Jan Lars Mueller – Executive Director
Thomas Whipple – Editor, Peak Oil Review and Peak Oil News
"Corruption in Nigeria has virtually developed into a culture where honest people are abused. The amount of money [involved] is mind-boggling but we have started getting documents where some of the senior people in government and former ministers have as much as five accounts and were moving about one million barrels per day on their own. We have started getting those documents." Nigeria’s President Buhari ... Read More
“For a brief, brave moment this year there was a sense the worst was over for the oil sector. This week, that feeling evaporated.” Gregory Meyer, The Financial Times, July 17, 2015 ... Read More
“The Economist has examined the books of the 62 largest listed exploration and production firms in America whose collective output is mainly from shale. The results suggest many first are more vulnerable than the bullish noises from their bosses suggest. There are three sets of concerns: the juicing-up of the results announced for the first quarter of 2015; high leverage; and the industry’s returns on capital.” The Economist, July 4th issue ... Read More
“The initial [round of layoffs] was an absolute bloodbath to get rid of all the people who were not core, but if things don’t improve, they’re going to have to start cutting again. If the price of oil – or when the price of oil comes back—the question is whether we are going to have sufficient folks out there to meet the increased demand [for well completion services].” Bob Gray, a partner in the transactions practice at Mayer Brown LP ... Read More
"I am now more convinced than ever that 2015 will see the peak in world crude oil production. I have very closely studied the charts of every producing nation and my prognosis is based on that study. I see many nations in steep decline and most every other nation peaking now, or in the last couple of years, or very near their peak today. These include the world’s three largest producers, Russia, Saudi Arabia and the USA.”
--Ron Patterson, peakoilbarrel.com ... Read More
“New scientific models supported by the British government’s Foreign Office show that if we don’t change course, in less than three decades industrial civilization will essentially collapse due to catastrophic food shortages, triggered by a combination of climate change, water scarcity, energy crisis, and political instability.”
Nafeez Ahmed, investigative journalist ... Read More
"The debt that fueled the US shale boom now threatens to be its undoing. Drillers’ debt ballooned to $235 billion at the end of the first quarter, a 16 percent increase in the past year, even as revenue shrank. The problem for shale drillers is that they’ve consistently spent money faster than they’ve made it, even when oil was $100 a barrel. The companies in the Bloomberg index spent $4.15 for every dollar earned selling oil and gas in the first quarter, up from $2.25 a year earlier, while pushing U.S. oil production to the highest in more than 30 years.
“The question is, how long do they have that they can get away with this,” The companies with the lowest credit ratings “are in survival mode.”
Thomas Watters, oil and gas credit analyst at Standard & Poor’s in New York ... Read More
"We were on stage in a panel at an Oslo energy forum and we were pressed by people in the panel to talk about our views on climate and what our positions were...On stage, Ben [van Beurden, Shell CEO], Patrick [Pouyanne, Total CEO], Eldar [Saetre, Statoil CEO] and I said we should speak with a common voice - why don't we do that? It came about as simple as that."
--BP CEO Bob Dudley (Reuters, June 13)
CEOs of Eni and BG joined the initiative in the weeks that followed. The bosses of ExxonMobil and Chevron opted not to join the initiative, much to the ire of their European counterparts ... Read More
“This week, Georgetown University’s board voted to sell off its investments in coal, and Norway’s sovereign wealth fund, the largest pool of investment money in the world, announced it would do the same…Divestment won’t move Exxon Mobil directly — that’s impossible; the company is dug in, and someone else will simply buy the stock when it’s sold. But divestment will undercut the industry’s political power…Divestment is one tool to change the zeitgeist, so that the day arrives more quickly when the richest and most powerful can no longer mock renewable energy and play down climate change.”
--Bill McKibben, distinguished scholar at Middlebury College, founder of the group 350.org (in the Washington Post) ... Read More
“From Capitol Hill to the Motor City, marble statehouses to mud strewn shale plays, lawmakers, policy wonks and industry leaders repeatedly invoke U.S. government energy forecasts to call for more drilling, more fracking and more nuclear plants. These predictions are made by the Energy Information Administration. They are ostensibly apolitical, certified with a federal seal of approval and are ripe fodder for the journalists, analysts and government agencies responsible for painting a picture of the country's energy future. But in truth, some experts say, we'd have better luck calling Miss Cleo [than using EIA forecasts].”
--Alan Newhauser, US News & World Report [Note: Miss Cleo is an American psychic] ... Read More
In reviewing BP’s latest Statistic Review of World Energy, the big story for world oil last year was obvious: the USA’s third straight record-breaking increase in average annual production. Just over 75% of the net increase in world oil production during 2014 came from the USA; add in Canada and 90% of the total increase came from North America. Throw in Brazil’s first significant increase in three years and you have all the world’s net gain in world oil production accounted for by three non-OPEC players. Production from all other producers combined was flat. So the question for 2015 is straightforward: will we see a repeat of those gains…and the flat-liners?
By Art Berman. Reprinted from ArtBerman.com World oil demand increased by 1.1 million barrels per day in February. This is a potentially important data point that suggests a crude oil price recovery sooner than later. It is also important because it further supports the view that a production surplus and not weak demand is the main cause for the […]
By Robert L. Hirsch. The recent world oil supply/price decline situation looks very much like what happened in 1985-86, when the Saudis dramatically increased oil production, causing world oil prices to crater. That Saudi action was the result of their having acted as swing producer in OPEC, which under those circumstances caused a progressive loss […]
A National Energy Program – A White Paper on Achieving Energy Independence and National Transformation. By Lawrence Klaus. Revised and Updated, January 2015. In a recent post, we marked the 40th anniversary of the 1973 Oil Embargo–an event that has had profound economic and geopolitical aftershocks for the United States. The embargo itself lasted […]
The slide in oil prices continued with New York futures closing Friday at $48.14, down 6 percent for the week, and London futures closing at 54.42, down 4.3 percent during the week. This time the decline was aided by an increase of 21 rigs drilling for oil in the US suggesting that US shale oil production will increase or at least decline more slowly. The decision to reactivate these rigs was likely taken a month or more ago when prices seemed to be stabilized around $60 a barrel. In addition to the increase in rigs, the now normal factors of a stronger US dollar, a contracting Chinese economy, increasing inventories, and higher oil output from Saudi Arabia and Iraq contributed to the falling prices. The prospect that more Iranian oil will be coming on the the market before the end of the year also keeps pressure on the market.
While still volatile, oil prices continued to decline last week with New York futures closing at nearly a three-month low of $50.89 – down 3.5 percent for the week and 14 percent this month. In London oil futures followed a similar pattern with Brent also finishing at close to a three-month low of 57.10 – down 3.2 percent for the week and 10 percent this month. This was the third consecutive weekly loss for oil futures.
Last week US oil prices had their biggest weekly decline since March as concerns about over supply, the Greek debt crisis and China’s stockmarket plunge all came together to force prices down. Most of the decline came on Monday and Tuesday in the wake of the Greek Austerity referendum with New York futures trading below $51 a barrel, down $10 from where they had been in the previous week and London got close to $55 a barrel before a rebound set in. By Sunday night the Greeks reached a deal with the other Eurozone members over a bailout and Beijing “stabilized” its equity markets using draconian measures. New York futures closed out the week at $52.74 and London at $58.57.
The gradual down trend in oil prices which began in early May continues with New York futures closing the week at $55.52 and London at $60.32 – down about 13 percent from the spring highs. The Greek crisis; the Iranian nuclear negotiations; reports of near-record oil production by Russia and OPEC resulting in a circa 2 million b/d global surplus; the steep decline in the Chinese equity markets; and the announcement that the US drilling rig count increased last week after 29 consecutive declines all contributed to weak prices. At $55 a barrel, NY futures have now broken out of the $57-62 trading range that has obtained since early May.