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BRENT WTI MOVE UP ON PROMISE OF US-CHINA TRADE TALKS

BRENT WTI MOVE UP ON PROMISE OF US-CHINA TRADE TALKS

06 September 2019

Brent Oil Futures was up 0.13% at $61.03 a barrel, as of 12:40AM ET (04:40 GMT), while Crude Oil WTI Futures was up 0.12% at $56.37 a barrel. The EIA...

PRAISE SINGERS  GO TO "GREET" NEW  GMD NNPC

PRAISE SINGERS GO TO "GREET" NEW GMD NNPC

04 August 2019

If journalism is to have meaning, to fulfill its raison d'etre, then it must be about speaking truth to power; giving a voice to the voiceless. The National Chairman of...

IS IT A NIGERIAN GAS FLARE COMMERCIALISATION PROGRAM ?

IS IT A NIGERIAN GAS FLARE COMMERCIALISATION PROGRAM ?

31 July 2019

The Nigeria Gas Flare Commercialisation Programme (NGFCP) is a prime example of a project well concieved but poorly executed and unlikely to achieve most of its objectives despite its inherernt...

VR CAPITAL BUY 25% OF P&ID AS NIGERIA FACE $9BN FINE

VR CAPITAL BUY 25% OF P&ID AS NIGERIA FACE $9BN FINE

05 June 2019

First, a health warning. This article is about recalcitrant, inept and quite possibly corrupt Nigerian politicians and government ministers. It is certainly about incompetence and misconduct in public office. It...

DISASTER AS UNEMPLOYMENT LEAPS BY 30%  TO 20.9m

DISASTER AS UNEMPLOYMENT LEAPS BY 30% TO 20.9m

29 May 2019

Nigeria is sleepwalking into a disaster which has the potential to unleash instability, insecurity and crippling hardship. Unemployment is always a cause for concern, it is the clearest indication that...

 NIGERIA NGIGE UNDEREMPLOYED OR UNEMPLOYABLE?

NIGERIA NGIGE UNDEREMPLOYED OR UNEMPLOYABLE?

08 May 2019

Working on the assumption that the Minister of Labour and Employment, Senator Chris Ngige has not been misquoted it is difficult to understand his recent pronouncement and what now seems...

NIGERIA ANOTHER MOU ANOTHER DAY

NIGERIA ANOTHER MOU ANOTHER DAY

01 May 2019

Nigeria has announced ambitious plans to double its oil production by 2025, targetting 4 million bpd in six years’ . Maikanti Baru, Group Managing Director at the Nigerian National Petroleum...

NNPC REFINERY WOES 2019

NNPC REFINERY WOES 2019

24 April 2019

The Nigerian Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, has not unpredictably, stated that Nigeria’s continuous subsidy of petrol consumption means the Nigerian National Petroleum Corporation (NNPC) will...

NIGERIA OPEC STAND FIRM

NIGERIA OPEC STAND FIRM

28 March 2019

Nigeria and other member countries of the Organisation of Petroleum Exporting Countries (OPEC) as well as their non-OPEC allies led by the Russian Federation have said they are committed to...

PALM OIL PRODUCTION UNDERPERFORMS

PALM OIL PRODUCTION UNDERPERFORMS

18 March 2019

PALM OIL PRODUCTION A MEAGRE PERFORMANCE Nigeria from gaining a substantial share of the global oil palm industry now worth $62 billion annually, casting doubts on government’s ability to grow...

NIGERIA REFINING THE VISION

NIGERIA REFINING THE VISION

18 March 2019

NIGERIA REFINING THE VISION Nigeria is the only OPEC member country that imports gasoline (PMS) and holds the dubious distinction of being the largest importer in the world. The Nigerian...

IS THE PGB FATALLY FLAWED?

IS THE PGB FATALLY FLAWED?

18 March 2019

IS THE PIGB FATALLY FLAWED? Ten years after the Petroleum Industry Bill began its tortuous odyssey which has included the Bill being broken into four portions, both houses of the...

CBN PUMP UP THE T-BILLS

CBN PUMP UP THE T-BILLS

18 March 2019

CBN PUMP UP THE T-BILLS The Central Bank of Nigeria (CBN) plans to raise a total of N1.809 trillion from the debt market, in the first quarter of 2019.This is...

TIN EXPORTS NIGERIA

TIN EXPORTS NIGERIA

17 March 2019

TIN EXPORT NIGERIA Synterra are able to export high grade tin ore from Nigeria. We agregate the Mining production of a number of artisanal miners and consolidate volumes for exportSynterra...

BERYLLIUM MINING OPPORTUNITIES

BERYLLIUM MINING OPPORTUNITIES

17 March 2019

The Nigeria Solid Mineral and Mining Sector has in effect made the great leap forward which will now allow investors to take advantage of the vast mineral potential Nigeria possess....

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Monday, 18 March 2019 00:13

CONGRESS PONDER NOPEC

Written by Femi Ogunkolati

US PONDER NOPEC

nevitably aided and abetted by increases in oil prices and a US President who has been a long term critic of OPEC, the No Oil Producing Exporting Cartels (“NOPEC”) Act has re emerged . The act seeks to hold OPEC member states liablefor violations of U.S. antitrust legislation  by removing their sovereign immunity shield for what is deemed as OPEC’s collusive behaviour in its attempts to limit global crude oil production to manipulate price outcomes. The NOPEC bill is a re-incarnation of legislative attempts that have variously been abortively  introduced over 15 times since 1999. he NOPEC bill passed by the House Judiciary Committee last month could go to the floor this summer for a full vote. A different bill in the Senate also seeks to rein in OPEC by opening the door to complaints at the World Trade Organization if OPEC continues to pursue its policy of production cuts as a means to support oil prices.

 Courts have repeatedly refused to rule on suits against OPEC member states, citing sovereign immunity and the Act of State Doctrine, and have dismissed suits against companies dealing with OPEC for the reasons. US Federal courts have long relied on these principles to reject antitrust legislation against OPEC or OPEC members,Despite what appears to be overwhelming bipartisan enthusiasm in Congress for the bill, previous administrations  of both President Bush and Obama been reluctant  to turn over to the courts functions that have traditionally belonged in the executive and have preferred to use diplomacy in engaging OPEC. Furthermore such a bill would likely provoke the negative outcomes and increase in oil prices which it was meant to control. Both the American Petroleum Institute and American oil companies oppose the legislation

 

Treasury Secretary Henry Paulson under President George W. Bush asserted that the adoption of such a law would threaten foreign direct investment in the US, as OPEC countries might withdraw assets for fear they would be seized. This divestment would harm the U.S. economy and would almost certainly spur retaliatory measures against American-held assets abroad.

 

Indeed NOPEC legislation would almost certainly trigger  punitive retaliatory action against U.S. commercial and political interests. This would likely be in the form of seizing  the assets of U.S. energy companies operating abroad, and the dissolution of Joint Ventures with National Oil companies of member states. NOPEC’s central tenet of attempting to conduct US foreign policy by litigation in all likelihood will have the reverse effect of a stable low price oil regime.

 

The significant difference is that President Trump who for decades has railed against OPEC and its influence in global oil market pricing is more likely to back it than any of he predecessors. OPEC has also changed and for now it is OPEC+ with Russia playing an increasing role in setting production quotas. The political ramifications are complex. They include the effect that such legislation will have on the real ‘special relationship’ between US and their critical ally in the Middle East, Saudi Arabia.

 

OPEC was formed in 1960 at a time of decolonization in an era of Western domination of the oil market with a  mission of coordinating and unifying the  petroleum policies of the members of the organization and ensuring that member countries have a stable oil market to ensure that they could  secure regular, economical and efficient supply of petroleum to the countries consuming the products and gaining  fair capital to be invested back in the petroleum industry.

 

Most of the member states are currently experiencing economic, social and political distress. In a world where non OPEC oil supply has grown substantially, reducing the call for OPEC  crude even in an expanding market, there is a determination on the part of OPEC to achieve an optimal price level which will provide member states with the best return without negatively impacting  global economic growth and destroying demand.

 

US foreign policy has become more militant and unilateral in it use of sanctions and extra territorial jurisdiction. How would NOPEC work globally ? It is one thing for the U.S. to invoke economic interests or other grounds as a rationale to impose punitive legal sanctions on a country, It is quite another for the U.S. to use extraterritorial sanctions to block trade and financial activities by non-U.S. parties with those countries — in other words, to coercively turn national actions into global measures, in breach of the sovereignty of other states. After all the US is not the sole importer of oil.

 

Through extraterritoriality, the U.S. aims not only to control OPEC member states economic affairs, but also to advance its own geopolitical and commercial interests. In the event that such a bill increases the price of oil are other consumers expected to take the hit?In the past, few international players were willing to flout U.S. extraterritorial sanctions for fear of being barred from the U.S. financial system. But Trump’s aggressive unilateralism on matters extending from trade and global warming to Iran and OPEC is beginning to create pushback to US intent on using the control of the reserve currency and its enormous financial capacity for its own self interest

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