Written by rjs, MarketWatch 666
Here are some more selected news articles about the oil and gas industry from the week ended 12 September 2020. Go here for Part 1.
This is a feature at Global Economic Intersection every Monday evening.
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GOP Proposes Letting Fossil Fuel Firms Sue Sick Workers Seeking Compensation – Alexis Goldstein – Fossil fuel firms have long argued that addressing climate change will kill jobs – but the main entities killing oil and gas jobs lately have been fossil fuel firms.Rather than save jobs, oil firms have lined executive pockets just before declaring bankruptcy, and announced layoffs rather than cut into shareholder profits. Some oil workers are even dying on the job – and instead of increasing safety and transparency, oil companies have pushed Congress to make it impossible for workers and families to sue if they get sick due to unsafe conditions.We have seen this pattern before with the coal industry, which has long fought efforts to fund benefits to workers who contracted “black lung” in mines. Now, it’s oil and gas firms that are putting profits ahead of the lives of their own workers.The response of fossil fuel firms and the Trump administration alike to the potentially lethal working conditions for oil and gas workers has been to bury the data and prevent workers from suing. Fossil fuel giants like ConocoPhillips and Exxon lobbied Congress to grant them legal immunity should their workers get sick, as documented by Friends of the Earth. The liability shield proposed by Senate Republicans even allows firms to sue their own workers should they try and seek recompense if they get sick.
Crude oil pipeline expansion in Texas is canceled – Midstream operator Enterprise Products Partners LP on Wednesday announced it was scrapping its Midland to ECHO 4 pipeline expansion project in Texa, Kallanish Energy reports. The project was designed to move 450,000 barrels per day from the Permian Basin of West Texas and New Mexico to the Gulf Coast. The expansion project would have linked Midland in West Texas with Enterprise’s ECHO terminal in Houston, Texas. The cancellation comes as crude oil producers in North American have slashed production due to low prices and that has reduced demand for new pipeline capacity. Enterprise Products Partners said it has amended some contracts with customers to allow them to transport crude oil in its existing pipelines in the near term while extending the overall duration of the agreements. Last April, the company had pushed back the completion date for the project by six months to the second half of 2021, as part of a $2.1 billion cut to its 2020 budget. The company said the cancellation will reduce growth capital in 2020-2022 by about $800 million. The decision will also result in a $45 million impairment charge to third quarter 2020 earnings later this year, it said.
Oil Companies Rely On Controversial Firm To Rebut Colorado Health Study – One day after Colorado health officials briefed a state rulemaking panel on the potential health risks posed by oil and gas drilling, industry groups brought in an expert of their own to downplay the state’s findings – and her comments were blunt. “My expert conclusion is that there’s no credible, causal evidence that current setback distances need to be extended in order to minimize adverse health impacts,” Tami McMullin, who previously served as a state toxicologist, told members of the Colorado Oil and Gas Conservation Commission in a Sept. 4 hearing.Since 2018, McMullin has worked as a senior toxicologist for the Center for Toxicology and Environmental Health, an Arkansas-based consulting firm with a long history of working closely with the fossil fuel industry – and an equally long history of controversy during which its work has drawn conflict-of-interest accusations.McMullin’s comments to the COGCC came on behalf of the Colorado Oil and Gas Association ahead of a pivotal decision by the commission on whether, and by how much, to extend mandatory “setback” distances between occupied buildings and new wells. Industry groups are staunchly opposed to increased setbacks, and testimony submitted to state regulators in advance of the rulemaking included a private study “prepared for” COGA by McMullin and other CTEH researchers to help bolster their case.
Advocates: 2020 presidential election presents clear choice on energy for Colorado, US –The outcome of the presidential election will have a big impact on the energy front in Colorado a nd other oil- and gas-producing states.If U.S. voters decide to stay the course, the current push for energy dominance through increased drilling will continue. If they elect a new president, the challenger has pledged to end new drilling on public lands and move toward a carbon-free future.Whoever wins Nov. 3, any executive-branch attempts to change existing policy are likely to face legal challenges.Democratic challenger Joe Biden has vowed to immediately start addressing climate change if elected. The former vice president has a $2 trillion plan that includes expanding clean-energy jobs and greatly reducing fossil fuel emissions.President Donald Trump, who was officially nominated in late August as the GOP presidential candidate, has targeted oil and gas regulations he sees as burdensome to the industry.“There couldn’t be a more clear divide between the two perspectives about American energy production, particularly coal, oil and natural gas,” said Thomas Pyle, president of the American Energy Alliance, an advocacy organization that has endorsed Trump.President Donald Trump, third from left, with Energy Secretary Rick Perry, left, Shell Oil company President Gretchen Watkins, second from left, and Shell Pennsylvania Vice President Hilary Mercer, fourth from left, tour the Shell Pennsylvania Petrochemicals Complex in Monaca, Pa., on Aug. 13, 2019.A new poll released by the American Petroleum Institute-Colorado found that 57% of Colorado voters would be more likely to vote for a candidate who supports providing access to oil and gas produced in the United States. Still, given Colorado’s changing demographics, most political experts don’t expect Trump to win here. The president lost Colorado by 6 points in 2016, and a recent poll by Morning Consult – the same firm that did the API poll – showed Biden leading Trump 52% to 39% in Colorado. The two campaigns fundamentally differ on their stances toward drilling on federally managed lands. Roughly 36% of Colorado is federal land, and the state is the seventh-biggest energy producer in the country.Colorado is also considered a leader on renewable energy, with Gov. Jared Polis and legislators setting goals to cut greenhouse gas emissions and get to a 100% carbon-free electric grid.
More than 40 groups call for coronavirus protections for oil and gas workers – A coalition of more than 40 organizations is urging the federal government to take steps to protect workers at oil and gas facilities, as well as the communities surrounding the sites, from the coronavirus. In a letter to the Interior Department, Bureau of Safety and Environmental Enforcement (BSEE), Coast Guard and Occupational Safety and Health Administration (OSHA), the groups specifically call for monthly public reporting on COVID-19 testing and infection rates at oil and gas facilities. The coalition, which includes a number of environmental groups, also called for requiring companies operating the facilities to put forth coronavirus response plans and for the government to monitor and report on the implementation of these plains. The groups additionally asked OSHA to presume that some exposures are “work related” when reporting work-related illnesses. “The offshore oil industry presents a high risk for oil workers, as oil rig employees spend shifts working on site, sleeping and eating in tight quarters,” the groups wrote. “Onshore oil and gas workers, particularly those living in ‘man camps’ are also at risk from close contact on the job and in quarters.” “It is incumbent on federal regulators to investigate whether oil and gas operators are sanitizing workspaces, evacuating workplaces when necessary and adopting strict safety protocols such as temperature checks and frequent COVID-19 testing,” they added. Reports have shown that some oil and gas workers in the U.S. have tested positive for the virus. Meanwhile, other countries have seen significant impacts, including Mexico, whose state owned oil company has seen more than 200 employee deaths. The industry has also been hit by sinking prices because of a drop in demand linked to the pandemic. Asked for comment, Coast Guard spokesperson Brittany Panetta pointed The Hill to a March guidance issued by a regional office that has jurisdiction over the Gulf of Mexico coastline. The guidance states that operators “shall develop and be prepared to execute plans to evacuate offshore personnel exhibiting COVID-19 symptoms, and have them tested.” It says they are “reminded to report the illness…or death to their respective Coast Guard Sector Command Center.” OSHA and Interior, which oversees BSEE, didn’t immediately respond to The Hill’s request for comment.
Oil wells along Fort Berthold boundary subject of potential tax changes – More changes could be on the horizon regarding the way oil taxes are divvied up between the Three Affiliated Tribes and the state of North Dakota, as the tribe seeks revenue from all wells that straddle the boundary of the Fort Berthold Indian Reservation. Tribal Chairman Mark Fox, who has pushed to address this matter in the past, raised it again at a Friday meeting of the Tribal Taxation Committee at the state Capitol in Bismarck. At issue are 132 wells that begin outside the reservation and extend horizontally across the border. The tribe does not collect any tax revenue on those wells, as the money goes to the state. For wells that begin on the reservation and then cross the border, both the tribe and state share in tax revenue. Fox would like to see the tribe collect taxes from all wells at the border, not just the ones that begin on Fort Berthold. He told committee members, which include state lawmakers and the governor, that the issue is a matter of “realizing revenue for our government, just like you do for the wells that go both ways.” “The longer we wait, the more we lose,” Fox said. “That’s really a strong concern that we’ve got, that this needs to be resolved ASAP.” For wells that begin on the reservation and cross the boundary, the proportion of tax revenue that goes to the tribe and the state depends on whether the well passes trust or fee land. Trust land is held by the federal government in trust for the benefit of the tribe, and fee land refers to private land within a reservation. A major tax agreement struck in 2019 changed the percentage of taxes allocated for new wells drilled on Fort Berthold, depending on which type of land the well crosses. As committee members discussed the issue Friday, a potential solution emerged in which the tribe collects taxes on all wells that cross the border, but possibly not on the portion of a well that extends outside the reservation. Fox acknowledged that a solution might involve a “give and take,” in which the tribe loses some tax money collected on wells that reach land outside the boundary. He indicated that the tribe is researching how this matter is handled on oil-rich Indian reservations in other states. He said he would also like to see data showing how much money went to the state, historically, that could have gone to the tribe had an agreement been reached earlier allowing the tribe to share in tax revenue from wells that begin off the reservation.
Land Board again pushes back gas royalty payment deadline – The North Dakota Board of University and School Lands voted Wednesday to further push back the deadline dozens of oil patch companies face to pay the state for deductions taken from natural gas royalties.If a company wants to avoid penalties and owe just minimal interest, they must now pay by April 30, 2021. The money originally was due this past springuntil the Land Board voted to delay the deadline until Sept. 30 amid the oil downturn brought on during the coronavirus pandemic.Following a North Dakota Supreme Court ruling last year favorable to the state, officials estimated the state is owed tens of millions of dollars from companies that applied deductions for royalties stemming from mineral development on state-owned land. Royalty money collected by the state benefits education and public institutions. Gov. Doug Burgum suggested delaying the payment deadline againat the last Land Board meeting in August amid ongoing challenges facing the oil industry as low demand keeps oil prices down. Some oil producers are undergoing bankruptcy proceedings, and they face uncertainty over the Dakota Access Pipeline, he said Wednesday. A federal judge ordered the pipeline to stop operating this summer and although a higher court overruled that decision, litigation is ongoing. There also is uncertainty surrounding potential changes to the quality of natural gas accepted onto the Northern Border Pipeline, a major exporter for Bakken gas, Burgum said.”Things are perhaps not better; they may be worse than they were last spring,” he said.The Land Board voted unanimously to extend the deadline again following Wednesday’s discussion, which took place in part during a closed session as the matter involves litigation.
PIPELINES: Tribes renew push to shutter Dakota Access — Wednesday, September 9, 2020 — Native American tribes opposing the Dakota Access pipeline are making a second bid for a federal court to shut down the crude oil pipeline.
Alaska Native tribes and 15 U.S. states file suits to stop oil drilling in Arctic refuge – Anchorage Daily News – Three Alaska tribal entities on Wednesday sued the Trump administration to stop the federal government’s first-ever oil and gas lease sale in the coastal plain of the Arctic National Wildlife Refuge. The Neets’aii Gwich’in tribes of Venetie and Arctic Village named Interior Secretary David Bernhardt and several federal agencies in the suit, filed in federal district court in Alaska. The Native Village of Venetie Tribal Government, the Arctic Village Council and the Venetie Village Council, represented by the Native American Rights Fund, filed the lawsuit to protect important traditional resources there, such as the caribou that are sought after by subsistence hunters. They challenge Bernhardt’s signing last month that finalized a plan that puts all available land, or 1.6 million acres in the coastal plain, on the table for possible leasing after Congress in 2017 agreed to open the area to drilling.
Washington leads suit against Arctic Refuge drilling -Washington will lead a coalition of 15 states challenging the Trump administration’s decision to open the Arctic National Wildlife Refuge for oil and natural gas production. State Attorney General Bob Ferguson said Wednesday a federal lawsuit filed in Alaska contends the decision to drill on the Coastal Plain violates federal laws, including the Administrative Procedures Act, which has been a basis of other successful suits he has filed. It also claims the decision violates the National Environmental Protection Act with a flawed environmental review. Opening the refuge to drilling is the latest example of president Donald Trump’s “assault on our environment,” Ferguson said. It would harm Washington by exacerbating the effects of climate change and devastate birds that migrate through the state, the lawsuit contends. Washington would also be impacted by refining the oil extracted in the refuge, increasing the risk of spills and potential worker hazards, it adds. Trump and his administration “unlawfully cut corners in their haste to allow drilling in this pristine, untamed wildlife refuge to oil and gas development,” Ferguson said in a news release announcing the lawsuit. An indigenous people’s community on the Coastal Plain also has filed suit against the plans to open the area to drilling. Interior Secretary David Berhardt announced in mid August the administration would open all 1.5 million acres of the Coastal Plain to oil and gas leasing, calling it “a new chapter in energy independence” and a way to generate thousands of jobs. Congress had mandated the leases, he said.
The Upcoming Release of Crude Oil from the Strategic Petroleum Reserve |- As the year 2020 wears on, it seems that every month brings a new surprise. In August, in addition to the ongoing pandemic and protests, a major hurricane was added to the mix. What comes next is anybody’s guess. A zombie apocalypse? An alien invasion? At this point, the possibilities seem boundless. And the energy industry has been no stranger to this year’s turmoil, what with COVID-related demand destruction, an oil-price collapse, and production shut-ins. Amidst the chaos, the Department of Energy (DOE) announced that for the first time, private-sector energy companies would be allowed to store crude oil in the U.S.’s Strategic Petroleum Reserve (SPR), which resulted in the leasing of 23 MMbbl of capacity. Recently, those volumes have begun to be drawn back out. Today, we examine the factors influencing movements of crude oil into and out of the U.S. SPR. April was quite a month for crude oil, complete with the price of WTI dropping to unprecedented levels – even going negative for a day, as we discussed in One Way Out. Even before the bottom fell out though, in early April, the DOE was scrambling to cope with the fallout of the OPEC+ price war and rapidly deteriorating global crude demand due to COVID (see Things That Matter). In an attempt to stymie further price shocks and stabilize the market by absorbing some of the oil glut, the Trump administration directed the Secretary of Energy, Dan Brouilette, to fill up the SPR. To comply, the DOE announced on April 2 that it would lease up to 30 MMbbl of crude storage space in the SPR to private energy companies for the first time. It was a stunning decision to many in the industry; however, given the abundance of unceasing surprises which have occurred this year, this action was quite fitting with the what’s-next uncertainty that has ensued in 2020. The U.S. SPR is the largest emergency stockpile of crude oil in the world, with an authorized capacity of 714 MMbbl. It was established in the mid-1970s in response to the 1973 oil crisis to mitigate domestic supply disruptions. In the past few decades, it has been used to store crude for a rainy day – that is, to help deal with unpredictable events such as embargoes or devastating hurricanes that interrupt supply. There are currently four storage sites in operation. Moving from west to east in the map in Figure 1 below, they are:
Never Say Goodbye, Part 3 – Will Rebounding Canadian Crude Production Fill Up Pipelines? –Western Canadian producers have been deeply impacted by lower crude oil prices and the demand-destroying effects of COVID-19. This past spring, oil production in the vast region dropped by an estimated 940 Mb/d, or as much as 20% from the record highs earlier this year. Taking that much production offline helped in at least one sense: it eased long-standing constraints on takeaway pipelines like Enbridge’s Canadian Mainline, TC Energy’s Keystone Pipeline, and the government of Canada’s Trans Mountain Pipeline. Production has been rebounding this summer, however, and there are indications that pipeline constraints may be returning and apportionment of uncommitted space on some pipes may again become a persistent issue. Today, we continue a review of production and takeaway capacity in Alberta and its provincial neighbors with a look at apportionment trends on the biggest pipelines. As we explained in Part 1 of this series, oil producers in Western Canada responded to sharply lower oil prices and lower demand by reducing production by 940 Mb/d between February and the peak of the cutbacks in May. Three-quarters of the cuts occurred in Alberta’s oil sands in response to single-digit pricing for the heavy oil price benchmark of Western Canadian Select (WCS) during April. However, WCS prices recovered steadily through May and June, and have since been holding steady between $30/bbl and $35/bbl (all in U.S. dollars). As a result, production has begun to recover: we estimate that about half of the 940 Mb/d supply reduction had been restarted by early July, and there are indications that production has continued to rise as the summer wears on. In Part 2, we discussed how the sudden shifts in Western Canadian oil production have been affecting the region’s takeaway pipelines. It’s no secret that, despite the midstream sector’s best efforts to bring new pipeline capacity online, midstreamers failed to keep pace with production growth in the oil sands and other production areas through much of the 2010s. (See The Shape I’m In, How Long, and Canadian Pipedream for details.) The end result – at least until the production slowdown this spring – has been too many barrels competing for too little pipeline space.
Ukraine gas company to add Rick Perry pick to board – The Ukraine state-owned natural gas company caught up in President Donald Trump’s impeachment investigation has appointed a U.S. businessman pushed by former Energy Secretary Rick Perry to its board, two people with direct knowledge of the decision told POLITICO on Thursday.Houston-based oil and gas executive Robert Bensh is set join the board of Naftogaz, pending final paperwork, the two people said, adding that his appointment has drawn opposition from some other board members. They said the move has led at least one of them, Amos Hochstein, to prepare to resign.m The Ukraine government informed Naftogaz last week that it had approved Bensh, two people with knowledge said. The appointment adds to questions about Perry’s role in Ukrainian energy politics and whether the former Texas governor had pressured the government there to buy U.S. energy supplies to win favor with the Trump administration. Perry, as first reported by POLITICO, had originally pushed Naftogaz to accept Bensh and another Perry associate, Texas oil and gas executive with ties to Ukraine, Michael Bleyzer, onto its board.
Rick Perry’s Ukrainian Dream – Rick Perry came to Washington looking for a deal, and less than two months into his tenure as energy secretary, he found a hot prospect. It was April 19, 2017, and Perry, the former Texas governor, failed presidential candidate and contestant on “Dancing With the Stars,” was sitting in his office on Independence Avenue with two influential Ukrainians. “He said, ‘Look, I’m a new guy, I’m a deal-maker, I’m a Texan,’” recalls one of them, Yuriy Vitrenko, then Ukraine’s chief energy negotiator. “We’re ready to do deals,” he remembers Perry saying. The deals they discussed that day became central to Ukraine’s complex relationship with the Trump administration, a relationship that culminated in December with the House vote to impeach President Donald Trump. Perry was a leading figure in the impeachment inquiry last fall. He was among the officials, known as the “three amigos,” who ran a shadow foreign policy in Ukraine on Trump’s behalf. Their aim, according to the findings of the impeachment inquiry in the House, was to embarrass Trump’s main political rival, Joe Biden. Alongside this political mission, Perry and his staff at the Energy Department worked to advance energy deals that were potentially worth billions of dollars to Perry’s friends and political donors, a six-month investigation by reporters from Time, WNYC and ProPublica shows. Two of these deals seemed set to benefit Energy Transfer, the Texas company on whose board Perry served immediately before and after his stint in Washington. The biggest was worth an estimated $20 billion, according to U.S. and Ukrainian energy executives involved in negotiating them. If this long-discussed deal succeeds, Perry himself could stand to benefit: In March, three months after leaving government, he owned Energy Transfer shares currently worth around $800,000, according to his most recent filing with the Securities and Exchange Commission. Perry appears to have stayed on the right side of the law in pursuing the Ukraine ventures. Federal prosecutors in the Southern District of New York, or SDNY, questioned at least four people about the deals over the past year, according to five people who are familiar with the conversations and discussed them with our reporting team on the condition of anonymity. “As far back as last year, they were already interested in events that had taken place in Ukraine around Rick Perry,” including allegations that Perry “was trying to get deals for his buddies,” says one of the people who spoke to the Manhattan prosecutors. Perry is not a target of their investigation, according to two sources familiar with the probes. But two ethics experts say Perry’s efforts were violations of federal regulations. Administration officials are not allowed to participate in matters directly relating to companies on whose board they have recently served. Other experts say Perry and his aides may have broken a federal rule that prohibits officials from advocating for companies that have not been vetted by the Commerce Department. “Even if it skirts the criminal statute, it’s still unethical,” says Richard Painter, the top ethics lawyer in the White House of President George W. Bush, with whom we shared our findings.
Mexico Is Cutting Pemex’s Oil Output Forecast in Latest Setback – Mexico is cutting its 2021 forecast for oil production at Petroleos Mexicanos by 8.4% as the state producer struggles under a $107 billion debt load and the impact of the deadly coronavirus. The country’s Finance Ministry lowered its preliminary estimate for output next year to 1.857 million barrels a day, down from 2.027 million in an April forecast, according to a draft of next year’s budget proposal obtained by Bloomberg News. Pemex, as the company is also known, has been hit hard by Covid-related deaths among its workers at a time when the oil-market crash only made the ambitions of Mexican President Andres Manuel Lopez Obrador to increase production more difficult. Even the revised output number looks “optimistic,” said [one analyst]. “It seems that they have not learned,” he said, predicting that Pemex will fail to meet the lower target. The Finance Ministry estimates oil prices will average $42.10 a barrel next year, up from a preliminary forecast of $30 a barrel at the start of April. The numbers are part of a budget proposal that would increase Pemex’s spending by just 0.6% next year, to 544.6 billion pesos ($25 billion).
Mexico to present projects open to private capital as it moves to undo energy reform | S&P Global Platts – Mexico will present a set of infrastructure projects in the energy sector where private companies will be invited to participate, while it prepares to undo the energy reform conducted by the previous administration. Stay up to date with the latest commodity content. Sign up for our free daily Commodities Bulletin. Sign Up Mexico will announce a set of infrastructure projects before Sept. 15, when Mexicans celebrate Independence Day, President Andres Manuel Lopez Obrador said Sept. 7. The joint plan between the government and the private industry to reactivate the economy had originally been announced in November. According to a presentation filtered to the press, which presumably originated in the office of the presidency, the government’s announcement will consist of 168 projects worth roughly $44.4 billion where the private industry will provide over 50% of equity. The announcement comes at a time when lawmakers from the president’s party prepare to discuss a series of changes to the constitution that would effectively undo the energy reform carried out by former President Enrique Pena, which opened up the sector to private investment after over seven decades of monopoly. Senators from Morena, the party formed by the president and which currently has majority in both Houses of Congress, will discuss modifications to undo the 2013 energy reform, according to the party’s legislative agenda for the next period, which began on Sept. 1 ends in January. The plan includes changes to Mexico’s Hydrocarbon’s law, Pemex’s internal rules, the law of the energy regulators and the law for hydrocarbon revenues, the agenda shows. The main goal of the modification is to strengthen Pemex and CFE, the state hydrocarbon and power companies, respectively, for them to become economic engines for the country, the president has repeatedly said. The energy reform allowed private companies to participate in all areas of the energy sector for the first time in over 70 years and attracted over $200 billion in committed investments, including power generation and oil exploration. Lopez Obrador has touted with the idea of modifying the constitution to undo the energy reform for many years and even used it as a presidential campaign promise. Yet since he took office in December 2018, he promised to wait until his third year in office to do so. Sources have told Platts in recent months they see limits to the changes the current administration can make, because modifying many laws is a complex political process that needs coordination and therefore many of them expected the changes next year, after next year’s elections, which could add strength to the president’s party. In July, Mexico will renovate the lower House of Congress as well as 13 out of the 32 governorships in the biggest election process in modern history. Sources have also said undoing the reform is hard because many of the rules of the market are also included in the recently signed United States-Mexico-Canada Agreement.
Mexico Shuts The Door To Foreign Oil Companies -There will be no new exploration and production contracts on the table for private or foreign companies in Mexico under a government plan set to be made public soon.“We don’t expect that there will be anything new in exploration and extraction in this infrastructure plan,” the head of Mexico’s oil industry association AMEXHI toldReuters in an interview.The infrastructure plan is the Mexican government’s attempt to stimulate economic growth, but according to AMEXHI’s head, Merlin Cochran, it will not involve a focus on the energy industry in the form of new projects. New joint ventures for Pemex are also unlikely, Cochran told Reuters.Earlier this week, it emerged that Mexico might have to cut its production target for 2021 as total output continued to fall steadily. President Andres Manuel Lopez Obrador has ambitious plans for reversing this fall, but this plan relies exclusively on state player Pemex, and the company has probably the highest debt pile in the oil industry, despite government efforts to help it prop up its finances. This has made the target of 2 million bpd even harder to achieve.According to government plans, Pemex was supposed to boost oil production by about half a million barrels in 2021. Instead, in July production fell to 1.54 million bpd because of a sharp drop in the output from Pemex’s largest offshore field, Maloob. Output from Maloob fell by more than 30 percent on the year. This meant Pemex’s total for July fell to a record low. Earlier this year, there were media reports that the Mexican state company would farm out some production to foreign companies. The head of the National Hydrocarbons Commission, the state industry regulator, said he expected farm-out deals to be announced soon. However, this has not happened to date even though, according to NHC’s Rogelio Hernandez, Pemex was actively looking for partners.
PdV sees no spill risk from floating storage vessel – The Venezuela-flagged floating storage tanker Nabarima is in sound operating condition and poses no risk of an oil spill, according to PetroSucre, an offshore joint venture controlled by Venezuelan state-owned PdV.The Nabarima, a small VLCC built in 2005, has been moored for a decade at the offshore Corocoro field in eastern Venezuela’s Paria Gulf where it is used to store PetroSucre’s production of 23°API crude. The joint venture’s operations have been suspended since last year, leaving the storage unit at close to its full capacity of about 1.2mn bl.”Representatives of the National Aquatics Institute (INEA) have boarded (the Nabarima) on different occasions to certify its optimum conditions,” PetroSucre said in a 5 September statement. The last such visit was on 16 August, the company noted.PetroSucre workers reported early last week that the vessel was listing because of water flooding in the engine room and nearby compartments.Italy’s Eni, which holds a 26pc stake in PetroSucre, said later in the week that the vessel had been stabilized, but the crude aboard would be transferredinto another tanker, once the US provided a “green light” to ensure sanctions compliance.PetroSucre dismissed complaints by workers on and off the unit as false information intended to hurt Venezuela’s national oil industry and justify US sanctions.
Total to drop control of sensitive offshore Brazilian exploration blocks – – Total has decided to resign its operatorship of five exploration blocks, in the environmentally sensitive the Foz do Amazonas Basin, 120 km offshore Brazil, the French oil major said Sept. 7. Total said it notified its partners BP and state-run Petrobras of its decision on Aug. 19 of blocks FZA-M-57, FZA-M-86, FZA-M-88, FZA-M-125 and FZA-M-127. No reason was given for the decision but exploration projects in Foz do Amazonas have been facing strong resistance from environmental groups following the discovery of a previously unknown coral reef in the turbid waters of the Amazon River delta. Total has been looking to drill seven exploration well on the acreage in the area in a long-running struggle to secure approval from Brazilian federal environmental regulator IBAMA. Total first started licensing the exploration drilling project in 2014. The move also comes amid rising public sensitivity over new oil exploration. BP last month pledged to undertake no new oil exploration in new countries as part of its transition to cleaner energy. Total said it now has six months to appoint a new operator for the blocks, which it was awarded in 2013. Until then, Total said it has a duty to continue monitoring all regulatory processes on behalf of its partners Petrobras and BP. Total’s portfolio in Brazil currently includes 24 blocks, with 10 operated. In 2019, its production in the country averaged 16,000 b/d.
Tanker Delfi causes oil spill again – The work on raising and stabilizing the Delfi tanker (owned by Mister Drake PC) that sank near Odesa again caused an oil spill. “The leakage of oil products occurred due to the fact that the vessel continues to be raised and stabilized. The State Environmental Inspectorate will be able to calculate losses for environmental damage only after the Delfi tanker is finally removed from the Black Sea,” head of the State Environmental Inspection Andriy Maliovany wrote on Facebook on Friday. According to him, on Thursday, the State Environmental Inspection of Odesa region, examining the water area near the sunken ship, noticed spots and a gray slick of silvery color with a total area of 70 sq. m. Laboratory studies have shown an excess of normalized values of maximum permissible concentrations in water by 5.8 times. To promptly eliminate pollution, representatives of Odesa branch of the Ukrainian Sea Ports Authority carried out urgent work near the flooded tanker using a sorbent. As reported, the specialists of Cranship LLC on August 26, 2020 put the Delfi tanker sunken near Odesa beach on an even keel. In November 2019, the tanker Delfi under the flag of Moldova sank in the Odesa Gulf.
Huge anti-govt demonstrations held across Mauritius in wake of botched oil spill response – — Tens of thousands of Mauritians took to the streets of the capital to call for the resignation of Prime Minister Pravind Jugnauth and his cabinet for their botched handling of an oil spill which threatens the country’s economy. An estimated 75,000 people took to the streets of the capital Saint Louis over the weekend, the country’s largest anti-government protests in decades, following a slow and lackluster response to an oil spill in early August. The Japanese bulk carrier MV Wakashio struck a reef in southeast Mauritius and spilled roughly 1,000 tons of oil into the pristine Indian Ocean waters offshore the island. A 15 kilometer (9 mile) stretch of the coastline is now stained with oil as volunteers attempt to halt the spread of the slick. Environmental volunteers have erected makeshift oil barriers to stem the spread while experts from Japan and Britain are investigating the extent of the spill and its potential impact on the local flora and fauna, which include major mangrove forests filled with endangered species of animal. Meanwhile, some 34 melon-headed whales were found dead or seriously ill near the spill while the carcasses of roughly 40 dolphins are being examined for traces of oil in their system which may have contributed to their sudden and untimely deaths.
Mauritius oil spill ship operator to pay $9.4 million– The Japanese operator of a ship that leaked oil off the Mauritius coast pledged Friday to pay at least $9.4 million to help restore areas affected by the spill. Mitsui OSK Lines said in a statement that it planned “to contribute a total fund of about one billion Japanese yen over several years to support measures” to restore the marine environment. The measures include running mangrove and coral protection projects in partnership with experts and local NGOs, and setting up an environment recovery fund, it said. The company operates the MV Wakashio, which ran aground on July 25 off the coast of Mauritius, carrying 4,000 tonnes of fuel that began seeping into the island nation’s pristine, coral-filled waters. After the boat split in two, the larger piece was towed out to sea and sunk, but the smaller section remains stranded on the reef. More than 1,000 tonnes of oil is believed to have leaked from the ship, with the rest siphoned out before it spilled. The oil has affected mangroved areas that are complicated to clean. Both the operator and the vessel’s owner Nagashiki Shipping have apologised for the spill. Nagashiki last month pledged to “sincerely” respond to requests for compensation. It was not immediately clear if the funds promised by Mitsui would satisfy demands from the Mauritius government for compensation from the companies for “all losses and damages” caused by the spill and clean-up costs. Japan’s Foreign Minister Toshimitsu Motegi said last week the country would continue supporting recovery efforts. The accident is still under investigation by Mauritian authorities. Japan’s Kyodo News said last month the ship’s crew had steered it close to shore because they wanted to find a mobile signal so they could contact family and ask about the coronavirus situation at home. It cited an unnamed judicial source, who also said an alcohol-fuelled birthday party had been held on board before the accident, though it was not clear if on-duty crew participated.
No real danger of oil spill from burning oil Tanker, Sri Lanka Navy Says – There is no real risk of a spill from a fully loaded supertanker that caught fire off the east coast of Sri Lanka, a senior official in the Indian Ocean nation’s navy said on Friday. The fire that broke out in the engine room of the New Diamond on Thursday morning had spread to the bridge of the ship, carrying about 2 million barrels of oil, though it has not reached the cargo area, the Sri Lankan navy said. Director-General of Operations Rear-Admiral Y N Jayarathna told reporters it was the navy’s view that there was no real danger of a spill, because the fire on the ship has been contained in the rear section of the vessel. “The live flames have now died down and there is only white smoke emanating from the vessel,” he told a televised press conference. A navy spokesman, Captain Indika de Silva, said there were 23 crew on board, one of whom is presumed dead. The rest have been taken off the ship by the Sri Lankan navy, with one injured crew member flown to the capital Colombo for treatment. Three tug boats, five Sri Lankan navy ships as well as two craft from the Russian navy and three from the Indian navy have been assisting in an operation to fight the fire and tow the ship away from the coast, after it began drifting towards land. At present the vessel is being held by the salvage team in deep sea 35 kms (21.7 miles) east of the Sri Lankan town of Pottuvil, de Silva said. Initially, the ship was stranded 38 kms (24 miles) east of the town of Thirukovil, but drifted within 25 kms of the coast after being abandoned. Authorities were now towing it eastward, away from the coast, de Silva said.
Oil spill fears dissipate as fire almost doused on Sri Lankan coast – The fears of an oil spill due to a fire in a crude laden vessel off the Sri Lankan coast appears to have dissipated with the authorities on Sunday saying here that the blaze has almost been doused.While intense fire-fighting efforts taken up by the Indian Coast Guard and Sri Lankan Air Force and Navy since September 3 had led to localisation of the fire in the ship, a defence release said no oil spill has been reported.“Fire appears to be doused and no flame and smoke is visible.Situation is being monitored for further action,” the release said, adding that the inertness of cargo was being maintained.The ship’s storage area, which has about three lakh tonnes of crude oil, is reported to be safe.The Panama registered MT (Motor Tanker) New Diamond, a Greek owned vessel and under charter by Indian Oil Corporation was carrying 2,70,000 tonnes of crude oil from Kuwait to India’s Paradip port when its engine room caught fire off Sangamankanda’s coast in Lanka’s eastern district of Ampara.Indian Coast Guard (ICG) and Sri Lankan ships, fast patrol vessels and tugs have been deployed in the fire fighting exercise.The oil tanker, which was taken to safe waters, is being held by a tug about 42 miles from the nearest coast for preventing drifting of the ship and to facilitate fire fighting.The various assets deployed are equipped with fire extinguishers like Dry Chemical Power and Aqueous Film- Forming Foam Concentrates besides Oil Spill Dispersants and oil skimmers to handle the situation in the event of an oil slick.
Fire Breaks Out Again on Stricken Supertanker Offshore Sri Lanka Firefighters are again battling flames aboard a fully loaded oil supertanker off Sri Lanka, the island’s nation’s navy said on Monday, four days after fire first broke out on the New Diamond.“Fresh flames have risen in the funnel section of the MT New Diamond Supertanker and firefighters are battling the fire using foam to contain the blaze,” said the Navy spokesman Captain Indika de Silva, adding that the fire had not reached the oil cargo of around 2 million barrels.A fire first broke out last Thursday in the engine room and spread to the bridge of the very large crude carrier, chartered by Indian Oil Corp for importing oil from Kuwait. That blaze was doused on Sunday.Tugs had been spraying water onto the ship on Monday to keep the metal cool, but high winds ignited the flames once again, de Silva said.”We are spraying water on to the ship to keep it cool as there are several small fires still burning,” he said.Several tugboats surrounding the Very Large Crude Carrier (VLCC) are keeping it about 30 nautical miles, or about 58 km, east of Sangaman point – Sri Lanka’s easternmost point in the Ampara district.The supertanker is adrift and has to be held in position by the tugboats.Salvage operations are expected to begin shortly, but “the ship will be allowed to be moved out of Sri Lankan waters only with our permission”, de Silva said.
Sri Lanka towing stricken ship to deep sea, douses another fire (Reuters) – The Sri Lankan navy towed a stricken supertanker away from the Indian Ocean island’s east coast on Wednesday, while an Indian Coast Guard plane sprayed chemical dispersants on a long oil slick that trailed in its wake. A fire broke out in the engine room of the Greek-owned New Diamond tanker last Thursday. The blaze was believed to have been doused on Sunday but reignited a day later. Laden with 2 million barrels of crude oil, there are fears that the accident could cause an environmental disaster, but so far the slicks have resulted from escaping marine fuel oil rather than leaking crude. “This morning when we started moving the ship we noticed another slick trailing behind. It was about 1-2 nautical miles (1.8-3.6 kilometers), longer than the previous slick,” said Indika de Silva, spokesman for Sri Lankan Navy. The first slick, spotted on Tuesday, had been around a kilometer long. The slick, comprising marine fuel and residue from the fire, has been sprayed with chemical dispersants from a Dornier aircraft deployed by the Indian Coast Guard, de Silva said. Three members of a salvage team boarded the tanker on Wednesday to assess the damage, while a naval tug towed the vessel 41 nautical miles (76 kms) off Sri Lanka’s east coast. Greece-based Porto Emporios Shipping Inc is the registered owner of the 20-year old Panama-flagged very large crude carrier New Diamond, according to Refinitiv data. New Shipping Ltd is the manger of the vessel. There was no immediate comment from either company. Legal action would be filed against the owner under Sri Lankan laws protecting the marine ecosystem, Jagath Gunesekara, deputy general manager of the Marine Environment Protection Authority (MEPA) said. “We are deciding whether to claim criminal liability or civil liability or both,” Gunesekara said. Sri Lanka has deployed scientists and experts from MEPA, with one team examining the area around the ship and another surveying coastal areas for signs of pollution. “I have been informed there was some marine life, like turtles, closer to the incident, so this oil spill would have definitely damaged these species,” MEPA chairwoman Dharshani Lahandapura told Reuters.
Diesel fuel found in ocean near Sri Lanka oil tanker fire – An Indian coast guard aircraft sprayed a special chemical on a patch of diesel fuel near a large oil tanker off Sri Lanka’s coast where firefighters are battling a new blaze that broke out two days after an earlier fire was extinguished, the navy said. The MT New Diamond is carrying nearly 2 million barrels of crude oil and officials have warned of possible massive environmental damage to Sri Lanka’s coast if the ship leaks or explodes. Navy spokesman Capt. Indika de Silva said the new fire started Monday evening and reached the magnitude of the previous blaze. Firefighters have contained it but it is still burning, he said. High winds, extreme temperatures on the ship and sparks reignited it, the navy said, adding that so far there is no risk of a crude oil leak or of the fire spreading into the oil storage area. The navy said the initial fire began in an engine room boiler and did not spread to the oil storage area. However, it said “a diesel patch” had been spotted in the ocean about one kilometer (0.6 mile) from the ship. The patch is likely to be diesel fuel from the ship, it said. The ship has about 1,700 tons of diesel fuel to power its engines. An Indian coast guard aircraft sprayed a chemical on the patch to minimize damage to the marine environment, the navy said. Ships and helicopters from Sri Lanka and neighboring India are taking part in the firefighting efforts. The initial fire killed one Filipino crew member and injured another, but 21 other crew members escaped uninjured. Twenty were taken to the southern port city of Galle on Tuesday, while the captain remained on a ship near the tanker to help firefighting efforts, de Silva said. The tanker is about 30 nautical miles (55 kilometers) off the coast, the navy said.
Oil Supertanker Windfall Disappears — Just six months ago, oil supertankers experienced a windfall as the pandemic slashed demand for crude and traders raced to book vessels to store the resulting glut. Now that season of good fortune for those ships has all but vanished. The tankers, which can haul 2 million barrels of oil across the world’s oceans, are now earning just $6,103 a day on the benchmark route from the Middle East to China, Baltic Exchange data show. That’s the lowest since May 2018. Back in March, they could make $250,000 a day on the same journey. The boom-to-bust comes as the recovery in oil demand stutters and the OPEC+ alliance continues to curb output, reducing the need for tankers. At the same time, China, the world’s largest crude importer, has slowed its purchases following a buying binge when oil was cheap. “The demand that was pushed forward is now not showing up anywhere in the market,” said Peter Sand, chief shipping analyst at industry group BIMCO. “There’s still a little bit of floating storage around, and that storage is easing mostly,” weighing on rates, he said. To help improve rates in the short-term, vessels can slow down in order to limit availability. Renewed interest from traders to store oil at sea on a temporary basis could also provide a boost. Shipowners usually prefer the former when rates are low so that they can capitalize on any future improvement in earnings. For now though, the outlook doesn’t look much better. More ships are starting to come available as congestion begins to ease at China’s ports following the buying spree earlier in the year, “The return of vessels from floating storage and reduced port congestion is putting pressure on rates,” the analysts said. “We expect an improvement of crude oil trade will have to wait until oil stock levels have come down before OPEC+ opens its tap.”
Russia must regain – and increase – its oil market share when demand returns, energy minister says – Russia and other major oil producers must regain, and even increase, their share of the oil market once demand returns, Russia’s energy minister has said. “When demand begins to return to pre-crisis levels, it will be extremely important for Russia, like other oil-producing countries, to regain market share as soon as possible and, possibly, even increase it in the face of reduced competition between producers,” Russia’s Energy Minister Alexander Novak said in an article published in the ministry’s in-house magazine Tuesday. OPEC, Russia and other non-OPEC producers – a group known collectively as OPEC+ – are currently cutting output by 7.7 million barrels per day (bpd) until December. The energy alliance agreed to impose the production cuts in response to lower demand due to the coronavirus pandemic and the global economic downturn. From January 2021, the cuts are expected to taper further to amount to 5.8 million bpd, with these expected to last until April 2022. Producers aim to rebalance supply and demand in the unstable market, and to support oil prices. Russia and other major oil producers have found themselves ceding market share to U.S. shale producers in recent years, with the U.S. becoming the largest oil producer in the world in 2018. Wary of the damage that lower output is doing to its own oil industry, both to producers and its oilfield services sector, the Russian government is looking to support the sector and could launch a scheme to encourage (and offer tax incentives) to oil companies to drill several thousand oil wells with the idea being that the wells are left unfinished but can quickly be put into use after the OPEC+ deal ends in 2022. Novak said that “work is underway to create conditions for the formation of a stock of unfinished wells” but did not specify if the scheme had been approved by the government. Such a scheme is designed to support Russia’s oilfield services industry that focuses on services related to oil and gas exploration as well as the construction and maintenance of oil wells, for example. The industry employs 300,000 people in Russia, Novak said, and a lack of investment in the domestic industry could lead to mass redundancies, and it losing more market share to foreign companies.
Why Opec needs a plan to balance near-term prices against long-term market share – – It is easy to talk about when things return to normal. For the world oil market, there may be no such return. With demand still struggling, Opec needs a plan to balance short-term prices against long-term market share by the time its monitoring committee next meets on September 17.Various Covid-19 vaccines may be on the way, but doubts remain over the reliability of testing and their eventual efficacy.Meanwhile, the virus remains frustratingly resilient despite a fall in death rates. The growing rate of infections in India, Indonesia and Iraq appears unstoppable while Australia, Germany, Italy, Spain, Britain and, especially, France have registered a resurgence of cases after having managed to keep things under control.However, the US, Brazil and Iran were never really on top of the pandemic.Efforts to reopen schools and universities in many countries have led to a surge in new cases. Most office work continues remotely or at limited occupancy. As the US holiday season ebbs, these factors are causing a renewed slowdown in petrol demand. Air passenger travel is severely depressed, with continued confusion over regulations and the unpredictable appearance of quarantines and travel bans.Blanket lockdowns in most places will probably not return but rolling closures and depressed social and public activities continue. As companies run out of cash, temporary job losses become permanent and as government financial support winds down, many countries may now be entering a more conventional, shallower but still painful recession.China’s imports have been strong, although lower in July and August compared with the record hit in June, helping to support the market. But it is questionable how long this will continue as the country clears a backlog of deliveries bought when prices were weaker. Last month, the number of active US rigs began to increase after hitting its lowest level since 1940. The temporary shut-ins because of Hurricane Laura should shortly be reversed. Still, there is insufficient drilling to compensate for the fast declines in existing shale wells and the fall in US output will probably not be halted until next year, and until prices are above $50 per barrel.This points to the danger for Opec+ in assuming the pandemic is an aberration and that current policy only has to be maintained temporarily. To be fair to the group, it has laid out a path for sizeable but diminishing cuts of 5.8 million bpd against its baseline through next year and up to April 2022.
Oil Prices Face a Chill Autumn Wind – As the summer driving season fades in the rearview mirror, oil markets are taking on a distinctly chilly air.The recovery in demand has officially stalled, just as the OPEC+ countries are starting to taper their record output cuts. With spare capacity rife throughout the supply chain and huge stockpiles of crude and refined products, it may be some while yet before oil prices resume their upward path.After a strong initial rebound from the depths of the pandemic-induced slump, the comeback in demand slowed dramatically, as I’ve written hereand here. This is most obvious in those countries that publish detailed data at high frequency, such as the U.S., the U.K. and some other European nations.U.S. oil demand recovery has ground to a halt at around 85% of last year’s level That oil demand in India remains muted is particularly bad news for those wishing oil prices higher. Before Covid-19 struck, it had joined China as one of the major centers of growth in liquid fuel consumption. Sales of transport fuels by the country’s three biggest fuel retailers – Indian Oil Corp., Bharat Petroleum Corp. and Hindustan Petroleum Corp. – were still down year-on-year by more than 20% in July and August. The one potential bright spot is China, which may yet prove a lifeline for the flagging demand. July’s apparent oil use in the world’s biggest importer was up by a whopping 19.5% year on year, according to Bloomberg calculations on data from the nation’s Customs General Administration. Air travel in the country’s vast domestic market is picking up. Passenger numbers for China’s biggest airlines – Air China Ltd., China Eastern Airlines Corp. and China Southern Airlines Co. – were up by about 25%month on month in July. Travel analytics company ForwardKeys predicts air travel in China will fully recover this month. But China’s already got plenty of oil on hand. It took advantage of rock-bottom prices in March and April to make purchases, leaving the country’s stockpiles brimming, both on land and in tankers anchored off its coast. The volume in so-called floating storage is coming down, but there are still some 50 million barrels of crude that have been in tankers off China’s Shandong province for more than 15 days, according to London-based consultants Energy Aspects. When it comes to getting oil out of the ground, the spare capacity may be even bigger. While U.S. shale oil production may never recover fully to its pre-virus peak, there is still plenty of room for output to pick up from current depressed levels. In the seven shale basins covered by the Energy Information Administration’s Drilling Productivity Report, there were still more than 7,600 drilled but uncompleted wells at the end of July, a number that has barely changed since February. That may reflect a lack of activity in the shale patch, but the wells provide a buffer from when demand picks up to the point that drilling crews return to the Permian and other shale basins.
IEA sees oil market stuck between no major slowdown but stalled recovery – (Reuters) – The global economy is likely not headed for any major slowdown due to COVID-19 but piled-up storage and uncertainty over China’s oil demand cloud oil markets’ recovery, an official with International Energy Agency (IEA) said. Keisuke Sadamori, IEA director for energy markets and security, told Reuters the outlook for oil was in the midst of either a second wave or a steady first wave of the coronavirus. “There is an enormous amount of uncertainty, but we don’t expect any additional serious slowdown in the coming months.” “Even though (the market is) not expecting real robust growth coming back soon, the view on demand is more stable compared with three months ago,” he said in an interview. Crude prices LCOc1 CLc1 plunged in spring to historic lows as the pandemic’s lockdowns crushed demand, and have pared losses but remained stuck near $40 a barrel. The IEA cut its 2020 oil demand forecast in its monthly report on Aug. 13, warning that reduced air travel would lower global oil demand by 8.1 million barrels per day (bpd). The Paris-based agency downgraded its outlook for the first time in three months, as the epidemic continues to wreak economic pain and job losses worldwide. With Brent crude registering its first weekly loss since June on Friday, markets have grown increasingly nervous over demand, poor refining margins and slow economic growth, reducing incentives to draw crude and products from abundant stocks. “It doesn’t seem like a massive stock draw seems to be happening yet,” Sadamori said. “We are not seeing a robust pickup in refining activity, and jet fuel is the big problem,” he added. China, the world’s largest crude importer, emerged from an economic lockdown sooner than other major economies and used its financial muscle to make record oil imports in recent months, a rare bright spot amid global demand destruction. But geopolitical tensions could call into doubt “to what extent it can be sustainable and last long”, Sadamori said. “There are so many uncertainties with regard to the Chinese economy and their relationship with key industrialized countries, with the U.S. and these days, even Europe. It’s not such an optimistic situation – that casts some shadow over the growth outlook”.
Big trade houses see persisting oil stocks bubble – (Reuters) – Trading firms enjoyed an unprecedented boom in the first half of 2020 due to extreme volatility caused by the COVID-19 pandemic but the market’s direction now looks less certain due to high stocks and tepid demand recovery. “The market is more complex and nobody knows when demand will come back. Financial investors are piling into second half of 2021 or December 2021 (oil futures contracts) on the assumption demand will be back then,” Marco Dunand, chief executive of Mercuria Energy Trading, told Reuters. “Coming into the fourth quarter, the expectation was that we should be drawing 3 to 4 million barrels per day of crude and products from stocks but the market is not drawing that.” During the peak period of lockdowns in March and April, traders were forced to hastily store an additional 1 billion barrels of crude and refined products as oil demand cratered. Eventually, OPEC and other major producers announced record output cuts that helped oil prices rebound. Economic activity began picking up in June but the recovery has flatlined. Some possible COVID-19 vaccines are undergoing trials but meanwhile, countries have been forced to re-impose some restrictions to stop the spread of the virus. “We see people starting to do floating storage again … It will be a problem at some point as we have a massive overhang,” Dunand said. “Crude and distillate stocks in particular are building … It’s a bubble mess.”
Oil skids after Saudi price cuts, demand optimism fades – Oil prices dropped more than 1% on Monday after earlier hitting their lowest since July as Saudi Arabia made the deepest monthly price cuts for supply to Asia in five months while optimism about demand recovery cooled amid the coronavirus pandemic. Brent crude was at $42.21 a barrel, down 45 cents or 1.1% by 0439 GMT, after earlier sliding to $41.51, the lowest since July 30. U.S. West Texas Intermediate crude skidded 51 cents, or 1.3%, to $39.26 a barrel after earlier dropping to $38.55, the lowest since July 10. The world remains awash with crude and fuel despite supply cuts by the Organization of the Petroleum Exporting Countries (OPEC) and their allies, known as OPEC+, and government efforts to stimulate the global economy and oil demand. Refiners have reduced their fuel output as a result, causing oil producers such as Saudi Arabia to cut prices to offset the falling crude demand. “Sentiment has turned sour and there might be some selling pressure ahead,” Howie Lee, an economist at Singapore’s OCBC bank said. The Labor Day holiday on Monday marks the traditional end of the peak summer demand season in the United States and that renewed investors’ focus on the current lackluster fuel demand in the world’s biggest oil user. China, the world’s biggest oil importer which has been supporting prices with record purchases, slowed their intake in August, according to customs data on Monday. “Abundant supplies, fears of loosening OPEC+ compliance, the end of the U.S. driving season and stale long positioning have all combined to erode confidence in oil,” OANDA’s senior market analyst Jeffrey Halley said in a note. The world’s top oil exporter Saudi Arabia cut the October official selling price for Arab Light crude it sells to Asia by the most since May, indicating demand remains weak. Asia is Saudi Arabia’s largest market by region. In August, the OPEC+ group eased production cuts to 7.7 million barrels per day after global oil prices improved from historic lows caused by the coronavirus pandemic cutting fuel demand.
Oil Down After Saudi Price Cuts – — Oil extended its retreat below $40 a barrel after Saudi Arabia cut pricing for October crude sales as the summer driving season winds down with many countries still struggling to control the coronavirus. Futures in New York dropped 1.5% in Asian trading after Saudi Aramco reduced its key Arab Light grade by a larger-than-expected amount for shipments to Asia in a sign that fuel demand in the largest oil-importing region is wavering. The kingdom also lowered prices to the U.S. for the first time in six months. West Texas Intermediate, the American crude benchmark, fell 7.5% last week in its biggest loss since June amid nervousness over demand and a rout in stocks. While infection rates in the U.S. are slowing, the pandemic appears to be staging a comeback in parts of Europe and cases in India are still surging. After trading in a narrow range for the past three months, crude is off to a poor start in September amid a still-tepid demand backdrop and a continued increase in output from the OPEC+ alliance. Chinese crude imports fell for a second month in August, and the world’s biggest importer is expected to purchase much less in September and October than it did in May and June as independent refiners run out of quota after a buying binge earlier this year. A price correction is overdue and weakening margins for major fuels such as diesel may potentially become a concern, said Howie Lee, an economist at Oversea-Chinese Banking Corp. in Singapore. Any rally in prices will “face headwinds as long as crude oil inventories remain materially high,” he said. WTI for October delivery fell 1.5% to $39.19 a barrel on the New York Mercantile Exchange as of 7:48 a.m. in London after dropping 3.9% on Friday. It was down as much as 3.1% earlier on Monday. Brent for November settlement dropped 1.2% to $42.15 a barrel on the ICE Futures Europe exchange after declining 3.2% on Friday. Brent’s three-month timespread was $1.48 a barrel in contango – where prompt prices are cheaper than later-dated contracts — compared with $1.09 in contango a week earlier. The change in the market structure of the global crude benchmark indicates concern about over-supply is increasing.
Oil prices fall as fuel demand concerns grow after end of U.S. summer driving season – Oil fell below $42 a barrel on Tuesday, its 5th session of decline, pressured by concerns that a recovery in demand could weaken as coronavirus infections flare up around the world. Coronavirus cases rose in 22 of the 50 U.S. states, a Reuters analysis showed on the Labor Day holiday weekend. New infections are also increasing in India and Britain. Brent crude fell $1.28, or 3.05%, to trade at $40.73 per barrel. West Texas Intermediate crude dropped $2.07, or 5.2%, to trade at $37.70 per barrel. On Monday, crude fell after Saudi Arabia’s state oil company Aramco cut the October official selling prices for its Arab light oil, a sign demand may be stuttering. “The price weakness is continuing today,” said Eugen Weinberg, analyst at Commerzbank. “We believe this is attributable first and foremost to demand concerns.” Both oil benchmarks have dropped out of the ranges they were trading in throughout August. Brent has fallen more than 8% since the end of August. “The streak of losses is driven by a stalling crude demand outlook for the rest of the year,” said Paola Rodriguez-Masiu, analyst at Rystad Energy. Still, oil has recovered from historic lows hit in April, thanks to a record supply cut by the Organization of the Petroleum Exporting Countries and allies, known as OPEC+. The producers are meeting on Sept. 17 to review the market. Crude has also found support from a weaker U.S. dollar, although the U.S. currency was up on Tuesday. The market could rally beyond $45 later this year, said Norbert Ruecker, head of economics at Swiss bank Julius Baer. “Fundamentally, things have not changed,” he said. “Demand is recovering, supply remains constrained, and the storage overhang is slowly disappearing.”
Oil drops more than 7% to multi-month low on demand fears – Oil prices tumbled to their lowest level since June on Tuesday amid growing demand concerns as Covid-19 continues to spread. West Texas Intermediate crude, the U.S. oil benchmark, slipped $3.01, or 7.6%, to settle at $36.76 per barrel. During the session WTI traded as low as $36.13, a price not seen since June 15. International benchmark Brent crude dipped more than 5.3% to settle at $39.78, also its lowest level since June. “Today’s oil price move is a clear sign that the market now seriously worries about the future of oil demand,” said Paola Rodriguez-Masiu, senior oil markets analyst at Rystad Energy. “The streak of losses is driven by a stalling crude demand outlook for the rest of the year, with rising cases of Covid-19 and the end of the summer driving season in the U.S., as well as Asian refineries putting on [the] breaks,” she added. Since WTI plunged into negative territory in April for the first time on record, oil prices have staged a big comeback. WTI jumped nearly 90% in May, and has posted monthly gains ever since. The gains were, of course, on the back of record lows, but prices moved higher as international producers scaled back production in an effort to counteract the demand drop-off caused by the pandemic. But in recent sessions prices have begun to trend lower. WTI fell during Monday’s session after registering a 7.45% loss in the prior week, snapping a four-week win streak and posting its worst weekly decline since June. Tuesday’s move lower followed Saudi Aramco cutting its official selling prices for October, which RBC’s Helima Croft said triggered new demand concerns. In a recent note to clients, Bank of America said that it will take three years for demand to recover from Covid-19, assuming there’s a vaccine or cure. The firm believes peak oil will come as soon as 2030 due in part to electric car proliferation. Rising U.S.-China trade tensions, as well as production coming back online also pressured prices on Tuesday, as did a stronger U.S. dollar. “The market has its eye on the big picture: where and when we see demand normalize globally and what happens with both US production and OPEC+ agreement over the medium term,
Oil prices reverse some losses but demand concerns persist – Oil futures clawed back some of the losses they sustained in the previous session, but a rebound in COVID-19 cases in some countries undermined hopes for a steady recovery in global demand. Brent crude was up 44 cents, or 1.1%, at $40.22 a barrel after dropping more than 5% on Tuesday to fall below $40 a barrel for the first time since June. U.S. crude was up 50 cents, or 1.4%, at $37.26 a barrel, having fallen nearly 8% in the previous session. Both major oil benchmarks are trading close to three-month lows. The global health crisis continues to flare with coronavirus cases rising in India, Great Britain, Spain and several parts of the United States. The outbreaks are threatening to slow a global economic recovery and reduce demand for fuels from aviation gas to diesel. “Short-term oil market fundamentals look soft: the demand recovery is fragile, inventories and spare capacity are high, and refining margins are low,” Morgan Stanley said. Yet, the bank raised its Brent price forecast slightly higher to $50 a barrel for the second half of 2021 with the dollar weakening and rising inflation expectations, it said. Record supply cuts by the Organization of the Petroleum Exporting Countries and allies, known as OPEC+ have helped support prices, but with grim economic figures being reported almost daily, the outlook for demand for oil remains bleak. China’s factory gate prices fell for a seventh straight month in August although at the slowest annual pace since March, suggesting industries in the world’s second-biggest economy continued their recovery from the coronavirus-induced downturn.
Oil prices finish higher, but concerns remain over outlook for demand – Oil futures finished higher Wednesday, with U.S. prices reclaiming less than half of the more than 7% drop suffered in the previous session as worries over the demand outlook, driven by the pandemic, continued to limit crude’s upside potential. “The bounce in oil prices reflects the market recovering from the oversold positions” Tuesday, said Manish Raj, chief financial officer at Velandera Energy, “As the flurry of panic-stricken traders was absorbed,” the market was balanced today, leading to a rebound. However, “this week’s volatility is a reflection of substantial uncertainty in oil demand,” Raj told MarketWatch. “Whereas gasoline demand has staged a handsome V-shaped recovery world-wide, and particularly so in the U.S., distillate and jet fuel demand is elusive to say the least.” West Texas Intermediate crude for October delivery on the New York Mercantile Exchange rose $1.29, or 3.5%, to settle at $38.05 a barrel. November Brent crude, the global benchmark, rose $1.01, or 2.5%, to $40.79 a barrel on ICE Futures Europe. Weekly data on U.S. petroleum supplies will be released late Wednesday from the American Petroleum Institute and Thursday morning from the Energy Information Administration. The reports are each delayed by a day due to Monday’s Labor Day holiday. On average, the EIA is expected to report a decline of 500,000 barrels in crude supplies for the week ended Sept. 4, according to analysts polled by S&P Global Platts. Gasoline supplies are likely to have fallen by 2.5 million barrels, while distillates, which include heating oil, are expected to be up by 300,000 barrels, the survey showed.
Oil Inventories Rose by 2.9M Barrels Last Week: – U.S. oil stockpiles snapped six-straight weeks of declines on Wednesday at a time when the renewed spread of Covid-19 cases in some parts of the world threatens the demand outlook. U.S. crude inventories rose by 2.97 million barrels last week, according to an estimate released Tuesday by the American Petroleum Institute, after a draw of 6.36 million barrels the previous week. Crude Oil WTI Futures, the U.S. benchmark for oil, was up 2.64% after settling 3.5% higher at $38.05 a barrel on Wednesday. The surprise build comes a day ahead of the official government expected to show weekly U.S. crude supplies fell by 1.33 million barrels lasrt week.
WTI Holds Below $38 After Surprise Crude Build Raises Demand Fears – Oil prices are sliding once again this morning, with WTI unable to hold above $38 as concerns over rising American crude stockpiles pick up as global oil demand is expected to decline over 8 million barrels a day this year and likely won’t get back to 2019 levels before 2022, according to S&P Global Platts. At the same time, OPEC and its allies are unleashing crude back onto a market that’s still working through the inventory glut it built up earlier this year.“Uncertain oil-market fundamentals are holding prices back,” said Jens Pedersen, a senior analyst at Danske Bank. The “climb in U.S. crude stocks plays into the market worries over weak demand.” After last night’s surprise build in crude stock s reported by API, all eyes are back on official data for signs of a growing glut. DOE:
- Crude +2.06mm (-806k exp)
- Cushing +1.838mm
- Gasoline-2.954mm
- Distillates -1.675mm
After 6 straight weeks of draws, US crude stocks built last week by over 2 million barrels US Crude Production barely bounced back after last week’s storm-related shut-ins. WTI held below $38 on the official data… Finally, we note that Brent’s six-month timespread was $2.71 a barrel in contango – where prompt prices are cheaper than later-dated ones – compared with $1.97 at the end of August. The change in the market structure indicates growing concern about a glut and may also, together with falling tanker rates, incentivize floating storage.
Oil prices slip as growing stockpiles signal bumpy fuel demand recovery – Oil prices slid on Thursday after data showed U.S. crude stockpiles unexpectedly rose last week, stoking concern about a sluggish recovery in fuel demand as coronavirus cases continue to surge in many countries. U.S. West Texas Intermediate crude futures fell 49 cents, or 1.3%, to $37.57 a barrel, after climbing 3.5% on Wednesday. Brent crude futures dropped 37 cents, or 0.96% to $40.39 a barrel, after rising 2.5% on Wednesday. The oil market is under pressure on the prospect of both subdued demand and rising supply, ANZ analysts said in a note. The U.S. Energy Information Administration will release official weekly inventory data later on Thursday, a day later than normal following this week’s U.S. Labor Day holiday. “(Refinery) maintenance season and a cautious approach from refiners should keep crude oil demand soft,” the bank said, referring to regular scheduled outages at oil processing complexes. ANZ also said China’s imports are likely to level off as ‘teapot,’ or independent refineries, reach their maximum annual crude import quotas. With coronavirus cases rising in several U.S. states, the country’s crude stockpiles rose by 3 million barrels in the week to September 4, data from the American Petroleum Institute showed on Wednesday. That compared with analysts’ forecasts of a draw of 1.4 million barrels. “If the EIA confirms a crude oil build later today, it would be the first U.S. stock build since mid-July,” ING analysts said. The EIA already cut its 2020 world oil demand growth forecast by 210,000 barrels per day to 8.32 million bpd. In a further bearish sign, leading commodity traders are booking tankers to store crude oil and diesel on the water, with supply outpacing consumption, according to trading sources and shipping data. The rising stockpiles come ahead of a meeting on September 17 of the market monitoring panel of the Organization of the Petroleum Exporting Countries and allies including Russia, together known as OPEC+, which in August trimmed supply curbs from earlier this year on expectations demand would improve. “This issue will be front and center… next week, where we expect a strong statement that if markets continue to weaken, the producer group will be prepared to trim output further,” Citi analysts said in a note.
It’s Happening Again – Traders Store Oil At Sea As Recovery Falters – Crude prices slid Thursday as the stalled global economic recovery from the virus pandemic triggers a “second wave” of demand fears and sparks renewed interest in floating storage as the oil market flips bearish. Reuters said a “fresh build-up of global oil supplies, pushing traders including Trafigura to book tankers to store millions of barrels of crude oil and refined fuels at sea again.”Floating storage, onboard crude tankers, comes as traditional onshore storage nears capacity as supply outpaces demand. Refinitiv vessel data shows trading house Trafigura has recently chartered at least five crude tankers, each capable of 2 million barrels of oil. The inventory build up, driving up demand for floating storage comes as OPEC+ recently trimmed supply curbs from earlier this year on expectations demand would improve. Though with the peak summer driving season in the US now over, demand woes and oversupplied markets are pressuring crude and crude product prices.Very large crude-oil carrier (VLCC) storage has started to rise once again. “Despite the recent slide in oil prices, we think that the OPEC+ leadership will continue to direct its efforts towards securing better compliance rather than pushing for deeper cuts at this stage,” RBC analysts said.Another catalyst for the bearish tilt in crude markets is that China’s oil imports are likely to subside as independent refineries have reached maximum annual oil import quotas.Reuters notes, in a separate report, that other top commodity traders are booking tankers to store crude products at sea, including diesel and gasoline. Refinitiv vessel data also shows Vitol, Litasco, and Glencor have been booking tankers in the last several days to store diesel for the next three months. “The market is soft and bearish, and floating storage is returning again,” a market source told Reuters.
Oil prices slide near 2% after surprise U.S. crude stock build (Reuters) – Oil prices slid nearly 2% on Thursday after U.S. data showed a surprise build in crude stockpiles last week related in part to ongoing reductions at refineries along the Gulf of Mexico following Hurricane Laura. Brent futures fell 73 cents, or 1.8%, to settle at $40.06 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 75 cents, or 2.0%, to settle at $37.30. After the market close, WTI briefly traded down over $1 a barrel and Brent was down as much as 99 cents. The U.S. Energy Information Administration (EIA) said crude inventories rose 2.0 million barrels last week. That confirmed the direction of the 3 million-barrel increase reported by the American Petroleum Institute (API), but was a surprise compared with the 1.3 million-barrel decrease that analysts forecast in a Reuters poll. “Today’s crude data looked bearish … with about the only supportive element being the fact that the 2 (million-barrel) build was less than that indicated by the API,” said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois, noting prices could fall further unless Gulf of Mexico refiners fully restart soon after shutting for Hurricane Laura. Brent and WTI futures dropped to their lowest since mid June earlier this week and have remained in oversold territory over the past several days. Brent’s Relative Strength Index (RSI) was under 30 for a fifth straight day for the first time since March. In China, Bank ANZ said oil imports were likely to level off as independent refineries reach their maximum quotas. In a further bearish sign, leading commodity traders were booking tankers to store crude oil and diesel. The rising stockpiles come ahead of a meeting on Sept. 17 of the market monitoring panel of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, a group known as OPEC+. “Despite the recent slide in oil prices, we think that the OPEC+ leadership will continue to direct its efforts towards securing better compliance rather than pushing for deeper cuts at this stage,” RBC analysts said.
Oil ekes out gain, but still posts second straight negative week – Oil prices edged higher on Friday as equities markets firmed, but crude remained on track for a second weekly drop as investors expected a global glut to persist if demand weakens further with rising COVID-19 cases in some countries. Brent crude rose 16 cents, or 0.4%, to $40.22 a barrel. U.S. crude settled 3 cents, or 0.08%, higher at $37.33. For the week, however, it declined more than 6%. Infections are growing faster in India than anywhere else, and the health ministry reported another record daily jump of 96,551 new cases on Friday, taking the official total to 4.5 million. U.S. stock markets rose, after a pullback in the previous session. Still, the three main U.S. stock indexes were also headed for a second straight weekly decline as recent economic indicators suggested a long and difficult recovery from the pandemic. “The financial markets are continuing to set the tone, including on the oil market … fears about an oversupply have added to the general feeling of uncertainty,” Commerzbank analysts said in a note. Also dampening the market mood, the U.S. Senate killed a Republican bill that would have provided around $300 billion in new coronavirus aid. In the United States, crude stockpiles rose last week, against expectations, as refineries slowly returned to operations after production sites were shut down due to storms in the Gulf of Mexico and the wider region. U.S. crude inventories rose 2 million barrels, compared with forecasts for a 1.3 million-barrel decrease in a Reuters poll. U.S. drillers also have started to slowly add oil and gas rigs after the rig count, an early indicator of future output, hit a record low of 244 in the week to Aug. 14. This week’s data from Baker Hughes is due at 1 p.m.. In a further bearish sign, traders were starting to book tankers again to store crude oil and diesel, amid a stalled economic recovery as the COVID-19 pandemic continues. Increasing stockpiles are likely to be a subject at a meeting on Sept. 17 of the market monitoring panel of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia. The group known as OPEC+ has been withholding supply to reduce stockpiles, but analysts say the meeting is likely to focus on compliance among members, rather than deeper cuts. Following Saudi Arabia, Kuwait also lowered its official selling price to Asia for October, to counter slower demand. “The decline is triggered by a series of unfortunate events: a surge in COVID-19 cases worldwide, the end of the peak summer driving season, the slowdown of the Chinese crude importing machine, and major producers trimming the OSPs to Asia as refinery margins worsen,” Rystad Energy’s senior oil markets analyst Paola Rodriguez-Masiu said.
Oil ends lower for second week as stockpiles rise, demand weakens – (Reuters) – Oil prices were little changed on Friday, but posted their second straight weekly loss as stockpiles rise around the world and fuel demand struggles to rebound to pre-coronavirus levels.Both Brent and U.S. crude lost about 6% on the week after a series of signals that showed markets still have an abundance of supply. Saudi Arabia and Kuwait cut official selling prices to Asia, U.S. stockpiles rose and traders are booking vessels for storage. Brent ended the session down 23 cents, or 0.6%, at $39.83 a barrel while U.S. crude settled up 3 cents at $37.33 a barrel.Coronavirus infections are growing in several countries, led by India, where the health ministry reported a record daily jump of 96,551 new cases on Friday, taking the official total to 4.5 million.U.S. stock markets ended lower for a second week following several economic indicators that suggest a long and difficult recovery from the pandemic.“The financial markets are continuing to set the tone, including on the oil market… fears about an oversupply have added to the general feeling of uncertainty,” Commerzbank analysts said in a note.In the United States, crude stockpiles rose 2 million barrels last week. Refineries slowly returned to operations after production sites were shut due to storms in the Gulf of Mexico. Traders are starting to book tankers again to store crude oil and diesel, another signal of oversupply amid a stalled economic recovery as the COVID-19 pandemic continues.For a graphic on Oil Product Floating Storage in Europe Oil Product Floating Storage in Europe: https://graphics.reuters.com/GLOBAL-OIL/nmovaqzkdva/chart.png The market monitoring committee Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, or OPEC+, will meet on Sept. 17 to consider how to deal with worldwide oversupply. The group reduced output in the spring to allow stockpiles to run down.In recent days, both Saudi Arabia and Kuwait lowered their official selling prices for crude to Asia for October, a signal of slower demand. Money managers cut their net long U.S. crude futures and options positions in the most recent week, a sign hedge fund managers expect further weakness in the oil markets.
Collapse in oil prices threatens social and political unrest in Middle East and North Africa – The collapse in oil prices earlier in the year, along with cuts in oil production and the world-wide recession following the COVID-19 pandemic, is having a devastating impact on economic and social conditions in the oil-producing countries of the Middle East and North Africa (MENA). The repercussions spread far beyond the oil producers’ borders. Oil prices, which started the year at around $60 a barrel – nearly half that of a decade ago – fell to $40 in March and plummeted into negative territory before rising again to around $40 a barrel in recent weeks. This year, oil revenues are expected to be around $300 billion, down from $575 billion in 2019 and more than $1 trillion in 2012. While oil production may just be profitable at $40 a barrel, none of the Arab states except Qatar can balance their budgets at this level. The worst affected, Algeria and Oman, need prices to rise to $157 and $87 a barrel, respectively. Even the largest oil producer, Saudi Arabia, which relies on oil for 70 percent of its budget, needs $80 a barrel to balance its books. In June, the International Monetary Fund estimated that the economies of the Gulf Cooperation Council (GCC) countries – Saudi Arabia, the United Arab Emirates (UAE), Kuwait, Bahrain, Oman and Qatar – would shrink by 7.6 percent this year, while Iraq’s economy is expected to contract by 7.5 percent and Iran’s by 6 percent, on top of a 7.6 percent decline in 2019 and 5.4 percent in 2018 due to Washington’s unilateral pull-out from the 2015 nuclear agreement. Since March, the Arab petro-states have slashed public expenditure – including the salaries of public sector workers, who form 90 percent of regular, full-time workers – raised sales taxes and petrol prices, all of which have fallen hardest on the poor. Subventions, which for the corporate sector have far exceeded any poverty relief measures, have been borrowed on the international money markets and are eating into foreign currency reserves. Even Saudi Arabia, which faces a budget deficit for 2020 equal to 16 percent of GDP, has only two years’ reserves left at current spending rates. More tax rises and privatisations are on the agenda, with its giant desalination plant, the world’s largest, up for sale.
Two decades of US “war on terror” responsible for displacing at least 37 million people and killing up to 12 million – A staggering new report coauthored by Professor David Vine at the Watson Institute at Brown University conservatively estimates that 37 million people, equivalent to the entire population of Canada, have been forced to flee their home country, or have become internally displaced within it by nearly two decades of unending US imperialist war. The analysis, published by the Costs of War Project, sought to quantify for the first time the number of people displaced by the United States military operations since President George W. Bush declared a “global war on terror” in September 2001 following the still unexplained attacks on the World Trade Center in New York City and the Pentagon.Professor Vine and his coauthors note that the 37 million estimated displaced is a “very conservative estimate,” with the real number of people displaced since September 2001, “closer to 48-59 million.” That is as much as, or more than, all of the displaced persons in World War II and therefore more than any other war in the last century. It is difficult to articulate the levels of misery, poverty, hardship, strife, pain and death visited upon entire societies and endured by millions of people. The latest Costs of War report focused on eight countries that have been subjected to major US military operations: Afghanistan, Pakistan, Yemen, Somalia, the Philippines, Iraq, Libya and Syria. The two countries with the highest number of displaced persons were Iraq and Syria, whose populations have suffered for decades under US-led regime-change operations and military occupations initiated by both Republican and Democratic administrations. The authors estimate that 9.2 million people in Iraq and 7.1 million in Syria have been displaced respectively, in both cases roughly 37 percent of the prewar population. The authors were careful to note that they only counted Syrian refugees and displaced persons post-2014, even though US-funded and supplied terrorist groups such as the Al Qaeda-affiliated Al Nusra Front, the Islamic State and other Islamist groupings began operations against the Syrian government as early as 2011. If the figures were to include the previous three years, the estimates exceed 11 million. Somalia, where US forces have been operating since 2002, has the highest percentage of displaced persons with 46 percent of the country or nearly 4.2 million people displaced. Throughout the “war on terror,” the authors estimate between 770,000 and 801,000 civilians and combatants on all sides have died in Afghanistan, Iraq, Syria, Pakistan and Yemen since US forces began military operations in those countries. The number of “indirect deaths,” that is, those who weren’t confirmed killed by military weaponry, but died due to lack of healthcare, infrastructure, or food as a result of US military operations, embargoes and blockades may exceed 3.1 million, although the authors noted that credible estimates range in excess of 12 million.
Trump’s Iraq Troop Draw-Down To Begin This Month, Top General Announces –Previously the Trump administration said it would aim for a major troop reduction in Iraq by the time of the November election. It appears that promise – part of the Trump campaign’s longtime pledge to “bring Americans home” from unnecessary “endless” foreign wars and occupations abroad – is on track to be delivered. Head of US CENTCOM, Marine Gen. Frank McKenzie, said while touring a US base in Iraq that troop numbers there will be cut down to 3,000 this month.Current American troops levels are at about 5,200 – though we should note the tens of thousands of US contractors and other privatized personnel that remain there.Gen. McKenzie underscored in statements that Washington feels confident that Iraqi forces are now trained to handle any threat from a potentially resurgent ISIS, now long driven underground.”This reduced footprint allows us to continue advising and assisting our Iraqi partners in rooting out the final remnants of ISIS in Iraq and ensuring its enduring defeat,” McKenzie said.US training of Iraqi military personnel had reportedly already been scaled back through the course of the coronavirus pandemic, given local as well as international lockdowns and travel restrictions. During a Labor Day news conference President Trump raised eyebrows in charging top Pentagon commanders of ultimately being beholden to defense contractors. Speaking of what sectors of the military are supportive of the Commander-in-Chief, Trump said Monday: “The top people in the Pentagon probably aren’t because they want to do nothing but fight wars so all of those wonderful companies that make the bombs and make the planes and make everything else stay happy.”
Turkey Escalates With Tanks & Armored Troop Carriers Deployed To Greek Border – Amid soaring Turkey-Greece tensions related to the eastern Mediterranean gas exploration spat, which has already resulted in rival fighter jets patrolling airspace off Cyprus, the Associated Press reports Ankara has deployed some 40 tanks and armored vehicles to the border with Greece. The AP/New York Times cites Turkish media reports on Saturday:Meanwhile, Turkish media reported that tanks were being moved towards the Greek border. The Cumhuriyet newspaper said 40 tanks were being transported from the Syrian border to Edirne in northwest Turkey and carried photographs of armored vehicles loaded on trucks.There was no immediate official confirmation of the deployment. Turkey deploys tanks to Greece border from Syrian border, Turkish private news agency İHA claims. Approximately 40 tanks. pic.twitter.com/nnDrEegXsj – Ragıp Soylu (@ragipsoylu) September 5, 2020 But confirmation has come after Turkish news agency İHA posted video showing APC armored troops carriers headed to the border point. However, tanks were not evident in the video of the large convoy on the Turkish highway, and the deployment could have been pre-planned, though will certainly be noticed and responded to by Athens. Meanwhile NATO leadership is attempting to mediate the inter-NATO member dispute, which could prove highly embarrassing, also given Russia is about to kick off naval war games around Cyprus, notably in the very disputed waters Turkey is claiming as its own.