What We Read Today 01 December 2014

Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary “reading list” which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for “reading list” items are gratefully reviewed, although sometimes space limits the number included.

• At current prices Bakken and Permian Basin are in the red (Walter Kurtz, Sober Look) The sharp price drop for oil following the OPEC decision not to reduce production has put the price of oil below the production cost for two of America’s largest oil fields.

Kurtz quotes Scotia Bank cost estimates for Bakken (North Dakota) at $69 and Permian (Texas) at $68. (Note: Not all estimates agree with those from Scotia Bank – see next article.) The U.S. oil price (WTC- West Texas Intermediate Crude) starts the week at $66. If oil stays at this level or lower it is likely that drilling will stop in these two high producing fields and within a year production will likely decline by more than 50% from these sources that currently produce more than a quarter of all U.S. oil (Permian 15% and Bakken 13%). Kurtz suggests that the U.S. government could support this production by building the U.S. petroleum reserve but it would have to buy above market (somewhere in the $70s) to keep Bakken and Permian drilling continuing. But how long that could continue is in doubt. See Oil at $40 Possible as Market Transforms Caracas to Iran (Gregory Viscusi, Tara Patel and Simon Kennedy, Bloomberg). See also next article.

• OPEC Gusher to Hit Weakest Players, From Wildcatters to Iran (Bradley Olson and Rebecca Penty, Bloomberg) While some U.S. producers are likely to cut back on (or stop completely) new drilling, there are many areas in the world with even higher production costs which will be hard hit if prices remain in the $60s or move lower. This article lists OPEC members Iran, Iraq, Venezuela and Nigeria plus non-OPEC countries Russia and Norway who cannot afford to produce oil below $70. The same is true for Canada’s tar sands bitumen production. Note: Differing from Scotia Bank in the preceding article, this article quotes the U.S. EIA (Energy Information Administration) to provide a production cost estimate for the Bakken shale below $42.

• Near-collisions between drones, airliners surge, new FAA reports show (Craig Whitlock, The Washington Post) This issue hasn’t been in the headlines but as soon as one of the near misses isn’t a miss it will be. Then Congressional politicians and others will demand to know why the accident wasn’t prevented. But right now all these then-to-be-outraged people are too busy eating turkey to be bothered with this.

• Articles about events, conflicts and disease around the world

Ferguson

Was Michael Brown surrendering or advancing to attack Officer Darren Wilson? (Sandhya Somashekhar and Kimbriell Kelly, The Washington Post) See witnesses’ one liners below:

Case: State of Missouri v. Darren Wilson (Transcript of: Grand Jury Volume V – Date: September 16, 2014)

Ferguson mayor: No severance pay for Wilson (USA Today)

In Ferguson’s Violence, Small Business Owners Are the Biggest Losers (Bloomberg Businessweek)

A deafening liberal silence on Ferguson (Al Jazeera)

Ferguson demonstrators begin 120-mile march to Missouri state capital (Reuters)

Ferguson a defining moment for race relations in USA (USA Today)

Ebola

After the Ebola Zone: The Life of a New York Doctor In Quarantine (Bloomberg Businessweek)

Ebola Rages in Sierra Leone as UN Misses Curbing Targets (Bloomberg)

Israel

Gaza floods: UN declares state of emergency (BBC News)

Somalia

Blast in eastern Kenya wounds one: police (Reuters) More chaos spills over border from Somalia.

Egypt

Mubarak verdict fuels protests, mockery in Egypt (Reuters)

Syria

Thirty U.S.-led strikes hit Islamic State in Syria’s Raqqa: monitoring group (Reuters)

Iraq

Iraqi army ‘had 50,000 ghost troops’ on payroll (BBC News)

Iraq’s divisions will delay counter-offensive on Islamic State (Reuters)

Ukraine

Ukraine in maps: How the crisis spread (BBC News)

Russia

Thousands protest against Russian health cuts (BBC News) Russia’s budget is under pressure from Western sanctions and low oil prices.

The Russian Rouble Is Collapsing To New Record Lows (Business Insider)

Bulgarians see Russian hand in anti-shale protests (Financial Times) Fear of Kremlin “empire” designs.

Moldova

Moldova votes in ‘EU v Russia’ election (BBC News)

Switzerland

Swiss voters reject immigration cap (Al Jazeera)

Swiss Voters Reject Initiative on Central-Bank Gold Would Have Forced Central Bank to Hold a Fifth of Its Assets in Gold (The Wall Street Journal)

Afghanistan

Kabul police chief quits after South African family dies in Taliban attack (Reuters)

Colombia

Colombian General Alzate freed by Farc rebels (BBC News)

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