U.S. WANT RUSSIA'S MARKET SHARE
BLOOMBERG - The expansion of Russia's gas pipeline to Germany under the Baltic Sea, which bypasses a number of east European nations, will allow the Kremlin to use energy as a "political tool," U.S. Secretary of State Rex Tillerson said in Warsaw.
Tillerson, speaking to reporters after meeting with Poland's Prime Minister Mateusz Morawiecki on Saturday, said Europe should seek to diversify energy supplies. The U.S. saw the contested Nord Stream 2 link as "undermining Europe's overall energy stability and security," he said.
NATO member Poland has repeatedly tried to bloc the deal, saying it would leave countries such as itself and Ukraine vulnerable if Russia decided to shut down the gas pipelines running across its territory to western Europe. Foreign Minister Jacek Czaputowicz said Poland wanted U.S. help in stopping Nord Stream 2, which is being built by Russian gas giant Gazprom PJSC.
"It's not a helpful piece of infrastructure to support stability in Europe," Tillerson said. "We will continue to take steps as we can."
The top American diplomat said his country is ready to help Poland continue to diversify its fuel supplies, including through the sale of U.S. liquefied natural gas, to reduce its dependence on Russia. Tillerson also said the U.S. will maintain support for Polish plans to build a gas-pipeline connection with the North Sea together with Denmark. Additionally, he's in favor of increasing links in the energy network between the Baltic and Adriatic seas.
Besides joint efforts in the energy industry, Poland's foreign minister said he was hopeful for more military cooperation with the U.S., after it installed troops in the former Communist country as part of a plan to better protect NATO's eastern flank. Czaputowicz said Poland wants to complete negotiations "soon" and sign defense deals with the U.S, including protracted talks about the delivery of the Patriot missile-defense system as well as Blackhawk helicopters.
Later on Saturday, Tillerson met the ruling Law & Justice party's leader, Jaroslaw Kaczynski, who holds no official post.
"For me it's an opportunity to hear from one of the local leaders" who has a "long history in the development of Poland in the last 20 years," Tillerson said.
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U.S. FRB - Industrial production edged up 0.1 percent in July after rising at an average pace of 0.5 percent over the previous five months. Manufacturing production increased 0.3 percent, the output of utilities moved down 0.5 percent, and, after posting five consecutive months of growth, the index for mining declined 0.3 percent. At 108.0 percent of its 2012 average, total industrial production was 4.2 percent higher in July than it was a year earlier. Capacity utilization for the industrial sector was unchanged in July at 78.1 percent, a rate that is 1.7 percentage points below its long-run (1972–2017) average.
NPD - Preliminary production figures for July 2018 show an average daily production of 1 911 000 barrels of oil, NGL and condensate, which is an increase of 64 000 barrels per day compared to June.
GAZPROM NEFT - For the first six months of 2018 Gazprom Neft achieved revenue** growth of 24.4% year-on-year, at one trillion, 137.7 billion rubles (RUB1,137,700,000,000). The Company achieved a 49.8% year-on-year increase in adjusted EBITDA, to RUB368.2 billion. This performance reflected positive market conditions for oil and oil products, production growth at the Company’s new projects, and effective management initiatives. Net profit attributable to Gazprom Neft PJSC shareholders grew 49.6% year on year, to RUB166.4 billion. Growth in the Company’s operating cash flow, as well as the completion of key infrastructure investments at new upstream projects, delivered positive free cash flow of RUB47.5 billion for 1H 2018.
REUTERS - Front-month Brent crude oil futures LCOc1 were at $72.34 per barrel at 0648 GMT, down by 12 cents, or 0.2 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 23 cents, or 0.3 percent, at $66.81 per barrel.