Oil probe shows the slippery nature of prices 16 May 2013 Even if the EU probe into the manipulation of published energy prices comes to nothing, it highlights a strange market. In the global energy trade, billions of dollars change hands on the basis of “best guess” benchmarks. More is at stake than fines for rogue traders.
Oil price collusion would be a Libor-scale scandal 14 May 2013 EU authorities are probing whether traders in oil majors conspired to rig published energy prices. Oil benchmarks are supposedly harder to manipulate than bank rates, so this could be a big deal. Even if no collusion is found, it makes a review of arcane price-setting mechanisms more urgent.
Oil patch excesses tar all players with same brush 14 May 2013 Continental’s board reckons it struck the best deal possible when committing $96 mln to a pipeline its own CEO is building. But rival firms’ governance abuses make that hard to swallow. Eschewing all side deals with company bosses is the best way to avoid the taint of conflicts.
Review: Ideology pollutes U.S. oil and gas debate 10 May 2013 Fracking and the sliding cost of renewable energy offer America a chance to curb reliance on foreign fuels and boost growth. But pointless partisanship puts these gains at risk, says Michael Levi in “The Power Surge.” Democrats and the GOP can at least agree to avoid mutual sabotage.
Shell must hope Voser successor mimics his ways 2 May 2013 The outgoing CEO’s anti-bureaucratic style and distaste for corporate adventurism put the Anglo-Dutch major back on course after its 2004 reserves scandal. His tenure shows how the steady approach benefits resource shareholders. Too bad the board couldn’t keep him in post.
Chesapeake’s revival hampered by fire-sale prices 1 May 2013 The U.S. energy explorer trimmed costs after ousting spendthrift boss Aubrey McClendon. That, along with strong oil output, helped it beat Q1 forecasts. But Chesapeake still piled on $1.3 bln more debt, which may necessitate selling more energy-rich land at not-so-awesome prices.
BP’s Russian honeymoon isn’t the end of the story 30 Apr 2013 The UK major’s results show a turnaround strategy that is gaining momentum. The first profitable days as 20 percent owner of Russian oil giant Rosneft are welcome. How boss Bob Dudley’s manages the new relationship is key to whether BP can shrink to greatness, or just mediocrity.
Oxy gets religion only after boss has had his fun 29 Apr 2013 Allowing ex-CEO Irani to remain chairman at $46 mln a year caused turmoil at oil firm Occidental. In future, the board says, outgoing chiefs will be shown the door. Shareholders may cheer. But oil executives are often only willing to do the right thing as they prepare to leave.
Hot Aussie economy could tarnish Chevron’s future 26 Apr 2013 The oil giant is poised for better output growth than rival Exxon. But it is more active Down Under, where a strong currency and a crowded market have pushed the cost of its shared Gorgon LNG project up 40 pct to $52 bln. Runaway capex is a risk to an otherwise bright outlook.
Exxon Mobil running hard just to stand still 25 Apr 2013 The world’s biggest company is pumping just 3 pct more oil than it was 12 years ago. Yet Q1 results show capital spending rising fast. Only buybacks are making earnings per share growth look decent. Justifying Exxon’s valuation premium to peers is getting harder.
Oxy could take value-creation lessons from Conoco 24 Apr 2013 The move by Conoco to break in two a year ago is being vindicated. Shares in its two components have beaten peers by nearly 20 pct since the separation. Occidental, hit by rising costs and an executive feud, should take note. Matching Conoco’s lift would unlock a $12 bln gain.
New oil dynamics may challenge crude growth logic 19 Apr 2013 Fears for the wobbly world economy have pushed Brent below $100 a barrel. Cheaper energy helps industry. Better still, booming shale output, greater efficiency and the rise of natural gas as a rival transport fuel may keep the oil price subdued even as growth is stimulated.
Floating LNG offers good economics, tough politics 15 Apr 2013 Woodside Petroleum is the latest energy group to examine building a floating gas facility to salvage an otherwise uneconomic mega-project. The cost savings could be substantial. But the newfangled technology creates fewer jobs than onshore LNG. Host governments won’t like that.
Chavez successor unlikely to prove as durable 15 Apr 2013 Nicolas Maduro has won a six-year term as Venezuela’s president, if Sunday’s vote count stands. But with debt and subsidies eroding oil riches, inflation at 22 pct and two currency devaluations already this year, a crisis could undermine his narrow majority long before 2019.
Eike Batista might be too big to fail 11 Apr 2013 As the billionaire fights to shore up his embattled EBX empire, Brazil’s state-controlled oil giant Petrobras is considering a lifeline of sorts. It would probably be in the form of port deals. For the government to step in, even indirectly, shows how influential he has become.
More resource transparency welcome, warts and all 10 Apr 2013 Forthcoming rules will require EU oil and mining companies to publish details of project-by-project dealings with governments. It will create extra work and may disadvantage Western producers. Still, the benefits of extra transparency should far outweigh the costs.
Occidental shows why ex-CEOs don’t belong on board 9 Apr 2013 Reports suggest the oil company’s chairman and former chief executive is pushing to oust current boss Stephen Chazen. Tension between the two was predictable. Avon and others have shown no good comes from letting predecessors hang around. The board needs a better succession plan.
Is Exxon building Big Oil’s skyscraper equivalent? 5 Apr 2013 The oil giant is planning a $24 bln floating facility to process gas. By the time this monster island is finished, the world could be awash in cheaper energy. It may one day resemble the towering edifices constructed on land that heralded market plunges and economic downturns.
BP already facing test of new Russia strategy 2 Apr 2013 After the sale of TNK-BP, the UK major owns 20 percent of Rosneft. Now BP must avoid becoming just another trampled Russian minority shareholder. It could start by using its new clout on Rosneft’s board to push for fair treatment of TNK’s minority investors.
Latest oil spill blame games miss the point 1 Apr 2013 Environmentalists reckon an Arkansas leak bolsters their case against the Keystone pipeline. Proponents point to a recent train crash to show other ways of ferrying crude are accident-prone, too. What counts is keeping such risks to a minimum. On that score, Keystone looks sound.