According to this article on Real Clear Energy, Russia may be touring the world preaching production freeze now, but its Freeze, Baby, Freeze stance is the result of recent conversion — as this chart from the Wall Street Journal shows.
Less than a month ago, the Journal reports, “the drilling rigs of oil giant OAO Lukoil [were] helping raise Russia’s oil output to its highest levels since the breakup of the Soviet Union…”
According to this article on Singapore (Platts)–2 Feb 2016 806 am EST/1306 GMT, Litasco, the trading arm of Russia’s Lukoil, is set to ship the first Suezmax-sized cargo out of Iran after international sanctions were lifted three weeks ago, market sources said Tuesday.
Litasco has placed the Distya Akula on subjects for a Kharg Island to Constantza voyage, loading 130,000 mt of crude over February 5-10, market sources said.
Further details couldn’t immediately be confirmed and Litasco declined to comment on the matter.
The 1995-built India-flagged Distya Akulawas, formerly the Front Glory, was last tracked in the Persian Gulf heading towards Al Basrah on January 31, according to cFlow, Platts trade flow software.
This fixture was to replace the Eurospirit, which was first heard booked by Litasco on January 26, said ship brokers.
The next Suezmax loading out of Kharg Island was heard to be done by Spanish refiner Cepsa, market sources said.
The sources added that Cepsa would use a Suezmax tanker in its own fleet, the Monte Toledo, to lift 130,000 mt of crude from Kharg Island to Spain.
Cepsa couldn’t immediately be reached for comment.
Currently, the Monte Toledo is in the Mediterranean en route to Port Said, showed cFlow.
–Wanda Wang, wanda.wang@platts.com
–Edited by James Leech, james.leech@platts.com
Here is a way to follow the tanker’s (the Distya Akula) actual movements.
According to , Iran is open for business, and France’s Total (TOT) reportedly was one of the first Western companies ready to resume relations with Tehran after economic sanctions were lifted.
The oil giant will sign a deal to buy 150,000-200,000 barrels of oil a day from Iran, according to Total CEO Patrick Pouyanne in a Wall Street Journal report.
The deal comes as Iranian President Hassan Rouhani and Oil Minister Bijan Zanganeh travel to Paris to make deals in the aerospace and auto industries.
On Thursday, Iran Air signed an agreement with Airbus (EADSY) to buy 73 widebody aircraft and 45 single-aisle jets.
Total’s U.S.-listed shares closed up 1.8% in the stock market today, as oil prices continued to rally. U.S. shares of Airbus rose 1.3%.
Royal Dutch Shell (RDSA) has also said it is ready to get into the Iranian market. Last week, BP (BP) CEO Bob Dudley told the BBC that while the company was looking at opportunities in Iran, he was still concerned about rushing in, as some U.S. sanctions remain in place.
Shell shares rose 3.7%, and BP shares climbed 3.9%.
Earlier this week, Saipem, an Italian oil service provider, signed deals National Iranian Gas Co. and Parsian Oil & Gas Development Co.
Meanwhile, oilfield service provider Schlumberger (SLB) is also getting ready to re-enter the Iranian market. According to a Wall Street Journal report earlier this month, the company is looking to buy back its former subsidiary in Iran.
Schlumberger shares jumped 6%.
Iran has said it could boost its crude exports by 500,000 barrels a day. But Saudi Arabia, the de facto leader of the Organization of the Petroleum Exporting Countries, is unlikely to cut back production to make room for Tehran’s crude, meaning the global oil glut could worsen.
However, Russia’s energy ministry said Wednesday a deal to cut production with OPEC was discussed with Russian oil firms. Earlier, Saudi Arabia had said it wouldn’t cut production without a reduction from other major players like Russia. On Thursday, several OPEC officials told Bloomberg no meeting with Russia was planned.
Western corporations are eager to tap Iran’s relatively young, well-educated and tech-savvy consumers. Apple (AAPL), General Electric (GE) and Boeing (BA) are also preparing to enter or expand in Iran’s market.
Just the mention of Russia’s oil minister, Nikolai Tokarev, wanting to speak with OPEC sent oil on a short upward spike. In the long run, the only way to curtail the continuing drop in oil prices may be for both the US and Russia to join. That, however, may take an “act of congress”. Eventually, all oil producers may have to join and this may be the best for all concerned. Just a thought.
Wow. With all the talk of electric cars, hydrogen fuel cells, drones, hybrids, and generally going green, Carl Icahn has out bid Bridgestone in a bidding war (none the less) for the automotive aftermarket behemoth, Pep Boys. (800 stores!) He even said he would beat any bid by .50.share, and will pay a huge fee, ($39.5 million breakup to terminate the initial deal officially), to close the transaction. So, with all this news about crashing oil prices, stock market crashes, and green tech bulls, what does he see? Are all the car manufacturers switching over to electric so there will only be aftermarket parts? What does he see?
Apparently, Bridgestone was after their tire business and some say that Icahn will sell this part of the business to Bridgestone after the deal closes, next year. If gas prices catch up with oil, and oil stays down, it may be time to start shorting those green stocks. Also, it may to time to look at some of Pep Boys competitors.
Summary of Weekly Petroleum Data for the Week Ending December 25 , 2015
Energy Briefing: Global Crude Oil Demand & Supply
WEEKLY REFINING INDICATORS REPORT: WEEK ENDING 12/25/2015
Planning and Integration of Refinery and Petrochemical Operations
I live in Point Richmond. It’s a fascinating little place with a lot of history and characters. It also is in the shadows of the Chevron Refinery and is part of the reason I have become so enthralled with the oil industry. It is literally in my back yard.
It made national news a couple of years ago when a fire there sent hundred to the hosptital. But, the relationship with oil goes much further back. For example, I live next to “The Plundge”, the states largest Natatorium (indoor swimming pool). It’s there because Nicholl was digging for oil, and found water instead. Then, he turned it into a pool. John D. Rockefeller came here.
According to this article in Richmond Pulse, in 1901, that John D. Rockefeller brought Standard Oil to Richmond. Rockefeller’s company was already embroiled in controversy, over accusations that it had monopolized the oil industry in violation of the Sherman Antitrust Act. The refinery in Richmond was just one of thousands operated by Standard Oil across the country.
The Standard Oil refinery began producing oil on the Fourth of July, 1902. The refinery grew steadily, eventually occupying nearly 1,800 acres of land and becoming the largest employer for the area. The presence and revenue from Standard Oil and the Santa Fe Railroad ushered in additional industries along Richmond’s shoreline.
The huge amount of revenue being generated by the city’s new industries necessitated a functional city government, and entrepreneurs and landholders led efforts to establish a political leadership in Richmond. Their actions led to the creation of business associations and a government body that acted in conjunction with corporations to lure more industries. In less than ten years after its incorporation, Richmond’s population grew from 2,000 in 1905 to around 10,000 in 1912. The quick growth infused the city with confidence. Richmond city and business leaders declared themselves “The Pittsburgh of the West,” and U.S involvement in World War I propelled the refinery to produce more fuel products than ever before.
Yet Richmond had yet to become the modern city it is today. The city’s population was comprised of mostly longtime California residents and a smaller number of European immigrants who came to work in the industries. But as the number of jobs grew, so did the number of minority groups: African Americans, Japanese, Italians, Chinese and Mexicans. These ethnic groups occupied the lower rungs of industrial job ladder, often living in unsanitary and unincorporated areas of Richmond. However, race relations in pre-World War II Richmond were placid. Minorities were able to enjoy a life in Richmond, as long as they respected the racial and ethnic hierarchies.
The World War II mobilization effort was yet another boon for the Richmond economy. Jobs in Richmond’s shipyards attracted thousands of newcomers, many whom were part of a Southern migration to the West Coast. Richmond’s population soared from 23,000 in 1940 to an overwhelming 100,000 in 1944. Newcomers also secured jobs at the refinery, helping Standard Oil meet the wartime demand for oil. The company was even honored by the U.S. government for its role in the military effort. When their interests were aligned, both Richmond and Standard Oil thrived. The Kaiser Shipyards may have overtaken Standard Oil as the city’s biggest employer, but the nation’s thirst for oil and the company’s monopolization of the industry would help it survive and prosper, long after the war ended.
Yet it was after World War II, when Standard Oil became Chevron, that tension between the company and city residents began to grow. Chevron was Richmond’s largest employer in the post-war era. Innovations like the development of gasoline additives to keep carburetors clean in 1954, kept the company profitable. Meanwhile, most of the migrant African Americans and ethnic minorities who had come to Richmond for wartime jobs stayed, but were relegated to living in segregated public housing projects and neighborhoods with high unemployment numbers. Losses experienced by other industries, white re-location and disinvestment in the central city all had a negative impact on the African American and minority communities now living downtown.
De-regulation and unfettered privatization was the trend in the decades to come. Like many other industrial cities, Richmond experienced gradual disinvestment and overall job loss, while Chevron itself enjoyed unprecedented success. Downtown Richmond was now dependent on the success of small businesses, while Hilltop Mall and other shopping centers detracted from downtown’s economic power.
By the 1980’s, Richmond was mirroring another national trend. High rates of drug abuse, in the form of crack cocaine, emerged in the city’s poor minority neighborhoods, further crippling those populations. In contrast, the 80’s represented the pinnacle of Chevron’s success. By then, the refinery had expanded operations into processing high sulfur crudes, building storage tanks for marine cargos and developing refining processes to increase its lubricating oil stock. At this time Chevron also introduced Techron, the first additive developed for vehicles running on unleaded gasoline. The diverging economic trajectories of Chevron and Richmond set the stage for larger contestations in the 1990’s.
Responding to growing economic inequity and environmental injustice, local Richmond activists began to publicly challenge Chevron, beginning a discourse that continues to this day. According tot the West County Toxics Coalition, between 1989 and 1995, there were 304 accidents at the Chevron refinery including fires, spills, leaks, flaring and toxic gas releases. Pressure from environmental groups occasionally forced Chevron to acknowledge their mishandling of the refinery, in one instance after an explosion on March 25, 1999 that sent hundreds to the hospital.
So, as you can see, there is a great deal of oil related history right in my back yard. Now we have many industry consultants and contractors that stay here, and many veterans of the oil industry. It is a very unique place with a very unique culture. I hope you can come visit our little enclave and enjoy its many amenities.
Author: Orville Davis ; Last update: 11 December , 2015 03:41:16
RAQQA, Syria — It’s widely recognized that Daesh (the Arabic acronym for the terrorist group often called IS, ISIS or ISIL in the West) depends on oil sales to fuel its armies. Until recently, it’s been less clear who is buying Daesh’s oil, and how it ends up in their hands.However, recent reports suggest that the oil flows to Europe and Asia through a complex process that implicates allies of the United States like Turkey and Israel. The U.S. is also facing increasing criticism for its failure to target the terrorist group’s oil infrastructure in a serious way until recently.
Cam Simpson and Matthew Philips, writing in November for Bloomberg Businessweek, called recent U.S. attacks on oil trucks an attempt by the Obama administration to “quietly” fix a “colossal miscalculation.” Government experts now argue that the U.S. dramatically underestimated Daesh’s oil profits:
“The Obama administration ‘misunderstood the [oil] problem at first, and then they wildly overestimated the impact of what they did,’ says Benjamin Bahney, an international policy analyst at the Rand Corp., a U.S. Department of Defense-funded think tank, where he helped lead a 2010 study on [Daesh’s] finances and back-office operations based on captured ledgers.”
U.S. intelligence officials now believe Daesh is making at least $500 million from oil sales each year, $400 million more than previous official estimates. “You have to go after the oil, and you have to do it in a serious way, and we’ve just begun to do that now,” Bahney told Bloomberg.
Officials also cited potential civilian casualties to explain their reluctance to go after truckers transporting oil from Daesh-controlled territories. That reluctance apparently ended on Nov. 16, when the U.S. destroyed 116 oil trucks after airplanes “first dropped leaflets warning drivers to scatter.”
Reluctance to harm civilians hasn’t prevented the U.S. from creating high civilian death tolls on other fronts of the “global war on terror.” In August, Airwars, a coalition of independent journalists, estimated that at least 459 civilians had been killed in U.S. airstrikes on Daesh, and those numbers are continuing to rise, with the group’s most conservative estimate of civilian casualties now standing at least 682. Additionally, U.S. drone strikes have proven especially ineffective, hitting more civilians than members of al-Qaida, according to a September report from the United Nations.
Recent developments suggest that U.S. allies directly benefit from the flow of cheap terrorist oil and, given the United States’ role in the creation of Daesh, this could suggest that the reluctance to target Daesh’s oil profits prior to the Paris attacks may be motivated by self-interest.
How ISIS Oil Reaches Israel
On Nov. 26, Al-Araby Al-Jadeed, a London-based media outlet focusing on the Arabic world, published a detailed investigation tracing Daesh’s oil from the massive oilfields in Iraq and Syria to refineries in Israel, where it’s ultimately exported to Europe.
The enormous scale of Daesh’s oil production infrastructure in the Middle East is further evidence of the importance of energy exports to the group. The oil is first extracted from captured oil fields:
“IS oil production in Syria is focused on the Conoco and al-Taim oil fields, west and northwest of Deir Ezzor, while in Iraq the group uses al-Najma and al-Qayara fields near Mosul. A number of smaller fields in both Iraq and Syria are used by the group for local energy needs.
According to estimates based on the number of oil tankers that leave Iraq, in addition to al-Araby’s sources in the Turkish town of Sirnak on the border with Iraq, through which smuggled oil transits, IS is producing an average of 30,000 barrels a day from the Iraqi and Syrian oil fields it controls.”
Unfortunately, like many reports on the topic, many of Al-Araby’s sources remain anonymous for their own safety. A member of the Iraqi intelligence services informed the reporters about the complex path the oil takes, traveling in dozens of tankers at a time into Zahko, a city controlled by Iraqi Kurds near the border with Turkey:
“After [Daesh] oil lorries arrive in Zakho – normally 70 to 100 of them at a time – they are met by oil smuggling mafias, a mix of Syrian and Iraqi Kurds, in addition to some Turks and Iranians,” the colonel continued.”
The gangs compete in sometimes deadly bidding wars to purchase and smuggle the oil onto the next stage, and “[t]he highest bidder pays between 10 and 25 percent of the oil’s value in cash — US dollars — and the remainder is paid later, according to the colonel.”
These “oil mafias” then bring the product to rudimentary refineries for simple processing from crude into oil, “because Turkish authorities do not allow crude oil to cross the border if it is not licensed by the Iraqi government,” the colonel explained.
Kurdish Smugglers and Turkish elite transport Daesh’s oil
Al-Araby’s sources reported that from Turkey the oil flows through three ports — Mersin, Dortyol and Ceyhan — into Israel. And from Israel, the oil seeps into Europe:
“According to a European official at an international oil company who met with al-Araby in a Gulf capital, Israel refines the oil only ‘once or twice’ because it does not have advanced refineries. It exports the oil to Mediterranean countries – where the oil “gains a semi-legitimate status” – for $30 to $35 a barrel.”
Reports also suggests that Daesh’s oil is not just passing through Turkish soil on its way to Israel, but also being aided in its journey by the country’s elite. A July investigation by AWD News accused Bilal Erdogan, son of Turkish president Recep Tayyip Erdogan, of owning one of the maritime companies responsible for shipping this contraband oil:
“Bilal Erdogan who owns several maritime companies, had allegedly signed contracts with European operating companies to carry Iraqi stolen oil to different Asian countries. Turkish government unwittingly supports ISIS by buying Iraqi plundered oil which is being produced from the Iraqi sized oil wells. Bilal Erdogan’s maritime companies own special wharfs in Beirut and Ceyhan ports transporting [Daesh]’s smuggled crude oil in Japan-bound oil tankers.”
However, an anonymous writer on ZeroHedge, an economic news website, noted on Nov. 30 that while Bilal Erdogan does seem to be moving Kurdish oil in his tankers, “we’ve yet to come across conclusive evidence of Bilal’s connection to [Daesh].”
In a Nov. 19 investigation, international security scholar and journalist Nafeez Ahmed, documented the mounting evidence of direct ties between Turkey and Daesh, noting that a Turkish daily reported that Daesh fighters had 100,000 fake Turkish passports, a number the U.S. Army’s Foreign Studies Military Office reported was likely exaggerated even as it corroborated reports of the flow of fake passports. Digging further, Ahmed cites a number of other credible reports, from a November Newsweek report that Daesh “sees Turkey as an ally,” to accusations of oil sales in Turkey from June 2014 by a member of Turkey’s opposition party, and leaked Turkish-language documents that show Saudi royalty shipped weapons to Daesh through Turkey.
An August report from Financial Times supports Al-Araby’s assertion that massive quantities of oil flow through the hands of Kurdish sellers into Israel. According to David Sheppard, John Reed and Anjli Raval, “Israel turns to Kurds for three-quarters of its oil supplies. They allege that Israel purchased about $1 billion in oil from the sellers between May and August of 2015.
In his analysis of the flow of oil, Shadowproof’s Dan Wright noted that Daesh seems “embarrassed” by the reports of oil sales to Israel. Al-Araby reported that “someone close to [Daesh]” reported via Skype:
‘To be fair, the organisation sells oil from caliphate territories but does not aim to sell it to Israel or any other country,’ he said. ‘It produces and sells it via mediators, then companies, who decide whom to sell it to.'”
Even without the potential ties to Daesh, Kurdish oil trading has proven controversial. The Iraqi government is struggling to put an end to the trade that they claim circumvents deals that were made to limit sales, while Kurdish officials claim the sales are necessary to maintain their financial independence. Iraq’s leaders are also threatening lawsuits against maritime shipping companies that accept Kurdish oil.
Russia weighs in on Erdogan oil smuggling
When Turkey shot down a Russian jet on Nov. 24, Russia responded by claiming the jet had been involved in an anti-terror mission targeting Daesh’s oil transportation infrastructure near the Turkey-Syria border:
“According to a press release from Russia’s Ministry of Foreign Affairs, [Sergei] Lavrov pointed out that, ‘by shooting down a Russian plane on a counter-terrorist mission of the Russian Aerospace Force in Syria, and one that did not violate Turkey’s airspace, the Turkish government has in effect sided with [Daesh].”
… The Russian Minister reminded his counterpart about Turkey’s involvement in the [Daesh’s] illegal trade in oil, which is transported via the area where the Russian plane was shot down, and about the terrorist infrastructure, arms and munitions depots and control centers that are also located there,”
Further complicating the tense international incident, WikiLeaks noted that a pseudonymous whistleblower on Twitter known as Fuat Avni claimed in October that Turkish President Erdogan was considering shooting down a Russian jet plane in order to leverage the resulting international tensions to boost his popularity both before and after recent elections.
RT reported that on Dec. 2, Russia’s Deputy Defense Minister Anatoly Antonov offered what he claimed was “proof concerning the illegal oil trade by [Daesh] and Ankara’s ties to it”:
“‘According to our data, the political leadership of the country [Turkey], including President Erdogan and his family, is involved in this criminal business,’ Antonov told the journalists in Moscow.”
Submitted by Tyler Durden on 11/30/2015 20:30 -0500, on ZeroHedge.com
Regular readers are by now well acquainted with Bilal Erdogan, the son of Turkish autocrat Recep Tayyip Erdogan. Although Erdogan senior masquerades as President of a democratic society, he is in reality a despot who just weeks ago, capped off a four-month effort to nullify an undesirable ballot box outcome by scaring the electorate into throwing more support behind the ruling AKP in a do-over vote designed specifically to undermine the pro-Kurdish HDP, which put up a strong showing in the last round of elections, held in June.
As the world’s interest in Islamic State’s illicit oil trade has grown over the past 60 or so days, so too has the scrutiny on how the group gets its stolen crude to market. In the seven days since Turkey shot down a Russian Su-24 near the Syrian border, Moscow has done its best to focus the world’s collective attention on the connection between ISIS and Turkey. It’s common knowledge among those who pay attention to such things that Ankara is part of an alliance that includes Riyadh, Doha, and Washington whose collective goal is to fund and arm the Syrian opposition. What’s up for debate is the extent to which that alliance supports ISIS and, to a lesser extent, al-Nusra.
Earlier today, Vladimir Putin explicitly accused Ankara of attempting to protect ISIS oil routes by shooting down Russian warplanes which have destroyed hundreds of Islamic State oil trucks in November.
Erdogan of course denies the allegations, but as we’ve shown, it would be very easy for Turkish smugglers to commingle ISIS and KRG crude (which, by the way, is also technically illegal), effectively using Kurdish oil to mask Turkey’s participation in the Islamic State oil trade.
Some contend that Bilal Erdogan’s marine transport company BMZ Group (which owns a Maltese shipping company) is involved in trafficking ISIS oil (see our full account here).
Here’s what Syrian Information Minister Omran al-Zoub said on Friday:
“All of the oil was delivered to a company that belongs to the son of Recep [Tayyip] Erdogan. This is why Turkey became anxious when Russia began delivering airstrikes against the IS infrastructure and destroyed more than 500 trucks with oil already. This really got on Erdogan and his company’s nerves. They’re importing not only oil, but wheat and historic artefacts as well.”
While we’ve yet to come across conclusive evidence of Bilal’s connection to ISIS, we would note that the Turkish port of Ceyhan is state-run and given Turkey’s extensive experience in smuggling KRG crude, it seems entirely fair to suggest that sneaking in 40,000 or so barrels of ISIS oil each day wouldn’t be that difficult a task. Indeed, given that Kurdish oil is, like ISIS crude, technically undocumented, Turkey will always have plausible deniability on its side (unless of course the oil is being moved into the country straight from Syria which is what Putin seems to be suggesting).
In any event, if Bilal Erdogan is in fact engaged in the trafficking of stolen crude (and take it from us, Baghdad will tell you that Kurdish crude sold independently of SOMO is every bit as illegal as Islamic State oil) it’s probably worth tracking BMZ Group’s fleet. Here’s a list of ships that Turkish or other regional media have at one time or another confirmed belong to Bilal:
You can track them all, free of charge at MarineTraffic.com:
Just don’t let Erdogan senior catch you monitoring his son’s fleet or you, like Can Dündar, editor in chief of Cumhuriyet, and Erdem Gül, the newspaper’s capital correspondent in Ankara, could end up sitting in a Turkish jail for 100 + 42 years.
petrol pulse 