 23-nation coalition rubber-stamped the nominal revival of 400,000 barrels a day for March, according to a statement posted on its website. The alliance has has made identical pledges in previous months, but a Bloomberg survey showed that the Organization of Petroleum Exporting Countries barely managed to increase supplies in January due to issues ranging from under-investment to militia unrest. Oil prices soared to a seven-year high above $90 a barrel last month, stirring expectations of a return to triple-digits, as supplies from OPEC+ and elsewhere failed to keep up with the vigorous recovery in demand from the pandemic. The rally is whipping up a wave of inflation that’s frustrating central banks and inflicting a cost-of-living crisis on millions. Widespread difficulties in restoring supplies increasingly place the burden on the group’s Gulf nations: Saudi Arabia, the United Arab Emirates, Iraq and Kuwait. That’s leaving traders anxious over the spare capacity available to cover any disruptions, whether deeper losses in Libya or another attack like last month’s drone strike in Abu Dhabi. “If prices continue their precipitous rise, we see a path to Saudi Arabia reprising the regulator role and ramping up output,” said Helima Croft, chief commodities strategist at RBC Capital Markets. “Of course the question is whether this would require a White House call.” West Texas Intermediate crude futures rose 1.2% to $89.25 a barrel as of 8:39 a.m. in New York. OPEC+ will meet again on March 2. OPEC’s 13 members increased production by only 50,000 barrels a day in January as slight gains across the group were wiped out by a 140,000 barrel-a-day decline in Libya, according to the Bloomberg survey. The North African nation was stricken with a blockade of its western fields by militias, forcing the shutdown of its biggest reservoir, Sharara. The 10 OPEC nations engaged in managing supplies increased by 160,000 barrels a day, about two-thirds of their targeted amount. One bright spot was Nigeria, where production rose by 100,000 barrels a day as the key Forcados export system returned to normal operating levels.

OPEC+ agrees on March output rise amid oil price rally, defying pressure from U.S., India - A group of some of the world's most powerful oil producers agreed on Wednesday to a further planned increase in output, even as crude prices trade near record levels amid geopolitical tensions. OPEC and non-OPEC partners, an influential energy alliance known as OPEC+, swiftly decided to green-light the return of 400,000 barrels per day for March. The move, widely expected by energy analysts, marks a continuation of the group's strategy to gradually reopen the taps. Led by OPEC kingpin Saudi Arabia and non-OPEC leader Russia, the energy alliance is in the process of unwinding record supply cuts of roughly 10 million barrels per day. The historic production cut was put in place in April 2020 to help the energy market recover after the coronavirus pandemic cratered demand for crude. OPEC+ has faced pressure from top consumers such as the U.S. and India to pump more to reduce prices and aid the economic recovery. The group has resisted calls for speedier increases despite higher oil prices. Russian Energy Minister Alexander Novak has previously said the broader group does not wish to boost production levels too quickly as it remains wary of potential changes to demand.

WTI Tops $89 As OPEC+ Agrees To 400k B/D Production Increase - Yet another potential event risk moment appears to have been averted as the OPEC+ JMMC is recommending the group proceeds with the planned 400,000 barrel a day increase. WTI has rallied above $89 on the news... Saudi Arabia’s energy minister Abdulaziz bin Salman again reiterated OPEC+ cautious approach when it comes to their output policy. “Prudence as I’ve been preaching about is what saved us in OPEC+,” he said just a few hours ahead of the meeting today at a conference in Riyadh. “I belong to an experience that pushed me to be trying to be a prudent person, so prudence dictates that you have a bit of think here and a bit of think there, and make sure that you see in your radar and in your screen and this screen should be 360 and don’t allow yourself the liberty of cherry picking because you don’t know who will evolve.” Notably, OPEC’s cautious pace of supply increases of course runs counter to the prevailing view in Wall Street and the trading world of a tight global market. The group’s conservatism is a reflection of its outlook for the year, which continues to project surpluses every month... The full OPEC+ meeting will almost certainly rubber stamp the decision as the bigger hike that some observers considered hasn’t materialized... and Biden's influence on the cartel is exposed as negligible once again.

Oil prices retract after weak US employment data -- Oil prices experienced a slight fall on Thursday following data showing an unexpected drop in employment in the US and on signals that Iran will return to the oil market. International benchmark Brent crude was trading at $89.12 per barrel at 0600 GMT with a 0.39% gain after closing the previous session at $89.47 a barrel. American benchmark West Texas Intermediate (WTI) traded at $87.83 per barrel at the same time for a 0.49% fall after ending the previous session at $88.26 a barrel. Companies cut 301,000 jobs in January in the US, against the expectation of the addition of 200,000 positions, payroll processing firm ADP said on Wednesday, signaling a slower economic rebound and pressuring oil prices. The Iranian Minister of Petroleum Javad Owji on Wednesday said the country was ready to return to the oil market as quickly as possible, which also drove prices down. Nonetheless, the price fall is expected to be limited, with the latest decision of the Organization of Petroleum Exporting Countries (OPEC) to hold the output increase at 400,000 barrels per day. Twenty-three members of the world's biggest oil producers, the OPEC group and allies, known as OPEC+, agreed at their meeting on Wednesday to extend the current plan of raising output by 400,000 barrels per day (bpd) through March. US commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve, decreased by 1 million barrels last week to 415.1 million barrels, US Energy Information Administration announced on Wednesday. The drop in oil inventories came against expectations of an increase of 1.525 million barrels.

WTI Tops $90 on Weather, USD Weakness Ahead of Jobs Report - Oil futures nearest delivery on the New York Mercantile Exchange and Brent crude traded on the Intercontinental Exchange reversed sharply higher in afternoon trade Thursday, lifting West Texas Intermediate above $90 per barrel (bbl). The moves came amid a one-two punch of a rapidly weakening U.S. dollar index ahead of the release of U.S. employment report for January that could show job losses, and a potential for wellhead freeze-offs in Texas and Oklahoma oilfields as a potent winter storm lays siege on a large swath of the country from northeastern Texas, through the Midwest to states in the Northeast. DTN Weather forecasts negative temperature anomalies for several cities along the storm's 2,000-mile path through this weekend and into early next week, including subfreezing temperatures in Dallas-Fort Worth area and Tulsa, Oklahoma, with readings below freezing seen in Houston from Thursday through Saturday. Prolonged subfreezing temperatures could lead to wellhead freeze-offs, frozen pipes, and equipment failures, as numerous pipelines in Texas run aboveground and equipment is largely unwinterized. The region's cold anomaly resurrected memories of Winter Storm Uri a year ago, when more than 1.3 million bbl in daily oil output was shut-in. As of Thursday afternoon, the Texas power grid was meeting the state's electricity demand, according to the Texas Gov. Greg Abbott and state officials managing Texas's emergency response to the winter response. In financial markets, U.S. dollar index slumped more than 0.5% against a basket of foreign currencies to finish the session at two-week 95.379, as currency traders' position ahead of January's nonfarm employment report set for release at 8:30 a.m. EST on Friday. The median consensus calls for roughly 200,000 jobs to have been added last month, but not all economists are so optimistic. Investment bank Goldman Sachs expects Friday's report to show a decline of 250,000 jobs, with the wide range of expectations including estimates that as many as 400,000 job losses occurred last month. U.S. jobless claims leading up to the report do not paint a rosy picture. Weekly applications for unemployment benefits rose for the first two weeks of January before reversing this trend around the midmonth -- roughly around the time when the Bureau of Labor Statistic stops its data collection. On Wednesday, payroll provider Automatic Data Processing indicated private businesses shed 301,000 jobs last month -- the biggest drop since the start of the pandemic. On the session, March WTI futures added $2.01 to settle at $90.27, and international benchmark Brent crude for April delivery advanced $1.64 for a $91.11 per bbl settlement. NYMEX March RBOB futures rallied 3.57 cents to $2.6427 gallon, and March ULSD futures surged more than 7 cents to $2.8395 per gallon.

Oil hits fresh seven-year highs as rally extends to a 7th week - (Reuters) – Oil prices surged to fresh seven-year highs on Friday, extending their rally into a seventh week on ongoing worries about supply disruptions fueled by frigid U.S. weather and ongoing political turmoil among major world producers. Brent crude rose $2.16, or 2.4%, to settle at $93.27 a barrel having earlier touched its highest since October 2014 at $93.70. U.S. West Texas Intermediate crude ended $2.04, or 2.3%, higher at $92.31 a barrel after trading as high as $93.17, its highest since September 2014. Brent ended the week 3.6% higher, while WTI posted a 6.3% rise in their longest rally since October. The market’s surge accelerated in the last two days as buyers piled into crude contracts due to expectations that world suppliers will continue to struggle to meet demand. U.S. jobs figures were surprisingly strong in January, despite the presence of the Omicron variant of the coronavirus. Crude prices, which have already rallied about 20% so far this year, are likely to surpass $100 per barrel due to strong global demand, market strategists said this week. Some, however, see risks to the rally. Citi Research said it expects the oil market to flip into surplus as soon as the next quarter, putting the brakes on the rally. “A spike towards $100 crude should not be ruled out in the short run, but downside risks are plentiful, including Omicron setbacks on demand, economic growth concerns and financial market corrections as the central banks fight inflation,” said Bjørnar Tonhaugen, Rystad Energy’s head of oil markets. Winter storms bringing icy conditions in the United States, particularly in Texas, also fueled supply fears as extreme cold could cause production to shut temporarily, similar to what happened in the state a year ago. Tight oil supplies pushed the six-month market structure for WTI into steep backwardation of $9.06 a barrel on Friday, its widest since September 2013. Backwardation exists when contracts for near-term delivery are priced higher than those for later months – and is reflective of near-term demand that encourages traders to release oil from storage to sell it promptly. The number of U.S. oil rigs, an early indicator of future output, rose two to 497 this week, its highest since April 2020, energy services firm Baker Hughes Co said. [RIG/U] Even though the oil rig count has climbed for a record 17 months in a row, the weekly increases have mostly been in single digits and production is still far from pre-pandemic record highs as many companies focus more on returning money to investors rather than boosting output. Oil markets have also gained support from geopolitical risks as major oil producer Russia has amassed thousands of troops on Ukraine’s border, and is accusing the United States and its allies of fanning tensions.

U.S. oil benchmark posts highest finish since September 2014 - Oil futures rallied on Friday to tally a seventh straight weekly rise, with the U.S. benchmark marking its highest finish since September 2014, as a harsh winter storm raged in the U.S., piling onto myriad supply worries. "The latest upswing was triggered by a cold snap in Texas, which is fueling concerns about production outages in the Permian Basin, the largest U.S. shale play. A year ago, a period of extreme cold weather had caused massive disruptions to oil production there," More heavy precipitation and ice was expected to hit the eastern portion of the country Friday. West Texas Intermediate crude for March delivery climbed by $2.04, or 2.3%, to settle at $92.31 a barrel on the New York Mercantile Exchange. That was the highest finish for a front-month contract since Sept. 29, 2014, according to Dow Jones market Data. For the week, prices traded 6.3% higher. April Brent crude , the global benchmark, gained $2.16, or 2.4%, to $93.27 a barrel on the ICE Futures Exchange, marking the highest settlement since Oct. 2, 2014. Prices saw a weekly rise of 5.4%. "Oil prices are rising more than fundamentals suggest," "Stocks are starting to build (even outside of China), refiners are heading towards maintenance season, and supply is growing at record rates," supported in large part by U.S. shale growth resuming," she said. Still, there are soaring risks to supply, including the Russia-Ukraine crisis, OPEC+ capacity constraints, and financial interest in oil is strong, said Kim. Also "looming over markets is an Iran nuclear deal that could lift some pressure, or exacerbate it." On Wednesday, the Organization of the Petroleum Exporting Countries and its allies stuck with an initiative to boost production by another 400,000 barrels a day in March. "The market had been relying on OPEC+ to gradually raise volumes, but had overestimated their ability to actually do so," OPEC member states have been unable to produce oil at their assigned quota levels -- worsening the supply-demand deficit, he said. Read:Why OPEC+ can't hit its oil production targets--and what it could do about it "As a result, the market has found itself stretched in all directions: multiyear low inventories among OECD countries, coupled with razor thin spare capacity anywhere ---- and no signs of real investments in oil and gas projects," said Raj. "Then you add geopolitical tensions to the mix, and you see why oil is headed to $100," he said. Still, the path to $100 oil would likely require a "geopolitical triggering event." "The only spare oil production capacity is now at the hands of the three usual suspects -- Kuwait, Saudi Arabia and the United Arab Emirates, Raj said. "Now that spare capacity is so little, even the slightest tension can trigger spikes in oil prices." In other energy trading, March gasoline rose about 1.4% to $2.679 a gallon -- ending 5.5% higher for the week, while March heating oil added nearly 1.3% to $2.875 a gallon, for a weekly rise of 6%. March natural-gas futures fell 6.5% to $4.572 per million British thermal units, ending 1.4% lower for the week.

US & Iran Close To Reaching Nuclear Deal In Vienna, Biden Officials Signal - Biden administration officials are signaling that the US and Iran are close to reaching an agreement to revive the nuclear deal, known as the JCPOA, The New York Times reported on Monday. The JCPOA negotiations that have been ongoing in Vienna are currently on pause as diplomats have returned to their capitals for consultations. Envoys on all sides have signaled the talks are entering their final stage and that now "political decisions" need to be made. Even though the Biden administration has maintained a hardline stance towards Iran, US officials are putting the responsibility to revive the JCPOA on Iranian leadership. A senior State Department official told reporters on Monday that if Iran is willing to make the necessary "decisions" quickly, the US can "see a path to a deal."The official wouldn’t detail what the major sticking points are between the US and Iran. An Iranian official said Monday that there are still "significant issues" regarding the removal of sanctions to resolve. Iran is also seeking guarantees that the US won’t withdraw from the deal again.

U.S. Conducts 'Successful' Raid on ISIS in Syria, Civilians Die in Battle - The U.S. military has conducted a nighttime raid against the head of the Islamic State militant group (ISIS) in Syria's insurgent-held northwestern province of Idlib. While no U.S. casualties were reported, a number of civilians died as well as a result of what President Joe Biden's administration has said was a suicide blast by the ISIS leader. "U.S. Special Operations forces under the control of U.S. Central Command conducted a counterterrorism mission this evening in northwest Syria," Pentagon Press Secretary John Kirby said in a statement early Thursday, confirming the news. "The mission was successful. There were no U.S. casualties. More information will be provided as it becomes available." Hours later, President Joe Biden confirmed that the target was ISIS leader Abu Ibrahim al-Hashimi al-Qurayshi, also known as Hajji Abdullah. The news came after hours of speculation prompted by local reports, some of which suggested civilians had been killed.An initial report issued during the raid by the Syrian Observatory for Human Rights, a United Kingdom-based office tied to Syria's exiled opposition, reported that the U.S.-led coalition helicopters conducted bombings in an area between Idlib and Aleppo provinces west of Deir Ballut village. The helicopters also dropped off personnel, who called for the evacuation of women and children from nearby homes before storming them, it added. Citing unnamed sources, the observatory said violent clashes took place as part of an operation targeting a non-Syrian jihadi figure.The activist network reported that the operation began around midnight and bore similarities to the October 2019 raid in Idlib that ended in the death of Qurayshi's predecessor and ISIS founder Abu Bakr al-Baghdadi, including the takeoff of aircraft from the nearby "Khurab Ashek" base in the northern Syrian town of Kobani, also known as Ayn al-Arab. Echoing other reports of those following the operation, the observatory identified the target location specifically as a two-story building with a basement in the village of Atmeh.

Witnesses describe what happened: ‘Those who remain will die.’ --The neighbors had never heard anything like it. Just after midnight, the whir of military helicopters flying low toward their homes in a pastoral stretch of northwestern Syria roused them from their sleep.Then a voice rang out in Arabic from a loudspeaker, ordering the occupants of a nearby house to give themselves up.“Those who want to take part in jihad, come out!” the voice said, according to a close neighbor who gave only his nickname, Abu Omar. “Everyone will be safe if you surrender. Those who remain will die.”The United States has hailed the rare airborne raid by commandos in a rebel-held patch of Syria early Thursday as a major success against terrorism, saying it ended the life of the shadowy leader of the Islamic State, known as Abu Ibrahim al-Hashemi al-Qurayshi.But for families living on the outskirts of the town of Atmeh near Syria’s border with Turkey, the raid made for a night of fear and left a house full of dead neighbors they said they had never really known. At least 13 bodies were recovered from the rubble left by the raid, rescue workers said, including six children.A neighbor who gave his name as Abu Muhammad said that his family was so terrified by what they heard outside that they did not even peek out the windows. Then they heard heavy banging on the door and opened it to find American commandos and an Arabic-speaking interpreter.They were told they would not be harmed, and were directed to flee the house and hide behind another building until the confrontation was over. The family did as they were told and hid in the cold until all had fallen quiet, Abu Muhammad said. On their way back to their house, he said, they saw the body of a dead child.

US Says NO to Food as Human Right While Afghanistan Suffers Under Sanctions -- On November 9, 2021, the United States, the world's most vocal supporter of human rights, voted against a United Nations committee's draft on the right to food which passed by 180 votes in favor to 2 against (Israel, United States). The UN committee expressed alarm that in 2020, "the number of people lacking access to adequate food rose by 320 million ‑ to 2.4 billion ‑ amounting to nearly a third of the world’s population, and that between 720 million and 811 million people faced hunger". Currently, the hunger situation in Afghanistan is the most acute with over half the population suffering from extreme levels of hunger. Afghanistan has been subjected to US sanctions since the US loss to the Taliban in 2021. “Hunger is a violation of human dignity”, Cuba’s delegate said while addressing the UN Committee meeting. Presenting the draft, he voiced concern that the United States has blocked consensus on the text for four years in a row. The United States representative — highlighting conditions in the Lake Chad Basin, Yemen and Somalia ‑ said the draft contains unbalanced and inaccurate positions that her delegation simply cannot support. The concept of food sovereignty could justify food protectionism, negatively impacting food security, she explained, adding that the United States does not recognize the right to food, as it lacks a definition in international law. Meanwhile, Shelley Thakral, the World Food Program spokesperson for Afghanistan, says more than half the population — some 23 million Afghans — are facing what the WFP calls extreme levels of hunger. Malnutrition is soaring. Food prices have risen. And the WFP's surveys show the overwhelming majority of Afghans, 98% of the population, lack enough food to eat. Many are surviving on limited diets with less fresh vegetables, dairy or meat – or none at all, according to an NPR report.