OPEC Expands Oil Rigs Most in Three Years as Quota Promises Prove Illusory (Bloomberg) — OPEC is increasing oil drilling at the fastest rate in 2 1/2 years, even as production exceeds its quotas by the equivalent of a supertanker of crude a day and delegates prepare to pledge no increase in output. The 12-nation group boosted its number of oil and gas rigs by 8.4 percent in January and February, the biggest two-month gain since June 2007, data from Baker Hughes Inc. show. OPEC members excluding Iraq pumped 26.8 million barrels a day last month, 1.9 million more than targeted, data compiled by Bloomberg show. Shipments will rise again this month, according to tanker-tracker Oil Movements. While oil prices recovered from a four-year low at the end of 2008 as OPEC announced a record supply cut, excess production means the doubling in oil prices since then may have run its course, according to the Centre for Global Energy Studies and Commerzbank AG. The premium charged for crude deliveries in 2015 has plunged 43 percent in three months, indicating investors are less concerned of future shortages. OPEC to urge compliance, keep output target steady VIENNA (Reuters) – OPEC ministers due to arrive here for their meeting on March 17 say there is no need to change output targets with oil prices above their preferred range, but soft demand is prompting calls to curb overproduction. “In my opinion, I don’t think we are going to see any change, even though inventories are high,” Qatar’s Oil Minister Abdullah al-Attiyah told Reuters by telephone on Monday. Global LNG Shipments to Accelerate This Year, JPMorgan Says (Bloomberg) — Liquefied natural gas shipments may grow at a faster pace this year because of the global economic recovery and plants increase output, JPMorgan Chase & Co. said. “The last two months of 2009 global LNG exports were the highest on record,” Joseph Allman and Xin Liu, analysts for the U.S. bank, said in a report to clients on March 12. “Large new LNG liquefaction plants are ramping-up and several more are scheduled to start up through 2010 and into 2011.” Power lines take shape in Iraq DAMASCUS – It is now certain that the final results from Iraq’s March 7 parliamentary elections will not be out before the end of March. What we do know for sure is that voter turnout was impressively high, at 62%, and that the State of Law Coalition, headed by Prime Minister Nuri al-Maliki, has the lead across southern Iraq, within the capital Baghdad and in the oil-rich province of Basra, effectively winning seven provinces out of a total of 18. Ex-prime minister Iyad Allawi, a secular Shi’ite and former Ba’athist, is also winning the vote in the predominately Sunni al-Anbar province and the controversial city of Kirkuk, which is inhabited by Arabs and Kurds. Both leaders are bracing themselves for the premiership – Maliki for a continuation, Allawi for a thundering comeback. Chile May Face More Blackouts After 80% Lose Power (Bloomberg) — Chileans braced for more blackouts after an outage yesterday left 80 percent of the population in part of the country without electricity, the result of grid damage from last month’s earthquake. Explosions hit Nigeria oil amnesty talks Two suspected car bombs have been set off in the Nigerian oil city of Warri, where officials were in talks over an amnesty for militants in the area. Witnesses said the explosions shattered windows at the state governor’s office and sent officials fleeing for cover. The militant group Movement for the Emancipation of the Niger Delta (Mend) had issued a bomb threat earlier. Russia Rejects Eni Call to Merge Europe Gas Pipelines (Bloomberg) — Russia isn’t considering merging its South Stream gas pipeline to Europe with the rival European Union-backed Nabucco link, Energy Minister Sergei Shmatko said. South Stream is “more competitive” than Nabucco, Shmatko told reporters in Moscow today

Original Source of Drumbeat: March 15, 2010