SANCTIONS: ANYTHING CONCRETE
Sanctions are forcing Exxon Mobil Corp. to look for alternative assignments for an offshore rig supposed to sail back to the Russian Arctic next summer, writes Bloomberg.
West Alpha, the rig owned by billionaire John Fredriksen's North Atlantic Drilling Ltd. (NADL) that made a billion-barrel oil discovery for Exxon and OAO Rosneft (ROSN) in the Kara Sea in September, could end up operating offshore Norway instead of going back to Russia in 2015, said Dominic Genetti, operations manager for Exxon in Norway.
"We're looking at alternative uses in Norway, but we haven't landed on anything concrete at this point," he said today in an interview in Stavanger, on Norway's west coast. "We have to wait and see what happens with the joint venture and sanctions. We'll follow whatever the international and U.S. laws are, and that will determine where it goes."
North Atlantic, a 70 percent owned subsidiary of Seadrill Ltd., both based in Hamilton, Bermuda, slid as much as 26 percent, the most since listing in New York in January, and closed 20 percent lower at $3.16 a share, the lowest on record.
The U.S. and the European Union deepened sanctions in September to punish Russia for its support of separatists in eastern Ukraine. The sanctions seek to constrain Russia's financial, defense and energy industries, restricting access to markets and the export of technology for Arctic, deepwater and shale-oil exploration and production, where Russian companies rely on western know-how and equipment.
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REUTERS - Brent crude futures LCOc1 were down 72 cents at $61.49 per barrel at 1020 GMT, having fallen by 1.5 percent on Tuesday, its largest one-day drop in a month. U.S. West Texas Intermediate (WTI) crude CLc1 was at $55.12 per barrel, down 58 cents.
BLOOMBERG - Prices dropped during the session as the International Energy Agency said the recent recovery in oil prices, coupled with milder-than-normal winter weather, is slowing demand growth. The worsening outlook for consumption dampened some of the enthusiasm that OPEC and its allies will extend supply curbs.
Global energy needs rise more slowly than in the past but still expand by 30% between today and 2040. This is the equivalent of adding another China and India to today’s global demand.
Product exports have grown significantly over the past several years and are expected to continue to grow as Russian refineries add capacity to produce more high-quality products.