U.S. unveils plan to manage huge Alaskan oil reserve

The U.S. federal government has announced a plan to manage energy drilling on part of Alaska's North Slope, with the 23-million-acre National Petroleum Reserve to be divided between areas available for oil and gas leases and those that are protected from development.

The announcement by U.S. Interior Secretary Ken Salazar followed the completion of an environmental impact study, which recommended development of areas that contain about 72 percent of the estimated "economically recoverable" oil in the reserve.

The move drew criticism from Alaska Sen. Lisa Murkowski, who said the Obama administration had not gone far enough to open up oil and natural gas resources in the area.

Salazar said the plan as conceived would allow for the potential construction of pipelines carrying oil or gas from operations in the Chukchi and Beaufort Seas through the NPR region, also known as the Western Arctic Reserve.

The "balanced approach" would help protect "significant caribou herds, migratory bird habitat and sensitive coastal resources that are critically important to the culture and subsistence lifestyle of Alaska Natives," Salazar said.

The administration has authorized 177 oil and gas leases in the reserve since May 2011, covering some 1.4 million acres. So far only exploratory drilling has occurred.

Under the blueprint 11.8 million acres would be open for development, which are estimated to hold 549 million barrels of economically recoverable oil and 8.7 trillion cubic feet of economically recoverable natural gas.

Oil rises above $108 on hopes for US budget deal

Brent crude oil rose above $108 a barrel on signs of progress in talks to resolve a U.S. budget crisis, easing fears the world's top oil consumer could tip into recession.

President Barack Obama made an offer to Republicans that included a major shift in position on tax hikes for the wealthy, leaving lower tax rates in place for everyone earning less than $400,000. Oil and other riskier assets rose after the U.S. president moved away from the $250,000 threshold that Democrats have been demanding for months.

Brent crude rose 60 cents to $108.24 a barrel. U.S. crude oil gained 31 cents to $87.51 a barrel. Brent crude has traded between $104 and $112 since November, pressured by concerns the United States will not reach a deal on the so-called "fiscal cliff" before the end of the year, triggering automatic tax hikes and spending cuts.
The oil minister of Saudi Arabia said the market was well balanced, with prices above $100 a barrel, a level the world's largest exporter has tried to achieve by adjusting production levels over the past two years. Average Brent crude prices have been relatively stable over the past two years, though they have at times spiked towards $120 and above as supplies from the Middle East have been disrupted by the Arab Spring and as Western sanctions have cut Iranian oil exports.

U.S. extends waivers on Iran sanctions to China and India

The United States has granted 180-day waivers on Iran sanctions to China, India and a number of other countries in exchange for their cutting purchases of oil from the Islamic Republic.
President Barack Obama's administration has now renewed waivers for all 20 of Iran's major oil buyers, after granting them to Japan and 10 European Union countries in September. The action was the second renewal for all 20 after Obama signed the sanctions into law a year ago.
The sanctions aim to choke funding to Iran's nuclear program, which the West suspects is enriching uranium to levels that could be used in weapons. Tehran says the program is for civilian purposes.
"The United States and the international community remain committed to maintaining pressure on the Iranian regime until it fully addresses concerns about its nuclear program," Secretary of State Hillary Clinton said in a statement. Clinton also granted waivers, known as "exceptions," on to South Korea, South Africa, Turkey, Sri Lanka, Malaysia, Singapore and Taiwan.
Under the sanctions law, banks in countries that buy oil from Iran can be cut off from the U.S. financial system unless their purchases decline.
Iran's oil exports have fallen 50 percent this year in the face of U.S. sanctions and a EU embargo that began on July 1. That has cost Iran up to $5 billion a month and led to a plunge in Iran's currency, the rial.
Critics of the U.S. sanctions say they will not rein in Iran's nuclear program unless they are accompanied by adequate diplomacy.

Oil Price: US lauds Saudi

The White House has lauded comments by Saudi Arabia's energy minister that consumer nations need not release emergency petroleum reserves to calm oil prices.

Saudi Arabia's Oil Minister Ali al-Naimi said in a statement on Sept. 10 that the world's largest crude exporter was concerned about high oil prices, would take steps to moderate them, and would meet any additional demand from its customers. The kingdom would continue to work with other Gulf Cooperation Council countries and with OPEC to defend the stability of the oil market, Naimi said.

High US oil prices, which hit more than $100 a barrel, the loftiest since May 4, have led industry watchers to guess whether President Barack Obama will tap the Strategic Petroleum Reserve (SPR) ahead of the Nov. 6 election.

The White House reiterated it was keeping all options on the table to calm prices, but also applauded Naimi's comments.

Brent hits 3-month high above $114

Brent crude rose above $114 per barrel to its highest in more than three months as Israel's comments on stopping Iran from proceeding with a disputed nuclear programme stoked worries about a disruption in supply from the region.

Prime Minister Benjamin Netanyahu had said that most threats to Israel's security were "dwarfed" by the prospect of Iran obtaining nuclear weaponry. Those comments overshadowed recent forecasts of a further slowdown in oil demand growth due to a weak economic outlook in the United States and Europe. The debate in Israel whether to go to war against Iran over its nuclear programme intensified during the weekend, worrying oil investors who see it as defying appeals by U.S. President Barack Obama to allow more time for international diplomacy.

Brent crude, which hit $114.28 -- its highest since May 4, traded 41 cents up at $113.36 a barrel by 0635 GMT, gaining for six out of the past seven sessions. U.S. oil rose 18 cents to $93.05, after ending 49 cents lower at $92.87.