1. President Donald Trump revives construction of the Keystone XL and Dakota Access oil pipelines.
It’s not a complete green light yet. President Trump demanded a renegotiation of the construction projects with an emphasis on the use of American-made products. Trump stated, “If we’re going to build pipelines in the United States, the pipes should be made in the United States.”
This decision, signed into effect on Trump’s fourth full day in office, is a major departure from the Obama administration, which rejected the Keystone proposal in 2015 and has continued to block the Dakota Access since. Environmentalists and local Native-American tribes are concerned about climate change and damage to water and land. For the oil industry, this looks to be a positive sign from this administration that they plan to help expand infrastructure and ease transportation bottlenecks.
It is important to note that White House spokesman Sean Spicer said the renegotiation of the Dakota Access project would include key stakeholders, including the Standing Rock Sioux Tribe, which is concerned about Native-American cultural sites and the safety of its water supply.
2. Oil continues its decline on rising U.S. output.
Oil prices extended declines today, pulled down by signs of growing output in the United States that looks to at least partly offset output cuts by OPEC and Russia. London Brent crude for March delivery is down to $55.24 a barrel today (Monday), continuing its drop of 72 cents on Friday. NYMEX crude for March delivery was down 27 cents at $52.90 a barrel. Baker Hughes showed that U.S. drillers added 15 oil rigs last week, bringing the total count to 566, the most since November 2015.
3. India inks deal with UAE to fill crude storage facility.
Last week India signed a deal with the United Arab Emirates allowing the Gulf OPEC country to fill half of India’s underground crude oil storage facility at Mangalore. India announced a series of pacts with the UAE after its Prime Minister Narendra Modi met with UAE’s Crown Prince Sheikh Mohamed bin Zayed al-Nahyan. The deals range from defense and trade, to maritime cooperation and energy.
UAE's Abu Dhabi National Oil Co will store about 6 million barrels of oil at Mangalore, taking up about half of the site's capacity. India is building emergency storage in underground caverns, and stated, “This will ... help to ensure India's energy security and enable us to meet the nation's growing demand for energy,"