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Geopolitics

  • Global Energy Advisory - 29th August 2014

    Geopolitical/Conflict DevelopmentsIraqi Oil UpdateIraqi government forces have reportedly thwarted another attempt by the Islamic State (IS) to take over the Baiji refinery in northern Iraq. This refinery accounts for around one-third of Iraq’s total production, but produces for the domestic market, not exports. Key producing fields, for exports, in the south remain unaffected so far by the IS advance. In the meantime, Iran has come out with clear support for new Iraqi Prime Minister, Shi’ite Haider al-Abadi, after the ouster of Nouri al-Maliki.  Iran has also been providing Iraqi Kurdish forces with weapons to fight back IS in the north,…

  • Libya May Be Focus Of Major Rift Between US And Regional Allies

    It had become clear by late August 2014 that Libya could no longer be seen as a unified state; at best it was in two parts, even with the communal leaderships of both sides professing a desire to resume national unity. By late August 2014, the country had two parliaments: one elected by the Libyan people, and the other given legitimacy solely by foreign support.   The situation seemed so intractable by that point that it was possible that a full military intervention by regional states, perhaps spearheaded by Egypt, could be attempted, with the goal of stabilizing the country and…

  • What Territorial Dispute? Vietnam Moves To Repair Relations With China

    The government of Vietnam is sending a senior politburo member to China to help repair relations that were strained over Beijing’s deployment of an oil rig in waters of the South China Sea claimed by Hanoi.The move, on May 1, started a serious dispute between the two countries, sparking violent and often deadly demonstrations in Vietnam and confrontations at sea between Vietnamese boats trying to approach the rig and Chinese coast guard vessels sent to protect it.Two-and-a-half months later, China withdrew the $1 billion rig, the Haiyang Shiyou 981, saying it had completed its work and should be moved out…

  • 3 Things A Deal With Iran Would Likely Include

    In mid-July, negotiators from the so-called P5+1 (the United States, United Kingdom, France, Germany, Russia, China and the European Union) reached a mutual agreement with Iran to extend an interim six-month agreement for another four months. The agreement extends concrete constraints on Iran’s nuclear program -- in particular, a halt to Iran’s production of 20 percent enriched uranium --  in return for modest and temporary sanctions relief for the Islamic republic. It will provide more time for negotiators to conclude a permanent agreement defining the future size and scope of Iran’s nuclear program in exchange for comprehensive sanctions relief.Although reports…

  • Russia’s Nuclear Revival And Its Challenges

    Russia is slowly but surely replacing its aging stockpile of Soviet-era nuclear weapons with an arsenal that’s fit-for-purpose in the 21st century. Richard Weitz reminds us, however, that a weakening Russian economy and less-than-favorable international climate may yet derail Moscow’s efforts to revive its nuclear prowess.Although attention is naturally focused on the role of Russia’s conventional forces in the Ukraine conflict, we should not overlook the modernization of the country’s nuclear forces. The last few years has seen Moscow make great progress in stabilizing Russia’s decaying nuclear arsenal. The Russian government considers its nuclear weapons as its best tool of…

  • Global Energy Advisory - 22nd August 2014

    Regulatory AlertsA new tax law granting tax credits to oil companies appears to have survived a close referendum battle on Wednesday, with partial vote counts in showing that efforts to repeal the legislation trailing behind. The legislation, Senate Bill 21, only narrowly made it through the Senate last year, advertising itself as a way to attract investment for new wells to produce more for the trans-Alaska pipeline. However, critics say it provides no guarantees that oil companies will invest in Alaska.Mozambique has approved favorable new petroleum laws that open the way for new oil and gas bids as well as…

  • Global Energy Advisory - 15th August 2014

    Geopolitical, Political & Conflict Updates•    High-level industry sources in Ukraine inform us that talk of extending the new gas tax beyond the end of the year is gaining in momentum, though lobbying by a united group of private gas producers plans to match that momentum. In order to convince Kyiv that it will be hanging itself over Russian gas if it goes through with this doubling of taxes on gas producers past 31 December 2014, we have to convince two political-business elite who are benefitting from the taxes. We have already heard from foreign-run industry sources who say they will…

  • U.S. Airstrikes Against IS Won’t Be Enough

    The followers of the new so-called Islamic State, formerly known as ISIS, have been on the rampage again this week, wreaking havoc and sowing death and destruction across Iraq. If U.S. President Barack Obama isn’t clear enough on the dangers presented by the fighters to the people in Iraq and Syria, perhaps he will understand the danger in allowing the Islamists control of Iraq’s and Syria’s oil facilities.The U.S. president made it clear over this past weekend that the American military intervention in Iraq is purely “for humanitarian reasons” and to protect U.S. military personnel deployed in the region. Then…

  • Global Energy Advisory - Ukraine Commits Financial Suicide

    Regulatory/Management AlertsDuring the first week of August, the Ukrainian government has moved to double tax for private gas producers, signaling the first move by key Ukrainian political-business elite to stymie any chance for reform of the energy sector and energy independence. According to our key source in Kiev--Robert Bensh, a partner in Pelicourt LLC, the majority shareholder of Cub Energy, the third-largest private gas producer in Ukraine: “This law is dangerous to the long-term security of Ukraine. It adds little to the budget and discourages drilling and investment in the upstream oil and gas sector as well as calls into…

  • Does UAE Conscription Law Signal the End of the Dream?

    The United Arab Emirates announced in June that it is introducing compulsory military service for all male citizens aged between 18 and 30 and setting up a new national defense and reserve force. The surprising development in the stable country can only be seen as a reaction to the growing unrest in the surrounding region – Iraq, Syria, Israel and the Palestinian territories.Men who have finished secondary school will have to serve nine months, while those who have not will serve two years. Service will be optional for women. Citizens who complete service will enjoy a range of benefits, including…