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January 6, 2012

Energy Data Highlights

Crude oil futures price 1/4/2012: $103.22/bbl up$3.86 from week earlier up$13.84 from year earlier Natural gas futures price 1/4/2012: $3.096/mmBtu up$0.012 from week earlier down$1.573 from year earlier Weekly coal production 12/31/2011: 19.194 million tons down1.097 million tons from week earlier up0.167 million tons from year earlier Natural gas inventories 12/30/2011: 3,472 Bcf down76 Bcf from week earlier up356 Bcf from year earlier Crude oil inventories 12/30/2011: 327.5 mmbbl up3.9 mmbbl from week earlier down11.9 mmbbl from year earlier Commodities at Close GRAINS, OILSEEDS -- Wheat futures tumbled the most in three weeks on speculation that rains will revive dry fields in South America, boosting prospects for global grain production. Corn futures for March delivery fell 2.3 percent to close at $6.435 a bushel, the biggest drop since Dec. 14. Soybean futures for March delivery declined 1.7 percent to $12.09 a bushel, the biggest drop since Dec. 9. PRECIOUS METALS -- Gold futures rose, capping the longest rally in 10 weeks, after U.K. Defense Secretary Philip Hammond said the country may take military action if Iran carries out its threat to block the Strait of Hormuz. NATURAL GAS -- Natural gas fell to the lowest in more than two years after a government report showed a widening U.S. surplus of the heating and power-plant fuel. CRUDE OIL -- Crude oil fell for the first time in three days as U.S. inventories gained and borrowing costs in France rose, adding to concern that Europe will struggle to contain the debt crisis.

OIL PRODUCTS -- Gasoline fell the most in three weeks as the Energy Department reported that inventories rose to a nine-month high and demand slid the most in 11 weeks. Heating oil futures for February delivery declined 1.7 percent to $3.0388 a gallon, the biggest drop since Dec. 14. http://www.bloomberg.com/news/2012-01-05/raw-sugar-declines-most-sinceseptember-commodities-at-close.html Natural Gas/ Power News Western US to absorb gas displaced by Marcellus Shale production Changing dynamics in the northeastern and western US stand to have lasting implications on natural gas markets in the latter region as pipeline expansions and growing Marcellus Shale production alter traditional flow patterns and link the two markets in a way not previously seen, Platts unit Bentek Energy said in a report released Thursday. http://www.platts.com/RSSFeedDetailedNews/RSSFeed/NaturalGas/87683 29 Natural gas, oil boom spurs sand mining in Midwest The rolling hills and scenic bluffs of western Wisconsin and southeastern Minnesota hide a valuable resource that has sparked whats been called a modern-day gold rush. The object of desire is not gold but a soft sandstone needed by drilling companies to unlock underground natural gas and oil supplies in a controversial practice called hydraulic fracturing, or fracking. Largely overlooked in the national debate over fracking is the emerging fight in the U.S. heartland over mining frac sand, which has grains of ideal size, shape, strength and purity. Mining companies say the work provides good jobs in rural areas, but some residents fear the increase in mining could harm human health and the environment. More and more people are waking up to the fact that there are difficulties with this massive explosion, said Pat Popple, a retired school teacher and principal and anti-sand mining activist. http://fuelfix.com/blog/2012/01/06/natural-gas-oil-boom-spurs-sand-mining-inmidwest/ Development problems force Venezuela to extend natural gas imports Venezuela's inability to develop its natural gas industry as planned has forced it to revise and extend a deal with Colombia's state-controlled Ecopetrol and Chevron involving gas imports from the partners' Guajira gas field in northeastern Colombia, a Caracas-based consultant said Wednesday. http://www.platts.com/RSSFeedDetailedNews/RSSFeed/NaturalGas/8761867 Capacity deliverability, reliability separate concerns, PJM tells FERC Although the Midwest Independent Transmission System Operator has told federal energy regulators that there needs to be more capacity deliverability between itself and the PJM Interconnection because of future generator retirements in MISO, PJM disputed that view Thursday. MISO's linkage of the capacity deliverability issue and generator retirements due to environmental rules is "tenuous at best," PJM Senior Vice President Michael Kormos told the US Federal

Energy Regulatory Commission in Thursday comments. http://www.platts.com/RSSFeedDetailedNews/RSSFeed/ElectricPower/8768331 EIA Storage Release 1/5/12 (Actual): -76 Previous Week: -81 Bcf +11.4 % Change from 1 Year Ago +15.2% Change 5-year Average Green/ Alternative Energy News Growth in Renewable Energy Installations A recent study paints an encouraging picture for the renewable energy industry, and finds that the value of renewable energy installations worldwide will double over the next 20 years. Bloomberg New Energy Finance valued global renewable energy installations in 2010 at $195 billion in its Global Renewable Energy Market Outlook, released in November 2011. The report projected that figure to increase to $395 billion by 2020 and $460 billion by 2030. In addition, renewable energy will represent 15.7 percent of total energy production by 2030, an increase from 12.6 percent in 2010, said the report. Europe is leading the global shift in energy usage, but the United States will catch up by making $50 billion worth of investments in the next 10 years http://www.green-buildings.com/content/782147-renewable-energy-installationsdouble-2030-implications-green-jobs Crude Oil News OPEC Daily Basket Price 1/5/2012 N/A (OPEC Daily Basket Price 1/4/2012- $111.73) Crude Oil Futures Head for Weekly Gain on U.S. Economy, Iranian Tensions Oil headed for a weekly gain in New York on signs that the U.S. economic recovery is gaining momentum and concern that tensions with Iran may lead to a disruption in Middle East exports. West Texas Intermediate futures have advanced 3.4 percent this week. Hiring in the U.S. probably accelerated in December for a second month, pointing to a strengthening labor market heading into 2012, economists said before a report today. The European Union is working to halt oil purchases from Iran, said Victoria Nuland, a U.S. State Department spokeswoman. European foreign ministers aim to announce harsher penalties on the Persian Gulf nations energy and banking industries at a meeting Jan. 30, according to EU spokesman Michael Mann. http://www.bloomberg.com/news/2012-01-06/crude-oil-futures-head-for-weeklygain-on-u-s-economy-iranian-tensions.html

Screws tighten on Iran as big buyers shun its oil Iran faces the prospect of cutbacks in its oil sales to China and Japan as new measures to block Tehran's crude exports over its nuclear programme appeared to be driving its economy to the wall. The developments in Asia on Thursday followed news 24 hours earlier that EU leaders had agreed to halt European purchases of Iranian crude. http://www.commoditiesnow.com/commodities-nowreports/general/9525-screws-tightenon-iran-as-big-buyers-shun-its-oil.html Seoul and Tokyo seek to ease Iran oil ties Japan and South Korea are seeking new suppliers of crude oil to lessen their dependence on Iran, in response to US pressure to stop buying from the country. The move comes as Tehran has threatened to block the Strait of Hormuz, through which a third of the worlds seaborne oil trade passes, if the west imposes oil sanctions against it. http://www.ft.com/intl/cms/s/0/e77a518e-37a3-11e1-a5e000144feabdc0.html#axzz1igT3olPl Refinery closures raise fears on oil prices Growing tension with Iran and a threat to global crude supplies may be dominating oil traders attention but a potentially bigger story is breaking on the demand side of the market. Petroplus, Europes largest independent refining company, this week began shutting down three of its five refineries, halting about a quarter of a million barrels of daily production. The move by the refiner follows plans by other operators to mothball half the refining capacity on the US Atlantic coast. Since the 2008-09 financial crisis, 2.6m barrels a day of capacity has disappeared from advanced economies, according to the International Energy Agency. More closures are coming. These decisions will have a lasting impact on petroleum markets, say analysts. Refineries are the main customers for the worlds oil producers. Shutting down one plant reduces demand for the types of crude oil it uses if other refineries do not fill the gap. http://www.ft.com/intl/cms/s/0/09728c00-37ab-11e1-a5e000144feabdc0.html#axzz1igT3olPl Oil price drops below $103 a barrel after government reports unexpected supply increase Oil and natural gas prices dropped Thursday after the government said the U.S. ended 2011 with little need for more fuel. Heres how energy contracts traded. http://www.washingtonpost.com/business/markets/oil-price-drops-below-103-abarrel-after-government-reports-unexpected-supplyincrease/2012/01/05/gIQAckhHdP_story.html Oil executives meet with Alaska gov. on pipeline

Shipping to Asia-Pacific markets may be the best way to commercialize the natural gas at Alaskas prodigious North Slope, the chief executive of ConocoPhillips said after meeting the states governor. To do that, the company would like to build a pipeline from the North Slope to a liquefied natural gas plant in the middle part of the state to prepare the gas for export, ConocoPhillips CEO Jim Mulva told reporters in Anchorage. Alaskans have long hoped for a gas line as a way to create jobs, provide more reliable energy and shore up revenues as oil production declines. http://fuelfix.com/blog/2012/01/06/oil-executives-meet-with-alaska-gov-onpipeline/ Petroplus Shares Plunge As Credit Lines Suspended Struggling Swiss-based refiner Petroplus Holdings AG said Thursday it is continuing discussions with its banks to restore financing and avoid bankruptcy, even as it disclosed that all the company's credit lines had been frozen. Petroplus said discussions would continue in "the coming days," but reported that lenders had suspended access to all credit lines under its revolving credit facility, according to a statement. The disclosure indicated a deepening of the financing crisis at the Swiss independent refiner, which has struggled amid terrible market conditions for European refiners. http://online.wsj.com/article/SB1000142405297020347100457714267226095993 2.html?mod=WSJ_hp_LEFTWhatsNewsCollection Supply Buildup Pressures Crude The Energy Information Administration said crude-oil stocks rose 2.2 million barrels in the week ended Dec. 30, while analysts surveyed by Dow Jones Newswires expected a drop of 900,000 barrels. Gasoline stocks rose 2.479 million barrels, more than twice the size of the expected 1.1 million barrel rise and distillate stocks, including diesel and heating oil, rose 3.224 million barrels, more than five times the projected riseThe stock builds came as demand slumped. Use of gasoline, the most widely used petroleum product, fell 4.1% in the holiday week to a two-month low of 8.556 million barrels a day and was 3.4% below a year ago.Total oil demand fell 2.6%, to a five-week low near 18 million barrels a day and was down more than one million barrels a day from a year ago. Demand for distillate fuel (diesel and heating oil) was 7.3% lower in the week and 5.5% below a year ago.The EIA said crude and gasoline stocks ended the year in the upper end of their five-year average level, while distillates were in the middle of the five-year range. "The numbers are bearish, there is no doubt about it," said Carl Larry, an analyst at Oil Outlooks and Opinions. http://online.wsj.com/article/SB1000142405297020351360457714252381895504 2.html?mod=WSJ_Commodities_LEFTTopNews Gasoline prices start the year with a bang Gasoline prices at the pump started the year off with a bang at the highest-ever level for the start of a new year, and analysts expect a particularly volatile 2012. http://www.marketwatch.com/story/gasoline-prices-start-the-year-with-a-bang2012-01-06 Recent Rig Counts Area Last Cou Change from Date of Count nt Prior Count Prior Count Change from Last Year Date of Last Year's

Count U.S. Canada 29 Dec 2007 11 29 Dec 11 221 -1 -185 -12 22 Dec 11 22 Dec 11 October 2011 +313 -25 +55 30 Dec 10 30 Dec 10 November 2010

Internatio Novemb 1185 nal er 2011

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