Friday, April 29, 2011
World News: Libya NewsGaddafi Loyalists Spill Over Into Tunisia
http://www.newsy.com/videos/gaddafi-loyalists-spill-over-into-tunisia/
BY SAMUEL JOSEPH
ANCHOR MEGAN MURPHY
You're watching multisource global video news analysis from Newsy.
An unexpected new conflict -- reports indicate forces loyal to Libyan leader Muammar Gaddafi spilled over into neighboring Tunisia in their efforts to chase rebels in the western border town of Dahiba.
ANITA MCNAUGHT: “Things have taken an extraordinary turn at this crossing, Nick. We understand that not only have Gaddafi troops crossed over the border crossing into Tunisia, but they are now engaged in combat in the border town of Dehiba with Tunisian forces trying to stop them from advancing any further.
Dahiba was captured by the rebels last week, prompting retaliation from loyalist forces and the fight that took them into another country -- but it wasn’t just soldiers crossing. Sky News says there was some firepower thrown over the line as well.
ANCHOR: “Well, there was a very intensive attack by the Libyan government forces on this important border crossing at Dahiba. In which there were also some rounds, including mortar, three mortar rounds fired into Tunisian territory. Most likely by the Gaddafi forces. They were also using snipers across that border position at one point.”
Tunisian military have captured fifteen vehicles from Gaddafi forces and experts say the border town of Dahiba is vital to the rebel cause. The Wall Street Journal calls it...
“...a significant advance beyond their eastern Libyan strongholds that enabled them to bring in supplies by road through the Tunisian border... Loss of the crossing would sever the rebels' only paved road to the outside world.”
And that isn’t its only importance -- The Christian Science Monitor says the rebel occupation of the town represents Gaddafi’s weakening control over the western side of the country.
“...Qaddafi, who has mostly been focused on Misurata (Miz-raa-tah) for weeks, is now being drawn in other directions. While a few weeks ago Misurata was seen as a lone western holdout, its successful defiance of the government ... has inspired rebel gains elsewhere in the west.”
According to Reuters soldiers loyal to Gaddafi have been returned over the border and the town is now firmly in the hands of the rebels.
Get more multisource world video news analysis from Newsy.
Transcript by Newsy.
Party may be over for Big Oil stocks
By Paul R. La Monica, assistant managing editor
NEW YORK (CNNMoney) -- Oil stocks have been gushing all year thanks to surging crude prices. But is the party almost over?
Energy giants ConocoPhillips (COP, Fortune 500), Exxon Mobil (XOM, Fortune 500), Royal Dutch Shell (RDSA) and Chevron (CVX, Fortune 500) all reported enormous jumps in profits in the past few days. Investors were largely unimpressed, however.
Prices at the pump can vary widely among states due to a number of factors.
High gas prices have led me to change my...
CommuteTravel and leisure activities Both Neither or View resultsShares of ConocoPhillips fell Wednesday as its profits missed forecasts. Exxon's stock fell Thursday after its earnings release. Shell gained less than 1%. And Chevron was down Friday morning following its latest quarterly results.
It appears investors may have already priced in strong earnings. Expectations may now be unreasonable. After all, Exxon and Chevron are each up nearly 20% this year, making them among the best performers in the Dow Jones industrial average so far in 2011.
"It's a crowded trade right now. The energy sector is overbought compared to the overall market," said John Kosar, director of research with Asbury Research in Chicago.
There's chatter about how oil sector profits could top the records from 2008 -- even though crude prices are still a good $30 or so below the July 2008 peak.
But if oil prices don't reach new records, it may be tough for profits to surpass 2008 levels. That could mean an end to the big rally for energy stocks, which -- as the chart at the top of this column clearly shows --- have been tracking the price of crude quite closely.
"Investors are looking past the strong oil company results," said Richard Ross, global technical strategist with Auerbach Grayson, a brokerage in New York.
"They are saying 'You didn't make money because of your operational genius, but because you're supposed to make money when oil is at multi-year highs,' " he added.
Exxon hits back at gas price anger
Perry Piazza, director of investment strategies at Contango Capital Advisors, wealth management firm in San Francisco, said that investors also may be starting to figure out that oil prices are only this high because of turmoil in the Middle East and North Africa.
That can't last forever. He said the fair value for oil (based on actual supply and not fear of supply disruptions) probably is more in a range of $85 to $100 as opposed to $120 or higher.
At the same time, energy companies (and investors) seem to be looking for other opportunities beyond good-old fashioned oil.
French oil giant Total (TOT) announced late Thursday that it was planning to buy a majority stake in U.S. solar energy firm SunPower (SPWRA).
Shares of SunPower surged 35% on the news, and rivals in the U.S., Canada and China, such as First Solar (FSLR), Canadian Solar (CSIQ) and Yingli Green Energy (YGE), all popped as well.
Solar stocks have been on a tear since the Japan earthquake in March. Investors are betting that more countries will scrap nuclear plants due to meltdown fears at reactors damaged by the quake and tsunami.
Coal stocks have also benefited in the past month as a sort of "alternative" energy play.
The coming commodity price nightmare
As long as oil prices remain relatively high, investors are likely to keep searching for other energy sector bets. The memory of 2008 is still fresh in many people's minds. At some point, oil gets too high and when it turns lower, it can do so in violently quick fashion.
Sure, the oil companies may be cashing in now with crude as high as it is. But it seems as if investors are increasingly coming to the realization that this may be as good as it gets for oil.
Even if oil creeps a little higher from here, that may not be enough to excite energy investors.
"The market requires surprise. The surprise when it comes to higher oil prices is gone," said Keith Springer, president of Springer Financial Advisors in Sacramento, Calif.
Reader comment of the week. I had a lot of fun mocking Ben Bernanke's "historic" press conference on Wednesday over on Twitter. At one point, I joked that Bernanke was going to step down as Fed chairman in order to take over the day-to-day job overseeing the Los Angeles Dodgers.
The virtual peanut gallery was all in rare form. David Gaffen of Reuters had this response to my baseball line.
"So he can bail them out by giving them 6 outs every inning?"
Nice one David! I tossed you a meatball right over the middle of the plate and you knocked it out of the park.
The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, and Abbott Laboratories, La Monica does not own positions in any individual stocks.
Gold futures jump over $25 to settle at a record. WOW!
By Myra P. Saefong
SAN FRANCISCO (MarketWatch)
Gold futures settled at a record Friday, jumping more than $25 an ounce by the close as weakness in the U.S. dollar and expectations for further declines in the greenback drove investors toward the relative safe haven of precious metals. Gold for June delivery GCM11 +1.97% jumped $25.20, or 1.7%, to settle at $1,556.40 an ounce on the Comex division of the New York Mercantile Exchange. Gold futures ended 3.5% higher for the week and finished the month with an 8.1% gain. July silver +2.08% also rose by 98.9 cents, or 2.1%, to $48.53 an ounce, though prices were not yet settled. Tracking the most-active contract, silver futures were trading 5.4% higher for the week, up 28% for the month.
Somali pirates release Panama-flagged bulk carrier
(Reuters) - Somali pirates have freed the Panama-flagged bulk carrier MV Renuar and its crew of 24 Filipinos after four months in captivity, the European Union's anti-piracy task force said on Thursday.
"The ship is now sailing to a safe port," EU Navfor said in a brief online statement.
Pirates firing rocket propelled grenades seized the 17,156 tonne vessel on December 11 as it headed to the United Arab Emirates from Mauritius.
EU Navfor did not say if a ransom had been paid.
(Editing by Richard Lough)
TOP Oil Market News: Naphtha in Asia Poised to Rise; OPEC Crude
By Jane, Ching Shen Lee
The following is a selection of the most important news affecting the oil market.
Naphtha in Asia Poised to Rise on Japan, Korea: Energy Markets
Naphtha premiums in Asia are poised to rise from a 17-month high as demand for the oil product in Japan and South Korea rebounds.
Democrat McCurdy Lobbies Past Republican Foes for Natural Gas
Dave McCurdy, the American Gas Association’s new chief executive officer, had to cut short a conversation about clean energy.
Baucus Releases Plan to End ‘Billions’ in Oil Tax Breaks (2)
Senator Max Baucus, chairman of the Senate Finance Committee, said he will write legislation to repeal billions of dollars in tax breaks for multinational oil and gas companies and use the money to back clean energy.
U.S. Energy Department Natural Gas Update for April 27
Following is the text of the weekly natural gas update as released by the U.S. Department of Energy in Washington D.C.:
Swiss Daybook: SNB Posts Profit, Roche, Glencore and Zurich
The Swiss National Bank, Switzerland’s central bank, reported a profit of 1.9 billion Swiss francs in the first quarter.
Gasoil Stockpiles Rise in Europe’s Oil-Trading Hub, PJK Says (1)
Gasoil stockpiles in independent storage in Amsterdam- Rotterdam-Antwerp, Europe’s oil-trading hub, rose to the highest in three weeks, according to PJK International BV, a researcher in The Netherlands.
OPEC
OPEC Crude Exports Drop as Slump Nears End, Oil Movements Says
The Organization of Petroleum Exporting Countries will cut exports by 1.2 percent in the four weeks to May 14 because of a seasonal decline in demand, according to tanker-tracker Oil Movements.
REFINERIES Map global refinery outages
Unipetrol First-Quarter Profit Rises 50% on Higher Crude Price
Unipetrol AS, the Czech Republic’s largest refiner, said first-quarter net profit rose 50 percent as increased prices of crude oil boosted the value of its inventory.
Syncrude Coker Turnaround Expected in September or October (1)
Canadian Oil Sands Ltd., the largest holder in the Syncrude Canada Ltd. oil-sands venture, said a turnaround on a coker will probably begin in September or October.
Syncrude Coker Turnaround Expected in September or October
Canadian Oil Sands Ltd. expects to begin a turnaround on its Syncrude coker in September or October, Chief Executive Officer Marcel Coutu said today in Calgary.
Texas Refineries Won’t Have Backup Power During Utility Work
Texas refineries that receive power from Texas New Mexico Power Co. won’t have access to backup electricity supplies for about a one- to two-day period each during several weeks of maintenance on transmission lines.
Gasoline Futures Little Changed as Dollar Rises Versus Euro
Gasoline was little changed, paring gains after reaching a 33-month high, as the dollar lessened its loss against the euro, reducing the investment appeal of commodities.
United Refining’s Pennsylvania Plant Returns Units Online (1)
United Refining Co.’s Warren, Pennsylvania, refinery is online after a power outage, Chief Executive Officer John Catsimatidis said in an e-mail.
Gunvor Buys European Gasoline; Naphtha Advances: Oil Products
Gunvor International AG bought barges of European Eurobob- grade gasoline after prices declined from a two-year high. Naphtha cargoes advanced to the highest level since 2008.
Hunt Starting Tuscaloosa Refinery After Power Outage (1)
Hunt Refining Co.’s plant in Tuscaloosa, Alabama, was being started today after a power outage caused by severe storms and tornadoes, said Drew Altemara, a company spokesman.
OTHER OIL MARKET NEWS
Indian Oil Seeks to Buy Crude Oil for Loading in July
Indian Oil Corp., the country’s biggest refiner, is seeking to buy crude oil for loading in July, according to two traders who received the tender document.
Supertanker Returns Fall 42%, Draw Nearer to Unprofitable Level
Returns from supertankers hauling Middle East oil to Asia, already at the lowest level in at least 33 months, slid closer to being unprofitable as a glut of ships competed for cargoes.
Dubai Widens July Oil-Price Differential to 40-Cent Discount (1)
Dubai oil, a Persian Gulf benchmark for Asia, will sell in July at its deepest discount in a year as buyers favor lighter, sweeter crudes over the more sulfur-heavy blends sold mainly in the Middle East.
TOP ENERGY STORIES
Tornadoes Ravage U.S. South, Killing Hundreds in Six States (1)
The worst day of tornadoes in 37 years tore through the U.S. Southeast, killing hundreds of people, causing millions in damage and cutting power to a nuclear plant.
Exelon to Buy Constellation for $7.9 Billion, Adding Nuclear (2)
Exelon Corp., the largest operator of U.S. nuclear power plants, agreed to buy Constellation Energy Group Inc. for about $7.9 billion in stock, adding stakes in five reactors and becoming the largest U.S. electricity marketer.
If Bill Gross Sees U.S. as Shaky, Check Japan: William Pesek
Salvador Dali or M.C. Escher?
U.S. Airline Surcharges Set Record at $420 as Oil Prices Climb
United Continental Holdings Inc., Delta Air Lines Inc. and rival U.S. carriers added a record $420 in fuel surcharges to round-trip European fares as soaring oil prices propelled first- quarter losses.
Total to Buy 60% of SunPower for $1.38 Billion in Solar Bet
Total SA, Europe’s third-biggest oil producer, agreed to buy as much as 60 percent of SunPower Corp. for $1.38 billion, to take advantage of increasing global interest in clean energy.
OTHER MARKETS
Asian Stocks, Oil Fall as U.S. Growth Slows; Yuan Strengthens
Asian stocks and crude oil fell for the first time in three days, while the won weakened after U.S. economic growth and South Korea’s industrial production missed economists’ forecasts. China’s yuan strengthened, breaking through 6.5 per dollar for the first time since 1993.
Uganda riots reach capital as anger against President Museveni grows
Impetus for Egyptian-style uprising increases as soldiers stage Kampala crackdown after opposition leader's arrest
http://www.guardian.co.uk/world/2011/apr/29/uganda-riots-kampala-museveni
David Smith in Kampala guardian.co.uk,
Protesters burn tyres and wood in Kampala after the riots, where army troops and police faced off against demonstrators in the capital for the first time. Photograph: Stephen Wandera/AP
Riots have swept across the Ugandan capital, Kampala, as protesters called for an Egyptian-style uprising against their autocratic president.
At least two people were killed and more than 100 wounded after soldiers fired live bullets and tear gas and beat demonstrators with sticks. Civilians fought back, blocking roads with burning tyres and pelting vehicles with rocks.
The growing unrest – sparked by rising food and fuel prices – gained fresh impetus after the brutal arrest of opposition leader Kizza Besigye on Thursday.
But President Yoweri Museveni, who was been in control for a quarter of a century, has met the protests with a show of force.
His military police were accused of attacking innocent spectators on Friday. One victim could be seen lying in a pool of blood, apparently after being shot in the head at a local market.
In the Karwerwe neighbourhood, police chased a teenager, Andrew Kibwka, with heavy wooden sticks and rained blows on him.
"I thought the police were going to kill me," he said minutes later, his arm bruised and a finger bleeding. "I was telling them I'm harmless, but they just carried on. I did nothing to provoke them. They beat me because I was running away."
The 18-year-old added: "I'm in pain all over my body. The police are being too brutal. I think Uganda will get worse if the president does not resign."
A minibus, a taxi and other vehicles that tried to travel up the street were pelted with stones. Then soldiers in armoured vehicles appeared and fired tear gas to disperse the crowd, and people ran away in panic.
Standing at a market, Robert Mayanja, who described himself as an activist, said: "What they are doing now shows that Museveni rigged the last election.
"If you look at Uganda, why should we vote for him after 25 years? We have high prices, we have hospitals without medicine. Is there anything to vote for?"
Mayanja, 31, said a repeat of the revolts in Egypt and Tunisia was "definitely" possible. "What we are seeing here are people who are not armed but are taking a stand against armed forces," he added. "People are ready. It's just a question of time.
"We know they are going to arrest many people and put them in torture chambers. We know this regime has expired. These are the signs."
Eric Mbiro, a 20-year-old student, agreed: "We are tired of this government because of the price of commodities," he said. "There is no presidency in Uganda. The president rules the country like his own home. He is a dictator. We need change."
But he was more sceptical about the prospects for an uprising, saying: "We will not manage to do what they did in Egypt because people here are poor. There is too much poverty in Uganda."
Military police fired live rounds, rubber bullets and tear gas at numerous burning barricades blocking the main road out of Kampala to the international airport in Entebbe and sprayed adjacent residential areas with bullets.
Shell casings littered the main road, tear gas hung in the air and security forces beat local residents.
In Ntinda, angry youths shouted and hurled stones and chunks of concrete at passing cars. On one corner, a man ran up to a council vehicle as it drove by and smashed the driver's window with a rock, raising cheers from onlookers.
A coded sign language is already in place. Motorists who hold two fingers aloft in a "v for victory" symbol, showing they support the rebellion, are allowed to pass unharmed, but a single raised thumb is interpreted as a pro-Museveni gesture.
Roads were blocked by rocks, cones, debris and burning tyres. A bare-chested man lay face down on the grass, his head being bandaged by Red Cross medics.
An eyewitness said the man had been the victim of an unprovoked attack. "The military police were making people clear the road, and this boy worked for 30 minutes," Timothy Ssenfuma, a 35-year-old electrical engineer, said. "He said he wanted to go, but they beat him on the head and back until he collapsed. They were also beating up even women and young ladies just to clear the road.
"They are killing innocent Ugandans who are not even involved in the uprising. We appeal to the rest of the world to help Ugandans as they have in Libya and elsewhere."
A teacher, who gave his name only as Nixon, claimed the security forces had launched an indiscriminate attack, saying: "The military police came and started beating up people.
"Some had to run away and others had to fight back to defend their friends. People have terrible anger at the way they were treated."
The 32-year-old said he could not imagine an Egypt-like revolt in the short term. "But in the long term, I believe it can happen," he added. "The military is still strong and many of the soldiers are unwilling to turn to the side of the people. But, in time, they might get tired of beating the people.
"I really look forward to it. As your friends are beaten and arrested, the professionals need to come out and organise the people."
Red Cross official Richard Nataka said more than 100 injured people had been taken to five centres, including 78 , of whom 10 had gunshot wounds, at the Mulago Hospital.
He said one person had died and a pickup truck brought in a second body shortly afterwards. Red Cross vehicles were arriving at the Mulago Hospital every few minutes with more casualties.
Besigye has held five "walk to work" demonstrations against rising prices and what he calls a corrupt government. On Friday, demonstrators carried posters praising Besigye, and asked why police needed to use violence to arrest him.
Besigye has been released on bail, but is said to be in poor health and still unable to see after pepper spray was fired into his eyes.
David Smith in Kampala guardian.co.uk,
Protesters burn tyres and wood in Kampala after the riots, where army troops and police faced off against demonstrators in the capital for the first time. Photograph: Stephen Wandera/AP
Riots have swept across the Ugandan capital, Kampala, as protesters called for an Egyptian-style uprising against their autocratic president.
At least two people were killed and more than 100 wounded after soldiers fired live bullets and tear gas and beat demonstrators with sticks. Civilians fought back, blocking roads with burning tyres and pelting vehicles with rocks.
The growing unrest – sparked by rising food and fuel prices – gained fresh impetus after the brutal arrest of opposition leader Kizza Besigye on Thursday.
But President Yoweri Museveni, who was been in control for a quarter of a century, has met the protests with a show of force.
His military police were accused of attacking innocent spectators on Friday. One victim could be seen lying in a pool of blood, apparently after being shot in the head at a local market.
In the Karwerwe neighbourhood, police chased a teenager, Andrew Kibwka, with heavy wooden sticks and rained blows on him.
"I thought the police were going to kill me," he said minutes later, his arm bruised and a finger bleeding. "I was telling them I'm harmless, but they just carried on. I did nothing to provoke them. They beat me because I was running away."
The 18-year-old added: "I'm in pain all over my body. The police are being too brutal. I think Uganda will get worse if the president does not resign."
A minibus, a taxi and other vehicles that tried to travel up the street were pelted with stones. Then soldiers in armoured vehicles appeared and fired tear gas to disperse the crowd, and people ran away in panic.
Standing at a market, Robert Mayanja, who described himself as an activist, said: "What they are doing now shows that Museveni rigged the last election.
"If you look at Uganda, why should we vote for him after 25 years? We have high prices, we have hospitals without medicine. Is there anything to vote for?"
Mayanja, 31, said a repeat of the revolts in Egypt and Tunisia was "definitely" possible. "What we are seeing here are people who are not armed but are taking a stand against armed forces," he added. "People are ready. It's just a question of time.
"We know they are going to arrest many people and put them in torture chambers. We know this regime has expired. These are the signs."
Eric Mbiro, a 20-year-old student, agreed: "We are tired of this government because of the price of commodities," he said. "There is no presidency in Uganda. The president rules the country like his own home. He is a dictator. We need change."
But he was more sceptical about the prospects for an uprising, saying: "We will not manage to do what they did in Egypt because people here are poor. There is too much poverty in Uganda."
Military police fired live rounds, rubber bullets and tear gas at numerous burning barricades blocking the main road out of Kampala to the international airport in Entebbe and sprayed adjacent residential areas with bullets.
Shell casings littered the main road, tear gas hung in the air and security forces beat local residents.
In Ntinda, angry youths shouted and hurled stones and chunks of concrete at passing cars. On one corner, a man ran up to a council vehicle as it drove by and smashed the driver's window with a rock, raising cheers from onlookers.
A coded sign language is already in place. Motorists who hold two fingers aloft in a "v for victory" symbol, showing they support the rebellion, are allowed to pass unharmed, but a single raised thumb is interpreted as a pro-Museveni gesture.
Roads were blocked by rocks, cones, debris and burning tyres. A bare-chested man lay face down on the grass, his head being bandaged by Red Cross medics.
An eyewitness said the man had been the victim of an unprovoked attack. "The military police were making people clear the road, and this boy worked for 30 minutes," Timothy Ssenfuma, a 35-year-old electrical engineer, said. "He said he wanted to go, but they beat him on the head and back until he collapsed. They were also beating up even women and young ladies just to clear the road.
"They are killing innocent Ugandans who are not even involved in the uprising. We appeal to the rest of the world to help Ugandans as they have in Libya and elsewhere."
A teacher, who gave his name only as Nixon, claimed the security forces had launched an indiscriminate attack, saying: "The military police came and started beating up people.
"Some had to run away and others had to fight back to defend their friends. People have terrible anger at the way they were treated."
The 32-year-old said he could not imagine an Egypt-like revolt in the short term. "But in the long term, I believe it can happen," he added. "The military is still strong and many of the soldiers are unwilling to turn to the side of the people. But, in time, they might get tired of beating the people.
"I really look forward to it. As your friends are beaten and arrested, the professionals need to come out and organise the people."
Red Cross official Richard Nataka said more than 100 injured people had been taken to five centres, including 78 , of whom 10 had gunshot wounds, at the Mulago Hospital.
He said one person had died and a pickup truck brought in a second body shortly afterwards. Red Cross vehicles were arriving at the Mulago Hospital every few minutes with more casualties.
Besigye has held five "walk to work" demonstrations against rising prices and what he calls a corrupt government. On Friday, demonstrators carried posters praising Besigye, and asked why police needed to use violence to arrest him.
Besigye has been released on bail, but is said to be in poor health and still unable to see after pepper spray was fired into his eyes.
Thursday, April 28, 2011
Oil companies are making more money and less fuel
Refiners including Exxon Mobil are raking in profits while producing less gasoline and diesel in the U.S. than usual for this time of year. They're also exporting more to foreign countries. With oil prices rising, that makes for sticker shock at the pump.
Valero Energy, the nation’s biggest independent oil refiner, had “record exports coming from the United States” during the last three months of 2010, Chief Executive Bill Klesse recently told investors and analysts. Above, Valero's Wilmington refinery in October. (Christina House, For The Times / April 29, 2011)
http://www.latimes.com/business/la-fi-oil-refineries-20110429,0,7502154.story
By Ronald D. White, Los Angeles Times
Gasoline prices are skyrocketing — and so are oil company profits.
Exxon Mobil Corp. earned nearly $11 billion in the first three months of the year, a rollicking 69% increase over its performance for the same period last year. That's on sales of $114 billion.
It's the same story for the other big oil companies. Royal Dutch Shell turned a profit of $6.3 billion in the first quarter, and BP — despite lingering costs from the Gulf Coast oil spill — made $7.1 billion.
What they aren't making is fuel, at least not in normal quantities. And that's a key factor in their reinvigorated financial performance.
Despite increasing demand, refiners are producing less gasoline and diesel in the U.S. than usual for this time of year. They're also exporting more to foreign countries.
Add rising oil prices, and you get the kind of sticker shock at the gas pump that some analysts say could challenge 2008's all-time highs — with regular gas already averaging about $3.88 a gallon in the U.S. and $4.22 in California, more than a month before the summer driving season kicks in.
Motorists and consumer advocates are outraged at high pump prices and say refineries need to increase gasoline supplies to reduce fuel costs.
"This is a page torn right out of the handbook of gouge-onomics," said Charles Langley, senior gasoline analyst at the Utility Consumers' Action Network in San Diego. "We call it the law of supply and demand: They supply less product and demand more money for it."
Oil makes up about two-thirds of the cost of a gallon of gas, so expensive oil always turns into expensive fuel. But as for-profit entities, refiners use a variety of means to ensure that they keep as much of that windfall as possible.
The nation's refineries are operating at about 81% of their production capacity, Energy Department statistics show. That compares with a 20-year historic average of about 89% for this time of year, according to department records.
Part of that can be explained by the increasing use of ethanol, usually made from corn, which is added after gasoline is refined. Ethanol boosts fuel supply without increasing petroleum consumption just as adding crackers to meatloaf makes more dinner with less beef.
A bigger factor, some experts say, is refiners' business strategy: Having only recently returned to strong profits and leery of potential erosion in consumption, the companies are playing it cautiously.
"They aren't going to try to match production to demand. You aren't going to see anyone running full out right now," said Brian L. Milne, refined-fuels editor for Telvent DTN, which provides commodity price information to businesses.
And here's another piece to the fuel-price puzzle: Refiners are exporting large amounts of gasoline and diesel to foreign buyers willing to pay a premium. Demand for refined products such as gasoline is expected to go back into decline in the U.S. by the end of 2011 because of increased use of alternative fuels, among other things, so refinery companies are looking to broaden their reach with new customers overseas, particularly with diesel fuel.
"U.S. refineries have been sending 15% to 20% of their production overseas for about a year now," said Andrew Lipow, president of consulting firm Lipow Oil Associates in Houston. "Demand for diesel is strong in Central America and South America and Europe and other parts of the world." That's more than double the rate of exports in 2007, he said.
Valero Energy Corp., the nation's biggest independent oil refiner, had "record exports coming from the United States" during the last three months of 2010, Chief Executive Bill Klesse recently told investors and analysts. The San Antonio company's export pace declined somewhat this year because of refinery maintenance.
"We send diesel fuel to South America. We've been sending gasoline to Latin American countries. So there's a lot of change that's happened in this business," Klesse said. In the first quarter, Valero earned $98 million, reversing a year-earlier loss of $113 million.
Energy companies say fuel prices are determined by supply, demand and competition, and that the main culprit for the current run-up is crude prices, which rose more than 30% in the last year because of conflicts in North Africa and the Middle East as well as strengthening world economies.
The American Petroleum Institute, the oil company trade group, said its own statistics showed that refiners are doing their job, delivering 4% more gasoline in the first quarter than in the same period last year.
"We are moving more product than last year and supporting the economic recovery," said Rayola Dougher, the group's senior economic advisor. "The refinery sector is more than keeping pace with that."
At the same time, Energy Department data show a drawdown of more than 18 million barrels in the nation's gasoline stocks this year to 205.6 million barrels, including a drop of 2.5 million barrels in the most recent week.
Valero spokesman Bill Day said production levels are a straightforward matter of supply and demand, and currently U.S. demand is constrained by the pace of the economic recovery.
"Demand in the U.S. is beginning to recover, but it's not recovering strongly," Day said.
This year, oil prices have been on a tear much as in 2008, boosting oil company profits and fuel prices. That was when retail gasoline reached a record average of $4.114 a gallon nationally and $4.588 in California. Averages this month have been higher than for any April since the Energy Department began tracking weekly fuel data in 1990.
The refinery industry "has made a comeback, absolutely," said Fadel Gheit, senior energy analyst for Oppenheimer & Co., noting that refining stocks gained 50% last year and have since maintained a similar trajectory.
But refinery profits can be precarious, he said, and may be squeezed if consumers balk at paying high fuel prices.
"This is not a golden age for refining," Gheit said. "This will come to an end."
As recently as 2007, industry executives thought that they were in such a golden age, when U.S. demand looked to be on a constantly rising curve. But after 2008's record fuel prices and the recession reduced fuel consumption, energy companies changed their tactics.
They are shedding capacity in the U.S. through refinery sales. Investments in their U.S. refineries are geared around equipment upgrades, not expansion. And when they do talk about increasing production to meet rising demand, they mean overseas, not in the U.S., and they mean making more diesel, not gasoline.
"These companies see their future earnings growth overseas, not in the U.S., where demand is still rather flat," Lipow said.
For motorists, the proof is at the pump.
Los Angeles resident James Fong said he was bothered by growing oil company earnings even though he owns two of the most fuel-efficient cars around: a 2001 Honda Insight and a 2010 Toyota Prius.
"I look at other people and see that they are only getting half a tank of gas because that is all they can afford," said the 54-year-old AT&T systems technician. "It's not good for us, but they are going to do whatever they can to make the money."
"I wish," Fong said, "I was in the oil business."
ron.white@latimes.com
http://www.latimes.com/business/la-fi-oil-refineries-20110429,0,7502154.story
By Ronald D. White, Los Angeles Times
Gasoline prices are skyrocketing — and so are oil company profits.
Exxon Mobil Corp. earned nearly $11 billion in the first three months of the year, a rollicking 69% increase over its performance for the same period last year. That's on sales of $114 billion.
It's the same story for the other big oil companies. Royal Dutch Shell turned a profit of $6.3 billion in the first quarter, and BP — despite lingering costs from the Gulf Coast oil spill — made $7.1 billion.
What they aren't making is fuel, at least not in normal quantities. And that's a key factor in their reinvigorated financial performance.
Despite increasing demand, refiners are producing less gasoline and diesel in the U.S. than usual for this time of year. They're also exporting more to foreign countries.
Add rising oil prices, and you get the kind of sticker shock at the gas pump that some analysts say could challenge 2008's all-time highs — with regular gas already averaging about $3.88 a gallon in the U.S. and $4.22 in California, more than a month before the summer driving season kicks in.
Motorists and consumer advocates are outraged at high pump prices and say refineries need to increase gasoline supplies to reduce fuel costs.
"This is a page torn right out of the handbook of gouge-onomics," said Charles Langley, senior gasoline analyst at the Utility Consumers' Action Network in San Diego. "We call it the law of supply and demand: They supply less product and demand more money for it."
Oil makes up about two-thirds of the cost of a gallon of gas, so expensive oil always turns into expensive fuel. But as for-profit entities, refiners use a variety of means to ensure that they keep as much of that windfall as possible.
The nation's refineries are operating at about 81% of their production capacity, Energy Department statistics show. That compares with a 20-year historic average of about 89% for this time of year, according to department records.
Part of that can be explained by the increasing use of ethanol, usually made from corn, which is added after gasoline is refined. Ethanol boosts fuel supply without increasing petroleum consumption just as adding crackers to meatloaf makes more dinner with less beef.
A bigger factor, some experts say, is refiners' business strategy: Having only recently returned to strong profits and leery of potential erosion in consumption, the companies are playing it cautiously.
"They aren't going to try to match production to demand. You aren't going to see anyone running full out right now," said Brian L. Milne, refined-fuels editor for Telvent DTN, which provides commodity price information to businesses.
And here's another piece to the fuel-price puzzle: Refiners are exporting large amounts of gasoline and diesel to foreign buyers willing to pay a premium. Demand for refined products such as gasoline is expected to go back into decline in the U.S. by the end of 2011 because of increased use of alternative fuels, among other things, so refinery companies are looking to broaden their reach with new customers overseas, particularly with diesel fuel.
"U.S. refineries have been sending 15% to 20% of their production overseas for about a year now," said Andrew Lipow, president of consulting firm Lipow Oil Associates in Houston. "Demand for diesel is strong in Central America and South America and Europe and other parts of the world." That's more than double the rate of exports in 2007, he said.
Valero Energy Corp., the nation's biggest independent oil refiner, had "record exports coming from the United States" during the last three months of 2010, Chief Executive Bill Klesse recently told investors and analysts. The San Antonio company's export pace declined somewhat this year because of refinery maintenance.
"We send diesel fuel to South America. We've been sending gasoline to Latin American countries. So there's a lot of change that's happened in this business," Klesse said. In the first quarter, Valero earned $98 million, reversing a year-earlier loss of $113 million.
Energy companies say fuel prices are determined by supply, demand and competition, and that the main culprit for the current run-up is crude prices, which rose more than 30% in the last year because of conflicts in North Africa and the Middle East as well as strengthening world economies.
The American Petroleum Institute, the oil company trade group, said its own statistics showed that refiners are doing their job, delivering 4% more gasoline in the first quarter than in the same period last year.
"We are moving more product than last year and supporting the economic recovery," said Rayola Dougher, the group's senior economic advisor. "The refinery sector is more than keeping pace with that."
At the same time, Energy Department data show a drawdown of more than 18 million barrels in the nation's gasoline stocks this year to 205.6 million barrels, including a drop of 2.5 million barrels in the most recent week.
Valero spokesman Bill Day said production levels are a straightforward matter of supply and demand, and currently U.S. demand is constrained by the pace of the economic recovery.
"Demand in the U.S. is beginning to recover, but it's not recovering strongly," Day said.
This year, oil prices have been on a tear much as in 2008, boosting oil company profits and fuel prices. That was when retail gasoline reached a record average of $4.114 a gallon nationally and $4.588 in California. Averages this month have been higher than for any April since the Energy Department began tracking weekly fuel data in 1990.
The refinery industry "has made a comeback, absolutely," said Fadel Gheit, senior energy analyst for Oppenheimer & Co., noting that refining stocks gained 50% last year and have since maintained a similar trajectory.
But refinery profits can be precarious, he said, and may be squeezed if consumers balk at paying high fuel prices.
"This is not a golden age for refining," Gheit said. "This will come to an end."
As recently as 2007, industry executives thought that they were in such a golden age, when U.S. demand looked to be on a constantly rising curve. But after 2008's record fuel prices and the recession reduced fuel consumption, energy companies changed their tactics.
They are shedding capacity in the U.S. through refinery sales. Investments in their U.S. refineries are geared around equipment upgrades, not expansion. And when they do talk about increasing production to meet rising demand, they mean overseas, not in the U.S., and they mean making more diesel, not gasoline.
"These companies see their future earnings growth overseas, not in the U.S., where demand is still rather flat," Lipow said.
For motorists, the proof is at the pump.
Los Angeles resident James Fong said he was bothered by growing oil company earnings even though he owns two of the most fuel-efficient cars around: a 2001 Honda Insight and a 2010 Toyota Prius.
"I look at other people and see that they are only getting half a tank of gas because that is all they can afford," said the 54-year-old AT&T systems technician. "It's not good for us, but they are going to do whatever they can to make the money."
"I wish," Fong said, "I was in the oil business."
ron.white@latimes.com
Blowout could spill 58 million gallons in Arctic
This undated handout artist rendering provided by the Shell Oil Company shows a graphic of Shell's Alaska subsea containment system for those water depths.
By DAN JOLING, Associated Press
ANCHORAGE, Alaska – The federal agency overseeing offshore drilling in Alaska says the worst-case scenario for a blowout in the Chukchi Sea lease could result in a spill of more than 58 million gallons of oil into Arctic waters.
That's about a quarter of the Deepwater Horizon spill, which put 206 million gallons of oil into the Gulf of Mexico. But it's far more than Shell Oil — the major leaseholder in waters off Alaska's northwest coast — says it could handle under its current response plan.
When applying for exploratory permits, Shell was required to prepare for a maximum spill of 231,000 gallons per day. The company says its fleet of on-site responders — including boats, barges, skimmers, and a tanker that can hold 21 million gallons of recovered liquids — can handle a spill of 504,000 gallons per day.
But according to the memo prepared by the Alaska office of the Bureau of Ocean Energy Management, Regulation and Enforcement, a worst-case scenario blowout could initially discharge about 2.6 million gallons per day.
Shell has consistently said that the chance of a blowout in the area's relatively shallow waters is minimal.
Shell Alaska spokesman Curtis Smith said Wednesday the company has not seen the agency's spill scenario. Shell would revise its response plan for wells it wants to drill if the agency required different numbers, he said.
"Where the bar is, we stand ready to exceed it," Smith said.
However, Shell does not expect wells of the flow rate listed the worst-case scenario for many years into the project, Smith said.
"We do not currently have plans to drill into deep, high pressure reservoirs," he said.
The company anticipates drilling in 120 to 150 feet of water to depths of up to 10,000 feet. The Deepwater Horizon rig operated about a mile below the water surface and drilled nearly 3.5 miles below the ocean floor.
The discharge at the hypothetical well in the report would decline rapidly as the oil reservoir depressurized and fall to about 790,000 gallons per day after a month, according to the report from the agency formerly known as the Minerals Management Service.
But the cumulative discharge over the quickest period estimated for drilling a relief well — a span of 39 days — would mean a discharge of 58.1 million gallons into environmentally sensitive Arctic waters.
Shell says it can deploy a containment system within two weeks, including a cap for a subsea blowout and a containment dome. Company officials also have continuously said Shell would ramp up spill response capability as exploratory wells progress into production.
Environmental groups opposed to drilling say the federal agency's hypothetical well blowout must be taken seriously.
"It's not entirely hypothetical because it's in the lease area," said Lois Epstein of The Wilderness Society in Anchorage. "And we don't have information about where exactly Shell is planning to drill in the Chukchi, nor do we have their own modeling information, which needs to be verified."
Shell has spent more than $3.5 billion in Alaska outer continental shelf drilling, including $2.1 billion for leases in the Chukchi Sea in a 2008 lease sale, but has little to show for it because of court challenges or failure to obtain permits.
The company in February dropped plans for exploratory drilling in the Beaufort Sea off Alaska's north coast during the short open water season this year after an Environmental Protection Agency review board granted an appeal of Shell's air permit.
More than air quality, however, is the fear of that a spill could damage marine waters and the people and animals that depend on them. Environmental groups have said federal agencies have routinely granted permits for seismic tests and other spinoffs of industrial activity that could be harmful to whales, polar bears, walrus and seals already stressed by climate warming and less sea ice.
Critics also claim federal agencies routinely accepted oil company claims that the chance of a catastrophic spill in Arctic waters is minimal.
The Minerals Management Service, already the target of lawsuits for its decisions in the Arctic, was reorganized and renamed after the Deepwater Horizon disaster.
In one of those lawsuits, U.S. District Court Judge Ralph Beistline of Anchorage in July ruled that the federal government failed to follow environmental law before it sold leases in the Chukchi in 2008.
Ocean Energy Management officials in March announced that as part of the court-ordered environmental review, they would study how a "very large oil spill" would affect the Chukchi. They also emphasized that calculation of a "very large oil spill" differs from "worst case discharge" at a specific well site picked by an oil company. The improbability of a discharge was not considered in the analysis.
Epstein said the worst-case scenario information should make people realize a large spill could occur.
"Even in shallow water conditions you can have a spill that is in the same volume range as the Deepwater Horizon range," she said. "Not exactly the same but very close initially, and overall, depending on how many days it goes on, it could be of the same scale."
Smith said the company is confident it would not see high pressure and flow rates from initial exploratory wells because of the geologic data it collected during drilling in the Chukchi and Beaufort in the 1980s and 1990s.
"Wells that would encounter that kind of discharge are much deeper and typically would come later in a production scenario," Smith said.
South Africa photographer honored for Soweto photo
South African photographer, Sam Nzima, poses with his iconic photo showing Hector Pieterson, a 13-year-old shot by police during the 1976 Soweto uprising, in Pretoria, South Africa Wednesday, April 27, 2011. Nzima is being honored for helping expose apartheid's brutality to the world with the picture that ended his career because police were so enraged by the attention his photograph drew
http://news.yahoo.com/s/ap/20110427/ap_on_en_ot/af_south_africa_uprising_photo_2 By DONNA BRYSON, Associated Press
PRETORIA, South Africa – A South African photographer is being honored for helping expose apartheid's brutality to the world with a picture that ended his career.
On Wednesday, celebrated as Freedom Day in South Africa because it is the anniversary of the country's first all-race elections, President Jacob Zuma will bestow national honors on Sam Nzima for a photograph reminiscent of the "Pieta" he took showing a dying Hector Pieterson, a 13-year-old shot by police during the June 16, 1976 Soweto uprising.
Nzima is receiving the Order of Ikhamanga, which recognizes South Africans who excel in arts, culture, literature, music, journalism and sport. He joins such past winners as jazz legend Hugh Masekela and novelist Alan Paton.
Nzima said in an interview Wednesday his photograph seen around the world "tells the story of what happened. You don't even need a caption to see that something terrible has happened."
Nzima, 75, said police were so enraged by the attention his photograph drew, he feared they would kill him. He left Johannesburg and his newspaper to become a businessman in a small eastern South African town.
But his photograph continued to draw attention. Nzima has spoken to students at a German high school named for Pieterson, and attended exhibitions that included his photograph in the United States, Briton and the Netherlands. Later this year, he will go to Belgium.
Pieterson was the first to die from police gunfire after Soweto students were ordered to disperse. The students were protesting an order that black students to be taught in Afrikaans, the language of the white-minority rulers.
Hundreds of blacks, many of them young people, were killed in ensuing clashes nationwide. Conflict escalated in the 1980s and finally led to apartheid's demise in the early 1990s.
Nzima said he arrived in Soweto early that morning in 1976, assigned to cover what he thought would be peaceful protests. He watched students paint signs.
"One said, "Afrikaans must be abolished.' Another, `We are being fed the crumbs of education,'" Nzima recalled.
The marchers were confronted by a white police officer who told them he would shoot if they did not disperse, Nzima said. Instead, Nzima said, they began singing, "Nkosi Sikelel' iAfrika ," or "God Bless Africa."
"That song, which is the national anthem today, was banned then," Nzima said.
The police began shooting, and Nzima saw a boy fall. A tall boy picked him and began to run. Nzima took six pictures as the boy was taken to the nearest car, driven by a colleague from his newspaper, and taken to a clinic. There, he was pronounced dead and identified as Pieterson.
Nzima, working at a time when restrictions on reporting on conflict were draconian, removed the film and hid it in his sock. Later, police forced him to expose film in his camera, but the photos of Pieterson were safe.
"A lot of people ask me, why didn't I help Hector Pieterson?" Nzima said. "It was not my duty. A journalist must do his job. My job is to take pictures."
And this picture, he said, made a difference.
"This picture was an eye-opener for the whole world."
Nigerian oil exports to hit six-month high in June
* Nigeria to export about 2.15 million bpd crude oil in June
* Highest exports since December, provisional data show
* Up from 2.03-2.06 million bpd in April and May
* More cargoes of benchmark Bonny Light, Forcados, Agbami
By Emma Farge and Christopher Johnson
LONDON,(Reuters) - Nigeria will export the highest volume of crude oil for six months in June as its oil industry benefits from strong demand, a period of relative calm and fewer attacks on pipelines and other infrastructure.
Total Nigerian crude exports were expected to be around 2.15 million barrels per day (bpd) in June, up from 2.03 million bpd due in May and 2.06 million bpd sold in April, according to trade estimates based on provisional loading programmes.
The increase would take sales from Nigeria, Africa's biggest oil exporter and a member of the Organization of the Petroleum Exporting Countries, back to levels not seen since December when just over 2.15 million bpd was exported.
The higher export volumes reflect an increase in the number of cargoes loading with benchmark Bonny Light, as well as extra cargoes of Forcados and the ultra-light crude oil, Agbami, the loading schedules show.
Bonny Light is a high quality crude oil grade with a good yield of light products such as gasoline, and is much sought after by oil refiners because of its very low content of polluting sulphur compounds.
Seven Bonny Light cargoes will load almost 222,000 bpd in June, up from six cargoes loading an average of around 184,000 bpd in May, trade sources say.
LIBYAN REPLACEMENT
Like many other Nigerian crude oil grades, Bonny light is considered a good replacement for Libyan crude oil that has been largely absent from the world oil spot market over the last couple of months due to the fighting in the country.
Seven cargoes of Forcados will also load in June, up from six in May, while eight Agbami cargoes will sail, up from six scheduled for May.
Nigerian crude oil volumes in May were also lower due to less availability of the EA and Amenam grades, shipping lists show. In February and March, maintenance at several key oilfields kept exports below 2 million bpd.
Traders said the higher volume of exports in June reflected both higher demand for Nigerian crudes in the absence of significant Libyan exports, and also less disruption of the onshore oil industry in recent months.
Attacks by militants in the oil-rich Niger Delta have restricted production over the last few years but a reduction in political tension has led to fewer attacks this year.
Extra demand helped push premiums for Bonny Light and the other Nigerian benchmark, Qua Iboe, over North Sea dated Brent to two-and-a-half year highs near $4.50 last month and trade sources expect it to remain strong with European refineries returning from seasonal maintenance.
As an OPEC member, Nigeria has an oil production target of 1.67 million bpd but has not been inside that level for almost two years, trade and industry figures show.
State producer Nigerian National Petroleum Corp. (NNPC) has said it is within its OPEC output target and its combined crude and condensate production is around 2.4 million bpd. It has given no breakdown or details. (Editing by William Hardy)
Libya: Nato strike 'kills rebels' in Misrata
At least 11 rebel fighters have been killed in a Nato air strike in the besieged Libyan port city of Misrata, say reports.
A rebel commander and witnesses told reporters a Nato warplane had carried out Wednesday's bombing, but Nato refused to confirm or deny the reports.
A doctor told Reuters news agency seven rebels had also been killed in fire from government forces.
There has been intense fighting over Misrata's strategically crucial port.
Rebel fighters, backed by Nato air strikes, claim they have driven back soldiers loyal to Libyan leader Col Muammar Gaddafi.
The port is a vital lifeline, permitting aid deliveries and refugee evacuations, but they have been interrupted by the fighting - prompting residents to warn that supplies of food and water are dwindling.
Rebel 'reluctance'
For some two months, Misrata has been besieged by Col Gaddafi's forces, and rights groups say hundreds of civilians have been killed in the crossfire.
Rebels desperate to hold the city have appealed for Nato to step up its air strikes, but reports suggest a strike on Wednesday afternoon went astray with fatal consequences.
Survivors quoted by US broadcaster CNN said 11 fighters had been killed and two injured in the strike on the coast, while a rebel commander, Abdullah Mohammed, told the New York Times 12 had died and five had been injured in apparently the same attack.
Mr Mohammed said rebels had at first been reluctant to confirm Nato's deadly mistake, out of fear it would discourage Nato from mounting further strikes.
He said Wednesday's strike was an accident that could have been avoided, but added: "We hope this does not delay strikes on our enemy."
A Nato official who spoke on condition of anonymity told the BBC it was aware of the reports and was looking into them but at this stage could not confirm or deny the strike.
Earlier this month several rebel fighters died in a mistaken Nato air raid on the eastern city of Ajdabiya.
Meanwhile, an unnamed doctor told Reuters seven rebel fighters had been killed and four injured when they were hit by artillery fire and rockets from pro-Gaddafi forces at a checkpoint near the front line.
EU appeal
Injured Libyans were among those hastily evacuated out of Misrata when an aid ship was able to dock In recent days fighting over Misrata port has intensified and rebels say on Tuesday pro-Gaddafi forces fired Russian-made Grad rockets, which rights groups say should not be used in civilian areas.
The Libyan government denies indiscriminately shelling civilian areas.
The EU commissioner for humanitarian relief, Kristalina Georgieva, warned she had received reports "of hospitals being overwhelmed by a growing number of wounded" and appealed for "all sides in this conflict to protect civilians and to allow humanitarian operations in Misrata to resume".
She said fighting near the port had interrupted aid supplies and made it near impossible for civilians and the wounded to be evacuated.
A resident told AP news agency food stocks were dwindling and there was a shortage of drinking water.
But an aid ship, the Red Star, was able to take advantage of a brief lull in the fighting on Wednesday to dock and pick up Libyans and stranded migrant workers.
"Despite heavy shelling of the port area... about 935 migrants and Libyans have been rescued and are now safely en route to [the rebel stronghold of] Benghazi," the International Organisation for Migration (IOM) said.
The fighting was continuing on Thursday, with some rebels quoted as saying they had made significant strides against loyalist forces.
Exxon's qtrly profit soars 69 pct, tops Street
* Production up 10 pct
* Shares slightly lower
* Chemical profit helps fuel beat-analyst (Adds analyst comment, refining, chemical profits, updates share prices)
By Anna Driver
HOUSTON,(Reuters) - Exxon Mobil Corp's (XOM.N) quarterly profit rose a better-than-expected 69 percent as the world's largest publicly traded oil company benefited from higher crude prices and improved earnings in its chemical and refining businesses.
In the first quarter, the average U.S. oil price CLc1 was $95 per barrel, about 20 percent higher than a year earlier, a factor that has lifted earnings at most oil companies.
Since then, prices have climbed above $100 per barrel in a rally fueled by improved world demand for fuel and unrest in the Middle East and North Africa.
"It looks like chemical was really strong," Phil Weiss, oil analyst at Argus Research, said. "And production came in on the higher side relative to my expectations, especially gas."
Exxon shares were likely not responding to the earnings beat because it was driven by chemicals, which is not the company's primary business, Weiss said.
Shares of Exxon edged slightly lower in premarket trading.
Low natural gas prices and an improvement in global economies have boosted results for chemical companies, while refiners are profited from higher fuel demand.
The Irving, Texas, company reported a first-quarter profit of $10.65 billion, or $2.14 per share, up from $6.3 billion, or $1.33 per share, a year earlier.
Analysts on average had expected Exxon to report a first-quarter profit of $2.07 per share, according to Thomson Reuters I/B/E/S.
Revenue rose 26 percent to $114 billion.
Oil and gas output rose 10 percent to 4.82 million barrels oil equivalent per day.
Profit in Exxon's chemicals unit rose 21 percent to $1.5 billion. Refining profit grew to $1.1 billion, up from $37 million a year earlier.
Shares of Exxon fell slightly to $87.56 in premarket trade from a New York Stock Exchange close of $87.78. (Reporting by Anna Driver in Houston; editing by John Wallace, Dave Zimmerman)
Wednesday, April 27, 2011
Oil Rises a Second Day After U.S. Fuel Stockpiles Fall More Than Forecast
By Ben Sharples
Oil climbed for a second day in New York on speculation fuel demand will increase after the Federal Reserve renewed its pledge to stimulate growth and U.S. gasoline stockpiles fell to the lowest since August 2009.
Futures rose to a 31-month intraday high today after Federal Reserve Chairman Ben S. Bernanke signaled the Fed will maintain its record monetary stimulus. The Energy Department said gasoline inventories fell 2.51 million barrels to 205.6 million last week, declining for the 10th week. They were projected to drop 1 million barrels, according to analysts surveyed by Bloomberg News.
The Fed “said it would complete its latest $600 billion bond-buying program in June as scheduled and it would keep interest rates low for an extended period, which was positive for commodities,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in an e-mailed note today. The Energy Department report “was seen as positive by the market,” he said.
Crude oil for June delivery gained as much as 94 cents, or 0.8 percent, to $113.70 a barrel in electronic trading on the New York Mercantile Exchange, the highest since Sept. 22, 2008. The contract was at $113.54 at 9:29 a.m. Singapore time. Yesterday, it climbed 55 cents, or 0.5 percent, to $112.76. Prices are 37 percent higher than a year earlier.
Brent oil for June settlement increased 66 cents, or 0.5 percent, to $125.79 a barrel on the London-based ICE Futures Europe exchange. Yesterday, it rose 99 cents, or 0.8 percent, to $125.13, the highest close since April 8.
Brent Premium
The European crude benchmark traded at a premium of $12.37 a barrel to U.S. futures yesterday. The difference between front-month contracts in London and New York surged to a record $19.54 on Feb. 21. The spread averaged 76 cents last year.
Oil climbed after the Federal Reserve renewed its pledge to stimulate growth with low interest rates and said a pickup in inflation is likely to be temporary. The Fed announcement bolstered equities and sent the dollar lower.
The Energy Department report showed U.S. stockpiles of distillate fuel, a category that includes heating oil and diesel, declined 1.81 million barrels to 146.5 million last week. Crude supplies in the world’s largest oil-consuming nation climbed 6.16 million barrels, the report showed.
Oil has advanced 24 percent in New York this year. Unrest in the Middle East and North Africa has toppled leaders in Egypt and Tunisia and spread to Libya, Algeria, Bahrain, Iran, Oman, Syria and Yemen.
Gasoline for May delivery rose for a sixth day, gaining 3.06 cents to $3.45 a gallon on the New York Mercantile Exchange. The record was $3.571 on July 3, 2008.
To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net
To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net.
Exelon near $7.7 billion deal for Constellation: sources
By Michael Erman
NEW YORK (Reuters) - U.S. power company Exelon Corp (EXC.N) is near a $7.7 billion stock deal to buy rival Constellation Energy Group Inc (CEG.N), the latest in a series of power deals in the consolidating utility industry, sources familiar with the matter said on Wednesday.
Under the terms of the deal, which could be announced as early as Thursday, Constellation shareholders would receive 0.93 Exelon shares for each Constellation share, two of the sources said.
At Wednesday's close, the bid was worth about $38.59 a share -- a 12.5 percent premium to Constellation's closing share price of $34.30.
Constellation's shares rose 9.3 percent after hours on the buyout talks, after already rising 4.2 percent over the course of the day.
Exelon's market value at the end of trading on Wednesday was nearly $27.5 billion.
On a conference call earlier on Wednesday, Exelon Chief Executive John Rowe declined to comment on the merits of a possible tie-up with Constellation.
But, commenting more broadly, Rowe said, "Consolidation makes sense in this industry and is essential in this industry. We always look and we are as cold-blooded as we can be when it comes down to the economics."
Exelon is one of the largest U.S. utilities and the largest U.S. nuclear power company. The company has the capacity to generate nearly 32,000 megawatts of power and serves approximately 5.4 million customers in northern Illinois and southern Pennsylvania.
Constellation owns 12,000 megawatts of generating capacity and serves more than 1.2 million customers through its Baltimore Gas & Electric utility. It holds just more than half of a joint venture with France's EDF (EDF.PA) that owns five nuclear reactors.
Both companies have significant unregulated businesses, and derive most of their earnings from these operations.
The deal follows a number of large deals in the U.S. utility industry, including Duke Energy's (DUK.N) $13.7 billion deal for Progress Energy (PGN.N), Northeast Utilities (NU.N) $4.2 billion takeover of NSTAR (NST.N), and AES Corp's (AES.N) $3.5 billion bid for DPL Inc (DPL.N).
Exelon spokesman Paul Elsberg said the company was always looking for opportunities to enhance shareholder value, including mergers and acquisitions. He said the company does not comment on rumors about specific deals.
A Constellation spokesman also declined to comment.
Utility deals in the United States are drawn-out procedures which face tough scrutiny from states and regulators.
Both companies have had high-profile deal failures in the past. Exelon walked away from a $7.7 billion hostile bid for independent power producer NRG Energy Inc (NRG.N) in 2009 and couldn't get a deal for Public Service Enterprise Group past regulators in 2006.
Florida power company FPL Group Inc scrapped a $12.5 billion takeover of Constellation in 2006 after the merger became embroiled in state politics.
Constellation also came close to selling itself to Berkshire Hathaway's (BRKa.N) MidAmerican Energy Holdings Co at the height of the financial crisis in late 2008 for $4.7 billion.
But that deal fell through as Constellation instead agreed to sell nearly half of its nuclear power business to Electricite de France SA (EDF.PA) for $4.5 billion.
Warren Buffett's one-time lieutenant David Sokol was a key figure in pursuing the Constellation deal for the billionaire investor, according to a regulatory filing.
Sokol left Berkshire in March after he bought shares in Lubrizol Corp (LZ.N) before suggesting to Buffett that he buy the company. On Wednesday, Berkshire's audit committee said Sokol had intended to deceive the company and violated Delaware law.
(Additional reporting by Matt Daily and Megan Davies; Editing by Gary Hill, Phil Berlowitz)
Fed signals $600B bond program to end in June
By JEANNINE AVERSA, AP Economics
WASHINGTON – The economy and job creation have strengthened enough for the Federal Reserve to end its $600 billion Treasury bond-buying program in June as planned, the Fed signaled Wednesday.
Ending a two-day meeting, the Fed made no changes to the program. The decision was unanimous. The bond purchases were intended to lower loan rates, encouraging spending and boost stock prices. But critics worried that the purchases would feed inflation.
The Fed downplayed inflation risks. It acknowledged a spike in oil prices, but concluded that the pickup in inflation will be temporary.
As it winds down its economic support programs, the Fed is shifting its focus on when and how it should start boosting interest rates to prevent inflation from getting out of control. Economists think the Fed will start raising rates later this year or early next year. Higher rates would reduce borrowing and spending and make companies less inclined to boost prices.
The Fed offered a mostly upbeat assessment on the economy. It said that the economic recovery is proceeding at a "moderate pace" and hiring is improving gradually. Consumers and businesses also are spending enough to support the recovery, the Fed said.
But the Fed's statement also pointed to weak spots in the economy. It noted that the housing market remains "depressed."
To nurture the recovery, the Fed also kept a pledge to hold its key interest rate at a record low near zero for an "extended period." The Fed has kept rates at ultra-low levels since December 2008.
Even though the bond-buying program is scheduled to end in June, the Fed said it's continuing a separate support program: It's reinvesting about $17 billion a month in proceeds from its portfolio of mortgage securities to buy Treasury debt. That should help keep rates low on mortgages and other consumer loans.
Since the Fed's bond-purchase program was announced in early November, the economy has gained strength. The unemployment rate has dropped to 8.8 percent, a full percentage point. Companies have added more than 200,000 jobs for two straight months — the first time that's happened in five years. And the S&P 500 index has surged 28 percent over the past eight months. Rates on 30-year mortgages have dropped and now stand at 4.80 percent.
Trump Declares Victory on Certificate, Slams OPEC, Press
By Jim Meyers
Responding to the release of President Barack Obama’s birth certificate, Donald Trump ran a victory lap during an impromptu press conference in Portsmouth, N.H. Wednesday morning.
Trump, who had consistently called on Obama to release his full birth certificate, said he is “honored to play such a big role in hopefully getting rid of this issue. I am really proud. I am really honored. Now let’s get on to the issues.”
Trump criticized Obama, however, for not releasing his birth certificate sooner, as Trump did immediately when asked to.
And he said it is “amazing that all of a sudden” Obama’s birth certificate “materialized.”
Trump also said he would carefully review the document for authenticity.
During his conference with a hostile press, Trump moved away from the birth certificate issue to step up his attacks on the Obama administration for its dealings with China and for soaring oil prices. He slammed OPEC, claiming the cartel’s price fixing is killing the American economy.
He took issue with Obama’s claim that the president can do little to control gasoline prices, and claimed the United States has been overly protective of Saudi Arabia and Kuwait and said those oil kingdom should take steps to lower the price of oil.
Trump slammed the press as well, claiming the media have largely been “very protective” of Obama. And now that Obama has released his birth certificate, Trump called on the president to release his college records and other documents he has so far declined to release.
© Newsmax. All rights reserved.
Nigeria: Gubernatorial Polls Crash Oil Price to U.S.$112
Nigeria voting location
http://allafrica.com/stories/201104270363.htmlAdeola Yusuf / With Agency Reports
Lagos — Oil prices fell to about $112 a barrel on Tuesday as traders looked forward to the outcome of elections into government houses in the Niger Delta and other states in Nigeria.
The fall was buoyed by a Federal Reserve meeting in the United States (U.S), consumer of over 1 million barrels of oil from Nigeria.
The oil rich Niger Delta area of Nigeria had hitherto been plunged by armed struggle and militancy, which were said to be a result of arming of youths and political thugs during the 2003 elections.
Benchmark crude for June delivery was down 20 cents at $112.08 a barrel by midday European time in electronic trading on the New York Mercantile Exchange. The contract lost a penny to settle at $112.28 on Monday.
In London, Brent crude for June delivery was up 21 cents to $123.87 a barrel on the ICE Futures exchange.
Traders are mulling how the Federal Reserve may ease a programme of buying Treasuries known as quantitative easing that has helped keep the U.S. economy flush with cash.
"There can be little doubt that the Federal Reserve's hyper-accommodative monetary policy has caused commodity and asset inflation around the world," said Richard Soultanian of NUS Consulting.
"The likely transition of the Fed's monetary policy, albeit gradual, will begin to remove some of the more speculative fervor from the market, bringing prices slowly down."
A weaker dollar and violent political uprising in the Middle East and North Africa have helped push prices up about 33 percent since mid-February. The euro rose to $1.4620 on Tuesday from $1.4579 late Monday.
Investors are also closely watching escalating violence in Syria. On Monday, thousands of soldiers backed by tanks and snipers attacked suspected anti-government protesters in the southern city of Daraa and other areas, killing at least 11 people.
The crackdown since mid-March has killed more than 350 people throughout the country, with 120 alone dying over the weekend.
"While Syria is not an actual oil producer, it has broader ramifications on other countries in the region and could keep oil well bid in the short term," IG Markets in Melbourne said in a report.
In other Nymex trading in May contracts, heating oil fell 1.0 cent to $3.21 a gallon and gasoline slid 1.0 cent to $3.29 a gallon. Natural gas futures were down 1.0 cent at $4.39 per 1,000 cubic feet.
Tuesday, April 26, 2011
Libya Sours Profit at Mediterranean Oil Refiners: Energy Markets
By Rachel Graham
(Bloomberg) -- The best-quality oil is fetching the highest premium in more than two years, weighing on profits at Mediterranean refiners that depend on Libyan crude.
North Sea Dated Brent, Europe’s benchmark low-sulfur crude, sold for $7.11 a barrel more than Dubai crude, a Middle Eastern high-sulfur oil, on April 11, according to data compiled by Bloomberg. That’s the highest spread since October 2008. Brent’s premium to Iran Heavy crude has doubled from January’s average.
Nine weeks of civil conflict in Libya is crimping supply of lower-sulfur “sweet” crude, which is more easily refined into cleaner-burning fuels, pushing up prices for comparable grades from the North Sea and Nigeria faster than “sour,” high-sulfur blends from Saudi Arabia and Russia. That helps Finland’s Neste Oil Oyj, Hungary’s Mol Nryt. and refiners set up to turn sour crude into fuel for cars or jets, while hurting Mediterranean refiners such as Saras SpA and Hellenic Petroleum SA that can’t easily switch away from low-sulfur grades.
“The ability to process heavy-sour crudes will be a potentially significant source of competitive advantage for refiners this summer,” Daniel Ekstein, a London-based oil and gas analyst at Jefferies International Ltd., said in an April 13 note. “A lot of the Med refineries are configured to run a very particular crude slate, and it’s not straightforward to change that configuration.”
Workers Evacuated
Libya accounted for 8.8 percent of global light, low-sulfur crude supply in 2010, according to JBC Energy GmbH, a Vienna- based consultant. Oil output from the North African OPEC member is down 75 percent as fighting between rebels and government troops forced producers such as Marathon Oil Corp. to evacuate workers.
Prices are rising for low-sulfur grades from Nigeria, Algeria and Azerbaijan, as well as those in the North Sea. Nigerian Qua Iboe’s premium to Brent rose to $4.13 a barrel on March 30, the most since July 2008.
Mediterranean refiners, being closest to Libya, tend to be the most reliant on its crude. Saras, which operates the Sarroch refinery in Sardinia, imported 47 percent of its crude from Libya in 2008, according to its website.
Saras plans to discuss the impact of the Libyan disruption at its general meeting tomorrow, Rafaella Casula, a spokeswoman for the company in Milan, said yesterday. She declined to comment before the meeting.
The Italian company was more reliant on Libya than Repsol YPF SA, Spain’s biggest oil company, which bought 16 percent of its crude from North Africa in 2009, according to its website.
Hellenic’s Oil Supply
Hellenic Petroleum relies on Libya for as much as 12 percent of its supply, John Kostopoulos, chief executive officer, said in February. Athens-based Hellenic may be “competitively disadvantaged” by the rising premium for sweet crude until it finishes a 1.2 billion euro ($1.8 billion) upgrade at its Elefsis plant, Jefferies’ Ekstein said.
“Refineries are designed to process a certain percentage of sweet and sour crudes,” said Christophe Barret, an oil analyst at Credit Agricole CIB. “They have to reassess production if they lose supply, and that can be quite costly.”
Hellenic has had to switch to other sources of light-sweet crude because of lost Libyan supply, a spokesman said from Athens, declining to be identified by name in line with company policy.
Adapting German Refinery
OMV AG, one of the oil producers forced to curb output in Libya, is adapting its Burghausen refinery in southern Germany to process crudes from other countries. Vienna-based OMV ran about 20 percent of its capacity on Libyan oil before the crisis began.
OMV told investors the crisis in Libya will cut earnings before interest and taxes by an estimated 20 percent, Philipp Chladek, an analyst at Raiffeisen Centrobank AG, said in an April 20 note. Sven Pusswald, a spokesman for OMV, declined to comment on profit.
European refiners may find it harder in coming weeks to get suitable crudes as they return from seasonal maintenance, the Paris-based International Energy Agency said in an April 12 report.
“The impact of the lost supplies has so far been muted by the fact that European spring turnarounds hit a seasonal peak in March,” the agency said. Refinery maintenance is mostly timed to allow refiners to maximize production of gasoline in the European summer and heating oil in winter.
Russian Urals Crude
Russian Urals’ discount to Brent in northwest Europe fell to $4.30 a barrel on April 12, compared with a $1.90 discount at the beginning of the year. That helps refiners including Neste Oil, which operates refineries in Naantali and Porvoo in Finland and gets most of its crude from Russia, according to AlphaValue, a Paris-based research company.
“Plants that can handle Russian crude are doing well right now,” Credit Agricole’s Barret said from London. Many refineries in former Eastern bloc countries such as PKN Orlen SA’s Plock facility were designed to handle Russian heavy crude and are still linked by pipelines dating back to Soviet times.
Neste’s stock gained 12 percent this year, compared with a 4 percent advance in Europe’s Stoxx 600 Oil and Gas Index. The company, based in Espoo, Finland, gets 70 percent of its crude from Russia and none from Libya, according to Kaisa Lipponen, a company spokeswoman.
While Saudi Arabia has increased production to offset the drop from Libya, its crude isn’t a good substitute because most of its output is higher in sulfur than Libyan crude. Putting a lesser quality crude through a refinery’s processing units can yield inferior fuels.
Heavy Crude Difficulties
“Some refiners are set up to produce low sulfur gasoline and diesel,” said Jonathan Leitch, a London-based senior analyst at Wood Mackenzie Consultants Ltd. “If you run heavy crudes you’ll have problems. It could mean the refiner can’t meet the market specification.”
Most Saudi crude, including Arab Medium and Arab Extra Light, contains more sulfur than Es Sider, the Libyan benchmark. Saudi’s Extra Light contains 1.16 percent sulfur, compared with a 0.44 percent threshold for Libya’s Es Sider, according to Energy Intelligence Group.
Saudi Arabia developed two new blends with reduced sulfur content in response to the Libyan shortfall. The blends have seen a “lukewarm response” from European refiners, Amrita Sen, an analyst at Barclays Plc, said in an April 14 report.
Tupras Turkiye Petrol Rafinerileri AS, the operator of refineries in Turkey, is buying more Saudi and Iranian crude for its plants, making it one of the beneficiaries of the discount on Middle East grades, Tamas Pletser, an analyst at ING Groep NV, said by phone. “Tupras is a major buyer of sour crudes, so this expanding margin is likely to be replicated in the company’s own margins,” he said.
Tupras gained 26 percent this year on the Istanbul Stock Exchange, outperforming a 4 percent rise on the ISE National 100 Index, Turkey’s benchmark index. Tupras officials in Izmit weren’t available for comment when called yesterday.
--With assistance from Sherry Su in London and Zoe Schneeweiss in Vienna. Editors: Mike Anderson, Stephen Voss
To contact the reporter on this story: Rachel Graham in Belfast at rgraham13@bloomberg.net
To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net
Crude Fluctuates on U.S. Consumer Confidence Report, Saudi Price Concern
By Margot Habiby
Oil fluctuated as U.S. consumer confidence increased more than forecast in April, a sign demand may improve, and after the head of Saudi Arabia’s national oil company said the kingdom isn’t comfortable with current prices.
Crude edged higher after the Conference Board reported its confidence index rose as six straight months of job growth and a two-year low in joblessness helped sustain consumer purchases in March. Khalid al-Falih, chief executive officer of Saudi Arabian Oil Co., said the world’s biggest oil exporter is concerned about the impact of prices on economic growth.
“While the confidence report provided a bump, we’ll have to see if any kind of strength is maintained throughout the day,” said Jason Schenker, president of Prestige Economics, an energy advisory firm in Austin, Texas. “There are so many factors pushing and pulling at this market.”
Oil for June delivery fell 31 cents to $111.97 a barrel at 11:17 a.m. on the New York Mercantile Exchange. Prices have gained 33 percent in the past year. Yesterday, futures touched $113.48, the highest intraday price since Sept. 22, 2008.
Brent crude for June settlement on the London-based ICE Futures Europe exchange climbed 23 cents to $123.89 a barrel.
The Conference Board’s confidence index increased to 65.4 from a revised 63.8 reading in March, figures from the New York- based private research group showed today. The median forecast of economists surveyed by Bloomberg News projected an advance to 64.5. The gain signaled the improving labor market is helping Americans weather rising fuel costs.
U.S. Economy
The Standard & Poor’s 500 Index rose above its highest closing level since June 2008 on positive earnings reports from companies including United Parcel Service Inc., Ford Motor Co. and 3M Co. The index gained 0.8 percent to 1,345.42.
U.S. Treasury Secretary Timothy Geithner said today that oil prices have become an obstacle to economic improvement.
“We’ve got some new headwinds, most prominently of course in oil,” Geithner said today at the Council on Foreign Relations in New York. “What’s happening in oil is obviously potentially very significant. At current levels, on its own, it won’t put the recovery at risk.”
Residential real estate prices dropped by the most in more than a year in February, a sign the U.S. housing market is struggling to stabilize, according to the S&P/Case-Shiller index of property values in 20 cities.
U.S. Airways Group, the smallest of the U.S. full-fare carriers, posted a wider loss in the first quarter as jet fuel prices surged 33 percent, the Tempe, Arizona-based said in a statement today. Coca Cola Co., the world’s largest soft-drink maker, is “pressured” by rising commodity prices, Chief Executive Officer Muhtar Kent said today on a conference call.
Price Impact
“There are more and more stories about the effect of high oil prices on corporate earnings and on people’s summer vacations,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. The Saudi statement “implies they’re not going to step in if prices weaken a bit.”
Earlier, oil declined as much as 1 percent after Aramco’s al-Falih said the world’s biggest oil exporter is concerned about the impact of prices on economic growth.
Saudi Arabia is committed to maintaining 3 million to 4 million barrels a day of idle capacity, al-Falih said in Seoul.
“We are not comfortable with oil prices where they are today,” al-Falih said. “We’re concerned about the impact it could have on global economic growth.”
To contact the reporter on this story: Margot Habiby in Dallas at mhabiby@bloomberg.net.
To contact the editor responsible for this story: Bill Banker at bbanker@bloomberg.net.
Libya opposition: Over 300 Gadhafi troops killed in Misrata
State media says NATA has launched fresh air strikes to weaken Gadhafi forces, as many Libyans fear fighting between rebels and government forces will go on for months.
By DPA
Libyan rebels have killed more than 300 troops loyal to leader Muammar Gadhafi in the western city of Misrata in the past two days, opposition website Libya al-Youm reported on Tuesday.
NATO launched fresh airstrikes to weaken Gadhafi's forces, state media said, as many Libyans have begun to fear that the fighting between rebels and government forces will go on for months.
An estimated 20 Gadhafi loyalists have been captured, among them two army majors - including the second in command of the elite Khamis Gadhafi brigade, Libya al-Youm reported.
There were also civilian casualties, with 12 people killed in Misrata on Monday, and 57 wounded, according to broadcaster Al Jazeera.
On Tuesday, the United Nations said it helped deliver more than 500 tons of food to Misrata, which is the country's third-largest city and a key gateway to the capital city of Tripoli.
Rebel spokesman Abdul Hafiz Ghoga told the German Press Agency dpa by telephone that Gadhafi's forces have not respected the ceasefire that they promised in Misrata.
"The rebels have made good gains in the center of the city but Gadhafi's forces are still on the outskirts. The statement they made regarding a ceasefire there has no truth to it," said Ghoga.
Despite gains made by the rebels in the last few days of fighting, frustrations and fears were coming to the surface among residents in the coastal city of Derna, located between the rebel stronghold of Benghazi and Tobruk town.
"If we don't see progress soon, people will get very frustrated," said Iman El Kuf, who used to work in the tourism industry in Derna.
"There are already pockets of resistance against the rebel movement. After dark, they come out. Perhaps if the rebels do not advance soon, others might join them," she said.
Another resident, Mohamed Founi, complained that many people can't find jobs and that schools were still closed. He said one liter of oil, which was sold for 1.5 Libyan dinars before the revolution now costs up to 3.5 dinars.
NATO said Tuesday that its forces launched attacks a day earlier that struck at a training facility near Misrata, as well as vehicles and tanks in Tripoli. Three ammunition depots were also destroyed in the area around Gadhafi's hometown of Sirte, according to the NATO statement.
Government officials said an attack on the buildings in Gadhafi's Bab Al Aziziya compound was an assassination attempt, something which NATO forces have denied.
Soaring Gas Prices Tank Obama's Approval Rating
http://www.newsy.com/videos/soaring-gas-prices-tank-obama-s-approval-rating
BY ALLIE SPILLYARDS
ANCHOR JIM FLINK
You're watching multisource U.S. news analysis from Newsy
Gas prices are up 45 percent from a year ago, but President Obama’s disapproval rating might be rising even higher.
NBC: “When gas prices go up they hurt any president. We saw it with Bush. We’ve seen it for a long time.”
According to the latest CNN Poll of Polls, Obama’s approval rating is edging steadily downward -- its lowest this year at 45 percent.
The president himself even blames his declining approval rating on skyrocketing prices at the pump. And some in the media are speculating how these new numbers will affect 2012. The National Journal’s James Barnes writes...
“Political Insiders in both parties concurred that the party that controls the presidency in the White House was the one that was going to shoulder disproportionate blame with the public. ‘If you're in the White House they are your gas prices,’ said one Democratic Insider.”
But a blogger for the Independent isn’t so sure.
“...assuming Republicans can come up with a credible candidate. That is, of course, a big ‘if’, when none of the party's likely field has made much of an impression, and when such headlines as exist are dominated by Donald Trump, who is pushing the far-right ‘birther’ argument against Mr Obama.”
And in an editorial for The Boston Herald -- Fox News’ Bill O’Reilly is even more skeptical. He writes...
“In normal times, that kind of poll number would be catastrophic for a president about to enter the re-election season. But these are not normal times. A new Washington Post/ABC News poll says that despite the country’s dour mood, Obama would still beat every single Republican who’s showed any interest in running.”
But the president isn’t taking chances. In an attempt to win back some public affection, the administration recently announced a task force to look into price gouging -- to mixed reviews. The Huffington Post’s Bill Schneider says he doesn’t except it to help much.
“Expect lots of photo ops at gas stations... Government can provide some temporary relief by doing things like releasing oil supplies from the strategic petroleum reserve. That's a short-term solution. But politics is lived in the short-term, and right now, gas prices are taking a toll on all elected officials.”
But gas price drama might be coming to an end soon. According to an industry analyst cited by Reuters, the increases have slowed and could even stop rising in the near future.
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