Archives for November 2018

The minister says the conflict between Russia and Ukraine has nothing to do with the project.

“These are two different issues, two different areas,” Altmaier said in an interview with ARD television, stressing that his office strongly opposes the termination of the pipeline’s construction.

On Wednesday, German government spokesman Steffen Seibert confirmed that Berlin is committed to the Nord Stream 2 pipeline despite escalating tensions in Ukraine.

US threatens to punish Russia Germany if they continue playing with gas

“I have taken note of the criticism but nothing has changed in the basic view of the economic project, which is what Nord Stream is,” Seibert told journalists in Berlin.

The Nord Stream 2 pipeline has been slammed by Ukraine, the US and some other nations for various reasons. They have stepped up criticism of the project since Ukrainian Navy vessels violated the Russian maritime border in the Black Sea on Sunday morning, triggering an unavoidable standoff.

Ukrainian officials have repeatedly appealed to Germany and the European Union, asking for the project to be put on hold. According to Kiev, the future pipeline would bypass Ukraine and deprive its budget of transit fees. At the same time, Berlin and Moscow assured Kiev that gas transit through Ukraine to Europe would be maintained.

At the same time, the White House has attacked the pipeline as another step towards deepening Europe’s dependence on Russian gas, that is allegedly used by Moscow as a manipulative tool. Washington threatened to impose punitive measures against corporations engaged in the construction of the gas pipeline.

Moreover, the US government is currently trying to fight for its own share of the European energy market, trying to sell more of its liquefied natural gas (LNG). In October, The German federal government agreed to co-finance the construction of a €500 million ($576 million) LNG shipping terminal in northern Germany.

The Nord Stream 2 gas pipeline project is set to run from Russia to Germany under the Baltic Sea. It is expected to double the existing pipeline’s capacity of 55 billion cubic meters annually. Nord Stream 2 is projected to provide transit for 70 percent of Russian gas sales to the EU. The project, led by a subsidiary of Russian energy giant Gazprom, is being implemented in partnership with German energy firms Wintershall and Uniper, French multinational Engie, British-Dutch oil and gas giant Royal Dutch Shell, as well as Austrian energy company OMV.

For more stories on economy finance visit RT’s business section

Article source: https://www.rt.com/business/445150-german-minister-nord-stream-ukraine/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Speaking at the first Russian-Chinese Energy Forum in Beijing, he said the total volume of Rosneft’s crude shipments to China is expected to exceed 50 million tons this year. “Rosneft is one of the leaders in terms of petrochemical supplies to China,” he said.

According to Sechin, the company supplied about 40 million tons of oil last year, “thereby providing about 6.5 percent of China’s total raw materials demand.”

Also on rt.com Russia tightens oil grip as top crude supplier to China

The CEO said: “Taking into account the mutual trade turnover on already concluded contracts, the total volume of deals between Rosneft and its Chinese partners will exceed $500 billion by 2035.”

He noted that “Beijing, in turn, is interested in ensuring its energy security and reliable supply channels.”

READ MORE: Russia plans to boost trade with China to $200bn by 2024

Statistics show that Russia was the largest crude oil supplier to China for the past two years on an annual basis. Exports of Russian oil to China have more than doubled over the past six years, up by more than 550,000 barrels per day.

In 2011, Russia began supplying China with crude through the Skovorodino-Mohe branch of the ESPO pipeline. That followed Rosneft, Transneft, and China National Petroleum Corporation (CNPC) signing agreements.

Also on rt.com Power play: China wants to boost trade energy cooperation with Russia

Rosneft and CNPC inked a 25-year oil deal in 2014 worth $270 billion under which the Russian company is expected to supply 360.3 million tons of crude to China. Since then, Russia has overtaken Saudi Arabia to become China’s biggest crude supplier.

Last year, Rosneft agreed crude oil deliveries with China’s CEFC Energy. According to the agreement, the Russian oil major will supply CEFC with 60.8 million tons of oil annually until 2023.

For more stories on economy finance visit RT’s business section

Article source: https://www.rt.com/business/445140-rosneft-china-energy-cooperation/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

After a public outcry in Germany in 2013, authorities started the repatriation program, aimed at returning the country’s gold reserves, which have been stored outside of the country since the Cold War. Berlin intended to get at least half of the country’s gold from the US and France by 2020. The government had initially planned to complete the program within a five-year period, but the US Federal Reserve renegotiated the process to a seven-year timeline.

Bank of England refuses to hand over Venezuela’s gold – report

The country reportedly managed to ship only five tons of its gold in 2013 due to logistical difficulties. The following year, Germany repatriated 120 tons of the precious metal – 35 tons from Paris and 85 tons from New York. Some 110.5 tons were brought back from Paris and 99.5 tons from New York in 2015. Two years ago, the country repatriated total of 200 tons.

So far, the Fed has denied the German financial regulator access to the vast deposits that are literally being held hostage overseas. Thus, the Bundesbank has had no opportunity to audit the reserves that belong to Germany.

Various theories circulated about Germany’s foreign gold reserves, with some experts questioning whether it is still there or if it has been used by foreign central banks. However, the German government doesn’t seem very worried about the issue.

“I haven’t heard that it is now becoming a hot topic, but in case it is, you should contact the Bundesbank. They would give you information about the current state of affairs and plans on this issue,” German Finance Ministry spokesman Dennis Kolberg told RT Deutsch during the weekly news conference.

“The Bundesbank has already spoken on this issue, so I can only refer to them,” the official said, when asked if the government has any plans to address the matter of the country’s gold being kept abroad.

For more stories on economy finance visit RT’s business section

Article source: https://www.rt.com/business/445133-germany-access-gold-us-fed/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

After a public outcry in Germany in 2013, authorities started the repatriation program, aimed at returning the country’s gold reserves, which have been stored outside of the country since the Cold War. Berlin intended to get at least half of the country’s gold from the US and France by 2020. The government had initially planned to complete the program within a five-year period, but the US Federal Reserve renegotiated the process to a seven-year timeline.

Bank of England refuses to hand over Venezuela’s gold – report

The country reportedly managed to ship only five tons of its gold in 2013 due to logistical difficulties. The following year, Germany repatriated 120 tons of the precious metal – 35 tons from Paris and 85 tons from New York. Some 110.5 tons were brought back from Paris and 99.5 tons from New York in 2015. Two years ago, the country repatriated total of 200 tons.

So far, the Fed has denied the German financial regulator access to the vast deposits that are literally being held hostage overseas. Thus, the Bundesbank has had no opportunity to audit the reserves that belong to Germany.

Various theories circulated about Germany’s foreign gold reserves, with some experts questioning whether it is still there or if it has been used by foreign central banks. However, the German government doesn’t seem very worried about the issue.

“I haven’t heard that it is now becoming a hot topic, but in case it is, you should contact the Bundesbank. They would give you information about the current state of affairs and plans on this issue,” German Finance Ministry spokesman Dennis Kolberg told RT Deutsch during the weekly news conference.

“The Bundesbank has already spoken on this issue, so I can only refer to them,” the official said, when asked if the government has any plans to address the matter of the country’s gold being kept abroad.

For more stories on economy finance visit RT’s business section

Article source: https://www.rt.com/business/445133-germany-access-gold-us-fed/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

“The United States is not just exporting energy, we’re exporting freedom,” US Secretary of Energy Rick Perry said in early 2018. “We’re exporting to our allies in Europe the opportunity to truly have a choice of where do you buy your energy from. That’s freedom. And that kind of freedom is priceless…There’s no strings attached when you buy American [liquid natural gas]. So that’s world-changing.”

That comment from Perry crystalizes conventional wisdom in Washington. Europe relies on Russia for about a third of its gas needs. For years, Russia’s Gazprom was able to bind various European countries up into rigid contracts with fixed prices, often linked to higher crude oil prices. Worse, Russia tended to negotiate bilateral deals, and would offer preferential terms to friendly countries and higher prices to others. These practices raised the ire of the European Commission’s antitrust regulator, which forced Gazprom to dial back on such strong-arm tactics.

Russian natural gas vitally important for Europe – Gazprom

But with few alternatives, there was little prospect of fundamental change – Europe would still need Russian gas for the long haul.

The most promising alternative came from US LNG (liquefied natural gas). Cheap shale gas sparked a wave of investment earlier this decade. Cheniere Energy brought its Sabine Pass LNG facility online nearly three years ago, and several more terminals are in the works.

The mere threat of American LNG arriving in Europe arguably weakened Gazprom’s hand. Lithuania, for instance, forced Gazprom to agree to pricing concessions when it managed to bring in a floating LNG import terminal, opening up the door to imported gas from places other than Russia.

Last year, the first American LNG cargo arrived in Lithuania. “US gas imports to Lithuania and other European countries is a game changer in the European gas market. This is an opportunity for Europe to end its addiction to Russian gas and ensure a secure, competitive and diversified supply,” Lithuanian President Dalia Grybauskaite wrote to Foreign Affairs at the time.

However, things have not changed as much as some had hoped. Russia’s market share in Europe is little changed. This has occurred for several reasons. First, very few US LNG cargos have actually arrived in Europe. Second, Russia is not sitting by watching its position erode. Instead, it has expanded its own use of LNG and it has also redoubled its efforts at locking European buyers into gas via pipelines.

Moreover, as Russia faces some challenges in Europe, it has also pivoted to Asia to diversify its markets. China is the world’s fastest growing gas market, and China is one of the biggest reasons why global LNG prices have rebounded much quicker than analysts anticipated. Russia would be foolish not to focus gas sales on China. The two countries are set to open a long distance pipeline by the end of next year that will move more Russian gas into China. Russia’s LNG shipments to India are also picking up.

Also on rt.com First LNG shipment from Russia’s Arctic to arrive in Northern Europe

It’s a two-prong strategy that has proven successful to date. “Our main goal is to preserve our current markets, primarily Europe, and to gain a foothold in new ones, especially Asia,” Alexey Teksler, Russia’s first deputy Minister of Energy, told the Wall Street Journal. Over time, China is set to take on much greater importance for Gazprom.

While Rick Perry wants to export more freedom, the US-China trade war has resulted in Chinese tariffs on American LNG. That will make US gas much less competitive in China relative to other sources of gas, such as from Russia.

It is not as though US LNG has not had any impact at all. The pricing concessions offered by Gazprom, and the increasing shift towards more market-based pricing for Gazprom in Europe (as opposed to rigid contracts), is arguably the largest achievement that American LNG has secured. According to the WSJ, Gazprom’s average selling price fell by nearly 50 percent since 2013, although much of that is also the result of falling crude oil prices. Competition from the US, as well as antitrust scrutiny from Brussels, means that Gazprom cannot demand exorbitant prices.

But other than that, US LNG has not done much else to beat back Russia in the European market.

Also on rt.com This landmark LNG deal will change energy geopolitics forever

Also, Russia can still offer cheaper gas than US suppliers in many places. Gazprom may have had to lower prices to Europe to keep US LNG out, but it can easily undercut American exporters. Even in India, Gazprom inked a 20-year agreement for gas at $7/MMBtu, which the WSJ says is about $1 to $1.50/MMBtu cheaper than anything coming from Qatar or the US.

Weakening Russia’s energy grip over Europe has been a perennial goal of US administrations dating back decades. But Russia continues to adapt and outmaneuver Washington.

This article was originally published on Oilprice.com

Article source: https://www.rt.com/business/445124-russia-outmaneuvers-us-lng/?utm_source=rss&utm_medium=rss&utm_campaign=RSS