Thread: Archive Latest News - Think Tank - 03/11/07 - 31/12/07

Iran ready to sell natural gas and water to Arab Gulf countries

Iranian President Mahmoud Ahmedinejad said in the opening of the GCC summit in Doha that his country is ready to sell natural gas and water to its neighbors of the Arab Gulf countries.

On the other hand, Omani Foreign Minister Youssef Bin Alwi Bin Abdullah said that ministers of Arab Gulf countries are studying the possibility of disengaging their countries’ currencies from the dollar. He explained that these countries are discussing whether US currency decline is temporary.

Alsumaria Iraqi Satellite TV Network | Economics News | Iran ready to sell natural gas and water to Arab Gulf countries

Iraq uncovers massive field of natural gas

Iraq’s Oil Ministry uncovered a massive oil field for natural gas in the western desert of Anbar Province. Media official in Iraq’s Oil Ministry, Assem Jihad, affirmed that new mechanisms and promising projects have been put forth to invest gas in Ikaz field. Jihad added that the Ministry seeks to invest the utmost of the filed as it contains large quantities of natural gas. A number of parties including the European Union have showed interest to excavate these quantities, Jihad said. He explained that this field is one of the major projects that could make Iraq one the countries to export natural gas.

On the other hand, Iraq’s oil exports have decreased in November by 50,000 barrels per day, compared to the highest level it has reached since three years last month, navigation sources said.

Alsumaria Iraqi Satellite TV Network | Economics News | Iraq uncovers massive field of natural gas

Iraq Presidency Council ratifies Investment Law

The Presidency Council has ratified the investment law related to crude oil refining. The Presidency statement affirmed that this law allows to the private sector to build up crude oil refineries and possess facilities in addition to operating and marketing its products. The law stipulates however on investing companies to employ Iraqi units including at least 57% of work force. The law came in line with new economic changes in Iraq aimed to increase investment opportunities of the local and foreign private sector, the statement explained.

Alsumaria Iraqi Satellite TV Network | Economics News | Iraq Presidency Council ratifies Investment Law

OPEC says it has no control on climbing oil prices

The current head of OPEC's ministerial council, Mohammed Al Hamili, said that climbing oil prices are out the organization’s responsibilities, saying that OPEC concentrates on the offer and demand. For his part, head of Libyan delegation in OPEC, Shokri Ghanem, said the organization should not decide on raising oil production in their Wednesday meeting. He added that OPEC provides the market with an excess of its needs.

In the same context, Qatari Oil Minister Abdullah Al Attiye ruled out the possibility of OPEC changing oil production levels in its coming meeting to be held in the United Arab Emirates.

Alsumaria Iraqi Satellite TV Network | Economics News | OPEC says it has no control on climbing oil prices

A top US Treasury official says stalled Oil Law, not insecurity, hampering Iraq Oil Investment

A top U.S. Treasury official said Tuesday that international oil companies are ready to invest in Iraq de****e the dangerous security situation, but they are largely holding off because the nation hasn't passed a new oil law.

Deputy Treasury Secretary Robert Kimmitt, speaking to reporters during a trip to Iraq, said that until an oil law is enacted, both U.S. and international firms are unlikely to invest heavily in Iraq's industry.

''A lot of times people think they're not investing because the security situation is difficult,'' Kimmitt said. ''Well, the security situation is improving, and as the oil companies will tell you, they invest in many places in the world where security is a tough factor.''

In addition to a new oil law - which remains stalled in parliament - Kimmitt said companies want to see solid investment rules and regulations before pumping money into Iraq.

''What I hear from the companies who talk to me, both U.S. and international oil companies, is they come in and they want to know what the rules of the road are. With whom should I be contracting? Is that party a qualified contracting party? If there is a dispute, what is the dispute resolution mechanism?''

Iraqi authorities have drafted numerous versions of legislation to regulate the country's oil industry and share the revenues among Shiite, Sunni and Kurdish communities.

But the effort has bogged down in large part because of opposition from the Kurds, who want a greater say in managing oilfields in their self-ruled area of the north.

The Kurds have signed more than a dozen contracts with foreign companies, insisting the constitution gives them that authority. But the Oil Ministry insists the contracts are illegal and has threatened to blacklist foreign firms who sign them.

Kimmitt told reporters that the Treasury Department was discouraging oil companies from investing in any part of Iraq's oil sector until the nation passes its oil law.

U.S. officials view the oil law as a catalyst for investment and a means of tamping down sectarian violence. Most of Iraq's oil reserves are in the Kurdish north and the largely Shiite south. The provinces where most Sunnis live have few proven reserves, leading to suspicions they'll be left out of oil profits.

Speaking outside of the oil sector, Kimmitt expressed optimism about Iraq's general economic direction, especially considering recent security improvements.

Kimmitt said the improving security should give Iraq's economy some breathing room and the chance to expand.

''From a macroeconomic perspective ... we see a strong foundation having been laid by the Iraqi government. They have a strong, stable currency, inflation is dropping significantly and oil exports are increasing,'' he said.

Iraq is now exporting 1.9 billion barrels of oil a day, Kimmitt said, compared with 1.5 million a day earlier this year. The reason for that jump, he said, was the opening of an oil export pipeline in the north in late August, which has added between 200,000 and 300,000 barrels per day in capacity.

That extra capacity, Kimmitt said, will help fatten Iraq's coffers, allowing the country to make the capital investments it needs to grow export capacity in the oil sector and even devote more money toward security - thus relieving the U.S. of spending money in that area.

In part because of the high price of oil, Iraq's budget for next year will be at $48 billion, Kimmitt said. Of that, about $9.3 billion will be devoted to security, and increase from $7.2 billion in the previous year.

Santa Barbara News-Press

Iraqi Kurd and U.S. Oil Chiefs Meet

The U.S. energy secretary "encouraged" the visiting Iraqi Kurdish region's oil minister to work with Shiite and Sunni Iraqis on a national oil law.

The Kurdistan Regional Government's oil minister and the deputy prime minister also met with U.S. Vice President Dick Cheney and other political and business officials during their two-week visit to Washington.

"The message was quite simply that we encouraged them to work with their counterparts … to develop an oil law in that country that would deal with the needs of all Iraqis," Energy Secretary Samuel Bodman said at a news conference Tuesday hosted by the global energy information firm Platts. "I personally met with them and I personally encouraged them, didn't tell them what to do or how to do their job, but I did encourage them to work with the Sunnis and the Shia communities in Iraq to develop an oil law that makes sense. That was all. That was the message."

Bodman also said he's telling the central government of Iraq to make the Oil Law a priority as well.

He's not, however, pressing the international oil companies to refrain from or stop signing oil deals in Iraq prior to the law.

The KRG blames the central government for stalling the law and has moved forward with its own regional oil law and signed more than 20 deals with international oil companies.

Iraq's Shiite-majority government, as well as the Sunni minority, says the KRG's demands for decentralized control over the oil sector goes too far and criticizes the semiautonomous region's deals.

Iraq's national Oil Minister Hussain al-Shahristani said he'll begin signing oil deals soon, relying on the Saddam-era oil law instead of the lagging new national oil law. Like the national government's critique of their deals, the KRG calls Shahristani's moves unconstitutional.

"We're talking to them in the same spirit that we're talking to the Kurds," Bodman said, "and that is we are encouraging them to get an oil law passed that would satisfy the needs of the Iraqi citizens."

The law is intended to delegate control and responsibility to develop Iraq's vast hydrocarbons sector but is stuck on disagreements as to whether the central government or regional and local governments should have control, as well as the extent foreign firms should be allowed to invest.

Most large firms are waiting for a national oil law, though the KRG has begun signing with small and medium companies, such as India's Reliance Industries, OMV of Austria, MOL of Hungary and Dallas-based Hunt Oil.

"We've talked to the companies all the time in terms of their general approach and attitudes and I have not found it necessary to tell them that Iraq needs a national oil law that will help find the country together," he said.

Bodman said he hasn't talked with U.S. firms involved in the KRG deals.

International Security - Energy - Briefing - UPI.com

OPEC MEETING Iraq Oil Minister refuses to speculate on output hikes

Iraqi Oil Minister Hussain al-Shahristani would not be drawn on whether OPEC will announce an output increase at the cartel's meeting tomorrow in the United Arab Emirates.

One of the final oil ministers to arrive in Abu Dhabi ahead of the meeting, al-Shahristani did tell journalists: "Our current exports are 2 mln bpd and we expect to maintain that through December."

OPEC MEETING Iraq oil minister refuses to speculate on output hikes

Oil Falls More Than $1 as Official Says OPEC May Raise Output

Crude oil fell more than $1 a barrel in New York after an OPEC delegate said the group would discuss a production increase at its meeting tomorrow.

The Organization of Petroleum Exporting Countries, which supplies more than 40 percent of the world's oil, will meet in Abu Dhabi to decide on output for early 2008. An increase would help prevent accusations the group is doing nothing to ease high prices, said the official, who declined to be identified.

``OPEC will probably increase output, either officially or unofficially,'' said Brad Samples, commodity analyst for Summit Energy Inc. in Louisville, Kentucky. ``OPEC has every incentive to sell in this market.''

Crude oil for January delivery fell $1.67, or 1.9 percent, to $87.64 a barrel at 10:55 a.m. on the New York Mercantile Exchange. Futures reached $99.29 on Nov. 21, the highest since trading began in 1983. Prices are up 40 percent from a year ago.

``It's questionable that OPEC would be comfortable with prices at $90, especially given that the U.S. economy teeters on the edge of recession, threatening to cut consumption,'' Samples said.

Prices have dropped from record highs on speculation that subprime-mortgage losses in the U.S. will spread through the economy, reducing growth and demand for fuels.

Demand May Slow

``I think we could be headed down, back into the $70s,'' said Phil Flynn, a senior trader at Alaron Trading Corp. in Chicago. ``Because of the slowing economy here in the U.S., demand growth will not be as strong as it has been in past years.''

OPEC members including Iran, Venezuela, Qatar and Libya have said today that sufficient global oil supplies preclude the need for a production increase.

``All options are open,'' Saudi Oil Minister Ali al-Naimi told reporters in Abu Dhabi today. Three days ago, he told reporters in Doha, Qatar, that crude inventories are ``very comfortable.''

U.S. crude-oil stockpiles fell 1.25 million barrels in the week ended Nov. 30, according to the median of responses by 12 analysts surveyed by Bloomberg News. The Energy Department is scheduled to release its weekly report on inventories tomorrow at 10:30 a.m. in Washington.

Brent crude oil, which is produced in the North Sea, exceeded West Texas Intermediate, the U.S. benchmark, for the first time since August during trading yesterday. Brent has traded at a discount to WTI for more than four months.

Brent crude oil for January settlement declined 43 cents, or 0.5 percent, to $89.37 a barrel on the London-based ICE Futures Europe exchange. Brent reached $96.65 a barrel on Nov. 26, the highest since trading began in 1988.

Iranian Nuclear Program

President George W. Bush said the international community must keep up pressure on Iran because the government there could restart development of a nuclear weapon at any time.

``Iran was dangerous, Iran is dangerous and Iran will be dangerous if they have the knowledge necessary to make a nuclear weapon,'' Bush said during a news conference today at the White House. ``What's to say they couldn't start another covert nuclear weapons program.''

The Persian Gulf nation halted its nuclear weapons program four years ago and hadn't resumed it as of mid-2007, according to declassified portions of the U.S. National Intelligence Estimate released yesterday. Even if the program were resumed, Iran wouldn't be able to produce enough material for a bomb until 2010 at the earliest, the report said.

Iran has the second-biggest proved oil reserves and is the second-biggest producer in OPEC, after Saudi Arabia. Almost a quarter of the world's oil flows through the Strait of Hormuz, a narrow waterway between Iran and Oman at the mouth of the Persian Gulf.

Bloomberg.com: *********

Power-sharing ends Northern Iraq Dispute

Sunni Arabs ended a yearlong political boycott Tuesday in Kirkuk -- the hub of Iraq's northern oil fields -- under a cooperation pact that marked a bold attempt at unity before a planned referendum on control of the strategic region.

The Sunni-Kurdish deal -- urged by U.S. diplomats -- could also move ahead other reconciliation bids demanded by Washington but stalled by disputes that include sharing oil wealth and compromising with Sunnis who backed Saddam Hussein's Baath party.

Sunnis have struggled to find political footing since Saddam's fall, as majority Shiites cemented control of the government and security forces and Kurds enjoyed an economic boom in their semiautonomous enclave.

A planned referendum on Kirkuk, possible next year, could give the Kurds another windfall. It will ask whether the province -- and its important oil fields -- should fall under the Kurdish borders or continue to be governed by Baghdad.

Apart from the petrodollars at stake, Kurds have a strong cultural and emotional attachment to Kirkuk, which they call "the Kurdish Jerusalem." But Kirkuk's Arabs -- who include many Shiites resettled by Saddam -- largely favor continued rule by Iraq's central government.

Turkey and other countries in the region with Kurdish minorities have long feared that Kurdish rule of Kirkuk would encourage Kurds to break away from Iraq.

Tensions spiked when Sunni Arab lawmakers walked out of the provincial council in November 2006, claiming discrimination by the Kurds. The boycott ended Tuesday after Kurdish lawmakers agreed to allot one-third of government jobs, such as police and other officials, to Arabs and appoint an Arab as deputy governor.

Adding a deputy governor is a roundabout way for Sunni Arabs to gain more power, de****e currently holding only six of the provincial council's 41 seats. The Kurdish bloc dominates with 26 seats, largely because Sunni Arabs across Iraq sat out the last provincial elections, in 2005.

Turkomen -- the smallest of the area's main ethnic groups -- hold nine seats. They also prefer rule by Baghdad, but have lobbied for their own sovereignty if Kirkuk is swallowed by the Kurdish region.

Kurds are generally thought to have a slight majority in the province, with Sunni Arabs close behind. But a census has not been conducted in 50 years.

Returning Sunni lawmakers said they hoped an Arab deputy governor would prevent their bloc from being steamrolled by the Kurds.

"Last year, we felt that decisions were forced on us. That wasn't power-sharing -- we had no key representation even though we were sitting there," said Ramla Hamid, one of the Sunni Arab lawmakers who retook her council seat Tuesday.

The Arabs' return to politics culminates a year of behind-the-scenes prodding by other Iraqi leaders and American diplomats.

"It's important, but it's really just the first small step in a long reconciliation," said Howard Keegan, head of the State Department team aiding reconstruction in the Kirkuk province.

The Kurdish majority "doesn't need the Arabs to govern, but that they want a unity government anyway is significant," Keegan said, adding that cooperation from all parties is needed to "make it to the referendum and avoid violence."

Tuesday's move also represents the Arab lawmakers' tacit approval of the Iraqi constitution, Keegan said, including Article 140 -- which calls for a census and referendum on Kirkuk's status by the end of this year.

Officials have said they will not make the 2007 deadline, but hope the vote will happen sometime next year. It is also unclear when new elections for the Kirkuk provincial posts could be held.

During Saddam's rule, tens of thousands of Shiite Arabs were moved to Kirkuk under an "Arabization" program.

At the same time, many Kurds fled the area after Saddam accused them of siding with Iran during the 1980-88 war. Since Saddam's ouster, thousands of Kurds have returned to Kirkuk -- only to find, in some cases, Arabs living in their homes.

Article 140 calls for a period of "normalization" in Kirkuk -- providing housing for Kurdish returnees and compensation to Arabs who volunteer to return to their ancestral homes in Baghdad or southern Iraq. But the process is slow, and there are cries of fraud from both sides.

Power-sharing ends northern Iraq dispute

550 billion dinars for the Budget of Baghdad Mayoralty in 2008

"Ameen Baghdad", Sabir Al-Isawi, said on Sunday that the Cabinet allocated a current budget for the year (2008) for Baghdad Mayoralty amounting to (550) billion dinars, in addition to an income derived from the collection of fees and estimated by approximately (23) billion dinars.

Al-Isawi said, during the extensive meeting of cadre to discuss the budget of (2008) and the share of each department in the Mayoralty, that "the daily wages system of the cleaning-workers will be stopped since the beginning of the year and start working by the contracting and employment system where each contract would range between 3 to 6 months in accordance with the plan developed by each municipal department including the names of workers and geographical areas it is responsible for cleaning to prevent any administrative corruption."

He also said that all municipal departments will start working, this month, by evening shifts, from 2 p.m. until 7 p.m., while some municipal departments will work by a third shift starting from 7 p.m. till midnight; all of them will be provided with the necessary supplies, after strengthening the municipal budget for each department by at an additional billion dinars.

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