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Geopolitics / International

  • 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…

  • 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…

  • How Will Russia‚Äôs Annexation of Crimea Affect Energy Markets?

    Russia purportedly intervened in Crimea to protect ethnic Russians from neo-Nazi extremists that Moscow claims have infiltrated the transitional government in Kiev.  The results of the 16 March Crimean referendum are already assumed to be a foregone conclusion, with early figures indicating that the peninsula’s Russian majority voted 93% in favor of unification with Russia.But the reality probably lies in the two seemingly intractable subjects that unite and divide Russia and Ukraine – energy and military issues.The former – Russia’s need of Ukraine’s Soviet-era skein of natural gas pipelines that supply Moscow’s most lucrative European markets. Russia provides approximately a…

  • Iran Takes on the US: Is this Provocation, Defiance or Tomfoolery?

    Responding to the US naval presence in the Gulf, described by the Islamic Republic of Iran as “arrogant,” Iranian leaders have decided to dispatch a naval task force of their own to sail within proximity of US territorial waters. This move is difficult to judge whether it is an act of provocation, an act of defiance or an act of foolishness.And if one wanted to be really Machiavellian, is this a smart manoeuver intended to push the tension up a notch or two and with it the price of oil by a few dollars a barrel?What do you do if…

  • Post-Energy Reform, Mexico Signs First Oil Deal with Russia

    Russia's Lukoil has announced an agreement with Mexico's state-run oil company Pemex for exploration, extraction and cooperation on environmental best practices.The cooperation memorandum was agreed on the sidelines of the World Economic Forum in Davos, Switzerland, and represents the first foreign partnership to be forged since Mexico moved to reform its energy sector in December and to Pemex’s 75-year state monopoly over exploration and production. Since 1938, Pemex has controlled the entire hydrocarbons production chain in Mexico. In the past decade, however, falling investment and a sharp drop in production from 3.8 million barrels per day in 2004 to 2.6…

  • Turkey Energy Advisory

    We have had some requests from Oil & Energy Insider subscribers to evaluate the situation for foreign E&P companies operating in Iraqi Kurdistan and the potential impact the Turkish political crisis may have on them. Consulting with our intelligence wing, OP Tactical, we believe that for now, there is no perceived risk to foreign companies operating in Kurdistan, such as Anglo-Turkish superstar Genel Energy, Oryx Petroleum, Gulf Keystone or Afren. However, there have been concerns voiced to the effect that if the Gulenists manage to defeat Erdogan in this power struggle, Kurdistan could become less important to the Turkish agenda…

  • Iran, Russia Ruffle US Feathers with Oil Swap Deal

    Reports are emerging that Iran and Russia are in talks about a potential $1.5 billion oil-for-goods swap that could boost Iranian oil exports, prompting harsh responses from Washington, which says such a deal could trigger new US sanctions. So far, talks are progressing to the point that Russia could purchase up to 500,000 barrels a day of Iranian oil in exchange for Russian equipment and goods, according to Reuters. "We are concerned about these reports and Secretary (of State John) Kerry directly expressed this concern with (Russian) Foreign Minister (Sergei) Lavrov…  If the reports are true, such a deal would…

  • Why Oil is Mightier than the Sword for U.S. Foreign Policy

    The American Petroleum Institute said the United States is emerging as a superpower in terms of energy and should use that leverage by exporting crude oil overseas. Some U.S. lawmakers pressing for tighter sanctions on Iran, meanwhile, oppose the export drive, suggesting potential superpower influence may run up against protectionist policies. U.S. crude oil exports are restricted under legislation enacted in response to the 1970s Arab oil embargo. Now, with the U.S. Energy Information Administration predicting crude oil production will reach 9.5 million barrels per day by 2016, the industry and its supporters said it's time to reverse that policy. API in…

  • Iran Deal: Political Game-Changer or Epic Delusion?

    On Sunday, 25 November, in Geneva, the US and Iran made what can only be described as a landmark move towards ending sanctions despite a flurry of activity—including the bombing of the Iranian embassy in Beirut, which killed 23 and wounded 170 others—intended to derail any such progress.Even the foreign minister of France—a country now beholden to Israeli lobbying and Saudi money—noted that some sanctions currently in place against Iran could be lifted as early as December. Specifically, this initial agreement could free up around $7 billion for Iran--mostly from revenue transfers from restricted crude oil sales--and see the country’s…

  • How an Iran-US Deal Would Change the Strategic Landscape

    A rapprochement between the US and Iran — now possible because of the domestic political needs of both governments — would change the global strategic landscape. A strategic rapprochement between the two once-allied states, estranged since 1979, would cut a swathe through the geo-strategic reach of Russia and the People’s Republic of China (PRC) into the Persian Gulf/Middle East, and revive the prospect of a return of the US to influence in Central Asia.Moreover, it would relegate Turkey to second-tier status as far as the US was concerned, and could pave the way to the gradual transformation of Iranian society.…