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Ithaca starts up production from Stella field

Ithaca Energy Inc., Aberdeen, reported the successful startup of oil and gas production from Stella field in the central North Sea. Stella field comprises the Stella Andrew sandstone reservoir containing light oil and rich gas-condensate and the Stella…


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North Korea’s Regime In Jeopardy As China Bans Coal Imports

On Saturday, China said that it was suspending all imports of coal from North Korea as part of its effort to implement United Nations Security Council sanctions aimed at stopping the country’s nuclear weapons and ballistic-missile program. The ban, according to a statement posted on the website of the Chinese Commerce Ministry, takes effect on today and will last until the end of the year. While China will hardly suffer material adverse impacts, Chinese trade – and aid – have long been a vital economic crutch for North Korea, and the decision…



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Prospects For A Quick Obamacare Repeal Are Fading Fast

Back on January 12th, 8 days before Trump even officially moved into the White House, the prospects of a quick repeal and replacement of Obamacare were looking really good when the Senate voted 51-48 to instruct key committees to start drafting legislation to do away with Obama’s crowning “achievement”.  In fact, that early January budget resolution required lawmakers to submit repeal proposals for consideration by January 27th, a lofty goal, but welcome news to conservative voters around the country that were eager for a quick unwind of the controversial legislation.

Alas, today, nearly a full month after the original deadline of January 27th, no replacement plan has been officially introduced and even Trump admits “maybe it will take till sometime into next year, but we are certainly going to be in the process…it’s very complicated.”

Speaking to a crowd in Florida over the weekend, President Trump said that a replacement plan would be introduced within “a couple of weeks” but steered clear of commentary on when such a plan could be expected to be implemented.  Per The Hill:

“We are going to be submitting in a couple of weeks a great healthcare plan that’s going to take the place of the disaster known as ObamaCare,” he said at a campaign rally in Melbourne, Fla. “It will be repealed and replaced.”

 

“Just so you understand, our plan will be much better healthcare at a much lower cost,” he added. “OK? Nothing to complain about.”

Trump: We will submit “a great health care plan that’s going to take the place of the disaster known as Obamacare” https://t.co/cZogIonewA

— CNN Politics (@CNNPolitics) February 18, 2017

 

Meanwhile, a daily tracking poll from Good Judgement pegged the odds of a quick repeal of the individual mandate at 65% back in mid-January, when the Senate passed its budget resolution, but those odds have since dropped to just 35% as the prospects of a long, drawn out repeal are looking more likely with each passing day.

Obamacare Repeal

 

So why are Republicans finding it so difficult to repeal and replace Obamacare?  Some cite general dysfunction within the Trump administration and/or a fundamental difference of opinion between Trump’s policy advisors and economic experts.  Per Axios, a recent photo tweeted out by Reince Priebus added fuel to the cabinet “dysfunction” fire when it revealed that a recent “repeal and replace” meeting included several members of Trump’s health care and policy teams but not a single representative from Treasury.

Members of the Trump administration got together on Sunday to talk about President Trump’s plan to repeal and replace Obamacare — but a photo tweeted by White House chief of staff Reince Priebus doesn’t show any Treasury Department officials at the table, despite the likelihood that the plan will involve big tax changes.

 

At the table were many members of the president’s health care and policy teams, including Department of Health and Human Services Secretary Tom Price, yet-to-be confirmed Centers for Medicare and Medicaid Services head Seema Verma, and White House aide Stephen Miller.

 

But no one from the Treasury Department was there, and a source who heard about the snub from a White House economic adviser said the department feels shut out of the process.  “There’s always tension between health policy folks and economic policy folks in any administration, but this is an entirely different level.” 

Great meeting this morning on @POTUS plan to repeal & replace Obamacare. The American people deserve much better, and they will get it. pic.twitter.com/2GQpygenJ3

— Reince Priebus (@Reince45) February 19, 2017

 

That said, Goldman’s macro team recently provided an alternative explanation that revolves around, among other things, arcane procedural limitations in Congress (see “The Honeymoon Is Over: Goldman Slams Trump’s Economic Plan, No Longer Expects A Border Tax“):

The original strategy of Republican congressional leaders was to repeal major aspects of the law using the budget reconciliation process, which allows certain fiscal legislation to pass with 51 votes in the Senate, i.e., only Republican support, and to follow this with separate legislation to establish a replacement program at some later point. The expectation was that the repeal would take effect with a delay, giving lawmakers perhaps two years, until after the midterm election in November 2018, before the new program would actually need to be implemented.

 

This was intended to serve two purposes. First, it allowed for quick passage of an Obamacare repeal bill using the reconciliation process without the inevitable delays associated with devising a replacement plan. An important consideration was that the budget resolution for a given fiscal year allows for only one reconciliation bill for spending and another for taxes. Since the ACA includes spending and tax provisions, repealing it would use up both reconciliation instructions, leaving no opportunity for tax reform. To address this, Congress is likely to pass two budget resolutions this year. The first, for FY2017, is the resolution that would have normally passed last year and passed a few weeks ago. This will allow the reconciliation process for the ACA legislation. Once that bill has passed, Congress is then likely to pass the FY2018 budget resolution, which will actually guide fiscal decisions over the coming year and lay the procedural groundwork for upcoming tax reform and, possibly, infrastructure legislation. The upshot is that procedural constraints dictate that one bill is passed before the other is considered, and the ACA repeal bill was expected to be the easier task and therefore came first.

 

The second reason for the repeal and replace strategy was that Republican leaders hope to gain bipartisan support for the “replacement” legislation, because it would give the program a greater political mandate than the ACA had—reducing the likelihood that Republicans alone are held accountable for any future problems—and because some of the desired changes are regulatory rather than fiscal in nature and thus cannot be made through the budget reconciliation process, necessitating separate legislation that would require 60 votes in the Senate.

 

However, several Republican senators have objected to this two-stage approach, instead calling for at least some aspects of the “replacement” plan to be included in repeal legislation. While individual lawmakers’ motivations likely differ, among the concerns raised have been the potential problems in the insurance market that prolonged uncertainty regarding the replacement plan would cause, and the possibility that no replacement would ultimately be enacted, leaving some current enrollees without coverage.

So how will the Obamacare repeal process play out…

In our view, Republican leaders have two basic options. First, they could attempt to pass a partial reform of the program—stopping short of a true replacement—through the reconciliation process, with the expectation that it could constitute a sufficient reform once combined with administrative and regulatory changes the Administration can make without Congress. On the legislative side this could include, for example, increasing state flexibility with regard to the Medicaid expansion, and revising the distribution of the refundable tax credits used to finance coverage in the private market, combined with funding for a high risk pool for higher cost enrollees. On the administrative side, this might include changes to required benefits and changes in the regulation of premiums.

 

A second option would be to pause the work on Obamacare repeal and to address it at a later date, during or after the tax reform debate. However, while this might allow Congress to focus on tax reform and other areas that might be of greater significance to financial markets, it would create political problems, as many Republican lawmakers continue to be very focused on repeal.

Campaign promises, meet Washington D.C. realities….

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Shell: Global LNG demand to rise 4-5%/year to 2030

Global demand for natural gas is expected to increase 2%/year between
2015 and 2030, with LNG demand expected to rise at twice that rate at
4-5%/year, according to Royal Dutch Shell PLC’s first LNG Outlook.



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The Natural Gas Market 2-20-2017 (Video)

By EconMatters


We discuss the fundamentals and technicals of the natural gas market in this video. A very mild winter with a year end run up in natural gas prices has led to quite the position unwind in this commodity. We have more Natural Gas Rigs than a year ago which could bring more future NatGas supply to market. Natural Gas bulls better hope for a very hot summer with air conditioners running at peak demand levels. Gotta love the Natural Gas Market; one of the few markets left that react to fundamental news, and not phony QE artificiality!

 

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Middle East petrostates moving beyond <b>crude oil</b>

DUBAI, United Arab Emirates — Middle Eastern countries are weaning themselves off crude oil production and pouring more resources into …The post Middle East petrostates moving beyond <b>crude oil</b> appeared first on crude-oil.news.


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Platts To Include Norway’s Troll Crude In Brent Basket From 2018

S&P Global Platts said on Monday that starting from January 2018, it will include Norway’s Troll crude grade in the Brent basket—a first such addition since 2007—in a bid to ensure that there will be sufficient deliverable North Sea crude reflected in the price assessments. S&P Global Platts explained that Dated Brent—the physical cargoes of crude oil loading in the North Sea on any given day, and with specific delivery dates—is the core component of the Brent complex. The Brent crude complex is linked to physical…


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Fumbling Towards Collapse

Submitted by Howard Kunstler via Kunstler.com,
In all the smoke and fog emitted by Trump and his adversaries, it must be hard to make out the actual issues dogging this society, and even when you can, to find a coherent position on them. This was nicel…

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