Latest U.S. energy plan wastes deficit opportunity 13 May 2010 By seeking to craft a painfree energy bill, lawmakers in the Senate telegraphed that any efforts to raise revenue are taboo. It's another worrisome sign that only the bond market's vigilantes will ever get Congress to act on the budget gap.
Changing liability rules on BP would be unfair 7 May 2010 The oil major's critics in Washington want to increase more than 100fold a $75 mln cap on its legal liability beyond the cost of cleaning up its Gulf spill. The ceiling seems absurdly low. But BP is resigned to paying more and retroactively raising the cap would be overkill.
Investor assault on Transocean looks like overkill 6 May 2010 Deep sea driller Transocean has justly been set in the stocks alongside BP over the spill. But bashing the rig owner more brutally than BP, as investors have done, seems odd. A $6 bln slide in value looks excessive for a wellinsured firm with strong prospects.
Oil watchdogs slept beside banking brethren 4 May 2010 Regulators are often accused of being in bed with industry even literally in the oil sector. The BP spill fiasco suggests they trusted tiny track records and deferred to Big Oil on the safety of new technology. Bankers aren't the only ones who need more vigilant oversight.
BP’s big price decline may not be irrational 4 May 2010 The oil major's market cap is down $29 bln, more than three times the highest estimates of its cleanup costs for the big spill in the Gulf of Mexico. Investors hate uncertainty and often overestimate calamities. But this slick could well cover BP with costly collateral damage.
Aussie tax approach risks world resource shortages 3 May 2010 Australia's proposed 40 pct resource super profits tax risks doesn't just legitimize thirdworld profits grabs. By suppressing mining profits peaks, it could reduce goldrush exploration activity when prices are high. That, in turn, might exacerbate resource cycles.
Oil industry risks a Luddite backlash from public 3 May 2010 Even if BP's spill comes down to human error, the disaster could cast a long shadow over deepsea drilling. Freak accidents derailed nuclear power and gene therapy and killed the Concorde. Pricier insurance and more regulation is the least the oil industry can expect.
BP makes itself easy to demonise 3 May 2010 The UK oil major is under attack from all sides over the horrendous Gulf of Mexico oil spill. BP may feel it can never win the PR war. But a more contrite tone, less talk of its overthetop response, and more explanation of its contingency planning, would help.
Lifting of refining curse allows Big Oil to shine 29 Apr 2010 It s not just a doubling of crude prices this year that is giving a healthy glow to U.S. producers like Exxon and Conoco. The refining sector, which recently splattered their accounts in red ink, is looking less bloody. Exploration and production profits can take center stage.
Worsening BP Gulf spill spells trouble for rivals 29 Apr 2010 Investors haven't knocked down the shares of other oil majors. Given the growing significance of deep sea drilling, this seems too sanguine. As the slick grows, plans for offshore drilling in the U.S. face questions and similar operations worldwide will come under scrutiny.
Cape Cod wind farm is a losing battle for greens 28 Apr 2010 Victory in a 9year battle to win federal approval for a wind farm off the Massachusetts coast is not the end of the story. Wealthy denizens of the coast may still scupper the project. Given the poor economics of offshore wind, greens should choose more promising territory.
U.S. oil shale ripe for interest from majors 28 Apr 2010 Multinational oil groups have paid up for late entry to the U.S. shale gas party. Yet oil shale deposits, though less enormous, could deliver quicker profits. The danger for the majors once again is waiting so long that the alreadyoperating independents can name their price.
Putin puts geopolitics before economics 27 Apr 2010 A proposed nuclear partnership with Kiev is the latest example of Russia trading cash for influence. An expensive new gas pipeline will tighten the country's energy grip on Europe. Even if the politics are sound, Russia may not be able to afford all of these power plays.
Big oil spill may not just be BP’s problem 27 Apr 2010 The UK oil and gas major has responded aggressively to a fatal explosion in the Gulf of Mexico. BP is well aware of reputational risk, having spent five years rebuilding its own. Investors should be worried too, by the costs and the potential backlash on deep sea exploration.
Gas sitting prettiest in fossil fuel love triangle 23 Apr 2010 Natural gas has rarely been priced so keenly. It offers three times more energy per dollar than oil, and is rivaling cheapbutdirty coal. Investors in shale gas may hope for higher prices but if that doesn't happen, gas could still gain by displacing its fellow fossil fuels.
Essar Energy IPO raises governance issues 22 Apr 2010 The current board will be dominated by the Ruia family which will also retain a 75 pct stake. It's great that Essar Energy plans to appoint another independent director but unfortunate that this won't happen before the London listing.
Ukraine’s new government makes progress 22 Apr 2010 President Yanukovich has traded a Black Sea naval lease renewal for a $4 billion annual saving on Russian gas. That should clear the way for a $12 billion IMF loan. But Yanukovich still has to face his biggest test: straightening up the deeply troubled domestic economy.
Schlumberger’s Iraq ramp-up could soften oil price 19 Apr 2010 Maybe not immediately. But signs of oil services companies at last investing in the volatile country mean gasguzzlers everywhere can rest a bit easier. If its huge oil reserves can now be safely tapped, Iraq could be on the way to joining Saudi Arabia as a key swing producer.
Oil’s scarcity has become Wall Street’s gain 14 Apr 2010 The fees generated by dealcrazy oilmen have always been juicy. But the recent flurry of hookups $130 bln so far this year is once again making them the most valuable clients for the big banks. Energy bankers are likely to remain in high demand even if oil stumbles.
Conoco defies deal curse with oil sands sale 12 Apr 2010 The U.S. energy group has a rap of buying at the top, particularly after the poorlytimed Burlington purchase. The $4.65 bln sale of its Syncrude oil sands stake should help restore its reputation for canny dealmaking. Conoco s debt mountain is starting to look less imposing.