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Tag Archives: OPEC

With oil prices falling, Putin has OPEC over a barrel

OPEC is learning the dangers of dealing with the Kremlin. President Vladimir Putin now has the group’s Middle East kingpin Saudi Arabia over a barrel and can name his own terms to continue their partnership. The oil cartel depends on extending its alliance with Russia to keep restricting supplies if it stands any chance of engineering a quick rebound in prices. The price of Brent crude has collapsed by almost 15% since April, briefly falling below $60/b last week. Depressed prices are good...

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Insight Conversation: Fatih Birol, IEA

Fatih Birol, executive director of the International Energy Agency, spoke to Paul Hickin about the new oil market dynamics unleashed by US shale production, challenges facing Venezuela, and heightened geopolitical risk. In 2012, Fatih Birol predicted that the US would become the largest oil producer by the end of the decade. In an exclusive interview with S&P Global Platts at the IEA headquarters in Paris, Birol did not hold back in outlining the impact US supply is now having on OPEC....

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US war with Iran unlikely, but would devastate oil markets: Fuel for Thought

Drone attacks on pipelines in Saudi Arabia and the mysterious alleged sabotage of tankers near Fujairah sent pulses racing, but a phony war in the Persian Gulf failed to trigger a feared triple-digit surge in crude prices. A hot war, however, between the US and Iran could be an entirely different matter. Tehran has repeatedly threatened to shut down the Strait of Hormuz in the event of an outright conflict with America and its Arab allies. The chokepoint is an obvious target. Over 18 million...

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Insight Conversation: Carole Nakhle, Crystol Energy

Carole Nakhle, CEO of independent consultancy Crystol Energy and founder of Access for Women in Energy, spoke to Paul Hickin about energy transitions and shifting oil and gas politics. How do you see the energy mix changing in the next decade? The global energy mix is unlikely to look much different from today. The lion’s share will continue to be provided by fossil fuels – that is coal, oil and natural gas, accounting for more than 85%. The rest will come from energy that does not emit CO2,...

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Crude supply imbalances slash Brent premium in wake of Venezuela sanctions

Premium quality crude oil barrels are currently at some of their cheapest ever levels in the global market, with supply imbalances causing quality spreads to narrow significantly and for sustained lengths of time. Derivatives of light, sweet Brent crude have fallen to record lows versus Dubai derivatives traded on the Intercontinental Exchange in recent weeks. All things being equal, a sour crude grade (with higher sulfur content), or one with a yield of more bottom-of-the barrel...

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Russia’s OPEC alliance brings risks and rewards for Putin

OPEC still needs Russia to prop up oil markets, but the arguments for an even closer relationship with the cartel are weakening. The Kremlin’s two-year-long alliance with the 14-member group has been useful up to a point. On the one hand, oil diplomacy has helped to bolster President Vladimir Putin’s growing regional ambitions in the wider Middle East. On the other, Russia’s economy has also benefited from higher prices buffing up Putin’s financial credentials and popularity at home. Russia’s...

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Geopolitical tremors mean a choppy outlook for oil in 2019

Get used to more scary oil market volatility in 2019. This is the message coming from leading industry strategists and forecasters after a bruising end to last year, when Brent crude dipped below $50/b. Although the benchmark has recovered along with major global stock markets, forecasters are concerned about the prospects of a sustained rebound. Unpredictable geopolitical upheavals like Brexit and US President Donald Trump’s trade wars are expected to weigh more heavily on sentiment than the...

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Saudi Arabia’s spending addiction is bad for oil markets

Saudi Arabia cannot continue living beyond its means indefinitely. The kingdom is projecting another hefty budget deficit this year after crude prices plummeted by about than 40% since last October. Until the Arabian petrodollar states learn to tighten their belts, oil consumers will remain vulnerable to their economic mismanagement. Saudi Arabia is doubling down on domestic spending despite falling oil revenues. Amid a volatile start to 2019 for crude markets, Riyadh is persisting with a...

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Oil policy twists and turns in 2018 – the Capital Crude top 10

There were 56 episodes of Platts’ Capitol Crude podcast this year, covering nearly everything US oil policy touched from Boulder, Colorado to Beijing, China. Here are 10 of our favorite episodes from 2018: February 20 – Free at last! Just days after leaving his position as a top energy policy adviser to President Trump, George David Banks stopped by the podcast for a lengthy chat on what he described as a chaotic year in the White House. “Free at last,” he declares at the end of this...

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Qatar’s OPEC exit could backfire on LNG superpower

Qatar’s reasons for exiting OPEC look muddled. The tiny Persian Gulf sheikhdom says it wants to concentrate on building on its position as the world’s biggest exporter of liquefied natural gas (LNG) instead of being a minor player in an oil cartel dominated by Saudi Arabia. Aside from saving on membership fees, leaving the group has few benefits and many risks. Politics had nothing to do with the decision, which came as a complete surprise to OPEC and its allies, according to Qatar’s new...

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