Wednesday, July 29, 2020

China: Record oil imports from KSA

Reuters writes: 

"Saudi, however, delivered bigger oil cuts from June and raised crude prices as a plunge in oil prices weighed on the kingdom’s budget.

China, the world’s biggest crude oil importer, took in a record 53.18 million tonnes last month, according to customs data.

China also boosted inflows from Brazil, Norway and Angola, said Emma Li, analyst from Refinitiv. 

Brazil, whose massive offshore projects are coming online, offered Asian refiners competitive deals on relatively high-quality oil just as China and other Asian countries contained the coronavirus and reopened their economies.

Analysts expect China to see another record amount of crude imports in July as some May-loading cargoes are still underway while swelling oil inventory at major Chinese ports slows new arrivals."


Nord Stream 2: US government increases the pressure on german contractors

While the construction of the Nord Stream 2 pipeline has come to a halt due to sanction threats against the pipelaying operator the US government has now made clear that also german contractors will be targeted by sanctions if they do not establish that they withdraw from the controversial project, writes german newspaper "WELT":

"According to information from WELT, the US State Department asked German and European companies for one-on-one video interviews immediately after this step and made clear to them the far-reaching consequences of further project participation. According to circles of business representatives, German managers sat in the short-term meetings with up to twelve representatives from the three US departments Department of State (Foreign), Treasury (Finance) and Energy.
Among other things, companies should explain what needs to be done on the pipeline to fulfill their work order. The US officials "had made it very clear in a friendly tone that they wanted to prevent the pipeline from being completed," said one observer: "I think the threat is very, very serious." 
Die Firmen selbst, darunter technische Dienstleister, aber auch große Energiekonzerne wie Uniper, Wintershall Dea und Shell, wollten dazu gegenüber WELT keinen Kommentar abgeben. Auch öffentlich zumeist unbekannte mittelständische Zulieferer des Pipeline-Projekts sind Adressaten der Sanktionsdrohung geworden.

Aus dem Außenministerium in Berlin hieß es: „Das Auswärtige Amt hat Kenntnis darüber, dass die US-Seite Gespräche mit deutschen Unternehmen führt, um die CAATSA-Durchführungsbestimmungen zu erläutern.“ Man sei „mit den Unternehmen dazu ebenfalls in Kontakt“.

You can read the rest of the piece via the below link:


Tuesday, July 28, 2020

Nord Stream 2: Russia anticipates possible shift of E.U. countries to hydrogen

As countries of the bloc map out ways to disengage from climate-damaging fuels the plans point towards hydrogen. Russia, the market leader for oil and gas in Europe, anticipates this shift away from natural gas and reshuffles its production capacities. Gazprom will have to reflect the further use of the Nord Stream pipelines. Especially Nord Stream 2 coud turn out a major failed investment, writes german newspaper "Handelsblatt":

"According to Yuri Melnikow, senior analyst for energy issues at the Skolkowo University of Applied Sciences, hydrogen should be produced close to the sales markets. For Gazprom, this is primarily the European market. The company is currently exploring projects within the EU. Another option is hydrogen transport via the gas pipelines.
Otherwise, if the Europeans switch to hydrogen on a massive scale, Russia must fear that the pipelines will be shut down. The 8.5 billion euro Nord Stream 2, which is still under construction, will pay off after ten years at full capacity. If hydrogen production in Europe massively reduces gas imports, Nord Stream 2 threatens to become an investment ruin.
Gazprom is therefore considering sending at least one gas mixture mixed with hydrogen through the pipelines. In old pipelines, 20 percent of hydrogen could be added to natural gas, in new pipelines such as Nord Stream, the share could even be up to 70 percent, Gazprom estimates."

You can read the rest of the piece via the below link:

Friday, July 24, 2020

Mexico: energy and oil industry perturbed by cartel activity

A feature about the situation in the state of Tamaulipas in the north-east of Mexico by Argus:

 "Over the past seven months, security experts working with oil, gas and renewable energy companies in the region have documented 15 deaths from cross-fire, seven assaults by cartel members fleeing confrontation with a rival gang, 25 kidnappings to extract money or extort information about rival gangs or for fuel theft, as well as numerous cases of vehicle theft and telephone extortion. Despite the high level of criminal activity, charging companies a fee to operate in the state, known as derecho de piso, is not common practice in Tamaulipas as it is in other part of the country.

A handful of illegitimate oil services companies, suspected of being fronts for laundering the profits of fuel theft, are also thought to be responsible for widely documented theft of heavy machinery, valves and pipes from oil field sites.

"Tamaulipas has a very specific security dynamic circled around criminal lookouts," Garcia said. "The groups are not necessarily tracking the companies themselves but are trying to keep track of rival organizations."

Companies operating in the state employ a range of protocols to protect their staff and operations, including daylight-only working hours, maintaining a high industrial profile through the use of vehicles and uniforms clearly marked with company logos, kidnap training for personnel, the use of hotels and apartment complexes that commit to anti-kidnap protocols, and the sharing of real-time data on criminal incidents in order to plan daily personnel movements."

You can read the rest of the piece via the below link:

You might also check out the very interesting blog "Borderlandbeat" about narcos and cartels in Mexico.

Thursday, July 23, 2020

EU bulletin on energy for Q1 2020

The press service of the European Union has issued its assessment  of prices and consumption of different energy sources. Concerning gas it ascertains:

"The gas report also illustrates a volatile quarter. Energy prices, including natural gas, underwent a steep fall, and the EU gas import bill fell below €10 billion, which was the lowest quarterly total in the last six years.

Gas prices in the EU were impacted by increasing LNG imports and intensive storage withdrawals, ensuring abundant supply on the market, whereas demand for gas was limited by mild weather, resulting in less heating needs, and decreasing need for gas in the electricity sector, owing to high shares of renewables in power generation in Q1 2020.

Russia remained the most important pipeline gas supplier for the EU in Q1 2020, however, its share fell to 40% in the total EU imports, and the gas transit volumes through Ukraine fell by 49% year-on-year, as Gazprom preferred to sell gas from EU storages rather than shipping through Ukraine.

LNG shipments accounted for a new record (28%) of EU gas imports.

At the end of March, gas storage levels in the EU stood at 54% - the highest seasonal figure for nine years.

Retail gas prices for industrial customers with median annual consumption were down by 10%, and for big consumers price decreases were even more marked (17%-20%) in Q1 2020 year-on-year. "

You can read the rest of the piece via the below link:

Wednesday, July 1, 2020

Former chancellor Schröder lobbies for Nord Stream 2 in German parliament

Ex chancellor Gerhard Schröder was invited to the economic committee of the Bundestag by the leftwing and ex-communist party of the GDR, Die Linke, to speak as an expert on Nord Stream 2 where he spoke against US sanctions against the pipeline and appeals to counter-sanctions:

Schröder is Chairman of the Board of Directors at Nord Stream 2. In the Economic Committee, he now rejected the accusation that Nord Stream 2 jeopardizes Germany's security of supply. The opposite is the case.
The SPD politician also had an answer to the impending US sanctions. Schröder spoke in favor of EU counter-sanctions. The federal government had to put pressure on it at EU level.

You can read the rest of the piece via the below link: