A wise step of Russian ministers in introducing a new tax regime to drop oil export duties beginning from Oct1 will add a new script in the history of Russia. However, the final decision depends on the consent of Prime Minster, Vladimir Putin. Continue reading
The future looks promising to ‘Statoil’, a Norwegian Energy Company which discovered a large oil field in the North Sea. This is the largest oil field discovered in the North Sea in the last 30 years. Continue reading
AP Photo/Hasan Jamali
A fall in oil prices might give Americans some relief while driving their cars more but along with it, it will shake their confidence about American economy.
Oil prices per barrel settled at about 30 percent less than the high in the April of last year. Sinking prices of oil indicate lowering costs in most parts of U.S. But when the backbone of the country, the economy seems to be frail, consumers tend to spend less on consumer goods though they are available at a relatively cheap price. Though the oil prices have reduced, consumers and businesses are spending less on the oil and diesel, the unspent money is likely to go into the savings and will not flow in the market freely due to frail economy.
Obama administration’s decision to strike a last minute debt deal to raise the government’s debt limit has effected oil prices over the world as they rose to above $97 a barrel on Monday in Asia. Continue reading
Oil platform
As a result of fall in the prices of crude oil and weakening of US dollar, investors are looking forward to purchase oil in other currencies. After the decline of the West Texas Intermediate September contracts, Crude oil price has fall down by 65 %. Its value has become $99.22 per barrel as indicated by the New York Mercantile Exchange (NYME). On the other hand, Brent crude has fallen down by 56% which became $118.11 per barrel according to the ICE Futures Europe exchange, London. Continue reading
AP / Rick Bowmer
The release of emergency oil reserves by the IEA which sent shock waves throughout the oil and foreign exchange market is set to be reviewed by the IEA at the end of this week. It is estimated that there could be another such release within this year at some point. There are some countries are either hesitant or in direct opposition against this measure by the IEA at least for now.
No matter what the IEA decides, the United States is can release more oil to the market from its strategic reserves. The United States was responsible for the release of half of the 60 million barrels of oil released to the oil market. In the long run of IEA for the last 37 years, this was only the third time that it announced the release of its emergency oil reserves. This measure by the IEA caused the oil market a sell-off of about 6%.
The US dollar index rose by 0.9 % emphasising the negative relation between oil prices and the US currency. The oil prices have since then recovered. Brent crude oil rose to 116$ per barrel as opposed to the 114$ per barrel prior to the release of emergency reserves. For most of the year 2009 while the world was emerging from recession the negative correlation between the US currency and oil prices was sustained. An economic boost was provided by availability of cheap money to the world economy. This created a frenzy of buying in dollar denominated assets while weakening the US dollar. Oil became cheap to other currency holders opposed to US currency holders.
The OPEC (Organization of Petroleum Exporting Countries) has cause to raise oil prices to protect its dollar income, which it may choose to do against a weakened dollar. The QE2 (US quantitative easing) aided in maintaining a sustained market oil market in the second round. The second round commenced last year in the final quarter and gained impetus after Libyan oil supply was halted due to the civil war.
Ben Bernanke, the chairman of Federal Reserve Bank has proposed further quantitative easing if economic growth and inflation has slackened. This move could further weaken the US dollar. The negative relation between US dollar and oil prices could be curtailed by the fear that rising oil prices is lowering demand particularly in the US which is the largest world market for oil but constitutes a frail economy.
As per market scenario, an oil driller predicted that about 190,000 jobs are likely to be created if offshore production in the United States returns to pre-BP blowout levels. Continue reading
A Shoreline Cleanup Assessment Team (SCAT) discovers oil debris attached to an oyster shell on the shoreline of Raccoon Island, May 12, 2010. (US Navy / Jonathen E. Davis)
The NIEHS (National Institute of Environmental Health Sciences) has funded a group of researchers to assess the long-term harmful effects of the Deepwater Horizon disaster on Gulf seafood and health of people. This includes deep study and evaluation of the physical and mental well being of the concerned person and any adverse effects caused due to possible contamination of air, water and food. Continue reading
Thomson Airways will be the Britain's first airline to fly on biofuel
Thomson Airways will be the first British Airline to fly on biofuel made up of cooking oil used in the kitchen. This is a remarkable step toward environmental protection particularly in the history of aviation industry. Continue reading
WN photo
The announcement of the release of emergency stock piles by the IEA caused Brent crude prices to go upward at $108 per barrel. US crude oil too reached at $91.97 per barrel. Continue reading