Energy

  • How Will Iran's Oil Exports Rebound?

    Global oil prices hit their lowest point since 2003 after the United States, the European Union, and the United Nations on January 16 lifted sanctions on Iran in response to the International Atomic Energy Agency’s conclusion that the Islamic Republic was in compliance with the terms of a nuclear deal. Brent Crude fell to $27.67 per barrel on January 18. US crude oil also dropped 29 cents to $28.64 per barrel.

    The current glut has created concern about Iran’s full return to the global energy market. Since 2012, US and EU sanctions on Iranian oil exports cost the Islamic Republic a drop of more than 1 million barrels per day. Iran’s Oil Minister, Bijan Zangeneh, had vowed to increase production up to a million barrels per day (b/d) within six months once sanctions were lifted. Zangeneh said he is ready to add 500,000 b/d of oil the day after sanctions are lifted, also known as...

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  • Privatization of Saudi Aramco: A Path to Good Governance?

    Saudi Arabia’s Deputy Crown Prince, Muhammad bin Salman, gave a fascinating interview to the Economist on January 4. Among the many subjects he covered, one in particular appealed to energy wonks—the privatization of Saudi Aramco.

    This topic has been discussed within the kingdom for years, but never got anywhere, probably because a privatized Saudi Aramco would have to publish audited statements. Saudi Aramco, a modern and brilliantly managed company, would likely have no problem in being as transparent as, say, ExxonMobil. However, a transparent Saudi Aramco would allow the public to find out how much money gets diverted to the royal family before income from oil sales enters the accounts of the Ministry of Finance. This could be most embarrassing for the royal family, which would have to explain to Saudis why it is entitled to many billions of dollars at a time when subsidies are being removed and all...

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  • Nord Stream 2: Downgrading Europe’s Security of Supply Where it Matters

    Nord Stream 2 is the latest Russian incarnation intended to bypass Ukraine and bring Russian gas directly to Europe’s borders. It would double the existing Nord Stream capacity to 110 billion cubic meters/year with two additional strings between Russia and Germany under the Baltic Sea. In spite of a recently signed shareholders agreement between Russian gas giant Gazprom and five European firms, underpinned by unflinching German support, Nord Stream 2 remains subject to considerable legal and regulatory oversight by the European Commission even before it can be commissioned.

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  • In Mexico, Transition to Gas Reduces Electricity Tariffs

    Mexico’s consumption of fuel oil has declined by 60 percent since 2012, and is on track to achieve a reduction of 90 percent by 2018, according to Guillermo Turrent, Director of Modernization at Mexico’s Federal Commission of Electricity (CFE). Turrent spoke on a conference call convened by the Adrienne Arsht Latin America Center and David L. Goldwyn, Chairman of the Atlantic Council’s Energy Advisory Group, on Nov. 5.

    The virtual elimination of fuel oil from Mexico’s fuel mix is arguably the most impressive accomplishment to date of the country’s nascent energy reform, which began with the constitutional reforms of 2013. The gas transition has enabled a reduction in industrial electricity prices, with CFE reporting December 2015 industrial and commercial tariffs have decreased 30-42 percent and 13-27 percent year on year, respectively. Basic consumer tariffs are...

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  • Saudi Arabia Prepares for OPEC Clash as Succession Questions Linger

    Saudi Arabia will face pressure in Vienna this week from fellow members of the Organization of the Petroleum Exporting Countries (OPEC) to rethink the group’s strategy of sustained high oil output that is causing economic pain to most oil producers.

    The OPEC meeting on Dec. 4 comes at a time when Gulf watchers are questioning both how long Riyadh can endure the heavy financial strain on its coffers and the current Saudi leadership’s stability.

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  • Manning on Iran Nuclear Deal

    Anadolu Agency quotes Brent Scowcroft Center Resident Senior Fellow Robert A. Manning on congressional concerns about the Iranian nuclear deal and the deal's likely impact on oil markets:

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  • Mexico’s Inaugural Bid Round: What Happened and What’s Next?

    On July 15, 2015, Mexico announced the results of the first phase of “Round One,” or a series of auctions providing foreign companies access to oil and gas acreage after over seventy-five years of state control of upstream exploration and production. Only two of the fourteen shallow water blocks on offer were awarded—far below the government’s publicly stated expectation that at least five blocks would be awarded. But for those two blocks, the share of the project the winning bidder offered the Mexican state far exceeded the government-stipulated minimum share. So was the round a success or failure?

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  • Scientific American Highlights Atlantic Council Event on Renewable Energy

    Scientific American highlights an Atlantic Council event on a sustainable energy future:

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  • Completing Europe: The North-South Corridor

    Twenty-five years after the collapse of the Berlin Wall and the beginning of a long process of European reunification, Europe has arrived at a historic inflection point. The European Union faces multiple external threats, including a resurgent Russia, growing global economic competition, and geopolitical upheaval.

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  • Is the US Still Leading in Global Trade?

     

    In the last two decades, the Asia Pacific region has signed sixty-five free trade agreements. South America, Eurasia, and Europe combined have signed over one-hundred and fifty agreements. Over the same period, the US has signed twelve agreements.

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