WTI Breaches $70 On Iran, Venezuela Fears | OilPrice.com
WTI Breaches $70 On Iran, Venezuela Fears
By
Irina Slav - May 07, 2018, 9:30 AM CDT
A deepening economic crisis in Venezuela and the approaching deadline for President Trump’s decision on the Iran nuclear deal combined to push West Texas Intermediate above US$70 for the first time in years.
At the time of writing, the U.S. benchmark traded at US$70.45 a barrel, up by 1.05 percent from Friday’s close, with Brent crude at US$75.69 a barrel, up by 1.10 percent.
President Trump is due to announce his decision on the Iran nuclear deal by this Saturday with the majority of observers expecting him to pull out of the deal and reimpose sanctions on Tehran. This would push oil prices higher, however, which Trump doesn’t want, if we are to judge by a recent tweet, in which the President scolded OPEC for manipulating prices higher.
At the same time, Venezuelan oil production has shrunk to 1.5 million bpd from twice that about 20 years ago as it lacks the financial means to maintain fields. Also, one of the companies that have sued the country for its forced nationalization of the oil industry, Conoco, last week
obtained court attachment for PDVSA storage, processing, and blending facilities in the Caribbean. If Conoco assumes control over these facilities, it would further hurt Venezuela’s oil revenues.
Related: Canada Oil Revenues Fall Despite Production Growth
Meanwhile, bullish bets on WTI
fell to their lowest since January last week for the second week in a row. That’s despite upbeat bank forecasts about oil prices and escalating geopolitical tensions, especially after Israel’s Prime Minister revealed an alleged mountain of evidence that Iran had cheated on the nuclear deal two weeks ago.
Speculators, however, are wary of the possibility that these tensions have been already factored into prices, and fear that the return of U.S. sanctions against Tehran will not have a significant effect on prices. Alternatively, they may be exiting their long positions on WTI on the slim chance that Trump will not renew the sanctions, which will likely lead to a price slump.
By Irina Slav for Oilprice.com
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Iran opposes higher oil prices, signaling divide with Saudis
Iran opposes higher oil prices, signaling divide with Saudis
By ARSALAN SHAHLA on 5/7/2018
TEHRAN (Bloomberg) -- Iran, faced with a possible restoration of U.S. sanctions, came out against higher oil prices, signaling a split with fellow OPEC member and political rival Saudi Arabia, which is showing a willingness to keep tightening crude markets.
A “suitable price” for crude is $60 to $65/bbl, Amir Hossein Zamaninia, deputy oil minister for international and commercial affairs, said in an interview Sunday in Tehran. Oil Minister Bijan Namdar Zanganeh said earlier in the day that Iran supports “reasonable” oil prices and is not an advocate of costlier crude.
Brent crude futures surged above $75/bbl to a three-year high on Monday as traders braced for the possible re-imposition of U.S. restrictions on Iran. The Persian Gulf country’s regional arch-rival Saudi Arabia is said to want crude closer to $80/bbl, in part to support a stake sale in state energy giant Aramco. The OPEC nations continue to clash in proxy conflicts from Syria to Yemen.
The Organization of Petroleum Exporting Countries will meet next month in Vienna. Together with allied producers, OPEC began reducing oil production last year in a drive to clear a global glut. The curbs have all but eliminated surplus oil inventories. Even so, Saudi Arabia, the world’s largest crude exporter, is urging fellow members to keep curtailing output.
The constant fluctuation in oil prices is destabilizing for future investment and security of supply, Zanganeh said. He made no mention of the multiparty nuclear accord that eased sanctions on Iran starting in January 2016, but he warned that the insertion of politics into the energy market will hurt producers and consumers alike.
“We strongly believe the oil market should not be political,” Zanganeh said. “Political interference will disrupt the process of development and exchange in the market.”
Renewed U.S. sanctions on Iran may disrupt more than the Gulf nation’s oil exports. Iran holds the largest proven reserves of natural gas, and its gas and petrochemical industries have continued to grow since sanctions curbs were eased more than two years ago.
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TransCanada plans to clear Montana land for Keystone XL in fall
TransCanada plans to clear Montana land for Keystone XL in fall
By RYAN COLLINS on 5/4/2018
HOUSTON (Bloomberg) -- TransCanada Corp. will take the initial steps of clearing brush in Montana this fall for construction of the highly-contentious Keystone XL pipeline.
Construction on the conduit may begin next year, according to a U.S. State Department letter addressed to the Assiniboine and Sioux Tribes obtained by Bloomberg News. The purpose of the letter, dated April 10, was to continue government-to-government communication in order to “avoid, minimize or mitigate” any negative effects of the project.
The 1,200-mi (1,900-km) crude oil pipeline that will connect Alberta’s oil sands to Steele City, Nebraska, has been controversial. While it’s considered necessary for Canadian oil producers, who have seen prices drop because a lack of conduits to take their fuel to hotter markets, it’s been fought by environmentalists. Construction beginning in Montana inches TransCanada one step closer to shutting the door on this decade-long debate.
TransCanada expects “construction to begin in 2019 and we are conducting the necessary work to prepare for those activities,” Matthew John, a spokesman for TransCanada, said in an email Thursday.
Finite queste linee USA ridurrà la sua dipendenza dalla roba pesante venezuelana . imho.