Tag Archives: NGS

Business

Storm cuts U.S. oil, gas, power output, sending prices higher

Leave a comment

Dec 23 (Reuters) – Frigid cold and blowing winds on Friday knocked out power and cut energy production across the United States, driving up heating and electricity prices as people prepared for holiday celebrations.

Winter Storm Elliott brought sub-freezing temperatures and extreme weather alerts to about two-thirds of the United States, with cold and snow in some areas to linger through the Christmas holiday.

More than 1.5 million homes and businesses lost power, oil refineries in Texas cut gasoline and diesel production on equipment failures, and heating and power prices surged on the losses. Oil and gas output from North Dakota to Texas suffered freeze-ins, cutting supplies.

Some 1.5 million barrels of daily refining capacity along the U.S. Gulf Coast was shut due to the bitterly cold temperatures. The production losses are not expected to last, but they have lifted fuel prices.

Knocked out were TotalEnergies (TTEF.PA), Motiva Enterprises (MOTIV.UL) and Marathon Petroleum (MPC.N) facilities outside Houston. Cold weather also disrupted Exxon Mobil (XOM.N), LyondellBasell (LYB.N) and Valero Energy (VLO.N) plants in Texas that produce gasoline, diesel and jet fuel.

Sempra Infrastructure’s Cameron LNG plant in Louisiana said weather disrupted its production of liquefied natural gas without providing details. Crews at the 12 million tonne-per-year facility were trying to restore output, it said.

Freeze-ins – in which ice crystals halt oil and gas production – this week trimmed production in North Dakota’s oilfields by 300,000 to 350,000 barrels per day, or a third of normal. In Texas’s Permian oilfield, the freeze led to more gas being withdrawn than was injected, said El Paso Natural Gas operator Kinder Morgan Inc. (KMI.N).

U.S. benchmark oil prices on Friday jumped 2.4% to $79.56, and next-day gas in west Texas jumped 22% to around $9 per million British thermal units , the highest since the state’s 2021 deep freeze.

Power prices on Texas’s grid also spiked to $3,700 per megawatt hour, prompting generators to add more power to the grid before prices fell back as thermal and solar supplies came online.

New England’s bulk power supplier said it expected to have enough to supply demand, but elsewhere strong winds led to outages largely in the Southeast and Midwest; North Carolina counted more than 187,000 without power.

“Crews are restoring power but high winds are making repairs challenging at most of the 4,600 outage locations,” Duke Energy spokesman Jeff Brooks wrote on Twitter.

Heating oil and natural gas futures rose sharply in response to the cold. U.S. heating oil futures gained 4.3% while natural gas futures rose 2.5%.

In New England, gas for Friday at the Algonquin hub soared 361% to a near 11-month high of $30 mmBtu.

About half of the power generated in New England comes from gas-fired plants, but on the coldest days, power generators shift to burn more oil. According to grid operator New England ISO, power companies’ generation mix was at 17% from oil-fired plants as of midday Friday.

Gas output dropped about 6.5 billion cubic feet per day (bcfd) over the past four days to a preliminary nine-month low of 92.4 bcfd on Friday as wells froze in Texas, Oklahoma, North Dakota, Pennsylvania and elsewhere.

That is the biggest drop in output since the February 2021 freeze knocked out power for millions in Texas.

One billion cubic feet is enough gas to supply about 5 million U.S. homes for a day.

Reporting by Erwin Seba and Scott DiSavino; additional reporting by Arathy Somasekhar and Laila Kearney; editing by Jonathan Oatis, Kirsten Donovan, Aurora Ellis and Leslie Adler

Our Standards: The Thomson Reuters Trust Principles.

Scott Disavino

Thomson Reuters

Covers the North American power and natural gas markets.

Read original article here

World

Saudi Arabia signs Huawei deal, deepening China ties on Xi visit

Leave a comment

  • Xi gets lavish welcome in Riyadh, a contrast with Biden trip
  • Chinese leader heralds ‘new era’ in ties with Arab world
  • U.S. wary of China’s growing influence

RIYADH, Dec 8 (Reuters) – Saudi Arabia and China showcased deepening ties with a series of strategic deals on Thursday during a visit by President Xi Jinping, including one with tech giant Huawei, whose growing foray into the Gulf region has raised U.S. security concerns.

King Salman signed a “comprehensive strategic partnership agreement” with Xi, who received a lavish welcome in a country forging new global partnerships beyond the West.

Xi’s car was escorted to the king’s palace by members of the Saudi Royal Guard riding Arabian horses and carrying Chinese and Saudi flags, and he later attended a welcome banquet.

The Chinese leader held talks with Crown Prince Mohammed bin Salman, de facto ruler of the oil giant, who greeted him with a warm smile. Xi heralded “a new era” in Arab ties.

The display stood in stark contrast to the low-key welcome extended in July to U.S. President Joe Biden, with whom ties have been strained by Saudi energy policy and the 2018 murder of Jamal Khashoggi that had overshadowed the awkward visit.

The United States, warily watching China’s growing sway and with its ties to Riyadh at a nadir, said on Wednesday Xi’s trip was an example of Chinese attempts to exert influence around the world and would not change U.S. policy towards the Middle East.

A memorandum with China’s Huawei Technologies [RIC:RIC:HWT.UL], on cloud computing and building high-tech complexes in Saudi cities, was agreed despite U.S. unease with Gulf allies over a possible security risk in using the Chinese firm’s technology. Huawei has participated in building 5G networks in most Gulf states despite the U.S. concerns.

Prince Mohammed, with whom Biden bumped fists instead of shaking hands in July, has made a comeback on the world stage following the Khashoggi killing and has been defiant in the face of U.S. ire over oil supplies and pressure from Washington to help isolate Russia.

In further burnishing of his international credentials, Saudi Arabia and the United Arab Emirates said on Thursday that the prince and the UAE president jointly led mediation efforts that secured the release of U.S. basketball star Brittney Griner in a prisoner swap with Russia.

[1/10] Saudi King Salman bin Abdulaziz and Chinese President Xi Jinping sign documents during a meeting in Riyadh, Saudi Arabia December 8, 2022. Bandar Algaloud/Courtesy of Saudi Royal Court/Handout via REUTERS

In an op-ed published in Saudi media, Xi said he was on a “pioneering trip” to “open a new era of China’s relations with the Arab world, the Arab countries of the Gulf, and Saudi Arabia”.

China and Arab countries would “continue to hold high the banner of non-interference in internal affairs”, Xi added.

That sentiment was echoed by the crown prince, who said his country opposed any “interference in China’s internal affairs in the name of human rights”, Chinese state broadcaster CCTV said.

Xi, due to meet other Gulf oil producers and attend a wider gathering of Arab leaders on Friday, said China would work to make those summits “milestone events in the history of China-Arab relations”, and that Beijing sees Riyadh as “an important force in the multipolar world”.

Saudi Arabia and other Gulf states like the United Arab Emirates have said that they would not choose sides between global powers and were diversifying partners to serve national economic and security interests.

“TRUSTED PARTNER”

China, the world’s biggest energy consumer, is a major trade partner of Gulf states and bilateral ties have expanded as the region pushes economic diversification, raising U.S. hackles about Chinese involvement in sensitive Gulf infrastructure.

The Saudi energy minister on Wednesday said Riyadh would stay a “trusted and reliable” energy partner for Beijing and the two would boost cooperation in energy supply chains by setting up a regional centre in the kingdom for Chinese factories.

Chinese and Saudi firms also signed 34 deals for investment in green energy, information technology, cloud services, transport, construction and other sectors, state news agency SPA reported. It gave no figures, but had earlier said the two countries would seal initial agreements worth $30 billion.

Tang Tianbo, Middle East specialist at the China Institutes of Contemporary International Relations (CICIR) – a Chinese government-affiliated think tank – said the visit would result in further expansion of energy cooperation.

Reporting by Aziz El Yaakoubi in Riyadh and Eduardo Baptista in Beijing; Writing by Tom Perry and Dominic Evans; Editing by Ghaida Ghantous and Nick Macfie, William Maclean

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

Norway raises military alert in response to Ukraine war

Leave a comment

  • Hiked preparedness seen lasting a year, could be longer
  • Norway is now Europe’s largest gas supplier
  • Shares a border with Russia in the Arctic

OSLO, Oct 31 (Reuters) – Norway will put its military on a raised level of alert from Tuesday, moving more personnel on to operational duties and enhancing the role of a rapid mobilisation force in response to the war in Ukraine, the government said on Monday.

Norway will also seek to bring its new fleet of U.S.-made P-8 Poseidon submarine-hunting maritime patrol aircraft into regular operation at a faster pace than originally planned, the chief of defence, General Eirik Kristoffersen, said.

The scale of alert on which the military operates is classified, however, and the government declined to give details of the level.

There were no concrete threats against Norway now triggering the decision, Kristoffersen told Reuters, but rather the sum of “the uncertainties” was leading authorities to raise the country’s military preparedness.

“We have seen an escalation (in the war) in Ukraine, we (Norway) are training Ukrainian forces, the Ukraine war has changed with the Russian mobilisation,” he said an interview.

“And at the same time, we have had a gas explosion in the Baltic Sea and drone activity at North Sea platforms.”

The raised level is expected to last a year, “possibly more”, Kristoffersen added.

OFFSHORE PLATFORMS

Norway first deployed its military to guard offshore platforms and onshore facilities after leaks on the Nord Stream pipelines on Sept. 26 in Swedish and Danish waters and has received support from British, Dutch, French and German armed forces.

The country’s security police last week arrested a suspected Russian spy and is also involved in protecting gas exports, vital to Europe’s energy supplies this coming winter.

NATO member Norway shares a nearly 200 km (125 mile) land border with Russia in the Arctic, as well as a vast maritime border.

The Nordic nation of 5.4 million people is also now the biggest exporter of natural gas to the European Union, accounting for around a quarter of all EU imports after a drop in Russian flows.

“The continuation of the war in Ukraine, Russia’s attempts at weakening (international) support for Ukraine mean that all countries in Europe must consider that they are exposed to hybrid threats. Including Norway.” Prime Minister Jonas Garh Stoere told Reuters.

The armed forces will spend less time training and more time on operational duties. The Home Guard, a rapid mobilisation force, will play a more active role.

The air force had called off training in the United States with its F35 fighter jets, preferring to keep them in Norway, said Kristoffersen.

Reporting by Gwladys Fouche; Writing by Terje Solsvik; Editing by John Stonestreet, Alison Williams and Alex Richardson

Our Standards: The Thomson Reuters Trust Principles.

Gwladys Fouche

Thomson Reuters

Oversees news coverage from Norway for Reuters and loves flying to Svalbard in the Arctic, oil platforms in the North Sea, and guessing who is going to win the Nobel Peace Prize. Born in France and with Reuters since 2010, she has worked for The Guardian, Agence France-Presse and Al Jazeera English, among others, and speaks four languages.

Read original article here

World

Russia says UK navy blew up Nord Stream, London denies involvement

Leave a comment

  • Russia says UK navy personnel blew up pipelines
  • Russia says UK navy personnel helped attack Crimea
  • Russia does not give evidence for claim
  • Britain denies Russian claims

LONDON, Oct 29 (Reuters) – Russia’s defence ministry said on Saturday that British navy personnel blew up the Nord Stream gas pipelines last month, a claim that London said was false and designed to distract from Russian military failures in Ukraine.

Russia did not give evidence for its claim that a leading NATO member had sabotaged critical Russian infrastructure amid the worst crisis in relations between the West and Russia since the depths of the Cold War.

The Russian ministry said that “British specialists” from the same unit directed Ukrainian drone attacks on ships of Russian Black Sea fleet in Crimea earlier on Saturday that it said were largely repelled by Russian forces, with minor damage to a Russian minesweeper.

“According to available information, representatives of this unit of the British Navy took part in the planning, provision and implementation of a terrorist attack in the Baltic Sea on September 26 this year – blowing up the Nord Stream 1 and Nord Stream 2 gas pipelines,” the ministry said.

Britain denied the claim.

“To detract from their disastrous handling of the illegal invasion of Ukraine, the Russian Ministry of Defence is resorting to peddling false claims of an epic scale,” it said.

“This invented story, says more about arguments going on inside the Russian government than it does about the West.”

Russia has previously blamed the West for the explosions that ruptured the Russian-built Nord Stream 1 and Nord Stream 2 pipelines on the bed of the Baltic Sea.

But it had not previously given specific details of who it thinks was responsible for the damage to the pipelines, previously the largest routes for Russian gas supplies to Europe.

A sharp drop in pressure on both pipelines was registered on Sept. 26 and seismologists detected explosions, triggering a wave of speculation about sabotage to one of Russia’s most important energy corridors.

Reuters has not been able to immediately verify any of the conflicting claims about who was to blame for the damage.

PIPELINE MYSTERY

Sweden and Denmark have both concluded that four leaks on Nord Stream 1 and 2 were caused by explosions, but have not said who might be responsible. NATO Secretary-General Jens Stoltenberg has called the damage an act of sabotage.

Sweden has ordered additional investigations to be carried out into the damage done to the pipelines, the prosecutor in charge of the case said in a statement on Friday.

The Kremlin has repeatedly said allegations of Russian responsibility for the damage were “stupid” and Russian officials have said Washington had a motive as it wants to sell more liquefied natural gas (LNG) to Europe.

The United States has denied involvement.

The Nord Stream 1 and Nord Stream 2 pipelines have a joint annual capacity of 110 billion cubic metres – more than half of Russia’s normal gas exports volumes.

Sections of the 1,224-km (760-mile) long pipelines, which run from Russia to Germany, lie at a depth of around 80-110 metres.

Russia said meanwhile that Ukrainian forces attacked ships from the Black Sea Fleet in Sevastopol, the biggest city in Russian-annexed Crimea, in the early hours of Saturday.

“Nine unmanned aerial vehicles and seven autonomous marine drones were involved in the attack,” the defence ministry said.

“The preparation of this terrorist act and the training of servicemen of the Ukrainian 73rd Special Center for Naval Operations were carried out under the guidance of British specialists located in the town of Ochakiv.”

All the air drones were destroyed though minor damage was done to the minesweeper Ivan Golubets, the ministry said. Sevastopol is the headquarters of Russia’s Black Sea Fleet.

Reporting by Reuters
Editing by Guy Faulconbridge and Frances Kerry

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

Business

Exxon’s record-smashing Q3 profit nearly matches Apple’s

Leave a comment

  • Oil firm smashes Wall Street forecasts with $19.7 billion profit
  • Exxon’s fossil-fuel bets eclipse rivals Shell, TotalEnergies
  • Company projects flat oil output this year on Russia losses

HOUSTON, Oct 28 (Reuters) – Exxon Mobil Corp (XOM.N) on Friday smashed expectations as soaring energy prices fueled a record-breaking quarterly profit, nearly matching that of tech giant Apple.

Its $19.66 billion third-quarter net profit far exceeded recently raised Wall Street forecasts as skyrocketing natural gas and high oil prices put its earnings within reach of Apple’s (AAPL.O) $20.7 billion net for the same period.

As recently as 2013, Exxon ranked as the largest publicly traded U.S. company by market value – a position now held by Apple. Exxon shares rose 3% to $110.70, a record high that gave it a market value of $461 billion.

Oil company profits have soared this year as rising demand and an undersupplied energy market collided with Western sanctions against Russia over its invasion of Ukraine. U.S. exports of gas and oil to Europe have jumped and promise to set all-time profit records for the industry.

The top U.S. oil producer reported a per-share profit of $4.68, exceeding Wall Street’s $3.89 consensus view, on a huge jump in natural gas earnings, continued high oil prices and strong fuel sales.

“Where others pulled back in the face of uncertainty and a historic slowdown, retreating and retrenching, this company moved forward, continuing to invest,” Chief Executive Darren Woods told investors. Its quarterly profits “reflect that deep commitment” as well as higher prices, he added.

Exxon led record gains among oil majors in the second quarter and has leapfrogged Shell Plc (SHEL.L) and TotalEnergies SE (TTEF.PA) with earnings almost twice as big from continued bets on fossil fuels as competitors shifted investment to renewables.

Reuters Graphics Reuters Graphics

Exxon banked $43 billion in the first nine months of this year, 19% more than in the same period of 2008, when oil prices traded at a record level of $140 per barrel.

Earnings from pumping oil and gas tripled last quarter while profit from selling motor fuels jumped tenfold compared with year-ago levels. Natural gas sales to Europe and soaring demand for diesel fuel led the company’s better-than-expected results.

“The refining businesses – both in the U.S. and international – was the star performer,” said Peter McNally, an analyst at Third Bridge.

Those rising fuel profits have renewed calls by U.S. President Joe Biden for companies to invest the windfall from this year’s energy price run-up in production rather than buy back their own shares.

Exxon will maintain its $30 billion share buyback through 2023 while increasing dividends, Chief Financial Officer Kathryn Mikells told Reuters. On Friday, it declared a fourth-quarter per-share dividend of 91 cents, up 3 cents, and will pay $15 billion to shareholders this year.

Exxon said its U.S. oil and gas production from the Permian Basin was near 560,000 barrels of oil and gas per day (boepd), a record. Production for the year will increase about 20% over 2021, said CEO Woods.

“We’re optimizing and adjusting our development plans,” he told analysts, with the full-year production gain below the 25% increase Exxon had forecast in February.

Results also were helped by an almost 100,000-boepd increase over the previous quarter in Guyana, where Exxon leads a consortium responsible for all output in the South American nation.

But its withdrawal from Russia reduced its overall production forecast for the year by about 100,000 barrels per day. Exxon said its Russian assets were expropriated.

“We are going to end up at about 3.7 million barrels a day for the full year,” Mikells said, down from a 3.8 million bpd goal set in February.

Reporting by Sabrina Valle; Editing by Ana Nicolaci da Costa, Jonathan Oatis and Marguerita Choy

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

Business

Shell reports drop in profit to $9.45 billion, hikes dividend

Leave a comment

  • Shell to boost dividend by 15%
  • Announces plans to buy further $4 billion in shares
  • Profit hit by weak LNG trading and refining

LONDON, Oct 27 (Reuters) – Shell (SHEL.L) on Thursday posted a third-quarter profit of $9.45 billion, slightly below the second quarter’s record high, due to weaker refining and gas trading, and said it will sharply boost its dividend by the end of 2022 when its CEO departs.

The British oil and gas giant also extended its share repurchasing programme, announcing plans to buy $4 billion of stock over the next three months after completing $6 billion in purchases in the second quarter.

Shell said it intends to increase its dividend by 15% in the fourth quarter, when Chief Executive Officer Ben van Beurden will step down after nine years at the helm. The dividend will be paid in March 2023.

It will be the fifth time that Shell will have raised its dividend since slashing it by more than 60% in the wake of the 2020 COVID-19 pandemic.

Shell shares were up nearly 6% by 1430 GMT, compared with a 3.5% gain for the broader European energy sector (.SXEP).

Van Beurden will be succeeded by Wael Sawan, the current head of Shell’s natural gas and low-carbon division.

With a profit of $30.5 billion so far this year, Shell is well on track to exceed its record annual profit of $31 billion in 2008.

The strong earnings were likely to intensify calls in Britain and the European Union to impose further windfall taxes on energy companies as governments struggle with soaring gas and power bills.

Van Beurden said the energy industry “should be prepared and accept” that it will face higher taxes to help struggling parts of society.

Shell’s shares have gained more than 40% so far this year, lifted by soaring oil and gas prices in the wake of Russia’s invasion of Ukraine in February and amid tightening global oil and gas supplies.

French rival TotalEnergies posted a record profit in the third quarter.

[1/2] A view shows a board with the logo of Shell at the company’s fuel station in Saint Petersburg, Russia May 6, 2022. REUTERS/Anton Vaganov/File Photo

Reuters Graphics Reuters Graphics

LNG WOES

Shell’s quarterly adjusted earnings of $9.45 billion, which slightly exceeded forecasts, were hit by a sharp 38% quarterly drop in the gas and renewables division, the company’s largest.

Earnings for the second quarter were a record $11.5 billion.

The world’s largest trader of liquefied natural gas (LNG) produced 7.2 million tonnes of LNG in the period, 5% less than in the previous quarter, mainly due to ongoing strikes at its Australian Prelude facility.

Its gas trading business was hit this quarter by “supply constraints, coupled with substantial differences between paper and physical realisations in a volatile and dislocated market.”

Earnings from the refining, chemicals and oil trading division also dropped sharply by 62% in the quarter due to weaker refining margins.

Shell said it would stick to its plans to spend $23 billion to $27 billion this year.

Shell’s cash flow in the third quarter dropped sharply to $12.5 billion from $18.6 billion in the second quarter due to a large working capital outflow of $4.2 billion as a result of changes in the value of European gas inventories.

Shell’s net debt rose by around $2 billion to $46.4 billion due to lower cash flow from operations and to pay for a recent acquisition. Its debt-to-capital ratio, known as gearing, also rose above 20%.

Reuters Graphics

Reporting by Ron Bousso and Shadia Nasralla; editing by Jason Neely, Simon Cameron-Moore and Paul Simao

Our Standards: The Thomson Reuters Trust Principles.

Shadia Nasralla

Thomson Reuters

Writes about the intersection of corporate oil and climate policy. Has reported on politics, economics, migration, nuclear diplomacy and business from Cairo, Vienna and elsewhere.

Read original article here

Business

World is in its ‘first truly global energy crisis’ – IEA’s Birol

Leave a comment

SINGAPORE, Oct 25 (Reuters) – Tightening markets for liquefied natural gas (LNG) worldwide and major oil producers cutting supply have put the world in the middle of “the first truly global energy crisis”, the head of the International Energy Agency (IEA) said on Tuesday.

Rising imports of LNG to Europe amid the Ukraine crisis and a potential rebound in Chinese appetite for the fuel will tighten the market as only 20 billion cubic meters of new LNG capacity will come to market next year, IEA Executive Director Fatih Birol said during the Singapore International Energy Week.

At the same time the recent decision by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to cut 2 million barrels per day (bpd) of output is a “risky” decision as the IEA sees global oil demand growth of close to 2 million bpd this year, Birol said.

Register now for FREE unlimited access to Reuters.com

“(It is) especially risky as several economies around the world are on the brink of a recession, if that we are talking about the global recession…I found this decision really unfortunate,” he said.

Soaring global prices across a number of energy sources, including oil, natural gas and coal, are hammering consumers at the same time they are already dealing with rising food and services inflation. The high prices and possibility of rationing are potentially hazardous to European consumers as they prepare to enter the Northern Hemisphere winter.

Europe may make it through this winter, though somewhat battered, if the weather remains mild, Birol said.

“Unless we will have an extremely cold and long winter, unless there will be any surprises in terms of what we have seen, for example Nordstream pipeline explosion, Europe should go through this winter with some economic and social bruises,” he added.

For oil, consumption is expected to grow by 1.7 million bpd in 2023 so the world will still need Russian oil to meet demand, Birol said.

G7 nations have proposed a mechanism that would allow emerging nations to buy Russian oil but at lower prices to cap Moscow’s revenues in the wake of the Ukraine war.

Birol said the scheme still has many details to iron out and will require the buy-in of major oil importing nations.

A U.S. Treasury official told Reuters last week that it is not unreasonable to believe that up to 80% to 90% of Russian oil will continue to flow outside the price cap mechanism if Moscow seeks to flout it.

“I think this is good because the world still needs Russian oil to flow into the market for now. An 80%-90% is good and encouraging level in order to meet the demand,” Birol said.

While there is still a huge volume of strategic oil reserves that can be tapped during a supply disruption, another release is not currently on the agenda, he added.

ENERGY SECURITY DRIVES RENEWABLES GROWTH

The energy crisis could be a turning point for accelerating clean sources and for forming a sustainable and secured energy system, Birol said.

“Energy security is the number one driver (of the energy transition),” said Birol, as countries see energy technologies and renewables as a solution.

The IEA has revised up the forecast of renewable power capacity growth in 2022 to a 20% year-on-year increase from 8% previously, with close to 400 gigawatts of renewable capacity being added this year.

Many countries in Europe and elsewhere are accelerating the installation of renewable capacity by cutting the permitting and licensing processes to replace the Russian gas, Birol said.

Register now for FREE unlimited access to Reuters.com

Reporting by Florence Tan, Muyu Xu and Emily Chow; Editing by Jacqueline Wong and Christian Schmollinger

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

Putin courts Erdogan with plan to pump more Russian gas via Turkey

Leave a comment

  • Putin presents Turkish leader with new “gas hub” plan
  • Moscow seeks new corridor after damage to Baltic pipelines
  • Erdogan seen as key diplomatic player in Russia-Ukraine war

ASTANA, Oct 13 (Reuters) – Russian President Vladimir Putin proposed to his Turkish counterpart Tayyip Erdogan on Thursday that Moscow could export more gas via Turkey and turn it into a new supply “hub”, bidding to preserve Russia’s energy leverage over Europe.

At a meeting in Kazakhstan, Putin said Turkey offered the most reliable route to deliver gas to the European Union, and the proposed platform would allow prices to be set without politics.

Russia is looking to redirect supplies away from the Nord Stream Baltic gas pipelines, damaged in explosions last month that are still under investigation. Russia blamed the West, without providing evidence, and rejected what it called “stupid” assertions that it had sabotaged the pipelines itself.

Register now for FREE unlimited access to Reuters.com

Putin told Erdogan the hub would be “a platform not only for supplies, but also for determining the price, because this is a very important issue”.

“Today, these prices are sky-high,” he said. “We could easily regulate [them] at a normal market level, without any political overtones.”

Erdogan did not respond in the televised portion of their meeting, but Kremlin spokesman Dmitry Peskov was quoted by the Russian news agency RIA as saying both men had ordered a rapid and detailed examination of the idea.

Russia supplied about 40% of Europe’s gas before its Feb. 24 invasion of Ukraine but had cut flows sharply even before the explosions, blaming technical problems that it said were the result of Western sanctions.

European governments rejected that explanation, accusing Moscow of using energy as a geopolitical weapon.

Russia’s President Vladimir Putin and Turkey’s President Tayyip Erdogan meet on the sidelines of the 6th summit of the Conference on Interaction and Confidence-building Measures in Asia (CICA), in Astana, Kazakhstan October 13, 2022. Sputnik/Vyacheslav Prokofyev/Pool via REUTERS

TURKISH MEDIATION

Relations with NATO member Turkey are vital to Russia at a time when the West has hit it with waves of economic sanctions, which Ankara has refrained from joining. Turkey has, however, rejected Russia’s move to annex four Ukrainian regions as a “grave violation” of international law.

Erdogan has sought to mediate between Moscow and Kyiv, and achieved a rare breakthrough in July when, together with the United Nations, he brokered an agreement allowing for the resumption of commercial Ukrainian grain exports from Black Sea ports that Russia had blockaded.

Russia has complained, however, that its own grain and fertiliser exports, while not directly targeted by Western sanctions, continue to be hampered by problems with access to foreign ports and obtaining insurance.

Erdogan told Putin: “We are determined to strengthen and continue the grain exports … and the transfer of Russian grain and fertiliser to less developed countries via Turkey.”

Russian officials had said before the meeting that they were open to hearing proposals from Turkey about hosting peace talks involving Russia and the West.

However, Peskov was quoted by RIA as saying “the topic of a Russian-Ukrainian settlement was not discussed” by the leaders.

Russian Foreign Minister Sergei Lavrov this week signalled increasing receptiveness to talks after Moscow suffered a series of military defeats. Washington dismissed his comments as “posturing”.

Ukrainian President Volodymyr Zelenskiy has ruled out talking to Putin after he proclaimed the annexation of the four Ukrainian regions and after Russia rained missiles on Ukrainian cities this week in the wake of an attack on a vital bridge between Russia and Crimea, the peninsula it seized in 2014.

Register now for FREE unlimited access to Reuters.com

Reporting by Reuters; writing by Mark Trevelyan, Editing by Kevin Liffey

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

Druzhba pipeline leak reduces Russian oil flows to Germany

Leave a comment

WARSAW, Oct 12 (Reuters) – Germany said on Wednesday it was receiving less oil but still had adequate supplies, after Poland found a leak in the Druzhba pipeline that delivers crude from Russia to Europe that Warsaw said was probably caused by an accident rather than sabotage.

The discovery of the leak in the main route carrying oil to Germany, which operator PERN said it found on Tuesday evening, comes as Europe is on high alert over its energy security as it faces a severe crisis in the aftermath of Moscow’s invasion of Ukraine which has cut supplies of gas.

“Security of supply in Germany is currently guaranteed,” an economy ministry spokesperson said in an emailed statement. “The refineries in Schwedt and Leuna continue to receive crude oil via the Druzhba pipeline.”

Register now for FREE unlimited access to Reuters.com

The Schwedt refinery, which supplies 90% of Berlin’s fuel, said in an emailed statement that deliveries were taking place at reduced capacity.

Germany said it was hoping for more information soon from Poland about the cause of the leak and how it can be repaired.

Europe has been on high alert over the security of its energy infrastructure since major leaks were found last month in the Nord Stream 1 and 2 gas pipelines running from Russia to Europe under the Baltic Sea. Both the West and Russia have blamed sabotage.

However, Poland’s top official in charge of energy infrastructure, Mateusz Berger, told Reuters by telephone that the leak in the Druzhba pipeline was most likely caused by “accidental damage”.

“We are living in turbulent times, different connotations are possible, but at this stage we have no grounds at all to believe that,” he said, when asked about the possibility of sabotage.

Berger said the leak was located 70 km (44 miles) west from Plock, where Poland’s biggest refinery owned by PKN Orlen is located. As a result, part of the shipping capacity towards Germany was not available, he said, adding that repairs would likely “not take long”.

PERN said supplies to Germany were reduced but continuing.

Reuters Graphics

GERMAN, POLAND REFINERY SUPPLIES

A model of a pipe line is seen at the main entrance to the Gomel Transneft oil pumping station, which moves crude through the Northern Druzhba pipeline westwards to Poland and Europe, near Mozyr, Belarus, in this file picture taken January 4, 2020. REUTERS/Vasily Fedosenko

The Druzhba oil pipeline, whose name means “friendship” in Russian, is one of the world’s largest, supplying Russian oil to much of central Europe including Germany, Poland, Belarus, Hungary, Slovakia, the Czech Republic and Austria.

Russia’s Transneft state-owned pipeline monopoly said that oil continues to be pumped towards Poland.

Poland’s PKN Orlen (PKN.WA) said that oil supplies to its Plock refinery were not interrupted while Czech pipeline operator MERO said it had not seen any change in flows to the Czech Republic.

“The main action (we are taking) is to pump out the liquid and locate the leak and stop it,” fire brigade spokesman Karol Kierzkowski told state broadcaster TVP Info.

“When the pressure decreases, the leak will stop and allow us to reach the leak,” he said, adding that it was too early to establish the cause and there was no danger to the public.

Firefighters in the mid-northern Kujawsko-Pomorskie region of Poland said they had pumped about 400 cubic metres of oil and water from the site of the leak which was in the middle of a corn field.

The second line of the pipeline, and other elements of PERN’s infrastructure, were working as normal, PERN said.

“At this point, all PERN services (technical, operational, in-house fire brigade and environmental protection) are taking action in accordance with the algorithms provided for this type of situation,” the operator said.

The total capacity of the western section of the pipeline that ships oil from central Poland to Germany is 27 million tonnes of crude oil per year.

Germany’s Schwedt refinery is particularly dependent on Druzhba.

The German government aims to eliminate imports of oil from Russia by the end of the year under European Union sanctions. But in the first seven months of the year, Russia was still its top supplier, accounting for just over 30% of oil imports.

As Germany looks for alternative supplies for Schwedt, Druzhba could be instrumental in supplying oil via the Polish port in Gdansk.

The German government has also been in talks to secure oil from Kazakhstan to supply Schwedt, but that oil would have to flow to Germany via the Druzhba pipeline too.

Register now for FREE unlimited access to Reuters.com

Reporting by Reuters bureaus writing by Alan Charlish and Marek Strzelecki; Editing by Jan Harvey and Elaine Hardcastle

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

NATO warns Moscow against attacking allies’ critical infrastructure

Leave a comment

  • NATO defence ministers meet in Brussels on Wed-Thurs
  • NATO to hold annual nuclear preparedness drill next week
  • NATO chief urges Belarus president to stop “complicity”

BRUSSELS, Oct 11 (Reuters) – NATO told Moscow on Tuesday it would meet attacks on allies’ critical infrastructure with a “united and determined response” and was monitoring Russia’s nuclear forces closely as the country was “losing on the battlefield” in Ukraine.

NATO Secretary-General Jens Stoltenberg said ahead of a two-day meeting of the Western alliance’s defence ministers in Brussels that it had not seen any changes in Russia’s nuclear posture, but was “vigilant”.

Stoltenberg described Russia’s missile strikes on civilians in Ukraine on Monday as a sign of weakness.

Register now for FREE unlimited access to Reuters.com

“Russia is actually losing on the battlefield,” he told a news conference, saying it was responding with “indiscriminate attacks” to Ukrainian advances.

That view was echoed by U.S. ambassador to NATO Julianne Smith.

“President Putin is failing to meet his strategic objectives on the ground and this has been a reoccurring theme for him personally since this war started,” she told an online briefing.

The alliance will proceed with its annual nuclear preparedness exercise “Steadfast Noon” next week, in which NATO air forces practise the use of U.S. nuclear bombs based in Europe with training flights, without live weapons.

Cancelling the drills because of the war in Ukraine would send a “very wrong signal”, Stoltenberg said. Russia has made veiled threats of using nuclear weapons against Ukraine, which it invaded on Feb. 24 in what it calls a “special military operation” to demilitarise its neighbour.

“It’s an exercise to ensure that our nuclear deterrent remains safe, secure and effective,” he said.

NATO’s military strength, he said, was the best way to prevent any escalation of tensions.

Stoltenberg also pledged to boost the protection of critical infrastructure in response to the attack on the Nord Stream gas pipelines, saying NATO had already doubled its presence in the Baltic and the North Seas to over 30 ships supported by aircraft and undersea activities.

“A deliberate attack against allies’ critical infrastructure will be met with a united and determined response,” Stoltenberg said.

It remains unclear who was behind the attack on the Nord Stream pipelines.

Stoltenberg also urged Belarusian President Alexander Lukashenko to stop his country’s “complicity” in an illegal conflict.

Lukashenko said on Monday he had ordered troops to deploy with Russian forces near Ukraine in response to what he said was a clear threat to Belarus from Kyiv and its backers in the West. Military experts see this as a potential attempt to stretch Ukrainian forces.

Register now for FREE unlimited access to Reuters.com

Additional reporting by John Chalmers and Jan Strupczewski
Editing by Gareth Jones and Nick Macfie

Our Standards: The Thomson Reuters Trust Principles.

Read original article here