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The IEA Is Grossly Overestimating Shale Growth


This week, the IEA said that U.S. shale would dominate the oil and gas markets over the next decade, rising to “a level 50 percent higher than any other country has ever managed.” With a “remarkable ability to unlock new resources cost-effectively,” U.S. shale will add millions of barrels of new oil supply by 2025. […]

Can Russia Break Its Oil Dependence?


Despite improving oil prices, Russia’s economic growth is slowing, with GDP rise for the third quarter at 1.8 percent on an annual basis, versus 2.5 percent for the second quarter, Russia’s state statistical bureau, Rosstat, said earlier this week. Analysts say it’s the latest indication that Russia’s economy needs major reforms. Let’s state the obvious: […]

OPEC October Production Data

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All data below is based on the latest OPEC Monthly Oil Market Report. All data is through October 2017 and is in thousand barrels per day. I have now included Equatorial Guneia although I only have data from January 2015 from OPEC’s secondary sources. The January 2015 E. Guneia data was extended back to January 2005. I […]

Dan Yergin on why Venezuela could cause a ‘big shock’ to the markets

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If the global oil market suddenly loses Venezuela’s 2 million barrels of daily oil production, it would be “a big shock to the system,” according to Dan Yergin, vice chairman of IHS Markit. “It would certainly be a very tight market, because of course you already have production restraints by OPEC and non-OPEC,” Yergin told […]

America’s oil and gas output could soar 25% by 2025


At the same time, the renewable energy sources will become more important. Despite the cautious sentiment, traders said oil prices were unlikely to fall far, largely due to supply restrictions led by the Organization of the Petroleum Exporting Countries and Russian Federation, which have helped reduce excess stockpiles. Solar power will surge globally in the […]

Tracking the declines in ISIS oil production

Tracking the declines in ISIS oil production thumbnail

Oil has been a key revenue source for ISIS, yet new data shows that production has steadily declined in areas under the group’s control. Historically, it has been difficult to get an accurate measure of ISIS’s oil production. Past estimates extrapolated from chance observations at a small number of production sites — typically wherever journalists […]

What the Saudi Arrests Mean for the Kingdom’s Oil Policy


We may never fully know what lies behind Crown Prince Mohammed bin Salman’s decision to arrest more than 200 Saudi citizens, including 11 princes and four government ministers, on corruption charges, just as tensions with Iran are escalating. What we do know is that his move simultaneously boosted the oil price and undermined the attractiveness of Aramco to […]

Is Peak Permian Only 3 Years Away?

Is Peak Permian Only 3 Years Away? thumbnail

The world’s hottest shale basin, the Permian, is leading the second U.S. wave of tight oil production growth and will continue to do so for years to come, all analysts say.    However, signs have started to emerge that the relentless intensification of drilling leads to diminishing returns, Simon Flowers, Chairman and Chief Analyst at […]

Global Majors Eyeing Mexico’s Deep Waters


As the price of oil rises, an international rush is on for Mexico’s untapped deep-water riches. The who’s who of the oil world — led by Exxon Mobil Corp and Royal Dutch Shell Plc, the world’s two biggest drillers by market value — are lining up to bid in the country’s Jan. 31 deep-water auction. And […]

What happens when the drilling is done?


A seismic shift It seems like we’ve been talking about “peak oil” for a long time, but the meaning has shifted radically in the last few years. Historically the phrase referred to the hypothetical point in time when the world’s oil production would hit its maximum. It became famous in the 1970s, when we feared […]

Are Oil Markets Immune To US Shale?


Oil prices pulled back slightly following the release of the Baker Hughes rig count report, but geopolitical risk still remains, and with the assumption that OPEC will extend its production cut deal, oil bulls are very much alive and well. (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) […]

Norway’s Oil Sector Faces Existential Crisis


Exploration activity in the North Sea – the most mature area of Western Europe’s biggest oil producer – is at an 11-year low this year, which is a concern for the industry’s regulator, the Norwegian Petroleum Directorate (NPD). “That worries me,” NPD Director General Bente Nyland told Bloomberg in a recent interview, voicing the industry […]

The US Over-Supply Of Oil Is Ending

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Shutterstock The U.S. over-supply of oil is ending. Comparative inventory (C.I.) has been dramatically reduced in 2017. Levels have fallen 159 mmb since February and are now approaching the 5-year average for the first time in nearly 3 years (Figure 1). Figure 1. The U.S. Over-Supply of Oil is Ending. Source: EIA and Labyrinth Consulting […]

Russia Oil Market Overview

Russia Oil Market Overview thumbnail

Russia is the world’s largest producer of crude oil (including lease condensate) and the second-largest producer of dry natural gas. Russia also produces significant amounts of coal. Russia’s economy is highly dependent on its hydrocarbons, and oil and natural gas revenues account for more than one-third of the federal budget revenues. Russia is a major […]

Will The Third Great Energy Revolution End The Oil & Gas Industry?

Will The Third Great Energy Revolution End The Oil & Gas Industry? thumbnail

The history of crude oil and natural gas is a history of technological innovation. Until recently the innovation supported crude oil and natural gas. Now, it challenges it, causing structural changes in the crude oil and natural gas markets. Originally, crude oil was only used for lighting. This changed following the invention of the internal […]

‘Transformation Is Happening’: Saudi Aramco’s Chief on Future of Oil

‘Transformation Is Happening’: Saudi Aramco’s Chief on Future of Oil thumbnail

As Saudi Aramco, the Saudi national oil company, prepares for a widely-awaited initial public offering next year, its chief executive, Amin H. Nasser, is at the center of the planning. Mr. Nasser has run Aramco, which produces more oil than any other company in the world, since 2015, and also oversees a wide range of […]

US oil floated on cheap money


How much has the US oil industry been inflated, crushed and generally distorted by the Federal Reserve’s monetary force-feeding over the past nine years? According to my probing along the stages of production and trading, the answer is “a lot”. Yes, there have been dramatic developments in hydrocarbon production technology, but those looked even better […]

World Crude Oil Supplies per July 2017


In this post I present developments in world crude oil (including condensates) supplies since January 2007 and per July 2017. In this post the world crude oil (inclusive condensates) supplies is split into three entities, North America [Canada, Mexico and the US], OPEC(13) and other Non OPEC [World – {North America + OPEC(13)}] with a […]

From Russia With Love: A Super-Chilled Prize for China


CNPC will be first recipient of Arctic project’s fuel Chinese investment helped defray impact of U.S. sanctions The ‘Christophe de Margerie’ Arctic LNG tanker. Photographer: Olga Maltseva/AFP via Getty Images Russia’s Yamal LNG, set to be the world’s biggest Arctic producer of liquefied natural gas, plans to send its debut cargo to China as thanks […]

More than half of Alaska’s oil reserve is up for bids


The U.S. Bureau of Land Management will be accepting oil exploration bids for more than half of the land on a Northern Alaska petroleum reserve that’s the size of Indiana. The bureau’s announcement on Wednesday is the largest lease sale to be offered in the National Petroleum Reserve-Alaska, according to Alaska’s Energy Desk. A total […]

If Mexico Goes MIA, Permian Gas Could Flame Out


Natural gas spot prices fell to below $3.00 per million British thermal units on Tuesday. United States Natural Gas (ticker: UNG) notched a 0.31% decline so far. The Energy Information Administration is expected to release supply and demand data later this week, which tends to move gas prices on the day, but natural gas and natural gas stock […]

Norway Unfazed By Peak Oil Concerns


When crude oil demand will peak is anyone’s guess. Forecasts vary widely. Wood Mackenzie says that peak demand is “very real,” and sees a decline of 4 million bpd between 2020 and 2035. Other majors including BP and Total SA see peak demand as coming between 2025 and 2040, as a result of clean energy government initiatives, slower economic […]

The ‘sweet spots’ fueling the US shale oil boom ‘will not last forever,’ Saudi Aramco CEO says

The ‘sweet spots’ fueling the US shale oil boom ‘will not last forever,’ Saudi Aramco CEO says thumbnail

Saudi Aramco’s CEO says he does not worry about the booming U.S. shale oil output. The “sweet spots” that American frackers are focusing on will eventually deplete, forcing them to tap less lucrative acreage, Amin Nasser says. Saudi Aramco’s Amin Nasser, CEO of the world’s largest oil company, says he does not spend much time […]

Draining the storage glut

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A shift in most oil markets from contango to backwardation is changing the outlook for the global storage business World oil inventories are falling, and the two-year bonanza that handsomely rewarded oil-storage owners may well have run its course. After building through 2014 and 2016, commercial oil inventories in rich countries ended 2016 unchanged from […]

Oil: This Time It’s Different

Oil: This Time It’s Different thumbnail

Summary In this piece, I decided to tackle some recent oil-related data that shows a continued recovery in the market. Prices aren’t responding, but the underlying data suggests the recovery in the market now is real. I anticipate further improvements moving forward that will prove bullish for oil investors. Another week, another set of mostly […]

Oil Quality Issues Could Bankrupt Venezuela


The next few weeks for Venezuela will be crucial, as it could struggle to meet a huge stack of debt payments. Reports that the nation’s oil production is experiencing deteriorating quality raises a new cause for concern for the crumbling South American nation. Venezuela’s state-owned oil company PDVSA is reportedly shipping crude oil with growing […]

Texas’ shale oil boom yields rags-to-riches tales by the barrel


In the dusty heart of West Texas, rows of tall white wind turbines and rust-colored working pump jacks bob up and down along the vast rugged landscape. It’s a visual juggernaut but make no mistake – this is shale country and in this part of the Lone Star State, legends are born and billions are […]

Oil’s Biggest Rigs Head to the Junkyard


Transocean Ltd. is finally sending Pathfinder to its grave, after two years in a Caribbean purgatory that cost about $15,000 a day. The move by the world’s biggest offshore-rig operator signals just how bleak the future looks for deepwater drilling. Pathfinder is the most famous of six floating rigs the company is scrapping in burials […]

Oil Prices Buoyed by Middle East Tensions


Oil prices traded higher Wednesday, supported by ongoing political tensions in the Middle East. Brent crude, the global benchmark, was up 0.76%, at $58.32 a barrel on London’s Intercontinental Exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 0.31%, at $52.04 a barrel. “There are no prizes for guessing the […]

Recent Production: Colombia, Mexico and Brazil


Colombia Colombia production is holding a plateau over the past year after a large decline in the last part of 2015 and first half of 2016. August value was 858 kbpd (down 0.04% y-o-y). Colombia oil reserves at the end of 2016 were 1.66 Gb (down 16.8% from 2 Gb in 2015 which followed a […]

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