Natural Gas

• Reports on surveillance of Americans fuel debate over privacy, security (Reuters)
• Apple to Yahoo Deny Providing Direct Access to Spy Agency (Bloomberg)
• Misfired 2010 email alerted IRS officials in Washington of targeting (Reuters)
• Spy vs Spy: Cyber disputes loom large as Obama meets China's Xi (Reuters)
• When NSA Calls, Companies Answer (WSJ)
• How the Robots Lost: High-Frequency Trading's Rise and Fall (BBG)
• Japan's Pension Fund to Buy More Stocks  (WSJ)
• ‘Frankenstein’ CDOs twitch back to life (FT)
• China’s ‘great power’ call to the US could stir friction (FT)
• Toyota Tries on Corolla Look That’s Just Different Enough (BBG)

• National Security Advisor Tom Donilon resigning, to be replaced by Susan Rice - Obama announcement to follow
• Japan's Abe targets income gains in growth strategy (Reuters), Abe unveils ‘third arrow’ reforms (FT) - generates market laughter and stock crash
• Amazon set to sell $800m in ads (FT) - personal tracking cookie data is valuable
• 60 percent of Americans say the country is on the wrong track (BBG)  and yet have rarely been more optimistic
• Jefferson County, Creditors Reach Deal to End Bankruptcy (BBG)
• Turks clash with police despite deputy PM's apology (Reuters)
• Rural US shrinks as young flee for the cities (FT)
• Australia holds steady on rate but may ease later (MW)
• The Wonk With the Ear of Chinese President Xi Jinping (WSJ)
• Syrian army captures strategic border town of Qusair (Reuters)

Technology, technology, and more technology—this is what has driven the American oil and gas boom starting in the Bakken and now being played out in the Gulf of Mexico revival, and new advances are coming online constantly. It’s enough to rival the Saudis, if the Kingdom allows it to happen. Along with this boom come both promise and fear and a fast-paced regulatory environment that still needs to find the proper balance. In an exclusive interview with Oilprice.com, Chris Faulkner, CEO of Breitling Energy Companies - a key player in Bakken with a penchant for leading the new technology charge—discusses: How Bakken has turned the US into an economic powerhouse; What the next milestone is for Three Forks; What Wall Street thinks of the key Bakken companies; Where the next Bakken could be; What to expect from the next Gulf of Mexico lease auction; What the intriguing new 4D seismic possibilities will unleash; What the linchpin new technology is for explorers; How the US can compete with Saudi Arabia; Why fossil fuel subsidies aren’t subsidies; How natural gas is the bridge to US energy independence; Why fossil fuels shouldn’t foot the bill for renewable energy; Why Keystone XL is important; Why the US WILL become a net natural gas exporter

• BIS lays out "simple" plan for how to handle bank failures (Reuters) - Are we still holding our breath on Basel III?
• Deficit Deal Even Less Likely - Improving U.S. Fiscal Health Eases Pressure for a 'Grand Bargain' Amid Gridlock (WSJ)
• IRS Faulted on Conference Spending (WSJ)
• Deadly MERS-CoV virus spreads to Italy (CNN)
• Turkish PM Erdogan calls for calm after days of protests (Reuters)
• Financial system ‘waiting for next crisis’ (FT)
• Russia to send nuclear submarines to southern seas (Reuters)
• China Nuclear Stockpile Grows as India Matches Pakistan Rise (BBG)

• Record unemployment, low inflation underline Europe's pain (Reuters)
• The ponzi gets bigger and bigger: Spanish banks up sovereign bond holdings by more than 10% (FT)
• California Lawmakers Turn Down Moratorium on Fracking (BBG)
• China’s Growing Ranks of Elderly Beset by Depression, Study Says (BBG)
• Tokyo Prepares for a Once-in-200-Year Flood to Top Sandy (BBG)
• Morgan Stanley Cutting Correlation Unit Added $50 Billion (BBG)
• IMF warns over yen weakness (FT)
• Rising radioactive spills leave Fukushima fishermen floundering (Reuters)
• India records slowest growth in a decade (FT)

A Proxy War Is Raging In Syria

"Since we're dealing with markets that are being manipulated by central bank policies, there is no such thing as economic analysis anymore. All you have is the imaginations of central bankers, and you don't know what they're going to do, so you have to be diversified."

Tesla has been outselling specific Mercedes, BMW and Audi models at similar price/quality points, and Consumer Reports has given the car glowing reviews. Is there a broader meaning in this, other than the introduction of a very well-designed luxury automobile? JPMorgan's Michael Cembalest's suggests that the Tesla’s price and its fossil fuel footprint suggest that it’s a distraction regarding the issue of transportation and related environmental efficiencies.

Canadian Natural Resources Minister Joe Oliver said natural resources are the cornerstone of the federal and provincial economies. The U.S. economy, on the road to modest recovery, remains central to a Canadian oil market that relies heavily on exports. Oliver said at an investment conference in Quebec that the natural resources sector represents about 20 percent of the gross domestic product.  The Canadian economy has suffered, however, because there aren't many new conduits to get oil exports to foreign markets. The potential to reach Asian could provide a relief valve for the Canadian economy, while the option still exists to ship oil through the United States for exports. With opposition mounting along the borders, however, Canada's export-driven economy may become landlocked.

Shale gas is the latest hot potato that is being passed around the world. Are you with the in-crowd or out on limb? Ready to take the dive and place your country’s future in shale gas or go it as usual with domination of our energy sources with the petrol industry?

Moments ago, the British foreign secretary William Hague tweeted that the arms embargo to the Syrian rebels has officially ended. The irony is that as has been known for a long time, and as the FT itself reported ten days ago, the Syrian "rebels" who actually have been Qatari mercenaries, have been receiving weapons shipments for years from the wealthy Persian Gulf country, with the implicit knowledge of both Europe and the US. So why the rush by France and Britain to allow weapons armaments to resume by official channels, even if it means even more weaponization of the Assad regime by Russia and China, more bloodshed, and more death?

Simple: natural gas.

You can see it clear as day in their hedging strategies... Natural gas producers are increasingly bearish on prices for their sector. With more firms hedging, investors looking for upside from rising gas prices need to be careful about where they put their money - especially today. With hedging activity rising the last few years, good deals in the hedge market are getting hard to find.

• The deeper agenda behind "Abenomics" (Reuters)
• BoJ governor Haruhiko Kuroda promises to stabilise bond market (FT)
• Obama Sees Sunset on Sept. 11 War Powers in Drone Limits (BBG)
• Lower CPMs for everyone: FTC Begins Probe of Google's Display-Ad Business (WSJ)
• Apple’s Tax Magic Leaves Irish Bondholders Unmoved (BBG)
• Asia Goes on a Debt Binge as Much of World Sobers Up (WSJ)
• All hail Gazpromia: UK gas supply six hours from running out in March (FT)
• Spain’s banks face €10bn more provisions (FT) ... and then more, and more, and more
• Truck strike may have caused Washington state bridge collapse, officials says (Reuters)
• P&G Says A.G. Lafley Rejoins as Chairman, CEO (BBG)
• Five Key Things About the SAC Insider Case (BBG)

The Arctic is expected to become more important in the coming decades as climate change makes natural resources and transport routes more accessible. Satellite data collected since 1979 shows that both the thickness of the ice in the Arctic and range of sea ice have decreased substantially, especially during the summer months. The melting of the ice facilitates natural resource exploration in the high north. U.S. Geological Survey estimates from 2008 suggest that 13 percent of the world's undiscovered oil and 30 percent of undiscovered natural gas reserves are located in the Arctic Circle. Reflecting the growing interest in the region, the Arctic Council granted six new countries (China, India, Italy, Japan, South Korea and Singapore) observer status during a May 15 ministerial meeting in Kiruna, Sweden.

The Administration simply doesn’t want to get run over by the momentum of the oil and gas industry