OPEC oil supply in April has jumped to its highest in more than two years, boosted by record or near-record supplies from Iraq and Saudi Arabia, a Reuters survey showed, as key members stand firm in their focus on market share.

The increase from the Organization of the Petroleum Exporting Countries puts output further above forecasts of demand for OPEC oil in the first half of the year, although second-half demand is expected to be stronger.

OPEC supply has risen in April to 31.04 million barrels per day (bpd) from a revised 30.97 million bpd in March, according to the survey, based on shipping data and information from sources at oil companies, OPEC and consultants.

"We are in an oversupplied market, and this oversupply is unlikely to disappear any time soon," said Eugen Weinberg, analyst at Commerzbank in Frankfurt.

If the total remains unrevised, April's supply would be OPEC's highest since 31.06 million bpd in November 2012, based on Reuters surveys.

Besides Iraq, the main reasons for the rise are higher Nigerian exports and a further small gain in Libyan production despite the unrest there. Top exporter Saudi Arabia has kept output near a record high in April, sources in the survey said.

Iraq has increased its northern exports further following a deal between Baghdad and the Kurdistan Regional Government, offsetting a slight decline in flows from the south which produces the bulk of Iraq's oil.

Based on this survey, Iraqi exports this month look set to exceed March's record high of 2.98 million bpd. Iraq was hoping to reach 3.1 million bpd of exports in April.

OPEC's largest African producer Nigeria has shipped more cargoes in April, helped by a return to a more typical export rate from its largest crude steam, Qua Iboe.

Iran increased exports as some buyers who stayed away in March in response to U.S. pressure during negotiations on a preliminary nuclear deal, resumed purchases in April, sources in the survey said.

There was not a corresponding increase in Iranian production in April, sources said, as the extra barrels were shipped from storage.

Saudi Arabian output dipped after a rise in March to a record high, the survey found, but remained above 10 million bpd due to increased local requirements in power plants.

Saudi Oil Minister Ali al-Naimi said April output was "around" 10 million bpd.

Riyadh was the driving force behind OPEC's refusal last year to prop up prices by cutting its output target of 30 million bpd, in a bid to discourage more costly rival supplies.

Of countries with lower output, the biggest decline was in OPEC's other West African producer, Angola, where outages at BP's Saturno and Plutonio fields contributed to the drop.

http://www.reuters.com/article/2015/04/30/opec-oil-survey-idUSL5N0XQ37G20150430

Saudi Arabia's Supreme Economic Council has approved a restructuring of state oil company Saudi Aramco that includes separating it from the oil ministry, Al Arabiya television channel reported on Friday, citing sources.

There are no indications that the move will lead to changes in the fundamental way the world's top crude exporter makes its oil decisions.

"Saudi Supreme Economic Council agrees on Deputy Crown Prince Mohammed bin Salman's vision of restructuring oil-giant Aramco," Arabiya reported on its Twitter account.

"Restructuring of Saudi Aramco includes separation from petroleum ministry," the channel said.

The Supreme Economic Council is a new body formed by King Salman earlier this year to replace the Supreme Petroleum Council, which used to help set the kingdom's oil policy.

The new council is headed by the king's son Prince Mohammed, a move seen by analysts as laying the ground for a generational shift in how Riyadh develops its energy and economic strategies.

The main tenets of Saudi oil policy, including  maintaining the ability to stabilise markets via an expensive spare-capacity cushion and a reluctance to interfere in the market for political reasons, are set by the top members of the ruling Al Saud family.

On Wednesday, King Salman appointed Saudi Aramco's chief executive as chairman of the state oil firm and health minister, as part of a major reshuffle in the OPEC kingpin.

http://www.reuters.com/article/2015/05/01/saudi-oil-aramco-idUSL5N0XS0BI20150501

Exxon Mobil Corp on Thursday reported a 46 percent decline in quarterly earnings as a steep drop in crude prices cut into profits at the world's largest publicly traded oil company.

First Quarter Highlights

Earnings of $4.9 billion decreased 46 percent from the first quarter of 2014.
Earnings per share were $1.17 assuming dilution, a decrease of 44 percent.
Capital and exploration expenditures were $7.7 billion, down 9 percent from the first quarter of 2014, in line with plan.
Oil-equivalent production increased 2.3 percent from the first quarter of 2014, with liquids up 6 percent and gas down 1.6 percent.
Cash flow from operations and asset sales was $8.5 billion, including proceeds associated with asset sales of $484 million.
The corporation distributed $3.9 billion to shareholders in the first quarter of 2015, including $1 billion in share purchases to reduce shares outstanding.
Dividends per share of $0.69 increased 9.5 percent compared with the first quarter of 2014.
Production started at the Sakhalin-1 project's Arkutun-Dagi field, the last of the three fields to be developed. Peak daily gross production from the field is expected to reach 90,000 barrels and will bring total daily production at Sakhalin-1 to more than 200,000 barrels.
Production started at Hadrian South in the Gulf of Mexico with ExxonMobil's deepest subsea tie-back. Daily gross production is expected to reach approximately 300 million cubic feet of gas and 3,000 barrels of liquids from two wells.
Oil production started ahead of schedule at the Kizomba Satellites Phase 2 project offshore Angola. This capital-efficient project utilizes subsea tie-backs to optimize existing Block 15 facilities, increasing current production levels without requiring additional floating production, storage and offloading vessels. The project develops approximately 190 million barrels of oil with peak production currently estimated at 70,000 gross barrels of oil per day. The project is expected to increase total daily Block 15 production to 350,000 barrels.
Construction of an 84 megawatt cogeneration plant is underway at the Singapore refinery, which will improve the energy efficiency of the site upon completion. The project will enable the shutdown of less efficient power generation facilities and reduce carbon dioxide emissions. This project underscores ExxonMobil's commitment to improving energy efficiency, lowering emissions, and reducing costs.
Drilling resumed at Point Thomson on Alaska's North Slope as construction continues toward bringing the initial production systems, designed to produce up to 10,000 gross barrels per day of natural gas condensate, online in 2016. The initial production will provide reservoir development insights and economic benefits to Alaskans.

http://www.oilvoice.com/n/ExxonMobil-earns-49-billion-in-first-quarter-of-2015/9ecd2a81a147.aspx

ConocoPhillips said Thursday that its earnings fell less than expected in the first quarter, even as the price it got for each barrel of oil plunged nearly 50%.

Shares edged up 0.7% in premarket trading as the company also backed its guidance for the year.

ConocoPhillips was the first big U.S. oil producer to slash its 2015 capital spending to deal with the plunging price of crude. In March, it said it would curb capital spending through 2017 to reflect expectations that commodities prices will remain volatile.

ConocoPhillips has said it would cut back on exploring for new sources of oil and gas, as well as on drilling in some shale formations in North America, including the Niobrara in Colorado.

For the first quarter, ConocoPhillips’ average realized price plunged to $36.96 a barrel from $71.21 a barrel a year ago. Meanwhile, its production level edged up slightly to 1.61 million barrels of oil equivalent a day, excluding Libya.

Overall, ConocoPhillips reported a profit of $272 million, or 22 cents a share, compared with $2.12 billion, or $1.71 a share, a year ago.

Excluding a deferred tax benefit, the company posted a per-share loss of 18 cents, compared with a profit of $1.81 a year ago.

Analysts polled by Thomson Reuters expected a per-share loss of 19 cents.

Operating costs fell to $2.1 billion from $2.3 billion a year ago.

http://www.wsj.com/articles/conocophillips-profit-declines-as-oil-prices-plunge-1430393936

In the biggest write-down in India's corporate history, Anil Agarwal-led Sesa Sterlite, which was renamed asVedanta last week, has been hit hard by falling crude prices as it booked nearly Rs 20,000 crore ($3 billion) as "goodwill impairment charges" related to its oil and gas business. The write-down resulted in the company posting the biggest quarterly loss in the country's corporate history. Vedanta reported a consolidated net loss of Rs 19,228 crore (about $3 billion) for the January-March quarter as against a profit of Rs 1,621 crore in the corresponding quarter last year.

http://timesofindia.indiatimes.com/business/india-business/Vedanta-writes-down-Rs-20k-cr-on-oil-business/articleshow/47102392.cms

Russia's Eurasia Drilling said on Thursday it had agreed to extend a deadline on a proposed deal to sell a stake to international oilfield services firm Schlumberger from to April 30 to May 31.

It said both companies were continuing to cooperate with the Russian Federal Anti-Monopoly Service (FAS) and the Commission on Foreign Investment on the proposed merger.

Last month, Schlumberger said it planned to buy a 45.65 percent stake in Eurasia for about $1.7 billion, potentially paving the way for it to become the sole owner of Russia's most active oilfield services company.

Russian authorities have been concerned about complications that could arise from future international sanctions impeding the activity of investors operating in Russia.

The deal requires approval from the governmental commission.

Eurasia Drilling and FAS declined immediate comment.

http://www.reuters.com/article/2015/04/30/eurasia-schlumberger-delay-idUSL5N0XR1MN20150430

U.S. oil producers are rushing to take advantage of the rebound in oil markets by locking in prices for next year and beyond, safeguarding future supplies and possibly paving the way for a rebound in production.

The flurry of hedging activity in the past month will help sustain producers' revenues even if oil markets tumble again, which is bad news for OPEC nations, such as Saudi Arabia, that are counting on low prices to stunt the rapid rise of U.S. shale and other competitors.

Oil drillers are racing to buy protection for 2016 and 2017 in the form of three-way collars and other options, according to four market sources familiar with the money flows. In some cases, that means guaranteeing a price of no less than $45 a barrel while capping potential revenues at $70.

Implied volatility - a gauge of options prices - tumbled nearly 30 percent this month to a four-month low reflecting increased options selling.

"A lot of producers that have hedges on for 2015 are under-hedged for 2016," said John Saucer, vice president of research and analytics at Mobius Risk Group. The crude's rally from six-year lows plumbed in January and easing option premiums have opened a "great opportunity" to buy extra insurance against a new slump, he said.

Analysts tracking hedging say that U.S. shale producers are protected as much as 50 percent less in 2015 compared with 2014. With new hedges now, producers have found an opportunity to maximize cash flow by selling calls and protecting the downside.

http://www.reuters.com/article/2015/05/01/oil-hedging-idUSL2N0X51HP20150501

Facing falling oil prices and a possible slowdown in oil production, Phillips 66 has shelved plans for two projects aimed at processing the glut of oil unleashed by the U.S. shale boom.

Months after the company applied for a permit to build a new condensate splitter, the project has been placed on the back burner for at least a year until prices recover, company officials said Thursday during an earnings call with investors.

The delay underscores the ongoing ambiguity surrounding the rules regarding exporting condensate, an ultra-light oil unlocked from shale, said Colton Bean of Tudor, Pickering, Holt & Co.

A decades-old ban prevents companies from sending shipments of crude overseas, but in confidential rulings last year, the Commerce Department’s Bureau of Industry and Security said two companies — Enterprise Products Partners and Pioneer Natural Resources — could export condensate after distilling it and separating into various components. Other companies have clamored for more clarity, but the agency has not issued further guidance.

Phillips 66 on Thursday also said it will similarly push back plans for a second fractionator, which separates natural gas liquids into its component parts. The first fractionator, under construction at the company’s Sweeny refinery, is slated to start operations later this year.

The Houston-based refining, pipeline and chemicals company said it remains committed to its slate of projects, including the nearly complete fractionator and a liquid petroleum gas export terminal in Freeport

http://fuelfix.com/blog/2015/04/30/phillips-66-profits-fall-37-percent-as-midstream-chemicals-weaken/

Canada's transport minister will be in Washington on Friday for a joint announcement with her U.S. counterpart aimed at harmonizing safety regulations on shipping crude oil by rail, a politically sensitive issue on both sides of the border.

Lisa Raitt and U.S. Transportation Secretary Anthony Foxx are expected to demand that railroad companies equip cars with electronically controlled pneumatic brakes, a proposal the industry has aggressively resisted.

They are also expected to address the timetable for each country to remove older rail cars from service, as well as set a requirement for thicker hulls on new cars. 

The rail and energy sectors have both resisted measures that they have said are too costly to implement for the small safety improvement they deliver.

Electronically controlled pneumatic brakes trigger all axles simultaneously rather than one at a time in current design and many safety advocates have said it is an important advance.

Large rail operators have lobbied against including an ECP brake mandate in the oil train rules, telling U.S. regulators in March that they "would not have significant safety benefits" and "would be extremely costly."

On Thursday, the leading voice for the refining industry said a five-year phase out of existing tank cars - a timetable endorsed by the U.S. National Transportation Safety Board - was unrealistic.

Of particular concern to regulators is crude oil originating from North Dakota's Bakken energy patch, where about 70 percent of the roughly 1.2 million barrels of oil produced daily moves by rail.

http://www.reuters.com/article/2015/05/01/usa-oil-railsafety-idUSL1N0XR30320150501