Venezuela Ditches US Dollar, Will Use Euros For International Trade

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Venezuela has just taken the next step in its quest to “free” itself from the tyranny of US dollar hegemony. One year after the country said it would stop accepting US dollars as payment for its (ever shrinking) oil exports (saying the country’s state-run oil company would accept payment in yuan instead), Venezuelan Vice President for Economy Tareck El Aissami said Tuesday that Venezuela will officially purge the dollar from its exchange market in favor of euros. Continue reading

U.S. Crude Oil Exports Could Jump To Almost 4 Million Bpd By 2020

oil tanker

 

U.S. crude oil exports could increase to 3.9 million bpd by 2020, mostly driven by rising production in the Permian, the Houston Chronicle reported on Tuesday, citing a new report by S&P Global Platts.

U.S. crude oil exports are expected to reach 2.2 million bpd next year, according to the estimates. Continue reading

Saudis Planning For A War Of Attrition In Europe With Russia’s Oil Industry

Russia’s central bank recently warned about the growing financial risks to the Russian economy from Saudi Arabia encroaching upon its traditional export market for crude oil. Russia sends 70 percent of its oil to Europe, but Saudi Arabia has been making inroads in the European market amid the oil price downturn.

The result is a heavier discount for Russia’s crude oil, the so-called Urals blend. Bloomberg reported that the Urals typically lands in Rotterdam, a major European destination, at a discount to Brent of around $2 or less. But the discount has widened to $3.50 lately due to increased competition from Saudi Arabia. “Oil supplies to Europe from Saudi Arabia are probably adversely affecting Urals prices,” the Russian central bank warned in a recent report.

Russian officials have accused Saudi Arabia of “dumping” its oil in Europe, a move that Rosneft chief Igor Sechin said would “backfire.” Continue reading

How Much Longer Can OPEC Hold Out?

OPEC has been the most talked about international organization among investors, analysts and international political lobbies in the last few months.

When OPEC speaks, the world listens in rapt attention as it accounts for nearly 40 % of the world’s total crude output. With its headquarters in Vienna, Austria, one of the mandates of 12- member OPEC is to “ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers, and a fair return on capital for those investing in the petroleum industry.” (Source: opec.org).

However, OPEC has been in the line of fire from the western world in light of its stance of not reducing the production levels of its member nations (excluding Iran). Most view this as a strategy to squeeze the American shale production and other non OPEC nations. Continue reading

Russia prepares to attack the petrodollar

The US dollar’s position as the base currency for global energy trading gives the US a number of unfair advantages. It seems that Moscow is ready to take those advantages away.

Lately, China has led the BRICS efforts to dislodge the dollar from its position as the main global currency, but the “sanctions war” between Washington and Moscow gave an impetus to the long-awaited scheme to launch the petroruble and switch all Russian energy exports away from the US currency.

The main supporters of this plan are Sergey Glaziev, the economic aide of the Russian President and Igor Sechin, the CEO of Rosneft, the biggest Russian oil company and a close ally of Vladimir Putin. Both have been very vocal in their quest to replace the dollar with the Russian ruble. Now, several top Russian officials are pushing the plan forward. Continue reading

Europe Needs to Wean Itself From Russian Oil and Gas…and Fast

With tensions in Ukraine nearing a breaking point, the world is collectively looking to the Western powers for resolution. But, not surprisingly, the response so far has consisted of little more than a wag of the finger, with NATO and other world leaders unanimously condemning Russia’s military action in the Crimea.

While the reasons for this muted response are manifold, it’s difficult to ignore the leverage the Russians hold in this standoff. For starters, the U.S. and other Western powers have little to gain from bringing the Crimean conflict to a head; Russia, on the other hand, greatly benefits from controlling the region, with its strategic access to the Black Sea and concentration of Russian-speaking peoples. Continue reading

UPDATE 5-U.S. to overtake Saudi as top oil producer – IEA

Believing this one might be a difficult thing to uphold. The energy resources available aren’t disputed, but the actual motive to use them are. Most of the news the last four years reflects that the Obama administration has gone out of its way to close everything up it can (i.e. available shale oil land in Colorado via making national parks out of everything) and kill Canadian imported oil. Only time will tell what will come of this anomaly.

* U.S. to become biggest oil producer by 2017

* To overtake Russia as top gas producer by 2015

* Moving to become self-sufficient in energy (Adds details, para 8-9) Continue reading

Iran Says It Can Live Without Oil Money

Although it’s not known what “Plan B” would be, and being that oil revenues make up half of the government funding (as the article points out), a plausible guess would be on the exporting of nuclear energy since that progam is quite large and developed by now. Only time will tell.

Iran says it may stop exporting oil if international sanctions against it are intensified, adding that it has a contingency plan for running the country without oil revenues.

According to Reuters, Iranian Oil Minister Rostam Ghassemi told reporters in Dubai on Tuesday October 23: “If sanctions intensify, we will stop exporting oil.”

“We have prepared a plan to run the country without any oil revenues,” he added. “So far to date, we haven’t had any serious problems, but if the sanctions were to be renewed we would go for ‘Plan B’.” Continue reading

Iran And India: A Tangled Web Of Oil And Geopolitics

India and Iran have had a long relationship stretching back to ancient times. Iranian (or Persian) influence has produced a deep imprint upon Indian art, poetry, architecture and literature. With periodic invasions, military adventures and constant cross-migrations between the two empires, the people of Iran and northern India share many cultural and ethnic characteristics.

In the 21st century, the relations between these two great nations must be framed along the lines of geo-politics and oil, rather than art and culture.

Although India was greatly worried by the 1979 revolution in Iran that toppled the Shah and established an Islamic state, New Delhi and Teheran have generally enjoyed good relations. That tie became stronger with India’s insatiable appetite for energy in tandem with western sanctions that have pressured Iran to find customers for its crucial oil exports.

Indeed, India -which criticized the sanctions by the U.S., United Nations and European Union – recently became Iran’s top oil buyer.

Full article: Iran And India: A Tangled Web Of Oil And Geopolitics (International Business Times)

Iran Oil Exports Continue Off Radar

Iran continues to show that there is no bottom for third world economies.

Iran is trying to counter Western sanctions on its oil industry that aim to cripple Iran’s economy and convince it to acquiesce to Western demands regarding its nuclear program.

Reuters cites sources in the oil industry, trading and shipping who say the National Iranian Tanker Company has ordered all its captains to “switch off the black box transponders that are used in the shipping industry to monitor vessel movements.”

Full article: Iran Oil Exports Continue Off Radar (Eurasia Review)

Big US-Arab Gulf air force exercise draws Iranian warning to stop at once

Although the participants are keeping the exercise’s scenario under wraps, debkafile’s military and intelligence sources are able to outline its five segments:

1. A practice operation to pry open the Strait of Hormuz should Iran try to block the waterway through which one-fifth of the world’s oil is exported – whether by deploying warships, scuttling old vessels, strewing sea mines or firing shore-to-ship missiles from the Iranian-controlled islands of Abu Musa, Great Tunb, Lesser Tunb and Sirri Island.

The combined US-Gulf force is practicing air and naval assaults against those Iranian island bases and the Revolutionary Guards Corps’ mainland facilities facing them from Bandar-e-Abbas, Bandar-e-Lengeh and Qeshm island.

They plan to  cut off Iranian reinforcements en route to Hormuz.

2.   They also aim to prevent Iranian air or sea assaults on the Persian Gulf emirates’ oil facilities and export terminals, focusing mainly on Saudi, Bahraini and Kuwaiti oil facilities and fields.

3.  Air strikes are conducted against Iranian naval vessels, including speedboats, in a simulated exercise to head them off before they strike American aircraft carriers and warships or Gulf fleet vessels.

4.  Testing the degree of coordination between US air, sea and marine forces and their Persian Gulf counterparts.

5.  The Gulf exercise is in fact the sequel of Noble Dina 12, the US-Israeli-Greek war game conducted earlier this month in the Mediterranean and Aegean Seas. That war game practiced runs by Israeli fighter-bomber from their home bases to the big American facility on Crete, fueled in flight by American and Israeli tanker planes. The distance between the two points is roughly equivalent to the 1,200 kilometers between Israel and Iran.

Full article: Big US-Arab Gulf air force exercise draws Iranian warning to stop at once (DEBKAfile)

Iran stops oil sales to British, French companies

“Exporting crude to British and French companies has been stopped … we will sell our oil to new customers,” spokesman Alireza Nikzad was quoted as saying by the ministry of petroleum website.

The European Union in January decided to stop importing crude from Iran from July 1 over its disputed nuclear program, which the West says is aimed at building bombs. Iran denies this.

Iran’s oil minister said on February 4 that the Islamic state would cut its oil exports to “some” European countries.

The European Commission said last week that the bloc would not be short of oil if Iran stopped crude exports, as they have enough in stock to meet their needs for around 120 days.

Full article: Iran stops oil sales to British, French companies (Reuters)

What sanctions? Top five countries buying oil from Iran.

Third-world economies have no bottom, therefore sanctions are unlikely to be as hard hitting as most believe. There will always be another customer for oil.

Iran is the third-largest exporter of crude oil in the world, behind Saudi Arabia and Russia. Its economy relies heavily on oil exports. Recent Western sanctions have targeted Iran’s oil industry in hopes of pressuring Tehran to address international concerns about its nuclear program.

However, the effect of the sanctions could be limited if Iran’s top customers keep buying oil, or even increase their imports. According to tallies from June 2011, here are the top 5 importers of Iranian oil:

1. China

2. India

3. Japan

4. South Korea

5. Turkey

Full article: What sanctions? Top five countries buying oil from Iran. (The Christian Science Monitor)

Iran’s nuclear, terror offensives meet slow US-Israeli responses

Shrugging off Western sanctions and Israeli recriminations, Iranian President Mahmoud Ahmadinejad played a starring role in a widely televised spectacle by inserting his country’s first domestically-made fuel rod into the Tehran Research Reactor Wednesday, Feb. 15. The scene came after the announced cutoff of Iranian oil exports to six European countries – Netherlands, Spain, Italy, France, Greece and Portugal. Two hours later, the Iranian oil ministry challenged the announcement, spoiling the show by attesting to differences in high regime ranks.

By this show, Tehran thumbed its nose at Israeli Prime Minister Binyamin Netanyahu’s call on the world Wednesday to set red lines for Iran’s nuclear program and denounce its terrorist activity. “If Iran’s aggression is not halted, it will ultimately spread to other countries,” he told the Knesset.

Tehran paused only briefly in its multi-pronged offensive to deny Israeli charges of an Iranian hand behind the bombing attacks on its diplomats in New Delhi, Bangkok and the Georgian capital of Tbilisi this week, in which an Israeli woman was injured.

Full article: Iran’s nuclear, terror offensives meet slow US-Israeli responses (DEBKAfile)

Iran eyes banning oil sales to Europe

TEHRAN, Iran (AP) — Iran’s parliament will begin debating a draft bill requiring the government to immediately halt oil exports to Europe, a prominent lawmaker said Wednesday, as Tehran weighs its options following the European Union’s decision to stop importing oil from the country.

The EU embargo, announced on Monday, was the latest attempt to try to pressure Iran over a nuclear program the United States and its allies argue is aimed at developing nuclear weapons but which Iran says is for purely peaceful purposes. It came just weeks after the U.S. approved, but has yet to enact, new sanctions targeting Iran’s Central Bank and, by extension, its ability to sell its oil.

Many Iranian lawmakers and officials have called for an immediate ban on oil exports to the European bloc before its ban fully goes into effect in July, arguing that the 27 EU nations account for only about 18 percent of Iran’s overall oil sales and would be hurt more by the decision than Iran. China, a key buyer of Iranian crude, has blasted the embargo.

Continue reading article: Iran eyes banning oil sales to Europe (AP)