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Energy

  • China Filling Strategic Reserve With Cheap Oil

    With oil prices at new modern lows, China is seizing the opportunity to stock up.The Wall Street Journal reports that a division of China National Petroleum Corporation (CNPC) just completed the largest purchase ever for crude oil on an exchange based in Singapore, securing 40 tanker loads in October alone. The move comes after China’s oil consumption had its second highest month ever in September.The Dubai/Oman oil marker is a benchmark for crude oil coming from the Middle East, and there is a trading exchange in Singapore, where traders confirmed China’s latest move. On its face, the move is not…

  • Why Investors Shouldn’t Overlook Argentina’s Energy Reforms

    With presidential elections looming next October, international investors eyeing Argentina’s potentially prolific shale gas plays are biding their time. Cristina Kirchner is now well into her last term, marking the end of a government that has heavily regulated the energy industry and imposed economic restrictions that discourage foreign investment. But while anxious for a new administration to take power, investors must realize that some of the important reforms taking place today will set the stage for conditions in the energy sector for years to come. Argentina’s nascent shale industry represents one of the most promising frontiers for unconventional oil and…

  • Shell Needs Five More Years In The Arctic

    The damaged Royal Shell Dutch drilling barge Kulluk is loaded onto a transport ship in Unalaska, Alaska, on March 19, 2013.CREDIT: AP Photo / Jim PaulinRoyal Dutch Shell wants the U.S. government to give it another five-year crack at drilling in the Arctic.Back in July, the oil giant sent a letter to the Department of the Interior and its Bureau of Safety and Environmental Enforcement (BSEE), requesting that its leases — which will expire in 2017 — be paused for five years while the company regroups its attempts to start drilling operations. The letter was made public on Monday by…

  • How Long Can The Shale Revolution Last?

    A new study has cast serious doubt on whether the much-ballyhooed U.S. shale oil and gas revolution has long-term staying power.The U.S. produced 8.5 million barrels of oil per day in July of this year -- 60 percent more than just three years earlier. That is also the highest rate of production in three decades. Put another way, since 2011, the U.S. has added 3 million barrels per day in additional capacity to global supplies. Had that volume not come online, oil prices would surely be much higher than they currently are. That has “revolutionized” the energy industry and geopolitics,…

  • The Five Worst Climate Villains Among World Leaders

    Australian Prime Minister Tony Abbott and Canadian Premier Stephen have just landed near the bottom of a ranking of the world’s worst climate villains. The 2014 Climate Change Performance Index, published by Germanwatch and the Climate Action Network, called out Abbott and Harper for aggressively dismantling and blocking clean energy policies in their countries. They came in at 57th and 58th in a list of 61 names, and have some illustrious company at the bottom. Let’s take a look at the worst five.1. King Abdullah of Saudi ArabiaDead last on the Climate Action Network’s list and holder of the worst…

  • Oil And Coal: Energy Substitution And How It May End Soon

    Figure 1 shows annual percentage contributions to total global energy consumption by fuel type since 1965. I plotted it up to see if it contained any hidden messages about the world energy market that had escaped my attention (the data used to construct all the graphs presented in this post are from the BP 2014 Statistical Review): Figure 1: Percent contribution to global energy consumption by fuel typeAt first glance there was nothing new. Oil‘s contribution peaked in 1973 and has been trending down ever since. Coal’s contribution declined rapidly between 1965 and 1977, but then it flattened out and after…

  • The End Of An Era: Is The US Petrodollar Under Threat?

    Recent trade deals and high-level cooperation between Russia and China have set off alarm bells in the West as policymakers and oil and gas executives watch the balance of power in global energy markets shift to the East. The reasons for the cozier relationship between the two giant powers are, of course, rooted in the Ukraine crisis and subsequent Western sanctions against Russia, combined with China's need to secure long-term energy supplies. However, a consequence of closer economic ties between Russia and China could also mean the beginning of the end of dominance for the U.S. dollar, and that could…

  • Four More Years Of Pain For Petrobras

    Brazil’s incumbent President Dilma Rousseff pulled off a victory on Oct. 26 in a runoff election, and the markets are not too happy about it. As recently as September, President Rousseff was not seen as the preferred candidate. Brazil’s stock market seesawed as the polls changed, declining when Rousseff gained ground and rising when it appeared that she was falling behind. In the end, Brazilian voters reelected her for four more years, and the day after the vote, Ibovespa – a leading index of about 50 Brazilian stocks – dropped nearly five percent. The reason is that investors think that…

  • Total Makeover: Can Pouyanné And Co. Move Forward In Russia?

    The head of French oil company Total is dead, and conspiracy theories and questions are swirling about the impact the future direction of the French energy giant will have on geopolitics and energy markets. A decision to continue investing in the Russian energy sector could sink Total’s ship, while withdrawal of that investment could create a Yuan-sucking vacuum and deepen a burgeoning Russian-Chinese partnership. As the investigation into the Oct. 20 plane crash that resulted in the death of CEO Cristophe de Margerie continues in Moscow, Total has begun to pick up the pieces. The company moved quickly to promote…

  • The End of the Crisis for Now: America Is Awash in Energy

    Across America, something unusual is happening on main streets, in suburban strips, and at country stores: workers are lowering the prices on the signs for gasoline.Veterans of the energy crisis that began in 1973 and has continued, with perturbations, ever since, are trying to get their heads around this enormous reversal of fortune: there is no energy crisis for any fuel in America as winter approaches. That was the message delivered loud and clear at the annual Energy Supply Forum of the United States Energy Association (USEA).Indeed the main problem, if there is one, is that oversupply is driving down…