The oil markets are trying to rebound after falling hard on Cyprus headlines and deadlines. The risk of Cyprus leaving the Eurozone is rising after the attempts to sell natural gas reserves to Russia have reportedly failed. The European Central Bank is giving Cyprus a Monday deadline to come up with €5.8 billion or $7.5 billion dollars or it is hasta la vista, baby. Well at least to their funding. Now it's up to Cyprus to come up with a viable Plan B or should we say a plan C- after the S&P downgrade?
Word that some type of plan is in the works is giving traders hope. The EU is urging Cyprus to set capital controls on the island's troubled banks to avoid a financial collapse and an exit from the Eurozone. The AFP said ""Cypriot authorities have three things to do before Tuesday: Present a credible and viable plan B to replace the rescue rejected by parliament, install long-term controls on capital placed in the banks, and prepare to merge the two main banks in trouble," the senior European Union source said, adding that there was otherwise a risk of Cyprus having to leave the Eurozone.”
Natural Gas surged to above $4 before backing off after a less than expected withdrawal from supply. The Energy Information Administration reported that working gas in storage was 1,876 Bcf. The 62 Bcf was than the 72 expected the previous week. Still we fell below double digits on the five-year average. Stocks were 502 Bcf less than last year at this time and 162 Bcf above the five-year average of 1,714 Bcf. range.
Well count is not the only indicator of production with gas. According to the Energy Information Administration Natural gas production in Pennsylvania averaged 6.1 billion cubic feet per day (Bcf/d) in 2012, up from 3.6 Bcf/d in 2011, according to Pennsylvania Department of Environmental Protection (DEP) data released in February 2013. This 69% increase came in spite of a significant drop in the number of new natural gas wells started during the year.
Erin Ailworth of the Boston Globe reports that Peter Voser, chief executive of the global energy company Royal Dutch Shell, said Thursday that the United States and the world need to increase the use of solar panels, wind turbines and other renewable energy-generating sources to meet the growing demand for power, but abundant natural gas supplies present the most straightforward way to a cleaner future. Natural gas has had a major resurgence in the United States, where a controversial and water-intensive drilling technique known as hydraulic fracturing — or fracking — has allowed companies like Shell to extract huge volumes of the fuel from shale rock deposits. "The world needs to follow America's lead and take full advantage of the cleanest-burning fossil fuel, and that's natural gas,” Voser said during his 30-minute speech at a luncheon held by the Boston College Chief Executive's Club of Boston. "Increased use of natural gas is the biggest single step that the world can take today to begin reducing” carbon dioxide emissions, which contribute to global warming and climate change.
Critics, however, say that natural gas is still a fossil fuel that produces greenhouse gases, and they worry that abundant supplies of the cheap resource are stunting the adoption of renewables like wind and solar. Additionally, fracking has come under fire for contributing to water contamination and other environmental problems.
Speaking before business and government leaders, including Boston Mayor Thomas M. Menino, Voser said climate change is a serious threat that can be addressed only by making use of a variety of clean energy sources and energy-efficient technologies.