Cog wrote:Sooner than when?
Tanada wrote:If you look at the graph of Saudi Arabia their exports have been kept on a plateau for nearly 30 years, which is IMO an extremely impressive achievement. But if you look at the internal consumption part of the graph it is crystal clear that plateau exports and increase internal demand equals increased production. How long can KSA realistically grow its production to meet both plateau exports and ever growing internal demand? When they hit the production wall be it today or in two decades the result will be a decrease in exports.
Alfred Tennyson wrote:We are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
ROCKMAN wrote:The costs of developing Johan Castberg have been reduced…meaning that production could be profitable at an oil price of $31 a barrel rather than over $80 a barrel. Sweden's Lundin and Austria's OMV are looking at the possibility of developing the Alta/Gohta and Wisting discoveries in the Barents Sea.
America is now the world's largest oil producerFor the first time since 1973, the United States is the world's largest producer of crude oil. The feat demonstrates how the US shale oil boom has reshaped the global energy landscape. American oil output has more than doubled over the past decade.
Texas is the epicenter of the shale boom. Production in the Permian Basin of West Texas has grown so much that in February the United States vaulted above Saudi Arabia for the first time in more than two decades. US output kept climbing in June and August, reaching nearly 11 million barrels per day. That nudged the United States ahead of Russia for the first time since February 1999.
'Changed the game'
The achievement underscores the profound impact of rapid technological advances in drilling. Fracking unlocked vast sums of oil and natural gas that had been trapped underground. Drilling costs declined dramatically. "That changed the game for the US. It meant we could be resilient and competitive"
That resilience was required after oil prices crashed beginning in late 2014. OPEC launched a price war to regain market share lost to the United States and other oil producers. Falling prices knocked dozens of US oil companies out of business and caused widespread job losses. US oil production declined -- but not as dramatically as feared. And when prices began to rebound in 2016, US shale companies were able to quickly ramp up output. Their expenses were lower -- and technology had improved.
Texas is an oil superpower
Major oil producers including BP (BP) and ExxonMobil (XOM) have shelled out billions of dollars in recent years to get a piece of the action in the Permian Basin. The Lone Star state is on track to produce more oil than either Iran or Iraq. That would make Texas No. 3 in the world if it were a country. And the state's biggest port district recently exported more crude oil than it imported. "It's all about technological improvements, supported by ample capital to invest, and the ingenuity of American oil drillers."
Unlocking the Earth - A Short History of Hydraulic FracturingShale rock presented a particular challenge because of the difficulty in accessing the hydrocarbons in these tight formations. In the mid-1970s, the US Department of Energy (DOE) and the Gas Research Institute (GRI), in partnership with private operators, began developing techniques to produce natural gas from shale. These included the use of horizontal wells, multi-stage fracturing, and ‘slick’ water fracturing (GEO ExPro Vol. 9, No. 2).
UNCONVENTIONAL OIL AND NATURAL GASThe increase in shale oil and gas production in the United States follows many years of investment and research carried out by the federal government. Between 1978 and 1992, DOE invested about $137 million in the Eastern Gas Shale Program, which helped demonstrate and commercialize many of the technologies in use today. As early as 1975, a DOE-industry joint venture drilled the first Appalachian Basin directional wells to tap shale gas. From the 1970s to the 1990s, several DOE-funded R&D technologies would optimize production of shale across the United States: directional drilling, microseismic monitoring of multi-stage hydraulic fracturing treatments, and modeling. These investments—combined with industry collaboration—made the American shale revolution possible.
Big Oil Is About to Bury Skeptical Investors in Cash PileWith oil above $80 a barrel as costs remain at an eight-year low, the industry is seeing green. In 2018 alone, it will rake in as much extra money as it did in the previous five years combined. You could liquidate Facebook Inc. and it wouldn’t touch what oil companies will generate in free-flowing cash over the next three years.
Free cash flow at international oil companies is expected to more than double this year, to a record $175 billion. Then it will rise again in 2019, to close to $200 billion, and stay around that level for at least two years after that. The estimate comes with a big caveat. Oil prices can’t fall from today’s level of more than $80 a barrel, and companies can’t return to pre-crash spending heights. There are reasons to doubt the sustainability of crude’s rally. Oil prices have surged in the past year, in part because a snap-back of U.S. sanctions on Iranian exports is driving fears of supply shortages. BP Plc Chief Executive Officer Bob Dudley said those concerns could subside by the end of the year and that prices “feel high.”
Investors are also uncertain whether they can trust oil company executives to exercise restraint as crude keeps soaring. Firms committed to increasingly large projects, buoyed by a bullish crude market from 2008. By 2014, when prices collapsed, costs and investments for international oil companies rose to $560 billion, while free cash flow fell to less than $50 billion, not enough to cover dividend payments. While the same companies cleaned up their balance sheets and are now more profitable than before the price crash, investor confidence in the sector hasn’t been fully restored.
New review shows oil and gas debt at lowest levels since late 2014A new review by the Department of Energy shows that debt levels in the energy industry are at their lowest levels since the third quarter of 2014.
The financial review of the global oil and gas industry for the second quarter of 2018 ending June 30 found that companies had reduced their debt for seven consecutive quarters, leading to the lowest long-term debt-to-equity ration since the third quarter of 2014, which was right before oil prices began to plummet.
Debt was reduced by more than $20 billion in the second quarter. The report said Brent crude oil prices, the global benchmark, were 48 percent higher in second quarter 2018 than a year ago, averaging $75 a barrel, and the highest since the fourth quarter of 2014.
PM warns of high oil prices hurting global economic growth[India's] Prime Minister Narendra Modi today warned oil producers like Saudi Arabia that high crude prices are hurting the global economy and sought a review of payment terms to provide a temporary relief to the local currency.
India, the world's third-biggest oil consumer, has been over the past two months battered by high crude oil prices that have sent retail petrol, diesel and LPG rates to record high, posed inflationary risks and together with a sliding rupee threatened to upset its current account deficit. Also, unrelenting fuel price rise since mid-August has negated cut in taxes and subsidy.
The Indian rupee has fallen 14.5 per cent this year, making imports costlier. The country is over 83 per cent dependent on imports to meet its oil needs. Oil Minister Dharmendra Pradhan said India is "facing severe headwinds from rising oil prices" which have risen by 50 per cent in dollar terms and 70 per cent in rupee term in the last one year.
kublikhan wrote:Some oil importers like India are squealing under the higher oil prices. The oil companies on the other hand have seem to have hit a sweet spot. They spent years cutting costs and tightening their belts driving costs to an eight year low. Meanwhile oil is selling at a four year high. Low costs + high revenues = lots of cash. In 2018 they will generate more free cash flow than the previous five years combined.
pstarr wrote:The all-time greatest moment of oil production quantity occurs just before peak. That occurred yesterday.
Tomorrow is the decline.
pstarr wrote:The all-time greatest moment of oil production quantity occurs just before peak. That occurred yesterday.
Tomorrow is the decline.
pstarr wrote:Did I miss anything??
pstarr wrote:. . . this is peak now. Wanna bet?
ROCKMAN wrote:". . . this is peak now. Wanna bet?". A foolish wager IMHO. Unless you're willing to wait decades before finding out if it's correct. Global PO can only be confirmed with any degree of confidence by looking in the rear view mirror. A very long term rear view mirror.
Alfred Tennyson wrote:We are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
pstarr wrote:Oil is not just another commodity. Supply and price at the margins can have a profound effects on fragile industrial and economic sectors. See Taintner's Diminishing Returns of Complexity.
The Greatest Recession never ended, it was merely glossed over by untenable debt that will never be paid. Few countries do not now struggle with some sort of severe economic disruption or crisis.
There will no longer be rear view mirrors in "a few decades." Certainly not attached to the mirror post on a late model car. Perhaps hanging from the bed post in the boudoir of some tribal hotties hut lol
The world economy has NEVER been in better shape.
asg70 wrote:pstarr wrote:. . . this is peak now. Wanna bet?
Thanks. My sig now has something to stick in there.
pstarr wrote:You do realize that maximum production occurs right before the peak?
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