USA

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 […]

First US Bakken crude set to arrive in Asia mid-May:

27 Apr 2017   Shale Oil, USA

The first cargo of US Bakken crude is heading to Asia, adding to the widening list of western crude moving eastward amid the narrowing spread between low sulfur crude in the West against high sulfur crude in the East. Western trading firm Mercuria Energy has chartered a vessel to move a cargo of the crude, which has a gravity of 43 API, into Asia for the first time ever, according to a source close to the matter. The crude has been co-loaded with US Mars crude on the VLCC Maran Canopus, traders said. The VLCC left the US Gulf Coast on March 20 and is due to arrive in Singapore on May 13, according to cFlow , S&P Global Platts trade flow software. The vessel is currently located off the coast of South Africa. It is unclear however, if the cargo has a final outlet. Article continues below… Oilgram […]

U.S. Power Demand Flatlined Years Ago, and It’s Hurting Utilities

26 Apr 2017   USA

Utility CEOs seek new ways to profit amid historic shift Renewables also cutting in on power generation monopoly Electric utilities have been doing everything they can to preserve their bottom line from conducting multi-billion mergers to snapping up more profitable natural gas businesses. Their trouble lies in one thing they can’t control: demand. Power consumption in the U.S. has stalled for the last decade, breaking the link the industry has enjoyed with economic growth. For more than a century after Thomas Edison invented the light bulb in the 1870s, electricity demand rose steadily, boosting utility profits in the process. The lull couldn’t have come at a worse time for the industry, which is already struggling with the end of their historic monopolies. Power-sipping appliances, LED lighting and a shift away from heavy industry all have contributed to the slowdown, and that’s forcing traditional generators from Duke Energy Corp. to […]

Perry Says Trump Should Keep Paris Climate Deal and Renegotiate

26 Apr 2017   Climate, USA

Energy secretary says he won’t advise Trump to abandon UN deal Perry criticizes Germany for allowing emissions to rise U.S. Energy Secretary Rick Perry said the U.S. should renegotiate the Paris accord on climate change instead of abandoning it, criticizing Germany for allowing its fossil-fuel emissions to rise. “I’m not going to tell the president of the United States to walk away from Paris accord,” Perry said at the Bloomberg New Energy Finance conference in New York on Tuesday. “I will say that we need to renegotiate it.” US @SecretaryPerry will recommend @POTUS renegotiate the Paris agreement; asks EU countries for fewer words, more action. #BNEFSummit pic.twitter.com/3XmDLApkwr — BloombergNEF (@BloombergNEF) April 25, 2017 The remark puts Perry among a group of advisers urging President Donald Trump to stick with the United Nations accord that he vowed to scrap during his campaign last year. The White House has said it […]

Baker Hughes sees chance of mid-2017 rebound

26 Apr 2017   Oil Supply, USA

Industry headwinds remain in some business segments because the global oil and gas sector hasn’t fully recovered from 2016, Baker Hughes reported. The company has reported steady gains in North American exploration and production figures, released as weekly rig counts. Spending on exploration and production plummeted last year after crude oil prices collapsed to below $30 per barrel, but the appetite for 2017 has improved since members of the Organization of Petroleum Exporting Countries agreed to cap production to offset supply-side strains. The company reported a 15.3 percent decline in quarterly revenue to $2.26 billion as North American activity was not enough to compensate for lags elsewhere. “While the onshore rig count increase in North America has been more robust than […]

U.S. gas prices continue slow summer rise

26 Apr 2017   Prices, USA

The price for a gallon of gasoline in the United States is on the increase and could move higher as summer demand figures into market metrics, analysis finds. Motor club AAA reports a national average retail price for a gallon of regular unleaded gasoline at $2.42, relatively unchanged from last week, but 13 cents higher than one month ago. Refiners are moving forward with a summer blend of gasoline, which is more expensive to make because of the additional environmental safeguards needed in warmer months. Coupled with the expected rise in demand, AAA said it expects gas prices to move steadily higher. “As gas prices continue to reach new heights and hit an all-time high for the year, the summer demand has not kicked in, […]

Unsung Gulf of Mexico Tracks New Crude Oil Production Record

26 Apr 2017   Offshore, USA

Permian Basin hoards the spotlight, but meanwhile, offshore producers are a fraction of a percentage point away from hitting another all-time high during the first half of the year, according to RBN Energy. Far from the $40,000 per acre land rush for shale in the Permian Basin, operators in the Gulf of Mexico are toiling offshore to outpace their own production records. In January, Gulf of Mexico (GOM) production totaled 1.75 million barrels per day, less than a percentage point away from the previous record set in 2009, according to Housley Carr, an analyst at RBN Energy LLC. Within the next month or so, the 2009 record is expected to fall. By 2018, the U.S. Energy Information Administration (EIA) expects a total of 1.9 million barrels per day in 2018, Carr noted in an April 24 report. “Admittedly, that’s an increase of only [300,000 barrels per day] from 2016, […]

Trump to Order Review of 1906 Monuments Law to Help Oil, Mining

26 Apr 2017   USA

Executive order to seek review of Antiquities Act designations National monuments puts land off limits to energy development President Donald Trump will order a review of as many as 40 large national monuments that have been declared over the past two decades, beginning a process that could lead to the repeal of protections for those lands and new opportunities for oil and mining companies. Interior Secretary Ryan Zinke — whom Trump will task with the review in an order set to be signed Wednesday — told reporters it is meant to ensure local communities have a chance to weigh in on the set-aside of lands. Zinke will have 45 days to come up with preliminary determinations on which, if any, monument declarations should be redrawn or yanked. “The concern that I have and the president has is the local community affected should have a voice,” Zinke said. The order […]

Atlantic storm season starts early, putting energy industry on notice

25 Apr 2017   USA

Atlantic hurricane season can cause power outages and high gas prices for consumers and the year is off early with Tropical Storm Arlene, forecasters note.  Arlene was only the second such tropical storm observed in April in the Atlantic Ocean. Forecasters for the U.S. National Hurricane Center said Friday that detecting a storm as weak as Arlene was “practically impossible” before the modern weather-satellite era.  Genscape, which provides energy market data, said power plants may be affected differently as the season moves closer to its official start.  “As production continues to shift to inland regions and hurricane activity in the Gulf remains below average, Genscape is seeing the impact from hurricanes shift from production-destruction to impacting demand through shifts in temperatures,” it said in a commentary on Arlene.  Hurricane Matthew was a Category 3 storm when it hit the east coast of Florida in early October. The U.S. Energy Information Administration estimated about 2.5 million residential, commercial, and industrial electricity customers lost power across five states because of Matthew.  Motor club AAA reported that Matthew forced the closure of fuel terminals in Florida, Georgia and South Carolina. Most of the coastal ports reopened in the region by the time remnants of Matthew moved out to sea, however the storm caused short-term gasoline shortages and skewed the national average price at the pump higher.

View full article at www.upi.com

People aren’t buying enough gas

25 Apr 2017   USA

U.S. gasoline futures were down more than 1 percent on Monday, reflecting demand concerns as refiners emerge from the winter maintenance season and prepare to turn out more fuel. Meanwhile, U.S. crude settled 39 cents lower at $49.23, extending last week’s deep losses. “As gas prices drop, that creates an undertow for the entire crude oil market,” said Tom Kloza, global head of energy analysis at Oil Price Information Service. Part of the problem is a tough comparison with extraordinarily low gasoline prices last year. The national average gasoline price on Monday was nearly 28 cents above last year’s level, according to GasBuddy.com. “I’m in the camp that says last year was a little bit of the anomaly,” Kloza said. “Gas was so cheap that we drove a little bit more almost capriciously. This year, I just don’t think it’s going to happen.” In a troubling sign, the nation’s […]

East Coast refiners eye Texas oil as North Dakota alternative

25 Apr 2017   Shale Oil, USA

U.S. East Coast refiners are looking to buy increasing volumes of domestic crude oil from the Gulf Coast, two sources said, the latest twist in a trade flow upheaval in the wake of the opening of the Dakota Access pipeline. Major U.S. East Coast refiners profited from railing hundreds of thousands of barrels of discounted Bakken crude to their plants daily from 2013 until 2015. But as more and more pipelines were built in North Dakota, the discount began to disappear, and so did the rail cars. Now, at least two East Coast refiners, Phillips 66 ( PSX.N ) and Delta Air Lines Inc’s ( DAL.N ) subsidiary Monroe Energy, are looking to move more crude […]

Trump to sign offshore orders as 100th day in office, shutdown near

25 Apr 2017   Offshore, USA

Ahead of his 100th day in the White House on Saturday, President Trump is expected this week to unveil details of major policy initiatives, including executive orders aimed at expanding oil and natural gas drilling in federal waters and an outline of his tax reform goals. The week will also be complicated by ongoing negotiations with Congress to keep the federal government from shutting down on Friday, as occurred in 2013. These negotiations appear to be centered on funding for Trump’s border wall. While the border wall is a thorny issue for many Republicans and a nonstarter for Democrats, White House Chief of Staff Reince Priebus said the administration expects Trump’s “priorities” to be included in the spending bill Congress needs to pass by midnight Friday to avoid shutdown. “So we expect a massive increase in military spending,” Priebus said Sunday on NBC’s “Meet the Press.” “We expect money […]

U.S. Treasury says it will not issue drilling waivers to Russia sanctions

22 Apr 2017   Russia, USA

U.S. Treasury Secretary Steven Mnuchin arrives to meet with China’s Finance Minister Xiao Jie during the IMF/World Bank spring meetings in Washington, U.S., April 21, 2017. The U.S. Treasury will not give permission to U.S. companies, including Exxon Mobil Corp, to drill in areas prohibited by U.S. sanctions on Russia, Treasury Secretary Steven Mnuchin said on Friday. Mnuchin said in a statement that the decision had been made in consultation with President Donald Trump. (Reporting by Yeganeh Torbati; Editing by Andrew Hay)

Exxon Won’t Get Drilling Waiver for Russia, Mnuchin Says

22 Apr 2017   Russia, USA

Exxon Mobil Corp. won’t be allowed to bypass U.S. sanctions against Russia to resume drilling for oil in a joint venture that seeks to tap billions of barrels of that country’s crude. Treasury Secretary Steven Mnuchin said the decision was made after consultation with President Donald Trump, according to a statement on Friday. Exxon initially requested the drilling waiver in 2015 and pushed for approval every few months since then, according to a person with knowledge of the matter who wasn’t authorized to speak publicly. The waiver request drew criticism from a cross-section of leading U.S. policymakers, from Republican Senator John McCain, who wondered in a tweet whether Exxon was “crazy,” to Senator Bob Menendez, a New Jersey Democrat and sanctions hardliner who sits on the Senate Foreign Relations Committee. “We understand the statement today by Secretary Mnuchin in consultation with President Trump,” Alan Jeffers, an Exxon spokesman, said […]

U.S. Oil Drilling Growth Shows First Signs of Cooling Off

22 Apr 2017   Shale Oil, USA

U.S. oil drillers slowed the pace of a months-long expansion as investors worry that growing shale production will ruin OPEC’s efforts to prop up prices. Drillers added 5 rigs targeting crude this week, bringing the total to 688, according to Baker Hughes Inc. data reported Friday. While all four of the biggest oil basins boosted activity this week, the handful of rigs added is the smallest amount of growth in nearly two months. The number of working rigs has more than doubled from a 2016 low of 316 in May, often expanding weekly by double digits, with as many as 29 rigs added during one week in January. Crude dropped below $50 Friday on concerns that surging U.S. production could undermine OPEC’s efforts to reduce global supplies. “It’s not surprising to see the rig count continue to build from the carryover from recently higher commodity prices,” Luke Lemoine, an […]

Schlumberger posts yearly gain on North American oil recovery

22 Apr 2017   USA

Gains in first quarter activity in North America were offset somewhat by declines in Russia and parts of Europe, oilfield services company Schlumberger said. Most first quarter indicators for the largest company of its kind in the world were lower, both when compared to the fourth quarter and year-over-year. First quarter revenue of $6.9 billion was down 3 percent compared to the previous term, but up 6 percent from first quarter 2016. The market downturn characterized by historically low crude oil prices last year sidelined companies like Schlumberger as investments in exploration and production dwindled. Crude oil prices pulled out of a historic slump last year after members of the Organization of Petroleum Exporting Countries agreed to curb production in an effort […]

Massive Natural Gas Deposit Discovered In The Gulf Coast Basin

22 Apr 2017   Shale Gas, USA

Technological advancements have just pushed the boundaries of recoverable oil and gas in the U.S. further, according to an announcement by the U.S. Geological Survey. The agency reported that two formations in the Gulf Coast Basin may contain as much as 304.4 trillion cubic feet of natural gas plus 1.9 billion barrels of natural gas liquids, making the area the largest untapped continuous gas deposit in the country. The two formations—Haynesville and Bossier—also contain some 4 billion barrels of crude, according to mean estimates, the USGS also said in a press release. (Click to enlarge) Most of the newly recoverable gas is in the Haynesville formation, which contains around 195.8 trillion cubic feet. It also holds 900 million barrels of natural gas liquids and some 1.1 billion barrels of oil. The rest is in the Bossier formation. The USGS has been reassessing a lot of oil and gas deposits […]

US E&P Budgets Rebound, Grow For First Time Since 2014 Downturn

22 Apr 2017   Oil Supply, USA

Exploration and production (E&P) spending in the United States will increase this year for the first time since the 2014 downturn, which roiled the industry for two years rife with lay-offs and bankruptcy filings.  Increasing capital expenditures (CAPEX) is expected to drive production up this year by 5 percent, according to Fitch Ratings’ measurement across 40 U.S. E&Ps. Total drilling and completion spending is on the rise, too, increasing by roughly 58 percent.  Most of the CAPEX is dedicated toward highest-return shale plays, especially the Permian Basin, Eagle Ford, STACK, Haynesville and Marcellus basins, the ratings group said in a statement April 21.

What’s more, the Fitch sample forecasts that land rig counts in the lower 48 will increase up to 65 percent, year-over-year. The pace is likely to slow during the second half of 2017, but still culminate in up to 875 land rigs by year-end.  The disparity between CAPEX and production growth for the year indicates growth will continue next year. Spending more money on the production side – rather than testing and delineation – as well as efficient gains, will further boost 2018 growth, Fitch said.  In August 2016, analysts at RBN Energy, LLC, said E&P CAPEX had likely hit bottom when 46 U.S. E&Ps revealed spending that year at $41 billion – down 51 percent and 70 percent from investment made in 2015 and 2014, respectively.

View full article at www.rigzone.com

Trump denies Exxon permission to drill for oil in Russia

22 Apr 2017   Russia, USA

The Trump administration has denied ExxonMobil permission to bypass sanctions to drill for oil in Russia. “The Treasury Department will not be issuing waivers to U.S. companies, including Exxon, authorizing drilling prohibited by current Russian sanctions,” Treasury Secretary Steven Mnuchin, said in a statement Friday. Mnuchin said he consulted with President Trump on the decision. Exxon had applied for a waiver from sanctions imposed by the Obama administration in a bid to resume its lucrative joint venture with Russian state oil giant PAO Rosneft. In a statement, Exxon said “we understand” the decision by the Treasury Department. Exxon explained that its application for a license was aimed at meeting the company’s “contractual obligations” in Russia, where competitors are allowed to drill under European sanctions. There are powerful reasons why Exxon would want to get back into business with Rosneft: Their agreement to form a joint venture, signed in 2011, […]

1Q Oil, Gas M&A Deals Hit Record $73 Billion

21 Apr 2017   USA

Investors enter 2017 with renewed enthusiasm for oil and gas deals, pushing transaction value 160 percent above last year, but that excitement may be on the wane. Reassured by Donald Trump’s presidential agenda and the relative stability of oil prices once OPEC and non-OPEC countries settled on oil quotas, investors opened 2017 with a record $73.04 billion deals, according to findings by PwC. The investment represents a 160 percent increase in mergers and acquisitions (M&A) deal value, year over year, which includes the return of foreign capital in U.S. shale assets. As for deal volume, 53 were announced during the first quarter, up 36 percent year over year. And yet despite all of this, PwC said there are signals the tide is starting to turn. Commodity prices retreated during the middle of the first quarter and oil and gas equity index declines may have tempered investor exuberance. “As the […]

Exxon Seeks U.S. Waiver to Resume Russia Oil Venture

20 Apr 2017   Russia, USA

Exxon Mobil Corp. has applied to the Treasury Department for a waiver from U.S. sanctions on Russia in a bid to resume its joint venture with state oil giant PAO Rosneft, according to people familiar with the matter. Exxon has been seeking U.S. permission to drill with Rosneft in several areas banned by sanctions and applied in recent months for a waiver to proceed in the Black Sea, according to these people. The…

Exxon Mobil Seeks U.S. Sanctions Waiver for Oil Project in Russia

20 Apr 2017   Russia, USA

Exxon Mobil is pursuing a waiver from Treasury Department sanctions on Russia so it may drill in the Black Sea in a venture with the Russian state oil company Rosneft , a former State Department official said Wednesday. An oil industry official confirmed the account. The waiver application was made under the Obama administration, the officials said, speaking on condition of anonymity, and the company has not dropped the proposal. The proposal is now before the Trump administration at a delicate time in Russian-American relations, with rising tensions over the war in Syria and a looming congressional inquiry into reports of Russian efforts to influence the United States presidential election. The appeal did not come up during Senate confirmation hearings of Secretary of State Rex W. Tillerson , who was Exxon Mobil’s chief executive before his appointment by President Trump and was known to have a strong […]

Summary of Weekly Petroleum Data for the Week Ending April 14, 2017

20 Apr 2017   USA

U.S. crude oil refinery inputs averaged over 16.9 million barrels per day during the week ending April 14, 2017, 241,000 barrels per day more than the previous week’s average. Refineries operated at 92.9% of their operable capacity last week. Gasoline production decreased last week, averaging 9.8 million barrels per day. Distillate fuel production increased last week, averaging just about 5.2 million barrels per day. U.S. crude oil imports averaged over 7.8 million barrels per day last week, down by 68,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged over 7.9 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 843,000 barrels per day. Distillate fuel imports averaged 167,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic […]

Oil Industry Worried About Trump’s “Buy American”

20 Apr 2017   USA

U.S. President Donald Trump signed an executive order on Tuesday that would promote his “Buy American, Hire American” trade policy, an agenda that is worrying oil pipeline companies. Trump’s executive order is vague in details. The “Buy American” part of the executive order seeks to tighten the standards in U.S. government procurement programs, which essentially means that federally-funded construction projects use more American-made goods. It is not at all clear how this will alter current policy. The administration wants to close what it sees as too many loopholes, such as nearly-finished imported goods being completed in the U.S. and then deemed to be “Made in America.” The “Hire American” agenda calls for a reform of the H-1B visa program, which allows companies to hire skilled foreign workers. The executive order, if carried out, would affect companies building oil pipelines in the U.S., requiring them to use U.S. steel in […]

Trump’s EPA To Reconsider Oil And Gas Emissions Rule

20 Apr 2017   Climate, USA

The U.S. Environmental Protection Agency will reconsider a rule on greenhouse gas emissions from oil and gas operations and delay its compliance date, the agency said on Wednesday in the Trump administration’s latest move to reduce regulations. Oil interest groups, including the American Petroleum Institute and the Texas Oil and Gas Association, had petitioned the EPA a year ago to reconsider the rule limiting emissions of methane and other pollutants from new and revamped oil and gas wells and systems. The EPA said in a statement that it would delay the rule’s June 3 compliance date by 90 days and take public comments during that period. Under Democratic President Barack Obama, the EPA released the first methane limits on the facilities in May 2016, […]

Exxon seeks waiver from U.S. sanctions on Russia:

20 Apr 2017   Russia, USA

Exxon Mobil Corp ( XOM.N ) has applied to the Treasury Department for a waiver from U.S. sanctions on Russia as the oil major looks to resume its joint venture with Rosneft ( ROSN.MM ), the Wall Street Journal reported on Wednesday. Exxon has been seeking permission from the United States to drill with the Russian state-owned Rosneft in certain banned areas and applied in recent months for a waiver to proceed in the Black Sea, the newspaper reported, citing people familiar with the matter. ( on.wsj.com/2osAxzB ) The company wound down drilling in Russia’s Arctic in 2014 in the face of U.S. sanctions targeting cooperation between Western companies and Moscow’s oil sector. Exxon and Rosneft in 2012 unveiled an offshore exploration partnership that could […]

Bankruptcy leads to closure of platform offshore California

19 Apr 2017   Offshore, USA

The pending closure of an oil installation offshore California because of a corporate bankruptcy marks a shift in state trajectory, environmentalists said. Venoco, which has its headquarters in Colorado, said it filed for Chapter 11 bankruptcy and would dispose of its assets as a result. The company will quit-claim its lease for the offshore South Ellwood field back to the state and now starts the decommissioning of its offshore Holly platform and associated infrastructure onshore. Venoco Chief Operating Officer Mike Wracher said there was a steady string of circumstances that led to the financial constraints that necessitated bankruptcy, including the ongoing closure of Line 901 in California. “We have pursued a number of market-based and regulatory solutions to address these challenges during the last […]

Why The Permian Doesn’t Keep OPEC Awake At Night

19 Apr 2017   Shale Oil, USA

The old saying goes, “Everything’s bigger in Texas”. The latest subject of this axiom is the legendary Permian Basin. The recent headlines have been eye-popping. “The Permian Basin Keeps On Giving”. “A $900 Billion Oil Treasure Lies Beneath West Texas Desert”. “Shell’s New Permian Play Profitable at $20 A Barrel”. “The World’s Hottest Oil Play”. “Permian Basin Prevails”. “The Permian Basin: An existential Threat To Canadian Oil As The War On Cost Heats Up”. “This Texas Oilfield Is Messing With OPEC”. The articles contain analysis and commentary concluding that no matter what happens in the rest of the world, the future of oil prices will be heavily influenced by U.S. light tight oil (LTO) producers and more specifically, the Permian. This is more of the popular thesis OPEC is dying or dead and the United States has replaced Saudi Arabia as the world’s swing producer. Except it is not […]

Pipeline Built to Survive Extremes Can’t Bear Slow Oil Flow

15 Apr 2017   Arctic, USA

Trans Alaska carrying just a quarter of its peak volume The lower the flow, the higher the risks from Arctic cold Here at the top of the world, January brought a glimpse of the anxious future facing Alaska’s once-mighty oil pipeline. The 800-mile Trans Alaska Pipeline System was built for extreme conditions. But as the state’s oil production declines, the pipeline faces a new challenge: flows so sluggish operators worry the line may become unusable, cutting off access for hundreds of North Slope oil wells. With the mercury dipping as low as -60 Fahrenheit, workers in January fired up heating units across the system. It worked, but if the brutal cold had lasted or the oil flow had slowed further, the pipeline would have been in uncharted territory. Four decades after it opened, Alaska’s pipeline — once a symbol of independence for an oil-strapped nation — is facing a […]

Gas at $3 per gallon could hurt U.S. economy

14 Apr 2017   USA

The U.S. national average price for a gallon of gasoline would need to move close to $3 before it starts having a negative economic impact, an analyst said. U.S. retail gasoline prices have been on a steady increase for the better part of the year. Motor club AAA reports a national average price for a gallon of regular unleaded at $2.40 early Thursday, an increase of 15 percent, or 32 cents per gallon higher than this date last year. Over the course of a year, that difference could eat into savings or discretionary spending. Gasoline prices are tied to crude oil prices and the health of the nation’s refinery infrastructure. Crude oil prices are up almost […]

U.S. Oil Rig Count Hits 2 Year High

14 Apr 2017   USA

This week’s Baker Hughes rig count has oil rigs up by 11, with a majority of the growth occurring in the Permian Basin in Texas and New Mexico. The number of active oil rigs in the United States now stands at 683 – 332 rigs higher than the figure one year ago. The last time oil rigs were this high in number was in April 2015. Gas rigs declined this week by 3—after five consecutive weeks of growth—bringing the total oil and gas rig count to 847, or 407 more than a year ago today. This week marks the thirteenth straight week of increases to the oil and gas rig count. Both benchmarks were trading down on the day an hour after data release, with WTI trading down 14 cents at $52.97, and Brent trading down 23 cents at $55.63. State-wise, New Mexican drilling activity grew by seven rigs, […]

Dakota Access Pipeline to start interstate service May 14

14 Apr 2017   Pipelines, USA

The controversial Dakota Access Pipeline will begin interstate crude oil delivery on May 14, according to a filing with the U.S. Federal Energy Regulatory Commission. Energy Transfer Partners LP on Thursday filed what is known as a tariff, which lays out details about the line and the oil to be delivered. The 1,172-mile (1,885-km) Dakota Access line runs from western North Dakota to Patoka, Illinois. The $3.8 billion project became a focus of international attention, drawing protesters from around the world, after a Native American tribe sued to block completion of the final link of the pipeline through a remote part of North Dakota. The Standing Rock Sioux tribe said the pipeline […]

U.S. Oil-Rig Count Climbs by 11

14 Apr 2017   Shale Oil, USA

The number of rigs drilling for oil in the U.S. rose by 11 in the past week to 683, according to oil-field services company Baker Hughes Inc. The Baker Hughes report was delivered a day early because U.S. financial markets will be closed in observance of Good Friday. The U.S. oil-rig count is typically viewed as a proxy for activity in…

U.S. offshore oil production on the rise

14 Apr 2017   Offshore, USA

With two oil fields in the Gulf of Mexico starting production this year, and five on tap for 2018, offshore production is set to increase, a U.S. report found. Eight new fields in the U.S. waters of the Gulf of Mexico started producing oil last year, leading to a high-water mark of 1.6 million barrels per day, beating the previous record set in 2009 by 44,000 bpd. By January, regional offshore production was up another half million barrels on a daily basis. A March report from analytical group Wood Mackenzie found the cost to break even on oil and gas projects in deep waters, the U.S. Gulf of Mexico in particular, has dropped from around $70 […]

U.S. crude stockpiles fall unexpectedly: EIA

13 Apr 2017   USA

U.S. crude stocks fell unexpectedly last week, the Energy Information Administration said on Wednesday, while gasoline and distillate inventories also declined in a report that analysts said should be supportive for prices. Crude inventories fell by 2.2 million barrels in the week to April 7, compared with analysts’ expectations for an increase of 87,000 barrels. “A near 2.2 million barrel draw to commercial crude stocks and continued draws to product stocks should provide support to current prices,” said Troy Vincent, oil analyst at ClipperData. Oil prices bounced around following the release. Traders attributed the up-and-down action to the drawdown in inventories against another increase in U.S. production, higher inventories at the Cushing, Oklahoma, oil hub, and traders exiting profitable trades after the last two weeks of price gains. U.S. crude was down 9 cents to $53.31 a barrel as of 11:21 a.m. ET, while Brent crude dropped 17 cents […]

Summary of Weekly Petroleum Data for the Week Ending April 7, 2017

13 Apr 2017   Oil Supply, USA

U.S. crude oil refinery inputs averaged 16.7 million barrels per day during the week ending April 7, 2017, 268,000 barrels per day more than the previous week’s average. Refineries operated at 91.0% of their operable capacity last week. Gasoline production increased last week, averaging over 9.9 million barrels per day. Distillate fuel production increased last week, averaging about 5.1 million barrels per day. U.S. crude oil imports averaged 7.9 million barrels per day last week, up by 28,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 8.1 million barrels per day, 3.0% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 488,000 barrels per day. Distillate fuel imports averaged 118,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) […]

Gulf of Mexico crude oil production, already at annual high, expected to keep increasing

13 Apr 2017   Offshore, Oil Supply, USA

U.S. crude oil production in the Federal Gulf of Mexico (GOM) set an annual high of 1.6 million barrels per day (b/d) in 2016, surpassing the previous high set in 2009 by 44,000 b/d. In January 2017, GOM crude oil production increased for the fourth consecutive month, reaching 1.7 million b/d. On an annual basis, oil production in the GOM is expected to continue increasing through 2018, based on forecasts in EIA’s latest Short-Term Energy Outlook (STEO). In 2016, eight projects came online in the GOM, contributing to the high production levels. Another seven projects are anticipated to come online by the end of 2018. Based on anticipated production levels at these new fields and existing fields, annual crude oil production in the GOM is expected to increase to an average of 1.7 million b/d in 2017 and 1.9 […]

Florida lawmaker fending off calls for oil and gas drilling

13 Apr 2017   Offshore, USA

Amid calls for more oil and gas drilling, a Democratic senator in Florida said he was “beating back” pressure for exploration in the Gulf of Mexico. Industry groups like the American Petroleum Institute have praised executive orders from President Donald Trump that favor the oil and gas industry. With changes in Washington, Kevin Doyle, the Florida director of the Consumer Energy Alliance, said in a message sent to UPI that he called on state leaders to evaluate the potential for oil and gas exploration in the waters off the western coast of Florida. By Doyle’s estimates, state coffers could be bolstered for the benefit of Florida residents struggling with medical bills and dwindling pensions. “A strong and growing constituency in Florida supports […]

U.S. Oil Production, Imports Rise Faster Than Expected

13 Apr 2017   Oil Supply, USA

The EIA’s short-term energy outlook , released on April 11, predicted increases in American energy production, along with an increase in imports. The agency’s forward predictions on the outlook of U.S. oil and gas production are mostly bullish, despite earlier reports that total energy production in the U.S. had fallen by 4 percent , a change driven largely by declining demand for coal and low oil and gas prices. However, while the agency expects natural gas prices to climb, there are only moderate expectations for future increases in the price of oil, a sign that the EIA doesn’t expect demand to seriously outstrip supply in the short-term. The EIA report estimated the average U.S. oil production in 2016 to have been 8.9 million bpd. Looking ahead, the EIA estimates the average for 2017 to hover around 9.2 million bpd and 9.9 million the following year, an increase of 11 […]

Gas prices up on geopolitical tensions, end of winter

12 Apr 2017   USA

A steady rise in crude oil prices and maintenance at the nation’s refineries means steady pain at the pump for U.S. motorists, motor club AAA reports. AAA lists a national average price for a gallon of regular unleaded gasoline at $2.39, up slightly from Monday for nearly a two-week streak of gains. By the motor club’s estimates, the national average for the price of gas is up more than 4 percent, or about 10 cents per gallon, from one month ago. “Pump prices in 48 states and Washington D.C. have moved higher over the last week, led by the switch over to more expensive summer-blend gasoline and increased driving demand,” AAA explained in a weekly retail market report . […]

Texas New Drilling Permits Shoot Up Threefold in March

12 Apr 2017   Oil Supply, USA

The Texas Railroad Commission issued 1,310 new oil and gas drilling permits to shale producers last month, up from just 511 a year ago. Most of these were issued for the Permian, cementing further its top spot among most desirable drilling destinations in the shale patch. However, as Reuters notes , the increase in permits went hand in hand with a decline in well completions: oil well completions were down 44 percent in March on an annual basis, to 533 wells, and gas well completions were down 60 percent to 77. Texas currently sports the most active drilling rigs in the U.S., at 418 or half of the total, according to Baker Hughes data. One industry insider from Texas told Reuters that the decline in well completions is no cause for alarm. Ed Longanecker, president of the Texas Independent Producers and Royalty Owners Association, said that producers will amass […]

EIA STEO projects higher US crude production, increases in travel and gasoline demand

12 Apr 2017   Oil Supply, USA

Outlook (STEO), the US Energy Information Administration (EIA) projects that US crude oil production, which averaged an estimated 8.9 million barrels per day (b/d) in 2016, will average 9.2 million b/d in 2017 and 9.9 million b/d in 2018. That level is higher than originally forecast, exceeding the previous record level of 9.6 million barrels per day reached in 1970, said EIA Acting Administrator Howard Gruenspecht. For summer 2017, EIA forecasts motor gasoline consumption to average 9.5 million barrels per day (b/d), up about 20,000 b/d (0.3%) compared with last summer, which was a record high. Highway travel is forecast to be 1.4% higher than the level last summer. The effect of the increase in highway travel is expected to be partially offset by a 1.2% increase in […]

As Texas oil output surges, cash crude discounts near two-year lows

12 Apr 2017   USA

Surging West Texas oil production has pushed the value of the region’s spot crude to its lowest discount to the U.S. oil benchmark in nearly two years, as an exuberant shale industry pumps more to take advantage of higher prices and demand from refiners who have seen supplies cut by top global producers. OPEC and non-OPEC suppliers are working toward cuts of 1.8 million barrels per day, around 2 percent of the 92 million bpd global market, as they try to bring down record oil inventories and raise prices. But supply cuts by exporters worldwide have given an incentive and opportunity to U.S. shale producers to do the opposite. They have sent rigs back into the field and are working to boost output after more than a two-year industry recession. The Permian Basin is the biggest […]