Energy Minister Alexander Novak said Russia would continue to comply with the OPEC crude oil production cut agreement until the end of this year and even into 2019 if need be.
China’s yuan-denominated crude oil futures market opened on the Shanghai Exchange this week marking the culmination of a decade-long push by the Asian country to have more control over the pricing of crude sold to Asia. China’s ultimate goal is to create a yuan-denominated global crude benchmark. The initial focus will be on Basrah Light crude oil, given it is the most abundant of the grades that are acceptable for delivery. The Shanghai market will compete with West Texas (WTI) and Brent crude oil markets. The Shanghai Futures Exchange announced last week that it had set the opening price for the front month of its crude futures contract at $65.80 per barrel. The experiment will determine if the yuan will gain traction in the world oil market.
Offshore the West African country of Senegal, FAR Ltd. and its partners have found an estimated 840 million barrels of crude oil. FAR has drilled 11 successful wells to date.
Natural gas from basins in southeastern Siberia in Russia could start moving through a natural gas pipeline to China within the next five years, Gazprom announced. The Kovyktinskoye field near Irkutsk has a large volume of estimated gas reserves. Current plans are to start feeding gas from Kovyktinskoye into the Power of Siberia gas pipeline in late 2022 for delivery to China.
Germany wants to build a liquefied natural gas (LNG) industry from scratch to reduce that nation’s dependence on natural gas imported from Russia and Norway. The country is investigating all initiatives that would diversify its gas supply — whether from different regions or the means of transporting gas. With natural gas resources from the UK and the Netherlands depleting, Germany is forced to rely more on Russian gas as its primary supply.
The US exported more natural gas than it imported in 2017, marking the first time since 1957 that the US has been a net natural gas exporter. The US surpassed Russia in 2009 as the world’s largest natural gas producer as shale gas production drove overall increases in natural gas production. Natural gas production reached an average of 73.6 billion cubic feet per day during 2017.
China has a new mandate that gasoline in the country must contain 10% ethanol by 2020. Ethanol consumption in China would at least quadruple in the next three years due to this nationwide mandate.
With Europe and other areas introducing tighter restrictions on sulfur emissions in coastal waters, the owners of 60,000 cargo ships are forced to make major investment decisions. They can either buy ships that are cleaner-burning or invest in a device that treats the existing ship’s exhaust. Retrofitting a marine vessel with a sulfur-trapping exhaust system called a “scrubber” costs as much as $10 million a ship, while cleaner fuels (biofuels, biodiesel, liquefied natural gas or LNG) are some 55% more expensive than diesel oil.
In seven of the past ten years, electricity generation in the US has declined. In 2017 electricity generated by the electric utility industry fell 2.1%.
German intercity bus company FlixBus will be testing Chinese electric buses on long-distance routes for the first time in the world. The first all-electric bus trip will begin in France between Paris and Amiens, France in April. The electric buses are made by China’s Zhengzhou Yutong and BYD.
with h/t Tom Whipple
