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THE WALL STREET JOURNAL: Oil-News Roundup 17 May 2006

Oil News Roundup

May 17, 2006

Crude-oil prices recovered on Tuesday from a steep decline, approaching $70 a barrel on the New York Mercantile Exchange. Here is today's well of news about oil and energy.

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ECUADOR DENIES NATIONALIZATION URGE: A day after kicking California's Occidental Petroleum out of the country, Ecuador's government said it had no interest in following in the footsteps of Venezuela and Bolivia and nationalizing its energy industry. Latin America's No. 5 oil producer Monday seized Occidental's assets, raising market fears that a regional nationalization trend begun by Venezuela's Hugo Chavez was continuing. Energy Minister Ivan Rodriguez denied any such desire on the government's part. But the Occidental dispute has been encouraged by leftists in the country, who Tuesday cheered the company's ouster and said nationalization was the next logical step. Occidental shares fell more than 2% today.

BRAZIL: ETHANOL POWERHOUSE? Mr. Chavez's influence in the region might eventually wane, though, if ethanol can help the less-politically inclined Brazil gain economic and diplomatic strength, the Financial Times reports (subscription to required). Brazil is busy perfecting the art of turning its massive sugar supply into ethanol and has vowed to increase its production of the gasoline additive by 40% by 2010. It plans to sell that ethanol, of course, but it also plans to share its technology with other countries, hopefully winning itself diplomatic brownie points in the region and the world.

Japan Gathers Oil Assets: After years of sitting on the sidelines, Japan is starting to gather oil and natural-gas assets around the globe, launching its own exploration and production projects for the first time in years. While its push might increase the world's supply of oil, it could also make oil-exploration services more costly, keeping oil prices high.

In the Clear in Singapore: The Singapore Exchange launched a new clearing facility for trading oil and freight derivatives, called SGX AsiaClear. Singapore's Minister of State for Finance and Transport said it was the first such clearing facility in Asia.

Western Cultural Sites at Risk: Vital archeological and cultural sites in the American West are at risk of destruction because the U.S. Bureau of Land Management is too busy developing federal lands for energy production to protect them, the National Trust for Historic Preservation, a nonprofit group dedicated to protecting historical sites, said.

Two-Wheel Commute: Just in time for National Bike to Work Week, more Americans are riding bicycles, the Associated Press reports. Guess why.

Pawnbrokers Thank Gas Stations: High gas prices are forcing an increasing number of middle-class consumers to pawn their electronics, jewelry, children's toys and other goods, the Chicago Tribune reports.

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