Tag: Libya

Kiran Stacey

It is a very dangerous game to try and predict what will happen next in the Middle East and North Africa at the moment, so I report this with all the usual caveats. But John Roberts, an energy security specialist at Platts, has been watching the region for a long time, and he thinks that the possible removal of Muammar Gaddafi blows apart a lot of long-held assumptions about the region.

The key assumption as far as Libya was concerned was that with high oil revenues and a small population, Gaddafi was safe. If trouble started, he could always bribe people into remaining quiet – as he appears to have done recently, reportedly increasing wages and loans on offer to Libyans.

Breaking at pixel time — Reuters quoting an Italian government source that ‘informal’ Opec talks have begun on raising output if Libyan supply collapses (only for the Saudi oil minister to deny that Opec will consider extraordinary talks.)

Which is precisely what the supply has been doing (the country’s gas exports aren’t looking too hot either). Italy has every incentive to do something about it of course, given its ample Libyan exposure in both resources.

Kiran Stacey

Colonel Gaddafi’s rather strange television appearance last night failed to quell the Libyan insurrection, and this morning has seen a mounting number of oil companies depart the country and the oil price continue to surge.

The news for Opec in the short term is bad, with Libya currently accounting for 1.6m barrels a day of oil production. In the long term, it could be even worse, however, especially if trouble spreads to Kuwait, with 2.3m b/d, Iran, with 3.7m, or even the big one – Saudi Arabia, with 8.3m.

As the Great Socialist People’s Libyan Arab Jamahiriya comes crashing down, despite regime attempts to butcher demonstrators — here’s a timely reminder on corporate exposure.

Much of it, as you’d expect, is concentrated in oil production. (Output at the country’s Nafoora oil field had stopped on Monday due to strikes, incidentally.)

Kiran Stacey

BP’s partnership with Rosneft was remarkable for a number of reasons, not least that it was done against the wishes of BP’s partners in TNK-BP and was the first equity partnership between a private international and a public national oil company. It is also a partnership not limited to developing Russian assets only: the two parties have a 50/50 ownership of Ruhr Oel, a German refining joint venture.

Ian Smale, BP’s group head of strategy and policy, told an audience in London on Monday that the two companies would be looking at further JVs outside Russia, and described the arrangement as an example of how IOCs and NOCs could form closer partnerships in future.

Kiran Stacey

Protests in LibyaAs protests move from the east of Libya towards its capital Tripoli, triggering the decision by BP to suspend some of its operations in the country, markets are nervously watching the oil price.

According to David Fyfe, the International Energy Agency’s head of oil industry and markets division, around 50,000 barrels per day of crude production have been shut in because of the anti-Gaddafi protests and the regime’s response to them.

Brent Crude chartSo concerned is the IEA that Fyfe felt the need to remind delegates at International Petroleum week, which started in London today, that his organisation was sitting on 1.6bn barrels of publicly-held crude stocks, which it could tap if supplies were seriously interrupted.

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