Inside Oil - Tuesday December 27 2011

TUESDAY, DECEMBER 27, 2011  To download the full report (PDF document) please click here     COLUMN:   US Congress hands energy industry historic victory: Kemp --John Kemp is a Reuters market analyst. The views expressed are his own--  LONDON, Dec 23 (Reuters) - In a crushing demonstration of the growing power of domestic energy producers, and waning influence of environmental groups, Congress is poised to enact legislation fast-tracking approval for the controversial Keystone XL pipeline.  It is a stinging defeat for environment groups that have lobbied fiercely against the Keystone extension, and comes little more than a month after the president had sought to take the heat out of the issue by postponing approval beyond the next election pending a review of alternative routes through Nebraska.   MARKET NEWS:   Oil edges up towards $100 on supply worries SINGAPORE, Dec 27 (Reuters) - U.S. crude oil edged up towards $100 a barrel on Tuesday, supported by supply disruptions in Syria and Iranian naval exercises in a key shipping lane. Iran on Saturday began 10 days of naval exercises in the Strait of Hormuz, raising concern about a possible closure of the world's most strategic oil transit channel in the event of any outbreak of military conflict between Tehran and the West. GLOBAL MARKETS-Asian shares steady in thin holiday trade, US mkt eyed TOKYO, Dec 27 (Reuters) - Asian shares were steady on Tuesday in thin volume as investors took to the sidelines before U.S. markets reopen later in the day from a long weekend and data which could offer clues over growth prospects in the world's largest economy.  European and some Asian markets, including Hong Kong and Australia, were closed on Tuesday. "Shares are expected to drift sideways as passive interests prevail in typical year-end fashion, and as many stock markets were closed for the holidays yesterday, providing no dynamic whatsoever," said Lee Kyung-soo, an analyst at Shinyoung Securities.     Iran inks oil products deal with Afghanistan TEHRAN, Dec 26 (Reuters) - Iran signed an agreement with Afghanistan on Monday to export one million tons per year of gasoil, gasoline and jet fuel to the neighbouring country starting next year, the official IRNA news agency reported. The Islamic state, which was long dependent on imported gasoline for 30 to 40 percent of its consumption, said last year it had started exporting the fuel. The sales were confirmed to Reuters by trade sources, but they did not know at the time where the cargoes were being exported. Ecuador says oil output up slightly in 2011 QUITO, Dec 26 (Reuters) - OPEC-member Ecuador increased crude production in 2011 by 3 percent to just over 500,000 barrels of oil per day, the Ministry for Non-renewable Natural Resources said on Monday. After taking office in 2007, Ecuador's leftist President Rafael Correa introduced reforms to increase state revenue from the oil industry, which led companies to freeze investments. Storm hits Norway gas plants, exports cut OSLO, Dec 26 (Reuters) - A powerful North Sea storm knock off power to two key gas installations in Norway during the night between Sunday and Monday, curtailing gas exports to the rest of Europe. The plant processing gas from Royal Dutch Shell 's offshore Ormen Lange field, which can provide some 20 percent of Britain's gas demand, remained shut on Monday while the Kollsnes plant further down the coast restarted operations after sustaining two shutdowns. Afghanistan cabinet OKs oil deal with China's CNPC KABUL, Dec 26 (Reuters) - Afghanistan's cabinet cleared the way for the war-torn state to sign a deal with China National Petroleum Corp (CNPC) for the development of oil blocks in the Amu Darya basin, the Afghan president's office said on Monday. The deal covering drilling and a refinery in the northern provinces of Sar-e Pul and Faryab will be the first international oil production agreement entered into by the Afghan government for several decades. Bangladesh state firm says finds more gas reserves DHAKA, Dec 26 (Reuters) - State-run Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX) said on Monday that it had discovered significant new gas reserves at a field in the country's northeast. "We will be able to extract up to 40 million cubic feet of gas per day from the newly found well at Fenchuganj in Sylhet district, 280 km (175 miles) from Dhaka," Mortuza Ahmad Faruque, managing director of BAPEX, told Reuters. Japex delays Canada oil sand investment decision TOKYO, Dec 26 (Reuters) - Japan Petroleum Exploration  said on Monday it was delaying a final investment decision (FID) on its Hangingstone oil sand expansion project in Canada to around mid-2012 from its previous plan of this winter due to a delay in Canadian government approval. The company said it had hoped to receive permission for the development by the end of the year, but it now expects government approval to take another six months. Taiyo Oil sees minor CDU turnaround-source TOKYO, Dec 26 (Reuters) - Japan's Taiyo Oil Co Ltd is likely to conduct minor planned maintenance on two crude distillation units (CDUs) at its sole Shikoku refinery in western Japan in 2012, an industry source familiar with the matter said on Monday. The company is also set to schedule a turnaround on the plant's 25,000 barrels per day residue fluid catalytic cracker (RFCC) next year, the source said. Turkey to sign gas pipeline deal with Azerbaijan on Dec. 26 ISTANBUL, Dec 25 (Reuters) - Azerbaijan and Turkey will sign a memorandum of understanding on Dec. 26 to build a Trans-Anatolian gas pipeline project, which will carry Azeri gas across Turkey to Europe, Turkish energy ministry said in a statement on Sunday.  Azeri state energy company SOCAR, Turkey's state pipeline company Botas and Turkey's state energy company TPAO will be the initial partners in the project and other international oil and gas companies may join the consortium during the process, it said.     BEYOND THE HEADLINES:   Oil fund BlueGold loses focus, sinks deep into red NEW YORK, Dec 22 (Reuters) - Respected commodities hedge fund BlueGold has veered from its energy-focused strategy, betting almost half its money on equities and other trades that are worrying investors as it turns in its first down year.  The London-based fund, founded by former Vitol oil traders Dennis Crema and Pierre Andurand, is heading for a negative annual return, losing 34 percent through mid-December. Its asset base is down to $1.2 billion from $2 billion about a year ago.   Kazakh leader reinforces power with oil sackings ALMATY, Dec 23 (Reuters) - Kazakh President Nursultan Nazarbayev's decision to fire his son-in-law for mishandling an oil workers' strike is a signal to would-be successors that the veteran leader is not ready to relinquish his firm grip on power in the Central Asian state.  By removing Timur Kulibayev from the top job at the sovereign wealth fund, 71-year-old Nazarbayev is unlikely to appease the families of those killed when police opened fire during clashes that killed 16 in a western oil region last week.   Petronas in talks with oil majors for petchem tie-up KUALA LUMPUR, Dec 23 (Reuters) - Petronas is in talks with several global oil majors including Shell  and Exxon Mobil  to develop petrochemical plants within its $20 billion refinery complex in southern Malaysia, two sources with direct knowledge of the matter said.  Malaysia's national oil company is also talking to Japanese firms Itochu Corp  and Mitsubishi Corp  as well as to Dow Chemical Co  -- the largest U.S. chemical maker -- as it seeks to tap surging Asian demand and diversify its earnings, the sources told Reuters.       EVENTS TO WATCH TODAY (GMT)   U.S. API WEEKLY CRUDE STOCKS WEEKLY (2130)   U.S. API WEEKLY DIST. STOCKS WEEKLY (2130)   U.S. API WEEKLY GASOLINE STK WEEKLY (2130)   JAPAN CPI, CORE NATIONWIDE YY NOV 2011 (2330)   JAPAN INDUSTRIAL OUTPUT PRELIM MM NOV 2011 (2350)   MORE INFORMATION   Learn more about our products and services for Commodities Professionals click here Contact Thomson Reuters click here To subscribe to this and other Commodities News Briefs click here  Join our market Forums. To find out more click here: • Oil Forum • Ags Forum • Base Metals Forum • Gold Forum • European Power & Gas  Forum • North American Power & Gas Forum     Knowledge Network: Interactive training for your Thomson Reuters desktop. 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