Energy briefs May 28

From http://energybulletin.net/ (http://energybulletin.net/30257.html)

Energy Briefs

• Mexico’s trade deficit widened in April as lower oil exports reduced overall export growth and imports expanded at a steady pace. The actual deficit--$781 million—was nearly double the $381 million median estimate in a Dow Jones survey.
• Pemex announced that it produced 3.18 million b/d oil in April, unchanged from March but down from 3.37 million b/d from April 2006. Pemex exported 1.68 million b/d last month compared with 1.78 million b/d in March, and 1.83 b/d in April 2006. About 80% of Pemex's crude exports go to the U.S.
• The EIA now projects a fall in Mexico's output to 3 million barrels a day from a current production of around 3.2 million. That compares with last year's projection by the EIA for an increase to 4 million barrels a day. The EIA particularly pointed to a 14% annual rate of decline in production at Pemex's largest oil field at Cantarell.
• Kuwait unshackled its dinar from the US dollar and switched the exchange rate mechanism to a basket of currencies, throwing plans for currency union with other Gulf Arab oil producers into disarray.
• As oil companies working in the Gulf of Mexico prepare for an active hurricane season, experts say more drilling in deeper waters farther out to sea has made the U.S. more vulnerable to energy disruptions. The GOM is the source of 30% of U.S. domestic oil production and 20% of its natural gas output.
• Dozens of new ethanol plants are planned in the US thanks to federal subsidies and grants. These investments should more than double the annual production of ethanol to 734,000 b/d of gasoline equivalent. Ethanol producers recognize that it is not clear how an additional 20 billion gallons/year of ethanol (President Bush’s goal) would be produced from cellulose or biomass.
• Analysts fear any conflict between Iran and the U.S. could result in the closure of the Strait of Hormuz, through which tankers ship carry about 17 million barrels of crude oil a day — 20% of the world’s daily consumption.
  Sue OPEC? A bill approved by the House last Tuesday would allow our government to sue OPEC members. The bill, which also has strong support in the Senate, would amend antitrust laws to make it illegal for foreign governments to curb oil and natural gas production or control energy prices. [Ed. note: we’re dumbfounded by this bill.]
• Widespread drought in Australia is causing electricity prices to soar as hydroelectric water-storage levels plummet and coal-fired power stations cut output due to lack of water for cooling.
• The Kurdistan Regional Government will block the draft hydrocarbons law in parliament, raising the stakes in a row with the Baghdad government over control of Iraq's oil reserves.
• A subsidiary of Russian-British TNK-BP Holdings could lose its license for the massive Kovykta gas field in Siberia before June 1, a top Russian environmental official warned.
  Iran wants to develop previously untapped oil fields shared with neighboring Iraq, a move that will benefit the two countries, an Iranian oil official said on Saturday. "We hope to start working together. Both countries stand to gain. We would strengthen investment and make the best use of our shared fields." .