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Oil! Massive shale discovery in Texas

By on 8 Sep 2016 in news, notable posts with 0 Comments
Oil! Massive shale discovery in Texas

(CNN) Apache ( APA ) revealed the huge find this week after more than two years of stealthily buying up land, extensive geological research and rigorous testing.

The Houston company estimates the discovery, dubbed “Alpine High,” could be worth at least $8 billion.

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OPEC Monthly Oil Market Report August 2016

By on 22 Aug 2016 in news, notable posts with 0 Comments
OPEC Monthly Oil Market Report August 2016

(peakoilbarrel.com) When oil fell below $30 a barrel earlier this year, banks turned away from lending to energy companies. The price of crude has bounced back more than 80% from its February low, but banks are still wary.

Big banks cut loans to the energy sector by about 3% in the second quarter over all and some individual lenders pulled back much more, according to an analysis of July and August securities filings by Barclays analysts.

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Oil prices slip as short-covering rally fizzles

By on 8 Aug 2016 in news, notable posts with 0 Comments
Oil prices slip as short-covering rally fizzles

(Reuters) A worker walks at Nahr Bin Umar oil field, north of Basra, Iraq December 21, 2015. Oil prices dipped on Friday, ending a two-day rally, as a glut of crude and refined products weighed on markets and investors eyed a possible stutter in China’s imports.

U.S. West Texas Intermediate (WTI) crude futures CLc1 fetched $41.74 per barrel at 0930 GMT (0530 ET), down 19 cents from their last close, after trading as low as $41.44 earlier in the day. They were on track roughly to break even on the week.

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Analysis

Oil glut seen extending into 2017 on weaker demand

By on 13 Sep 2016 in analysis, notable posts with 0 Comments
Oil glut seen extending into 2017 on weaker demand

(Toronto Star) The much-anticipated rebalancing of oil markets appears to be a bit further away after the International Energy Agency revised its forecast, trimming its expectations for the growth in oil demand and citing near-record production by OPEC’s Middle East exporters.

The IEA said Tuesday that global oil demand is rising at a slower pace than expected, lowering its forecast by 100,000 barrels a day to an increase of 1.3 million barrels a day in 2016 and 1.2 million barrels a day in 2017.

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Are Shale-Oil Companies Starting to Weather the Crude Slide?

By on 5 Aug 2016 in analysis, notable posts with 0 Comments
Are Shale-Oil Companies Starting to Weather the Crude Slide?

(Wall Street Journal) A truck used to carry sand for fracking is washed in a truck stop on February 4, 2015 in Odessa, Texas. … Debt from U.S. shale companies has held its ground even as oil prices have beat a fast retreat, a sign the firms may have adapted to an era of cheaper crude and could remain key suppliers to the market.

A build-up in stockpiles of oil has renewed downward pressure on prices: U.S. crude is now at roughly $42 the barrel, 14% below where it was at the beginning of June, when it appeared to be rallying.

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The One Chart That Shows Why Oil Prices Have To Keep Rising

By on 28 Jun 2016 in analysis, notable posts with 0 Comments
The One Chart That Shows Why Oil Prices Have To Keep Rising

(oilprice.com) There has been a lot of pessimism among oil investors in recent months, and indeed the bear market over the last couple of years in black gold has destroyed many nest eggs. With that said, oil investors who have run for the hills could find themselves regretting that decision in the months and years to come.

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Viewpoints

What Hubbert Got Really Wrong About Oil

By on 8 Sep 2016 in notable posts, viewpoints with 0 Comments
What Hubbert Got Really Wrong About Oil

(Forbes) If you happen to be someone who is interested in the topic of “peak oil”, you know the name M. King Hubbert.

The history of the scientific study of peak oil dates to the 1950s, when Hubbert, a Shell geophysicist, reported on studies he had undertaken regarding the production rates of oil and gas fields.

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Is the Oil Industry Dying?

By on 10 Aug 2016 in notable posts, viewpoints with 1 Comment
Is the Oil Industry Dying?

(psmag.com) Talking about “peak oil” can feel very last decade. In fact, the question is still current. Petroleum markets are so glutted and prices are so low that most industry commenters think any worry about future oil supplies is pointless. The glut and price dip, however, are hardly indications of a healthy industry; instead, they are symptoms of an increasing inability to match production cost, supply, and demand in a way that’s profitable for producers but affordable for society. Is this what peak oil looks like?

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The Death of OPEC

By on 26 Jul 2016 in notable posts, viewpoints with 0 Comments
The Death of OPEC

(Project Syndicate) The Organization of the Petroleum Exporting Countries is dead. Saudi Arabia killed it. Now, OPEC is just a toothless zombie, attracting attention, but without having any impact on the living.

Few have noticed OPEC’s demise for a simple reason: it never really had the impact that it was widely perceived to have. It was never actually a cartel, possessing monopolistic market power. Anyone who thought otherwise was mistakenly attributing to it Saudi Arabia’s market power.

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Other Recent Posts

Carbon Tracker Initiative on solar energy vs. fossil fuel energy market share dynamics

By on 13 Feb 2017 in quotes with 0 Comments

“Fossil fuels may lose 10 percent of market share to PV and EVs within a single decade. This may not sound much but it can be the beginning of the end once demand starts to decline.”

Carbon Tracker Initiative

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Peak Oil Review – 13 Feb 2017

By on 13 Feb 2017 in Peak Oil Review with 0 Comments
Peak Oil Review – 13 Feb 2017

Oil prices rebounded last week as the IEA confirmed that the ten OPEC members obligated to cut oil production are making good progress and obtained 91 percent of their goal by the end of January. The agency also reported that OECD crude stocks fell by nearly 800,000 b/d in the 4th quarter of 2016 although stocks continued to grow in China and other emerging economies. If OPEC and the other production cutters can maintain this level of cuts for the next five months, the IEA says that global stockpiles should drop by about 600,000 b/d during the first half of this year. This was the kind of news that many oil speculators wanted to hear. Hedge fund bets on higher oil prices have surged in recent weeks as many markets participants say they are expecting higher oil prices later this year.

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Senior managing mirector at Evercore ISI on labor shortage of oilfield service companies

By on 6 Feb 2017 in quotes with 0 Comments

“Oilfield service companies have pressed fresh (green) blood into service amidst a vigorous ramp up in activity, and failure/HSE rates have already felt the negative impact. Not only is labor a bottleneck, it is shaping up to be the primary bottleneck in the early stages of the [North American] recovery…E&P’s will throw enough money at the North American labor problem to bring the sector back to equilibrium, sacrificing capital efficiency to hit production targets.”

James West, a senior managing director at Evercore ISI

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Peak Oil Review – 6 Feb 2017

By on 6 Feb 2017 in Peak Oil Review with 0 Comments
Peak Oil Review – 6 Feb 2017

With the advent of the Trump administration and Republican control of the Congress, the world oil situation seems likely to become more uncertain than usual. In the last two weeks, the new President has signed numerous executive orders that will have an impact on the oil industry in coming years. The President and the Republicans in Congress will soon have done everything they can to launch a new oil boom by reducing environmental and financial regulations; permitting whatever pipelines the oil industry wants to build; and opening federally-controlled property and offshore areas for drilling. Republicans have long held that America would be energy independent were it not for the restrictions unfairly placed on the industry. While these measures may eventually spur more drilling, for the time being, however, oil prices and the demand for oil will still determine investment decisions. Some are questioning whether the Keystone XL will be built in the near future given the relatively low oil prices and the shale oil boom that have become important since the pipeline was planned.

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John Kemp, Reuters energy columnist, on Trump administration’s pipeline approval policies

By on 30 Jan 2017 in quotes with 0 Comments

“The blunt reality for the Trump administration is that there is no way to make pipeline approvals conditional on the use of U.S. steel without undermining the goal of fair market access for U.S. exporters.”

John Kemp, Reuters energy columnist

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Peak Oil Review – 30 Jan 2017

By on 30 Jan 2017 in Peak Oil Review with 0 Comments
Peak Oil Review – 30 Jan 2017

Prices moved slightly higher last week as the markets continued to watch the decline in oil production by most OPEC members and a few other exporters interested in seeing oil move higher. The evidence continues to accumulate that progress is being made in achieving OPEC’s 1.8 million b/d cut. In addition to a number of OPEC luminaries who assured the world that the cuts are happening and that the markets would be balanced shortly, tanker-tracker Petro-Logistics said that its information indicates that OPEC will reduce its supply by 900,000 b/d in January. This number does not include 11 non-OPEC members that are also supposed to be cutting production 600,000 b/d. The CEO of Petro-Logistics which has been monitoring tanker movements for 30 years said this suggests “a high level of compliance thus far.”

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Paul Frankel, economist, on the nature of the petroleum industry

By on 23 Jan 2017 in quotes with 0 Comments

“The basic feature of the petroleum industry … that matters most is that it is not self-adjusting.” The industry has “an inherent tendency to extreme crises” and “hectic prosperity is followed all too swiftly by complete collapse.”

Paul Frankel, economist, “Essentials of Petroleum,” 1946 (from energy columnist John Kemp)

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Peak Oil Review – 23 Jan 2017

By on 23 Jan 2017 in Peak Oil Review with 0 Comments
Peak Oil Review – 23 Jan 2017

Three themes dominated the oil news last week. 1. Will OPEC with Russian help succeed in cutting production enough to rebalance the oil markets and move prices significantly higher? 2. Will the US oil industry rebound so vigorously as to offset the OPEC cuts? 3. And finally what will the be the impact of all the new energy policies the Trump administration is beginning to implement?

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President of American Petroleum Institute on the regulatory environment impacting the petroleum industry

By on 9 Jan 2017 in quotes with 0 Comments

“We must break from the recent past [and] re-examine the regulatory onslaught of the last few years that has proposed or imposed some 145 regulations and other executive actions on our industry, and instead work to implement smart energy regulations.”

Jack Gerard, President, American Petroleum Institute

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Peak Oil Review – 9 Jan 2017

By on 9 Jan 2017 in Peak Oil Review with 0 Comments

For the last month oil prices have been stuck in a trading range in New York of between $52 and $54 a barrel. In London, oil has been trading two or three dollars higher. After a 30 percent jump in the last six weeks of 2016 in response to the OPEC production freeze, prices have stabilized as the markets wait to see the degree of compliance with the pledged production cuts. It may take several months to establish a clear trend as so many nations are involved in the cut. While a few countries, particularly the US, publish oil production and inventory statistics weekly, others do a poor job of collecting statistics. A few release incorrect production numbers they know to be untrue for a variety of political reasons.

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