Iraqi crude production is now running at 2.3 million barrels per day.

BAGHDAD, Iraq,
Dec. 15--Iraqi oil production is above the levels seen before the US-led invasion of the country in 2003, according to the International Energy Agency (IEA).
The IEA said Iraqi crude production is now running at 2.3 million barrels per day, compared with 1.9 million barrels at the start of this year, added a BBC report.
It puts the rise down to the improving security situation in Iraq, especially in the north of the country.
But the IEA warned that attacks on Iraqi oil facilities remain a threat. In southern Iraq, more than 85 percent of the residents of Basra believe British troops have had a negative effect on the Iraqi province since 2003, according to a BBC poll.
The survey for BBC Newsnight of nearly 1,000 people also suggests that 56 percent believe their presence has increased the overall level of militia violence.
In its latest monthly Oil Market Report, the IEA puts the Iraqi increase in production down to improved security on the main oil pipeline from Iraq’s northern oilfields to the port of Ceyhan in Turkey.
In recent years this pipeline has been out of action for long periods due to sabotage attacks.
Since the summer there has been a marked downturn in all forms of violence in Iraq. Analysts point to a number of reasons for this, ranging from the big increase or ’surge’ in American troop numbers in Baghdad, to Sunni militant groups turning against former al-Qaeda allies.
British forces are due to hand control of security in Basra province to Iraqi forces on Sunday.
The security improvements in Iraq are leading to all sorts of dividends in the country, some of which could be enormously lucrative, said BBC correspondent Crispin Thorold in Baghdad.
Iraq has the third-largest proven oil reserves after Saudi Arabia and Iran, but exports plummeted in the face of the insurgency that flared up following the US-led invasion.
Separately, the IEA said world oil demand would grow faster in 2008 than had previously been expected.
Saying markets were proving resilient to near record-high prices due to continuing strong global demand, the IEA now expects oil demand to increase by 1.2 million barrels per day, 200,000 bpd higher than the previous forecast.

BALI, Indonesia, Dec. 15--A UN climate conference adopted a plan to negotiate a new global warming pact on Saturday, after the United States suddenly reversed its opposition to a call by developing nations for technological help to battle rising temperatures.
The adoption came after marathon negotiations overnight, which first settled a battle between Europe and the US over whether the document should mention specific goals for rich countries’ obligations to cut greenhouse gas emissions.
Upcoming talks, to be completed in 2009, may help determine for years to come how well the world can control climate change, and how severe the consequences of global warming will be.
European and US envoys dueled into the final hours of the two-week meeting over the EU’s proposal that the Bali mandate suggest an ambitious goal for cutting the emissions of industrial nations--by 25 to 40 percent below 1990 levels by 2020.
That guideline’s specific numbers were eliminated from the text, but an indirect reference was inserted instead.
The negotiations snagged again early Saturday over demands by developing nations that their need for technological help from rich nations and other issues receive greater recognition in the document launching the negotiations.
The United States initially rejected those demands, but backed down after delegates criticized the US stand and urged a reconsideration.
“I think we have come a long way here,“ said Paula Dobriansky, head of the US delegation. “In this, the United States is very committed to this effort and just wants to really ensure we all act together. We will go forward and join consensus.“
The sudden reversal was met with rousing applause. UN Secretary-General Ban Ki-moon, who earlier expressed frustration with the last-minute disputes and urged delegates to end the deadlock, praised the United States for showing flexibility in the final hours. “I am encouraged by, and I appreciate the spirit of flexibility of the US delegation and other key delegations,“ he told AP.
In a UN process requiring consensus, both sides won and lost. The broadly worded “roadmap“ doesn’t itself guarantee any level of emissions reductions or any international commitment by any country--only a commitment to negotiate.

MOSCOW, Dec. 15--Russian oil firm Rosneft will follow the lead of Gazprom and LUKOIL to sell crude in rubles amid the ongoing depreciation of the dollar.
“Our specialists are looking at all possibilities that could be beneficial for the company,“ Rosneft Spokesman Nikolai Manvelov said. “Everything depends on economic viability.“
Russia’s largest independent oil producer, LUKOIL earlier announced that the company will switch to the ruble in its gas and crude deals within two years, Bloomberg reported.
“Selling for rubles is much more attractive,“ Deputy Chief Executive Officer Leonid Fedun said on December 12. “Gazprom is considering introducing ruble-denominated contracts and I think that technically Russian companies can do it by 2009 if the banks are ready.“
“We consider the idea of selling our resources for rubles to be quite possible,“ Gazprom’s Vice President Alexander Medvedev said at a recent conference in New York.
Last month, Iran and Venezuela proposed to the Organization of Petroleum Exporting Countries (OPEC) to switch to a basket of currencies in its oil deals.
Iran, the world’s fourth most prolific oil exporter, has already abandoned the dollar, Iran’s Oil Minister Gholam-Hossein Nozari said on December 9, describing the currency as unreliable.

SHANGHAI, China, Dec. 15--China may be losing its competitive advantage, mainly because of rising costs, according to a survey of companies compiled by the American Chamber of Commerce in Shanghai.
Rampant product piracy was another persistent problem highlighted in a report released Friday that was based on a survey of the group’s 1,600 corporate members, AP wrote.
“Some companies mentioned plans to move offshore to India or Vietnam,“ said Norwell Coquillard, president of Cargill Investments China, an investment holding company of agribusiness giant Cargill Inc.
Still, he noted that most companies with operations in China were still planning to expand capacity on the Chinese mainland, often while moving factories and offices inland to smaller cities where costs are lower.
For many US and other foreign companies, finding, paying for and retaining good employees remains the biggest challenge, the report said.
“More investment has come in and stretched the supply of talent,“ said Stephanie Liu, human resources director in the Asia Pacific for Armstrong World Industries, a maker of flooring and building products. “There’s no sign of easing in the short term,“ she said.
Meanwhile, a new labor law, due to take effect next year, has increased uncertainties over hiring and firing practices.
The Labor Contract Law, which takes effect Jan. 1, gives employees who have worked at a company for more than 10 years the right to sign contracts protecting them from being fired without a legitimate reason.
Some companies worry that the law might restore the “iron rice bowl“ of lifetime employment practiced by China’s state sector during the era of central planning that followed the 1949 communist revolution, said Kent Kedl, general manager of the consulting firm Technomic Asia.
But Kedl said most US companies had little to fear because their employment policies were generally in line with international standards, unlike those of smaller local companies that often dismiss workers en masse to avoid paying bonuses, among other things. “We don’t foresee a huge impact here,“ he said.
The report also said that the recent spate of recalls of products ranging from tires to toothpaste due to safety and quality concerns is prompting US businesses to become much more vigilant over how their products are made.

Some 14,000 ships, comprising about five percent of annual world commerce, pass through the Central American shortcut between the Atlantic and Pacific Oceans.

PANAMA CITY, Dec. 15--Panama will take bids from four international consortiums seeking to build new, larger ship locks for the Panama Canal, government officials said Friday.
The locks are a key part of the 5.25 billion-dollar canal expansion project begun in September, aimed at doubling the capacity of the 50-mile (80-kilometer) canal connecting two oceans, AFP reported.
Panamanian officials hope the project will be finished by 2014. The four consortiums now have until August 2008 to present final proposals and price tags to compete for the contract, said Alberto Aleman, head of the Panama Canal Authority.
The bidders are as follows: The CANAL consortium, which includes the Spanish companies ACS Servicios, Acciona Infraestructuras and Sner Engineering of Spain, as well as the Germany-based Hochtief Construction, ICA of Mexico and Royal Haskoning of the Netherlands; Atlantic-Pacific of Panama, which includes Bouygues Construction, VINCI Construction and Alstom of France, Bilfinger Berger of Germany, the US-based AECOM, and four Brazilian companies; A consortium that includes the US-based Bechtel, and Taisei and Mitsubishi corporations of Japan;
The fourth group, “United Group for the Canal,“ includes Panama’s Constructora Urbana, US-based companies Tetra Tech, Montgomery Watson Harza and Heerema Group, and companies from the Netherlands, Italy, Spain and Belgium.
The canal was built 1904-1914 by the United States, which handed control over to Panama in December 1999.
The largest ships that now use the canal carry up to 5,000 containers, but after the expansion supertankers and ships carrying as many as 12,000 containers will be able to sail the canal.
Some 14,000 ships, comprising about five percent of annual world commerce, pass through the Central American shortcut between the Atlantic and Pacific Oceans, avoiding the arduous and costly journey around Cape Horn, at the southern tip of South America.
About 80 percent of Panama’s economy is linked to canal activity, amounting to some six billion dollars, or 80 percent of Panama’s gross domestic product.
The waterway’s main users are the United States, China and Japan.
The government says work would be financed by a hike in tolls, worth $1.2 billion in 2005.

NEW YORK, Dec. 15--Stocks swooned on Friday on concerns that surging inflation may prevent the Federal Reserve from lowering interest rates enough to pull the economy out of the grip of a housing and credit crisis.
The three major indexes tumbled more than 1 percent each, and posted their worst week since November 11, after a report showing a jump in the consumer price index in November. Combined with a sharp rise in producer prices, the reading highlighted concerns voiced by the Fed earlier in the week when it lowered rates modestly, Reuters reported.
With inflation making further rate cuts look less likely, retailers, banks and industrial stocks were sold off. Retailer Wal-Mart Stores Inc. fell 1.5 percent and credit card company American Express Co slid 2.9 percent.
“The main driver was nervousness. You’ve got some people using the stagflation word, and you hear that and it messes up the psyche of the average investor,“ said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.
The Dow Jones industrial average was down 178.11 points, or 1.32 percent, at 13,339.85. The Standard & Poor’s 500 Index was down 20.46 points, or 1.37 percent, at 1,467.95. The Nasdaq Composite Index was down 32.75 points, or 1.23 percent, at 2,635.74.
US inflation rose at its fastest pace in two years during November, spurred on by higher energy prices, according to figures from the Labor Department.
Consumer prices rose 0.8 percent in November from October, above market forecasts, BBC reported.
The figures come as US and UK central banks have been cutting interest rates to bolster weakening economic growth.
The higher than expected inflation figure saw the dollar post its biggest one-day rise against the euro in more than three years.
This is because traders now expect the Federal Reserve to delay any further rate cuts.
“The fear is that inflation will become the bigger concern,“ said John Forelli of Independence Investment in Boston.

ASHKHABAD, Turkmenistan, Dec. 15--Malaysia’s national oil company has been cleared to begin building oil platforms and share in pipeline construction in Turkmenistan, local television reported Friday.
“President Gurbanguly Berdymukhamedov has approved plans by Petronas to build oil platforms in cooperation with Turkmenistan so as to begin work on offshore finds as well as its wish to build pipelines in the country,“ a television report said.
A platform assembly operation will be set up on the shores of the Caspian Sea, an official in the local Petronas office was quoted by AFP as saying.
The official said Petronas hoped not only to build oil platforms for its own use but for other companies as well.
“This will allow the establishment of another oil platform manufacturing centre for the Caspian Sea,“ he added.
Petronas has been acting as a contractor for Turkmenistan’s state oil company Turkmenneft since 1996, and has since then carried out exploration and extraction in the Central Asian country.

ROME, Dec. 15--Alitalia SpA’s labor unions threatened Friday to stage strikes around the Christmas holidays unless they are called by the Italian government to discuss the company’s fate.
The Filt Cgil union said the action could be enforced even if it would fall during a holiday truce--a period during which strikes are banned by law because of the peak travel season, AP reported.
The unions said they wanted to know the details of non-binding offers for Alitalia presented last week by groups including Air France-KLM, the world’s largest airline by revenue, and Italy’s smaller carrier Air One.
Alitalia’s board has delayed until Tuesday a decision on which sole bidder to open negotiations with. The government, which has a 49.9 percent stake in the struggling airline, met earlier this week but failed to decide on a preferred bidder.
Italian media reports say the Cabinet is split over the issue. Premier Romano Prodi acknowledged divisions but downplayed their significance, saying the government is giving the bids a thorough examination and will come to a decision.
Prodi has also said that the restructuring plan, not nationality, would be a decisive factor in the government’s decision.