tag:blogger.com,1999:blog-18262465886001550442024-03-29T11:02:18.158+00:00Crude Oil FuturesUnveiling Oil & Gas Beyond the HypeUnknownnoreply@blogger.comBlogger493125tag:blogger.com,1999:blog-1826246588600155044.post-32839872602575098832024-03-27T21:57:00.003+00:002024-03-27T22:25:59.779+00:00Will Venezuela manage to extend the period of waiver of sanctions?<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgQwz1_x4oCeRIyp3a60Bh1BFPd1CUMjYH_BXYl9ranSk0O_XGFykVh-beV3uaJfl_xoQKwCwToDVvaxZ39DO16rNM9UpxLNMHOdHONlxKKH_cF8Mxa1nhWk1TAcSeqwKrhkGK2UXiNtdUlU8hq9UGhtZZWoCn1CL8zspC1aTqPiHKvoIx8gZMbfD4UjDo/s600/crude-oil-reserves-by-country.png" style="margin-left: auto; margin-right: auto;"><img alt="Crude oil reserves by country" border="0" data-original-height="371" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgQwz1_x4oCeRIyp3a60Bh1BFPd1CUMjYH_BXYl9ranSk0O_XGFykVh-beV3uaJfl_xoQKwCwToDVvaxZ39DO16rNM9UpxLNMHOdHONlxKKH_cF8Mxa1nhWk1TAcSeqwKrhkGK2UXiNtdUlU8hq9UGhtZZWoCn1CL8zspC1aTqPiHKvoIx8gZMbfD4UjDo/s16000/crude-oil-reserves-by-country.png" title="Crude oil reserves by country" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Chart:www.oilfutures.co.uk | Data: OPEC</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">As the 53rd JMCC, Joint Ministerial Monitoring Committee, of the OPEC+ is scheduled to take place on April 3, analysts are looking at every possible scenario that could rise in the aftermath of such a meeting.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">A consensus has already emerged among them that the OPEC+ would stick to its production quota for each member country. That means the official position of the OPEC+ will maintain the current production cuts as long as necessary, without increasing the production to appease the influential customers. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The cartel wants to stick to the production targets, already agreed upon, in 2024 without unnecessarily worries about the potential consequences. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">With the OPEC+ sticking to it guns, without increasing the output, the top consumers of oil turned to Venezuela to buy it on the cheap as the former was given a waiver to increase the production and then sell, provided that free and fair elections will be held before the waiver expires.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Venezuela is grabbing global attention again, because the current waiver of sanctions is going to expire in April, 2024. With the existing waiver, a limited number of countries such as India and China are allowed to import oil from the Latin American country in order to manage the demand for the commodity, something, if not handled, can lead to surge in oil prices.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Venezuela currently boasts the largest oil reserves in the world. According to the OPEC+, it is estimated to be around 303,221 million barrels. It is much larger than that of Saudi Arabia, which is estimated to be 297,192 million barrels. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Despite huge oil reserves, the political upheavals coupled with the Western sanctions, have left Venezuela in ruins, both politically and economically. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although it has been battling hyperinflation for years with the currency in free fall, there has been signs of economic growth boosted by the waiver of sanctions.</span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span style="font-size: large;">The condition for the sanction waiver by the US is holding free and fair elections in 2024; the elections may be held, but the sole candidate appears to be the incumbent, President Maduro, with the potentials rivals remaining disqualified.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://en.mercopress.com/data/cache/noticias/96205/0x0/mcm-maduro.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img alt="President Maduro & Opposition leader Machado" border="0" data-original-height="533" data-original-width="800" height="426" src="https://en.mercopress.com/data/cache/noticias/96205/0x0/mcm-maduro.jpg" title="President Maduro & Opposition leader Machado" width="640" /></a></div>President Maduro & Opposition leader Machado: image credit - MercoPress<br /></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Making matters worse, Venezuela has been threatening Guyana, the neighbour, while reigniting a long running territorial dispute over </span><span style="background-color: white; color: #1f1f1f;"><span style="font-family: inherit; font-size: large;">Essequibo region that is well known to be oil rich</span></span><span style="font-size: x-large;"> oil fields. With Venezuelan troops on stand by, the tension between the two nations remain high and volatile; any potential military move by Venezuela will trigger off a significant international backlash and certainly, the waiver of sanctions being removed. In short, the stakes cannot be higher for Venezuela. </span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhxc0JO9-hWQh1J0TnF5dfDKGDqpgoiTAYJY5-TnFhYTYXe2s59KyoCKI9POn9Mgul2rvjYfcyfEBUWuGNGtfb4XnMeTTboG3MsVakv6b0KtbjkNxpyYlz1wiGmOA9YnwhKlFBgJWBg7SZ6bPT0t3CRIumDZuzruRTKFfxIYT5x6U-Pw6TUJ2dXoSGxt3E/s558/venezuela-guyana.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img alt="Venezuela and Guyana Map" border="0" data-original-height="351" data-original-width="558" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhxc0JO9-hWQh1J0TnF5dfDKGDqpgoiTAYJY5-TnFhYTYXe2s59KyoCKI9POn9Mgul2rvjYfcyfEBUWuGNGtfb4XnMeTTboG3MsVakv6b0KtbjkNxpyYlz1wiGmOA9YnwhKlFBgJWBg7SZ6bPT0t3CRIumDZuzruRTKFfxIYT5x6U-Pw6TUJ2dXoSGxt3E/s16000/venezuela-guyana.PNG" title="Venezuela and Guyana Map" /></a></div></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In these circumstances, the US has threatened to reimpose sanctions, if Venezuela goes back on its promise. As a consequence, the big consumers show apathy, when it comes to sign long term contracts for importing oil from Venezuela. Indian media, for instance, says that the Indian refineries are reluctant to sign long term contracts, fearing the return of sanctions.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In this context, the Venezuelan factor has the potential to make an impact on the supply concerns of the commodity, at least at sentimental level, although Venezuela only managed to increase the production marginally during the lucky window of opportunity for selling its oil thanks to waiver.</span></div><br /><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-37521733807283987682024-03-20T11:04:00.006+00:002024-03-20T11:31:50.776+00:00The trend in China's Oil Imports in 2023: the stagnation of the prices is partially explained!<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjyWJlvRfqVTPNC7wBqFNa8agi7R6DRfKab-mZJW4vlayJteT3V85Z-QRmI9rnLAlWw7qhQGOxk6zKjcTW1vfPCAcJ0Bd9lpsTHPJXBhY_LIjtjVddRJNT3AfjGQbbUNt8TDJ6QC02IkR3uLcOPeJZwa2Li9la_oi5Jnn6NLlINwciHU21H8Wbd7pKfo4w/s614/China-Crude-Oil-Imports.png" style="margin-left: auto; margin-right: auto;"><img alt="China's crude oil imports in 2023" border="0" data-original-height="380" data-original-width="614" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjyWJlvRfqVTPNC7wBqFNa8agi7R6DRfKab-mZJW4vlayJteT3V85Z-QRmI9rnLAlWw7qhQGOxk6zKjcTW1vfPCAcJ0Bd9lpsTHPJXBhY_LIjtjVddRJNT3AfjGQbbUNt8TDJ6QC02IkR3uLcOPeJZwa2Li9la_oi5Jnn6NLlINwciHU21H8Wbd7pKfo4w/s16000/China-Crude-Oil-Imports.png" title="China's crude oil imports in 2023" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">www.oilfutures.co.uk<br /><br /></td></tr></tbody></table><p></p><div style="text-align: left;"><span style="font-size: large;">The data from 2023 clearly shows that China, the world's top importer of crude oil, is a factor that cannot be ignored when it comes to the stability in the crude oil markets.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The trendline, based on the crucial crude oil import volumes, shows a gradual, not a steep, decline in line with the fluctuating manufacturing activities. The trendline of China's Purchasing Manager's Index, PMI, followed a similar pattern in 2023.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg5mf5_WqczTwkoTdbv1r5zuSWEgSqC257f4up0cUxtkKxu3v_8AXXrA5ClvNOgI_plIjV2TZgqlHgbFfON9PbxUO0R-CMxGi9zLcImEe8fgk8B8kRVonuPBFLGPy1x99bXdd_3TDv_nmz6qn_frlmJlfrRJ3ZshbxVG2WtM_YDaUWE8O0N3qYbUhXJCNs/s562/China-Manufacturing-PMI.png" style="margin-left: 1em; margin-right: 1em;"><img alt="China's manufacturing PMI" border="0" data-original-height="345" data-original-width="562" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg5mf5_WqczTwkoTdbv1r5zuSWEgSqC257f4up0cUxtkKxu3v_8AXXrA5ClvNOgI_plIjV2TZgqlHgbFfON9PbxUO0R-CMxGi9zLcImEe8fgk8B8kRVonuPBFLGPy1x99bXdd_3TDv_nmz6qn_frlmJlfrRJ3ZshbxVG2WtM_YDaUWE8O0N3qYbUhXJCNs/s16000/China-Manufacturing-PMI.png" title="China's manufacturing PMI" /></a></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">There was a relative surge in crude oil imports in February on account of heavily discounted Russian oil after the war broke out between Ukraine and Russia. Both China and India cashed in on the unbelievable bonanza, defying international pressure, citing the domestic interests. </span></div></div><p></p><div style="text-align: center;"><div class="separator" style="clear: both; text-align: left;"><div><span style="font-size: large;">In August last year, there was a relative increase in the imports: In September, China's PMI, Purchasing Manager's Index that reflects the nation's manufacturing activities remained above the threshold - 50%.</span></div></div></div><p style="text-align: center;"></p><div style="text-align: left;"><span style="font-size: large;">Analysts, meanwhile, are awaiting the latest PMI from China for March this year to see whether it has gone above the crucial 50% mark; only three times in 2023, was it above the threshold in 2023 - in February, March and September. The crude oil imports in these months speak for themselves.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In another development, China's National Bureau of Statistics, said that the youth unemployment rate has gone up in February by 0.7%; the unemployment rate among the youth, aged 16-24, remains at 15.3% - a significant figure, indeed.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In the crude oil markets, meanwhile, there was a modest increase in the prices of oil, As of 10:30 GMT on Wednesday, WTI and Brent recorded $82.76 and $86.76 respectively. The price of natural gas was at $1.73. The US crude stocks have been falling for the past few weeks, according to the EIA, US Energy Information Administration.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Some analysts attribute the rising oil prices to the falling US oil stocks, implying a steady increase in demand. The long term trend, however, remains to be seen, because the demand - or lack of it - in China can still heavily influence the trend. </span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">On political front, the mutual mistrust between China and the West, meanwhile, shows no sign of abating. On the contrary, it gets worse by each passing month.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The ban of TikTok by the US is a case in point. On this occasion, at least, China cannot hit back in kind! The US tech giants such as X, former Twitter, and Facebook have not been in operation in China for years. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">With the banning of hugely popular video sharing app, however, the remaining tools for reviving - or salvaging - what is left of the relations between the world's top most economic powers are slowly heading to being redundant.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">When the campaigning of the forthcoming US presidential election in November gets into full swing, the energy issue is going to be at the top of agenda for both parties, as the latter is the key factor that determines the inflation at present.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">President Trump has already made it clear what his energy policy would be. In the coming months, President Biden will explain his position too. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Between the two ideological positions, the energy pendulum will oscillate up until November with the Chinese economic trends generating the unhelpful drag on the movements as the time elapses. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><br /><p></p><p style="text-align: center;"><br /></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-90183249878381690962024-03-13T15:12:00.305+00:002024-03-14T08:36:25.159+00:00Strategic Reserves and Domestic Production: Unpacking US Options for Oil Price Fluctuations<p style="text-align: center;"></p><div style="text-align: center;"> <div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS2gw4Q4MaDi4MioiB_ALYKgj_aS5pk1IFHSpEghhcUIiPtzvl0ayry_4RzBCEl-GEtQgJXrDa1w-59NwmiAea0nYTK6m3hkkkwPcZu_O-bp4aXlLhnAhNVwOglIgJiS7WGbWzcPmA1ME50SjQz3x0YBEmR5qiyO1PgbyoN_uZnJ2K4uQzpQvwtVtXZdQ/s521/Oil-production-by-%20Country-2023.png" style="margin-left: 1em; margin-right: 1em;"><img alt="Oil production by country - 2023" border="0" data-original-height="325" data-original-width="521" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS2gw4Q4MaDi4MioiB_ALYKgj_aS5pk1IFHSpEghhcUIiPtzvl0ayry_4RzBCEl-GEtQgJXrDa1w-59NwmiAea0nYTK6m3hkkkwPcZu_O-bp4aXlLhnAhNVwOglIgJiS7WGbWzcPmA1ME50SjQz3x0YBEmR5qiyO1PgbyoN_uZnJ2K4uQzpQvwtVtXZdQ/s16000/Oil-production-by-%20Country-2023.png" title="Oil production by country - 2023" /></a></div><br /></div><div style="text-align: center;"><br /></div><div style="text-align: left;"><span style="font-size: large; text-align: left;">The latest data from the EIA, US Energy Information Administration, suggests that the US had been the largest producer of crude oil in 2023, despite turning to other sources to boost the global oil production.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">It has been more than 4 years since the US became a net exporter of crude oil. The data explicitly shows that the US retains the crown for the largest production, while pushing both Russia and Saudi Arabia down to the second and third place respectively.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As of December 2023, the US accounted for 12.9% of the global oil production. The same figures for Russia and Saudi Arabia were 10.1% and 9.7% respectively.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The contribution from the UAE, a close ally of the Kingdom, was just 3.4%. In this context, the reported reluctance of lowering the quota in line with the more powerful members of the OPEC+ by the UAE is perfectly understandable, as it means losing a big chunk of its vital revenue stream.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">It is interesting to note the contribution by Iran to the global oil supply: it stood at mere 3.4% despite the noise about sanction busting moves in the media; it looks like that the years of sanctions at many different levels have hampered process of modernizing the aging infrastructure that in turn resulted in relatively low oil output.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The news about the US becoming the top producer comes amidst concerns that the US has not met the target of filling its SPR, Strategic Petroleum Reserve, as planned, despite the falling oil prices. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The US started releasing oil from its SPR in order to make the global oil prices stable, when the OPEC+ chose to curtail the production in order to do the exact opposite. In the end, the US strategy seems to have worked as the price of oil did not skyrocket as some investment bankers prophesized. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhOOkdaL2IHXea0lBeSiHsRKT4UpT1_vgUnDXm0bVbhzRPSmYltCIlK7p52vkB4GnyLWZMGu8Rc6SaaTjc-3xU5GjMtpGHa9KQYc4GmPHGh81WaCgbn9gXKJQpc5K1nd8EbLLal-VlbNxjGG-SCNc4nnhutKFWW-a1NehHQeRdLOO4dfqLLjyfzqdXNYu0/s956/US-oil-stocks-spr.png" style="margin-left: 1em; margin-right: 1em;"><img alt="US Crude stocks including SPR" border="0" data-original-height="431" data-original-width="956" height="289" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhOOkdaL2IHXea0lBeSiHsRKT4UpT1_vgUnDXm0bVbhzRPSmYltCIlK7p52vkB4GnyLWZMGu8Rc6SaaTjc-3xU5GjMtpGHa9KQYc4GmPHGh81WaCgbn9gXKJQpc5K1nd8EbLLal-VlbNxjGG-SCNc4nnhutKFWW-a1NehHQeRdLOO4dfqLLjyfzqdXNYu0/w640-h289/US-oil-stocks-spr.png" title="US Crude stocks including SPR" width="640" /></a></div></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">With SPR, which is meant to to tapped into only in an emergency such as an outbreak of war, at a record low level, the Biden administration is not short of critics, who see the status quo being very risky, although there is no possibility of the US going to war with another country at present. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">According to the predictions by analysts, the US may fill about 10% of what has been released in order to address the issue of global availability of crude oil. The real figure, however, is estimated to be just 4%. The US has released 291 million barrels from its SPR during a period of 30 months since the administration came to power, leaving the vital reserve at the lowest level since 1983.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">With the presidential election just 8 months away, and the rival making the energy - or lack of it - one of the key issues to rally his troops around, the Biden administration cannot afford to get the numbers or strategy wrong in the coming months. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">In short, it has to walk a tight rope: on one hand, the climate lobby that was instrumental in bringing Mr. Biden to power cannot be made upset by going back on the pledge - not to issue new licenses for the oil exploration on Federal lands; on the other hand, President Biden cannot afford to let the consumers in the US suffer at the pumps, when they fill up their tanks; in order to address both issues, a well-rehearsed balancing act must be performed, something that is easier said than done. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The US crude stocks, meanwhile, have gone down for two successive weeks that led to the slight hike in oil prices. Both the API, American Petroleum Institute, and the EIA released data to that effect. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">If oil prices keep rising on account of this significant factor, the US may be compelled to supply the crude oil markets with more oil, especially in the election year; how the US is going to address the issue remains to be seen, though.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The remaining options for the Biden administration are very limited, though: the OPEC+ will not reverse production cuts - a fact; on the contrary, they are going to extend the period of cuts further; there is no possibility of reaching an agreement with Iran over the JCPOA, 2015 Iran nuclear deal, so that Iran will be able to make a comeback to the oil markets as a legitimate player; President Maduro of Venezuela is about to announce a presidential election with the former being the sole candidate, making mockery of sanctions waiver for the Latin American country on the promise to holding free and fair elections. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">If the oil prices keep rising in the coming months on account of the rising demand - judging by the recent crude stock draws - it will be a major political issue for the incumbent at the White House, in addition to a few other major issues to be addressed.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">His rival, President Trump, has made it clear about his position when it comes to the US energy policy - 'Drill baby drill'. While referring to what he calls, 'the black gold under American's own feet', President Trump want to tap into the vast US reserves as never before to bring down the oil prices.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">Since the possibility of President Biden doing a full 'U' turn on cutting down on green house gases is very low, he will be compelled to give diplomacy yet another chance in order to find ways to boost the global oil production. It will be a tough nut to crack, though. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><br /><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-23258361875175324892024-03-07T12:24:00.007+00:002024-03-07T12:39:34.854+00:00Test Your Knowledge of the Oil & Gas Industry : take our 10-minute interactive quiz!<h2>The Quiz: Multiple Choice Questions</h2>
<p style="border-bottom: 5px solid red; color: maroon; text-align: center;">Time: 10 minutes</p>
<p style="color: olive; text-align: right;">- Created by Crude Oil Futures -</p>
<p>This quiz covers significant milestones, key players, and evolving challenges in the oil and gas industry.<br /> It delves into historical developments, technological advancements, and contemporary issues impacting the sector. <br />Whether you're a seasoned professional or just starting your journey in the oil and gas world, this quiz is an opportunity to test your knowledge and stay informed about the dynamic landscape of this vital industry.</p>
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgrjqcIeGo1RWhB0N7Zay3BhIGXu0F7OZ91qOZ8UtSCm1XgTZitvQHlaZ7nWI52zBmz0860IpUKLjRas-k3GyCN5Ml8j-pSPvnP6Cj54rEfJAAXA_euYavJaNDB4GzKKOt-S_m3inMerMUKT1-xA-SUdMcQcwzhbT5TFuBfAiO5wSbJkn2NHV2RxtvaCQ/s256/hotair-ballon.gif" style="margin-left: 1em; margin-right: 1em;"><img alt="vivaxsolutions.com - C#" border="0" data-original-height="256" data-original-width="250" id="hab" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgrjqcIeGo1RWhB0N7Zay3BhIGXu0F7OZ91qOZ8UtSCm1XgTZitvQHlaZ7nWI52zBmz0860IpUKLjRas-k3GyCN5Ml8j-pSPvnP6Cj54rEfJAAXA_euYavJaNDB4GzKKOt-S_m3inMerMUKT1-xA-SUdMcQcwzhbT5TFuBfAiO5wSbJkn2NHV2RxtvaCQ/s16000/hotair-ballon.gif" title="vivaxsolutions.com - C#" /></a></div><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><p style="color: olive; text-align: center;"><br /></p>
<p> </p>
<button id="strt">Start the Quiz</button>
<p> </p>
<div id="quiz"></div>
<button id="submit">Submit Quiz</button>
<div id="results"></div>
<style>
h2{color:red;text-shadow:grey 4px 3px 5px;text-align:center;}
#strt{display:block;margin-left:auto;margin-right:auto;border-radius:5px;border-bottom:5px solid black;opacity:0.6;}
@media only screen and (max-width: 600px) {
#hab{display:block;position:relative;left:-100px;transform:scale(0.3);animation:anm 15s ease-in-out infinite alternate;}
@keyframes anm{
0%{opacity:0;}
100%{transform:scale(0.8) translate(200px,30px);}
}
}
@media only screen and (min-width: 601px) {
#hab{display:block;position:relative;left:-100px;transform:scale(0.3);animation:anm 15s ease-in-out infinite alternate;}
@keyframes anm{
0%{opacity:0;}
100%{transform:scale(0.8) translate(600px,30px) rotate(-30deg);}
}
}
body{
font-size: 20px;
font-family: sans-serif;
color: #333;
position:relative;
}
.question{
font-weight: 600;
}
.answers {
margin-bottom: 20px;
}
.answers label{
display: block;
}
#submit{
font-family: sans-serif;
font-size: 20px;
background-color: #279;
color: #fff;
border: 0px;
border-radius: 3px;
padding: 20px;
cursor: pointer;
margin-bottom: 20px;
border-radius:10px;
}
#submit:hover{
background-color: #38a;
}
//Resources
</style>
<script>
(function(){
function buildQuiz(){
// variable to store the HTML output
const output = [];
// for each question...
myQuestions.forEach(
(currentQuestion, questionNumber) => {
// variable to store the list of possible answers
const answers = [];
// and for each available answer...
for(letter in currentQuestion.answers){
// ...add an HTML radio button
answers.push(
`<label>
<input type="radio" name="question${questionNumber}" value="${letter}">
${letter} :
${currentQuestion.answers[letter]}
</label>`
);
}
// add this question and its answers to the output
var imgg, styl;
imgg=currentQuestion.url ?? null;
styl=currentQuestion.stl ?? null;
output.push(
`<h3>${currentQuestion.nmbr}</h3>
<img src="${imgg}" style="${styl}">
<div class="question"> ${currentQuestion.question} </div>
<div class="answers"> ${answers.join('')} </div>`
);
}
);
// finally combine our output list into one string of HTML and put it on the page
quizContainer.innerHTML = output.join('');
var x = document.querySelectorAll("input");
var i;
for (i = 0; i < x.length; i++) {
x[i].disabled = true;
}
}
function showResults(){
// gather answer containers from our quiz
const answerContainers = quizContainer.querySelectorAll('.answers');
// keep track of user's answers
let numCorrect = 0;
// for each question...
myQuestions.forEach( (currentQuestion, questionNumber) => {
// find selected answer
const answerContainer = answerContainers[questionNumber];
const selector = `input[name=question${questionNumber}]:checked`;
const userAnswer = (answerContainer.querySelector(selector) || {}).value;
// if answer is correct
if(userAnswer === currentQuestion.correctAnswer){
// add to the number of correct answers
numCorrect++;
// color the answers green
answerContainers[questionNumber].style.color = 'lightgreen';
answerContainers[questionNumber].style.fontWeight = 'bold';
}
// if answer is wrong or blank
else{
// color the answers red
answerContainers[questionNumber].style.color = 'red';
}
});
// show number of correct answers out of total
resultsContainer.innerHTML = `Your Score: ${numCorrect} out of ${myQuestions.length}`;
}
function starting(){
var sec=0;
var xx, min,i,signal=true;
var x = document.querySelectorAll("input");
startButton.style.position="fixed";
startButton.style.top=400+"px";
startButton.style.left=50+"%";
startButton.style.transform.translateX=-50+"%";
for (i = 0; i < x.length; i++) {
x[i].disabled = false;
}
function timing(){
sec+=1;
min = Math.floor(sec/60);
startButton.innerHTML= "Time: " + min + " : " + sec%60;
if(min>10){clearInterval(xx);
for (i = 0; i < x.length; i++) {
x[i].disabled = true;
//signal=false;
}
};
}
xx=setInterval(timing,1000);
}
const quizContainer = document.getElementById('quiz');
const resultsContainer = document.getElementById('results');
const submitButton = document.getElementById('submit');
const startButton=document.getElementById('strt');
const myQuestions =
[
{
"nmbr":1,
"url":"",
"stl":"display:none;",
"question":"What ancient civilization is credited with one of the earliest uses of crude oil, waterproofing their boats and baskets?",
"answers":{
"a":"Romans",
"b":"Babylonians",
"c":"Egyptians",
"d":"Persians."
},
"correctAnswer":"b"
},
{
"nmbr":2,
"url":"",
"stl":"display:none;",
"question":"The first commercial oil well was drilled in:",
"answers":{
"a":" Saudi Arabia",
"b":"China",
"c":"Pennsylvania - US",
"d":"Russia"
},
"correctAnswer":"c"
},
{
"nmbr":3,
"url":"",
"stl":"display:none;",
"question":"Who is credited with drilling the first commercial oil well?",
"answers":{
"a":"John D. Rockefeller",
"b":"Andrew Carnegi",
"c":"Thomas Edison",
"d":"Alfred Nobel"
},
"correctAnswer":"a"
},
{
"nmbr":4,
"url":"https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiP1rfN2TcVlYTMepedaIoCi6qeDpG27TW7sTN3CpFKPzN1OC2nYK52g2LFyS_xqwk8CB53ojySstSh3JW13k3rFEv9P24Jf5fItGnysdIm2eepOf1-vILW8Ky4cUiAkXmbZcsH8qjeFMs9rnfvk3W02-8GHROCR09uceTbml9np22RKp0Tc0XJeRMtuw8g/s1600/Nikola-Tesla---Wright-Brothers---Ignacy--ukasiewicz---Henry-Ford.jpg",
"stl":"display:block;margin:5px auto;",
"question":"The process of refining crude oil into usable products like gasoline was developed by:",
"answers":{
"a":"Ignacy Łukasiewicz",
"b":"Nikola Tesla",
"c":"Henry Ford",
"d":"The Wright Brothers"
},
"correctAnswer":"a"
},
{
"nmbr":5,
"url":"",
"stl":"display:none;",
"question":"Which of the following invention in the late 19th century significantly increased the demand for oil? ",
"answers":{
"a":"Light bulb",
"b":"Automobile",
"c":"Steam engine",
"d":"Printing press"
},
"correctAnswer":"b"
},
{
"nmbr":6,
"url":"",
"stl":"display:none;",
"question":"The Standard Oil Company, founded by John D. Rockefeller, became notorious for:",
"answers":{
"a":"For developing new drilling techniques",
"b":"Making hefty profits",
"c":"Being engaged in monopolistic buisness practices",
"d":"Pioneering the use of pipelines."
},
"correctAnswer":"c"
},
{
"nmbr":7,
"url":"",
"stl":"display:none;",
"question":"The discovery of oil in the Middle East in the early 20th century led to the formation of:",
"answers":{
"a":"OPEC",
"b":"OPEC+",
"c":"EU",
"d":"EEU"
},
"correctAnswer":"a"
},
{
"nmbr":8,
"url":"",
"stl":"display:none;",
"question":"The nationalization of oil resources by some Middle Eastern countries in the mid-20th century resulted in:",
"answers":{
"a":"Increased oil production for global markets",
"b":"Political tensions and conflicts",
"c":" A decrease in oil prices",
"d":"Widespread environmental damage across the region"
},
"correctAnswer":"b"
},
{
"nmbr":9,
"url":"iq3",
"stl":"display:none;",
"question":"The first major oil crisis, characterized by an oil embargo and price hikes, occurred in:",
"answers":{
"a":" The 1950s",
"b":" The 1970s",
"c":" The 1980s",
"d":" The 2000s"
},
"correctAnswer":"b"
},
{
"nmbr":10,
"url":"",
"stl":"display:none;",
"question":"The discovery of large oil reserves in the North Sea during the 20th century significantly impacted:",
"answers":{
"a":"The global dominance of the US oil industry",
"b":"The development of offshore drilling technology",
"c":" Both A and B",
"d":"Neither A nor B"
},
"correctAnswer":"c"
},
{
"nmbr":11,
"url":"",
"stl":"display:none;",
"question":"The environmental movement has increasingly raised concerns about the impact of the oil and gas industry on:",
"answers":{
"a":"Global warming and climate change",
"b":"Air and water pollution",
"c":" Loss of biodiversity and habitat destruction",
"d":"All of the above"
},
"correctAnswer":"d"
},
{
"nmbr":12,
"url":"https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgEyqok2kCwx_XCyH3bJX47h27lxu2l6YSTcqWk-RCbOlHFd63o4L3GnyLImDAH_UdkvKsMyNJy24j2xTW6i05LJ_P6QQJqBbjlqHNbFvSYx4Uzf0OyCf1274WFRdlUPdBUto36AcwJTzI_d27LkF-8BxRCSB-7PZv0VEV6HpcAWYfnrPNy0yg3Z5RbgyON/s1600/renewable.jpg",
"stl":"display:block;margin:5px auto;",
"question":"The development of alternative energy sources like solar and wind power is seen as a potential solution to:",
"answers":{
"a":"Reducing dependence on fossil fuels",
"b":"Mitigating environmental damage from oil and gas production",
"c":" Both A and B",
"d":" Neither A nor B"
},
"correctAnswer":"c"
},
{
"nmbr":13,
"url":"",
"stl":"display:none;",
"question":"The hydraulic fracturing technique, also known as fracking, has become controversial due to its potential impact on:",
"answers":{
"a":" Groundwater contamination",
"b":"Induced earthquakes",
"c":" Air pollution",
"d":"All of the above"
},
"correctAnswer":"d"
},
{
"nmbr":14,
"url":"",
"stl":"display:none;",
"question":"The ongoing debate on the future of the oil and gas industry revolves around issues of:",
"answers":{
"a":"Energy security and geopolitical implications",
"b":"Economic sustainability and transition to renewable energy",
"c":"Environmental responsibility and climate change mitigation",
"d":"All of the above"
},
"correctAnswer":"d"
},
{
"nmbr":15,
"url":"",
"stl":"display:none;",
"question":"The concept of a 'peak oil' scenario suggests:",
"answers":{
"a":"Global oil reserves are infinite and will never deplete",
"b":"Oil production will eventually reach a maximum point and then decline",
"c":"New technological advancements will allow for limitless oil extraction",
"d":"The price of oil will continue to decrease indefinitely"
},
"correctAnswer":"b"
},
{
"nmbr":16,
"url":"",
"stl":"display:none;",
"question":"The Paris Agreement, an international treaty on climate change, aims to achieve:",
"answers":{
"a":"A complete phase-out of fossil fuels by a specific date",
"b":"A significant reduction in greenhouse gas emissions to limit global warming",
"c":"Increased investment in developing countries' energy infrastructure",
"d":"All of the above"
},
"correctAnswer":"b"
},
{
"nmbr":17,
"url":"https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhyhU7Dw0Yxt-j-Zn2oTkr3Bb80Q5IxcuVeJ38aRTc3mDsjiFuRkzdQO3mpJyHF12r1fv5Swx7YghHlmKTj7PEChylKU2u8ulcNQbeccYio6S93Qzd5JVKS9xJfkyP1jRNv1g3PRbdITSUFzMOsYCOX1gIdZ55fg1TejaVDFOUU5tJvFM8CKF44LV1pwe33/s1600/drilling.jpg",
"stl":"display:block;margin:5px auto;",
"question":"What technological advancement in the late 20th century revolutionized oil exploration and production, allowing access to previously unreachable reserves?",
"answers":{
"a":"Horizontal drilling",
"b":"Deepwater drilling",
"c":"Fracking (hydraulic fracturing)",
"d":"Seismic reflection "
},
"correctAnswer":"b"
},
{
"nmbr":18,
"url":"",
"stl":"display:none;",
"question":"The Organization of the Petroleum Exporting Countries (OPEC) was founded with the aim to:",
"answers":{
"a":"Secure fair oil prices for member countries",
"b":"Control global oil production levels",
"c":"Develop environmentally friendly oil extraction methods",
"d":"Promote international cooperation in the oil and gas industry"
},
"correctAnswer":"a"
},
{
"nmbr":19,
"url":"",
"stl":"display:none;",
"question":"'The Stone Age came to and end due to a lack of stones; the oil age will come to and end due not to a lack of oil,' is attributed to",
"answers":{
"a":"Prince Abdulazis bin Salman",
"b":"Sheikh Ahmed Yamani",
"c":"George Bush jr",
"d":"Sadaam Hussein"
},
"correctAnswer":"b"
},
{
"nmbr":20,
"url":"",
"stl":"display:none;",
"question":"The term 'shale oil' refers to:",
"answers":{
"a":"Oil extracted from unconventional sources, such as shale rock",
"b":"Oil originating from the decomposition of marine organisms",
"c":"Crude oil that has undergone the refining process",
"d":"A type of synthetic oil produced from renewable resources"
},
"correctAnswer":"a"
}
,
{
"nmbr":21,
"url":"",
"stl":"display:none;",
"question":"The development of electric vehicles (EVs) is seen as a major challenge to the:",
"answers":{
"a":"Coal industry",
"b":"Nuclear power industry",
"c":"Oil and gas industry",
"d":"Renewable energy sector"
},
"correctAnswer":"c"
},
{
"nmbr":22,
"url":"",
"stl":"display:none;",
"question":"The concept of 'carbon capture and storage (CCS)' aims to:",
"answers":{
"a":"Reduce carbon emissions from power plants and industrial facilities",
"b":" Increase the efficiency of oil refineries",
"c":"Mitigate the environmental impact of oil spills",
"d":"Develop new sources of renewable energy"
},
"correctAnswer":"a"
},
{
"nmbr":23,
"url":"",
"stl":"display:none;",
"question":"The International Energy Agency (IEA) plays a vital role in:",
"answers":{
"a":"Setting global oil production quotas",
"b":"Providing data and analysis on energy markets",
"c":"Promoting investment in renewable energy sources",
"d":"Regulating environmental practices in the oil and gas industry"
},
"correctAnswer":"b"
},
{
"nmbr":24,
"url":"",
"stl":"display:none;",
"question":"The ongoing conflict in Ukraine has highlighted the importance of:",
"answers":{
"a":"Energy independence for countries reliant on Russian oil and gas",
"b":"The need for diversifying energy sources to improve resilience",
"c":"Investing in renewable energy infrastructure for long-term security",
"d":" All of the above"
},
"correctAnswer":"d"
},
{
"nmbr":25,
"url":"",
"stl":"display:none;",
"question":"What is the term used to describe the process of transforming existing buildings and infrastructure to use less energy?",
"answers":{
"a":"Decarbonization",
"b":"Energy efficiency",
"c":"Sustainable development",
"d":"Renewable energy transition"
},
"correctAnswer":"b"
}
/*
,
{
"nmbr":26,
"url":"https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhYLbPkhLZgw-Y3T3bJTIFvBpgiW6iTS4zGaLDHw1i7teulkRxHS-iQsB1t8AF99ReNm_QR6fGDJDqDmmpjcrLrpQGwMquAxJm4rfc9SGP8PQKHUSgxQztGzNW_WrwgAkofFfZjJTtP9r_2jxAypk8-JQcE6AzC70kRY5Z0cn6rICl9SXcTt00DbBP3Lw/s320/three.PNG",
"stl":"display:block;",
"question":"The reading on the spring balance is, ",
"answers":{
"a":"0kg.",
"b":"30kg.",
"c":"15kg.",
"d":"30kg."
},
"correctAnswer":"c"
},
{
"nmbr":27,
"url":"",
"stl":"display:none;",
"question":"Passengers are not supposed to travel while standing on double-decker buses, in order to ",
"answers":{
"a":"keep the centre of mass as low as possible.",
"b":"keep as high as possible.",
"c":"keep it inside the upper deck.",
"d":"keep it at the front of the bus."
},
"correctAnswer":"a"
},
{
"nmbr":28,
"url":"",
"stl":"display:none;",
"question":"A pebble, when dropped into a well, it takes 4.25s to hear the flash. Assuming that g = 10ms<sup>-2</sup>, the speed of sound in the air is, ",
"answers":{
"a":"160 m/s.",
"b":"320 m/s.",
"c":"80 m/s.",
"d":"400 m/s."
},
"correctAnswer":"b"
},
{
"nmbr":29,
"url":"",
"stl":"display:none;",
"question":"Three forces, 12N each, act on a tiny object in order to keep it in equilibrium. Which statement is true?",
"answers":{
"a":"The angle between two adjacent forces is 90<sup>0</sup>.",
"b":"The angle between two adjacent forces is 120<sup>0</sup>.",
"c":"The angle between two adjacent forces is 60<sup>0</sup>.",
"d":"The angle between two adjacent forces is 60<sup>0</sup> or 120<sup>0</sup>."
},
"correctAnswer":"b"
},
{
"nmbr":30,
"url":"",
"stl":"display:none;",
"question":"A bucket is lowered into a well at a constant acceleration of 2 ms-2. After 10 seconds, a ball is dropped into the bucket from rest, while the latter was still in motion. How long will the ball take to fall into the bucket?",
"answers":{
"a":"20s.",
"b":"1.8s.",
"c":"5s.",
"d":"3.3s."
},
"correctAnswer":"d"
}
*/
]
;
// Kick things off
buildQuiz();
// Event listeners
submitButton.addEventListener('click', showResults);
startButton.addEventListener('click', starting);
})();
</script><br /><br />
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<div class="separator" style="clear:both;display:none;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiP1rfN2TcVlYTMepedaIoCi6qeDpG27TW7sTN3CpFKPzN1OC2nYK52g2LFyS_xqwk8CB53ojySstSh3JW13k3rFEv9P24Jf5fItGnysdIm2eepOf1-vILW8Ky4cUiAkXmbZcsH8qjeFMs9rnfvk3W02-8GHROCR09uceTbml9np22RKp0Tc0XJeRMtuw8g/s1600/Nikola-Tesla---Wright-Brothers---Ignacy--ukasiewicz---Henry-Ford.jpg" style="display: block; padding: 1em 0; text-align: center; "><img alt="" border="0" data-original-height="343" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiP1rfN2TcVlYTMepedaIoCi6qeDpG27TW7sTN3CpFKPzN1OC2nYK52g2LFyS_xqwk8CB53ojySstSh3JW13k3rFEv9P24Jf5fItGnysdIm2eepOf1-vILW8Ky4cUiAkXmbZcsH8qjeFMs9rnfvk3W02-8GHROCR09uceTbml9np22RKp0Tc0XJeRMtuw8g/s1600/Nikola-Tesla---Wright-Brothers---Ignacy--ukasiewicz---Henry-Ford.jpg"/></a></div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-39286106099368595032024-03-05T16:14:00.010+00:002024-03-05T18:51:53.402+00:00Oil Price: China's manufacturing activity shrinks, yet again in February<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjpt3My2ywyhz-sopqNDxVWxOWTOqH1TfArBKcaP2K3XzbghOoPVMaIZOy20euae9GuWUshKwMs85uTCLY7p_mhqB_Z7iQed_bKff7eJ8bIU3nqtLEoATOWNfZv1sNiWq1AaPt5OI9FCnOz4RvQwOeeLaZIGHBM5hAm8LDKWnCy02FCcUhf0dUaed6ST2I/s680/China's%20Manufacturing%20PMI%20vs%20Month.png" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="China's manufacturing PMI - February" border="0" data-original-height="436" data-original-width="680" height="410" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjpt3My2ywyhz-sopqNDxVWxOWTOqH1TfArBKcaP2K3XzbghOoPVMaIZOy20euae9GuWUshKwMs85uTCLY7p_mhqB_Z7iQed_bKff7eJ8bIU3nqtLEoATOWNfZv1sNiWq1AaPt5OI9FCnOz4RvQwOeeLaZIGHBM5hAm8LDKWnCy02FCcUhf0dUaed6ST2I/w640-h410/China's%20Manufacturing%20PMI%20vs%20Month.png" title="China's manufacturing PMI - February" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"></td></tr></tbody></table><div class="separator" style="clear: both; text-align: center;"><br /></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">China's purchasing manager's Index, PMI, a key metric that signals the health of the manufacturing sector in the world's second largest economy, fell slightly in February, despite scoring 0.2% rise in January relative to December, 2023.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As it remains below the threshold, 50%, since September, 2023, analysts are concerned about the latest official figures that show yet another contraction in the manufacturing activities.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">A strong PMI - above 50% - indicates a rise in the manufacturing activities, something that both analysts and investors are eager to see. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">Conversely, an index below the PMI, is an indication of contraction in the manufacturing sector that in turn puts pressure on the demand of oil and gas.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">At present, however, the expected value is below the threshold; it has been like that for months.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">In this context, a drop in the PMI by 0.1% may be statistically insignificant; the fact that it has been below 50% for an extended period of time, however, has the potential to cause significant anxiety among investors, because of the position of China as a global manufacturing powerhouse that relies on imports for most of its energy needs.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div>
<p style="text-align: center;">
<iframe frameborder="0" height="400" scrolling="no" src="https://data.worldbank.org/share/widget?contextual=default&end=2022&indicators=NY.GDP.MKTP.KD.ZG&locations=CN&start=1961&view=chart" width="600"></iframe>
</p><p style="text-align: left;"><span style="font-size: large;">The GDP growth, according to the World Bank, meanwhile, depicts a mixed picture: the GDP growth that has been falling in recent years, suddenly showed a spike in 2021, only to fall back in 2022; it's an indication that just after Covid-19 lockdowns, China recorded an impressive growth, although it was short-lived.</span></p><p style="text-align: left;"><span style="font-size: large;">The fact that oil prices remain static for a long period of time indicates how the investors take up the Chinese factor seriously, in addition to the interest rate hikes in the West and the change in crude oil stocks of the same bloc. </span></p><p style="text-align: left;"><span style="font-size: large;">A fall in the US crude stocks, for instance, used to push the oil prices up while implying an increased demand; not any more in a noticeable way.</span></p><p style="text-align: left;"><span style="font-size: large;">The frosty relations between the West and China, meanwhile, show no sign of abating. On the contrary, chasm in the trust appears to be widening that in turn helps neither.</span></p><p style="text-align: left;"><span style="font-size: large;">China may not buy oil from the traditional suppliers as much given its shrinking manufacturing activities. It, however, will not resist importing cheap oil from Russia, as it has underground and over-ground facilities for them to be stored. </span></p><p style="text-align: left;"><span style="font-size: large;">Moreover, China has its own SPR - Strategic Petroleum Reserve - exactly like the US does; its location and size, however, are state secrets and China is not in the habit of updating the crucial data to the world for obvious reasons.</span></p><p style="text-align: left;"><span style="font-size: large;">China, in the meantime, may be filling up the petroleum reserves with the cheap Russian oil as long as it can - and of course, getting away with it before being distinctly registered in the crosshairs of the West at some point in the future. </span></p><p style="text-align: left;"><span style="font-size: large;">By doing so, it may not buy oil as much as it used to do from its traditional buyers in the Middle East on account of the relatively higher prices - a serious cause for concern among the investors.</span></p><p style="text-align: left;"><span style="font-size: large;">As far as the crude oil prices are concerned, as of 16:00 GMT on 5 March, the prices of WTI, Brent and LNG, liquified natural gas, were at $78.48, $82.55 and $1.99 respectively.</span></p><p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiPBgFpiHMvf0QeFyu2b2nLyIg3z5qx9gYApwS5JhSRmnYiAYOWsSt53E6q_D_I1mhbNVVr5ExDn1oC0H09aK6aNP5VUXH_xshUqOglHoSFNoFlkki7gl7c_aJeumHOqNobojOigb-CS_kueYIDBRO7n_kC3Ao63rgjL7RN54V1XElRU8lLFfLILbRbuas/s558/crude-oil-price-march.gif" style="margin-left: auto; margin-right: auto;"><img alt="Oil prices in March 2024" border="0" data-original-height="273" data-original-width="558" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiPBgFpiHMvf0QeFyu2b2nLyIg3z5qx9gYApwS5JhSRmnYiAYOWsSt53E6q_D_I1mhbNVVr5ExDn1oC0H09aK6aNP5VUXH_xshUqOglHoSFNoFlkki7gl7c_aJeumHOqNobojOigb-CS_kueYIDBRO7n_kC3Ao63rgjL7RN54V1XElRU8lLFfLILbRbuas/s16000/crude-oil-price-march.gif" title="Oil prices in March 2024" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Chart & Data: www.oilfutures.co.uk</td></tr></tbody></table><br /><span style="font-size: large;"><br /></span><p></p><p style="text-align: left;"><span style="font-size: large;">When the data on the US crude oil stocks will be released by the EIA, the US Energy Information Administration, and the API, American Petroleum Institute, in the middle of this week, prices may fluctuate slightly more; they, however, will not remain that way for long - judging by the behaviour of charts in the recent months. </span></p><p style="text-align: left;"><span style="font-size: large;">All in all, it makes perfect sense to go by what the EIA has forecast for this year and the next year, when it comes to the global demand of energy. The price of oil will follow a similar path unless a seismic change, political or otherwise, alters the status quo. </span></p><p style="text-align: left;"><br /></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-24782297871981276022024-03-02T12:17:00.066+00:002024-03-02T17:53:11.972+00:00Thinking outside the box: the tips for the OPEC+ from an anxious observer! <script src="https://cdn.jsdelivr.net/npm/chart.js@2.9.3/dist/Chart.min.js">
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<p style="text-align: center;"> </p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSiO8o7-X2cinx5ZmXRb-FLZWEgNnutstBQVas8rkdITFMh-8He2hxvDN-Stt7X9yndEzPbkjqzRYYjrv_dbl7owMnGOtMpBcNxnswTbqW3gDDQH4QlaSTyTTurT-J06ybNx4tVrBtwHoN7wHqlWCvGAriNTlCRdOZeiwIzcVV21SiBVrtlgV5xFvyzfI/s600/opec-underground.png" style="margin-left: 1em; margin-right: 1em;"><img alt="OPEC+ dilemma - 2024" border="0" data-original-height="450" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgSiO8o7-X2cinx5ZmXRb-FLZWEgNnutstBQVas8rkdITFMh-8He2hxvDN-Stt7X9yndEzPbkjqzRYYjrv_dbl7owMnGOtMpBcNxnswTbqW3gDDQH4QlaSTyTTurT-J06ybNx4tVrBtwHoN7wHqlWCvGAriNTlCRdOZeiwIzcVV21SiBVrtlgV5xFvyzfI/s16000/opec-underground.png" title="OPEC+ dilemma - 2024" /></a></div><div class="separator" style="clear: both; text-align: center;"><br /></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The price of crude oil shot up slightly at the beginning of this week, only to come down closer to where it had been in the last few weeks. The price of LNG, liquified natural gas, meanwhile saw its biggest drop in its recent history.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As of 18:00 GMT on Friday, the prices of two major benchmarks, WTI and Brent, were at $79.97 and $83.55 respectively; the price of LNG was at $1.84 .</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjxofmW0Hkm3wkfWGn2ohYCuU0M1HGK0k-FelERLZ7ln86pJlNvIMikt9G59FZQjmmD8JFAhQFUWvhhlFFGT88cMcNp3hIfJZocU0h8l1jWJbscrP4BKxQ8kqFuNwI8FZhu_ifKNlAxuqct04FpQQ-ed042MPhBehWNMurfC2LLVfeMVHaTeqPrfQ8Dob4/s956/download.png" style="margin-left: 1em; margin-right: 1em;"><img alt="Weekly oil price - WTI" border="0" data-original-height="431" data-original-width="956" height="289" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjxofmW0Hkm3wkfWGn2ohYCuU0M1HGK0k-FelERLZ7ln86pJlNvIMikt9G59FZQjmmD8JFAhQFUWvhhlFFGT88cMcNp3hIfJZocU0h8l1jWJbscrP4BKxQ8kqFuNwI8FZhu_ifKNlAxuqct04FpQQ-ed042MPhBehWNMurfC2LLVfeMVHaTeqPrfQ8Dob4/w640-h289/download.png" title="Weekly oil price - WTI" width="640" /></a></div><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The speculation over yet another production cut, analysts believe, may be the cause of rise in oil price this week. It, however, fell down again as the weekend approached, implying the acute challenges faced in maintaining the sustainability; the crude stock build, reported by the EIA, US Energy Information Administration, may have put a damper on the upward trend too.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div>
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<p style="font-size: small; text-align: right;">Data Source: EIA - US Energy Information Administration</p>
<div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As far as the OPEC+ is concerned, they say that they stick to the voluntary production cuts announced on 30 November, 2023 - 2.2 million barrels a day; the cartel says that the measure is for supporting the stability and balance of the oil marking - a coded reference to looking after the group's own interest first.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The production cuts, judging by where the oil prices stay at present, did not shore up the prices; on the contrary, it led to causing some dissension among relatively poorer members of the organization, especially from Africa, as their oil revenues were hit.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">Angola, for instance, left the OPEC+ on 21 December, 2023, shortly after the last OPEC+ meeting, clearly being frustrated over production cuts: oil revenue accounts for 30% of its GDP and it goes without saying the potential economic cost in the event of a major production cut that the more powerful members were planning to impose upon the African nation in the name of voluntary cuts</span><span style="font-size: x-large;">. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: x-large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">It, indeed, dealt a significant blow to the OPEC+ that used to put on a brave, united front, concealing fissures. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The yawning gap between those who are in favour of increased production cuts and those who oppose it, has since widened and so has that of the successive meetings of the OPEC+. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The sudden rise in oil price this week, in this context, is more of an anomaly than a reliable spike prompted by a substantiated catalyst. In short, the production cuts, voluntary or not, failed to shore up the dwindling oil prices and the ball is now in the cartel's courts to coming up with a constructive strategy - deviating from the well-hackneyed path.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">They can borrow a leaf out of the book of former President Mohamad Nasheed of the Maldives: he held a cabinet meeting underwater in order to highlight the plight of the inhabitants due to rising sea levels from the Global Warming. It did grab the attention of the global media as well as the decision making bodies at that time - a pretty successful PR stunt and a smart move. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">In these circumstances, if I were an influential member of the OPEC+, I would advocate a multi-pronged approach for dealing with the mounting challenges faced by the organization that has been in existence for over six decades: the approach falls into production management, collaborative effort and of course, transparency coupled with effective communication.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As for the production management, the OPEC+ needs to maintain flexibility rather than adopting rigid production cuts as the only way to boosting its own interests. Instead of following what members love to hear, they can make use of real time data and short-term forecasts - as opposed to long term forecasts - in order to make dynamic adjustments to its production strategy. Adaptability to changing global demands is neither a sign of weakness nor succumbing to the inevitable - far from it.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">In addition, the members can invest more on new technologies and enhance existing infrastructure in order to increase the efficiency of production whereby they can reduce the cost of production per barrel. Despite being fierce rivals, the OPEC+ can extract some inspiration from the shale oil producers of the US, who have been displaying the art of survival in the highly challenging circumstances. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">Moreover, there is no better time in exploring alternate revenue streams in inverse proportion to the contribution from the renewables, as the latter is not going to die down. Revenues earned this way would help the member nations to mitigate the impact on coffers, when the oil price drops and production cuts are imposed on them to counter it.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As for the collaborative effort, the more influential members can listen to the grievances of the poorer members and keep communication channels open while addressing the real concerns of the latter. That will enhance the cooperation within the OPEC+ that in turn helps the organization to move forward as a united front. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">In addition, the OPEC+ needs to be engaged with major consuming nations such as China, India, Japan and South Korea as they drive the global economy as a whole. The OPEC+ had a frosty relationships with them in the past, especially with India, over production cuts that damaged their economies. A regular dialogue with the countries in question leads to fostering a collaborative approach that will result in market stability.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As a further measure, the OPEC+ can get involved in the global security initiative to make sure there will not be disruptions to global energy supplies due to unforeseen socio-economic developments. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">As for transparency and communication, the OPEC+ clearly needs to communicate its production strategy - or that of cutting it - and the corresponding rationale effectively to the stakeholders, mainly its customer base. Unless the cartel broadens the the communication to the consumers at every level and the public, production cuts do more harm than good to the reputation of the organization for ignoring significant stakeholders in the game. Adding insult to injury, it can lead to unhelpful speculation and failure in curbing misinformation.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">All in all, the OPEC+ just cannot go with over-the-top long-term optimistic forecasts as there are clear signs that the demand is not going to see a steep rise, let alone an exponential growth. It clearly needs to adopt out of the box thinking as a matter of urgency. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">It reminds us of the prophetic words of a giant in the realm, who used to run the organization like a cult leader - Sheikh Ahmad Yamani of Saudi Arabia. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">"The stone age came to an end, not because of a lack of stones and oil age will come to an end, not because we have a lack of oil," said Sheikh Yamani to a British newspaper in an unprecedented interview in June, 2000. The OPEC+ needs to take heed of his prediction - seriously. </span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;"><br /></span></div><br /><p></p>
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</script></div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-51523566629638194512024-02-20T16:35:00.002+00:002024-02-20T16:40:51.996+00:00Iran's reluctance to escalate the Middle Eastern crisis and falling commodity prices<p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi9TPifo4jSHHPzng-ZbX2ym75nn8qV-SASDFN8TjqJkDXOafkZmJEm1tuc3vJpU4nImLGtltJgz_CrE93uTR8R6cQQLiZLPxJKE-_4BOkeRdvPPmJ33UDDFdY3d29d836PbPS-A1v4JhAftf1W2nXnvK7mxf7rNHExG0upj3ImISudSKiyO_eVKdAT88U/s600/oil-gas-prices-estimated.png" style="margin-left: auto; margin-right: auto;"><img alt="Estimated commodity prices" border="0" data-original-height="450" data-original-width="600" height="480" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi9TPifo4jSHHPzng-ZbX2ym75nn8qV-SASDFN8TjqJkDXOafkZmJEm1tuc3vJpU4nImLGtltJgz_CrE93uTR8R6cQQLiZLPxJKE-_4BOkeRdvPPmJ33UDDFdY3d29d836PbPS-A1v4JhAftf1W2nXnvK7mxf7rNHExG0upj3ImISudSKiyO_eVKdAT88U/w640-h480/oil-gas-prices-estimated.png" title="Estimated commodity prices" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Estimated Commodity Prices - Google </td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">With the war in the Middle East at a critical juncture, especially when it comes to the potential casualties of the beleaguered Palestinians near the Rafah crossing, bordering Egypt, Iran's desire to get involved in the conflict, if it had any before - apart from the Western estimates - appears to be on the wane.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although the shipping route in the Red Sea is still vulnerable to the intermittent attacks by the Houthis from Yemen, the crisis appears to be manageable, as far as imminent dangers to the selected ships are concerned. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">One of the obvious casualties in the Red Sea saga, apart from the shipping companies - and consumers worldwide, of course - has been Egypt: President Sisi of Egypt admitted today that his country lost between 40-50% of the revenue earned from the ships through the Suez Canal; many ships avoid the narrow waterway - and the Red Sea - not to risk the attacks by the Houthis; as the traffic plummeted so did the revenue for Egypt - when its own economy is in a dire state with its currency in freefall - losing its value by 24% just in 2024, according to Bloomberg.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Egypt neither took part in the so-called Coalition of the Willing nor complained about the potential revenue losses due to the turmoil in the Red Sea for political reasons; only today did it raise the issue of economic losses.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Perhaps the North African nation did not want to upset Iran by targeting the Houthis. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Iran, meanwhile, shows the signs of a well-calculated caution, having stuck to intense rhetoric for months to the contrary, in dealing with the war in the Gaza Strip; it is in no way a conciliatory move either. The theocratical regime of Iran is fully aware of its own domestic vulnerabilities in light of crippling Western sanctions that sow dissention among the young.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgNjbSev79eT4PE4GMhwJppxZhOKacvzCazxpAoB8t-qLhZSZUUx5AbsGGx3W29SWWgWo0IKzpRGCdykWpxaxqY4nLEv9HeFK_x4fZ9z6gXCBSntExIbqCJsYFVMrHxZwE__yX63E_A5DZBsiFTREAXTdzccUdHgdM21lXoiv5K2odCjRj_l0w98oVdm3o/s600/iran-theocracy.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img alt="Iran's theocracy" border="0" data-original-height="343" data-original-width="600" height="366" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgNjbSev79eT4PE4GMhwJppxZhOKacvzCazxpAoB8t-qLhZSZUUx5AbsGGx3W29SWWgWo0IKzpRGCdykWpxaxqY4nLEv9HeFK_x4fZ9z6gXCBSntExIbqCJsYFVMrHxZwE__yX63E_A5DZBsiFTREAXTdzccUdHgdM21lXoiv5K2odCjRj_l0w98oVdm3o/w640-h366/iran-theocracy.png" title="Iran's theocracy" width="640" /></a></div></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span style="font-size: large;">Iran, an arch enemy of Israel, issued a series of thinly-veiled threats against the Jewish state, defining its own 'redlines' for Israel not to cross, as the war broke out between Israel and Hamas. It, however, appeared to have realized the dangers in directly supporting some militants who operate in Iraq; Iran has been in denial over the direct involvement in the attacks on Israel on October 7, last year and of course, recent attacks on the US bases.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Arab media reports that a top general of the Iran's elite military force, IRGC-Quad force, in fact, visited Iraq shortly after the attack by the Iraq Shite militants on the US base that led to the death of three American soldiers. The reports further said that the general in question did ask the militant groups that Tehran has been supporting for years, not to attack the US and draw the blood of the US soldiers and face the wrath of the world's only Superpower - a bombing raid.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">It seems to have done the trick; the Iraqi front has been relatively quiet since the massive attack launched by the US on the militants, followed by a targeted assassination of the leader of the group that is responsible for the attack on the US forces, in Iraqi capital, Baghdad.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In short, Iran is not hell bent on escalating the crisis, despite being no friend of Israel and the US; some sections of the Western media had been depicting the polar opposite in the past few months without reliable evidence in supporting the claims.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In light of the latest developments, the dangers to shipping lines in the Red Sea may gradually die down as the Houthis feel the pinch due to the US bombardments, having already being rebranded as a terrorist outfit. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">If the status-quo remains this way, the price of crude oil may come down again and enter a static phase once again - the familiar territory that it found itself in before the war in the Gaza strip broke out.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The short-term energy outlook of the EIA, US Energy Information Administration, meanwhile, does not see a spike in oil prices in the foreseeable future either. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiWgOgJyvZKsMGi3S2LTYr6JLft_muyOHhKtuztb7FyQpdVGYF2GylC_XxMksao1g0ne3UZG8aIYsk4JhC8RFI51eP58jHvmBP1bwB43oYNy4Rzc21dmPRdQ-ApxBMHoQtBo1mI6grbjzkBbxbUcVqW9W0neQhXA00FM625C6Uc21LiqLceNh6iwWN29TU/s479/energy-outlook-2025.PNG" style="margin-left: 1em; margin-right: 1em;"><img alt="Short Term Energy Outlook - EIA" border="0" data-original-height="443" data-original-width="479" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiWgOgJyvZKsMGi3S2LTYr6JLft_muyOHhKtuztb7FyQpdVGYF2GylC_XxMksao1g0ne3UZG8aIYsk4JhC8RFI51eP58jHvmBP1bwB43oYNy4Rzc21dmPRdQ-ApxBMHoQtBo1mI6grbjzkBbxbUcVqW9W0neQhXA00FM625C6Uc21LiqLceNh6iwWN29TU/s16000/energy-outlook-2025.PNG" title="Short Term Energy Outlook - EIA" /></a></div><div class="separator" style="clear: both; text-align: center;"><br /></div><div class="separator" style="clear: both; text-align: left;"><span style="font-size: large;">The price of LNG, liquified natural gas, has, meanwhile, plummeted to record low - the worst in over three decades; with the cold season in the northern hemisphere coming to an end, the demand for the commodity is not to go up again until September this year. The net exporters such as Qatar may face difficult months ahead, if the fall in gas prices continues at this rate.</span></div></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The stagnation of the Western economies - and some being in recession - has been blamed on the inflation that in turn robbed the consumers of their spending power. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The West, in this context, has to take measures collectively to pass on the benefits of the falling commodity prices to the businesses and consumers, if spending apathy is the root cause of the recession.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">They cannot hold the oil producers in contempt for causing mayhem any more unless the governments make use of the tools at their disposal to ensure that the benefits of falling energy prices are distributed fairly down the energy pyramid. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"> </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"> </span></div><br /> <p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-50145403998677725442024-02-16T15:53:00.006+00:002024-02-16T16:16:33.969+00:00A Tale of Two Commodities: price of LNG falls and oil slightly up!<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEigz5zJb2PHnqIDCJZpz5_pko7e2v65KDsxxnzQ0epI6klposyEX6wZ_HdNXGHgCkBZ-hZEHY-wWuT_cc1DC6yIoec7J4uQM7KOiJdndVlhKV6QEHFnTPt14oJEWTLGoPYIo-hrA6cDsaf4XG3Q1AmOSxAtBhIzHSdeWh8qAARgOAhpMdjvQPAdp0jJmno/s531/oil-gas-prices-february.png" style="margin-left: auto; margin-right: auto;"><img alt="Prices of LNG and oil in February 2024" border="0" data-original-height="304" data-original-width="531" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEigz5zJb2PHnqIDCJZpz5_pko7e2v65KDsxxnzQ0epI6klposyEX6wZ_HdNXGHgCkBZ-hZEHY-wWuT_cc1DC6yIoec7J4uQM7KOiJdndVlhKV6QEHFnTPt14oJEWTLGoPYIo-hrA6cDsaf4XG3Q1AmOSxAtBhIzHSdeWh8qAARgOAhpMdjvQPAdp0jJmno/s16000/oil-gas-prices-february.png" title="Prices of LNG and oil in February 2024" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Prices of LNG and Oil on16 Feb 2024 </td></tr></tbody></table><span style="font-size: large;"><br /></span><div><span style="font-size: large;">As the feared 'R' word started doing rounds yesterday with Britain falling into recession, the energy markets have gone into shock-absorbing mode for obvious reasons; it goes without saying that the low manufacturing activity that inevitably stems from shrinking economic growth means less consumption in the main commodities such as oil and gas.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">Even before the official announcement by the British authorities about the country being in recession, the price of LNG, liquified natural gas, has been falling during the last two weeks.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The United Kingdom was officially declared being in recession in line with the text book definition of the latter: there were two successive negative growths in the GDP during the third and fourth quarters in 2023 respectively. </span></div><div><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjn8CoMvaa76uGIYm9EA-iCTmXLaiHx9SeW8sydRentIrcYwI1qUUhBk-ttxDWQTYMhT8XrIGQw8qxyop902nqOkveRKEl4IItcW9rgEnM6cyhDJg0gbJ7NQPXzXB_boRuJO-l5D0dZPj9E0omyelFyW-b9QHO5eZDDYa8prtu8R4i_3qAv3rEjxF4YeB0/s700/Figure%201_%20Real%20GDP%20is%20estimated%20to%20have%20fallen%20by%200.3%20in%20Quarter%203%20(July%20to%20Sept).png" style="margin-left: auto; margin-right: auto;"><img alt="UK GDP Growth" border="0" data-original-height="549" data-original-width="700" height="502" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjn8CoMvaa76uGIYm9EA-iCTmXLaiHx9SeW8sydRentIrcYwI1qUUhBk-ttxDWQTYMhT8XrIGQw8qxyop902nqOkveRKEl4IItcW9rgEnM6cyhDJg0gbJ7NQPXzXB_boRuJO-l5D0dZPj9E0omyelFyW-b9QHO5eZDDYa8prtu8R4i_3qAv3rEjxF4YeB0/w640-h502/Figure%201_%20Real%20GDP%20is%20estimated%20to%20have%20fallen%20by%200.3%20in%20Quarter%203%20(July%20to%20Sept).png" title="UK GDP Growth" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"></td></tr></tbody></table>Image Credit: Office for National Statistics - United Kingdom</div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">As of 14:00 GMT, the price of LNG was at $1.61, whereas the same was $2.35, a year ago. The price of oil, however, has slightly gone up in the past few days, despite the falling US crude oil stocks. As of 14:00 GMT, the prices of WTI and Brent, the two main benchmarks, were at $77.69 and $82.26 respectively. </span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The fact that Britain fell into recession grabbed headlines at a difficult time for the ruling Conservative Party, because there were two by-elections held on the same day; by coincidence, the Tories lost both seats to the opposition, Labour Party; the impact on the outcome by the disappointing economic news remains to be gauged by the political analysts.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The officials blamed the recession on less spending by the British public; the spending during the Christmas, for instance, according to officials, is much less than what they anticipated. </span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">It is clear that the inflation is partly to blame for the trend that is inextricably linked to the high energy prices. </span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The GDP growth in the Eurozone is not encouraging either; nor is that of Japan - all being the victims of high inflation.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">Although oil and gas prices have fallen recently, the drop in prices has not translated to price drop at pumps in exact proportion yet; neither has the falling gas prices.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The falling commodity prices are certainly good news for beleaguered customers. They, however, push the producers of the commodities into a state of uncertainty, when it comes to attracting investments; moreover, the coffers of the countries in question are going to feel the pinch, if the downward trend continues.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">Qatar, the world's largest exporter of LNG, for instance, will find it difficult to absorb shocks, as 70% of its revenues are from the sale of LNG; that means, both budgetary allocations and development plans will suffer in light of the developments in the sector. </span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The North Field project, for instance, that could potentially secure Qatar' s position as the world's leading LNG exporter may be in the unchartered waters, if the price of LNG keeps falling further in the international markets.</span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">Since the countries in the northern hemisphere are coming out of the cold winter season, there is no catalyst in the offing that could push the price of gas up, unless the price of oil goes up unexpectedly. </span></div><div><span style="font-size: large;"><br /></span></div><div><span style="font-size: large;">The crises in the Middle East and Ukraine have already lost its spark in firing up emotions of the cautions investors: an escalation of regional war seems to be unlikely despite the provocations by many actors in the Middle East; neither Iran nor Hezbollah of Lebanon appears to be in favour of an escalation.</span></div><div><br /></div><div><span style="font-size: large;">In yet another blow to the crude oil markets, the EIA, US Energy Information Administration, reported a significant build in the US crude oil stocks, implying the presence of enough barrels in the markets. </span></div><div><p style="text-align: center;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiqxXAaD5u9UAFleyG-0QxX-RQAwcRhWjaIOnQk4ChCISHWRC0eMrlbIm__Rf2Z-On3aclaTYA38zWRVgPM3kUfwGXK_Uk3mluupDhc9Punn4Qg4GngaQnMZvio9tmi0IMpjY2fEFfToiwr8GY6tBD28Ann8rPRITZKVcwYQDhxN3o9eThkPDpoHpGsp1A/s956/download.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="431" data-original-width="956" height="288" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiqxXAaD5u9UAFleyG-0QxX-RQAwcRhWjaIOnQk4ChCISHWRC0eMrlbIm__Rf2Z-On3aclaTYA38zWRVgPM3kUfwGXK_Uk3mluupDhc9Punn4Qg4GngaQnMZvio9tmi0IMpjY2fEFfToiwr8GY6tBD28Ann8rPRITZKVcwYQDhxN3o9eThkPDpoHpGsp1A/w640-h288/download.png" width="640" /></a></div><br /><p></p><p style="text-align: left;"><span style="font-size: large;">In this context, the price of oil may not see a steep growth, let alone an exponential growth. As a consequence, the price of LNG is very unlikely to go up in the near future. </span></p></div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-31566466743587257152024-02-04T22:35:00.006+00:002024-02-04T22:38:59.863+00:00The Shale Boom in the US<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiSBAyjx7Fn2-tXyejhGgo8yVuybj4nnQWeww0PH3LnBkxngrTq3z7qbo5t51DyIv-k2VkPaA08cVwlY2kG9DPrEXYULm_DW-Cm5fzOqRe8otGpb3Gi8t5sgjAIlS9cpzZACq2ElKd7I9vDlvflULtjWwtx0zEscZe8saVNtjuqZwaHgxl17iqyFilzVeI/s2688/US-shale-boom.jpeg" style="margin-left: auto; margin-right: auto;"><img alt="US shale boom" border="0" data-original-height="1536" data-original-width="2688" height="366" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiSBAyjx7Fn2-tXyejhGgo8yVuybj4nnQWeww0PH3LnBkxngrTq3z7qbo5t51DyIv-k2VkPaA08cVwlY2kG9DPrEXYULm_DW-Cm5fzOqRe8otGpb3Gi8t5sgjAIlS9cpzZACq2ElKd7I9vDlvflULtjWwtx0zEscZe8saVNtjuqZwaHgxl17iqyFilzVeI/w640-h366/US-shale-boom.jpeg" title="US shale boom" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">US Shale Boom</td></tr></tbody></table><br /><p style="text-align: left;"><span style="font-size: large;">The US shale boom has regained its lost momentum in the immediate aftermath of Covid-10 pandemic. </span></p><p style="text-align: left;"><span style="font-size: large;">According to the latest data, both Exxon Mobil and Chevron have reported strong financial results that has directly stemmed from the increased production; the production activities have increased in the Permian Basin in Texas, US. </span></p>
<p style="text-align: center;">
<iframe allowfullscreen="" height="600" loading="lazy" referrerpolicy="no-referrer-when-downgrade" src="https://www.google.com/maps/embed?pb=!1m18!1m12!1m3!1d55131715.41720991!2d-115.64014158540667!3d38.20013824398793!2m3!1f0!2f0!3f0!3m2!1i1024!2i768!4f13.1!3m3!1m2!1s0x86fc9b5065e980ab%3A0xcd97032071b6885e!2sPermian%20Basin!5e0!3m2!1sen!2suk!4v1707059475840!5m2!1sen!2suk" style="border: 0;" width="800"></iframe> </p><p style="text-align: left;"><span style="font-size: large;">The shale oil industry was dealt a massive blow in 2020, when the oil price - and the demand - crashed in the wake of once-in-a-century pandemic.</span></p><p style="text-align: left;"><span style="font-size: large;">The industry had been facing with its own challenges even before the pandemic broke out, due to higher production costs relative to those of the conventional oil producers. </span></p><p style="text-align: left;"><span style="font-size: large;">They were compelled to compensate for the high production costs by increasing the price of shale oil; the OPEC+, meanwhile, made the very survival of the sector even harder by artificially deflating the oil prices by increasing the production.</span></p><p style="text-align: left;"><span style="font-size: large;">During the booming years, </span><span style="font-size: large;"><span>meanwhile, </span><span>the industry accumulated significant debt in order to fund the new technologies</span><span> and drilling projects. The price crash in 2020 made it difficult for them to pay off loans, let alone attract more investments; hence uncertainty loomed over the entire industry; investors became reluctant to throw their money for new projects as the future seemed bleak.</span></span></p><p style="text-align: left;"><span style="font-size: large;">In the past three years, however, the technologies have improved with new innovations. The industry managed to increase the production to a level with an output around 9 million bpd - barrels per day; it is still below the values at the peak - 11 million bpd - in its heyday that in turn catapulted the United States to the position of the world's top oil producer - and by extension, a net exporter.</span></p>
<p style="text-align: left;"><a href="https://www.statista.com/statistics/183740/shale-gas-production-in-the-united-states-since-1999/" rel="nofollow"><img alt="Statistic: Shale gas and tight oil plays production in the United States from 2000 to 2050 (in trillion cubic feet) | Statista" src="https://www.statista.com/graphic/1/183740/shale-gas-production-in-the-united-states-since-1999.jpg" style="-ms-interpolation-mode: bicubic; height: auto; max-width: 1000px; width: 100%;" /></a></p><p style="text-align: center;"><span style="text-align: left;">Chart and Data: credit - </span><a href="https://www.statista.com" rel="nofollow" style="text-align: left;">Statista</a>
</p>
<p style="text-align: left;"><span style="font-size: large;">Not only did the shale boom bring down the energy prices, but also led to a growth in the economy in the shale oil producing regions, it increased the job opportunities in many sectors too. </span></p><p style="text-align: left;"><span style="font-size: large;">Shale oil and gas are extracted from underground rock formations by a process called, fracking or hydraulic fracturing. </span></p><p style="text-align: left;"><span style="font-size: large;">The main challenge faced by the drillers, when it comes to extracting oil and gas by fracking, as far as the environmental impact was concerned, was to stop the ground water from being contaminated during the process. </span></p><p style="text-align: left;"><span style="font-size: large;">There are significant number of people, both in the US and Europe who oppose fracking, because they think it can even trigger mini-earthquakes due to drilling activities deep down the Earth's crest.</span></p><p style="text-align: left;"><span style="font-size: large;">As for the ground water, fracking is usually taking place far below the ground water levels. The critics, however, still see the dangers.</span></p><p style="text-align: left;"><span style="font-size: large;">In Fracking, the drilling takes place in two forms: vertical and horizontal drilling. </span></p><p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj2mT8rcgZx8KFBaNlpkhVSI1CCPTOBXiaey0puu32C9skjMOPXWkt3EOed65IGpOVvQ38iHwLNmEqdrWHVwDQhIrORO4UllTjkJjS7R5JyN_6LzveHxm4tu9Bh1R9-Ta4H_x0UJ442LMj7gTGcnDD0dF45_tma-WSb6JVZ-TpM_f8DV526AyWm1RL-PZE/s600/shale-oil-and-gas-extraction.png" style="margin-left: auto; margin-right: auto;"><img alt="Fracking: shale oil an gas extraction" border="0" data-original-height="500" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj2mT8rcgZx8KFBaNlpkhVSI1CCPTOBXiaey0puu32C9skjMOPXWkt3EOed65IGpOVvQ38iHwLNmEqdrWHVwDQhIrORO4UllTjkJjS7R5JyN_6LzveHxm4tu9Bh1R9-Ta4H_x0UJ442LMj7gTGcnDD0dF45_tma-WSb6JVZ-TpM_f8DV526AyWm1RL-PZE/s16000/shale-oil-and-gas-extraction.png" title="Fracking: shale oil an gas extraction" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Fracking: shale oil an gas extraction</td></tr></tbody></table><br /><span style="font-size: large;"><br /></span><p></p><p style="text-align: left;"><span style="font-size: large;">The vertical drilling is carried out for miles underground up until the target rock formation is reached. The horizontal drilling is then carried out within the rock formations for thousands of meters to extract gas and oil by a complicated process, known as perforation.</span></p><p style="text-align: left;"><span style="font-size: large;">Steel drill pipes are inserted into those bore holes, both vertical and horizontal, while filling the gap between former and the ground soil with cement, whereby the casting can keep the contamination of ground water at bay. </span></p><p style="text-align: left;"><span style="font-size: large;">Once the systems are in place in the rock formations, shale oil and gas can be extracted for up to 40 years, according to the shale oil producers.</span></p>
<p><span style="font-size: large;">Of course, the booming shale oil sector is going to cause worries in the conventional oil sector in the coming months, OPEC+ in particular, especially at a time when the production cuts failed to shore up the prices; in short, when the shale industry extracts shale oil from the rock formations, the ripples in the industry push the OPEC+ to a place between the rock and the hard place in such a way that the latter finds a very little room for manoeuvre. </span></p><p><span style="font-size: large;">Analysts, in this context, attribute the sudden decision by Saudi Aramco, the world's largest oil company, a few days ago to halt the expansion of multi-billion-dollar expansion of oil facility, to the evolving realities on many fronts, including the shale boom in the US, something that the Middle Eastern producers may not have assumed to recover relatively fast.</span></p><p></p><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-32192129252135905822024-01-21T16:43:00.303+00:002024-01-31T00:48:12.752+00:00An imminent attack by the US on those who killed its troops - and associates<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhE-E1T60NDyfM8dsn0li_ST8fdAP4XH6oz-EykM7sKVyW5mxAtPz6K1txDkA0pwrD4-8NUNdQlcvhflVkue6RTTvHfS0h2DTrV9OojOQ-Q18Q3isYxYKdmsEX2-n4JP78ugUUK8FcdEi6d7ulMbUwtWasTUaEsnEqgIFcIQ_W1DatbBSiitvpsUo8O6ik/s600/B-52-bomber.png" style="margin-left: auto; margin-right: auto;"><img alt="B-52 bomber" border="0" data-original-height="341" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhE-E1T60NDyfM8dsn0li_ST8fdAP4XH6oz-EykM7sKVyW5mxAtPz6K1txDkA0pwrD4-8NUNdQlcvhflVkue6RTTvHfS0h2DTrV9OojOQ-Q18Q3isYxYKdmsEX2-n4JP78ugUUK8FcdEi6d7ulMbUwtWasTUaEsnEqgIFcIQ_W1DatbBSiitvpsUo8O6ik/s16000/B-52-bomber.png" title="B-52 bomber" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">B-52 Bomber</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">The US seems to have clearly decided to retaliate over the drone attack on its base in Jordan on Sunday that resulted in the death of three servicemen and injuries to many more. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">President Biden, in response to the questioning of the journalists on Tuesday, clearly indicated that he had already made up his mind as to what to do, without giving away anything for obvious reasons.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The absence of hubris and of course, the deafening silence on the part of the Americans is a classic case of '<i><b>the calm before the storm</b></i>'; in the aftermath of the attack, President Biden said he would respond in a '<b><i>time and manner of our choosing</i></b>', leaving it widely open to interpretation. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The developments in terms of the arrival of a fleet of the dreaded B-52 bombers, which are potentially armed with nuclear weapons and conventional bombs, in the Middle East, along with the other state-of-the-art aircrafts and those with refueling facilities clearly indicate, it is not just a matter of time, but a matter of space-time, before the anticipated attacks are launched, because the focus of the location/s remain to be guessed.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">On Tuesday, Israel added fuel to the fire of speculation: Israeli defense minister accounted for amassing troops along the northern border between Israel and Lebanon, as a preparation for '<i><b>what comes next</b></i>'. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Israel and Hezbollah, the Shia militant group from Lebanon, have been at an open for over three months since the war in the Gaza Strip broke out; they were mainly tit-for-tat attacks sans a major escalation. As far as Hezbollah that draws both material and moral support from Iran is concerned, the strategy is just to keep Israel engaged on its northern border in the hope that the Jewish state could be distracted from the war in Gaza.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">During that period, Hezbollah leader repeatedly implied his reluctance to get into a major confrontation with Israel that could potentially bring sheer destruction to the state of Lebanon, which is facing the worst economic crisis in its recent history.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The military build-up along the Israeli-Lebanese border indicates that Israel anticipates a serious flare-up in the event the of the US retaliation against its chosen targets. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Military analysts, in this context, anticipate that the US may target Iranian military assets directly over the drone attack on its troops in Jordan, defying the conventional wisdom of not going to war against Iran.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">There are already a significant number of US troops in the region, estimated to be closer to 50,000. The largest US military base is in Qatar. </span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj0bAd5eXdPxt5PdSsQHTTx5slceKhtiDHBsJPeVaJuzhMqDjw7mdFM3Jd720Z2xm0bdOqWgcC8_37cE3plAHdl2vluPCTFNuTEerHK193V7eMzYVAVPLZvivHkVAdOWYqKJxvhThl4fW1TM58Bow70Tg5SZ0CanJ6n6ahZAo3S6qwdQIJznEkhj4hLMzI/s594/US-troops-in-the-region.png" style="margin-left: 1em; margin-right: 1em;"><img alt="US troops in the Middle East" border="0" data-original-height="368" data-original-width="594" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj0bAd5eXdPxt5PdSsQHTTx5slceKhtiDHBsJPeVaJuzhMqDjw7mdFM3Jd720Z2xm0bdOqWgcC8_37cE3plAHdl2vluPCTFNuTEerHK193V7eMzYVAVPLZvivHkVAdOWYqKJxvhThl4fW1TM58Bow70Tg5SZ0CanJ6n6ahZAo3S6qwdQIJznEkhj4hLMzI/s16000/US-troops-in-the-region.png" title="US troops in the Middle East" /></a></div><br /><div style="text-align: left;"><span style="font-size: large;">In anticipating a serious response from the US, Iran kept denying that the Iraqi Shia group that launched the attack did not get orders from the latter. The military group in question, <b><i>Kateab Hezbollah</i></b>, in a separate development, on Tuesday declared that it would not launch any more attacks on the US troops in the region. </span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The US defense officials, meanwhile, said a military response is not going to be just one-off; they say there will be attacks on a sustained basis, implying the intention of taking on the Houthi rebels of Yemen directly as well.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Despite the ability of the US in launching attacks in a relatively short time while making use of its massive military assets in the region, there are still plenty of things at stake: the existing crisis in the Middle East could escalate in many directions with Iran being at the epicentre on military front; on the economic front, meanwhile, the movements of the containers ships in the Red will be subjected to more attacks and the shipping lines will certainly bear the brunt of the anger of those who come under fire that in turn could lead to high insurance premiums and of course, costs.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In short, the shipping lines will pass the rising costs on to the ordinary customers across the world and the inflation that recently showed some signs of being kept under control, will see the constrains melting away.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">As far as the Iranian theocratic regime is concerned, a direct confrontation is not in its interest, despite its funding for various Shia military groups. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In the event of such a major conflict with the US - and the West by extension - a significant '<i><b>unknown</b></i>' is looming over the Iranian government - the scale of patriotism, especially of the young, when the economic conditions are dire; it is something that cannot be taken for granted.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">History is awash with scenarios when autocrats miscalculated this factor. The Iranian government, more than any one else, is aware of this factor and may try to deescalate a major crisis at the eleventh hour.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">President Trump recently disclosed that the Iranians approached him through a go-between when General Soleimani, the top Iranian general, was assassinated on his orders in Iraq on January 3 in 2020. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although Iran launched missile strikes against a US base in Iraq, according to President Trump, he was informed about it hours before the launching and both he and the Iranians reached 'some understanding' about it! The US did not retaliate on that occasion!</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">There is no reasons to believe that a sudden turn of events of this kind, just belonged to history, not to the future.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div></div><div style="text-align: left;"><span style="font-size: large;"><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><br /><p></p>
Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-63871470193791318542024-01-20T23:58:00.011+00:002024-01-29T08:40:25.592+00:00Oil price rises as the events in the Middle East take a turn for the worse!<p style="text-align: center;"></p><div style="text-align: center;"><br /></div><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiY7YQldmUND5irs-PVtUSLN5_CQCiBDIVe_Hln6A3YcujoaITVJcpTKlRphQop3HJxZNayUqbbZT8-8W-BYQcKEgmPMIc9lAZ0rN-NAPM0NqJtU-I4KRpea5v-d_QAnZ6CGfyeMB3IncaSda7QwWyxqLBNJoTer2RzvZTH4NDbahZFR3HLtcOnBD_EqW4/s600/Military-drones.png" style="margin-left: auto; margin-right: auto;"><img alt="Kamikaze drone attack on the US troops" border="0" data-original-height="343" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiY7YQldmUND5irs-PVtUSLN5_CQCiBDIVe_Hln6A3YcujoaITVJcpTKlRphQop3HJxZNayUqbbZT8-8W-BYQcKEgmPMIc9lAZ0rN-NAPM0NqJtU-I4KRpea5v-d_QAnZ6CGfyeMB3IncaSda7QwWyxqLBNJoTer2RzvZTH4NDbahZFR3HLtcOnBD_EqW4/s16000/Military-drones.png" title="Kamikaze drone attack on the US troops" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Kamikaze drone attack on the US troops</td></tr></tbody></table><div style="text-align: center;"><br /></div><p></p><p><span style="font-size: large;">The conflict in the Middle East shows no sign of abating at present. The drone attack on an American military base on the Jordanian-Syrian border, by an Iran-funded Shia group from Iraq, is going to make things turn ugly in the next few days as the CENTCOM - United States Central Command - announced three American servicemen died and scores were injured on Saturday.</span></p><p><span style="font-size: large;">The Kamikaze drone, most probably produced in Iran, was a lucky hit. In Iraq they were brought down by the US Patriot missile system, when the US bases were under constant attack. The US, in retaliation, targeted the masterminds in Iraq and assassinated with the Predator drones in the past few months.</span></p><p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://upload.wikimedia.org/wikipedia/commons/7/7b/MQ-9_Reaper_ILA2016-3.jpg" style="margin-left: auto; margin-right: auto;"><img alt="US Predator drone" border="0" data-original-height="600" data-original-width="800" height="480" src="https://upload.wikimedia.org/wikipedia/commons/7/7b/MQ-9_Reaper_ILA2016-3.jpg" title="US Predator drone" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">US Predator drone: Image Credit - Wikimedia Commons</td></tr></tbody></table><span style="font-size: large;"><br /></span><p></p><p><span style="font-size: large;">The targeted killing of Shia militants on the Iraqi soil has already left the Iraqi government in a precarious position; it demanded that the US troops leave the country much sooner than they mutually agreed upon in principle years ago. </span></p><p><span style="font-size: large;">The US justifies its presence by highlighting the need of keeping the ISIS at bay. The Iraqi authorities, however, are sandwiched between the regional loyalty to Iran and its dependence on the US for military and other assistance.</span></p><p><span style="font-size: large;">On another front, the Houthis from Yemen, meanwhile, have been attacking the tankers and container ships of the US, UK and of course, Israel. Despite the bombing raids by the US and UK, the Houthis still target the ships that in turn has led to the spikes in insurance premiums and transport costs. The rising oil and gas prices clearly reflect the dangers and anxieties of the major shipping companies while sailing in the Red Sea.</span></p><p><span style="font-size: large;">As of 18:00 GMT on Friday, the price of WTI, Brent and LNG, liquified natural gas, stood at $78.01, $83.01 and $2.71 respectively; there was about 6% rise in price of oil on Friday.</span></p><p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhD_27GxdPRwm0JD8W1QMPDGtE2gW6f0hvBM1zlCrTTL3bzM1xm00R_4LbkSSmILD0uOVFXn0BKmnQKHjsL0ZIrzNjzxBHHR30qs5YEbwidnEaY5R0EjhmNr3NO2Mnxd2a3J9-TqxiAced1kfO5JpjFfPxabuw4OI5ALeI_I90EwO2wxR5rEJghRvOQNC0/s563/oil-price-friday.PNG" style="margin-left: auto; margin-right: auto;"><img alt="WTI and Brent price on Friday" border="0" data-original-height="289" data-original-width="563" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhD_27GxdPRwm0JD8W1QMPDGtE2gW6f0hvBM1zlCrTTL3bzM1xm00R_4LbkSSmILD0uOVFXn0BKmnQKHjsL0ZIrzNjzxBHHR30qs5YEbwidnEaY5R0EjhmNr3NO2Mnxd2a3J9-TqxiAced1kfO5JpjFfPxabuw4OI5ALeI_I90EwO2wxR5rEJghRvOQNC0/s16000/oil-price-friday.PNG" title="WTI and Brent price on Friday" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Oil price on Friday at 18:00 GMT: www.oilfutures.co.uk</td></tr></tbody></table><p></p><p><span style="font-size: large;">That means, when the markets open for business on Monday, the prices are going to go up again on account of the latest escalation involving the drone attack on the US base in Jordan.</span></p><p><span style="font-size: large;">Of course, the US will retaliate by targeting the militant group in Iraq, while driving yet another wedge between the US and Iraqi authorities. The responses of this nature, however, are not going to solve the problem even in the short-term, judging by the recent tit-for- tat attacks.</span></p><p><span style="font-size: large;">The price of crude oil and gas had been falling in the past few weeks and its positive impact could be seen on the economic front; the monthly inflation figures, based on the CPI - Consumer Price Index - showed a downward trend in the UK. If the rises in oil and gas prices are not contained, it will be back in the familiar territory in the post-Covid era and cause market mayhem again. </span></p><p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjbiRj6FHMsbZmuWaRg7icFWytwr-QbKkGyLhJhLZVpitjJesmaKP0h8p4xyRO72NKszDjjfG03nuIMBjocQqPV0fV2OMO00hjZHzu3Z-Mk3SDkToFoQJwZc05Y9R351vrI8U2JTLB2ySMPSMLwQN0gX7jV-8fZO6mi_F8pZpRZCkznWXqslgWnHoXZKqc/s548/rise-in-oil-prices.gif" style="margin-left: auto; margin-right: auto;"><img alt="Rising oil prices in January" border="0" data-original-height="381" data-original-width="548" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjbiRj6FHMsbZmuWaRg7icFWytwr-QbKkGyLhJhLZVpitjJesmaKP0h8p4xyRO72NKszDjjfG03nuIMBjocQqPV0fV2OMO00hjZHzu3Z-Mk3SDkToFoQJwZc05Y9R351vrI8U2JTLB2ySMPSMLwQN0gX7jV-8fZO6mi_F8pZpRZCkznWXqslgWnHoXZKqc/s16000/rise-in-oil-prices.gif" title="Rising oil prices in January" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Rise in oil prices: www.oilfutures.co.uk</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">In an election year, President Biden is left with a very little room for maneuver with the escalation of military threats in the Middle East: on one hand, he cannot appear to be weak in the eyes of his opponents, especially in the wake of surging poll numbers that are in favour of President Trump; on the other hand, he can't stretch out the tentacles of the US military arm to such an extent that will ultimately lead to a direct confrontation with Iran, outcome of which is just anyone's guess.</span></div><p></p><p><span style="font-size: large;">In another development, a British warship brought down a drone fired at a tanker by the Houthi rebels from Yemen on Sunday. The challenge, as far the Western military alliance is concerned is not about the vulnerability or ability to shoot the missiles and drones down; on the contrary, it is the sheer cost of firing these expensive missiles, each of which could potentially cost millions of dollars when the target in question may be worth a few thousands dollars - at most.</span></p><p><span style="font-size: large;">That means an understandable dilemma hovers over the military planners when it comes to keeping the aerial threats, both against their military assets and of course, commercial shipping, to a minimum, as they know elimination them completely is next to impossible in the context of the current geo-political developments. </span></p><p><span style="font-size: large;">The fact that the Western military alliance contemplate military options imply that the negotiations involving various diplomatic channels in addressing the issue have not produced any tangible solution to the problem. </span></p><p><span style="font-size: large;">It worries all the stakeholders, ranging from shipping companies to investors to their core, especially when there is not even a shadow of a solutions appearing on the horizon at present.</span></p><p><span style="font-size: large;"><br /></span></p><p><span style="font-size: large;"><br /></span></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-52366186690154780562024-01-10T23:34:00.000+00:002024-01-10T23:34:03.855+00:00Oil prices to remain static in 2024 - and beyond : EIA<p style="text-align: center;"> <table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrJw-wFZd_gkGhXo_7wWNDDKYtVkf3-wtmmmt0UqNWKppZsR2MzVXu8BQSnU5BIaEXxQD9HZJoizK_0_ZcNlFmCK9VOSn5erlYLEv8-uh9DAIYUh3K8qMMkHWwWR_3JoigG0Y3u6kGwfKCSV5JB0wskbAo_R1CxPmFJP6KpPyD1TfqTAD1ym8uPjIFeAQ/s680/oil-and-gas-prices-january.gif" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="Oil and gas prices - January, 2024" border="0" data-original-height="500" data-original-width="680" height="470" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrJw-wFZd_gkGhXo_7wWNDDKYtVkf3-wtmmmt0UqNWKppZsR2MzVXu8BQSnU5BIaEXxQD9HZJoizK_0_ZcNlFmCK9VOSn5erlYLEv8-uh9DAIYUh3K8qMMkHWwWR_3JoigG0Y3u6kGwfKCSV5JB0wskbAo_R1CxPmFJP6KpPyD1TfqTAD1ym8uPjIFeAQ/w640-h470/oil-and-gas-prices-january.gif" title="Oil and gas prices - January, 2024" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Oil and gas prices - January, 2024</td></tr></tbody></table></p><div style="text-align: left;"><br /></div><br /><p></p><p style="text-align: left;"><span style="font-size: large;">As the energy markets attempt to limping back to normal after a long period of holidays, the prices of commodity did not show any sign of revival. On the contrary, the prices of WTI, Brent and LNG, liquified natural gas, recorded losses by 3.4%, 2.99% and 0.075% respectively in the first week of the New Year.</span></p><p style="text-align: left;"><span style="font-size: large;">Despite the plummeting temperatures in Europe and America, the price of natural gas did not spike as anticipated during this week either. </span></p><p style="text-align: left;"><span style="font-size: large;">As the Europeans took timely precautions against harsh winter months, the fear of gas shortages has just disappeared into the thin air. Germany, for instance, managed to fill its reserves to an unprecedented 91%, according to media reports. </span></p><p style="text-align: left;"><span style="font-size: large;">Analysts believe that the downward pressure on the commodities come in the form of weakening global demand, increased US crude stocks, warmer-than-expected winter during the last three months in 2023 and of course, the tightening sanctions against Russian oil and gas by the European Union that in turn resulted in downward pressure being put on the crude oil price. </span></p><p style="text-align: left;"><span style="font-size: large;">The latest forecast by the EIA - US Energy Information Administration - clearly sums up the worst fears of the beleaguered traders, anxious investors and of course, producers. It says that the prices will remain static for the next two years!</span></p><p style="text-align: center;"><span style="font-size: large;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEj4TOy9FqD_8RFef1lUffELwWkCwEXVZErGNPrTUzhgI5A1hnJOAmlXp8VqXtyfJd7BZw2H32ZIZQzSIEhqWyZi_ZLsE4bTmGN04-jnWRymQCq32EehYiMrX2WyYP_07IBXs--eEDwlIsHFEkwGt-HgbkNrbuBOAYAAqTWAFzTfQsj6UrsjAicv0ZwaqHY" style="margin-left: auto; margin-right: auto;"><img alt="Oil demand in 2024-25: EIA" data-original-height="280" data-original-width="607" height="284" src="https://blogger.googleusercontent.com/img/a/AVvXsEj4TOy9FqD_8RFef1lUffELwWkCwEXVZErGNPrTUzhgI5A1hnJOAmlXp8VqXtyfJd7BZw2H32ZIZQzSIEhqWyZi_ZLsE4bTmGN04-jnWRymQCq32EehYiMrX2WyYP_07IBXs--eEDwlIsHFEkwGt-HgbkNrbuBOAYAAqTWAFzTfQsj6UrsjAicv0ZwaqHY=w615-h284" title="Oil demand in 2024-25: EIA" width="615" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Image Credit: EIA</td></tr></tbody></table></span></p><p style="text-align: left;"><span style="font-size: large;">The unexpected China's manufacturing contraction weighs down on the price of oil as well. China's Manufacturing PMI has been below the threshold since October last year, according to Chin's National Bureau of Statistics.</span></p><p style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg6qXjzANhY0wK4r-tkY_wcw-QHMpK_89pOFobityKk-th2mYVpBGvfRjyvZLtLOEcZLoqh4DYx5ExczI7vRzJGDyCNO_xYPoc-V-jp4qdl89tGYdhAQ-npoQnRh0VtpT37J_z1sox-ngg4EZhEpI-bYQZZoLmBv6_Vl-DB3xbMbLwuI_QOYBVzvF-UbeI/s600-rw/china-pmi-december.png" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="Chinese Manufacturing PMI" border="0" data-original-height="400" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg6qXjzANhY0wK4r-tkY_wcw-QHMpK_89pOFobityKk-th2mYVpBGvfRjyvZLtLOEcZLoqh4DYx5ExczI7vRzJGDyCNO_xYPoc-V-jp4qdl89tGYdhAQ-npoQnRh0VtpT37J_z1sox-ngg4EZhEpI-bYQZZoLmBv6_Vl-DB3xbMbLwuI_QOYBVzvF-UbeI/s16000/china-pmi-december.png" title="Chinese Manufacturing PMI" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Chinese Manufacturing PMI</td></tr></tbody></table><br /><span style="font-size: large;"><br /></span></p><p style="text-align: left;"><span style="font-size: large;">Since China is the world's biggest importer of crude oil, its falling demand has led to a surplus of crude oil in the markets. China could not shore up its manufacturing output despite the festive season in December, when the demand should have skyrocketed for Chinese made goods. It, however, has not happened with the continuation of the contraction. </span></p><p style="text-align: left;"><span style="font-size: large;">Although some factors that could potentially push the oil prices up have been still at play, the lower demand dampened the optimism of the traders and investors. </span></p><p style="text-align: left;"><span style="font-size: large;">The ongoing conflict in the Middle East and North Africa, for instance, was a perfect recipe for a steep increase in oil price; as the initial pandemonium, died down, the energy prices found the equilibrium quickly, defying the pundits in the sector. </span></p><p style="text-align: left;"><span style="font-size: large;">Even a relatively weaker US dollar could not excite the buyers despite oil and gas prices, most of the time, if not all, being denominated in dollars that in turn make it attractive to the buyers holding other currencies.</span></p><p style="text-align: left;"><span style="font-size: large;">In a surprise move, meanwhile, Saudi Arabia has cut the price of oil for all its customers, extending the New Year gesture beyond Asia. </span></p><p style="text-align: left;"><span style="font-size: large;">Saudis may have taken into account the new global realities while making the move: the oil production in the US has increased significantly along with Venezuela making a comeback to the markets; Angola's departure from the OPEC+ over its quota means it is in a position to determine the price in line with its own national interests, without being dictated by the more dominant players of the cartel.</span></p><p style="text-align: left;"><span style="font-size: large;">All in all, there are no signs of oil price hitting unsustainably higher values anytime soon. The over-the-top predictions of hitting it above $100 in the near future just stem from wishful thinking without an iota of evidence to justify it.</span></p><p style="text-align: left;"><span style="font-size: x-large;"> </span></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-76645909408674257412024-01-02T09:25:00.006+00:002024-01-06T17:28:31.327+00:00China's Manufacturing PMI down again in December: a weakened pulse reflecting decline in global energy demands!<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEixSR-Q57gOyJAc8PgNlkm7wqf9Ukh7rdbQVtynbQ2UQejj7A8bsX9XLWpfeCOEDNq8c0vG4j41QpYQwo3bHTWGc-lryd5-Gq8TLIsE_xldgY9UV-GycqgRxJDk6x3caRylDDGbL51I2r68F3wKV4J661IB1EO3DbOMEIox_eA6irLk0_DagZWFmdo5j2Q/s600/chian-slow-growth.jpg" style="margin-left: auto; margin-right: auto;"><img alt="Contraction in China's Manufacturing" border="0" data-original-height="597" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEixSR-Q57gOyJAc8PgNlkm7wqf9Ukh7rdbQVtynbQ2UQejj7A8bsX9XLWpfeCOEDNq8c0vG4j41QpYQwo3bHTWGc-lryd5-Gq8TLIsE_xldgY9UV-GycqgRxJDk6x3caRylDDGbL51I2r68F3wKV4J661IB1EO3DbOMEIox_eA6irLk0_DagZWFmdo5j2Q/s16000/chian-slow-growth.jpg" title="Contraction in China's Manufacturing" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Contraction in China's Manufacturing </td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">The latest data released by China's National Bureau of Statistics clearly shows that the the activities of the global manufacturing powers house, China, was down again in December, 2023.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In fact, it has lost 0.4% points, from 49.4% in November to 49% in December. The significant index has been on a downward trend since September.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The Manufacturing PMI of China is a barometer that represents China's manufacturing activity in a given month: the authorities survey the manufacturing managers in the vast country to gauge the activities at first hand; its threshold is 50% that indicates no changes; if it is above 50%, as happened in September, it is an expansion of the activity; on the other hand, any number below 50% is a contraction. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg6qXjzANhY0wK4r-tkY_wcw-QHMpK_89pOFobityKk-th2mYVpBGvfRjyvZLtLOEcZLoqh4DYx5ExczI7vRzJGDyCNO_xYPoc-V-jp4qdl89tGYdhAQ-npoQnRh0VtpT37J_z1sox-ngg4EZhEpI-bYQZZoLmBv6_Vl-DB3xbMbLwuI_QOYBVzvF-UbeI/s600/china-pmi-december.png" style="margin-left: auto; margin-right: auto;"><img alt="China's Manufacturing PMI for December" border="0" data-original-height="400" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg6qXjzANhY0wK4r-tkY_wcw-QHMpK_89pOFobityKk-th2mYVpBGvfRjyvZLtLOEcZLoqh4DYx5ExczI7vRzJGDyCNO_xYPoc-V-jp4qdl89tGYdhAQ-npoQnRh0VtpT37J_z1sox-ngg4EZhEpI-bYQZZoLmBv6_Vl-DB3xbMbLwuI_QOYBVzvF-UbeI/s16000/china-pmi-december.png" title="China's Manufacturing PMI for December" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">China's Manufacturing PMI for December</td></tr></tbody></table></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">With the latest data, China admitted explicitly that its manufacturing activity has contracted in the past four months. The admission has already cast a long shadow over the global energy sector, as the Chinese factories use up energy in all forms, perceived as good, bad and anything that falls in between, to power the vast network. while being the world's second largest consumer of fossil fuels. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Making matters more alarming, even in a busy month before the Christmas, there has not been a heightened manufacturing activity in China. when the goods are in heavy demand.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Therefore, not only does the seemingly simple metric indicate where the appetite of China stands on the scale of global energy consumption, but also provides the energy market watchers with valuable insights.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">When the PMI rises above the threshold, 50%, for instance, factories hum while production lines roll; as a result, China uses up vast amount of coal to run boilers, huge volumes of gas to produce electricity and millions of barrels of oil to run machinery while all rise in tandem.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">As an inevitable consequence, the energy consumption ripple through the energy markets that results in the rise in commodity prices and tightening of the supply. For instance, in 2021, the PMI surged and China's heightened activity led to a shortage of global coal supply that ended up causing an alarming surge in global energy prices.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">By contrast, the value of PMI below 50%, indicates a contraction in manufacturing activity and by extension, a slowing demand for fuels. The failure of oil prices to rise above $80 in a sustainable manner for the past few months, just shows the strongly-positive correlation of the two, despite the misplaced optimism of some producers who believe otherwise.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Investors were right, after all: they, at first, pinned their hopes on China's estimated manufacturing boom for months, only to get disappointed when things did not turn out as widely anticipated; fortunately, they did not throw caution to the wind, while losing vast sums of money; China's reluctance, meanwhile, to admit openly that it was the case hardly helped piercing the canopy of melancholy that looms over the energy markets at present.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Beyond the binary, however, the relationship between the China's PMI and the global energy demand may be a bit more complex; there is much more than meets the eye.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">A drop in demand for the cheaper goods from China's trading partners, for instance, can dampen the production despite the PMI remaining high. On the other hand, if factories manage to operate at low capacity to meet the sales obligations, it may not lead to a sharp rise in demand for energy. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Besides, China's tendency to embracing energy-efficient technologies may perhaps decouple the existing strong connection between its Manufacturing PMI and global energy demand, leaving it partially redundant in the years to come. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">China may even emulate the diminishing energy foot print of the lighter industries such as pharmaceuticals and electronics, while compelling energy-intense heavy industries such as steel and cement to follow suit. A shift of this kind will mitigate the impact on energy demand by the current, notoriously fluctuating PMI.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">All in all, at present, China's manufacturing activity, its genuine desire to energy transition and the healthy global demand for its goods remain the major factors that can change the not-so-distant horizon of the global energy landscape. An investor who navigates the complexities of the energy market while ignoring Chinese factor is like a Uber driver who lost his GPS before making the food delivery to a long-established hungry customer in his urgent need.</span></div><br /><p></p>Unknownnoreply@blogger.comDubai - United Arab Emirates25.2048493 55.270782825.204817713488914 50.87625155 25.204880886511084 59.66531405tag:blogger.com,1999:blog-1826246588600155044.post-74370231327431501082024-01-01T00:34:00.003+00:002024-01-01T01:27:48.732+00:00Happy New Year to the resilient and innovative oil and gas community!<style>
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<div style="background-image: url('https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEih86g0UqRHWiuebb9b5uzy3vID_qXympK7d8YglB4kS_1omnH0fOcDcY9uVVp7vY7kEg6vCAu4auFRtWzfOlRYg68EKBTJ-H0eOOoj4Ivk61jZ5evFnkaRNAGcg8Ju4TU3ubj881ntJjqySeh-dMRevXFEaEuRvPqAqQRQ-iuSk5N3ZzbjU3mDJmb9ZH8/s16000/fire.gif'); background-position: 50% 50%; background-repeat: no-repeat; background-size: center;">
<p style="text-align: center;"><span style="font-family: inherit; font-size: large;"> </span></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjQoxf9ae0ogtHhY_TtdXcbNkJRuVSR1T-ENpQ9RQpn3Ds7lUBXzz5_kIYR1h-y6DEle60JFo3K2zJcbgfTQ2VvzGf7w66MZqUpERlQ3QUBxsovs3VKKpW1uTLglUVbv635Jb-uZkQ3Z9iWMBR3-8hWq1W8WqZFSRq2o400ET5HTsncNY4h2QGn3pvEOBI/s561/happy-new-year.png" style="margin-left: auto; margin-right: auto;"><img alt="Oil and gas industry - Happy New Year" border="0" data-original-height="319" data-original-width="561" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjQoxf9ae0ogtHhY_TtdXcbNkJRuVSR1T-ENpQ9RQpn3Ds7lUBXzz5_kIYR1h-y6DEle60JFo3K2zJcbgfTQ2VvzGf7w66MZqUpERlQ3QUBxsovs3VKKpW1uTLglUVbv635Jb-uZkQ3Z9iWMBR3-8hWq1W8WqZFSRq2o400ET5HTsncNY4h2QGn3pvEOBI/s16000/happy-new-year.png" title="Oil and gas industry - Happy New Year" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Oil and gas industry - Happy New Year</td></tr></tbody></table><span style="font-family: inherit; font-size: large;"><br /></span><p></p><h2 data-sourcepos="1:1-1:90" style="background-color: white; color: #1f1f1f; font-weight: 500; line-height: 1.5rem; margin: 4px 0px;"><span style="font-family: inherit; font-size: large; white-space-collapse: preserve;">As the clock struck at midnight and we ushered in the fresh slate of 2024, it's a proud moment to raise a glass - or a hard hat, if safety's your calling! - to the remarkable community that keeps the world's engines humming: the oil and gas industry.</span></h2><p data-sourcepos="5:1-5:384" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Our warmest greetings go to the geologists, the drillers, the engineers, the pipeline tenders, the traders and even dowsers - who have helped in locating the oil and gas reserves, while being at the receiving end of ridicule for alleged practice of pseudoscience - who combine their tenacity, expertise, and unwavering dedication that bring warmth to homes, fuel transportation, and power countless industries under the Sun.</span></p><p data-sourcepos="5:1-5:384" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">The stakeholders defy the volatile markets, shifting landscapes, and evolving demands while adapting and innovating to ensure the energy flow neither falters nor evolves into a frightening uncertainty in the offing.</span></p><p data-sourcepos="7:1-7:386" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">The decade has been a whirlwind: geopolitical storms rocked the energy landscape, testing your resilience; when the march towards cleaner energy sources brought the challenges, you see an opportunities in your own sector while being at its very centre with the aura of a Confucianist. </span></p><p data-sourcepos="7:1-7:386" style="background-color: white; margin: 24px 0px; word-break: break-word;"><span style="font-size: large;"><span style="color: #1f1f1f;"><span style="white-space-collapse: preserve;">Early hurdles were dealt with the cutting-edge technologies, and an exploration of sustainable solutions, by proving time and again that the role of fossil fuels and environmental stewardship can co-exit. </span></span></span></p><p data-sourcepos="7:1-7:386" style="background-color: white; margin: 24px 0px; word-break: break-word;"><span style="font-size: large;"><span style="color: #1f1f1f;"><span style="white-space-collapse: preserve;">The dawn of 2024 may be a minefield of unknowns, yet the early signs are that it will be as dynamic as the year that we just passed. Since this industry was defined two centuries ago in a spirit of unparalled resolve and ingenuity, the ingredients are in its DNA to navigate the uncharted waters of a greener future.</span></span></span></p><p data-sourcepos="7:1-7:386" style="background-color: white; margin: 24px 0px; word-break: break-word;"><span style="color: #1f1f1f; font-family: inherit; font-size: large;"><span style="white-space-collapse: preserve;">Let's focus on the foundation on which we stand. Oil and gas will remain the backbone of global energy for years to come, and your expertise will be crucial in bridging the gap to a sustainable future with the concerns over the </span></span><span style="color: #1f1f1f; font-size: large;"><span style="white-space-collapse: preserve;">environment</span></span><span style="color: #1f1f1f; font-family: inherit; font-size: large;"><span style="white-space-collapse: preserve;"> at its very centre.</span></span></p><p data-sourcepos="7:1-7:386" style="background-color: white; margin: 24px 0px; word-break: break-word;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit;"><span style="white-space-collapse: preserve;">It is in everyone's interest to take the year ahead to collaborate, to harness new technologies, and to forge a path towards cleaner, more efficient ways of extracting and utilizing these valuable resources while minimizing the damage to the </span></span><span style="white-space-collapse: preserve;">environment</span><span style="font-family: inherit;"><span style="white-space-collapse: preserve;"> that we all cherish to protect.</span></span></span></p><p data-sourcepos="13:1-13:318" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">In this context , this New Year must be a time for celebration, for acknowledging the immense contributions of this remarkable community. It's a time for optimism, for looking ahead with the shared knowledge , because the industry in question will continue to be a driving force of progress, a silent partner in the world's daily rhythms that continuously resonate with the billions of inhabitants on the Blue Planet.</span></p><p data-sourcepos="15:1-15:319" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Let's spare a thought for the innovators, the pioneers, and the risk-takers who fuel our civilization. </span></p><p data-sourcepos="15:1-15:319" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Here's to the oil and gas family, strong as steel, resilient as rocks they take on, and ever-evolving like the earth itself. </span></p><p data-sourcepos="15:1-15:319" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">May 2024 be a year of countless achievements, shared triumphs, and a testament to the enduring spirit of this vital industry!</span></p><p data-sourcepos="17:1-17:63" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Cheers to you, and to the exciting journey punctuated by risks that lies before all of us!</span></p><p data-sourcepos="17:1-17:63" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEih86g0UqRHWiuebb9b5uzy3vID_qXympK7d8YglB4kS_1omnH0fOcDcY9uVVp7vY7kEg6vCAu4auFRtWzfOlRYg68EKBTJ-H0eOOoj4Ivk61jZ5evFnkaRNAGcg8Ju4TU3ubj881ntJjqySeh-dMRevXFEaEuRvPqAqQRQ-iuSk5N3ZzbjU3mDJmb9ZH8/s600/fire.gif" style="margin-left: auto; margin-right: auto;"><img border="0" data-original-height="400" data-original-width="600" id="imgg" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEih86g0UqRHWiuebb9b5uzy3vID_qXympK7d8YglB4kS_1omnH0fOcDcY9uVVp7vY7kEg6vCAu4auFRtWzfOlRYg68EKBTJ-H0eOOoj4Ivk61jZ5evFnkaRNAGcg8Ju4TU3ubj881ntJjqySeh-dMRevXFEaEuRvPqAqQRQ-iuSk5N3ZzbjU3mDJmb9ZH8/s16000/fire.gif" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"></td></tr></tbody></table><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><span style="font-family: inherit; font-size: large;"><br /></span><p></p><p data-sourcepos="17:1-17:63" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"></p><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><span style="font-family: inherit; font-size: large;"><br /></span><p></p><p></p><div class="separator" style="clear: both; text-align: center;"><span style="font-family: inherit; font-size: large;"><br /></span></div><br /><p></p>
</div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-59179110090579083812023-12-28T16:41:00.000+00:002023-12-28T16:41:00.299+00:00New Civil Transaction Law in Saudi Arabia: ties between the UAE and the Kingdom under scrutiny<p style="text-align: center;"><span style="background-color: white; color: #151515; letter-spacing: 0.2px;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrER61OJOoeHvSHyNgPRa1Hb-jwIiM2hnPTMP4qVR5alRrDcaINhKlgKhX6oZu5K7c2Ktxbv4BWDB2rBnbD1gyYHg5H_Mm8NP-MlbpI5hAInx9hiiH23xUOWqK96RbLjPonD1Le1wa_TKs3LWpf0_gP78reG297OwiHk9cYKjOiWN5E3nD4Kn2BfXSWxw/s600/ctl-saudi-arabia-uae.png" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="CTL - New construction regulations, Saudi Arabia" border="0" data-original-height="343" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrER61OJOoeHvSHyNgPRa1Hb-jwIiM2hnPTMP4qVR5alRrDcaINhKlgKhX6oZu5K7c2Ktxbv4BWDB2rBnbD1gyYHg5H_Mm8NP-MlbpI5hAInx9hiiH23xUOWqK96RbLjPonD1Le1wa_TKs3LWpf0_gP78reG297OwiHk9cYKjOiWN5E3nD4Kn2BfXSWxw/s16000/ctl-saudi-arabia-uae.png" title="CTL - New construction regulations, Saudi Arabia" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">CTL - New construction regulations, Saudi Arabia</td></tr></tbody></table><br /><span style="font-family: inherit; font-size: large;"><br /></span></span></p><p><span style="background-color: white; color: #151515; letter-spacing: 0.2px;"><span style="font-family: inherit; font-size: large;">The Saudi cabinet on Tuesday, according to Saudi Press Agency, SPA, approved the controversial contracting regulations for firms that are not based in the Kingdom. </span></span></p><p><span style="background-color: white; color: #151515; letter-spacing: 0.2px;"><span style="font-family: inherit; font-size: large;">The Kingdom has already set a deadline - January, 2024 - for the companies in question to move their regional headquarters to the Kingdom or risk losing lucrative contracts that are worth hundreds of billions of US dollars.</span></span></p><p><span style="background-color: white;"><span style="color: #151515; font-family: inherit; font-size: large;"><span style="letter-spacing: 0.2px;">The law, known as the CTL - Civil Transactions Law - covers both public and private contracts; some aspects had already set the alarm bells ringing in the business world, when it was first announced this year.</span></span></span></p><p><span style="background-color: white;"><span style="color: #151515; font-family: inherit; font-size: large;"><span style="letter-spacing: 0.2px;">When it comes to public projects, the CTL emphasizes the need of international firms having their regional headquarters in the Kingdom. If the firms already have their headquarters in Saudi Arabia, they comply with the law. The new international companies, however, may face challenges, when it comes to entering the lucrative Saudi construction sector.</span></span></span></p><p><span style="font-family: inherit; font-size: large;">As for the private projects, the CTL sets specifics for companies to comply with: the CTL encourages the participation of local firms and businesses. That means the international firms are encouraged to partner with the local firms in a constructive manner to benefit both sides. The Saudis say it is a way of promoting being competitive in the sector.</span></p><p><span style="font-family: inherit; font-size: large;">As for resolving disputes, the law encourages mediation and arbitration to complement the existing, traditional litigation that takes time to bring about solutions that affect both parties. </span></p><p><span style="font-family: inherit; font-size: large;">On a positive note, as far as foreign firms are concerned, the CTL takes steps to safeguard intellectual property - IP - of the firms; it throws a lifeline at technological firms when it comes to protecting their innovative technologies.</span></p><p><span style="font-family: inherit; font-size: large;">Both large firms with plenty of resources at their disposal and those are specialized in sectors with minimum local competition, will navigate the respective domains set up by the new law easier than the rest, unless provisions evolve over the time.</span></p><p><span style="font-family: inherit; font-size: large;">Political analysts are watching how the implementation of the new law will affect the relations between Saudi Arabia and the UAE that has a thriving construction sector. The emphasis on local content requirement may deprive the major UAE firms of accessing the expanding Saudi markets, unless a specific concession is made while taking into account the strategic and strong relations between the two countries.</span></p><p><span style="font-family: inherit; font-size: large;">Saudi Arabia, meanwhile, are promoting its tourism sector as well while emulating the success of Dubai, the jewel in the crown of the UAE as far as this particular sector is concerned. Although not being under imminent threat by the Saudi move, the development along with the new CTL will have enough ingredients, in reached a critical mass, to drive some form of wedge between the two nations. </span></p><p><span style="font-family: inherit; font-size: large;">As the relations between Iran and the two nations are on the mend, they no longer see a common enemy in Iran an immediate existential threat, especially when the ceasefire with the Houthis in Yemen still holds. </span></p><p><span style="font-size: large;"><span style="font-family: inherit;">The relations are still fragile, though: Iran's </span>continuous<span style="font-family: inherit;"> material support for the Houthis may not be welcome by both the UAE and Saudi Arabia, because up until a year ago, the latter were under attack by drones and missiles by the Houthis; in addition, the territorial dispute between Iran and the UAE about three islands in the Persian Gulf is still a bone of contention between the two regional heavyweights. </span></span></p><p style="text-align: center;"><span style="font-size: large;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgWFaZOcGvGUCTlSq7xIR987XUOLPYiypGSq8lns-1jRcvU6vqGyW1QGi0RCRPSKgG7DAZ7f8as4rI49a47fKhgk1ETRzYgE58GM4t0Y5i18SOe9-fn75dkf8QxyVDYcr_PtyGLaYKt5TK8hahmqFGhRnSxW1pVxiB8ja6do3ldZ_n6ABIIcYQA_JBj5A0/s663/three-islands.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="Three islands claimed by the UAE and Iran" border="0" data-original-height="361" data-original-width="663" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgWFaZOcGvGUCTlSq7xIR987XUOLPYiypGSq8lns-1jRcvU6vqGyW1QGi0RCRPSKgG7DAZ7f8as4rI49a47fKhgk1ETRzYgE58GM4t0Y5i18SOe9-fn75dkf8QxyVDYcr_PtyGLaYKt5TK8hahmqFGhRnSxW1pVxiB8ja6do3ldZ_n6ABIIcYQA_JBj5A0/s16000/three-islands.PNG" title="Three islands claimed by the UAE and Iran" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Three islands claimed by the UAE and Iran</td></tr></tbody></table><br /><span style="font-family: inherit;"><br /></span></span></p><p><span style="font-family: inherit; font-size: large;">A recent statement by Russia, a strong ally of Iran, in supporting the right of the UAE for claiming the islands in question drew a strong rebuke from Iran.</span></p><p><span style="font-size: large;"><span style="font-family: inherit;">If Iran accelerates enriching uranium to such an extent that Iran can produce a nuclear bomb, both countries will change their political affiliation in a matter of hours; Saudi Arabia has, time and again, said that if Iran </span>acquires<span style="font-family: inherit;"> nuclear weapons, they will do it too.</span></span></p><p><span style="font-size: large;"><span style="font-family: inherit;">In this context, the strong relations between the UAE and Saudi Arabia are mutually beneficial to both. The impact on that relations between the two countries with the </span>implementation<span style="font-family: inherit;"> of the CTL remains to be seen in the New Year. The strong trading links between the two countries, perhaps will offer a buffer to offset any mutually-harmful development, if it ever comes to that.</span></span></p><p><span style="font-family: inherit; font-size: large;">If it strains, by extension, it will affect the way they do business in the OPEC+ as well. With Angola's impending departure in January next year, the group cannot afford to let yet another fault line crisscrossing the 60-year old alliance.</span> </p><p><span style="font-family: inherit; font-size: large;"> </span></p><p><span style="font-family: inherit; font-size: large;"><br /></span></p><p><span style="background-color: white;"><span style="color: #151515; font-family: inherit; font-size: large;"><span style="letter-spacing: 0.2px;"><br /></span></span></span></p><p><br /></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-2433245065377837342023-12-24T19:20:00.653+00:002024-02-13T16:56:23.422+00:00Eagles above the Battlefield: The Netherlands Readies F-16s for Ukraine, amidst the Shadow of the S-400<style>
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</style><p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUkgCSrWAoViXuRHR8D6zCU7WJYlOsbd109QhHOBn6QHyzcSRFD5m3G1QRgstGah1x5rlZGK7N1YRDSg_51AK7NReOVw0UCVVE-wJiUbNKjp_CZvE3SFecRzh-Ls_vBmt6FcYSWIaAhnsVl48ZIQINzuKB2jJevPmxzy2jFwsWLY5Lyd6thqYeZiamhUA/s600/f-16-s-400.png" style="margin-left: auto; margin-right: auto;"><img alt="F-16 vs S-400" border="0" data-original-height="400" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUkgCSrWAoViXuRHR8D6zCU7WJYlOsbd109QhHOBn6QHyzcSRFD5m3G1QRgstGah1x5rlZGK7N1YRDSg_51AK7NReOVw0UCVVE-wJiUbNKjp_CZvE3SFecRzh-Ls_vBmt6FcYSWIaAhnsVl48ZIQINzuKB2jJevPmxzy2jFwsWLY5Lyd6thqYeZiamhUA/s16000/f-16-s-400.png" title="F-16 vs S-400" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">F-16 vs S-400</td></tr></tbody></table><br /><p style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: large; text-align: left; white-space-collapse: preserve;">The battlefront in Ukraine that lost the attention of the global media at the onset of the war between Israel and Hamas, suddenly grabbed the headlines once again, as the involvement of the US-made fighter jets does not seem to remain in the hypothetical realm any more.</span></p><p data-sourcepos="3:1-3:469" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">If the Dutch government is going to stick to its daring initiative, the skies above Ukraine - and Russia for that matter too - are poised for a potential showdown in the air, in the next few months.</span></p><p data-sourcepos="3:1-3:469" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">On December 22nd, the Dutch government headed by Mark Rutte, the acting prime minister, announced the bold move: the Dutch authorities want to deliver 18 F-16 Falcon fighter jets to the beleaguered Ukrainian government to defend its skies from relentless Russian attacks that take place in multiple forms - almost on daily basis.</span></p><p data-sourcepos="3:1-3:469" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Although the decision is yet to be finalized - and to be blessed by the US, the country of origin of the state-of-the-art fighter jets - it was a dramatic escalation in the Western military assistance. </span></p><p data-sourcepos="3:1-3:469" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">If F-16 are to be airborne in the Ukrainian skies, they will be the focus of the formidable Russian S-400 air defense system on the ground. The looming threat against the F-16 fighter jets from the latter and the attempts made by the former to wriggle out of risky domains are going to attract defense analysts to a new military theater in droves. </span></p><p data-sourcepos="3:1-3:469" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-size: large;">The heavy use of F-16s in the war against Hamas by the Israeli Defense Forces, IDF, elevated the fearsome reputation of the aircraft to new heights: the breathtakingly-potent versatility is certainly without a match; not only can she carry missile and bombs, but also can fire canons at aircrafts, ground targets and even radar installations.</span></p><p data-sourcepos="3:1-3:469" style="background-color: white; margin: 24px 0px; word-break: break-word;"><span style="background-color: transparent; white-space-collapse: preserve;"><span style="color: #1f1f1f; font-size: large;">Ukrainians have been demanding the F-16s since the early stages of the conflict, only to be turned down by the US, fearing a direct conflict between Russia and the NATO. With the latest encouraging news, the Ukrainians believe that they can tip the scales against their nemesis, Russia, by taking on their modern fighter jests, air defense systems and even missile launching sites.</span></span><span style="color: #1f1f1f; font-size: large; white-space-collapse: preserve;"> </span></p><p data-sourcepos="5:1-5:415" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-size: large;">Military analysts, however, believe it is easier said than done. They hold the view that Russia is not Hamas. As for the latter, there was no air defense system to speak of and the F-16s never faced a significant challenge from the ground. In addition, Israeli fighter pilots are well trained and their attention to detail is without a match; you hardly hear about an accident in the air involving Israeli fighter jets, perhaps as they are in the fighting mode throughout the year by default.</span></p><p data-sourcepos="7:1-7:461" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Russia's S-400 system, nicknamed "Triumf," stands sentinel, casting a long shadow over the air dominance anticipated with the arrival of F-16s. The fact that it has been acquired even by a major NATO member speaks for itself: Turkey bought the S-400 system, much to the irritation of major NATO members that in turn deprived the former acquiring F-35 stealth fighter jets from the US. </span></p><p data-sourcepos="7:1-7:461" style="background-color: white; margin: 24px 0px; word-break: break-word;"><span style="font-size: large;"><span style="color: #1f1f1f;"><span style="white-space-collapse: preserve;">In addition, in an ironic geo-political twist, both China and India have bought the system for their corresponding air defense tasks, while being literally at war for long months. Saudi Arabia and Qatar have shown an interest in acquiring them too, but stopped short of buying them as yet, not to annoy their ally, the US.</span></span></span></p><p data-sourcepos="7:1-7:461" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-size: large;">In this context, the Ukrainian theatre may become a potential market place for showing off rival weapons systems for prospective buyers, although there are undeniable risks for both stakeholders of the respective weapons.</span></p><p data-sourcepos="7:1-7:461" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Despite the S-400's bite, the potential benefits of the F-16s remain undeniable. According to independent analysts, they could provide much-needed air superiority, enabling Ukraine to more effectively counter Russian aerial assaults and support ground operations. This, in turn, could boost morale and potentially even shift the momentum of the war, pushing Russia to reconsider its objectives. An outright victory, however, they believe is way off.</span></p><p data-sourcepos="11:1-11:431" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">The path to Ukrainian skies for these F-16s, however, remains riddled with numerous obstacles. Beyond export permits and pilot training, the S-400 adds another layer of complexity that needs to be overcome to take the move beyond the aspiration stage: suppressing or evading its detection and engagement capabilities will be crucial for the F-16s' survival and effectiveness; techniques like electronic warfare, low-altitude flight paths, and coordinated attacks are some form of counter measures that could be used to mitigate the threats to the fighter jets in questions - and their reputation.</span></p><p data-sourcepos="13:1-13:357" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Ultimately, the decision to provide F-16s is a gamble, perhaps the last one that could bring about a watershed moment, if the plans by the NATO come to fruition exactly as envisioned. The NATO has to balance the potential gains against the risk of escalation to a point of no-return.</span></p><p data-sourcepos="13:1-13:357" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">Russia has repeatedly warned against supplying offensive weapons to Ukraine, threatening severe consequences. Engaging in a high-stakes aerial cat-and-mouse game with the S-400 adds another layer of tension to an already volatile situation.</span></p><p data-sourcepos="13:1-13:357" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">When the idea of deployment of F-16s was first discussed in the corridors of power of the NATO, President Putin famously said that Russia would find a way around to counter them, without specifying what it is. He is also on record saying that Patriot air defense system, which has already been deployed in Ukraine by the US, was 'too old' to be taken seriously by Russia. </span></p><p data-sourcepos="15:1-15:592" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">The defiant roar of F-16s over Ukraine amidst the S-400's watchful gaze, reminds everyone of the complex chessboard on which this conflict unfolds. The outcome of this aerial dance remains uncertain, but one thing is clear: the skies above Ukraine are about to become a theater of high-stakes drama, with the fate of nations hanging in the balance.</span></p><p data-sourcepos="15:1-15:592" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">As far as the year 2024 is concerned, there is not a single sign that implies the growing chasm between the US and Russia showing any reversal. </span></p>
<div style="text-align: center;"><br /></div><p data-sourcepos="15:1-15:592" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">With the screw of sanctions being tightened on regular basis, Russia could further weaponize the oil and gas supply by cutting down on the output with the blessings of the OPEC+ of which it is a major player - in retaliation. </span></p><p data-sourcepos="15:1-15:592" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"><span style="font-family: inherit; font-size: large;">In this context, President Putin's impromptu visit to the Middle East recently to the discuss the equation of oil supply and price, among few other things that have not been disclosed, may be a harbingers of bad news to come, as far as the energy markets are concerned. </span></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjTEyCiSVOocvNmoyEX4vbdWmwIUFx2X6ojaJozT4D_jrUrmaTLaBKzcISPr4bXnKh0qn8P4MRZNV73iX9j2owTwbFBRdF_SNQdAzFnJnTX0Hh6ZIx_-jghWslO6jKVdfa-wcbho6WsYJMA9E3H0q5rGwGJCmD7sKJH68LHx0PM3sqD2F-bd1yAg9fUYsk/s250/f-16-upscaled.png" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="250" data-original-width="250" height="250" id="fs" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjTEyCiSVOocvNmoyEX4vbdWmwIUFx2X6ojaJozT4D_jrUrmaTLaBKzcISPr4bXnKh0qn8P4MRZNV73iX9j2owTwbFBRdF_SNQdAzFnJnTX0Hh6ZIx_-jghWslO6jKVdfa-wcbho6WsYJMA9E3H0q5rGwGJCmD7sKJH68LHx0PM3sqD2F-bd1yAg9fUYsk/s1600/f-16-upscaled.png" width="250" /></a></div><br /><div class="separator" style="clear: both; text-align: left;"><br /></div><br /><div class="separator" style="clear: both; text-align: left;"><br /></div><br /><div class="separator" style="clear: both; text-align: left;"><br /></div><p></p><p data-sourcepos="15:1-15:592" style="background-color: white; color: #1f1f1f; margin: 24px 0px; white-space-collapse: preserve; word-break: break-word;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjk7aZL8ULCf_B2m97Cyg64n9enHu1GEEPYi7QO8Da0jXhdfvDDtj3TjSrkXkwbPcBYGP9Q_L4E440ySJL1g_kuiwDAa4BzJd64SWub3wrIjdctzERmsJHjjuPfBNA_a7U_PBw4s1Atp-zsk7WWKehzoTGpDEwD_wtfPUSfpw0zhg0KbDTGyadJoTbwNzQ/s600/es400.gif" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="381" data-original-width="600" id="sf" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjk7aZL8ULCf_B2m97Cyg64n9enHu1GEEPYi7QO8Da0jXhdfvDDtj3TjSrkXkwbPcBYGP9Q_L4E440ySJL1g_kuiwDAa4BzJd64SWub3wrIjdctzERmsJHjjuPfBNA_a7U_PBw4s1Atp-zsk7WWKehzoTGpDEwD_wtfPUSfpw0zhg0KbDTGyadJoTbwNzQ/s16000/es400.gif" /></a></div><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><div style="text-align: right;"><br /></div><span style="font-family: inherit; font-size: large;"><br /></span><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-81101032580261725552023-12-20T12:54:00.106+00:002023-12-20T21:42:22.837+00:00Tankers, Terror, and Tariffs: How Houthi Attacks are Squeezing the Global Economy<style>
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<p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgdsv1jNZpXGkQpV3k0fuazttlESjmwXOM_42mkCbgrpubmLqGeRfqWSQ06RP9lKhz8oHSqWnCmoHCBJWbv3qM_U5wERTKLx_IEut2I93kIHtn6JhDnVrABV5HceAxx69v7O8HFZKXejnLBMstev7GXmymIe-8V4wnkrDC9hcK6BtfO7INbESSJrW0qHHQ/s600/red-sea-attacks.png" style="margin-left: auto; margin-right: auto;"><img alt="Houthi attacks on ships in the Red Sea" border="0" data-original-height="343" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgdsv1jNZpXGkQpV3k0fuazttlESjmwXOM_42mkCbgrpubmLqGeRfqWSQ06RP9lKhz8oHSqWnCmoHCBJWbv3qM_U5wERTKLx_IEut2I93kIHtn6JhDnVrABV5HceAxx69v7O8HFZKXejnLBMstev7GXmymIe-8V4wnkrDC9hcK6BtfO7INbESSJrW0qHHQ/s16000/red-sea-attacks.png" title="Houthi attacks on ships in the Red Sea" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Houthi attacks on ships in the Red Sea</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">The rate of attacks on commercial ships in the Red Sea by the Houthi rebels in Yemen is increasing in proportion to the Israel firepower directed at Hamas in the Gaza Strip - to a crisis level.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><span style="font-family: inherit;">Judging by the warships that congregate in the region and the critical discussions that take place in the corridors of power in the West and their regional allies, the situation has clearly evolved into a military conflict on a second front, as far as the war in the Gaza Strip is concerned</span>.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">The recent spate of Houthi attacks that started on Israeli-linked ships at first, has since been extended on other commercial ships as well in the Red Sea; the development has sent shockwaves through the global shipping industry and raised concerns about a potential spike in oil prices. </span></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">This strategic waterway, responsible for roughly <b>10% of the world's seaborne</b> <b>oil trade</b> and <b>12% of global trade</b> overall, has become a precarious route due to the escalating conflict by the Houthi rebels in Yemen.</span></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div style="text-align: center;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The shipping disruption is serious:<span style="font-family: inherit;"> </span></span><span style="background-color: white; color: #1f1f1f;"><span style="font-family: inherit; font-size: large;">Major shipping lines like Maersk and Hapag-Lloyd have rerouted vessels around the Cape of Good Hope, adding thousands of miles and days to journey times. A detour of this kind translates to increased fuel costs, delays in deliveries, and higher shipping fees for consumers, when companies feel </span></span><span style="font-size: large;"><span style="background-color: white; color: #1f1f1f;">being squeezed on their</span><span style="background-color: white; color: #1f1f1f; font-family: inherit;"> margins at a challenging time for the global economy as a whole.</span></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: x-large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-eX6waw8srl2hD31cxuPzsVAKFYMs_on8QYx-LrPnrU_7wkJtwBVDVwVCBhjziPUTgDq16FU2-Rugtrrfp4-e89G5Fqv7m64163QkBOJemtrXm33XdYRjSRDjspXht6sS6UwnqtsTtg8aLAJuiozPavhMrj2xiR1Qb2nGd72TaGAuiijuJ4_mZbh2fKk/s600/red-sea-altered-shipping-routes.png" style="margin-left: auto; margin-right: auto;"><img alt="Costly detour bypassing the Red Sea" border="0" data-original-height="447" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-eX6waw8srl2hD31cxuPzsVAKFYMs_on8QYx-LrPnrU_7wkJtwBVDVwVCBhjziPUTgDq16FU2-Rugtrrfp4-e89G5Fqv7m64163QkBOJemtrXm33XdYRjSRDjspXht6sS6UwnqtsTtg8aLAJuiozPavhMrj2xiR1Qb2nGd72TaGAuiijuJ4_mZbh2fKk/s16000/red-sea-altered-shipping-routes.png" title="Costly detour bypassing the Red Sea" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"><span style="background-color: white;">Costly detour bypassing the Red Sea<br /><br /></span></td></tr></tbody></table></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: large;">It is not a silver bullet, though. The effect of weather patterns and seasonal oceanic currents, meanwhile, can further hamper the movement of the ships along the alternative route. </span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: large;"><br /></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: large;">A ship that sails from Europe to Sri Lanka, for instance, that usually takes 18-25 days, depending on the size and the speed of the ship, could potentially take up to 35 to 45 days, if it bypasses the Suez Canal, choosing a detour due to the prevailing risks.</span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: large;"><br /></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: large;">In certain situations, however, the choice of the alternative route has added benefits: the tolls across the Suez Canal can be very high and the relatively-narrow waterway is not for every single ship. The congestion and inevitable delays that arise from it, are known major issues as well.</span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #1f1f1f; font-family: inherit;">Ports along the alternative route around Africa, on the other hand, are experiencing increased traffic, leading to congestion and potential delays in cargo handling, as the countries in region are not usually prepared to handle an emergency of this nature. </span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #1f1f1f; font-family: inherit;"><br /></span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #1f1f1f; font-family: inherit;">The delays - and of course, increasing costs - further disrupts supply chains and adds to the financial burden on shippers that will ultimately pass it on to </span><span style="color: #1f1f1f;">beleaguered</span><span style="color: #1f1f1f; font-family: inherit;"> consumers across the globe.</span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #1f1f1f; font-family: inherit;"><br /></span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #1f1f1f; font-family: inherit;">Shipping companies, meanwhile, are dreading a spike in premium on risk on the insurance front. If the crisis continues without a solution in the offing, the increased insurance costs will factor into crude oil and LNG, liquified natural gas prices soon.</span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #1f1f1f; font-family: inherit;"><br /></span></span></span></div><div style="text-align: left;"><span style="color: #1f1f1f; font-size: large;"><span style="background-color: white;">With just five days to go before the Christmas, detours by some supply ships may result in delays before reaching the intended ports. China, a leading supplier of global products, perhaps sensing the calamity two months ago, had already deployed its warships in the region to safeguard its commercial interests. </span></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In order to counter the threats, the US has already deployed a few of its aircraft carriers and destroyers in the region; they have been active in shooting down drones and missiles launched by the Houthis since October. Britain already had deployed its own warships in the region too. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The US, meanwhile, has been instrumental in forming an international task force, <b>Operation Prosperity Guardian</b>, to deter the attacks by the Houthis on commercial ships and ensure safe passage for the ships. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The coalition include the US, Britain, France, Spain, Bahrain, Canada, Italy, the Netherlands, Norway and Seychelles. Some countries have already placed their military assets in the region and the palpable urgency have placed them under one umbrella for a collective response, in the event of the Houthis escalating the threats. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The participation of the UAE and Saudi Arabia, the two significant military powers in the Middle East, however, is far from clear yet; both had been under constant attacks by the Houthis up until a year ago - until a fragile peace process was agreed upon. Perhaps both countries do not want to derail the peace process with the Houthis that had been dragging for years along the Sunni-Shia divide.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The key players in the Middle East may be weary of the evolving stance of the US over the Houthis: the Biden Administration removed it from the designated terrorist list as one of its major policies at the outset, after taking over the White House; then the US removed its Patriotic missile batteries from Saudi Arabia - its only defense against the threat of explosive-laden drones from the Houthis for inexplicable reasons, forcing the old ally to borrow them from Greece; As the war in the Gaza Strip broke out, the Houthis threatened both Israel and its ally, the US, that resulted in the former being designated as a terrorist group - again.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">A few days ago, when British Petroleum, BP, declared that they would divert its ships along a longer route while bypassing the Red Sea citing the drone threats, the British government was compelled to act. Not only did it deploy HMS Diamond, a Type 45 destroyer of the Royal Navy, to the region, but also shot down a Houthi aerial asset, most probably a drone aimed at a ship. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Firing an expensive missiles that costs around $2 million a piece to take down a drone that just costs around a few thousand dollars, however, leads to the concerns about the inevitable economic viability of such operations; judging by the officials concerns expressed in private, they clearly hints this aspect of the Operation Prosperity Guardian, despite the encouragingly-soothing connotations of the code name chosen for the task. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The tension in the Gulf of Aden in particular and in the Middle East in general, is taking its toll on the price of commodities. The price of crude oil and LNG, liquified natural gas, which had been in decline for weeks, have shot up again, that in turn may affect the inflation once again, just as it shows signs of easing. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipzqVpiMhEmH0vVuZt_n3JtoQlexMHaTP7dF5qyu0-ujYzlySrERSlLuLo19njWP5M0g5EehZCZyZgOLIWtpnGDDdmfcCKoITAlTWIwIrr7Dt2rF7V2aWetY72GikBNUdGp9a0Uy1k8VCHBB405wl5-OgirkMzrmEhxpCE-LL5b6p0NMjNkDeEdvtopEs/s595/oil-and-gas-prices.png" style="margin-left: auto; margin-right: auto;"><img alt="Oil and gas prices" border="0" data-original-height="249" data-original-width="595" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEipzqVpiMhEmH0vVuZt_n3JtoQlexMHaTP7dF5qyu0-ujYzlySrERSlLuLo19njWP5M0g5EehZCZyZgOLIWtpnGDDdmfcCKoITAlTWIwIrr7Dt2rF7V2aWetY72GikBNUdGp9a0Uy1k8VCHBB405wl5-OgirkMzrmEhxpCE-LL5b6p0NMjNkDeEdvtopEs/s16000/oil-and-gas-prices.png" title="Oil and gas prices" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Oil and gas prices</td></tr></tbody></table><br /></div><div style="text-align: left;"><span style="font-size: large;">In the UK for instance, the fall in inflation, clearly attributed to the falling oil prices, may go into reverse mode once again, if the latter rise. </span><span style="text-align: center;"> </span></div><div style="text-align: left;"><span style="text-align: center;"><br /></span></div><div style="text-align: left;"><span style="text-align: center;"><span style="font-size: large;">In</span> <span style="font-size: large;">this context, the efforts to finding a diplomatic solution to the Gaza conflict are clearly underway. Israel's willingness to agree to a second pause in fighting may be a first step in this direction, although the Jewish state and Hamas are still at loggerheads over a range of major issues.</span></span></div><div style="text-align: left;"><span style="text-align: center;"><span style="font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="text-align: center;"><span style="font-size: large;">All the parties involved, directly or not, meanwhile, know the need of bringing back normalcy to the global trade and flow of oil across the vital artery for both. </span></span></div><div style="text-align: left;"><span style="text-align: center;"><span style="font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="text-align: center;"><span style="font-size: large;">In this context, the stakes cannot be higher for the West, Iran and its proxies in the region, unless they find common ground to easing the tension.</span></span></div><div style="text-align: left;"><span style="text-align: center;"><span style="font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="text-align: center;">
<div class="separator" style="clear: both; text-align: left;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjsfXWxrTXf2IX8JSsZeTW3M5nwkk9o0lpPYlvpOzkePDTkvdoZF6Z5oR5r_NAUSd1f956QsIfLhluvEjRoM0vAROezJ1i9aTZ6ehIVg5Ny3y56Dzr60faE1O6xxHDbqxxLH7shJ6J_RjBgD1xwai8canx3HnCVVheP_b8CCp50UxORXJOP-aeGfQ48os4/s190/drone.png" style="margin-left: 1em; margin-right: 1em;">
<img alt="drone" border="0" data-original-height="78" data-original-width="190" id="drone" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjsfXWxrTXf2IX8JSsZeTW3M5nwkk9o0lpPYlvpOzkePDTkvdoZF6Z5oR5r_NAUSd1f956QsIfLhluvEjRoM0vAROezJ1i9aTZ6ehIVg5Ny3y56Dzr60faE1O6xxHDbqxxLH7shJ6J_RjBgD1xwai8canx3HnCVVheP_b8CCp50UxORXJOP-aeGfQ48os4/s16000/drone.png" title="drone" /></a></div><div class="separator" style="clear: both; text-align: left;"><br /></div><div class="separator" style="clear: both; text-align: left;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg5mtoCW8aHitLOFB5muShr1ARQldrALGZA2hymFemtmmgxLiHTHh5OfLHIcpkVkAqYoZxnVGXjDzJ8UZ8tEN95UV9cWdVXimhyphenhyphen3PVFtk4wz4gDwPrKRAsjZwueow1QXPCDAJt3ykXl1y97JM3jlkDpYZeD4jVwsnU9Z-iris9FPoN59ekaUMorelnXwNw/s600/ship.png" style="margin-left: 1em; margin-right: 1em;">
<img border="0" data-original-height="456" data-original-width="600" id="ship" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg5mtoCW8aHitLOFB5muShr1ARQldrALGZA2hymFemtmmgxLiHTHh5OfLHIcpkVkAqYoZxnVGXjDzJ8UZ8tEN95UV9cWdVXimhyphenhyphen3PVFtk4wz4gDwPrKRAsjZwueow1QXPCDAJt3ykXl1y97JM3jlkDpYZeD4jVwsnU9Z-iris9FPoN59ekaUMorelnXwNw/s16000/ship.png" /></a></div><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><div class="separator" style="clear: both; text-align: left;"><br /></div><br /><span style="font-size: large;"><br /></span></span></div><p></p>
Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-81912738433361701502023-12-17T21:52:00.005+00:002023-12-18T17:58:48.857+00:00Japan to Hit Record-Low Petroleum Consumption in 2024: Refinery Closures and Aging Population Blamed<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgMbBt8CM5SEeoQkvGsw38w8rFOjCxPu1mxC7kj0BgPyw9xteiP2Zx2xVHZXdFx-k-RWZF-_p4RQRcDuu9oGfe-2yHE229inCLJGL7Dk93v2teL0Eq-Ua4WPBHL3D139fHjSxKYHux-I8zwvWpFEK-hYZVnEkmUoyz2PpYGJROVlel-8SNVY5H37sY3MgN2/s600/japanese-reinery-closures.png" style="margin-left: auto; margin-right: auto;"><img alt="Japanese refinery closures - 2024" border="0" data-original-height="343" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgMbBt8CM5SEeoQkvGsw38w8rFOjCxPu1mxC7kj0BgPyw9xteiP2Zx2xVHZXdFx-k-RWZF-_p4RQRcDuu9oGfe-2yHE229inCLJGL7Dk93v2teL0Eq-Ua4WPBHL3D139fHjSxKYHux-I8zwvWpFEK-hYZVnEkmUoyz2PpYGJROVlel-8SNVY5H37sY3MgN2/s16000/japanese-reinery-closures.png" title="Japanese refinery closures - 2024" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Japanese refinery closures - 2024</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">The beleaguered crude oil markets that look forward to catching a glimpse of hope in the coming New Year, was dealt yet another disastrous blow last week, when the EIA, US Energy Information Administration, announced the refinery closures in Japan, coupled with a serious decline in petroleum consumption.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Adding insult to the injury, the report, published on December 13, says that the petroleum consumption in 2024 would be the lowest on record since 1980s.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjC1Na0qufGR0H-JXP2-ifKH7PHHRxjPrp8anon4uRq1S2ktSOM_EtefVKhPxLM2JF3MHnO0MtLhK0gPm1taBTzUMp9dyDX4TL-zcz9oOf1Xl3VUVnRrrVnpUPif3J5HImpXA2ys_YRx_5ZDtHcI8yafhbQq2RIP0hPlqtOSpZcdlsA7TPCdnW6k_RNK6j6/s600/japanese-oil-consumption.PNG" style="margin-left: auto; margin-right: auto;"><img alt="Falling Japanese oil consumption - EIA" border="0" data-original-height="280" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjC1Na0qufGR0H-JXP2-ifKH7PHHRxjPrp8anon4uRq1S2ktSOM_EtefVKhPxLM2JF3MHnO0MtLhK0gPm1taBTzUMp9dyDX4TL-zcz9oOf1Xl3VUVnRrrVnpUPif3J5HImpXA2ys_YRx_5ZDtHcI8yafhbQq2RIP0hPlqtOSpZcdlsA7TPCdnW6k_RNK6j6/s16000/japanese-oil-consumption.PNG" title="Falling Japanese oil consumption - EIA" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Image: credit- the EIA</td></tr></tbody></table><div style="text-align: center;"><span style="font-size: large;"><br /><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The development will reverberate in the markets even before the dawn of the New Year, 2024, causing further volatility in the coming weeks. Since the next OPEC+ meeting is a long way off, a temporary boost, even if it could be short-lived, is not in the offing at present in these circumstances.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Citing the aging Japanese population that has long been in decline since 2009 as the primary cause, the EIA does not see any reversal of the trend in the near future. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">At present, more than 30% of its population are above the age of 65; the corresponding figures in the EU, US and China are 21%, 17% and 14% respectively.</span></div><br />
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<div style="text-align: center;"><iframe frameborder="0" height="400" scrolling="no" src="https://data.worldbank.org/share/widget?end=2022&indicators=SP.POP.65UP.TO.ZS&name_desc=false&start=1960&type=shaded&view=map&year=2022" width="600"></iframe></div><div style="text-align: center;"><br /></div><div style="text-align: left;"><span style="font-size: large;">The statistics are baffling, if not frightening, because, Japan is the fourth largest consumer of oil in the world: the petroleum consumption, for instance, fell from 5.2 million bpd in 1996 by 2% through 2022; in 2024, the EIA predicts that the consumption will fall by another 3%.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhq6NJhgWfpEVCg68DgyrW5HMz4m96Y9kxWnqVu2cdFS6TxKKtTt9U8xzTwPscc4oTmoYGeXg6H62-zV_Ea4HD6SVdVHm3jsubVC6f85fBaTKzP6BcNqiTV8BPxYQGaME-UL_J_RfkFOa-4TueiK2xO-_2wJgq1EAmCWZjN5dWchiqXvNJ3aHiEuKluhK6U/s600/Five-largest-consumers-of-oil.png" style="margin-left: auto; margin-right: auto;"><img alt="Top five consumers of oil in the world" border="0" data-original-height="441" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhq6NJhgWfpEVCg68DgyrW5HMz4m96Y9kxWnqVu2cdFS6TxKKtTt9U8xzTwPscc4oTmoYGeXg6H62-zV_Ea4HD6SVdVHm3jsubVC6f85fBaTKzP6BcNqiTV8BPxYQGaME-UL_J_RfkFOa-4TueiK2xO-_2wJgq1EAmCWZjN5dWchiqXvNJ3aHiEuKluhK6U/s16000/Five-largest-consumers-of-oil.png" title="Top five consumers of oil in the world" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Top five consumers of oil in the world</td></tr></tbody></table><br /><br /><div style="text-align: left;"><span style="font-size: large;">Japanese refineries fall into the category of low-complex refineries: they have been developed for processing light, sweet crude that is much more expensive than the cheaper crude that is heavy and sour; refineries in the rest of Asia, especially, those from India, South Korea and China, by contrast, favour the latter that in turn robs Japan of a level playing field.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">With the closure of a major refinery, ENEOS, in western Japan in October and another refinery being earmarked for closure in March, 2024, the loss of refinery capacity, according to the EIA, is estimated to be a staggering 7% of the total national capacity.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-family: inherit; font-size: large;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;">Japan,</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> a nation once heavily reliant on petroleum for its energy needs,</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> is at a crossroads</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> as far as its energy trends are concerned: a combination of factors,</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> including demographic changes,</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> economic shifts,</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> and the adoption of cleaner energy sources has pushed Japan into an unenviable position.</span></span></div><div style="text-align: left;"><span style="font-family: inherit; font-size: large;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><br /></span></span></div><div style="text-align: left;"><span style="color: #1f1f1f; font-size: large;"><span style="background-color: white; white-space-collapse: preserve;">As for the demographic changes, as the population ages, they tend to travel less that leads to the fall in petroleum consumption. In addition, they tend to be more energy-efficient in their chosen life-styles, further reducing the demand for fuels.</span></span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">Japanese economy, meanwhile, is rapidly evolving from heavy industry and manufacturing that it used to be, to a service-oriented economy, inadvertently handing down the former to its regional rivals; this trend accounts for the fall in demand for petroleum products such as diesel.</span></span></div><div style="text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="color: #1f1f1f; font-size: large;"><span style="background-color: white; white-space-collapse: preserve;">Japan has been a pioneer in adopting to cleaner energies, even before it became quite fashionable. In recent years, in order to meet the global goals, the country has invested heavily on wind, solar and even geothermal energy. These investments will inevitably reduce the reliance of fossil fuels in Japan even further.</span></span></div><div style="text-align: left;"><span style="color: #1f1f1f; font-size: large;"><span style="background-color: white; white-space-collapse: preserve;"><br /></span></span></div><div style="text-align: left;"><span style="color: #1f1f1f; font-size: large;"><span style="background-color: white; white-space-collapse: preserve;">There are risks, though. A heavy reliance on the renewables by a country that is prone to natural disasters, ranging from typhoons to tsunamis, means that Japan has to take steps to ensure the diversification is irreversible and will stand the test of time in proportion to the positive contribution it makes to improving the environment.</span></span></div></div><div style="text-align: center;"><br /></div>
<div style="text-align: center;"><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/V8__qrDCCsc?si=5FrQrKDJYdOMmusi" title="YouTube video player" width="560"></iframe></div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-5470977555649988482023-12-11T23:55:00.004+00:002023-12-11T23:58:02.784+00:00Sanctions against Russian fossil fuels: Russian revenues suffered recently!<p></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://energyandcleanair.org/wp/wp-content/uploads/2023/12/image-8-1024x640.png" style="margin-left: auto; margin-right: auto;"><span style="font-family: inherit;"><img border="0" data-original-height="500" data-original-width="800" height="400" src="https://energyandcleanair.org/wp/wp-content/uploads/2023/12/image-8-1024x640.png" width="640" /></span></a></td></tr><tr><td class="tr-caption" style="text-align: center;"><span style="font-family: inherit;">Source: CREA</span></td></tr></tbody></table><p></p><div class="separator" style="clear: both; text-align: center;"><span style="font-family: inherit;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit; font-size: large;">Despite the sanctions, Russia still exports fossil fuel to a significant group of countries that include some countries in the EU. Since exporting fossil fuels has been a cornerstone of its economy, the war in Ukraine and the subsequent sanctions imposed by the West have made an impact on its coffers - for obvious reasons.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit; font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit; font-size: large;">To make matters worse for Russia, the European Union imposed what it calls, phased-in ban on imports of Russia oil on December 5, 2023. With this move, Russian oil revenues were dealt a major blow, according to seasoned analysts.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit; font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit; font-size: large;">The sanctions have resulted in the inability of collecting revenue for its oil exports by Russia. In order to get round the challenge, Russia started selling oil at heavily discounted prices for India and China.</span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit; font-size: large;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit;"><span style="font-size: large;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;">The challenge, however, is far from over: according to estimates by the Center for Research on Energy and Clean Air (CREA),</span><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"> for instance, Russia's oil export revenues in October 2023 were down by 36% compared to October 2022</span></span><span face=""Google Sans", "Helvetica Neue", sans-serif" style="background-color: white; color: #1f1f1f; font-size: 16px; white-space-collapse: preserve;">.</span></span></div><div class="separator" style="clear: both; text-align: left;"><span face=""Google Sans", "Helvetica Neue", sans-serif" style="background-color: white; color: #1f1f1f; font-family: inherit; font-size: 16px; white-space-collapse: preserve;"><br /></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">The production cuts announced by Saudi Arabia and Russia in unison, must have played its corresponding role in losing the revenues for the latter. Saudi Arabia, meanwhile, has decided to cut the Arab light crude price for Asia by $3 in January, next year in order to keep the existing major customers in the region within the perimeter of loyalty.</span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">When Russia experienced revenue crunch, both India and China took the advantage by importing fossil fuels at an exponential rate: in the first half of 2023, India's imports of oil rose by 250%! China's import quota cannot be small either.</span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">The imports by India and China, however, have slowed down, according to the latest data. The Chinese imports, for instance, have fallen by 11% in November, compared to the very figure in October.</span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;">On Monday, meanwhile, Rameswar Teli, the Indian junior oil minster, announced that Indian refinery capacity will go up by 22% by 2028, indicating India's determination to import oil from where it can get it cheap. </span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="color: #1f1f1f; font-size: large;"><span style="background-color: white; font-family: inherit; white-space-collapse: preserve;">Hardeep Singh Puri, the Indian oil minister, has already been on record saying that India will buy from wherever it is available cheap, referring to the entry of Venezuela to fold. Both Russia and Saudi Arabia appear to be taking into account the worst-case-scenario.</span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white; color: #1f1f1f; white-space-collapse: preserve;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit; white-space-collapse: preserve;">As the renewable sector shows a significant growth in Europe, despite being inconsistent, Russia's market share will go further downhill in the foreseeable future, if the status quo in the war in Ukraine remains the same.</span></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit; white-space-collapse: preserve;"><br /></span></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit; white-space-collapse: preserve;">In this context, the apparent efforts made by President Putin to mitigate the crisis by visiting the two stalwarts OPEC+ is understandable. Mr Putin must have discussed the possibility of reducing the output by the member countries for stabilizing the crude oil markets.</span></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit; white-space-collapse: preserve;"><br /></span></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit; white-space-collapse: preserve;">As of Monday, the price of crude oil, meanwhile, remained in the realm of volatility, much to the frustration of the oil producers, as the estimated production cuts have lost steam in influencing the prices. </span></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="font-family: inherit; white-space-collapse: preserve;"><br /></span></span></span></div><div class="separator" style="clear: both; text-align: left;"><span style="font-family: inherit;"><span style="background-color: white;"><span style="color: #1f1f1f; font-size: large;"><span style="white-space-collapse: preserve;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEg7buCMyzF6DEag2f5-PUMlNWq_il4p1mUcfeIs1h_lUGcWamMEAINc6yXRLlX4OrxMblG_vzj_oTCzpvsH5vCEeUyY9VWSblZtDPSkB0uBK7BSMI3QaasIddxfRQm1zqqoHI7RTchgVP_IDzFiw0WSewZYZWnaugGGRmljPcwUW5Ps_Xc48h0wRjYFuIc" style="margin-left: auto; margin-right: auto;"><img alt="Oil price - hourly updates" data-original-height="314" data-original-width="548" src="https://blogger.googleusercontent.com/img/a/AVvXsEg7buCMyzF6DEag2f5-PUMlNWq_il4p1mUcfeIs1h_lUGcWamMEAINc6yXRLlX4OrxMblG_vzj_oTCzpvsH5vCEeUyY9VWSblZtDPSkB0uBK7BSMI3QaasIddxfRQm1zqqoHI7RTchgVP_IDzFiw0WSewZYZWnaugGGRmljPcwUW5Ps_Xc48h0wRjYFuIc=s16000" title="Oil price - hourly updates" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Oil price - hourly updates</td></tr></tbody></table>
Since the next meeting of the OPEC+ is scheduled to be in June, 2024, Russia and Saudi Arabia seem to have decided to act unilaterally, if the prices fall further, leaving gaping holes in their corresponding revenues. </span></span></span><span style="font-size: x-large;"> </span></span></div><p></p>
<div style="text-align: center;"><span style="font-family: inherit;"><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/0LU65wtZDlQ?si=cvSzVQaivl6G26K5" title="YouTube video player" width="560"></iframe></span></div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-76123960150765711262023-12-09T17:54:00.061+00:002023-12-10T12:08:55.282+00:00Slightly Bearish mood dominates the crude oil markets!<style>
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<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEinH5b1s9_zvhQEV9V-G3wrpnRuDyPlyabSRM1_8dWhm78c917yAcRi3-eMWnRwLYqjXNpfQUAAh95q_fD5PAx7GX0gEmu1xM43zJ81i9-_7XsVejigBmfvV8as0fV5l5n6nHbX7JFH-WNXK1ZRkx9a2aXq0iH_fG438fTf2PJjiKXuA2FI1doD66bHV_U/s600/bearish-mood-oilmarkets.png" style="margin-left: auto; margin-right: auto;"><img alt="Bearish mood in the crude oil markets" border="0" data-original-height="343" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEinH5b1s9_zvhQEV9V-G3wrpnRuDyPlyabSRM1_8dWhm78c917yAcRi3-eMWnRwLYqjXNpfQUAAh95q_fD5PAx7GX0gEmu1xM43zJ81i9-_7XsVejigBmfvV8as0fV5l5n6nHbX7JFH-WNXK1ZRkx9a2aXq0iH_fG438fTf2PJjiKXuA2FI1doD66bHV_U/s16000/bearish-mood-oilmarkets.png" title="Bearish mood in the crude oil markets" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Bearish mood in the crude oil markets</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">In proportion to the rate of optimism for a price rebound in the crude oil markets wearing thin, the hyperactivity of the stakeholders in the fossil fuel markets appears to be getting more and more intense by the day.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The seemingly-hastily-arranged state visit by President Putin of Russia to two major oil producers in the Middle East two days ago is a case in point. </span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Defying an international arrest warrant, Mr Putin arrived in the UAE and Saudi Arabia onboard Russia's own '<b><i>Air Force One</i></b>', escorted by a fleet of <b><i>SU-35S</i></b> fighter jets.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Among the general issues discussed, according to both Russian and the Middle Eastern sources, were the wars in the Gaza strip, Ukraine, Syria and Yemen; in addition, the need of a constructive, collective move by the OPEC+ to stabilize the oil markets has been a major topic for discussion too, according to those who keep an eye on the development in the region.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Mr Putin, who received a grand welcome in the UAE with a fly-past, looked extremely relaxed in both countries among the beaming hosts; the development may not have gone down very well in the corridors of power in the Western capitals, though.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The fact that the UN resolution, proposed by the UAE for a ceasefire in the Gaza Strip, was vetoed by the US on Friday, in this context, appears to be a way that the US showed its displeasure over the UAE cozying up to Mr Putin; the UAE said it was disappointed with the US move that seemed to be a clear snub.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Despite the production cuts announced by the OPEC+, the price of crude oil, meanwhile, continued to fall during the past week, recording a 7-week successive decline. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgDrLU2zAa-myDTV8DRdfR5_zaIszaWTTFN5xOaphQymXa4lbBe7mgXJUYRv9Dv9MSdhNU1bn3A-fau7auTh3PsEYfFTLxW7SaGALyG6e-6IcPMzfEA0h78r-lo4MHBJNqt7xvOM7HZs6ruwqLUWAuR543kWRdBlOajpBKLKqepHwAkypwWvS97h0GlcJg/s591/weekly-oil-price.PNG" style="margin-left: 1em; margin-right: 1em;"><img alt="Weekly oil price:www.oilfutures.co.uk" border="0" data-original-height="391" data-original-width="591" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgDrLU2zAa-myDTV8DRdfR5_zaIszaWTTFN5xOaphQymXa4lbBe7mgXJUYRv9Dv9MSdhNU1bn3A-fau7auTh3PsEYfFTLxW7SaGALyG6e-6IcPMzfEA0h78r-lo4MHBJNqt7xvOM7HZs6ruwqLUWAuR543kWRdBlOajpBKLKqepHwAkypwWvS97h0GlcJg/s16000/weekly-oil-price.PNG" title="Weekly oil price:www.oilfutures.co.uk" /></a></div>Weekly oil price:www.oilfutures.co.uk<br /><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Undoubtedly, the failure to boost the oil price by production cuts must have frustrated Saudi Arabia as the status quo is not sustainable as far as the world's top oil exporter is concerned; its break-even price is above $80, according to the estimates of the IMF.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In short, the unexpected development in the oil markets has placed the Kingdom between the rock and the hard place: production cuts generate less revenue, on one hand; on the other hand, by increasing the prices will force its longstanding, major customers to look elsewhere for cheaper alternatives; at present, Venezuela has been the focus of many major buyers in light of sanctions being temporarily lifted against its oil by the US.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><span style="font-family: inherit;">Venezuela</span>, meanwhile, has been attracting more than its usual share of attention, as it threatened its relatively small neighbour, <b><i>Guyana</i></b>, of just 800,000 inhabitants over a disputed oil field: the ownership of <span style="background-color: white;"><span style="font-family: inherit;">Guyana’s <b><i>Essequibo</i></b> region has been in dispute for decades and</span></span><span style="background-color: white; font-family: Georgia, Times, "Times New Roman", serif;"> the discovery of offshore oil fields that Guyana claims as its own territory has been the cause of the latest tension.</span></span></div><div style="text-align: left;"><span style="font-size: large;"><span style="background-color: white; font-family: Georgia, Times, "Times New Roman", serif;"><br /></span></span></div><div style="text-align: center;"><span style="font-size: large;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgulSqNbtu6FuScu6JewxGwTGCHJrIatIqJUsW735-Xzrt-mAY8LO7ARRd9JXK_zchElyyDK40y1IXdhowK2exBYsfxDKv7yD14v76pmO5wBjaG_O2EWArf5INiZuV7LKEtruTHuTlrrF7d6MWzSgJ96rZNFaBDWVWdkVuMoE_qiZKfu7nB5Rkv92kZf2A/s600/Essequibo.PNG" style="margin-left: auto; margin-right: auto;"><img alt="Essequibo region: Venezuela vs Guyana" border="0" data-original-height="415" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgulSqNbtu6FuScu6JewxGwTGCHJrIatIqJUsW735-Xzrt-mAY8LO7ARRd9JXK_zchElyyDK40y1IXdhowK2exBYsfxDKv7yD14v76pmO5wBjaG_O2EWArf5INiZuV7LKEtruTHuTlrrF7d6MWzSgJ96rZNFaBDWVWdkVuMoE_qiZKfu7nB5Rkv92kZf2A/s16000/Essequibo.PNG" title="Essequibo region: Venezuela vs Guyana" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"><b style="background-color: white; font-size: x-large; text-align: left;"><i>Essequibo region: Venezuela vs Guyana</i></b></td></tr></tbody></table><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Venezuela conducted a referendum recently whether to pass legislation to declare the ownership of the region as its own and the outcome is said be over 95% in favour of annexing the region.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Venezuela, however, has neither international mandate nor backing for such a drastic move. If it were to go down this route, disregarding both legality and international concerns, the US will be compelled to read the riot act against the Latin American country - once again.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Judging by President Maduro of Venezuela's determination to claim the territory by driving away existing investors in the Essequibo region, the dispute may evolve beyond the bluster that in turn could affect the supply side of crude oil. The US has made its position clear on the matter and so has the International Court of Justice - ICJ.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although the Venezuelan factor casts an extra canopy of worry over the energy markets, the existing worries show no sign of abating. The rampant inflation and the inevitable measures to counter it such as raising interest rates, for instance, has dampened the mood of the investors in the sector. It has the potential to further slow down the global economic growth that in turn affect the demand of oil.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The prevailing bearish sentiment is worrying the OPEC+ to the core and reaching an agreement over a sustainable level of production, in all probability, appears to be a major stumbling block. </span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The significant gap between the latest meeting and the one planned for the next year - June, 2024 - just reflects the potential difficulties faced by the members of the cartel, when it comes to determining the optimum production cut. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">It seems to be a yawning gap to be bridged as far as the OPEC+ is concerned. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"> </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"> </span></div><br /><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-18062961071272157982023-12-01T12:22:00.003+00:002023-12-01T12:42:00.728+00:00Oil prices: why the production cuts failed to do the magic - this time?<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjqXwwYvOcH5GjI2CZGghda-Ubga-q8GxA5cIIFCOlr57tWMFmb-COnX7U4TLm4q8Vi3-ry6iw-op088MMpffjE4SO34pHQfEVZ4gSkepBuXIhD46hVpqsiymdcNLGBEUjgYJxGn8At0XlEx-3mhOtbNJr76kmwoLTSQybHSduNjosVmNM6Tln1PcPhCQ8/s600/oil-production-cuts-by-opec-2024.png" style="margin-left: auto; margin-right: auto;"><img alt="Estimated oil production cuts in 2024 by country" border="0" data-original-height="440" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjqXwwYvOcH5GjI2CZGghda-Ubga-q8GxA5cIIFCOlr57tWMFmb-COnX7U4TLm4q8Vi3-ry6iw-op088MMpffjE4SO34pHQfEVZ4gSkepBuXIhD46hVpqsiymdcNLGBEUjgYJxGn8At0XlEx-3mhOtbNJr76kmwoLTSQybHSduNjosVmNM6Tln1PcPhCQ8/s16000/oil-production-cuts-by-opec-2024.png" title="Estimated oil production cuts in 2024 by country" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Estimated oil production cuts in 2024 by country</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">The OPEC+ meeting that took place yesterday, having been rescheduled for inexplicable reasons after four days, did not live up to the hype created by certain media about deepening production cuts. Nor did it achieve its intended goal, judging by the unusual market response in the aftermath of the meeting; the prices did not skyrocket this time!</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The price of oil in the international markets on Friday, on the contrary, continued its downward trend, instead. Then, there are misgivings about the official <a href="https://www.opec.org/opec_web/en/press_room/7267.htm" target="_blank">communique</a>, which at best, is vague in detail and at worst, leaves the analysists in a state of nausea, if they keep dissecting the material, phrase for phrase, in extracting the potential, exact numbers. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The markets expected additional cut of 1 million barrels; not only are the numbers announced far below that, but also voluntary; that means, the individual member of the OPEC+ has the freedom to choose - perhaps, not cutting any output at all. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">It's no secret that there had been disagreements over the production quotas for three African nations - Angola, Congo and Nigeria. They wanted to increase the production to earn more revenue in order to address their own, dire economic needs. It has been reported that Angola was deeply unhappy over its allocated quota.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Despite the productions cuts, voluntary or not, oil prices hardly moved in the opposite direction as hoped by the bigwigs of the OPEC+. </span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span style="font-size: large;">As of 11:25 GMT on Friday, the price of West Texas Intermediate, WTI and Brent, the international benchmark, were trading at $76.29 and $81.07 respectively.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2ofWp7U_JtyZcelHz_HxBzcPaEICTaXl8Y30TgkFnUOBn-EKBH11wl-G2PDHKUCTSyTozi5En_1tn8NAyry1VzpEfFH4cGjNjrOWa4xIhNVIyXCmGjH0irurCJtJgukec1dIsGrvuX4nuLuMptq_iZddmL5VtewNL4L1ePaDc_ntZlh0dB5JzWS8PgJg/s592/oil-price-friday.PNG" style="margin-left: auto; margin-right: auto;"><img alt="Oil prices: hourly updates" border="0" data-original-height="331" data-original-width="592" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2ofWp7U_JtyZcelHz_HxBzcPaEICTaXl8Y30TgkFnUOBn-EKBH11wl-G2PDHKUCTSyTozi5En_1tn8NAyry1VzpEfFH4cGjNjrOWa4xIhNVIyXCmGjH0irurCJtJgukec1dIsGrvuX4nuLuMptq_iZddmL5VtewNL4L1ePaDc_ntZlh0dB5JzWS8PgJg/s16000/oil-price-friday.PNG" title="Oil prices: hourly updates" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Hourly updates → https://www.oilfutures.co.uk/p/oil-futures-httpswwwoilfuturescouk.html</td></tr></tbody></table><br /><div style="text-align: left;"><br /></div><br /><div style="text-align: left;"><span style="font-size: large;">In addition to the uncertainty of the voluntary production cuts, the economic factors compete the energy landscape in seeking the dominance: rising cost of living that defies the supposedly falling inflation, strong US dollar, rising interest rates and slowing global growth appear to be dashing the hopes of oil producers in cashing in on production cuts - and their effect.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The OPEC+, up until recently, was optimistic about the demand of fossil fuels in the coming years - at least in public; it even locked horns with the IEA, International Energy Agency, that contradicted the optimism of the cartel with a communique, titled, ' Moment of Truth': </span><span style="background-color: white; color: #1f1f1f;"><span style="font-family: inherit; font-size: large;">OPEC Secretary General, Haitham Al Ghais, in his response, said: “It is ironic that the IEA, an agency that has repeatedly shifted its narratives and forecasts on a regular basis in recent years, now addresses the oil and gas industry and says that this is a ‘moment of truth’. The manner in which the IEA has unfortunately used its social media platforms in recent days to criticize and instruct the oil and gas industry is undiplomatic to say the least. OPEC itself is not an organization that would prescribe to others what they should do.”</span></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In fairness to the OPEC+, it must be said that the IEA has not been walking along a straight line with their forecasts either; for instance, it said </span><span style="background-color: white; color: #1f1f1f;"><span style="font-size: large;"><span face="Google Sans, Helvetica Neue, sans-serif"> </span><span style="font-family: inherit;">that global oil demand will grow by 1.2 million bpd in 2024. This is a slower pace than the agency had previously forecast, due to the global economic slowdown.</span></span></span></div></div><p></p><div style="text-align: center;"><div style="text-align: left;"><span style="font-size: large;">The current status-quo is not good for the oil producers in general and the Middle Eastern producers in particular, because the latter have to prop up the economies by the revenue from petrodollars, in order to fund the generous welfare schemes for their citizens and diversify the economies; it's a tall order, though.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The latest estimate by the IMF, International Monetary Fund, for instance, shows that the Saudis must earn at least $86 per barrel to achieve their economic goals. At present, the price in question just hovers over $80 - or even below that; the situation, unless nipped in the bud, could lead to a budget deficit in the Kingdom.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In a separate development, oil producers that are not part of OPEC+ keep producing oil unabated, without being constrained by any undue influence. Even the US has increased its production by over 1 million barrels per day, according to the latest data. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In this context, if Saudi Arabia pursues its determination to cut down on production, there will be unintended consequences, ranging from losing its market share to causing dissension among some of the OPEC+ members, especially, those from the continent of Africa. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The fact that Saudi Arabia left the price of oil for Asia unchanged may have stemmed from the very apprehension of losing existing customers. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">India, for instance, is keen to turning to Venezuela for its oil needs provided the former gets it cheap. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">All in all, aggressive production cuts leave no country in a victorious position, as the rise in energy prices fuels inflation and it is a common enemy of both producers and consumers.</span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span style="font-size: large;">- HA -</span></div><div style="text-align: left;"><br /></div></div><p></p>
<div style="text-align: center;"><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/psz3rtWeU5w?si=QBVjowPJNqltEolE" title="YouTube video player" width="560"></iframe></div>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-90850115630726628932023-11-28T23:53:00.004+00:002023-11-29T00:27:06.418+00:00Laughing in Quotas, Dancing to Baselines: trials and tribulations of OPEC+ in verse!<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj3YX5WXlxs3QfEp2z1MS3qzbVBNgJIvlIhyphenhyphenDpMAlSFpXP7KtwgoqMm9E7lz_-OqRI-36KPUiMZoVypPv_AfLiTHnt_Xp0e2MZ7uEJ1WYy9qcG1a1Zwq-DAbtKk9c-XIs0W3Y2OKr42D8tbzR7ap01bdBFu38aL-Axs1yGORwu8oaiMRxEh_UZDrfOaEQA/s625/opec.png" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="Trials and tribulations of the OPEC+" border="0" data-original-height="625" data-original-width="400" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj3YX5WXlxs3QfEp2z1MS3qzbVBNgJIvlIhyphenhyphenDpMAlSFpXP7KtwgoqMm9E7lz_-OqRI-36KPUiMZoVypPv_AfLiTHnt_Xp0e2MZ7uEJ1WYy9qcG1a1Zwq-DAbtKk9c-XIs0W3Y2OKr42D8tbzR7ap01bdBFu38aL-Axs1yGORwu8oaiMRxEh_UZDrfOaEQA/s16000/opec.png" title="Trials and tribulations of the OPEC+" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Trials and tribulations of the OPEC+</td></tr></tbody></table><br /><div style="text-align: left;"><span style="font-size: large;">All eyes are on the rescheduled meeting of the OPEC+ that is going to take place tomorrow online, if they have overcome the stumbling blocks that led to the unexpected impasse. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;">It is the 187th OPEC conference, 51st JMMC meeting and 36th ONOMM combined.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Undoubtedly, the meeting is going to be crucial for the cartel in light of price slump and failure of the existing production cuts to boost the prices.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9PCft5E_SZAIEuoAISjKS3nmvfkd6YryOhMMgBThP3HvaKLgQWmZWfYoospDRUV9VV5fORDr7187uzQKZtU1IwhAXv9yb3BE_Pas7fAEm733MfC60GXcJXsD0xEX41P1Cm1-uLTi2HHpkfVhyphenhyphenV49YP5UIzks3G-VKQHMKLeGUiaarlY4lN1Nn-q4CrEo/s490/weekly-oil-price.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="Weekly oil prices" border="0" data-original-height="355" data-original-width="490" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg9PCft5E_SZAIEuoAISjKS3nmvfkd6YryOhMMgBThP3HvaKLgQWmZWfYoospDRUV9VV5fORDr7187uzQKZtU1IwhAXv9yb3BE_Pas7fAEm733MfC60GXcJXsD0xEX41P1Cm1-uLTi2HHpkfVhyphenhyphenV49YP5UIzks3G-VKQHMKLeGUiaarlY4lN1Nn-q4CrEo/s16000/weekly-oil-price.PNG" title="Weekly oil prices" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Weekly oil prices</td></tr></tbody></table><br /></div><div style="text-align: left;"><span style="font-size: large;">It's no secret three are disagreements over the production quotas involving three African producers for 2024. Analysts say Angola, Nigeria and Congo want new production quotas, if implemented, could potentially derail the plan of Saudi Arabia and Russia in keeping the production low.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In the presence of rising inflation and its inevitable impact on the cost of living, the African countries may have tried their best to change the status quo. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The success/failure of their collective effort may be laid bare during the forthcoming meeting for the world to see; it is not going to be an easy meeting for the members, though.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><br /><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-46205250895205009062023-11-27T15:35:00.002+00:002023-11-27T15:52:30.662+00:00Oil Prices Tumble as OPEC+ Postpones Meeting; OPEC+ and IEA lock horns over renewables and peak oil demand!<p style="text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhdw0Df5CM71tOOmRqz7rbpiM2I024sexT3zkQiM65jvKGhuPAqwMbkSLiwREGlmWgOF8AnMoHVL734AOAoz6eLQ5YU6-vz3tB9ZYQ-NKJb5FuknOuuIdhNwfWGjTaRvu7F8Njuogj5FmK_FarEyAroud31vkE6n4gsECxMiStQgJnOwJUf8ZJzM_GAOnE/s600/opec-iea-spat.gif" style="margin-left: auto; margin-right: auto;"><img alt="OPEC+ and IEA lock horns.." border="0" data-original-height="358" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhdw0Df5CM71tOOmRqz7rbpiM2I024sexT3zkQiM65jvKGhuPAqwMbkSLiwREGlmWgOF8AnMoHVL734AOAoz6eLQ5YU6-vz3tB9ZYQ-NKJb5FuknOuuIdhNwfWGjTaRvu7F8Njuogj5FmK_FarEyAroud31vkE6n4gsECxMiStQgJnOwJUf8ZJzM_GAOnE/s16000/opec-iea-spat.gif" title="OPEC+ and IEA lock horns.." /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">OPEC+ and IEA lock horns...</td></tr></tbody></table><br /><p></p><p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span style="color: #1f1f1f; font-family: inherit; font-size: large; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;">On November 22, 2023, the Organization of the
Petroleum Exporting Countries (OPEC) and Russia, collectively known as the OPEC+, surprised
the energy markets by announcing that their upcoming meeting, scheduled for
November 26, would be postponed.<o:p></o:p></span></p><div>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face=""Arial",sans-serif" style="color: #1f1f1f; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;"><span style="font-family: inherit; font-size: large;">The meeting had been scheduled to discuss the
production levels for the next year, 2024. Not only did the bad news shock the
market, but also pushed the price of oil down by more than 5%, as analysts sensed
that something has sprung into existence that was not conducive for the anticipated, further production cuts.</span><o:p style="font-size: 12pt;"></o:p></span></p><p class="MsoNormal" style="background: white; line-height: normal; margin: 18pt 0cm; text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj-QMepn_NZApoEOAbe3Ptw5-Ln6edJN8JFjmkhfZ39oHn_kfMSPmARMxGfma1jjSiI7HpXnNyCE8CEdOVHVd66-xhUdNu4_udjOdR2EsMjuzF5ASQfb52e7yVv8sI_Tllc8_zhgSXu-gC_A4L3lo19N6txG6rBa2ez2VfHauwhfKq3mdEbmEzYDJqLubk/s581/oil-price-monday.PNG" style="margin-left: auto; margin-right: auto;"><span style="font-size: large;"><img alt="Hourly Oil prices - Monday" border="0" data-original-height="311" data-original-width="581" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj-QMepn_NZApoEOAbe3Ptw5-Ln6edJN8JFjmkhfZ39oHn_kfMSPmARMxGfma1jjSiI7HpXnNyCE8CEdOVHVd66-xhUdNu4_udjOdR2EsMjuzF5ASQfb52e7yVv8sI_Tllc8_zhgSXu-gC_A4L3lo19N6txG6rBa2ez2VfHauwhfKq3mdEbmEzYDJqLubk/s16000/oil-price-monday.PNG" title="Hourly Oil prices - Monday" /></span></a></td></tr><tr><td class="tr-caption" style="text-align: center;"><a href="https://www.oilfutures.co.uk/p/oil-futures-httpswwwoilfuturescouk.html" target="_blank"><span style="font-size: large;">Hourly Oil prices - Monday</span></a></td></tr></tbody></table><span style="font-size: large;"><br /><span face=""Arial",sans-serif" style="color: #1f1f1f; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;"><br /></span></span><p></p>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face=""Arial",sans-serif" style="color: #1f1f1f; font-size: large; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;">A bone of contention, according to some analysts,
appears to be over the collective output: is it going to be maintained at the current level
or going to be deepened further? The OPEC+, however, implied that the cartel
wanted more time to gauge the global economic outlook before making a decision, despite
a space of one week being not enough to embark on a serious study on the issue in
question.<o:p></o:p></span></p>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face=""Arial",sans-serif" style="color: #1f1f1f; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;"><span style="font-size: large;">Whatever the merits of the claim, the prices of the two main benchmarks suffered significantly, as more factors making their impact felt
across the sector. The US crude stocks, for instance, have been increasing
steeply, indicating a weakening demand.</span><o:p style="font-size: 12pt;"></o:p></span></p><p class="MsoNormal" style="background: white; line-height: normal; margin: 18pt 0cm; text-align: center;"></p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://www.eia.gov/petroleum/weekly/images/crstusm.gif" style="margin-left: auto; margin-right: auto;"><img alt="US crude oil stocks - EIA" border="0" data-original-height="384" data-original-width="719" height="342" src="https://www.eia.gov/petroleum/weekly/images/crstusm.gif" title="US crude oil stocks - EIA" width="640" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">US crude oil stocks - EIA<br /><br /><br /></td></tr></tbody></table><span face="Arial, sans-serif" style="color: #1f1f1f; font-size: 12pt; text-align: left;"></span><p></p><div style="text-align: left;"><span style="font-size: large;">Analysts, meanwhile, in the absence of a serious
impact from the war in the Gaza Strip on the production or prices, are divided on the outlook for
oil prices following the postponement of the OPEC+ meeting. Some believe that
prices could fall further in the near term, while others believe that prices
could rebound once the group meets and reaches a decision on production levels.</span></div><p></p>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face=""Arial",sans-serif" style="color: #1f1f1f; font-size: large; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;">Of course, the postponement of the OPEC+ meeting
has created uncertainty in the oil market. What really matters is the decision
they are planning to make at the end of this month amid the furore: are Nigeria
and Angola finally coming on board to reach a consensus over their corresponding
baseline quotas? Only time will tell; i.e., in about 5 Earth days.<o:p></o:p></span></p>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face="Arial, sans-serif" style="color: #1f1f1f; font-size: large;"><span>Meanwhile, in an extraordinary development, the IEA,
International Energy Agency and OPEC+ locked horns over statement made by the former,
titled, “Moment of Truth”, in which it said, “The industry has been told that
it must “choose between </span>fueling<span> the climate crisis or embracing the shift to
clean energy.” The OPEC+ hit back quite harshly by saying, “<a href="https://www.opec.org/opec_web/en/7262.htm#:~:text=We%20need%20to%20understand%20that,emissions%20at%20the%20same%20time.%E2%80%9D" target="_blank">Whose moment of truth?</a>”<o:p></o:p></span></span></p>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face=""Arial",sans-serif" style="color: #1f1f1f; font-size: large; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-GB; mso-font-kerning: 0pt; mso-ligatures: none;">OPEC Secretary General, Haitham Al Ghais, in
response, said: “It is ironic that the IEA, an agency that has repeatedly
shifted its narratives and forecasts on a regular basis in recent years, now
addresses the oil and gas industry and says that this is a ‘moment of truth’.
The manner in which the IEA has unfortunately used its social media platforms
in recent days to criticize and instruct the oil and gas industry is
undiplomatic to say the least. OPEC itself is not an organization that would
prescribe to others what they should do.”<o:p></o:p></span></p>
<p class="MsoNormal" style="background: white; line-height: normal; margin-bottom: 18.0pt; margin-left: 0cm; margin-right: 0cm; margin-top: 18.0pt; margin: 18pt 0cm;"><span face="Arial, sans-serif" style="color: #1f1f1f;"><span style="font-size: large;"><span>That means, the members of the OPEC+ are determined to address
one of the main key issues facing the industry – the lack of long-term investment
due to uncertainty. The spat between the two key </span>organizations</span><span><span style="font-size: large;"> that control the
energy sector, however, is adding yet another worry to existing ones of the
OPEC+ - and those of the consumers.</span><o:p style="font-size: 12pt;"></o:p></span></span></p></div><p style="text-align: center;"><br /><br /><br /><br /></p><div style="text-align: left;"><br /></div><br /> <p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-1219721197835533682023-11-22T11:24:00.008+00:002023-11-22T11:49:30.707+00:00The three pillars that support oil markets: availability, affordably and sustainability! <p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhJFaIpHEG377ihAnMvgH-t4OgNaAPMn9v8_pNDJXBRv_WeZw8Rp0zDpoqHaifeo0RmxNB4b6-en22U7dD92lYhf13qNaXaHpWTqCNE2spoWzrjUt9d8K2a89YB4QoY3zJMWvGxfYk_s7PvRefhREq6sMU-UKnoguEpxwK6-GNeVfXLotshsSx9LpsEdUo/s600/indian-oil-facts.jpeg" style="margin-left: auto; margin-right: auto;"><img alt="India: energy facts" border="0" data-original-height="328" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhJFaIpHEG377ihAnMvgH-t4OgNaAPMn9v8_pNDJXBRv_WeZw8Rp0zDpoqHaifeo0RmxNB4b6-en22U7dD92lYhf13qNaXaHpWTqCNE2spoWzrjUt9d8K2a89YB4QoY3zJMWvGxfYk_s7PvRefhREq6sMU-UKnoguEpxwK6-GNeVfXLotshsSx9LpsEdUo/s16000/indian-oil-facts.jpeg" title="India: energy facts" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">India: energy facts</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">At present, the speculations run rife in the energy markets about the next move by Saudi Arabia and Russia in the face of falling oil prices. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Every oil analyst ponders the thought - and inevitable consequences - of yet another production cut by some oil producers in order to shore up the prices, despite the possibility of every member of the OPEC+ being on the wavelength remains low.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">To this day, however, the two bigwigs of the OPEC+ appeared to have chosen to be tightlipped about their next move.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Saudi Arabia and Russia unilaterally embarked on a production cut of 1.5 million bpd - barrels per day - despite the protests from the consumer nations. Even the world's largest oil producer, the US, was not pleased with the move, but equally helpless to reverse it or at least make a dent on it.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Both Saudi Arabia and Russia have already confirmed the production cuts will remain through December, leaving the scenario beyond that a closely-guarded secret.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">As of 10:14 GMT, the prices of WTI - West Texas Intermediate - and Brent were trading at $77.13 and $81.82 respectively. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><div style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjWLoBTPzOJN9PKetV8DVSkZVG_8zrlvn7Fx6n5sq6Sp6Y7lJPXrCHvvOQxUJkNyKHDJuGCxeHpPsMV-XEIecnRJWaJDwWMetKRilE4Ke9txRO43TTE2ZpryOTV15Rq9a6GsGhaZpL6HJL4z4IRxPBLeKZuHrQu6NrS8IGkapiCm0GfjrW1o4cd995uRFI/s588/oil-price-wednesday.PNG"><img alt="Oil price on Wednesday" border="0" data-original-height="351" data-original-width="588" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjWLoBTPzOJN9PKetV8DVSkZVG_8zrlvn7Fx6n5sq6Sp6Y7lJPXrCHvvOQxUJkNyKHDJuGCxeHpPsMV-XEIecnRJWaJDwWMetKRilE4Ke9txRO43TTE2ZpryOTV15Rq9a6GsGhaZpL6HJL4z4IRxPBLeKZuHrQu6NrS8IGkapiCm0GfjrW1o4cd995uRFI/s16000/oil-price-wednesday.PNG" title="Oil price on Wednesday" /></a></div><a href="https://www.oilfutures.co.uk/p/oil-futures-httpswwwoilfuturescouk.html" target="_blank">Hourly Updates</a><br /></div><div style="text-align: center;"><br /></div><div style="text-align: left;"><span style="font-size: large;">As for Saudi Arabia, this is not what they anticipated, when their break-even price, based on the estimates of the IMF, International Monetary Fund, is just over $80. If the prices remain at this level, funding their gigantic, ambitious projects such as the NEOM that claims to revolutionize the urban living will be challenging, if not in jeopardy. </span><span style="font-size: x-large;"> </span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In theory, a production cut that is equivalent to supply cut, leads to a rise in price. In a market where the prices oscillate on the fulcrum of sentiment, the price of oil did go up when the announcement grabbed the headline - in line with the basic economics.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">It's not rocket science, however, to anticipate what comes next: the lower the production, the greater the fall in revenue you earn from the very commodity.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Aramco, the main oil company in Saudi Arabia, announced that their profit in the third quarter, Q3, has gone down by 23%; the corresponding losses for the Q1 and Q2 were equally significant.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: center;"><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgrtWQtmgqGrJrc9uVwcS-BDz4fpuELO5fcG3-iLEkL48auP4knmscIOImOn8RmuDkG0_0fCjbD-KGcKxU7_cjVCn-46ioFEUWEYj25iwG85osUtwmFQVznIm_g0KF-IbxJ6IQTqM72FSTAoX7g7QKn3WDKE63oBr5nFW7XeAY9HEWxssiQSZKsItrrlbc/s500/falling-profits-saudi-aramco.png" style="margin-left: 1em; margin-right: 1em;"><img alt="Falling profits of Saudi Aramco" border="0" data-original-height="375" data-original-width="500" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgrtWQtmgqGrJrc9uVwcS-BDz4fpuELO5fcG3-iLEkL48auP4knmscIOImOn8RmuDkG0_0fCjbD-KGcKxU7_cjVCn-46ioFEUWEYj25iwG85osUtwmFQVznIm_g0KF-IbxJ6IQTqM72FSTAoX7g7QKn3WDKE63oBr5nFW7XeAY9HEWxssiQSZKsItrrlbc/s16000/falling-profits-saudi-aramco.png" title="Falling profits of Saudi Aramco" /></a></div>Falling profits of Saudi Aramco<br /><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">It is highly likely that Saudi Arabia and Russia may extend the production cuts beyond December despite the palpable apprehension of the consumers. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">India, the word's third largest oil importer, meanwhile, highlighted the importance of the crude oil markets being well-supplied for the stability on many fronts - not necessarily on the economic front.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Hardeep Singh Puri, the Indian oil minister, for instance, emphasized the need of maintaining market stability for the benefit of the consumers, producers and global economy.</span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">At the <b><i>6th India-OPEC</i></b> dialogue that took place in Vienna, Austria, on November 6, Mr Puri highlighted his concerns over the pressing issue, especially from consumers' point of view. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The discussions revolved around the combined axis of availability, affordability, and of course, sustainability. Judging by the optics of the meeting, it appeared to be a productive discussion.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">In the meeting, Mr Puri appealed to the producers to take constructive steps to strengthen the three pillars for the sake of the global economy - and simultaneously. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The role of India has been hailed as pragmatic in the discussion, as it, quite rightly, took into account the plight of producers in the event of prices falling far below the sustainable level, as happened during the Covid-19 pandemic; on April 20 2020, the price of oil went negative for the first time ever, with WTI recording a price, -$37.63!</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although the markets welcome the potential arrival of Venezuelan oil, it has been countered by the harsher sanctions on the Iranian oil; the US is hell bent on targeting the ports that offload Iranian oil, something that the former turned a blind eye on before, despite the Western sanctions being in place - for obvious reasons.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">With the SPR - Strategic Petroleum Reserve - of the US at a historic low, the US is helpless in controlling the price of oil, if it rises again.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Anticipating the worst-case scenario, the US appeared to have turned to Venezuela, its old nemesis, as the last resort to boost the supply, having tried the same with Iran for months while trying to revive the 2015 nuclear deal, known as the JCPOA, but in vain.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Oil prices are stable at present, not thanks to the boost of production by the Latin American nation, but due to the falling demand that has stemmed from far-from-rosy global economic outlook. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS9Fy-7-euRuq0HIr4eICbDt4vg30nJKZYQ8PGHGbcWAa5SXkjUnLRY0s0hqGq9aTF-xmabDNoqa7H_hmoL2IZW2-JPiX8ezCgHePKRk6fAYJIMjKt69mJR9HnJwovu_hU34ieZUoY-mGfglKa25r7rieW32spxiRbb2mvd3CGcuFQQKYH2bCfuEkHpkI/s490/drop-in-oil-price.PNG" style="margin-left: auto; margin-right: auto;"><img alt="Falling oil prices - www.oilfutures.co.uk" border="0" data-original-height="334" data-original-width="490" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS9Fy-7-euRuq0HIr4eICbDt4vg30nJKZYQ8PGHGbcWAa5SXkjUnLRY0s0hqGq9aTF-xmabDNoqa7H_hmoL2IZW2-JPiX8ezCgHePKRk6fAYJIMjKt69mJR9HnJwovu_hU34ieZUoY-mGfglKa25r7rieW32spxiRbb2mvd3CGcuFQQKYH2bCfuEkHpkI/s16000/drop-in-oil-price.PNG" title="Falling oil prices - www.oilfutures.co.uk" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Falling oil prices - www.oilfutures.co.uk</td></tr></tbody></table><br /></div><div style="text-align: left;"><span style="font-size: large;">In this context, if Saudi Arabia - and Russia for that matter - embark stubbornly on yet another production cut, the consequences will be disastrous for the global economy. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">A move of that kind will not strengthen the three pillars that they discussed at India-OPEC summit recently. On the contrary, it has the potential to trigger off a jolt on all three pillars simultaneously without much effort. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><div style="text-align: left;"><span style="font-size: x-large;"><br /></span></div><p></p>Unknownnoreply@blogger.comtag:blogger.com,1999:blog-1826246588600155044.post-7446248928697809272023-11-16T16:37:00.003+00:002023-11-16T16:40:26.490+00:00Oil price: can Venezuela fill the void, if demand is on the rise - again?<p style="text-align: center;"> </p><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEJm95fhWgjtElbQbhC2cEDwN7Pnk_ZtJv49cI9QtnJPAAbv6QG0Uibu13hXAW29O88fDR-7e5drhsxSkY2CbUehnWsiW_4oD_60mrex2jOVVgpC2bSOVBpb8rUr7_QNZcRJmNkXQbhOF_4TafSkue3XSo3VyZgpRoFhzpk7pKeEbCdQRm9gpz5Uo5n70/s600/venezuela-oil-export.png" style="margin-left: auto; margin-right: auto;"><img alt="Venezuela oil export" border="0" data-original-height="353" data-original-width="600" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEJm95fhWgjtElbQbhC2cEDwN7Pnk_ZtJv49cI9QtnJPAAbv6QG0Uibu13hXAW29O88fDR-7e5drhsxSkY2CbUehnWsiW_4oD_60mrex2jOVVgpC2bSOVBpb8rUr7_QNZcRJmNkXQbhOF_4TafSkue3XSo3VyZgpRoFhzpk7pKeEbCdQRm9gpz5Uo5n70/s16000/venezuela-oil-export.png" title="Venezuela oil export" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Venezuela oil export</td></tr></tbody></table><br /><p></p><div style="text-align: left;"><span style="font-size: large;">The pendulum of oil prices is back in the bearish territory, dealing a heavy blow to the ambitious producers in the OPEC+, mainly Saudi Arabia and Russia that tried in vain to push it to the polar opposite.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">On Thursday afternoon, the selling price of crude oil fell almost by $8, with WTI and Brent recording $73.75 and $78.28 respectively; at some point, the price went down by over $2.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: center;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgA6BRxPqIC-Re5nVKHoj6_zCijKe2gMF8lO3cNw8vGJLommLnufs3sPzyAXPbqA7gwbYnAPT2qqy2Mm-3vk86xWJroDXXtayKPVFukBRgDo7c2R8Vst-J22haDVVZvw7M-2brl8PzlYqXI2rcfdg6VXDHOvb4vTNsLxRvtH6loPBHhwC5t5sC85xfYq3o/s598/oil-price-thursday.PNG" style="margin-left: auto; margin-right: auto;"><img alt="Oil price on the decline" border="0" data-original-height="359" data-original-width="598" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgA6BRxPqIC-Re5nVKHoj6_zCijKe2gMF8lO3cNw8vGJLommLnufs3sPzyAXPbqA7gwbYnAPT2qqy2Mm-3vk86xWJroDXXtayKPVFukBRgDo7c2R8Vst-J22haDVVZvw7M-2brl8PzlYqXI2rcfdg6VXDHOvb4vTNsLxRvtH6loPBHhwC5t5sC85xfYq3o/s16000/oil-price-thursday.PNG" title="Oil price on the decline" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Oil price on the decline</td></tr></tbody></table><br /><div style="text-align: left;"><span style="font-size: large;">Neither the war sentiment in Gaza nor the supply constrains applied to Iranian oil could push the price of oil up, defying logic.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although Venezuela is allowed to sell its oil now, years of sanctions, coupled with negligence and lack of investment, have taken their toll on its oil industry. Therefore, it is not feasible for Venezuela to make a swift, significant contribution to the oil markets.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">From June up until August </span><span style="font-size: x-large;">t</span><span style="font-size: large;">his year, the oil exports from Venezuela have, actually, declined. The EIA, US Energy Information Administration, estimates the oil output from Venezuela will be less than 200,000 bpd in 2024 despite the involvement of the US oil giants in extracting the commodity, thanks to the sanction waive introduced by the US in October for six months.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">The improvements that need to be made to the oil infrastructure, according to the EIA, will take time. On the other hand, the Latin American country is supposed to hold free and fair elections for the continuation of the sanction waiver beyond the six-month period that ends in April, 2024.</span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Although the OPEC+ and IEA, International Energy Agency, expect the demand of crude oil to grow, the economic worries have cast a shadow over the optimism. </span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;">Against this backdrop, President Xi Ji Ping of China and President Biden met in the US, perhaps to explore the possibility of bringing about a thaw in the current frosty relations between the world's two largest economies; President Xi was reported to have said, "</span><span style="background-color: white; color: #202124;"><span style="font-family: inherit; font-size: large;">Planet Earth is big enough for the two countries to succeed, and one country's success is an opportunity for the other," during his conversation with President Biden.</span></span></div><div style="text-align: left;"><span style="background-color: white; color: #202124;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="background-color: white; color: #202124;"><span style="font-family: inherit; font-size: large;">President Xi must have meant the disastrous consequences on China's own economy - and on the US and the West in the long run - if the current tit-for-tat activities were to continue in the existing form. Chinas manufacturing growth has shrunk again in October, having recorded a modest growth since May, this year.</span></span></div><div style="text-align: left;"><span style="background-color: white; color: #202124;"><span style="font-family: inherit; font-size: large;"><br /></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;">Saudi Arabia, meanwhile, is not open about its position on production cuts after December next year. It admitted that the profits of the main oil company, Aramco, have </span><span style="color: #202124;">plummeted</span><span style="color: #202124; font-family: inherit;"> by over 23%, due to production cut that inevitably led to the falling sales; in order to mitigate the impact, Saudi Arabia has left the price of light crude oil to Asia unchanged. </span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;"><br /></span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;">The Saudis know that India and China will turn to Venezuela for crude oil if the latter sells it cheap. The move by Saudi Arabia to leave the price unchanged may have stemmed from a concern over the position of India and China in this regard.</span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;"><br /></span></span></span></div><div style="text-align: center;"><span style="background-color: white;"><span style="font-size: large;"><div class="separator" style="clear: both; text-align: center;"><a href="https://www.hellenicshippingnews.com/wp-content/uploads/2021/10/030dfeet.jpg" style="margin-left: 1em; margin-right: 1em;"><img alt="Russian oil exports" border="0" data-original-height="642" data-original-width="777" height="331" src="https://www.hellenicshippingnews.com/wp-content/uploads/2021/10/030dfeet.jpg" title="Russian oil exports" width="400" /></a></div></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;"><br /></span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;">Russia's oil revenue, meanwhile, has risen by $1.8 billion in September - the highest since July, 2022. </span></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;"><br /></span></span></span></div><div style="text-align: center;"><span style="background-color: white;"><span style="font-size: large;"><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhcGjLjrTqMzg_qnBsA6gPYRUE6o1QXMaNHzuE1Cm_BbjBlMr2yC2cAZ6SCRr7SMP6r7AjY8eztU6-vAXpfogRDvilu2WQrphXIbGssIg7RncIYvIA8TyJcJXto1yTbckp-9zx3FWCu9ncpkgcHRPb00ASbUp2Hlar7XoMXgaVA2s8XY4_Idk1dB_KwgSM/s485/falling-oil-prices.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img alt="Falling oil prices - November 2023" border="0" data-original-height="339" data-original-width="485" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhcGjLjrTqMzg_qnBsA6gPYRUE6o1QXMaNHzuE1Cm_BbjBlMr2yC2cAZ6SCRr7SMP6r7AjY8eztU6-vAXpfogRDvilu2WQrphXIbGssIg7RncIYvIA8TyJcJXto1yTbckp-9zx3FWCu9ncpkgcHRPb00ASbUp2Hlar7XoMXgaVA2s8XY4_Idk1dB_KwgSM/s16000/falling-oil-prices.PNG" title="Falling oil prices - November 2023" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;">Falling oil prices - November 2023</td></tr></tbody></table><br /></span></span></div><div style="text-align: left;"><span style="background-color: white;"><span style="font-size: large;"><span style="color: #202124; font-family: inherit;">In this context, it is not clear at this stage whether Russia and Saudi Arabia see eye to eye on extending the production cuts beyond December in light of falling oil prices and the estimated contribution from Venezuela. </span></span></span></div><br /><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><div style="text-align: left;"><span style="font-size: large;"><br /></span></div><br /><p></p>Unknownnoreply@blogger.com