New base 747 special 14 december 2015 r

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NewBase 14 December 2015 - Issue No. 747 Edited & Produced by: Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Eight Lessons From the Climate Disaster and Why Paris Worked
Bloomberg - Alex Morales
It took years of careful planning by the United Nations and the 195 countries involved to reach the
historic deal on climate change agreed in Paris on Saturday.
With so many parties involved in highly technical and political discussion about how to limit
emissions from fuels that drive their economies, it’s remarkable anything is ever agreed. The last
time envoys attempted such a sweeping deal, the meeting in Copenhagen in 2009 dissolved in
finger pointing over who should do what to combat global warming.
Here are the eight lessons the UN and key delegates involved in brokering the Paris deal learned
from Copenhagen that led to the success this year:
1) Make it voluntary
The 1997 Kyoto Protocol was a legally binding treaty setting limits for emissions of greenhouse
gases -- but only for industrial nations. After signing the deal, the U.S. backed out because
developing nations had no obligations, leaving Kyoto covering just 37 mostly European nations
and 12 percent of global emissions. The Paris deal reaped pledges from 186 nations by making
the system essentially voluntary. That meant more were willing to sign up -- even the U.S. The
new approach has proven a "game-changer," Indian Environment Minister Prakash Javadekar
said.

2) Prepare the ground
French Foreign Minister Laurent Fabius and his team made more than 100 official visits and held
more than 400 bilateral meetings with 140 different countries over the past two years. Half of
those meetings were at the level of presidents and prime ministers.
“I’m impressed with Fabius’s leadership,” said International Emissions Trading Association Chief
Executive Officer Dirk Forrister, a climate adviser in U.S. President Bill Clinton’s administration.
“His sheer presence and seriousness and experience helped to provide some discipline.”
3) The big players need to agree
It’s a deal uniting 195 countries, but the U.S. and China are the most important since they account
for 35 percent of emissions. The two countries didn’t coordinate positions in Copenhagen, where
China stood with Brazil, India and South Africa in wanting to preserve distinctions in the way the
talks deal with rich and poor nations. In 2009, President Barack Obama had to force his way into a
meeting of that bloc to have his voice heard. This time, he and Chinese President Xi Jinping came
to an agreement in November 2014, spurring other developing nations to join in on taking action.
“The United States has invested enormously in a better dialog with China and the other major
economies,” said Global Green Growth Institute Director-General Yvo de Boer, who as UN climate
chief in 2009 oversaw the failed talks.
4) Choreography counts
Almost 150 heads of state and government attended the Dec. 1 opening of the summit in the
biggest single-day gathering of world leaders in history. Their job? To provide the political
momentum -- and then get out of the way. In Copenhagen, more than 100 leaders came at the
end of the conference, paralyzing the work of lower-level envoys who are experts in the forensics
of treaty negotiation.
“All the negotiators had to babysit the ministers and at the same time their heads of state, so they
didn’t have any time to spare for the actual negotiations,” Japanese envoy Kuni Shimada said of
the 2009 meeting.
5) Atmospherics matter
Logistical snafus in Copenhagen helped poison the atmosphere of the talks. There were long lines
to accredit and pass through security, leaving many negotiators standing in the cold while it
snowed. The French ensured the little things worked. The food was a notch above previous

meetings, with pastries and bottles of Mouton Cadet reserve wine. Water stations were ubiquitous,
and the toilets were clean. Shuttle buses ran like clockwork, and public transport was free. During
the final days, daybeds came in handy for tired delegates shuffling between round-the-clock
sessions.
6) Learn from past approaches
France used the tactics that worked at previous climate conferences. They copied a formula from
the meeting in Cancun, Mexico, in 2010 by using pairs of ministers from developed and
developing countries to help work through the thorniest topics. They held open informal meetings
open to all negotiators called "indabas," named for a traditional gathering of village elders that
South Africa first used with great success in Durban in 2011. And they brought on board Claudia
Salerno, one of the envoys who helped sink the Copenhagen deal, to work on a part of the text.
“Engaging former critics is what good diplomacy is all about,” said Paul Bledsoe, a former Clinton
adviser.
7) Transparency is essential
In Copenhagen, the Danish presidency that ran the meeting picked a group of countries to work
on an accord. The countries left out lost trust in the process, accusing the hosts of drawing up a
“secret text.” France was careful to include everyone at each stage -- logistically difficult but
politically necessary.
“When we’ve seen the presidency straying from the right path, we’ve immediately told them, and
they’ve listened and corrected,” said Salerno from Venezuela. In Copenhagen, she called the
Danish efforts “a coup d’etat” on the UN charter.
8) Involve business
Companies were given a portal to register their own efforts to slash emissions, making them far
more supportive than in Copenhagen. More than 2,400 companies and investors have posted
pledges so far. Ultimately, it’s business that will have to deliver many of the emissions cuts and
technological solutions to climate change, so involving industry made reaching a deal seem
possible or even desirable.

Japan and India agree bullet train, nuclear deals
AFP + NewBase
Japan and India agreed several high-profile deals Saturday including on high-speed rail, defence
technology and civil nuclear cooperation, Indian Prime Minister Narendra Modi said in New Delhi.
Following talks with his Japanese
counterpart Shinzo Abe, Modi said the
pair had agreed plans for Japan to
build India's first bullet train to slash
journey times between the cities of
Mumbai and Ahmedabad.
"This enterprise will launch a revolution
in Indian railways and speed up India's
journey into the future," Modi said of
the deal, adding that Tokyo would also
extend a $12 billion package of
financing and assistance for the train.
"It will become an engine of economic transformation in India." The two leaders also agreed a
long-mooted memorandum of understanding on the peaceful use of nuclear energy, which will be
signed once technical details are finalised, a spokesman for India's foreign ministry said on
Twitter.
Japan once shunned nuclear cooperation with India, which has not ratified the international
nuclear Non-Proliferation Treaty, but analysts say Tokyo has since softened its stance. The two
countries also agreed to explore future projects on defence technology transfer, including on
Japanese-made US-2 amphibian aircraft.
Modi also said India would extend visas on arrival to Japanese citizens from next year. Modi and
Abe, both right-wing nationalists, have forged an unusually close relationship since the Indian
leader came to power last year, in part to counter China's growing influence.
The Indian PM has pledged to overhaul India's ramshackle railways and other infrastructure as
part of his ambitious economic reforms -- an area praised by Abe earlier in the day. "Prime
Minister Modi's economic policies are like Shinkansen -- high speed, safe and reliable while
carrying many people along", the Japanese premier said in a reference to the Japanese bullet
train.
After a meeting with business leaders on Saturday morning, Modi lauded the recent decision by
Japanese-owned carmaker Maruti Suzuki to export Indian-made Baleno cars to Japan. "For the
first time, Japan will import cars from India. And Maruti will manufacture cars here," Modi said.
Tokyo is encouraging Japanese businesses to tap fast-growing emerging markets such as India,
as the domestic market shrinks due to a rapidly ageing population and low birthrate. The two
leaders are expected to leave later Saturday for India's holiest city of Varanasi and the premier's
parliamentary constituency.
India's economic growth accelerated to 7.4 percent in the second quarter of the financial year,
figures released in November showed, outperforming China.

Saudi to set strategy for era of cheap oil as red ink flows
Reuters + NewBase
Saudi Arabia’s government is expected to announce spending cuts and a drive to raise revenue
from new sources as it lays out a strategy to cope with an era of cheap oil, people familiar with
Saudi policy-making said.
Markets in the world’s top oil exporter are jittery because low crude prices have pushed state
finances deep into deficit and so far, the government has not revealed a detailed, comprehensive
plan to stem the flow of red ink.
But in coming weeks, authorities will make their intentions clearer. The state budget for 2016 is
expected to be released on or around December 21, official sources said.
In the following weeks, probably in January, the government is to reveal a multi-year economic
plan that may include longer-term reforms such as cuts to energy subsidies and new taxes.
The budget will be the first drafted by the administration of King Salman, who took the throne in
January, and the first carrying the imprint of his son Mohammed bin Salman, who chairs a
powerful new Council of Economic and Development Affairs that now dominates the economic
policy apparatus.
“A strategic review of economic policy is underway in the government and officials are putting
together a new framework for managing the economy,” said Khalid Alsweilem, a former senior
official at the central bank, now fellow at the Harvard Kennedy School’s Belfer Center in Boston.

He said much of the work was occurring at the Ministry of Economy and Planning, where Adel al-
Fakieh became minister in April. As labour minister in 2010-2015, Fakieh developed a reputation
for implementing complex reforms.
Under al-Fakieh, the economy ministry has gained influence while the Ministry of Finance has
become less central, Alsweilem said. “There’s a 180 degree change in the way policy-making is
being done.” The government’s deficit this year is expected to come in at about 400-500bn riyals
($107bn-$133bn), around 20% of gross domestic product.
To ease market jitters, the government will need to cut next year’s deficit sharply. Prominent Saudi
economists contacted by Reuters expect the 2016 budget to plan spending of about 800bn riyals,
roughly 20% lower than their estimate of this year’s actual spending.
The government is likely to curb public sector wage rises and bonuses, but that is sensitive, so
most spending cuts would occur in public investment. “The state has delivered a lot of
infrastructure projects, so spending should normally decline gradually over the next few years,”
said Mazen al-Sudairi, research chief at al-Istithmar Capital.
In the past Riyadh has
often overspent its
annual budget plan, but
one change introduced
by Mohammed bin
Salman is expected to be
stricter adherence to the
plan. He told the New
York Times last month
that one of his key
challenges was “the way
we prepare and spend
our budgets”.
The result, if Brent oil
stays around $40 a barrel
next year, could be a budget deficit of around 200bn riyals - still large, but enough of a reduction
to let Riyadh slow the liquidation of its foreign assets.
If oil stays cheap for years, deeper reforms will be needed to stabilise state finances; the multi-
year economic plan may prepare the ground for this. Officials have said they are looking at
raising domestic energy prices, potentially saving some of the over $100bn spent annually to keep
prices low.
Subsidy cuts would start with rises in the cost of natural gas feedstock and power for industry;
politically difficult hikes in domestic petrol prices would come later and be spread over years, said
a source familiar with official thinking.
The government is also considering privatisations and new taxes. The cabinet has approved a tax
on undeveloped urban land that could be introduced as soon as the end of next year.

Algeria: PetroVietnam says first flow of oil in Algeria’s Bir Seba field
Source: vietnamnet.vn
The PetroVietnam Exploration Production Corporation (PVEP) welcomed the first flow of
commercial oil from Bir Seba oil field, lot 433A and 416B, during a ceremony in Algeria on
December 11.
The project is underway through a joint venture between PVEP, Thailand’s PTT Exploration and
Production Company (PTTEP) and Algeria’s state-owned oil and gas company Sonatrach with
a respective stake of 40 percent, 35 percent and 25 percent.
It is the first successful project abroad of PVEP and the Vietnam Oil and Gas Group, which started
in 2003 with an international bidding through a surveying process to 2008. Launched in 2009, the
Bir Seba joint-venture has a total capital of 1.26 billion USD and is operated by Groupement Bir
Seba.
Hoang Ngoc Dong, Director of the PVEP-Algeria company, said the joint-venture has drilled 16
wells and tapped nearly 20,000 barrels per day and one million barrels as of November 4. The
second phase of the project is expected to begin in the foreseeable future and the total output is to
increase to 40,000 barrels per day in early 2020.

Vietnam’s oil and gas sector has extended its reaches to many countries worldwide such as
Venezuela, Russia and Algeria. The North African country is one of the top three oil producers in
the region with a total production of roughly 5.7 billion tonnes (38 billion barrels), a daily output of
180,000 tonnes (1.2 million barrels), ranking 12 th in terms of output and ninth in exports.
Having 4.500 billion cubic meters in reserve, which is capable of producing 60 billion cubic meters
per year, Algeria is also the leading natural gas producer in Africa, the second biggest gas
supplier to Europe and the fourth largest in the world.
Bir Seba oil field is located in the Hassi Messaoud province in the Sahara desert, more than
600km from the capital to the south – the petroleum capital of Algeria in which the PVEP and
PetroVietnam Drilling & Well Services Corporation are based.
During his official visit to Algeria in late May, Prime Minister Nguyen Tan Dung said the first flow of
commercial oil is the result of long-term joint efforts between Vietnamese and Algerian firms,
contributing to fostering the bilateral traditional friendship and cooperation and creating a new
impetus to extend partnerships beyond traditional areas.

Turkmenistan: TAPI gas pipeline project inaugurates
By AFP
Leaders of Turkmenistan, Afghanistan, Pakistan and India broke ground Sunday on a $10 billion
gas pipeline expected to help ease energy deficits in South Asia and stem tensions in the divided
region.
Presidents Gurbanguly Berdymukhamedov of Turkmenistan and Ashraf Ghani of Afghanistan
attended the ceremony in the Karakum desert outside the southeastern Turkmen city of Mary,
marking the beginning of work on the Turkmenistan-Afghanistan-Pakistan-India (TAPI) link.
They were joined by Prime Minister Nawaz Sharif and Indian Vice President Mohammad Hamid
Ansari. “Today we were participants and witnesses of a historic event. Today marks the start of a
project of great scale – the TAPI pipeline,” said Berdymukhamedov during the ceremony, which
took place in a pavilion imitating a traditional Turkmen nomadic dwelling.
Turkmenistan has said it expects the gas link with an annual capacity of 33 billion cubic metres to
be completed by the end of 2018.
Turkmenistan begins work on TAPI pipeline
Afghanistan, India and Pakistan have all repeatedly stated their commitment to the natural gas
project despite the bilateral tensions Delhi and Kabul have with Islamabad. On Sunday, the
leaders praised the pipeline as a political project that will help bring about better relations in the
volatile region.
“The TAPI gas pipeline project will help promote peace and trade amongst the regional countries,”
said PM Nawaz. The Indian vice president said TAPI was “more than a project” and described it
as “the first step to the unification of the region”, in translated remarks.

Afghanistan’s Ghani, for his part, said the project demonstrated the countries’ political will. “We
are committed to the stable development of the entire region which will develop in an active and
stable manner if we cooperate,” he said in translated remarks.
Prime Minister Nawaz Sharif with president of Afghanistan and Turkmenistan and Indian vice
president at the ground-breaking ceremony of TAPI in Turkmenistan on December 13, 2015.
PHOTO: PID
Energy experts say the project does indeed have potential to ease relationships in the divided
region.
“TAPI is a challenging project, partly because of these bilateral tensions,” said Charles Hendry,
Britain’s former energy and climate change minister.
“But I think it is precisely this kind of big multi-state project that can bind countries together
geopolitically,” Hendry, chairman of London-based Eurasia Partners consultancy, told AFP at an
energy conference in Turkmenistan’s capital Ashgabat last month.
Berdymukhamedov also said Sunday marked the beginning of the third phase of development of
the Galkynysh gas field which will provide the resource base for the TAPI pipeline.
The next phase of development at Galkynysh – the second largest natural gas field in the world —
will be overseen by a consortium of Japanese and Turkish companies in addition to Turkmenistan,
Berdymukhamedov said.
Uncertainty hangs over the costly TAPI project, however, with both security and the lack of a
major commercial investor stymieing optimism.

“Initially the questions were about whether Turkmenistan had enough gas and whether the
demand was there in India and Pakistan,” Luca Anceschi, a Central Asia expert at the University
of Glasgow, told AFP by telephone on Sunday.
“With the assessment of the Galkynysh field and the situation in both those countries, those
questions have now been answered positively. But the question of security is one that really
hangs over the project and increases its costs.”
Several major Western energy firms have appeared to back away from the project, with only
Dubai-based Dragon Oil, which works in Turkmenistan’s petroleum sector, confirming interest.
Nevertheless, a spokeswoman for the company’s Turkmenistan office said in emailed comments
last month that “nothing had formally been decided” regarding its participation in the project.
The isolated Central Asian state has shown increasing will to get the project off the ground amid a
worrying dependence on China, which imports around three-quarters of its national gas output via
the Central Asia-China pipeline, completed at the end of 2009.
Turkmenistan once suffered from a similar dependence on former master Russia, which was the
country’s main customer before China came to the fore.
But Moscow’s energy giant Gazprom announced its intention to wind down purchases of Turkmen
gas and was blasted in a Turkmen government publication as an “unreliable partner” this year
amid ongoing contractual disputes.

China's strategic oil reserves double to 190 million barrels
Source: Reuters + NewBase
China said it more than doubled the size of its strategic crude oil reserves between November
2014 and the middle of this year, building inventories at a rate exceeding analysts' estimates of
the country's stockbuilding. The world's largest energy consumer increased its reserves to 26.1
million tonnes, or about 190.5 million barrels, by mid-2015, the National Bureau of Statistics
said on Friday. The increase occurred as the country took advantage of steep declines in oil
prices to stockpile crude.
Analysts have closely
watched China's stockpiling
efforts to better gauge how
much of the country's oil
imports are going into the
reserves and how much is
actually being refined and
consumed. China intends to
build crude reserves of 550
million barrels by 2020. The
190.5 million barrels is
equivalent to about one
month of Chinese net crude
imports.
The government made its
first announcement on the size of its strategic reserves in November 2014, putting them at 91
million barrels. The latest figures, which include reserves stored at eight government reserve
bases and some commercial tanks, show an increase of roughly 100 million barrels, far more than
the 30-40 million estimated by most analysts.
'The numbers are in line with our estimates, but due to the lag in reporting last year, the stockbuild
was not as strong as the numbers show,' said Barclays analyst Zhang Chi, adding that last year's
announcement may have underreported the total amount in reserve since it didn't count some
facilities that had begun stockpiling around 2012.
The country generated an implied excess of 109 million barrels between January and July,
Reuters calculations using production, import and refinery throughput data show - an amount that
would be available to store in its growing stockpiles.
China is expected to add 70-90 million barrels to its strategic crude oil purchases next year,
offering some support to battered markets for the commodity. The reserves are being stored in
seven above-ground facilities at Zhoushan, Zhenhai, Dalian, Huangdao, Dushanzi, Lanzhou and
Tianjin, as well as one underground facility at Huangdao, with a total capacity of 28.6 million cubic
metres (about 180 million barrels), the statistics bureau said.
In addition to the national reserve bases, industry sources have told Reuters that the government
has also rented storage tanks from private firms to build the stocks. Friday's announcement, the
second time the Chinese have released data on the stockpiles, means the government may make
it an annual reporting, analysts said.

NewBase 14 December - 2015 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil prices drop for seventh session on oversupply worries
Reuters + NewBase
Crude oil futures fell for a seventh straight session on Monday, their longest losing streak since
mid-2014, as a forecast from the International Energy Agency (IEA) that the global supply glut was
likely to deepen next year dragged on prices.
Brent crude LCOc1 fell below $38 a barrel for the first time since December 2008 on Friday after
the IEA said demand growth was slowing while OPEC output remained high. U.S. crude, West
Texas Intermediate (WTI) CLc1, settled in the $35 territory for the first time since February 2009.
Front month WTI was down 16 cents at $35.46 a barrel by 0410 GMT, while Brent was down 23
cents to $37.70 a barrel.
Both benchmarks have fallen every day since the Organization of the Petroleum Exporting
Countries (OPEC) on Dec. 4 abandoned its output ceiling. In the past six sessions, they have
shed more than 13 percent each. OPEC has been pumping near record levels since last year in
an attempt to drive higher-cost producers such as U.S. shale firms out of the market.
New supply is likely to hit the market early next year as OPEC member Iran ramps up production
once sanctions are lifted as expected following the July agreement on its disputed nuclear
program, BMI Research said in a note.
"All new production will be earmarked for exports," BMI Research said. "In addition to volumes
released from storage, Iran will be able to increase crude oil and condensates exports by a
maximum of 700,000 b/d by end-2016," it said.
Oil price special
coverage

Lower oil prices 'big tax cut' for travellers, says IATA chief
Gulf Times - Pratap John
Lower oil prices have come as a sort of “big tax cut” for many people around the world, enabling
them to fly “economically and easily”, said Tony Tyler, IATA Director General and CEO.
“Lower oil prices have made costs lower for airlines. And that is
a good thing from an airline point of view. People have more
money in their pocket, and so, many around the world will
perhaps find it easier to travel. They will have more
discretionary money to spend,” Tyler told Gulf Times at the
IATA headquarters in Geneva.
“But when fuel price comes down like this, there are other
aspects to consider,” Tyler said referring to economies that depend on oil for revenues. “Of
course, in the economies that depend on oil for revenues; it could be a problem. There will be less
revenue around,” he stressed.
Also, Tyler said, weak commodity prices and adverse currency fluctuations have certainly
impacted many airlines, especially those from the emerging economies. “Many airlines around the
world have seen a drop in their currencies even as the fuel costs are coming down. So, in the
local currency, they are not seeing any saving at all.” The other problem, Tyler pointed out, was
that most of the airline costs were denominated in dollar.
“They buy aircraft in dollars … spare parts in dollars. They have to pay back the loan in dollars …
or the lease charge in dollars. They also have to clear their interest in dollars. Same is the case
with landing, handling and catering charges in airports. Airlines from outside the dollar area have
to pay a lot of these costs in dollars – not just for fuel.”
IATA chief economist Brian Pearce said for 2016, the International Air Transport Association
forecast the airlines fuel bill would fall to $135bn, which represent 20.6% of their total operating
costs. Jet fuel prices have fallen substantially and IATA based its forecast on an average price of
$63.8 per barrel next year, and $51 per barrel for the Brent crude.
“The future price of oil is highly uncertain, with some forecasters expecting $20 per barrel in 2016
while others expect a rise to $60 per barrel. Certainly, record oil inventories suggest a significant
rise in 2016 is highly unlikely, but expected stronger economic growth should pull prices up from
current levels later next year,” Pearce said.
Fuel is such a large cost that it focuses intense effort in the industry to improve fuel efficiency,
through replacing fleet with new aircraft, better operations and efforts to persuade governments to
remove the airspace and airport inefficiencies that waste around 5% of fuel burn each year.
“We forecast that fuel efficiency, in terms of capacity use i.e. per available tonne kilometres (ATK)
will improve by 1.8% in 2016. Continued fuel efficiency gains have partially decoupled carbon
dioxide emissions from expanding air transport services.
"In the absence of the expected fuel efficiency gain this year, fuel burn and CO2 emissions would
be 1.8% higher in 2016. That represents a saving of over 14mn tonnes of CO2, as well as saving
on fuel that would have cost the industry and its consumers an additional $2bn,” Pearce added.

How low can oil prices go? Opec and El Niño take a bite out of crude's cost
The Quardian - Debbie Carlson
As the price of crude plummets to its lowest level in nearly a decade, analysts point to Opec’s recent
‘disarray’ and a warming weather pattern as the main culprits – and think we have yet to see the bott
Crude oil prices fell to their lowest levels since the 2007-08 global financial crisis this week, and
further losses could be in the cards as the factors that led to lower values remain in force.
Following the decision on 4 December by the Organization for Petroleum Exporting Countries
(Opec) to continue its strategy to seek market share rather than support prices, US crude oil
values broke under $40 a barrel.
That sent values to their lowest levels since December 2008, when the front-month West Texas
Intermediate crude-oil futures price fell to around $34. On Thursday, prices were trading at around
$36.75 for the January futures contract.
Oil market participants said it wasn’t so much Opec’s decision to keep their year-old market share
strategy, rather the signs of disorder in the cartel that led to the renewed selling in crude oil.
“Opec’s complete disarray was a factor. What I mean by complete disarray is they couldn’t even
act like adults. It was a circus. There were leaks. They didn’t put out a communiqué, then a
(disorganized) press conference.
This was not a cohesive organization. Most people didn’t expect much out of the meeting. The
disarray was more profound than the actual decision,” said Jay Hatfield, co-founder and president
of Infrastructure Capital Advisors and portfolio manager of the InfraCap Active MLP exchange-
traded fund.
The market-share strategy is mostly a decision by Saudi Arabia, the biggest and economically
strongest member of the cartel, to try to crush non-Opec production, much of it from US shale-oil
producers.
While the strategy is working as US oil output is slowing, it’s come at great pain for economically
weaker oil states like Venezuela and Nigeria. These cartel members want higher prices – but the
issue is no one wants to cut their own production. They still want Saudi Arabia to be the swing
producer. The Saudis don’t want to go it alone which has led to the discord, said Brian Kessens,
portfolio manager and managing director at Tortoise Capital.
“The idea that Opec may curb production sometime in the near future went out the window. That’s
the reason you saw some of the weakness, especially Monday,” he said.

Not only did US prices fall under $40 this week but so did the global benchmark Brent crude oil
prices, for the first time since February 2009. The global supply glut of about 1.5m barrels per day
is the driving factor behind the lower oil prices, with much of that overproduction because of
Opec’s opening the spigots.
Hatfield said there’s another factor behind the new drop in oil prices: warm weather.
“The fact that you can
almost go swimming in
New York City right now is
horrible. Absolutely
horrible [for heating oil
demand]. To me, that’s
the straw that is breaking
the camel’s back. We’re
ground zero for fuel oil
demand,” he said.
The El Niño weather
phenomenon can bring
milder winter weather to
the northern part of the
US, and that’s been seen
in places like New York and Chicago, where December temperatures are above normal, reducing
heating demand.
If Opec’s disorganization continues and temperatures stay mild, that could add further pressure to
prices, he said. It’s hard to call a bottom. It’s like catching a falling knife. Just let the knife fall to
the side and pick it up later
Daniel Pavilonis, RJO Futures “I thought prices would have stabilized in the $40 to $50 area, but
… now it could be $35 to $40,” he said. A few factors could influence oil, such as next week’s
Federal Reserve’s monetary policy meeting, where the Fed may raise interest rates for the first
time in seven years.
That could give the dollar another boost, and Kessens said the greenback’s strength has hit oil
since it is dollar denominated. Next week is the last full trading week of 2015, so there could be
some book squaring as investment managers close up accounts before the holidays when trade
volume dwindles.
“I see prices going lower. I wouldn’t be surprised if we saw an uptick from here next week, maybe
to the $40s, but then see a sharp decline, a sell-off below $35. There’s so much supply out there. I
think [prices are] going to be lower than people will perceive,” he said.
Taking out a level that’s held for so long could be jarring and may have a snowball effect, he said.
On the other hand, there is likely to be some opportunistic buying simply because prices are so
low. Pavilonis didn’t rule out a dip under $30 a barrel, but just how far prices may go is hard to
determine.
“It’s hard to call a bottom. It’s like catching a falling knife. Just let the knife fall to the side and pick
it up later so you don’t get hurt,” he said.

NewBase Special Coverage
News Agencies News Release 01 Dec.. 2015
By 2020, Ford To Invest $4.5 Billion In Electric Vehicles
WN.com, Jack Durschlag
Ford Motor Co. will pave the way for more electric cars and hybrids to share the road with
gasoline-based models byinvesting $4.5 billion in electrified vehicles that have thus far failed to
attract U.S. buyers as fuel prices drop, a published report said.
"It’s (electrified vehicles) a significant investment, but it’s the way the industry is moving
forward.” – Michelle Krebs,
senior analyst at
AutoTrader.com
Speaking at a news
conference in Dearborn,
Mich. Thursday, Chief
Executive Officer Mark Fields
said the automaker will add
13 electric cars and hybrids
by 2020, Bloomberg News
reported. The additional
models will raise Ford’s
lineup stake from its current
13 percent to 40 percent in
the next four years and will
include a new Ford Focus
model with a fast-charge
capability, Ford said.
“We’re going to see more
and more companies invest in electrified vehicles because at the moment there’s some very
stringent 2025 emission standards,” said Michelle Krebs, senior analyst at AutoTrader.com. “The
way to get there is using electrification. It’s a significant investment, but it’s the way the industry is
moving forward.”
The auto giant is not alone in the industry as sluggish auto figures through November reveal
automaker’s deliveries tumbled for Ford, Toyota, General Motors and Nissan for electronic
vehicles, according to Autodata Corp.
Over the next five years, Ford's estimated total capital expenditures and spending on
research and development will be about $70 billion. – Matt Stover, analyst at Susquehanna
Financial Group
Fields said plug-in hybrids will be the fastest-growing type of electric vehicles. Matt Stover, an
analyst at Susquehanna Financial Group agreed.

“When you look at these investments, we know for sure hybridization is going to be a bigger
proportion of our vehicles,” Stover said. Over the next five years, he added, Ford’s estimated total
capital expenditures and spending on research and development will be about $70 billion.
The planned outlays for electrified vehicles will be its largest ever in a five-year period, Ford said
in a statement.

NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Your partner in Energy Services
NewBase energy news is produced daily (Sunday to Thursday) and
sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscription emails please contact Hawk Energy
Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
Mobile: +97150-4822502
khdmohd@hawkenergy.net
khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with a total of 25 years of experience in
the Oil & Gas sector. Currently working as Technical Affairs Specialist for
Emirates General Petroleum Corp. “Emarat“ with external voluntary Energy
consultation for the GCC area via Hawk Energy Service as a UAE
operations base , Most of the experience were spent as the Gas Operations
Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility &
gas compressor stations . Through the years, he has developed great
experiences in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of supply routes. Many years were spent drafting, &
compiling gas transportation, operation & maintenance agreements along with many MOUs for the
local authorities. He has become a reference for many of the Oil & Gas Conferences held in the
UAE and Energy program broadcasted internationally, via GCC leading satellite Channels.
NewBase : For discussion or further details on the news above you may contact us on +971504822502 , Dubai , UAE
NewBase 14 December 2015 K. Al Awadi

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