Can Africa’s oil producers weather the oil price storm?

West Africa has suffered one of its most difficult years in 2014. and 2015 is shaping up to be an even more difficult year for that region. While the deadly Ebola virus will eventually wind down, the disruptions caused by the outbreak will continue to cripple the economies of Liberia, Guinea and Sierra Leone.

The political landscape across west and east Africa remains delicate as nations across the region continue to grapple with insecurity and terrorist threats. Africa in 2014 faced intensified terrorism in Nigeria, increased attacks by al-Shabab in Kenya and civil war in the Central African Republic and South Sudan. Among other challenges in the region, piracy in the Gulf of Guinea will continue to hinder trade and economy, and despite progress in developing maritime security infrastructure, more efforts are needed to resolve maritime borders.

However, one big unknown in 2015 is to what extent the sharp fall in prices will affect economic growth rates for Africa’s oil exporters and the impact in major cutbacks in government spending.

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Opportunities are strong in the European oil storage business

The room was pretty full for the first day of the Platts European Storage conference in Amsterdam this week, and it’s not surprising: the opportunities in this segment appear to be as strong as they’ve been for years.

Most important are three big factors: the market is in contango, which encourages storing crude and products; trade flows are changing, on the back of European refinery closures and the US shale revolution, requiring new storage facilities in some areas; and those refinery closures are providing opportunities for storage companies to buy the tanks and other facilities at the shuttered plants, and turn them into terminals.

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EIA analysis: Crude oil production, refinery slowdown drive stocks higher

US commercial crude stocks jumped 10.1 million barrels during the week ended January 16, according to the latest data from the US Energy Information Administration. The inventory, at 397.9 million barrels, was 16% above the EIA five-year average for the same reporting week. Read a thorough analysis of the EIA data here.

California’s cap-and-trade no more than road bump in gasoline’s steep price decline

Drivers in car-crazed California paid more than 10% more for their gasoline at the start of the year. They just didn’t realize it.

As expected, California’s introduction of the emissions cap-and-trade program for transportation fuel suppliers boosted Los Angeles regular gasoline rack prices nearly 17 cents in the first two days of 2015 to $1.5885/gal. The rack is the wholesale level where gasoline and diesel is moved onto those often-shiny tanker trucks that hold roughly 9,000 gallons.

What barely changed right away was the price up and down the supply chain.

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UK energy reform is not just about price cuts

The UK’s “big six” energy retailers have started to lower their gas prices, undercutting the opposition Labour party’s promise to freeze household energy bills if the party comes to power in the May 2015 general election. But the party’s plans go further than just its headline tariff freeze.

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Egypt’s Sisi outlines national energy policy at World Future Energy Summit

Egypt has set development and reform of its energy sector as a key priority as it seeks to rebuild its economy following the country’s second revolution in the past few years, the country’s president, Abdel-Fattah el-Sisi, said January 19 during his first official visit to the UAE in that role.

During his keynote address to the World Future Energy Summit in Abu Dhabi, Sisi also said he considered the security of the Persian Gulf region to be “part and parcel of Egyptian security.” The annual Abu Dhabi WFES gathering, while primarily a UAE forum for promoting and discussing regional and international renewable energy development, has also developed a significant political agenda.

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Regulation and Environment: A whole lot of factors in the Keystone XL decision

Beyond the politics, there are a lot of legal reasons that President Obama can–or can not–deny the application to build the Keystone XL pipeline. Gary Gentile discusses some of them in today’s Oilgram News column, Regulation & Environment.


Pop quiz: What factors can President Obama consider when deciding whether to issue a permit for the Keystone XL pipeline?

a) Environmental issues, including the impact of oil sands development on the climate.

b) The relative safety of transporting heavy crude by rail versus pipeline.

c) Maintaining good relations with Canada, one of our most important trading partners.

d) The odds of the New York Mets making the baseball playoffs this year.

The surprising answer is “all of the above.” Surprise again: the correct answer could also be “none of the above.”

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Then and now: How prices of key petrochemicals in the US behaved the last time crude was $50/b

With oil prices at lows not seen in more than 5 1/2 years,  the global petrochemical industry finds itself playing memory games as it craves some much-needed guidance regarding price behavior.

Whether you believe past performance is the best indicator of current and future behavior – or the worst – it’s always fun to look back, right?

With that in mind, let’s take a peek at how prices of key petrochemicals in the US behaved in 2009 versus today.

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Is politicking pushing oil prices lower?

The immediate reason for the oil price plunge seems fairly clear – producers going gung-ho at a time of weak demand, which is not helped by the buoyant greenback.

What is murkier, perhaps, is how geopolitical agendas and motivations are feeding the bear market.

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Is the tide about to turn for oil prices?

The International Energy Agency on January 16 gave the beleaguered oil industry something to feel happy about, suggesting that an oil price recovery could be around the corner. However, producers suffering from sub-$50/b oil will still have some time to wait yet before they can expect any real improvement in prices.

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