Month: June 2017

  • Indian Consortium Offers To Invest $11B In Iranian Oil Field

    An Indian consortium led by ONGC Videsh has offered Tehran US$11 billion in investments into the Farzad-B natural gas field on the condition that the Iranian authorities can guarantee it a reasonable level of returns. Reasonable, according to ONGC, is 18 percent, according to the managing director of the company’s overseas investment arm, who spoke to Bloomberg. Negotiations between Indian companies and Iran on the development have been going on for a while now, with pressure building between the parties over the last couple of months…

  • Goldman Sachs Sells Off $300 Million In PDVSA Bonds At A Slim Profit

    Goldman Sachs has sold of a portion of the Venezuelan bonds it purchased in May, causing market commotion at the time of the initial $2.8 billion transaction last month. The Wall Street Journal reported on Friday that the banking major sold $300 million worth of bonds to a hedge fund. Anonymous sources said Goldman made a slim profit from the sale, without providing additional details on margins. The entire multi-billion-dollar purchase of state-owned oil giant PDVSA’s bonds costed Goldman 31 cents on the dollar, due to the detrimental effects…

  • Japan And South Korea Secure Atlantic Crude As Winter Approaches

    Japanese and South Korean buyers will snap up Atlantic crude oil cargoes in the coming months, ahead of an expected demand boom in the winter, according to a new report from Reuters. Oil loadings from Europe and the Americas stagnated in June after an increase in shipments in March and May. Analysts say July could be a prosperous month for the North Sea Forties grade, as well as American crudes, as Asian players become more active. Japan’s JXTG and Cosmo Energy bought U.S. cargoes that are due to arrive in September, according to trade sources.…

  • Saudi Arabia Reports First GDP Contraction Since 2009

    Saudi Arabia’s gross domestic product fell in the first quarter of 2017 year-over-year, marking the first time the top oil exporter’s economy contracted after the 2014 oil price crash. Government data revealed a 0.5 percent contraction between January and March – the first such occurrence since 2009. The KSA’s economy shrunk due to production cuts it made as part of a deal with the Organization of Petroleum Exporting Countries (OPEC) to limit bloc-wide output to 32.5 million barrels per day. Saudi Arabia has consistently…

  • OPEC Output Reaches 2017 High As Libya Reaches 1 Million Bpd

    OPEC oil output reached a 2017 high in June as Libya and Nigeria continue a production recovery despite the bloc’s efforts to ease a global supply glut, the results of a new Reuters survey shows. The African duo is exempt from an OPEC deal to limit output to 32.5 million barrels per day through March 2018, but the June rate will surge to 32.72 million bpd – marking a 280,000 bpd increase from the previous month. This figure includes production from Equatorial Guinea, which only officially joined OPEC in May. Saudi Arabia and Kuwait…

  • Does This Oil Price Rally Have Legs?

    After a couple of miserable weeks, oil traders were finally offered some good news this week as prices started ticking back up, futures improved and bullish estimates began trickling in from analysts. Having endured a period of rock-bottom prices, benchmarks may be finally turning a corner, according to key market-watchers. But is the rally real, or just a temporary reprieve from long-term low prices? Bloomberg reported on June 29 that a rally in prices was imminent, as over-supply concerns that have dogged markets for weeks finally began to recede.…

  • Analysts See Oil Prices “Lower For Longer”

    The oil industry had hoped this would be the year the prices finally start to firm up. But the industry is having to once again get used to the idea of “lower for longer.” For the second month in a row, major investment banks are lowering their price forecasts. A Wall Street Journal survey of 14 investment banks finds an averaged predicted price for WTI at $52 per barrel for 2017, a decline of $2 from the same survey in May. The banks also now see WTI averaging $55 per barrel in 2018, again, down $2 from the May results. “Disappointment…

  • Is This Exxon’s Secret Weapon Against Electric Cars?

    Every now and then, an oil supermajor comes up with what they tout as a breakthrough in scientific research of renewable energy sources. This month, it was ExxonMobil’s turn to report a breakthrough in advanced biofuels. Exxon said that it had found a way to make algae ‘fatter’, and those algae could become part of the (distant) future energy mix, could cut carbon dioxide emissions, and would not compete with food crops like other biofuel sources. Exxon and Synthetic Genomics have been partners since 2009 in researching and developing…

  • How Pipeline Contracts Are Crushing Some Producers

    The contract model for oil pipeline space has some North American producers locked into high per-barrel transportation rates, while others benefit from steep discounts pedaled in bearish markets, a new report by Reuters says. Traditionally, producers that sign a long-term contract with a major pipeline company, such as Plains All American or TransCanada Corp, receive a generous discount for their commitment. The pipeline company can then utilize said receivables as collateral to secure funding for new routes, creating a cycle of asset growth.…