North America

U.S. drillers add oil rigs for 17th week in a row: Baker Hughes

13 May 2017   Shale Oil, USA

U.S. energy firms added oil rigs for a 17th week in a row, extending a 12-month drilling recovery that is expected to help boost crude production in the United States to a record high next year. Drillers added nine oil rigs in the week to May 12, bringing the total count up to 712, the most April 2015, energy services firm Baker Hughes Inc said on Friday. While that is more than double the same week a year ago when there were only 318 active oil rigs, the pace of those additions has declined with the total over the past four weeks falling to the lowest since March. U.S. crude output was expected to rise to an average of 9.3 million barrels per day (bpd) in 2017 […]

US oil rig count up 9 to 712 in week ended Friday: Baker Hughes

13 May 2017   Shale Oil, USA

The US oil rig count rose by 9 to 712 in the week ending Friday, up from 318 a year ago, Baker Hughes said in its weekly report.
The US natural gas rig count fell by one to 172, up from 87 rigs a year ago.  The total US oil and gas rig count was 885 for the week, eight higher than a week ago, and 479 rigs higher than a year ago.  There was one miscellaneous rig working this week, flat from last week and flat from a year ago.  Horizontal rigs operating in the US rose by eight week on week to 742, and was up from 315 a year ago. The vertical rig count rose by one on the week to 77, but was 24 higher than a year ago. Directional rigs totaled 66, down one from a week ago and 28 higher than a year ago.  There were 21 US offshore rigs operational this week, up two from last week and down one from a year ago.  Canada’s rig count fell by two to end the week at 80, but was up from 43 rigs operating the same week a year ago. Canada’s oil rig count rose by two on the week to 29, while the gas rig total fell by four to 51.

US coal train loadings continue to drop, reach 2017 low volumes: railroads

13 May 2017   Coal, USA

Sustained declines in coal train loadings from the Powder River Basin have pushed down total US volumes to a 2017-low weekly total, Surface Transportation Board filings showed. Data filed by the four major US railroads — BSNF, CSX, Norfolk Southern and Union Pacific — for the week ending May 5 showed nationwide coal loadings averaged 82.4 trains/d, down from 89.2 trains/d the previous week. US loadings were last lower the final week of 2016 at 81.1 trains/d. PRB coal loadings averaged 44.5 trains/d, down from 46.7 trains/d the previous week. PRB counts have slipped for three straight weeks and were last lower 49 weeks ago on May 27 last year at 41.4 trains/d. Central Appalachia loadings fell for the first time in five weeks as volumes dipped to 15.2 trains/d from a year-high 17.4 trains/d the prior week. Northern Appalachia coal loadings slipped to 9.5 trains/d from 9.7 trains/d, […]

Gas Looting In Mexico Turns Deadly

11 May 2017   Mexico

On May 3, a government investigation into illegal pipeline taps in the central state of Puebla turned violent. Gunmen using local civilians as human shields opened fire on army officials, leaving 10 dead . This Sunday, less than two weeks after the tragic event, a tapped pipeline in the nearby town of Nenetzintla erupted in flames. Image source: Univision noticias Don’t Buy Gold. Buy This Instead… This small company could be one of the biggest winners of the coming gold boom. Backed by a billionaire resource investor and management dream team they could be the next big thing in the space. Click here to find out more (Click to enlarge) Mexico loses an estimated 20,000 barrels of gasoline daily to theft — about three times the daily gas consumption of Washington, DC, according to Public Radio International. That’s a loss of as much as $4 million daily, ranking the […]

Trump Administration Revives Nevada Plan as Nuclear Waste Piles Up

11 May 2017   Nuclear, USA

Communities across the country are rallying behind the Trump administration’s push for a nuclear repository in Nevada, hoping their decades-old wait to ship radioactive material could be coming to an end. Yucca Mountain was designated 30 years ago as a final resting place for used fuel and other nuclear waste. Progress has stalled since then amid opposition by Nevada politicians who remain concerned about such a facility’s…

Bid to revoke Obama-era methane rules fails in U.S. Senate

11 May 2017   Climate, USA

In a blow to administration efforts to free the oil and gas industry from Obama-era environmental rules, a Senate resolution to revoke a rule to limit leaks and flaring of methane from oil and gas production on federal lands fell short of votes 49-51 on Wednesday. The surprise vote outcome came after Republican leaders scrambled for weeks to secure the 51 votes necessary to pass the Congressional Review Act resolution, which would revoke the rule and prevent any similar regulations from being introduced. Getting the Trump administration to repeal the Interior Department’s Bureau of Land Management methane rule had been a top priority of the oil and gas industry, but not all Republicans supported the measure because it would make it difficult to regulate methane waste in the future. Republican Senator John McCain […]

Effort to Overturn Methane Regulation Fails in Senate

11 May 2017   Climate, USA

Republican efforts to quickly repeal an environmental regulation from the Obama administration failed Wednesday, the first vote to not pass in the new Congress. Three Republican senators and all 48 members of the Senate’s Democratic caucus blocked a procedural vote on a bill to quash a regulation issued by President Barack Obama to cut the oil-and-gas industry’s emissions of methane on federal lands. The Obama…

Are US drivers losing their reputation as gas guzzlers?

11 May 2017   Transportation, USA

The oil market is getting nervous about the depth of US drivers’ love of the road. Data show that domestic petrol use has softened in 2017. Last week, a majority of hedge funds and money managers swung their gasoline bets towards lower prices, the first sign of negativity in months. A closer look reveals a more complicated picture, however. Drivers may have started the year in low gear but the data are deceiving, a government statistician says. On Tuesday, Washington upgraded its forecast to say US gasoline consumption will match the record levels of 2016. The direction of US petrol use has important consequences for crude after it fell below $50 a barrel. At more than 9m barrels a day, it makes up nearly a tenth of world oil consumption. US figures are updated more frequently than elsewhere, drawing extra attention from traders. Several organisations have reported lower gasoline demand. The American Petroleum Institute, the oil trade group, stated falls of 2.6 per cent in January, 3.8 per cent in February and 1.7 per cent in March from the same months of 2016.

Flows of gasoline and diesel into the Midwest fall as demand flattens and production grows

11 May 2017   Oil Supply, USA

Over the past 10 years, increased refining activity and relatively flat demand in the Midwest—Petroleum Administration for Defense District 2 (PADD 2)—have allowed refiners in the region to meet a larger share of regional gasoline and diesel fuel needs. As a result, shipments of gasoline and diesel into the region have declined, while shipments to other regions have increased. Despite these changes, the Midwest is still a net receiver of gasoline and diesel fuels, especially during summer months and during periods when refineries are undergoing maintenance. Midwest net receipts of gasoline and distillate (which is mainly ultra-low sulfur diesel) fell from 1.0 million barrels per day (b/d) in 2006 to 500,000 b/d in 2016. The decline in net receipts was driven primarily by a fall in gross receipts from the Gulf Coast (PADD 3), rather than an increase in shipments to […]

All Washed Up? Shale Oil and Gas Drowns Out US Gulf of Mexico Shallows

11 May 2017   Offshore, USA

More than 10,000 jobs in the US Gulf of Mexico may be lost, never to return, as shallow water drilling lands in the doldrums where experts say it will remain. Short-term contracts, dismantled infrastructure and lagging dayrates have long challenged shallow water drilling on the U.S. side of the Gulf of Mexico – but it’s the natural gas-belching shale plays that may finally turn the tide away from the shelf. In January 2007, there were 82 jackup rigs drilling in the shallow water of the U.S. Gulf (GOM). By January this year, that figure had dwindled down to 12. At the end of March, 11 jackups remained on the shelf, according to Rigzone Data Services. McDermott International Inc. began its exit from the U.S. shallows six years ago, said Scott Munro, McDermott’s vice president for the Americas, Europe and Africa. “There’s not much of the (U.S. GOM) shallow water […]

First Urals crude imported to US East Coast since 2013

11 May 2017   Russia, USA

Russian Urals crude was recently imported into the US East Coast for the first time since 2013, according to US Customs data. More shipments of the medium-to-light sour grade may be making the rare trip across the Atlantic as lower differentials, coupled with affordable freight rates, opened the opportunity, according to market sources. Two Urals cargoes aboard the same vessel were unloaded along the US East Coast within the past two weeks. The first, a 580,000-barrel shipment, arrived on the Elias Tsakos in Wilmington, Delaware, on April 30. Another 140,000 barrel shipment, also on the Elias Tsakos, arrived in Philadelphia on May 6. The cargoes were shipped by Statoil from storage in the Bahamas. Article continues below… Crude Oil Marketwire delivers vital intelligence to help you make critical decisions. Delivered daily direct to your desktop, Crude Oil Marketwire provides detailed market information, including crude oil price spreads, daily crude […]

Summary of Weekly Petroleum Data for the Week Ending May 5, 2017

11 May 2017   USA

U.S. crude oil refinery inputs averaged about 16.8 million barrels per day during the week ending May 5, 2017, 418,000 barrels per day less than the previous week’s average. Refineries operated at 91.5% of their operable capacity last week. Gasoline production increased last week, averaging about 10.1 million barrels per day. Distillate fuel production decreased last week, averaging about 5.0 million barrels per day. U.S. crude oil imports averaged over 7.6 million barrels per day last week, down by 644,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 8.2 million barrels per day, 5.0% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 953,000 barrels per day. Distillate fuel imports averaged 115,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic […]

Higher U.S. crude output should pressure oil prices: EIA

10 May 2017   Prices, Shale Oil, USA

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Higher crude output from the United States should pressure global oil prices through the end of 2018, the U.S. government said on Tuesday, ahead of a meeting later this month at which OPEC and non-member producers will discuss extending supply cuts. “Higher oil production from the United States, along with rising oil output from Canada and Brazil, is expected to curb upward pressure on global oil prices through the end of 2018,” said EIA Acting Administrator Howard Gruenspecht, in a statement. The United States, Canada and Brazil are not among producing countries including Russia who meet with OPEC this month to decide whether to continue output cuts of 1.8 million barrels per day in an effort to reduce a global crude glut and support prices. The U.S. Energy Information Administration said it expects domestic crude production […]

U.S. Oil Output to Hit a Record in 2018

10 May 2017   Oil Supply, USA

EIA lowers 2017 WTI price forecast to $50.68 from $52.24 Brent crude 2017 price projection revised down 3% to $52.60 U.S. crude production forecasts keep growing. The Energy Information Administration said domestic output will climb to a record 9.96 million barrels a day in 2018, up from 9.9 million barrels projected last month, according to the agency’s monthly Short-Term Energy Outlook released Tuesday. Production will average 9.31 million barrels a day in 2017, up from 9.22 million projected in April. U.S. explorers have added rigs this year, partially undermining oil-production cuts that started in January by the Organization of Petroleum Exporting Countries and 11 other exporters. The nation’s active oil-rig count has more than doubled in the past year to 703 last week, according to Baker Hughes Inc. The lag between drilling and reaching maximum production signals that output will climb further in coming months, according to the report. […]

U.S. motorists win in weak oil market

10 May 2017   Prices, USA

Low consumer demand and low crude oil prices means lower gasoline prices in the United States. File Photo by hxdbzxy/Shutterstock May 9 (UPI) — Low consumer demand and even lower crude oil prices means U.S. drivers are paying less at the fueling station than they were last month, market analyses found. Motor club AAA reported a national average retail price for a gallon of regular unleaded gasoline at $2.34, down about 1 cent from Monday, 4 cents from last week and 5 cents from one month ago. Last week, all but four states saw a decline in retail gasoline prices, bucking a seasonal trend. “The trending decline is due to an unseasonable glut of gasoline in the U.S. market, record high refinery production rates, moderate demand and a recent drop in crude oil prices,” AAA stated in its weekly market report . Retail gasoline prices usually start climbing toward […]

Hanford Nuclear Site Declares Emergency After Tunnel Collapse

10 May 2017   Nuclear, USA

The roof over part of an underground tunnel containing radioactive materials collapsed at a former nuclear-weapons production site in a remote part of Washington state, prompting an emergency declaration and evacuation of some employees, officials said. There was no indication of radioactive contamination in the area of the Hanford nuclear-weapons site, according to federal officials, but the incident is another setback to the…

U.S. Oil And Gas To Contribute $1.9 Trillion To U.S. GDP By 2035

8 May 2017   USA

Since U.S. oil production started recovering at the end of 2016, coinciding with a pro-oil administration entering the White House, industry bodies and analysts have been projecting that the U.S. shale patch output will continue to rise. Earlier this week, the American Petroleum Institute (API) released a study it had commissioned which claims that not only will production grow, but investment in oil and gas infrastructure will contribute between US$1.5 trillion and US$1.89 trillion to U.S. GDP by 2035, or between US$79 billion and US$100 billion annually. Energy infrastructure is a leading catalyst for economic growth, said the oil industry association in the study commissioned to ICF. The study also sees rapid oil infrastructure development likely to continue for a prolonged period, with total capital expenditures (capex) for oil and gas infrastructure development between 2017 and 2035 ranging from US$1.06 trillion in the base case to US$1.34 trillion in […]

Brimming U.S. oil storage tanks to feel OPEC cuts last

An oil derrick and wind turbines stand above the plains north of Amarillo, Texas, U.S., March 14, 2017. The energy industry scrutinizes U.S. oil stockpile data every week for evidence that OPEC supply cuts are ending a global crude glut, but growing domestic output means the world’s largest oil consumer may be the last place to feel the cuts. Stubbornly high U.S. inventory levels have shaken market confidence that a deal by the Organization of the Petroleum Exporting Countries (OPEC), Russia and other top producers to cut 1.8 million barrels per day (bpd) from supply will end the two-year glut. This week, benchmark Brent crude prices slipped below $50 a barrel. Brent has given up all the gains made since the supply cuts were agreed late last year. [O/R] U.S. inventories are a trusted barometer for the health of global oil markets because of the transparency of the data […]

Oil-rich Alberta lands energy agreement with Japan

6 May 2017   Canada

A deal with a Japanese oil and gas company was among agreements reached during a recent trade visit to Asia, the provincial leader of Alberta said. Alberta Premier Rachel Notley concluded a recent tour of Asia alongside Economic Development and Trade Minister Deron Bilous. Three of 10 days were spent in Japan, where she met with representatives from sectors ranging from energy to agriculture. During her visit, Notley signed an agreement with the Japan Oil, Gas and Metals National Corp. to collaborate on components related to oil and gas exploration and production. “A stable and resilient economy needs a diversity of products and a diversity of markets. Asia is hungry for the world-class products and services Alberta businesses offer,” […]

US jobless rate falls to lowest level in 10 years

6 May 2017   USA

The pace of US jobs growth bounced back last month while the unemployment rate dipped to its lowest level since 2007, supporting the Federal Reserve’s view that the economy’s choppy first-quarter was probably a blip and bolstering Wall Street’s expectations for a June rate rise. The US economy added 211,000 jobs in April, from a downwardly revised gain of 79,000 jobs in the previous month, the labour department said. Meanwhile, the unemployment rate fell to 4.4 per cent from 4.5 per cent, significantly lower than the 4.6 per cent that Wall Street was expecting. However, that came as the labour force participation rate, a measure of the working-age population that is either employed or seeking work, dipped to 62.9 per cent from 63 per cent.

Mexico’s Pemex Raises Oil Output, Fuel Production In Q1

5 May 2017   Mexico

Mexico’s state energy major Pemex has increased its oil output and the amount of crude it feeds into its refineries, with exports to the U.S. and Asia declining over the first quarter of the year by 3.6 percent. The company reported a net profit of US$4.67 billion (88 billion pesos) for the period, up from a loss of US$3.29 billion (62 billion pesos) a year earlier, boasting revenues of US$18.53 billion (349 billion pesos). This was the second quarter with a positive net performance for the company, after eight quarters in the red. Crude oil output, Pemex reported, averaged 2.018 million bpd in the period, in line with company targets. Offshore production in the Gulf of Mexico accounted for the bulk of the output, at 81 percent, versus 19 percent for onshore production. Refinery runs jumped by 21 percent in the three-month period, Pemex also said in the presentation […]

Pemex seeks investors for its refineries, but who’s buying?

5 May 2017   Mexico

Sweeping energy reforms have turned Mexico into one of the world’s most attractive offshore prospects, but one segment is getting no love from U.S. investors: the nation’s aging refineries. Efforts by Mexico’s state-owned oil company Pemex to attract about $5 billion in capital to help modernize its two largest refineries so far have proved futile, according to two people familiar with the process who declined to be named because they were not authorized to speak publicly. The company is seeking a joint venture partner for its Salina Cruz refinery on the West Coast. It’s also looking for an investor to complete construction of a coking unit to process heavy crude at its Tula refinery just north of Mexico’s capital. Among those to rebuff overtures from Pemex over the […]

Mexican Soldiers, Alleged Fuel Thieves Killed in Shootouts

5 May 2017   Mexico

Clashes between soldiers and alleged fuel thieves left 10 people dead and nearly a dozen more injured in central Mexico, the military and state officials said Thursday. Four soldiers and six civilians died in the two clashes Wednesday night in Palmarito, a town in Puebla state that straddles the expressway linking Mexico City and the port of Veracruz, about 110 miles southeast of the Mexican capital. Ten soldiers and a…

Little fanfare, but Gulf of Mexico oil still growing steadily

5 May 2017   Offshore, USA

As rapid growth in U.S. shale production grabs headlines and threatens to upend attempts by OPEC to balance oil markets, a more unsung sector of the U.S. industry is also hitting new output highs – the offshore Gulf of Mexico. While attention and investment is focused on shale, the Gulf is the among the most prolific oil source in the United States, producing more than Alaska, the West Coast and Rocky Mountains combined. The region churned out a record 1.76 million barrels per day of crude in January, trailing only Texas onshore production, which includes the growing Permian Basin. “The business can compete with tight onshore oil any day,” said Richard Morrison, regional president for the Gulf of Mexico for BP Plc ( BP.L ) speaking at the annual Offshore Technology Conference in Houston, […]

Deepening Gasoline Glut Pushes Oil to a Five-Month Low

5 May 2017   USA

U.S. refiners are flooding the market with gasoline, intensifying oil prices’ spring decline. Refiners are turning crude oil into gasoline and diesel at the highest rate in at least 34 years, according to data from the U.S. Energy Information Administration. One reason: The spread between what it costs refiners to buy crude and the price…

Is The U.S. Oil Patch A Value Trap?

5 May 2017   Oil Supply, USA

While the S&P 500 is up 6.49 percent , year to date (YTD), it has not brought any cheers to energy investors. Energy investors continue to see their investment bleed, as the energy sector is down 10.02 percent YTD. For the others waiting on the sidelines, the big question is whether to enter at the current levels or stay away from the energy stocks altogether. Let’s solve this puzzle! We analyze the investment rationale for the short-term investors who have an investment horizon of less than a year and for the medium-term investors, who have an investment horizon of about 1-2 years. The long-term picture is too uncertain; hence, we won’t delve into it. The short-term picture In the short-term, the equity market is dictated more by sentiment, rather than the prevailing fundamentals. After the Organization of the Petroleum Exporting Countries (OPEC) – excluding Nigeria and Libya – and […]

Summary of Weekly Petroleum Data for the Week Ending April 28, 2017

4 May 2017   Oil Supply, USA

U.S. crude oil refinery inputs averaged about 17.2 million barrels per day during the week ending April 28, 2017, 108,000 barrels per day less than the previous week’s average. Refineries operated at 93.3% of their operable capacity last week. Gasoline production increased last week, averaging 9.8 million barrels per day. Distillate fuel production increased last week, averaging 5.1 million barrels per day. U.S. crude oil imports averaged about 8.3 million barrels per day last week, down by 648,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged over 8.2 million barrels per day, 4.9% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 693,000 barrels per day. Distillate fuel imports averaged 112,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) […]

Ohio lawmakers add budget provision that could open state parks to fracking

4 May 2017   Shale Oil, USA

Ohio legislators took a step toward allowing fracking in state parks, adding a provision in a pending budget that would strip the governor of the ability to control the issuing of licenses for the oil and gas drilling practice that has raised environmental concerns. The provision, added on Tuesday by the Republican-controlled House, would allow the state legislature instead of the governor to control appointments to the Oil and Gas Commission responsible for issuing drilling licenses for state lands. Governor John Kasich, a Republican, has not named any members to the four-member commission since signing the bill that created the group in 2011. This has effectively halted any fracking in parks. Fracking opponents complained that the legislature was now trying to find a way to allow […]

Pentagon concerned about lifting offshore drilling moratorium

4 May 2017   Offshore, USA

A letter viewed by Florida lawmakers from the Pentagon said maintaining a moratorium on drilling in parts of the Gulf of Mexico was in the nation’s interest. A letter from the Department of Defense to U.S. Rep. Matt Gaetz, D-Fla., expressed concern about recent executive action from President Donald Trump that could open up more offshore areas for drilling. Anthony Kurta, acting undersecretary of defense for personnel and readiness, said in the letter that keeping parts of the Gulf of Mexico off limits beyond 2022 was essential for developing future combat readiness. “The Department of Defense cannot overstate the vital importance of maintaining this moratorium,” the letter read. The April letter to Gaetz was obtained by the […]

What Mexico’s Falling Exports Mean For Oil Prices

3 May 2017   Mexico

Oil prices are unable to get up off the canvas, as signs of global market rebalancing continue to be errant. With the first weekly EIA report of the month on deck tomorrow, hark, here are five things to consider in oil markets today: 1) Saudi Aramco officially took full control of the Port Arthur refinery yesterday, after breaking up its joint venture with Shell and separating the assets. Saudi Aramco assumes full ownership of the JV name, Motiva Enterprises. Port Arthur is the largest refinery in North America with a capacity of 600,000 bpd, and the deal means Saudi Aramco maintains a solid foothold for its crude in the U.S. market. As for flows to the refinery, we can see from our ClipperData they should not change much, given Saudi grades already account for over 70 percent of imports: (Click to enlarge) 2) In terms of the OPEC / […]

Conservationists sue to halt fracking in Ohio’s only national forest

3 May 2017   Shale Oil, USA

Four conservation groups on Tuesday sued the U.S. Forest Service and Bureau of Land Management in an attempt to halt fracking plans in a portion of Ohio’s only national forest. The suit, filed in U.S. District Court in Columbus, argues that the federal agencies failed to sufficiently analyze risks to watersheds, public health, climate and endangered species, including Indiana bats, before auctioning 670 acres (270 hectares) in December of the Wayne National Forest in Southeast Ohio for eventual hydraulic fracturing, or fracking, of underground shale. The groups are seeking an injunction to halt oil and gas leasing and development until a new assessment can be made. Fracking involves injecting water, sand and chemicals into wells to fracture shale and release natural gas and oil. U.S. Forest Service and Bureau of Land Management officials could not be reached immediately for comment. The Ohio Oil and Gas Association declined to immediately […]

Demand for bigger vehicles spell bigger profits for carmakers

3 May 2017   Transportation, USA

Revenues and profits at carmakers have been boosted by a shift towards larger vehicles as low fuel prices and a flurry of new products convince motorists to ditch traditional saloon cars for sport utility vehicles. A barrage of results from some of the world’s biggest auto groups has confirmed that the trend towards SUVs is showing no signs of stopping. All-but one of the European or US carmakers that reported first-quarter trading figures last week noted a rise in “mix”, an industry term used to describe the type of vehicles being sold. Higher mix equates to larger vehicles, particularly SUVs. The demand for SUVs raises questions over the future of saloon vehicles, which are known as sedans in the US and much of the rest of the world. “There is a longstanding trend showing how the sedan body-type is slowly disappearing from the European roads,” said Felipe Munoz, global automotive analyst at JATO Dynamics. Ford booked an additional $428m of profit from rising “mix” in North America and Europe in its first-quarter results last week. Just over one in five vehicles sold by Ford in Europe, a market historically dominated by smaller cars and saloons, were SUVs, the company said.

Trump says open to raising gasoline tax to fund infrastructure: Bloomberg

2 May 2017   USA

President Donald Trump said on Monday he would consider raising the federal tax on gasoline to fund infrastructure development “earmarked toward the highways,” Bloomberg News reported. “It’s something that I would certainly consider,” Trump told the news agency in an interview on Monday. (Reporting by Timothy Ahmann; Editing by Chizu Nomiyama)

BP finds hidden trove of oil in Gulf of Mexico

29 Apr 2017   Offshore, USA

British oil major BP has discovered 200 million barrels of oil in a hidden cache in the Gulf of Mexico, thanks to a technological breakthrough allowing the company to see beneath geological formations that had befuddled oil exploration for decades. The find, worth a potential $2 billion in recoverable oil, is in an undrilled section of BP’s Atlantis field in 7,000 feet of water 150 miles from New Orleans. Long obscured by a salt dome, which distorts seismic waves that oil companies use to map features below the earth, the oil reserves were revealed by using a supercomputer and mathematical algorithm to interpret the seismic data in a new way. The Gulf find is another example of oil companies advancing technology to make unexpected discoveries. The advent of seismic imaging allowed oil and gas companies to model mineral layers below the earth’s surface and drill more precisely. The combination […]

U.S. Oil Rig Count Increases For 15th Straight Week

29 Apr 2017   USA

The number of active oil and gas rigs in the United States rose by 13 on Friday, according to oilfield services provider Baker Hughes. The total oil and gas rig count in the US now stands at 870 rigs, or 450 above the count a year ago. Oil rigs increased by 9, while gas rigs bumped up 4. This week marks the fifteenth straight build for oil rigs (+175 or +33.5% since January 13). While gas rigs haven’t enjoyed the same persistently ascending trajectory week to week, they have climbed 10 of the last fifteen weeks, for a total gain of 35 (+25.7%). Rig Factoid: The largest three-week gain in the number of active oil rigs in the US over the last decade was April 1, 2011. The rig count spiked 26 that week, for a total of 76 rigs gained over a three consecutive-week period. WTI spot price […]

U.S. GDP Growth Slowed on Tepid Consumer Spending

29 Apr 2017   USA

The U.S. economy stumbled in the first months of the Trump administration, growing at the slowest pace in three years in a sobering reminder of the nation’s economic sluggishness. Gross domestic product grew at a 0.7% annual rate in the first quarter from the preceding three months, the Commerce Department said Friday. Economic output has grown an average of roughly 2% during the nearly eight-year expansion. …

U.S. gasoline demand falls for second straight month: EIA

29 Apr 2017   USA

U.S. gasoline demand fell 2.4 percent in February from a year earlier, the second straight monthly decline, according to data released on Friday by the U.S. Energy Information Administration that suggested the market may have trouble repeating last year’s record volumes. Gasoline demand fell 218,000 barrels per day to 8.988 million bpd in February, according to the EIA’s petroleum supply monthly report. January demand for gasoline fell 1.9 percent from last year, EIA data showed. U.S. refiners have said weather issues cut demand early this year. They still expect gasoline demand will rise modestly from last year’s record levels, executives said in an earnings calls this week. U.S. total oil demand in February fell 2.5 percent, or 492,000 bpd from a year ago, to 19.18 million bpd, EIA data showed. The growth in […]

Mexico’s Pemex approves new deep water Gulf joint venture

28 Apr 2017   Mexico

The logo of Mexico’s state-owned company Pemex is pictured at a refinery in Cadereyta, on the outskirts of Monterrey, Mexico, April 20, 2017. The board of Mexico’s state-owned oil company Pemex on Thursday approved its second-ever deep water joint venture covering the Nobilis-Maximino block in the country’s territorial Gulf waters. Reuters revealed details of the plan last week. (Reporting by David Alire Garcia)

On Trump Tax Play, Watch What You Wish for, Drillers Warned

28 Apr 2017   USA

Energy producers among most taxed sectors in U.S.: BI report But cut in corporate rate may also jeopardize tax deductions While President Donald Trump’s plan to cut corporate income taxes could save oil and natural gas explorers $13 billion a year, it jeopardizes tax breaks that may mean even more to U.S. shale drillers. The proposal outlined Wednesday is a long way from the finish line and could change significantly in the coming months. One major question is whether Trump and the U.S. Congress balance lower tax rates by reducing other incentives, like a deduction for drilling expenses that may save companies $35 billion over the next decade, according to a report Thursday by analysts at Bloomberg Intelligence. That could be a bad exchange for independent exploration and production companies — the small and midsize drillers who focus on U.S. shale fields. With oil prices slumping in recent years, […]

Trump order may seek to reverse offshore drilling ban

28 Apr 2017   Oil Supply, USA

 U.S. presidential remarks about Alaska and senate measures on offshore drilling may point to an executive action on oil and gas, authorities on the matter said. “We’re going to take care of Alaska too,” President Donald Trump told Sen. Lisa Murkowski , R-Alaska, during remarks on the signing of an executive order on national lands. “Don’t worry about it.” A pro-oil former businessman, the president has used the power of office to push for action meant to bolster the domestic economy, including a recent order to investigate trade practices that could be harming the U.S. steel industry. In an executive order signed Wednesday, the Trump administration ordered the Interior Department to […]

Texas oil production in February increased slightly from last year

28 Apr 2017   Shale Oil, USA

Preliminary data from Texas show total crude oil production for February was slightly more than figures from the same time last year, a regulator reported. The Railroad Commission of Texas, the state energy regulator, reported a preliminary crude oil production volume of 70.3 million barrels for February, against the preliminary output of 70.2 million barrels in February 2016. Oil production figures from the commission don’t include condensate, an ultra-light form of oil found in some shale deposits, and last February’s preliminary data was updated to 82.7 million barrels. Texas is the No. 1 oil producer in the United States and home to shale basins seen as more resilient to the relative low price for crude oil than elsewhere […]

Exxon Hikes Dividend Yet Again, Despite Low Oil Prices

28 Apr 2017   USA

ExxonMobil has continued its streak of hiking its dividend, announcing another increase in its payout to shareholders on Wednesday. The oil major has boosted its dividend every year for more than three decades, but the collapse of oil prices since 2014 has resulted in more scrutiny over the company’s payments to shareholders. Exxon has defied the oil market downturn, stepping up shareholder payments even though the company has seen its debt pile balloon over the past three years. Exxon is viewed as one of the most rock-solid stocks for investors, and the confidence that shareholders have in the ever-increasing dividend is one of the reasons why. The dividend is treated as sacred – Exxon, and other oil majors, refused to touch their dividend policies over the past few years even as they made savage cuts elsewhere, slashing new exploration, deferring projects, gutting their payrolls, and selling off assets. They […]

Trump advisers to discuss whether U.S. stays in Paris climate pact: official

27 Apr 2017   Climate, USA

White House advisers and Trump administration officials will meet on Thursday to discuss whether the United States should remain in the Paris climate agreement, a White House official said on Wednesday. The meeting, which will include member of the National Economic Council and cabinet officials such as Environmental Protection Agency Administrator Scott Pruitt and Energy Secretary Rick Perry, was scheduled for 1:30 P.M. EDT (1730 GMT) after being postponed earlier this month. The administration is expected to make a decision on whether to remain a party to the deal by the time leaders of the Group of Seven wealthy nations meet in late May. The accord, agreed by nearly 200 countries in Paris in 2015, […]

Summary of Weekly Petroleum Data for the Week Ending April 21, 2017

27 Apr 2017   Oil Supply, USA

U.S. crude oil refinery inputs averaged 17.3 million barrels per day during the week ending April 21, 2017, 347,000 barrels per day more than the previous week’s average. Refineries operated at 94.1% of their operable capacity last week. Gasoline production decreased last week, averaging over 9.7 million barrels per day. Distillate fuel production decreased last week, averaging about 5.1 million barrels per day. U.S. crude oil imports averaged over 8.9 million barrels per day last week, up by 1.1 million barrels per day from the previous week. Over the last four weeks, crude oil imports averaged over 8.1 million barrels per day, 4.9% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 916,000 barrels per day. Distillate fuel imports averaged 54,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic […]

Oil Prices Pull Higher As Refiners Soak Up Soaring Crude Imports

27 Apr 2017   Oil Supply, USA

In today’s game of rock-paper-scissors from the weekly EIA inventory report, crude inputs were propelled higher (like a rock), blunting the impact of super-strong imports (the scissors). On paper, the crude draw is bullish, but a modest rally is being kept in check somewhat by solid builds to the products. Hark, here are five things to consider in oil markets today: 1) Even though crude imports jumped higher by over 1.1 million barrels per day last week, a climb into unchartered territory by refinery runs meant that crude inventories were drawn down by 3.6 million bbls. Refinery runs jumped to 17.3 million bpd, the highest level on record, as cheap and available crude – as opposed to strong demand – is driving on refining activity. Refinery runs are now a surreal 1.44 million bpd – or 9 percent – higher than year-ago levels: (Click to enlarge) 2) Crude imports […]

EIA Takes Markets By Surprise, Reports Major Crude Oil Inventory Draw

27 Apr 2017   Oil Supply, USA

Amid growing pessimism regarding an extension of OPEC’s oil production deal, and a day after the American Petroleum Institute reported an estimated increase of 897,000 barrels in U.S. commercial inventories, the EIA reversed the mood with a draw of 3.6 million barrels for the week to April 21. Analysts had expected a respite for oil prices with a decline in inventories of 1.6 million barrels and though they were out of luck with API, EIA exceeded the expectations. The EIA reported that crude inventories stood at 528.7 million barrels at the end of last week, still near the upper seasonal limit despite refineries increasing their runs after the end of maintenance season, which some analysts argued was the reason for the hefty weekly inventory increases that we saw over the last couple of months. They may well have been right, as refinery runs averaged 17.3 million barrels in the […]

Trump Order Aims To Allow Drilling At National Monuments

27 Apr 2017   Oil Supply, USA

U.S. President Donald Trump signed an executive order on Wednesday to identify national monuments that can be rescinded or resized – part of a broader push to open up more federal lands to drilling, mining and other development. The move comes as part of Trump’s effort to reverse a slew of environmental protections ushered in by former President Barack Obama that he said were hobbling economic growth – an agenda that is cheering industry but enraging conservationists. Trump signed the order at the Interior Department in Washington, saying that his predecessors’ use of the 1906 Antiquities Act to create monuments marked an “egregious abuse of federal power.” He said the order […]

Fast-rising U.S. shale oil output puts OPEC cut at risk: Rystad

27 Apr 2017   Shale Oil, USA

Shale oil output in the United States is rising much faster than expected and gaining market share globally, increasing the risk of a “volume war” with OPEC and weaker oil prices, the founder of oil and gas consultancy Rystad Energy said. Rystad Energy expects U.S. shale oil output to grow by 100,000 barrels per day (bpd) each month for the rest of this year and into 2018 if oil prices hold around $50-$55 a barrel, well above estimates by the U.S. Energy Information Administration for monthly gains of about 29,000 bpd in 2017 and 57,000 bpd in 2018. “We see a risk for a weaker oil price towards the end of the year … because shale is delivering so much oil and OPEC might fight back,” Jarand […]

Crude stocks decline, product inventories rise sharply: EIA

27 Apr 2017   Oil Supply, USA

U.S. crude stocks fell last week as refineries hiked output, while gasoline stocks increased and distillate inventories rose, the Energy Information Administration said on Wednesday. Crude inventories USOILC=ECI fell by 3.6 million barrels in the week to April 21, compared with analysts’ expectations for an decrease of 1.7 million barrels. Crude stocks at the Cushing, Oklahoma, delivery hub USOICC=ECI fell by 1.2 million barrels, EIA said. Refinery crude runs USOICR=ECI rose by 347,000 barrels per day, EIA data showed. Refinery utilization rates USOIRU=ECI rose by 1.2 percentage points. Gasoline stocks USOILG=ECI rose by 3.4 million barrels, compared with analysts’ expectations in a Reuters poll for a 1 million-barrel drop. […]

Will Trump Spark An Offshore Drilling Boom?

27 Apr 2017   Offshore, USA

In a bid to fend off criticism over a dearth of achievements in his first 100 days in office, President Trump plans to sign a flurry of executive orders this week. Among them is an executive order intended to open up new areas of offshore oil and gas drilling. “This builds on previous executive actions that have cleared the way for job-creating pipelines, innovations in energy production, and reduced unnecessary burden on energy producers,” a White House official told the Reuters earlier this week. The order calls for a “review of the locations available for offshore oil and gas exploration and of certain regulations governing offshore oil and gas exploration.” Specifically, the Trump administration is hoping to open up new areas to drill in the Gulf of Mexico, plus areas in the Atlantic and Arctic Oceans. The Obama administration had previously designated the Atlantic and the Arctic off limits […]