Third fuel tank collapses as fire rages at Cuba oil terminal | Oil and Gas News

With assist from Mexico and Venezuela, Cuba has been battling monumental blaze at main oil terminal in Matanzas.

A 3rd crude tank caught fireplace and collapsed Monday at Cuba’s fundamental oil terminal in Matanzas, the regional governor has mentioned, as an oil spill unfold flames from a second tank that caught fireplace two days earlier within the island’s greatest oil business accident in many years.

Cuba had made progress combating off the raging flames in the course of the weekend after drawing on assist from Mexico and Venezuela, however late on Sunday the hearth started spreading from the second tank, which collapsed, mentioned Mario Sabines, governor of the Matanzas province, about 100km (60 miles) from Havana.

A fourth tank is threatened however has but to catch fireplace. Firefighters had sprayed water on the remaining tanks over the weekend to chill them and attempt to cease the hearth from spreading.

Matanzas is Cuba’s largest port for receiving crude oil and gasoline imports. Cuban heavy crude, in addition to gasoline oil and diesel saved in Matanzas, are primarily used to generate electrical energy on the island.

Sabines in contrast the state of affairs to an “Olympic torch” going from one tank to the following, turning every right into a “caldron” and now encompassing the realm masking three tanks and with flames and billowing black smoke making tackling the state of affairs “difficult”.

“The chance we had introduced occurred, and the blaze of the second tank compromised the third one,” mentioned Sabines.

Native officers warned residents to make use of face masks or keep indoors given the billowing smoke enveloping the area that may be seen from Havana.

Officers have warned that the cloud incorporates sulfur dioxide, nitrogen oxide, carbon monoxide and different toxic substances.

One firefighter has died and 16 individuals are lacking, all from Saturday’s explosion on the second storage tank. The blaze began after lightning struck one of many facility’s eight tanks on Friday night time.

Cuban state-run tv has coated the unfolding catastrophe reside since Saturday and President Miguel Diaz-Canel has been a relentless presence there, highlighting the financial and political significance of the state of affairs.

The closely US-sanctioned nation has been affected by blackouts, gasoline and different shortages that had already created a tense state of affairs with scattered native protests following final 12 months’s anti-government demonstrations in July.

A tanker carrying Russian crude to Matanzas, recognized by Refinitiv Eikon monitoring service, is unlikely to have the ability to discharge subsequent week even when docks should not affected by the hearth, due to potential injury to tanks, pipelines and valves, analysts mentioned.

At midday on Monday, authorities introduced the nation’s most essential energy plant, situated a few kilometre from the hearth, had been shut down attributable to low water stress within the space.

Fire is seen over fuel storage tanks that exploded near Cuba's supertanker port in Matanzas, Cuba
Residents have been instructed to put on masks or keep indoors because the smoke incorporates poisonous parts. A fourth tank is vulnerable to catching fireplace [Alexandre Meneghini/Reuters]

Mixed reactions as Nigeria’s state oil firm sheds public coat | Oil and Gas

Abuja, Nigeria – After greater than half a century in existence as a authorities monopoly, Nigeria’s oil firm, the Nigerian Nationwide Petroleum Firm (NNPC), is about to open up its capital to personal buyers.

The transfer, marked with a launch ceremony on Tuesday, comes after parliament handed a invoice final yr to unbundle the NNPC and open it up for personal sector funding.

“We’re reworking our petroleum business to strengthen its capability and market relevance for the current and future world vitality priorities,” President Muhammadu Buhari, who additionally doubles because the petroleum minister, stated on the ceremony.

For years, the oil agency has been plagued with bribery scandals and monetary transparency points, in addition to different query marks surrounding its twin position as a participant and regulator to different companies within the business.

Shift to ‘better transparency’

In June 2020, the NNPC printed audited statements for the primary time in its historical past, following strain from native civil society teams and the worldwide group. Since then, it has continued to place out monetary statements, suggesting a departure from years of opaqueness.

Joachim MacEbong, the lead analyst at Lagos-based Acorn and Sage Consulting informed Al Jazeera that these strikes present a shift to “better transparency” below Mele Kyari, the NNPC chief since July 2019. “Such issues assist to chip away at its established repute as an opaque piggy financial institution for successive governments,” MacEbong stated.

He and different analysts say the oil firm will in the end must topic itself to scrutiny by different stakeholders within the business, as an alternative of the established order – reporting solely to the president –  to ensure that that repute to be shed absolutely.

After greater than 10 years of debate in parliament, the petroleum business invoice was signed final August, paving the way in which for the NNPC’s commercialisation.

Till its arrival, the Nigerian oil and fuel business misplaced about $50bn price of investments, in accordance with Timipre Sylva, the minister of state for petroleum sources, on the launch ceremony.

Nigeria had solely gained “4% of the $70 billion funding inflows into Africa’s oil and fuel business … despite the fact that the nation is the continent’s greatest producer and the most important reserves,” added a 2021 KPMG report.

“We’re setting all these woes behind us, and a transparent path for the survival and progress of our petroleum business is now earlier than us,” Sylva stated on Tuesday. “With the PIA assuring worldwide and native oil firms of enough safety for his or her investments, the nation’s petroleum business is now not rudderless.”

Commercialising the state oil agency will permit the brand new entity to compete for oil and fuel belongings within the nation, Kyari stated final month at an business convention in Abuja, the nation’s capital.

However the transfer may additionally assist the NNPC shed its greatest weight but – that of gasoline subsidies.

Subsidy and money owed

Since 1977 when the contentious welfare coverage was launched, Nigeria has spent trillions of its forex, the naira, propping it up. As of final yr, it was spending a 3rd of oil revenues or 2 p.c of its gross home product (GDP) on gasoline subsidies.

However the NNPC is battling to rein this in at the same time as hovering diesel costs are crippling companies from telecoms to fuel stations and rising strain on the federal government for some reduction.

Final November, the World Financial institution estimated that Nigeria “may lose greater than N3 trillion in revenues in 2022 as a result of the proceeds from crude oil gross sales … can be used to cowl the rising price of gasoline subsidies that largely profit the wealthy”. “Sadly, that projection turned out to be optimistic,” stated Shubham Chaudhuri, World Financial institution Nation Director for Nigeria.

The brand new business regulation mandates Abuja to take away subsidy funds however that process might be prolonged by 18 months, following a request to parliament in January. The delay in implementation means Nigeria will spend 4 trillion naira ($9bn) in subsidy funds this yr, following approval by the Senate.

With Nigeria’s whole debt inventory rising to 41.6 trillon naira ($100.1bn) within the first quarter of 2022, Africa’s greatest financial system may face debt misery within the close to time period, in accordance with the Worldwide Financial Fund (IMF). This month, Abuja launched figures displaying that the price of servicing money owed surpassed its income within the first 4 months of 2022.

Opening the NNPC as much as outdoors funding will assist speed up the method of ending subsidy funds in Nigeria, analysts say. “The query shouldn’t be if it would go, however when and how briskly,” Mac-Ebong.

Combined reactions

The NNPC’s commercialisation has elicited blended reactions from business insiders and analysts.

In the long term, the oil firm going public will ideally scale back the federal government’s fiscal duties to it, thus liberating up funding for different tasks, Ekpen Omonbude, a former financial adviser on pure sources on the London-based Commonwealth Secretariat, stated by cellphone.

It’s anticipated to “carry operational effectivity and transparency to the Nigerian oil and fuel business,” Ese Osawmonyi, a senior analyst at SBM Intelligence, informed Al Jazeera.  “Now that dependence on authorities income is being eradicated … diversifying its income stream … is the essential goal of this new NNPC.”

The Nigerian oil agency stated final yr that it will take into account an preliminary public providing (IPO) in 2024. That might be a little bit too quickly, Osamwonyi warned, as a result of “profitability can’t be instant, nor can the margin be ascertained.”

Or it may even be a little bit too late as a result of opening up the NNPC is nice however its timing is unlucky resulting from quite a few missed alternatives to independently elevate capital and run extra successfully, Omonbude, who can be chair of the UK-based Bargate Advisory, stated.

“They are saying the perfect time to construct a tree was 20 years in the past, and the second finest time is now.” he informed Al Jazeera. “I’m not so certain that is the second finest time, although. Capital isn’t actually chasing fossil fuels because it did say a decade in the past, the world is reeling from coverage selections in response to COVID-19 19, and the Russian invasion of Ukraine has not helped both.”

Oil falls 8% as global recession fears spook market | Oil and Gas News

Rising coronavirus circumstances in China and looming US inflation knowledge are stoking issues about crude demand.

By Bloomberg

Oil tumbled as issues a few world financial slowdown and rising Covid-19 circumstances in China diminished merchants’ urge for food for danger.

West Texas Intermediate shed greater than 8% to settle underneath $96 a barrel for the primary time since early April. Rising virus circumstances in China and looming US inflation knowledge are stoking issues about demand. In the meantime, dwindling liquidity can also be exacerbating worth strikes. Cash managers have turn into extra bearish on the primary oil benchmarks, slicing their net-long positions final week to the bottom since 2020.

“The volatility in commodity markets will increase the stakes for placing cash to work,” stated Rebecca Babin, senior vitality dealer at CIBC Non-public Wealth Administration. “The decimation of different commodities has additionally diminished danger urge for food for crude even in a supply-constrained market.”

Regardless of recession fears, a number of vitality administrations agree that provide tightness is ready to worsen. IEA’s Government Director Fatih Birol stated nations “may not have seen the worst” of a world vitality crunch whereas OPEC’s first take a look at 2023 confirmed no reduction from market tightness. Underscoring provide constraints, the US lowered its progress forecast for oil manufacturing by means of 2023 citing inflation and labor shortages.

Concerns of an economic slowdown have weighed on crude

Crude has fallen since early June on escalating fears the US could also be pushed right into a recession as central banks hike charges to fight inflation. But bodily markets proceed to indicate indicators of energy. Premiums for North Sea oil have been bid on the highest since at the very least 2008. The oil futures curve additionally stays backwardated, the place near-term contracts are dearer than these for later supply.

Costs

  • WTI for August supply dropped $8.25 to settle at $95.84 a barrel in New York.
  • Brent for September settlement fell $7.61 to settle at $99.49 a barrel.

President Joe Biden is scheduled to go to Saudi Arabia this week throughout a tour to the Center East as he seeks to tame excessive vitality costs which have roiled the worldwide financial system.

The US believes OPEC has room to elevate manufacturing ought to Biden’s upcoming go to to the area yield any agreements. France’s President will meet with the chief of the UAE subsequent week to debate oil provides.

–With help from Alex Longley.

Europe faces gas supply disruption after Russia imposes sanctions | Oil and Gas News

Moscow’s measures and Ukraine’s halting of a significant provide path to Europe have despatched costs on the continent hovering.

Europe is dealing with elevated stress to safe various fuel provides after Moscow imposed sanctions on European subsidiaries of Russia’s state-owned Gazprom vitality large and Ukraine shuttered a significant fuel transit route, pushing costs greater.

Dutch fuel costs on the TTF hub, the European benchmark, rose by about 20 p.c on Thursday morning.

The uptick got here after Russia rolled out its sanctions late on Wednesday, primarily on Gazprom’s European subsidiaries together with Gazprom Germania, an vitality buying and selling, storage and transmission enterprise that Germany positioned underneath trusteeship final month to safe provides.

Moscow additionally focused the proprietor of the Polish a part of the Yamal-Europe pipeline that carries Russian fuel to Europe, EuRoPol Gaz. The pipeline is collectively owned by Gazprom.

“A ban on transactions and funds to entities underneath sanctions has been carried out,” Gazprom mentioned in an announcement. “For Gazprom, this implies a ban on using a fuel pipeline owned by EuRoPol GAZ to move Russian fuel by way of Poland.”

Kremlin spokesperson Dmitry Peskov mentioned there will be no relations with the businesses affected nor can they participate in supplying Russian fuel.

The entities on an inventory of affected corporations on a Russian authorities web site had been largely based mostly in nations which have imposed sanctions on Russia in response to its invasion of Ukraine, most of them members of the European Union. Final 12 months, EU nations received about 155 billion cubic metres of fuel from Russia.

Germany, Russia’s prime consumer in Europe, mentioned some subsidiaries of Gazprom Germania had been receiving no fuel due to the sanctions, however are searching for options.

“Gazprom and its subsidiaries are affected,” Habeck instructed the Bundestag decrease home. “This implies a few of the subsidiaries are getting no extra fuel from Russia. However the market is providing options.”

INTERACTIVE - Russian gas imports into the EU - Europe's reliance on Russian gas

Ukraine shuts main transit route

Russia’s sanctions got here a day after Kyiv shut a significant fuel transit path to Europe, blaming interference by occupying Russian forces, the primary time exports by way of Ukraine have been disrupted since Moscow launched its invasion in late February.

The transit level Ukraine shut normally handles about 8 p.c of Russian fuel flows to Europe, and Kyiv proposed that flows may very well be re-directed to another transit level, Sudzha.

On Thursday morning, flows by way of Sudzha had fallen to 53 million cubic metres (mcm) per day, from roughly 70 mcm the day earlier than, Ukraine fuel transmission operator knowledge confirmed.

Nevertheless, the Ukrainian suspension doesn’t current a direct fuel provide subject, the European Fee mentioned.

In the meantime, there may be nonetheless confusion amongst EU fuel firms a couple of fee scheme decreed by Moscow in March that the European Fee has mentioned would breach EU sanctions.

Russia’s demand that future funds for fuel be made in roubles has been rejected by most European patrons over the main points of the method, which requires opening accounts with Gazprombank.

That has generated fears about potential provide disruptions ought to patrons refuse to satisfy the rules to keep away from breaching sanctions.

The issues got here towards the backdrop of a significant improve in European wholesale fuel costs through the previous 12 months, including to burdens on households and companies as they search to rebound from the financial disruption unleashed by the COVID-19 pandemic.