Page 10 - LatAmOil Week 36

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Mideast: Export facilities come into focus to see mixed signals, with weekly US rig counts
Export infrastructure came into sharp focus creeping up for only the second time since early
this week as news emerged of talks to extend the March, but crude prices declining. The West
planned oil pipeline between Iraq and Jordan Texas Intermediate (WTI) benchmark dropped
to Egypt. The discussions also involve collabo- below $40 per barrel in recent days, which has
ration in the field of electricity, and follow talks been attributed to a number of domestic factors,
about the grid interconnectivity among several as well as international trends as Saudi Arabia
of the region’s countries. announced that it would cut prices for its Octo-
For Iraq, the move to increase westward oil ber sales.
flows will ease dependency on Gulf terminals. While some North American producers are
These facilities handle the vast majority of the better positioned to ride out the storm than oth-
country’s exports, including no less than 86% of ers, concerns remain about the ability of small
all August shipments. Meanwhile, Amman and companies in particular to survive. Last week,
Baghdad have agreed to resume trucked crude Western Canadian firms that produce around
exports in response to the oil price drop and the 20,000 barrels per day (bpd) were described as
coronavirus (COVID-19) pandemic. “an endangered species” by the head of a private
In Iran, authorities have said that the Jask equity firm. Iran is seeking
oil terminal project will be ready for operation Such private equity players are among those to expand its
by the end of March 2021, enabling the Islamic seeking to capitalise on the downturn by buying
Republic to export crude without needing to up struggling companies at bargain prices, and capabilities
traverse the Strait of Hormuz. Iran has period- more acquisitions are expected in the coming
ically threatened to block the s trait if its crude weeks and months. ahead of a
exports are unacceptably harmed by US sanc- In the US, meanwhile, the upcoming presi-
tions, while Washington has said such a move dential election is generating further uncertainty potential easing
would require a response. in an operating environment already contending of sanctions
As Iran seeks to expand its capabilities ahead with numerous unknowns. Democratic nomi-
of a potential easing of sanctions, local firm nee Joe Biden clarified his position on hydraulic
Petroleum Engineering and Development Co. fracturing last week, saying he would not seek
(PEDEC) announced that it had increased oil to ban the practice if he were to be elected to the
production capacity at the South Yaran oilfield presidency in November.
by 5,000 barrels per day (bpd) following the Biden’s comments came in response to alle-
installation of a new mobile oil separator (MOS). gations by US President Donald Trump that the
The head of the South Yaran project emphasised Democratic nominee would indeed seek to ban
the importance of the MOS being locally built, fracking. Biden made the assurances during a
noting that it was the first time a domestically speech in the swing state of Pennsylvania, which
produced MOS had been installed in the West is a leading shale gas producer. Biden’s climate
Karoun oil region. change plan calls for ending new oil and gas
leases on public land, but it would not ban drill-
If you’d like to read more about the key events shaping ing or prohibit any specific method for produc-
the Middle East’s oil and gas sector then please click ing fossil fuels.
here for NewsBase’s MEOG Monitor.
If you’d like to read more about the key events shaping
Quarterly losses mount in North America the North American oil and gas sector then please click
North America’s oil and gas industry continues here for NewsBase’s NorthAmOil Monitor .™

P10 www. NEWSBASE .com Week 35 03•September•2020