Day Of Reckoning in 2018? US Rig Count Poised For Loss

22 Jun 2017   Oil Supply, USA

E&Ps’ continued austerity, coupled with swelling oilfield service costs, will choke off the US rig count surge and bring down as many as 100 rigs by the end of 2017, analysts at Barclays say. Unless they’re missing something – and really, that’s pretty unlikely – analysts at Barclays believe U.S. oil and gas will lose as many as 100 onshore rigs by the end of the year. As of June 16, there were 933 rigs at work in the United States – that’s up 270 rigs since January. But as rigs efficiency reverses and oilfield service costs trend upward, fewer rigs will remain active during the remainder of the year, Barclays said in a June 20 note to investors. In fact, for the rig count to linger above 900, exploration and production (E&P) companies would have to increase spending by 70 percent this year and well costs would have […]

For thousands of U.S. auto workers, downturn is already here

22 Jun 2017   USA

Wall Street is fretting that the U.S. auto industry is heading for a downturn, but for thousands of workers at General Motors Co factories in the United States, the hard times are already here. Matt Streb, 36, was one of 1,200 workers laid off on Jan. 20 – inauguration day for Republican U.S. President Donald Trump – when GM canceled the third shift at its Lordstown small-car factory here. Sales of the Chevrolet Cruze sedan, the only vehicle the plant makes, have nosedived as U.S. consumers switch to SUVs and pickup trucks. Streb is looking for another job, but employers are wary because they assume he will quit whenever GM calls him back. “I get it,” said Streb, who has a degree in […]

Summary of Weekly Petroleum Data for the Week Ending June 16, 2017

22 Jun 2017   USA

U.S. crude oil refinery inputs averaged about 17.2 million barrels per day during the week ending June 16, 2017, 104,000 barrels per day less than the previous week’s average. Refineries operated at 94.0% of their operable capacity last week. Gasoline production increased last week, averaging about 10.2 million barrels per day. Distillate fuel production increased last week, averaging about 5.3 million barrels per day. U.S. crude oil imports averaged 7.9 million barrels per day last week, down by 149,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 8.1 million barrels per day, 2.0% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 909,000 barrels per day. Distillate fuel imports averaged 87,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum […]

U.S. refineries are running at record-high levels

21 Jun 2017   Refining, USA

Refinery gross inputs include crude oil and other oils processed through crude distillation units. Gross inputs to U.S. petroleum refineries, also referred to as refinery runs, averaged a record high 17.7 million barrels per day (b/d) for the week ending May 26, before dropping slightly to 17.5 million b/d for the week ending June 2 and 17.6 million b/d for the week ending June 9. Product supplied to the U.S. market as well as inventories and exports are also at relatively high levels. Weekly U.S. refinery runs have exceeded 17 million b/d only 24 times since EIA began publishing the data series in 1990, and all of those instances have occurred since July 2015. Despite record-high inputs, refinery utilization did not reach a new record, because refinery capacity has increased in recent years. Refinery utilization reached 95% for the […]

Gulf of Mexico Storm Cindy Disrupts Shipping, Crude Imports

21 Jun 2017   Oil Supply, USA

Cindy could delay oil imports, exports through the week Storm to approach Louisiana, Texas coastline late Wednesday Tropical Storm Cindy has halted service at a major oil terminal in the Gulf of Mexico, prompted some evacuations at rigs and platforms and put states from Texas to Florida on notice for flooding rains. Cindy was 350 miles (560 kilometers) southeast of Galveston, Texas, with top winds of 45 miles an hour late Tuesday. It’s forecast to come ashore early Thursday somewhere near the Texas-Louisiana state line, according to a U.S. National Hurricane Center advisory issued at 8 p.m. New York time. The storm has triggered watches and warnings along the Texas-Louisiana coast including Galveston Bay, the entrance to the Houston Ship Channel and Sabine Pass, the site of the only active liquefied natural gas export terminal in the lower 48 states. Storms in the Gulf can often roil energy markets […]

As Natural Gas Gains, a Taxed Grid Raises Alarm

20 Jun 2017   USA

Natural gas has become the trendy power-plant fuel in New England so quickly that it concerns the grid operator charged with keeping the region’s lights on.  On the coldest days, natural gas is in high demand for both heating homes and running power plants, taxing pipelines that supply the region. This was a major problem during a frigid winter several years ago, and gas continues its rise.   In 2000, natural gas-fired plants represented just 18% of New England’s system capacity, grid operator ISO New England said. Aided by low prices, gas grew to 44% by last year.“The markets have brought forward many new electric-generating units,” said Anne George, spokeswoman for the grid operator. “And for the most part they have been natural gas-fired generation.”

Owners of other kinds of plants keep shutting them down due to economic pressure: Massachusetts’ last coal-fired power plant just switched off, and one of three coal plants left in New England, in Connecticut, is slated to change to natural gas. The Pilgrim nuclear plant in Massachusetts is also scheduled to close.  But gas pipelines have proved challenging to build in the region, and capacity hasn’t expanded much. The grid operator has a new plan, starting next year, to offer financial rewards to generators that perform well when the system is taxed, though it acknowledged this may not be enough on the coldest days.

Big Oil Steps Up Support for Carbon Tax

20 Jun 2017   Climate, USA

Some of the world’s largest oil companies and the country’s biggest auto maker are joining a group pushing the U.S. government to tax carbon in an effort to slow climate change. General Motors Co., Exxon Mobil Corp. and BP PLC are among almost a dozen companies joining the Climate Leadership Council, a new organization that advocates replacing many environmental regulations with a simplified tax on businesses that release carbon…

What’s Wrong With The U.S. Oil Export Boom

20 Jun 2017   exports, USA

The lead editorial in Friday’s Wall Street Journal was pure energy nonsense.’ “ Lessons of the Energy Export Boom ” proclaimed that the United States is becoming the oil and gas superpower of the world. This despite the uncomfortable fact that it is also the world’s biggest importer of crude oil. The Journal uses statistical sleight-of-hand to argue that the U.S. only imports 25% of its oil but the average is 47% for 2017. Saudi Arabia and Russia–the real oil superpowers–import no oil. The piece includes the standard claptrap about how the fracking revolution has pushed break-even prices to absurdly low levels. But another article in the same newspaper on the same day described how producers are losing $0.33 on every dollar in the red hot Permian basin shale plays. Oops. The main point of the editorial, however, is to celebrate a surge in U.S. oil exports to almost […]

Inside The World’s Most Sophisticated Refining Industry

20 Jun 2017   Refining, USA

Over the past 5 years, focus on the U.S. oil & gas sector has centered around oil production from the U.S. shale revolution while neglecting, arguably, the most important part of the US oil & gas sector: U.S. refining. The shale revolution may have put the U.S. in the top 3 oil producers in the world, but the U.S. already has the top spot with the world’s largest and most sophisticated refining industry. (Click to enlarge) In terms of size, China’s refining industry comes closest to the U.S. with over 15 million barrels per day (bbl/d) of refining capacity, but the industry operates at less than 75 percent utilization. The low utilization of Chinese refineries is because 3.5-4.5 million bbl/d of refining is done by independent “teapot” refineries that operate at 30 percent-60 percent capacity. These teapot refineries are inefficient and propped up by government regulations. In terms of […]

US oil groups feel Russia sanctions freeze more than Europeans

20 Jun 2017   Russia, USA

Russian President Vladimir Putin this month made an emotional tribute to Christophe de Margerie, the former boss of France’s Total who was killed in an accident in 2014.  At the launch of a new gas tanker named after Mr de Margerie, Mr Putin declared him a “great friend of our country”, a sentiment that extends to many executives at Total’s European oil and gas peers.  While US energy groups stepped back from Russia in response to a sanctions regime that Washington lawmakers moved to tighten this month, rivals in the EU have held fast, ducking through loopholes in Brussels’ restrictions to keep joint ventures running.

Elizabeth Rosenberg, a sanctions expert formerly at the US Treasury and now with the Center for a New American Security, points to the “regulatory arbitrage” between the EU and US sanctions. “US firms see an uneven playing field,” says Ms Rosenberg. Since the collapse of the Soviet Union, Russia has been a glittering prize for foreign oil companies. With proved reserves of 110bn barrels of oil and 32tn cubic metres of gas, according to BP, it is one of the world’s largest holders of economically producible hydrocarbons.Sanctions slapped on Moscow in 2014 by the US, EU and other countries in response to Russia’s invasion of Crimea were aimed at cutting off the development of its new oil frontiers from western help.

Daniel Yergin on U.S. Oil’s Global Impact

19 Jun 2017   Shale Oil, USA

Daniel Yergin says the boom in shale in concentrated areas like the Permian Basin, Texas and New Mexico is changing the global energy position of the U.S. “You go to Asia. You go to Europe. You go to the Middle East. They realize the position of the U.S. in the world is different today because of this change in our energy position. Among other things, the sanctions on Iran would not have worked had it not been for shale, because you could not have replaced the Iranian oil that was taken off the market. And so now instead of just OPEC and non-OPEC, you have the big three. You have Saudi Arabia, you have Russia, and you have a country called the United States.” — Daniel Yergin, vice chairman, IHS Markit

U.S. Oil-Rig Count Rises by 6

17 Jun 2017   USA

The number of rigs drilling for oil in the U.S. rose by 6 to 747 in the past week, according to oil-field services company Baker Hughes Inc. The U.S. oil-rig count typically is viewed as a proxy for activity in the sector. After peaking at 1,609 in…

No Respite For Oil Prices As U.S. Rig Count Gains, Canada Adds 27 Rigs

17 Jun 2017   USA

The number of active oil and gas rigs in the United States rose again this week by 6—making 22 weeks of gains, continuing the longest growth streak in oil and gas rig increases since at least 1987, which is the earliest date that Baker Hughes Excel data is available. Last week, both the US and Canada saw significant increases in the number of active oil and gas rigs—11 in the US and 33 in Canada. This week, Canada saw another large growth spurt, adding 27 rigs. The number of oil rigs in operation increased by 6, while gas rigs increased by 1. Miscellaneous rigs decreased by 1 to 0. Combined, the total oil and gas rig count in the US now stands at 933 rigs, which is 509 rigs over a year ago today, when oil prices were significantly higher than they were today. (Click to enlarge) Prices were […]

Analysis: Rising US crude oil exports complicate rebalancing efforts

17 Jun 2017   exports, USA

One reason for the bearish narrative gripping the oil market of late has been that draws in US crude stocks have essentially come at the expense of the rest of the world. US crude exports have surged this year — averaging more than 1 million b/d in April, the second most on record — driven by the significant discount of US crude prices relative to global benchmarks. The weakness of ICE Brent’s term structure compared with NYMEX crude can be seen as a symptom of the glut that has been exported out of the US to the rest of the world that, in turn, has weighed on the oil complex. The recent plunge in oil prices that began May 25 saw crude futures drop roughly $7/b through last week, while the contango widened across time maturities for ICE Brent and NYMEX crude. Moreover, the contango for ICE Brent has […]

Big Oil Firms Are Exploring a New Frontier in Shale: Profits

16 Jun 2017   Shale Oil, USA

For Bruce Niemeyer, the Chevron Corp. executive overseeing the company’s $15 billion expansion here, one question looms above all: Will we make money? Big oil companies including Chevron, Exxon Mobil Corp. and Royal Dutch Shell PLC are piling into the Permian Basin, the oil-rich region straddling Texas and New Mexico that is the epicenter of the second wave of U.S. shale drilling. Chevron and others say they…

Summary of Weekly Petroleum Data for the Week Ending June 9, 2017

15 Jun 2017   Oil Supply, USA

U.S. crude oil refinery inputs averaged about 17.3 million barrels per day during the week ending June 9, 2017, 29,000 barrels per day more than the previous week’s average. Refineries operated at 94.4% of their operable capacity last week. Gasoline production decreased last week, averaging over 9.8 million barrels per day. Distillate fuel production decreased last week, averaging about 5.2 million barrels per day. U.S. crude oil imports averaged over 8.0 million barrels per day last week, down by 316,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 8.2 million barrels per day, 7.1% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 574,000 barrels per day. Distillate fuel imports averaged 61,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic […]

The Downturn Is Over, But U.S. Oil Companies Face A Huge Problem

14 Jun 2017   Oil Supply, Prices, USA

The downturn may be over, but the oil price crash has left behind potentially long-term consequences for the oil industry. In the wake of the oil price rout that started in 2014, companies slashed expenditures, most notably in their exploration and development budgets—and this lack of investment could have severe ramifications for the oil industry. In 2016, for a second consecutive year, 68 U.S.-listed oil companies indicated in their annual reports that their combined proved liquids reserves dropped, the EIA said in an analysis on Monday. The 68 U.S.-listed oil companies—obliged to report proved reserves annually to the SEC—had their global crude oil and other liquids production averaging 24 million barrels per day (bpd) last year, which accounted for around 25 percent of the world’s total. The proved reserves—the ones that companies believe they can extract from known reservoirs under existing economic and operating conditions—dropped by a net 8.2 […]

Flooded markets mean low gas prices for U.S. commuters

14 Jun 2017   Prices, USA

Refineries leaving the market flush with gasoline and prices are lower year-on-year as a result, motor club AAA said in a weekly retail market report. File photo by Eduardo Sverdlin/UPI. June 13 (UPI) — The gasoline market in the United States is flooded, meaning most consumers are paying less at the pump than they were last year, AAA reported. The motor club reported a national average retail price for a gallon of regular unleaded gasoline at $2.33 for Tuesday, a slight decline from the previous day, relatively stable from last week and only about a penny less than this time last month. On this date in 2016, the national average price was $2.38 per gallon. In a weekly retail market report, AAA said high levels of crude oil in storage, coupled with a surge in gasoline production at the nation’s refineries, led to the decline in retail prices. “If […]

U.S. withdrawal from Paris climate deal unlikely to impact emissions

14 Jun 2017   Climate, USA

U.S. President Donald Trump leaves after attending an event welcoming the Clemson Tigers, the 2016 NCAA Football National Champions, at the White House in Washington, U.S. June 12, 2017. The withdrawal of the United States from the Paris climate pact is unlikely to have a direct impact on the expected decline in global carbon emissions, BP’s chief economist said on Tuesday. “Nearly all the improvement in (carbon reduction) comes from the developing world, it isn’t coming from OECD or America,” Spencer Dale said during a presentation of BP’s annual Statistical Review of World Energy. The reduction in U.S. greenhouse gas emissions in recent years has been a result of cheaper natural gas pushing out more polluting coal rather than regulations, he said. (Reporting by Ron Bousso; editing by David Clarke)

Could Russian Hackers Cause Power Outages In The US?

14 Jun 2017   Russia, USA

Hackers believed to be allied with the Russian government have devised a cyberweapon that has the potential to be highly disruptive against the world’s electrical systems, researchers have reported. The malware, which researchers have dubbed CrashOverride or Industroyer, is known to have disrupted the electrical system in Ukraine in December, briefly shutting down one-fifth of Kyiv’s electric power. Dragos, one of the cybersecurity firms that identified the malware in a report on June 12, said Russian government hackers had shown an interest in targeting power grids in other countries as well, including the United States. The malware is capable of attacking power systems across Europe and Asia, and “with small modifications” could be used in the United States to cause outages of up to a few days in portions of the grid, Dragos said. With modifications, the malware could also attack other types of critical infrastructure, including local transportation […]

U.S. shale firms more exposed to falling oil prices as hedges expire

13 Jun 2017   Shale Oil, USA

Cash-strapped U.S. shale firms scaled back their hedging programs in the first quarter, leaving them more vulnerable to tumbling spot market prices just after OPEC reached a landmark deal to curb global supply. The pullback in hedging was driven by rising service costs and expectations that prices would continue to rally after the Organization of the Petroleum Exporting Countries extended those cuts in May, analysts said. However, rising U.S. production has stymied OPEC’s efforts to rebalance markets. Crude oil futures have lost 15 percent of their value since February, raising the risk that unhedged companies are more exposed to market weakness. The market peaked at $55 a barrel in January as cuts got under way, but […]

U.S. Rig Count Continues Its Ascent Unabated

13 Jun 2017   Shale Oil, USA

The number of active oil and gas rigs in the United States rose again this week by 11—making it 21 weeks of consecutive gains—the longest growth streak since at least 1987, which is the earliest date that Baker Hughes Excel data is available. As if the 11 rigs added to the U.S. repertoire weren’t enough, Canada added 33 rigs this week as well. The number of oil rigs in operation increased by 8, while gas rigs increased by 3. Combined, the total oil and gas rig count in the U.S. now stands at 927 rigs, which is 513 rigs over a year ago today, when oil prices were significantly higher than they were today. (Click to enlarge) It would appear that there is no end in sight to the steady stream of oil rigs being put into play in the U.S. shale patch, and according to Rystad Energy , […]

America’s Stubborn Oil-Supply Glut Catches Funds Off Guard

13 Jun 2017   Oil Supply, Prices, USA

Money managers’ net-long position at most bullish since April Longs rose, shorts declined, just before oil slumped 5 percent Crude markets are taking oil optimists by surprise yet again. Hedge funds boosted bets on a rally just before West Texas Intermediate prices tanked from a report showing surging American stockpiles. Wagers rose 7.3 percent to the highest since April in the week through June 6, U.S. Commodity Futures Trading Commission data show. The next day, futures fell the most since March and are lingering near this year’s lows. “The last thing the market needed to see was that inventories in the U.S. went up, when they are supposed to be going down seasonally,” Tamar Essner, an energy analyst at Nasdaq Inc. in New York, said by telephone. The report “shows that there are some bulls that are starting to get more interested in the market, but I imagine that […]

How Big Is California’s Oil And Gas Industry?

12 Jun 2017   Oil Supply, USA

Petroleum industry’s total economic value for California—larger than 15 U.S. state economies A new economic study released today by The Los Angeles County Economic Development Corporation (LAEDC) details the oil and gas industry’s sizable economic and fiscal impacts on California’s economy and also identifies the user industries of refined products and quantifying their economic activity today. The Western States Petroleum Association (WSPA) commissioned the LAEDC to study the economic contribution of the oil and gas industry in California for the year 2015, as well as identifying user industries of refined products most vulnerable to cost increases, supply restrictions and competitive pressures from outside the state. Oil & Gas is major employer, leading economic driver The report shows the oil and gas industry as a major employer and leading economic driver in California, responsible for 368,100 jobs in 2015, or 1.6 percent of California’s employment, with almost $66 billion in […]

Trump criticises Qatar for funding terrorism at ‘high level’

10 Jun 2017   Qatar, USA

Donald Trump accused Qatar of funding terrorism at a “high level”, just hours after his secretary of state urged Saudi Arabia and its allies to end a blockade of the gas-rich state because it was creating economic hardship and hitting counter-terrorism efforts.  Speaking from the White House, Mr Trump said Qatar “has historically been a funder of terrorism at a very high level”. His comments came at the end of a week that saw Saudi Arabia, the United Arab Emirates, Bahrain and Egypt sever ties with the Gulf state over what they said were concerns that it was fuelling terrorism and supporting Shia proxies of Iran.  Mr Trump said Saudi Arabia and other nations had talked to him about confronting Qatar in the wake of his recent visit to Riyadh.

U.S. drillers add oil rigs for record 21st week in a row: Baker Hughes

10 Jun 2017   USA

U.S. energy firms added oil rigs for a record 21st week in a row, extending a year-long drilling recovery as producers boost spending on expectations crude prices will rise in future months. Drillers added 8 oil rigs in the week to June 9, bringing the total count up to 741, the most since April 2015, energy services firm Baker Hughes Inc said on Friday. That is more than double the same week a year ago when there were only 328 active oil rigs. The pace of those additions has slowed with a decline in crude prices over the past two months, with the average total added over the past four weeks falling to just 7. U.S. crude futures were trading around $46 a barrel, putting the front-month on track […]

States Tell EPA They’ll Fight Should U.S. Relax Vehicle Emissions Rules

10 Jun 2017   Air Quality, USA

More than a dozen state attorneys general wrote to the head of the Environmental Protection Agency vowing a legal fight to block regulators from easing vehicle-emissions standards, the latest broadside in a battle over the Trump administration’s move to reopen a review of the regulations. New York Attorney General Eric Schneiderman and 12 other attorneys general sent a letter to EPA Administrator Scott Pruitt late Thursday, threatening to take the agency to court should U.S. officials relax the standards when the…

U.S. Rig Count Continues Its Ascent Unabated

10 Jun 2017   USA

The number of active oil and gas rigs in the United States rose again this week by 11—making it 21 weeks of consecutive gains—the longest growth streak since at least 1987, which is the earliest date that Baker Hughes Excel data is available. As if the 11 rigs added to the U.S. repertoire weren’t enough, Canada added 33 rigs this week as well. The number of oil rigs in operation increased by 8, while gas rigs increased by 3. Combined, the total oil and gas rig count in the U.S. now stands at 927 rigs, which is 513 rigs over a year ago today, when oil prices were significantly higher than they were today. (Click to enlarge) It would appear that there is no end in sight to the steady stream of oil rigs being put into play in the U.S. shale patch, and according to Rystad Energy , […]

Drivers Head Into Summer With a Gift at the Gas Pump

10 Jun 2017   Prices, USA

Looking for an excuse to pack up the car for a road trip this weekend? Look no further: The average nationwide gasoline price on Friday was the lowest for this point of the year since 2005, according to GasBuddy , a website and smartphone app designed to help drivers find the best deals at the pump. The immediate cause of the price break was the shock to global oil markets that came when the Energy Department reported this week that domestic inventories of both crude oil and gasoline had surprisingly surged the week before despite heavy driving on the Memorial Day weekend. Crude oil prices plummeted by more than 5 percent on Wednesday alone, and are near a one-year low at less than $46 a barrel. The price drop has been all the more remarkable given that the Organization of the Petroleum Exporting Countries has imposed a […]

Comey testimony fuels push for new US sanctions on Russian energy sector

10 Jun 2017   Russia, USA

Comey testimony may increase odds of new sanctions Senate Republicans and Democrats negotiating new sanctions amendment McCain pushing new sanctions targeting Russian energy sector Former FBI Director James Comey told a US Senate panel Thursday he had no doubt the Russian government was behind hacks in last year’s US presidential election, testimony which could motivate the Senate to approve new sanctions on Russia’s energy sector as early as next week. Comey told the Senate Intelligence Committee he was sure the Russian government had interfered in the presidential race between Hillary Clinton and now-President Donald Trump, including cyber intrusions in voter databases and email accounts at the Democratic Party and Clinton campaign. This, along with other revelations made during Comey’s testimony before the Senate committee “could stoke anti-Russia sentiment and increase the odds of new Congressional sanctions,” according to analysts with ClearView Energy Partners. Article continues below… Oilgram News brings […]

U.S. Begins Importing Iraqi Oil

9 Jun 2017   Iraq, USA

The United States has begun importing Iraqi oil at a rate of 1.1 million barrels per day to replace export cuts announced by Saudi Arabia late last month , new figures compiled by Bloomberg show. New data from the Department of Energy suggests that during the first week of June, Iraqi oil entered the U.S. at the quickest rate in the past five years – marking the first time the nation’s exports exceeded those from Saudi Arabia over the same time period. In late May, Riyadh announced its plans to purposely reduce exports to the United States to force a reduction in the latter’s sizeable inventories, which are preventing a greater rise in global oil prices, according to Saudi Oil Minister Khalid Al-Falih. Earlier that same month , Saudi Aramco said it would cut crude supplies to China, South Korea, and South East Asia by 1 million barrels each. […]

U.S. rig count doubled from last year

9 Jun 2017   Shale Oil, USA

The number of rigs targeting oil and gas reserves in the United States in May was double the level from last year, Baker Hughes reported. Rig counts serve as a loose metric to gauge the industry’s interest in spending on exploration and production in a particular sector. A report last year from consultant group IHS Markit found new production from the heavier oil sands in Canada, for example, needed crude oil prices higher than $70 per barrel in some cases to get off the ground. U.S. shale oil basins, meanwhile, have become more efficient and therefore more resilient to a weaker market. Oilfield services company Baker Hughes reported a net gain in North American rig counts, […]

Summary of Weekly Petroleum Data for the Week Ending June 2, 2017

9 Jun 2017   Oil Supply, USA

U.S. crude oil refinery inputs averaged over 17.2 million barrels per day during the week ending June 2, 2017, 283,000 barrels per day less than the previous week’s average. Refineries operated at 94.1% of their operable capacity last week. Gasoline production decreased last week, averaging over 9.9 million barrels per day. Distillate fuel production increased last week, averaging about 5.3 million barrels per day. U.S. crude oil imports averaged over 8.3 million barrels per day last week, up by 356,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged 8.3 million barrels per day, 8.8% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 787,000 barrels per day. Distillate fuel imports averaged 152,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum […]

EIA STEO highlights: US oil output nears new record

7 Jun 2017   USA

US crude oil production will, for the first time in nearly 50 years, climb to 10 million b/d by March 2018, the US Energy Information Administration said Tuesday. Such a level would mark the highest daily US production rate since November 1970, when production climbed to nearly 10.05 million b/d and averaged about 9.64 million b/d for that year, according to government data. The November 1970 figure remains the all-time high. “Increased drilling activity in US tight oil basins, especially those located in Texas, is the main contributor to oil production growth, as the total number of active rigs drilling for oil in the United States has more than doubled over the past 12 months,” Howard Gruenspecht, the EIA’s acting administrator, said in a statement. In its latest Short-Term Energy Outlook, EIA said it sees US crude output averaging 9.33 million b/d this year and 10.01 million b/d in […]

US utilities’ coal consumption climbs in May: EIA

7 Jun 2017   Coal, USA

Warmer weather and higher natural gas prices helped to increase utility coal burn in May, the US Energy Information Administration said Tuesday. In its latest monthly Short-Term Energy Outlook, the EIA estimated coal consumption increased by 24.4% or 9.6 million st month on month to 48.9 million st. EIA said coal accounted for 27.6% of May generation, compared with 32% from gas-fired facilities. In April, coal accounted for 25% of generation and gas 31.5%. Platts Coal Trader provides the latest prices for key benchmark coals, as well as: Daily pricing for tons and allowances for SO2 and NOx emissions The exclusive Platts OTC Broker Index, a market assessment compiled from three of the largest and most respected coal brokers What happened in yesterday’s OTC markets, and why An analysis of coal price trends in all major U.S. producing areas Details of how major coal companies are trading in the […]

Oil Drops as Industry Data Shows Surge in U.S. Gasoline Supplies

7 Jun 2017   USA

Motor fuel inventories up 4.08 million barrels last week: API Crude output forecast to rise above 10 million barrels a day Oil declined as U.S. industry data showed gasoline stockpiles expanded at a time they typically fall, suggesting the crude surplus is turning into an overhang of refined fuels. Futures slid 0.6 percent in New York. The American Petroleum Institute was said to report late Tuesday that stockpiles of the motor fuel increased by 4.08 million barrels last week. Government data Wednesday is forecast to show supplies fell for a fifth week. Royal Dutch Shell Plc lifted restrictions on exports of a key Nigerian crude oil halted for more than a year, potentially undermining the efforts of other OPEC members to clear a glut. Oil has struggled to stay above $50 a barrel amid speculation that rising U.S. output will counter supply curbs by the Organization of Petroleum Exporting […]

America’s Unstoppable LNG Boom

7 Jun 2017   LNG, USA

Since Cheniere sent America’s first LNG cargo abroad in early 2016, U.S. gas exports have reached buyers in Latin America, Europe, Asia, and even the Middle East. The shale gas boom allowed the U.S. to send cargoes overseas, easing some of the domestic glut, with exports hitting a new monthly record in May. Last month, 18 cargoes departed from Sabine Pass—so far the only LNG export facility in the U.S.—totaling approximately 61 Bcf, a new monthly record, the EIA said in its Natural Gas Weekly Update for the week ending May 31. America’s LNG has reached the world fastest-growing LNG import market, Asia, and markets in the Middle East. In a few days, cargoes from Sabine Pass will call at Rotterdam for a first Northwest Europe destination, and to Poland—a first delivery to a country in Central and Eastern Europe, where Russia’s Gazprom reigns supreme. Since February 2016, U.S. […]

Tillerson: Paris not an isolationist move

7 Jun 2017   Climate, USA

U.S. Secretary of State Rex Tillerson tells his counterparts in New Zealand the decision to step away from the Paris climate treaty wasn’t an isolationist move by the Trump administration. File Photo by Sergei Chirikov/EPA June 6 (UPI) — President Trump acted in the people’s best interest with his decision on the Paris climate treaty and is not an isolationist, his secretary of state said. President Donald Trump sparked international critiques with a decision to end the U.S. role in the Paris climate treaty, which would require about three years for a full withdrawal from the international accord. The president said he’d consider some sort of renegotiated role and Secretary of State Rex Tillerson defended the move as a decision that served the interests of the American people. “Having said that, as he made that decision, I think he made clear that he welcomes the opportunity to talk about […]

More offshore oil openings from Trump draw criticism

7 Jun 2017   Offshore, USA

The White House took another step to opening up offshore oil and gas reserves using a method that an industry critic said poses a real ecological threat. The office of President Donald Trump issued a draft for public comment in the federal registry for seismic airgun blasting in the Atlantic Ocean. The practice is used to get a better understanding of the reserve potential in a particular basin, though advocacy group Oceana said the method endangers marine mammals that use sound to function as species. Nancy Pyne, a campaign director for Oceana, said the risk is elevated because of the steady stream of Trump initiatives aimed at unraveling the environmental legacy of […]

Supply and demand factors leave U.S. gas prices stable

7 Jun 2017   Prices, USA

U.S. consumer demand isn’t strong enough to match refinery output, leaving gas prices relatively stable as summer travel season kicks in, AAA reported. The motor club reported a national average price for a gallon of regular unleaded gasoline at $2.37 for Tuesday, down a fraction of a percent from the previous day, and more or less unchanged from last week . Compared with a month ago, the price at the pump is about a half percent higher. Gas prices on this date in 2016 were lower by only 0.4 percent, or about a penny. Wide swings in some markets skewed the national average price somewhat as AAA said retail gasoline prices dropped in 60 percent of the U.S. states. […]

Oil production in the Gulf of Mexico shows resilience

With crude oil prices in May holding above the $50 mark, analysis finds the U.S. Gulf of Mexico saw gains in exploration and production activity. Platts RigData, a forecasting unit within pricing group S&P Global Platts, revealed a total U.S. rig count for May at 1,026, up 6 percent from the previous month and more than double the level from one year ago. The U.S. waters of the Gulf of Mexico were the only production centers in the United States to show a decline in rig activity from last year, with the May level of 36 down 16 percent from last year, but a slow recovery is apparent. Eight new fields in the U.S. waters of […]

US falling behind in energy technology, say generals

7 Jun 2017   USA

The US is falling behind other countries in advanced energy technologies, threatening national security and undermining its global influence, former generals and admirals in the US military are warning the Trump administration. The CNA Military Advisory Board, a Virginia-based think-tank, argues that the US should “take a leadership role in the transition to advanced energy” by stepping up research and development of technologies such as renewables, nuclear power, energy efficiency and electricity storage. The military officers’ conclusions, which were due to be presented to US government officials on Tuesday, follow warnings from businesses that President Donald Trump’s decision to withdraw from the Paris agreement on climate change could undermine the country’s advanced energy industries. Many analysts have discussed the geo-political and national security significance of the shale revolution, which has cut US energy imports and turned the country into an exporter of gas to the Middle East and crude oil to China. CNA’s former military leaders argue that the advanced energy revolution, driven by the plunging cost of renewable generation and battery storage, also has important consequences for US strategy.

Worst Hurricane Season In A Decade Threatens Gulf Coast Production

5 Jun 2017   Climate, USA

2017 could be an “above-normal” year for large hurricanes, according to the National Oceanic and Atmospheric Administration (NOAA), a potential problem for Gulf Coast oil drillers and refiners. NOAA puts the odds of an “above-normal” season for hurricanes at 45 percent, while the chances of a normal and below-normal season are at 35 and 20 percent, respectively. In fact, they said that there is a 70 percent likelihood of 11 to 17 named storms, which are storms that have 39 mile-per-hour winds or higher. About 5 to 9 of those could become hurricanes (winds of 74 mph or higher); 2 to 4 of which could become major hurricanes (winds of 111 mph or higher). The average season (which runs from June through November) tends to have just 12 named storms, so the potential for 17 named storms puts the 2017 hurricane season in more treacherous territory. “We’re expecting a […]

Oil Prices Fall As U.S. Rig Count Rises For 20th Straight Week

3 Jun 2017   USA

The number of active oil and gas rigs in the United States rose for the twentieth straight week, Baker Hughes reported on Friday—this time by 8, as drillers in the US make do with current barrel prices even below $50. The number of oil rigs in operation increased by 11, while gas rigs decreased by 3. Combined, the total oil and gas rig count in the US now stands at 916 rigs—more than double the number of rigs in operation a year ago, when WTI barrel prices were about $49.05—higher than today’s price per barrel for WTI. Say what they will about rebalancing the oil market—even if they say it again and again—OPEC and its non-OPEC counterparts have been unable to swing prices (and keep them) near $60 per barrel. Undeterred and even seemingly satisfied with the current pricing environment, shale players in the US are showing no signs […]

Americans Are Doing Everything They Can to Drain Oil Inventories

1 Jun 2017   Oil Supply, USA

U.S. crude exports and refinery inputs advance to records Gas-guzzling is hot again as demand hits highest level ever There’s a loud sucking sound coming from the depths of oil storage tanks across the United States. The combined effort of American drivers, gung-ho refiners and exporters are starting to reduce the nation’s oil stockpiles, an outcome that the Organization of Petroleum Exporting Countries has been hoping to see since it agreed to cut production in November. Last week total U.S. crude exports, gross refinery inputs and demand for gasoline all pushed to records in weekly preliminary data released Thursday by the U.S. Energy Information Administration. “Refinery runs are ridiculous. I posted a meme where it’s the line from Top Gun,” said Mason Hamilton, an EIA analyst by phone from Washington, D.C. “‘I feel the need to run the refinery full out.’ Maybe U.S. refiners were inspired by last week’s […]

Oklahoma raises tax on energy industry to offset economic strains

1 Jun 2017   USA

Oklahoma Gov. Mary Fallin draws criticism from oil and gas trade group for raising production taxes in an effort to close a gap in the state budget. Pool Photo by Aude Guerrucci /UPI June 1 (UPI) — The budget for fiscal year 2018 in shale-rich Oklahoma sends about $7 billion to state agencies, but remains off $37 million from this year, the governor said. Gov. Mary Fallin signed off on a new budget that her office said closes an $878 million gap while keeping social services like hospitals and nursing homes running. The 2018 budget is $37.7 million, or about a half percent, lower than the appropriated budget for this year. In a nod to a weakened energy market, where crude oil prices are still about half what they were three years ago, the governor said a 3 percent increase in gross production tax would help keep the state […]

Carlyle OFS Exec: It’s Dangerous to Declare Industry in Recovery

1 Jun 2017   Offshore, USA

Carlyle Group principal cautions crowd at Louisiana Energy Conference that not all of the oil and gas industry is rebounding as conventional and offshore service companies continue to struggle. An uneven recovery is taking hold of the oil and gas industry, and if folks don’t realize that some sectors continue to struggle, industry exuberance can quickly retreat to the downturn’s despair. Stuart Page, principal in oilfield services and equipment at The Carlyle Group, said taking the same approach to the post-downturn economy as the one that led to plummeting commodity prices will imperil the industry. “I think it’s dangerous that we’re all looking at this as the new recovery. If everybody thinks the same thing, we’re all going to apply the same [excessive] valuations, we’re going to end up with the same problem all over again,” Page said during a panel at the Louisiana Energy Conference in New Orleans […]

Cushing hub’s crude storage shell, working capacity edges lower: EIA

1 Jun 2017   USA

Crude oil storage shell capacity at Cushing, Oklahoma, fell to 90.1 million barrels as of March 2017 from 90.4 million barrels six months ago, data from the U.S. Energy Information Administration (EIA) showed on Wednesday. Working storage capacity at the U.S. crude hub fell to 76.7 million barrels from 77.1 million barrels in the same comparison, EIA data showed. U.S. Gulf Coast crude oil shell capacity rose to 301.3 million barrels as of March, up from 291.3 million barrels. U.S. Gulf Coast working capacity also rose, increasing to 260.3 million barrels from 250.5 million barrels in September 2016. (Reporting by Catherine Ngai)

US NRC approves new nuclear unit for Dominion’s North Anna plant in Virginia

1 Jun 2017   Nuclear, USA

Commissioners of the US Nuclear Regulatory Commission voted Wednesday to authorize NRC staff to issue a combined construction permit-operating license to Dominion Virginia Power to build a third power reactor at its North Anna plant in Mineral, Virginia. NRC staff completed its environmental review of the application in February 2010 and issued its safety evaluation report in January, finding that no environmental or safety issues preclude issuance of the COL. The commission said in a memorandum and order issued Wednesday after its vote that NRC staff’s safety and environmental reviews met regulatory requirements. The commission authorized the director of the agency’s Office of New Reactors to issue the COL. That office “expects to issue the license in the next couple of days, as the review process is now complete,” NRC spokesman Scott Burnell said Wednesday in an email. Article continues below… NRC said in a statement Wednesday that the […]

Strong start to summer driving season pushed U.S. oil rises towards $50

31 May 2017   USA

U.S. crude oil prices rose toward $50 per barrel on Tuesday as a strong start to the summer driving season in the United States suggested strong fuel demand in months ahead. U.S. demand for transport fuels such as gasoline used in cars and diesel in buses tends to rise significantly as families visit friends and relatives or go on vacation during the summer months, with the so-called summer driving season officially kicking off on the Memorial Day holiday at the start of this week. U.S. West Texas Intermediate (WTI) crude futures CLc1 climbed above $50 per barrel in early trading on Tuesday, and were at $494.97 per barrel at 0032 GMT, still up 17 cents from their last settlement. “The start of the U.S. driving season … boosted confidence in the market that stockpiles would start to fall in coming weeks,” ANZ bank said on Tuesday. The American Automobile […]