Crude oil going down slow

Crude fell on Monday, with Brent falling toward $107 as investors dumped risky assets over worries about weaker emerging market economies.

The U.S. Federal Reserve is widely expected to cut its bond-buying by another $10 billion at its regular two-day policy meeting starting on Tuesday, which would have knock-on effects for emerging market liquidity.

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Tighter credit conditions in China are also raising fears of a slowdown. Analysts also pointed to concerns over Chinese growth following weaker-than-expected data last week. A Reuters poll showed economists expected Chinese GDP growth to slow to 7.4 percent in 2014 from 7.7 percent in 2013.

Brent crude was down more than $1 to under $107 a barrel. U.S. crude gave up early gains to trade down more than 1 percent to under $96. The weaker Brent price reflected a sell-off in stock markets in Asia and Europe following a hammering for emerging market currencies and bonds last week.

Emerging markets had benefited from investment flows when interest rates in the United States and other developed markets were low. But now that the Fed is changing tack, investors are getting out of the emerging markets with large current account deficits, raising fears over their future economic health.

Trans canada pipe line???

TransCanada Corp. Hardisty Terminal

TransCanada Corp. (TRP)’s proposed Keystone XL pipeline is losing popular support in Canada, a development that could embolden opponents of the project, according to a poll released today by Nanos Research Group.

Canadian support for the $5.4 billion link between Alberta’s oil sands and U.S. Gulf Coast refineries has declined to 52 percent in December from 68 percent in April, while opposition has increased to 40 percent from 28 percent. The survey of 1,000 Canadians taken between Dec. 14 and Dec. 16 has a margin of error of 3.1 percentage points, according to the Ottawa-based agency.

The poll adds to evidence that a push by environmental groups, aboriginal activists and celebrities such as musician Neil Young opposed to big oil projects may be affecting public opinion. President Barack Obama’s government is weighing whether to approve TransCanada’s plans. Canadian Prime Minister Stephen Harper is a strong proponent of the pipeline, a key part of the country’s plans to find new markets for its oil.

The Canadian government “has to be concerned about the erosion of approval in Canada, not just in terms of its impact in Canada but also in terms of the U.S.,” Nik Nanos, president of Nanos Research and Global Fellow at the Woodrow Wilson International Center for Scholars, said in an interview. “This has implications for the anti-Keystone movement in both countries.”

Iran deal help crude prices

Brent crude fell below $107 a barrel on Monday after six nations struck a fresh six-month deal with Iran to curb its nuclear programme and U.S.President Barack Obama urged Congress not to impose additional sanctions on the country.

Crude oil prices trended lower following gains on Friday after weaker-than-forecast U.S.non farm payrolls suggested the Federal Reserve may slow tapering its bond-buying stimulus.

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Brent crude for February delivery was down 50 cents under $107 per barrel. The contract had settled 86 cents higher on Friday. U.S. crude slipped 80 cents to under $92 per barrel, after closing $1.06 higher on Friday.

The highly anticipated U.S. jobs numbers on Friday showed a rise of just 74,000 in December, the smallest increase since January 2011, which suggested the Fed may take it easy in tapering its bond purchases that have boosted liquidity and appetite for risky assets such as oil.

A deal between Iran and six major powers intended to pave the way to a solution to a long standoff over Tehran's nuclear ambitions will come into force on Jan. 20, the Iranian Foreign Ministry and the European Union said on Sunday.Sanctions against Iran over its nuclear programme have kept about 1 million barrels per day of oil off global markets, but an agreement reached Nov. 24 last year raised hopes of a long-term deal that could see Iran resuming full exports.

AMERICAN OIL COMPANIES WANT A CHANGE!!

American oil companies have not been allowed to export crude for 40 years, but the industry wants to change that, even though the U.S. still consumes far more oil than it produces.

A surprising surge in domestic production of light, sweet crude — a particular type of oil that foreign refiners covet — has triggered growing calls to lift the restrictions, which were put in place after the Arab oil embargo of 1973.

But the idea is touching a nerve that remains raw four decades after oil shortages crippled the economy and led to the law that banned crude exports without a special license.

"For 40 years, energy policy has been shaped by that experience of the 1970s," says Daniel Yergin, energy historian, author and vice chairman of the research and analysis firm IHS. "But we are in a different world. Neither our logistics nor our thinking has caught up with the dramatic changes in North America."

Skeptics worry that lifting the restrictions would lead to higher gasoline prices and decreased energy security. Economists and analysts argue that it would have little or no effect on prices, largely because the U.S. already exports record amounts of gasoline and diesel, which are not restricted.

Some experts say allowing crude exports could actually improve energy security by encouraging more domestic production.

Major oil companies such as Exxon Mobil and ConocoPhillips, along with the American Petroleum Institute, an oil and gas lobbying group, are the biggest proponents of ending the ban.

On Tuesday, Alaska Sen. Lisa Murkowski released a paper on energy exports describing the nation's export laws as "antiquated" and urging President Barack Obama and the Senate to allow crude exports. Late last year, Energy Secretary Ernest Moniz suggested at an industry gathering that it may be time to revisit export laws.

But easing the restrictions will be politically difficult, especially in an election year. In a recent letter to Obama, New Jersey Sen. Robert Menendez made an argument that is likely to resonate with voters: "Crude oil that is produced in the U.S. should be used to lower prices here at home, not sent to the other side of the world."

Environmental groups have worries, too, mainly that by allowing U.S. companies to export crude to get higher prices, producers will be able to afford to go after oil deposits that require more elaborate, more environmentally damaging techniques.

That the nation is talking about exporting oil at all is a result of a huge turnaround in domestic production in states such as North Dakota and Texas. The U.S. is producing more crude oil than it has in 25 years, and the government predicts production will approach its 1970 peak of 9.6 million barrels per day in 2016.