Kremlin reasserts control of oil, gas
Fred Weir, Christian Science Monitor via Yahoo
MOSCOW – Call it PetroKremlin. A vast state-run energy conglomerate has been assembled over the past year, some experts say, to fuel Russia’s bid to revive Soviet-style great power status.
To date, the Kremlin has effectively renationalized almost a third of the formerly private oil-and-gas sector. Other developments also point to growing state ambitions:
• A $15-billion Siberian pipeline, due to begin pumping in 2008, will shift Russian crude exports to Asia, particularly China, where Moscow is cultivating fresh strategic relationships.
• A 737-mile gas line being laid under the Baltic Sea will cut out middlemen Ukraine and Poland, whose relations with Moscow have recently soured, while locking in Russia as Western Europe’s key energy supplier.
• State-run Gazprom has teamed up with several foreign partners to develop a vast Barents Sea gas field whose production, converted to liquefied natural gas (LNG), could begin supplying the US market by 2010. …
(28 December 2005)
Europe Frets About Russian Energy Reliance
GEORGE JAHN, Houston Chronicle
Russian natural gas surged through Ukraine to countries across Europe on Tuesday, banishing the specter of immediate and prolonged shortages because of Moscow’s price dispute with Kiev.
But relief was tempered by the realization that the continent’s dependence on Russian natural gas means it is vulnerable to future energy crises. About one-quarter of Europe’s gas comes from Russia _ 80 percent of that via Ukraine _ and the standoff raised fears of serious gas shortages during a cold winter.
European officials sought to dispel anxieties left after some countries saw gas supplies from Russia transiting Ukraine cut by as much as 50 percent _ a result of Moscow’s decision to halt deliveries to Kiev _ before Russia pumped extra gas and deliveries returned to normal.
(3 Jan 2006)
IEA Deputy Head:Russia Gas Cut Is A “Serious Mistake”
Dow Jones, The Business
Russia’s decision to cut Ukraine’s natural gas supply Sunday, due to a pricing dispute, was a “serious mistake” that will lead consuming nations to further examine diversifying their energy supply mix, the deputy head of the International Energy Agency said Tuesday.
“I think Russia has made a serious mistake. It has demonstrated its willingness to use its gas as a politcal and economic tool,” William Ramsey told Dow Jones Newswires in an interview.
(3 Jan 2006)
European gas crisis is warning to Britain, energy experts say
Kate O’Hara, Yorkshire Post
THE gas war raging between Russia and the Ukraine should serve as an important warning to Britain, energy experts say.
As a senior British Minister admitted that the dispute could affect the UK supply, and French utility Gaz de France SA said there had been a “significant deterioration” in natural gas flows from Russia, experts said Britain must ensure it was not overly reliant on imported gas.
The chairman of the Regional Energy Forum, David Bowe, who was a member of the Energy Research Committee in the European Parliament for 15 years, said: “This is a straw in the wind that we simply cannot ignore, because in five or 10 years time we could find ourselves in the hands of the Russians.
“This dispute shows how suddenly and unexpectedly an energy crisis can blow up, and we should see it as a very important message which we should learn for the future.”
(3 Jan 2006)
Middle East gas critical for global energy supply
AME Info
For many hydrocarbon producers in the Middle East natural gas is likely to become as important to their economies as crude oil production over the next 25 years.
Gas is the rising star of world energy and has a largely untapped abundance in the Middle East. Its cost-competitiveness and lower emissions make it the preferred fuel, especially for power generation, industries and for domestic energy needs. The industrial world and rising economies in Asia especially are looking to Arabia and Iran to meet a significant part of their future gas requirements.
Gas in demand
Middle East gas producers in their own right are also looking to provide the fast growing needs of their local power, desalination, industrial and domestic needs from natural gas.
The Middle East and North Africa contain some 45 per cent of the world’s proven gas reserves and the region’s share could rise considerably as exploration efforts accelerate in promising onshore areas, such as Saudi Arabia’s empty quarter and offshore in the Gulf.
(3 Jan 2006)
Oil Market Outlook 2006: Future Imperfect
Adam Porter, Resource Investor
PARIS (ResourceInvestor.com) — Like a lot of markets, the oil indexes are strange beasts indeed. Theories come and go. Waves of fashion wash across the shores of analysts, journalists and institutions alike. Quite amazingly most of them are wrong. If there is one tip about predicting the oil markets it is this: don’t.
Let us take a few of the fashion tips we have been handed in 2005 for review. Firstly many economists, especially the arch neo-liberal Michael Lynch, told everyone in 2004 that oil prices would be back at $35 by the summer time. Wrong.
Currently the average price of oil in 2005 is some 36.7% up on 2004. So in fact ‘wrong’ may be an understatement. The annual average price per barrel is trucking along just nicely at $56.70. As you may note, $56.7 is not $35. …
British chancellor Gordon Brown was perhaps the most senior politician to play this year’s oil blame game. In what may be an amazing coincidence, or shameless political opportunism, he attacked OPEC on national TV just a few days before planned British fuel protests. He said that OPEC was the cause of high prices. Nothing to do with the amount of fuel levy he (and previous Conservative Chancellors alike) places on British drivers. He said OPEC should pump more oil. They did. The price promptly rose to $70.
It would be less shameless, or coincidental, had not British North sea output carried on its astounding decline rate. It is down 50% since its 1999 record of 3.1 million barrels per day (mbpd) at under 1.6 mbpd. Gordon Brown was in reality asking OPEC to spend their money to make his life easier. Amongst analysts the derision was often off the record, but it was harsh. Gordon Brown however could be forgiven. He is a politician. They always have a string of amazing coincidences going on in their lives. Cynics might say they talk in the language of plausible deniability in the same way as a shoplifter or burglar. But we have no time for cynics do we?
The International Energy Agency (IEA) however has slightly less excuse. Energy is their raison d’etre, not political power. Or at least that is what they say. They predicted that in 2005 non-OPEC output growth would be 1.38 mbpd. That figure has now been revised. It now stands at 0.1 mbpd. That in itself may yet be revised, downwards. So currently the IEA’s non-OPEC output growth forecast is only just out. If you could say that an error of 92.75% is ‘just out’. If you want to say that, maybe you could contact Gordon Brown. It is probably OPEC’s fault somehow. …
(23 December 2005)
Iraq’s oil exports hit lowest level since war oil
AP, Jerusalem Post
Iraq’s exports of oil hit their lowest level in December since the war, as the country’s oil minister resigned in the wake of protests and riots over soaring gas prices and lengthening lines at the pump.
Only 34.4 million barrels were exported in December, or about 1.1 million barrels per day, the lowest average since Iraq resumed exports after the US-led invasion in March 2003, according to figures released Monday.
Almost all the oil was exported from Iraq’s southern oil terminals because of continuing sabotage of the country’s northern oil facilities.
On Monday, Iraq resumed exports from its southern oil field after more than a week of bad weather and a lack of tugboats to handle tankers, an official who could not be identified for security reasons told Dow Jones newswires.
(3 Jan 2006)
Iraq moves to tackle fuel crisis
Australian Associated Press
Iraq started trucking fuel from its main oil refinery in the north to cities across the country to ease a crisis that has triggered panic buying and long queues at petrol stations.
Exasperated drivers waited for over three hours to fill their tanks in Baghdad, capital of a country which sits on the third-largest proven oil reserves in the world, as trucks rolled out of the Baiji refinery for the first time in 10 days.
Nearly three years after a US invasion which many thought would lead to the revival of Iraq’s dilapidated oil industry, the authorities cannot provide their citizens with even basic fuel requirements. …
The crisis has opened cracks in the government and led to what looked like an old-style ministerial coup. Oil Minister Ibrahim Bahr al-Uloum was placed on a month’s leave against his will and Deputy Prime Minister Ahmad Chalabi appointed in his place. Uloum complained he was pushed aside because he opposed the December 19 price rises. …
(1 January 2006)
The fuel price rises are upon the instructions of the International Monetary Fund, which has mandated similar ‘adjustment programs’ for dozens of impoverished countries around the world in recent decades (but not for the worlds #1 debtor country, the USA). Is it any surprise neoliberal globalisation at gunpoint has an ‘image problem’? -LJ
Word Spreads in Iraq of Refinery Shutdown
Sinan Salaheddin, Associated Press via Forbes
Long lines formed at gas stations in Baghdad on Friday as word spread that Iraq’s largest oil refinery had shut down, spreading fears of a gas shortage.
Iraq’s largest oil refinery, in Beiji, was shut down on Dec. 18 because of the deteriorating security situation in the region, Minister of Oil Ibrahim Bahar el-Ulom told The Associated Press on Friday. A spokesman earlier had said the refinery had been shut down since Saturday. “The capacity of this refinery is 7 to 8 million liters a day (of gasoline), and it is considered one of the vital refineries in Iraq,” he said. That’s equivalent to about 2 million gallons of gas a day. …
Ali Moussa, a 51-year-old tanker truck driver, said he and his colleagues were working in a dangerous situation. “We demand that the government provide security and protection,” he said. “The Beiji storage tanks are full and there isn’t any shortage of gas there. The problem is that drivers are too afraid to go there unless they are protected.” …
(30 December 2005)
Blood Flows With Oil in Poor Nigerian Villages
Lydia Polgreen, NYTimes
OBIOKU, Nigeria – At first glance, it is hard to imagine anyone fighting over this place. …
Yet for months a pitched battle has been fought between communities that claim authority over this village and the right to control what lies beneath its watery ground: a potentially vast field of crude oil that has caught the attention of a major energy company.
The conflict has left dozens dead and wounded, sent hundreds fleeing their homes and roiled this once quiet part of the Niger Delta. It has also laid bare the desperate struggle of impoverished communities to reap crumbs from the lavish banquet the oil boom has laid in this oil-rich yet grindingly poor corner of the globe. …
(1 January 2006)
Shell ships 1st oil from Nigeria’s 1st deepwater field
Xinhuanet
Royal Dutch Shell has shipped the fist consignment of 200,000 barrels of crude oil from Bonga, the first deepwater oil and gas field in Nigeria, a company statement said on Tuesday.
“We are delighted to be exporting crude from Bonga, following the start-up of production on November 25 2005,” the statement quoted Chima Ibeneche, managing director of the Shell Nigeria Exploration and Production Co., a subsidiary of Shell in Nigeria, as saying.
Oil production at the Bonga facility, whose target nameplate output is 225,000 barrels of oil and 150 million standard cubic feet of gas per day, is expected to ramp up to some 200,000 barrels per day in 2006.
(3 Jan 2006)
