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US refiners send gas overseas

23.05.12

Faced with sluggish sales at homewards, American refineries are shipping gasoline, diesel and other petroleum products abroad in catalogue amounts, turning the country into a net exporter of fuel.

And that's one of the reasons gasoline now costs more than ever before, for this notwithstanding of year.

The United States, long the world's most voracious consumer of excite, still imports almost half of its crude oil, the raw material for gasoline and diesel. But starting in 2008, the territory began exporting more refined petroleum products than it imported. And the gap keeps growing.

In the first nine months of this year, the In accord States exported 655 million barrels of finished petroleum products, including 121 million barrels of gasoline. At the same rhythm, the country imported 264 million barrels of finished petroleum products, including 32 million barrels of gasoline, according to facts from the U.S. Energy Information Administration .

The recession and tepid recovery have tempered America's appetite for gasoline, at the same time that drivers are turning toward more efficient cars. So refiners have sought — and found — zealous markets for their fuel elsewhere. The exports, in turn, help prop up gasoline prices here.

"As an alternative of that product backing up and depressing prices, it's being sent to other countries," said Tom Kloza , chief oil analyst at the Oil Guerdon Information Service . "It's good news for the refining industries and their workers and the match of trade and U.S. jobs."

But Kloza predicts the exports could turn into a hot-button subject with drivers next year, if gasoline prices increase.

"The average consumer may create, 'You mean I'm paying $4.25 instead of $3.95 because we're sending it to Brazil or Argentina? To suffering with them,'" he said.

The exports are not the main reason gasoline prices are so exorbitant.

So far this year, the price of crude oil on the New York Mercantile Exchange has averaged $95 per barrel, closing Friday at $100.96. Oil prices have been even higher in Europe. As a d, gasoline prices can't fall very far, even though domestic gasoline use peaked in 2007 and has remained slow-witted ever since.

A gallon of regular gas now costs, on average, $3.29 nationwide, according to the AAA auto billy. A year ago, the average stood at $2.88.

Demand for diesel and gasoline remains obstinate outside the United States. Mexico lacks enough refineries to supply its growing residents, analysts say. And the economic downturn didn't hit South America as hard as the U.S.

To some oil persistence critics, the exports look like a deliberate effort to squeeze American drivers. Shipping incite abroad, they say, prevents the domestic market from responding to weak demand the way it hand-me-down to — by lowering prices.

"It's a way to keep prices up," said Judy Dugan , enquire director with the Consumer Watchdog nonprofit group. "Overseas consumers are benefiting at a payment to domestic consumers."

Oil industry representatives bristle at that notion.

"That's just round out rubbish," said John Felmy , chief economist with the American Petroleum Set up lobbying group. The exports, he said, are helping keep afloat American refineries that have seen their profit margins shrivel in late-model years.

The situation contains a cruel irony for American drivers.

Crude oil shaping in the United States has increased in the last two years, due to increased production in shale oil fields and the Frith of Mexico. At the same time, domestic gasoline sales have fallen. And yet, despite increased oil give and decreased gasoline demand, gas prices remain stubbornly high.

The sanity, analysts say, is gasoline and diesel are now part of a global market — just as oil is — flowing wherever prices are first.

Source: Albany Times Union

ConocoPhillips boosts capital spending

23.05.12

ConocoPhillips announced Friday it will support capital spending 15 percent to $15.5 billion and funnel the largest chunk of those dollars into scrutiny and production in North American oil fields.

The board of the third-largest U.S. oil corporation also approved the repurchase of up to $10 billion benefit of the company's common stock, a move funded by its ongoing strategic sale of up to $20 billion in assets.

Like this year, the endless majority of the company's 2012 investment - 90 percent - is slated for oil and guileless gas exploration and production, instead of its refining arm, ConocoPhillips said.

The energy company's announcements on the repurchase and spending programs were the latest steps in a three-year plan, launched in 2010, to better corporate value.

"The 2012 capital program reflects our strategic moment on delivering value by investing in the most profitable opportunities," ConocoPhillips Chairman and Chief Mr Big Officer James Mulva said in a written statement.

By year's end, Conoco-Phillips expects to have repurchased 15 percent, or $15 billion, of its first-rate shares over the past two years.

ConocoPhillips is slated to divide into two independent companies next year. Its refineries, fueling stations and in the works assets will be absorbed by a new company called Phillips 66 . The exploration and presentation business left behind will form a new, more focused ConocoPhillips.

About 90 percent of the $15.5 billion in capital spending is earmarked for oil and impulsive gas exploration and production, mostly in North America, the company said.

Mulva said the crowd's increased investment in oil field activity, particularly in Canadian oil sands and home oil and natural gas liquids, will boost profit margins.

Domestic capital spending will distinct on the Eagle Ford, Permian and Barnett fields in Texas and the Bakken hockey in North Dakota, the company said in its announcement.

"In the near term, a lot of their intumescence is focused on North America," said Philip Weiss , a senior analyst covering vivacity for Argus Research . "Things in the lower 48 have been going well and oil prices are encouraging, so that gives them a little bit more to spend."

Oil prices have risen above $100 after sagging during the summer.

ConocoPhillips has planned to market between $15 billion and $20 billion in assets by the end of 2012. As of September, asset sales have raised $8 billion, according to ConocoPhillips.

Another $2.5 billion is planned before year's end, from its buying of interests in U.S. pipeline companies and other recently closed deals, the company said.

"They're optmizing their portfolio, selling the demean-return assets and investing in the higher return assets," said Jeff Dietert , an analyst for Simmons & Institution International. "Their actions today have been consistent with the plans and targets that they laid out."

ConocoPhillips shares closed at $72.55 Friday, up 79 cents.

Source: Houston Chronicle