Russian Oil and Gas Industry: News

European Parliament calls for the Nord Stream 2 construction to be cancelled

http://tass.com/economy/1035741

Nibiru wrote:

European Parliament calls for the Nord Stream 2 construction to be cancelled

http://tass.com/economy/1035741

The oil producer’s group has been seriously weakened by its need to bring an outsider into its heart to broker a deal on output.

If anyone doubted that OPEC is now little more than a zombie organization, the last 10 days have proved it.

The group has shown itself incapable of making it own decisions. Its smaller members have borne the brunt of an agreement to cut output that was only achieved after Russia took control of discussions from the heart of OPEC’s head office. Then, even after Saudi Arabia announced it would reduce supply by nearly a million barrels a day by January, oil traders merely shrugged.

It is a sad result for an organization that once made governments tremble. Here’s how it unfolded.

OPEC oil ministers gathered in the group’s secretariat building on a wintry Thursday in Vienna. Weakening demand growth and soaring U.S. production prompted agreement that they needed to reduce production in order to balance the market in 2019. What they didn’t see eye to eye on was how to share that burden.

Saudi Oil Soars

Saudi Arabia insisted that all members should play an equal part, cutting by the same percentage from a new baseline set at October’s production level. Naysayers argued that, given how the group’s biggest producer had boosted its own output by more than a million barrels a day since May, it should therefore bear the brunt of the cuts needed to get the market back into balance. Furthermore, Iran led a contingent of countries claiming their special circumstances warranted exemptions.

The stand-off looked very similar to the one that had scuppered a deal in Doha in April 2016 – something that nobody wanted to repeat. But by the end of that Thursday, Dec. 6, officials had failed to reach an agreement and Saudi oil minister Khalid Al-Falih said he was “not confident” one was possible. The gala dinner at the Liechtenstein Palace was sparsely attended, with both the Saudi and Iranian delegations, among others, skipping the event.

Friday, the day originally scheduled for the group to meet with its partners, began little better. OPEC ministers were once again locked away in discussions. The talks went nowhere, and the OPEC+ meeting got pushed back to the afternoon.

Then the Russians arrived.

Bilateral discussions to hammer out negotiating positions are a regular feature of the days and hours before the main OPEC gatherings. They take place in the suites of Vienna’s grandest hotels, where the various delegations are holed up. In recent years, the Russians have been part of this scene.

But when Russian Energy Minister Alexander Novak arrived Friday morning, he moved in to the office of OPEC’s Secretary General. If ever there was a symbol of OPEC’s demise, it was this. He then summoned first Iran’s oil minister, then Saudi Arabia’s, for about 45 minutes each. Two hours later, the group reached a deal. And Iran, Libya and Venezuela got their exemptions, even if they didn’t appear in the final communiqué.

The agreement that emerged is, on paper, fair and reasonable. OPEC will cut production by 800,000 barrels a day from a new baseline of October 2018 production, with participating members cutting by 3 percent. The group’s partners will reduce their supply by 2 percent, contributing a further 400,000 barrels a day. That combined reduction is just about enough to balance supply and demand in the first half of next year.

Saudi Arabia went even further. Al-Falih said the kingdom’s production would fall to 10.2 million barrels a day in January, down from 11.1 million last month.

That looks like a huge cut, but it is still 150,000 barrels a day above its target under the original deal.

And this is where the inequality of the new OPEC+ deal becomes apparent. Saudi Arabia, Russia, the United Arab Emirates and Iraq boosted their combined output by almost 1.6 million barrels a day between May and October. That not only contributes to the current glut, it also gives them much higher starting points for the latest cuts than for the previous ones. Other OPEC members all face lower starting points.

Unfair Shares

The effect has been to shift a disproportionate share of the burden of OPEC’s supply management since 2016 onto the group’s smaller producers.

Handing control of OPEC decision making to the Kremlin has come at a high cost for the group, and most particularly for its smaller members. Some of the latter were already feeling marginalized. This latest deal will do nothing to change their view and the divisions between the organization’s “haves” and “have nots” will only widen.

Russia has done very well out of this. It agreed to cut output by 230,000 barrels a day from its October output level of 11.42 million. That would reduce its production to 11.19 million barrels a day, a figure that is just 15,000 barrels below its original 2016 baseline — a cut of just 0.1 percent.

Contrast that with OPEC member Algeria, which produces around a tenth as much oil as Russia. Its new target will be 1.023 million barrels a day. That’s a cut of 66,000 barrels a day, or 6.1 percent below the 2016 baseline.

And what did this all achieve?

Oil markets have reacted with indifference. After a brief rally when the deal was revealed, Brent subsequently sank back below the level it was trading at before the meeting began. Perhaps traders don’t believe the group will be able to implement the arrangement, or are waiting to see evidence that it’s taken effect.

OPEC has lost a lot for very little gain.

JohninMK wrote:
   Pictures

   Home
   World
   News
   Bulgaria Hopes to Promptly Resolve All Possible Obstacles to Joining TurkStream

Bulgaria Hopes To Promptly Resolve All Possible Obstacles To Joining TurkStream

Sumaira FH 3 minutes ago Mon 17th December 2018 | 05:57 PM
Bulgaria Hopes to Promptly Resolve All Possible Obstacles to Joining TurkStream
Bulgaria hopes to settle all possible problems that may arise during talks devoted to the country's potential role as a transit state for gas flowing from Russia through the TurkStream pipeline as soon as possible, Vice-President of the National Assembly Emil Hristov said Monday.
MOSCOW (UrduPoint News / Sputnik - 17th December, 2018) Bulgaria hopes to settle all possible problems that may arise during talks devoted to the country's potential role as a transit state for gas flowing from Russia through the TurkStream pipeline as soon as possible, Vice-President of the National Assembly Emil Hristov said Monday.

"Before leaving, we spoke to Bulgarian Energy Minister [Temenuzhka Petkova]. We were told that a provider tender was about to be declared, which [sounds] positive to me. We hope to resolve all possible issues in the coming months," Hristov said after a meeting with Konstantin Kosachev, the chairman of the Russian upper house Foreign Affairs Committee.

The TurkStream pipeline project envisages the construction of a gas pipeline comprising two legs, each with the capacity to deliver 15.7 billion cubic meters (554 billion cubic feet) of gas per year. The first leg is set to bring gas across the Black Sea directly to Turkey, while the other one will run across Turkey to its western border, transporting natural gas to countries in the south and southeast of Europe.

Russia's energy giant Gazprom, responsible for the pipeline's construction, has been considering options for extending the second leg of the pipeline through Bulgaria and Serbia or through Greece and Italy.

https://www.urdupoint.com/en/world/bulgaria-hopes-to-promptly-resolve-all-possib-508431.html

Hole wrote:Now they start building ships using LNG.

GarryB wrote:The thing is that an electric car needs to store energy in some form and we all know what batteries are like with low temperatures.

Having an LPG powered car is actually very very easy... you take a normal petrol driven car and make a few minor changes.

In the 1970s the shortage of petrol was such that we actually had carless days... where your car could only be driven on specific days.

The direct result was that a large number of petrol driven cars were converted to also use LPG. An LPG tank was placed in the boot to store the gas and the existing petrol engine was slightly modified to burn LPG instead of Petrol.

A small switch inside the car changed the engine from running on petrol or LPG and you could change between them easily with the engine off.

It was very easy to do, but when they got petrol back in stock strangely the price of petrol became so low that people stopped using LPG, but these days the price of petrol I am surprised more people are not using LPG here.

Have never owned a converted vehicle myself so I can't tell you about any problems it might have...

JohninMK wrote:Huge news today


Turkstream gas pipe is all systems go both in Bulgaria and Serbia. Huge sigh of relief head in southern/central Europe whilst knashing of teeth heard in DC.

https://www.b92.net/eng/news/business.php?yyyy=2019&mm=02&dd=01&nav_id=106116

JohninMK wrote:Huge news today


Turkstream gas pipe is all systems go both in Bulgaria and Serbia. Huge sigh of relief head in southern/central Europe whilst knashing of teeth heard in DC.

https://www.b92.net/eng/news/business.php?yyyy=2019&mm=02&dd=01&nav_id=106116