Saudi Arabia aims to create the world’s largest fleet of oil tankers following the establishment of a new US $1.5 billion investment fund by Arab Petroleum Investment Corporation, (Apicorp), and National Shipping Corporation of Saudi Arabia (Bahri).
Under the Apicorp Bahri Oil Shipping Fund venture announced yesterday, fifteen very large crude carriers (VLCCs) would be added to the shipper’s expected fleet of nearly fifty such vessels over the next two years. Bahri currently owns 36 VLCCs and plans to add ten more by 2018. Continue reading
Oil markets may not balance until late 2016, but supply is finally contracting in a big way.
Early last week the EIA confirmed that U.S. oil production was down sharply since peaking in April at 9.6 million barrels per day (mb/d). The agency estimates that U.S. output fell by 140,000 barrels per day in August, a steeper decline than in previous months. In its latest weekly estimate (which is less accurate than monthly retrospective estimates), U.S. oil production is now down to just 9.1 mb/d. Continue reading
Demand for oil will strengthen this year, according to OPEC, as the cartel said its strategy of pumping oil into the market to squeeze out US producers was taking effect.
The Organisation of the Petroleum Exporting Countries, which pumps a third of the world’s oil, believes demand will average 29.27m barrels per day (bpd) in 2015, representing an increase of 80,000 bpd from its previous prediction.
When OPEC decided on Nov. 27 not to reduce production below a nearly 3-year-old cap of 30 million barrels a day, the losers were producers such as the United States, whose boom in shale oil requires expensive extraction methods, and Russia, whose economy relies perhaps too heavily on energy. Even OPEC members will see losses of revenue, especially those outside the oil-rich Persian Gulf.
The effect on China, though, is mostly beneficial. China doesn’t make money on oil, it buys it, relying on imports for almost 60 percent of its domestic oil supply, and is the world’s largest net importer of oil. And the lower the price of oil, the more affordable it becomes for China to develop its economy, which is now in a period of slow growth. Continue reading
Saudi Arabia has secretly offered Russia a sweeping deal to control the global oil market and safeguard Russia’s gas contracts, if the Kremlin backs away from the Assad regime in Syria.
Leaked transcripts of a closed-door meeting between Russia’s Vladimir Putin and Saudi Prince Bandar bin Sultan shed an extraordinary light on the hard-nosed Realpolitik of the two sides. Continue reading
One of the main points of discussion at last week’s high-level forum on defense and security in Berlin centered on raising the military protection of Germany’s raw materials sources.
Broadcast live via the government-financed media outlet Deutsche Welle, the forum—hosted by Berlin’s Federal College for Security Studies (baks)—had, as a top item on its agenda, ways and means of adding to the Bundeswehr’s existing presence in Africa within countries that are vital to the continuing supply of raw materials for Germany’s export-led economy. Continue reading
Newly-elected Prime Minister Mian Muhammad Nawaz Sharif, in his maiden speech, revealed that Islamabad and Beijing have expressed a keen desire to implement the Gwadar-Khunjerab-Kashgar rail network. The project had been discussed during talks with Chinese Premier Li Keqiang in his recent visit to Pakistan.
While PM Sharif said the actual details of the project would be shared at a later date, he also stated that both countries will soon establish a taskforce to complete the project within the next five years, indicating that it may be implemented on a fast-track basis.
The successful implementation of the Gwadar-Khunjerab-Kashgar rail network will help China secure oil supply and commercial routes on the Indian Ocean, furthering its plans to secure yet another strategic energy and trade corridor. Besides, the project is expected to provide a major boost to Pakistan’s sinking economy. Continue reading