UPI Energy Watch

Sept. 15, 2008 at 3:21 PM
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Hurricane Ike does little long-term damage to Gulf energy installations

Though the massive hurricane shut down about 98 percent of refining capacity in the Gulf of Mexico, oil prices remained below $100 a barrel Monday, The Telegraph reported.

Shell and other oil companies reported that most of the production shutdowns were due to fears of damage and staff evacuations.

Because most of the damage was to the refineries and not the drilling rigs, gasoline prices throughout the southeastern United States jumped significantly over the weekend.

Royal Dutch Shell reported to The Telegraph that it was sending workers back to its offshore rigs in the Gulf.

Analysts said the supply disruptions are likely to be temporary and will not stop the recent oil price decrease trend. Global oil prices have been falling since they peaked near $150 in July.

Major economic woes in the United States, Europe and Japan have been pointed to as the reason for the falling oil prices by some market analysts.

Another potential hit to the market, a production cut of 500,000 barrels per day by the Organization of Petroleum Exporting Countries, also has had little to no impact on the global price of oil.

India, Bangladesh discuss Bay of Bengal rights

Leaders of the two nations have long disputed the maritime boundary in the bay and for three days will discuss the allocation of offshore oil and gas exploration rights, the Economic Times reported.

The last extended meeting between the two nations was held in 1982. The bay is shared between Bangladesh, India and Myanmar, but there is no demarcation, which has created disputes over offshore oil and gas searches.

Earlier this year New Delhi and Yangon opposed Bangladesh's offshore block bidding, and before that Dhaka opposed India and Myanmar's floating of an international tender for searching offshore in 2006.

The Bay of Bengal has become even more important following India's discovery of 100 trillion cubic feet of gas and 2 billion barrels of oil in 2005 and 2006 and then Myanmar's discovery of 7 trillion cubic feet of gas at the same time.

The three countries are currently working with the United Nations on demarcation. International law allows each country up to 200 nautical miles from its coast and says they must inform each other when they will be exploring.

Nigerian militants upped their attacks on oil

Rebels from the Movement for the Emancipation of the Niger Delta have claimed responsibility for recent attacks in Nigeria's oil region, Xinhua reported.

The statement, signed by a MEND spokesman, admitted that rebels set fire to the Alakiri flow station complex owned by the Royal Dutch Shell Petroleum Co. There were casualties, but a specific number has not been confirmed.

Attacks on pipelines and refineries have made it difficult for Nigeria to attract foreign investors. The country's oil revenues have dropped more than 25 percent since 2006, when the attacks picked up.

Xinhua reported that MEND has declared an "oil war" against Nigerian military forces and demanded that oil workers in the Delta region stop production and leave or face consequences.

The Nigerian government has set up a new ministry called Ministry of Niger Delta to facilitate peace, Xinhua reported.


Closing oil prices, Sept. 15, 3 p.m. London

Brent crude oil: $97.91

West Texas Intermediate crude oil: $101.74


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