Hedge funds have gone all-in on lower oil prices, counting on seasonal weakness to play out again this year. Money managers increased wagers on declining crude prices to a record as futures dropped to the lowest in more than three months. U.S. crude inventories climbed for a second week as imports arrived at the fastest pace since 2012. The supply gain comes on the cusp of seasonal refinery maintenance that will curb crude demand. Futures have declined in each of the past five Septembers.

Oil Bear Market Attracts Record Bets on Further Price Slide - Bloomberg

U.S. oil drillers added rigs for the sixth-straight week, marking the longest period of expansion in a year as the shale patch revives from the worst downturn in a generation. Rigs targeting crude in the U.S. rose by 7 to 381 in the past week, Baker Hughes Inc. said on its website Friday. Explorers have now added 51 rigs since June 24, expanding activity in nine of the past 10 weeks. The rise was prompted by a rebound in prices that peaked in June before falling off again.

Shale drillers add oil rigs for longest streak in a year

Two years on, you could excuse mining executives for feeling smug. As crude trades well below $50/bbl, Exxon Mobil Corp., Royal Dutch Shell Plc and other oil giants have seen their debt double to a combined $138 billion, spurring concerns they’ll need to keep slashing capital spending and that dividend cuts may eventually be necessary. Worse, the mountain of debt, which has grown tenfold since 2008, is likely to increase further in the third and fourth quarters, executives and analysts said.

Crude slump sees oil majors’ debt burden double to $138 billion

The U.S. electric power sector burned through a record amount of natural gas in recent weeks, a sign of the shifting power generation mix and also a signal that natural gas supplies could get tighter than many analysts had previously expected. The EIA reported a surprise drawdown in natural gas inventories for the week ending on August 3. The reduction of 6 billion cubic feet (Bcf) was the first summertime drawdown since 2006. Natural gas spot prices shot up following the data release on August 4, although they fell back again shortly after.

Surprise Natural Gas Drawdown Signals Higher Prices Ahead | OilPrice.com

According to CNPC, the state-owned oil and gas giant, natural gas imports could jump to as much as 270 billion cubic meters annually by 2030. To put this in perspective, gas imports in 2015 totaled 53 billion cubic meters, with total consumption that year reaching 200 billion cubic meters. The increase will come largely thanks to a general shift toward cleaner energy sources as China seeks to clean up its image as one of the biggest polluters in the world. The shift is also part of a government strategy to move away from heavy industry to services as a growth driver.

China Could Quadruple Gas Imports By 2030 | OilPrice.com

Estimates by Bloomberg have shown that oil majors have doubled their combined debts to US$138 billion since 2014. That’s also a staggering tenfold jump from the 2008 total oil major debts. Looking at the Q2 balance sheets of some oil majors, we see debts rising, cash flows dropping, capex diminishing, but dividends firmly held, and in Exxon’s (NYSE:XOM) case, even raised by 2.7 percent compared with the second quarter of 2015—the same quarter in which Exxon’s earnings plunged 59 percent annually.

The Consequences Of Big Oil’s Exploding Debt | OilPrice.com

China’s crude imports fell to the lowest level in six months as demand from independent refineries eased. Net fuel exports surged to a record. The world’s biggest energy user imported 31.07 million metric tons of crude in July, according to data released by the General Administration of Customs on Monday. That’s about 7.35 MMbpd, the slowest pace since January. Meanwhile, net fuel exports jumped to 2.49 million tons last month.

China crude imports fall to 6-month low as teapot demand slows

The Organization of Petroleum Exporting Countries will hold informal talks at a conference in Algiers next month and considers the recent decline in oil prices “temporary,” the group’s president said Monday. “Expectation of higher crude oil demand in the third and fourth quarters of 2016, coupled with decrease in availability, is leading the analysts to conclude that the current bear market is only temporary and oil price would increase during later part of 2016,” Mohammed Al Sada, Qatar’s energy minister and holder of OPEC’s rotating presidency, said in a statement on the group’s website. Members constantly discuss ways to stabilize the market, he said.

OPEC plans informal talks next month, sees oil dip temporary

Oil producers in the U.S. are proving more resistant to low prices, even as global supply is set to fall into a deficit next year. The Energy Information Administration increased its domestic output forecast for 2017 to 8.31 MMbopd from the 8.2 MMbopd projected in July, according to its monthly Short-Term Energy Outlook released Tuesday. Global oil consumption will exceed supply by an average 170,000 bpd next year, which compares with a 10,000 bpd surplus in July’s outlook.

U.S. oil production proves resilient as forecast increased

Saudi Arabia told OPEC that it pumped a record 10.67 MMbopd in July to meet a summer surge in domestic demand, an increase that will do nothing to endear OPEC’s leading exporter to other members seeking output limits to shore up prices.

Saudi Arabia said to report record oil output on summer demand

Saudi Arabia and Iran are showing no letup in their market share war, just days after OPEC announced an informal meeting to discuss ways to stabilize falling prices. The Organization of Petroleum Exporting Countries announced on Monday it will hold informal talks on the sidelines of a conference in the Algerian capital next month. Saudi Arabia, the world’s largest crude exporter, told OPEC that it boosted oil output to a record 10.67 MMbpd in July, two people with knowledge of the data said. Iran’s output is up to 3.85 MMbpd, Fars news agency reported, citing Oil Minister Bijan Namdar Zanganeh. That’s the highest since 2008, data compiled by Bloomberg show.

Saudi-Iran oil rivalry heats up as OPEC seeks to stabilize price

Argentina’s promising Vaca Muerta unconventional energy play could deliver approximately 560,000 bpd of liquids and 6 Bcfgd by 2040, increasingly meeting the country’s growing demands for energy with domestic production and helping reduce its dependence on imports, according to recent analysis from IHS Markit. However, this energy potential, which translates to a cumulative production of 2.8 Bbbl of oil (liquids), and 33 Tcf of gas by 2040, comes with some important caveats, IHS Markit said in its newly released IHS Energy Vaca Muerta Insight Series: Supply Scenarios for Argentina’s Energy Future. These include the need for significant annual investment of $8 billion in drilling and completion alone at peak activity, combined with continued government assurance of a stable business climate.

Vaca Muerta is key energy to Argentina energy exports, IHS Markit says

‘Our balances show essentially no oversupply during the second half of the year,’ International Energy Agency says. The world’s production of crude oil is falling behind demand, the International Energy Agency said Thursday.

IEA: Crude Production to Fall Behind Demand - WSJ

Venezuela’s President Maduro wants to raise oil prices to $70 – and fast. His plan, announced on Venezuelan television this week, is to somehow stabilize oil prices despite weak demand and near record production from Saudi Arabia, Russia, and Iran over the past several months. Maduro has a phone and he is using it (when the electricity works) to call every OPEC oil minister and some non-OPEC oil ministers to talk about cutting production. Not only is this strategy going to fail (the most important producing countries are not incentivized to freeze or cut production now), but Venezuela’s oil problems run much deeper.

Venezuela Is Drowning In Its Own Oil - Forbes

The long wait may finally be over. Since the great crash of oil in mid-2014, more than $100 billion has been raised by buyout firms and distressed-debt funds eager to scoop up energy assets on the cheap. But as the months rolled by, few opportunities cropped up as cash-starved drillers limped along with the help of their bankers. Not any more. What started out as a trickle has now turned into something much more

Investors Have $100 Billion to Spend on Oil Assets No One Else Wants - Bloomberg

While shale drilling in the U.S. is on the rise again, prices need to climb nearer to $60/bbl for U.S. producers to have a “substantial” boost in activity, the International Energy Agency said. Producers remain “cautious on outlook,” and further drilling increases this year may be “limited,” the IEA said in its monthly report. Drillers hired more rigs this year as U.S. oil prices staged a rally that saw futures close at $51.23/bbl in June, the highest so far this year. There were 381 active rigs as of Aug. 5, the highest number since March 18, according to Baker Hughes Inc. data. That number remains more than 75% below the October 2014 peak, the IEA said. Despite the gains in the rig count, the IEA reiterated its view that shale oil production will decline by half a million barrels a day this year with a further drop of 200,000 bpd next year. The number of completed wells will drop by half this year compared with last year, it said.

U.S. operators need $60 oil to stage real comeback, IEA says

U.S. oil producers added rigs for the seventh week in a row, the longest period of expansion since the final days of the drilling boom in early 2014. Rigs targeting crude in the U.S. rose by 15 to 396, after seven were added last week, Baker Hughes Inc. said on its website Friday. Explorers have now added 66 rigs since June 24, led by rising activity in the Permian basin in West Texas.

Operators bring back rigs in longest streak since 2014

The Kingdom is struggling with weak GDP growth, higher fees and taxes, and an economy that is unable to pay the dues to its workers, leaving thousands of workers from South Asia with an uncertain future. When a nation is unable to provide food to its migrant workers, it says a lot about their financial condition. The oil price crash has forced the oil-rich Kingdom to introduce austerity measures, and delay payments to already cash-strapped contractors.

Saudi Arabia can't afford low oil prices - Business Insider

The rebound in U.S. crude prices from a low of about $26/bbl this year hasn’t been big enough for Canadian energy CEOs to start celebrating. Oil is up about 67% from the February doldrums, at just over $40, after falling from a high above $50 in June. The current price is not enough to spur growth in the North American oil and gas industry, the CEOs of producers Crescent Point Energy Corp. and Birchcliff Energy Ltd. said in interviews on Thursday with Bloomberg TV Canada’s Pamela Ritchie.

Oil’s rally seen too low for industry growth, Canadian CEOs say

Crude climbed the most in three months amid speculation that oil producers could agree on moves to support prices during talks in September. Futures surged as much as 5.2% in New York. Talks with oil producers in Algiers next month could include possible action to stabilize the market, Saudi Arabia’s energy minister said, according to Reuters. Differences between Saudi Arabia and Iran caused the demise of a proposal to freeze production at an April summit in Doha.

Oil rises most since May after Saudi comments on producer talks

Oil climbed to its biggest weekly advance since April as Saudi Arabia signaled it’s prepared to discuss stabilizing markets at informal OPEC discussions next month after prices tumbled into a bear market. Futures rose 2.3% in New York after surging 4.3% on Thursday. Talks with OPEC members and other producers may result in action to stabilize the market, Saudi Arabia’s Energy Minister Khalid Al-Falih said in a statement, according to media reports including Reuters. Global markets will continue to rebalance this year, the International Energy Agency said Thursday.

Oil rises to weekly gain as Saudis reiterate wish for stability

The re-balancing of oversupplied oil markets is on track as demand climbs and U.S. shale production falters, according to the International Energy Agency. The oil glut could continue. The world will face a 560,000 bopd supply deficit in 2017 if OPEC members pump at the same rate as this year, IEA data show. If Iran and Iraq add just some of the new capacity they’re planning, Libya recoups a fraction of the supplies lost to political conflict and Nigeria restarts oil fields halted by militant attacks, there’ll be an 810,000 bpd excess—a fourth year of oversupply.

OPEC could still tip next year’s oil deficit into surplus

Santos Ltd. will take a $1.05-billion writedown on the value of its Gladstone LNG project due to rising prices for third-party natural gas supplies and slower than expected ramp up of its own equity output. The non-cash charge on the LNG export project in Queensland, which is $1.5 billion before taxes, will be recorded in its half-year results on Friday, the Adelaide-based company said in a statement Monday to the Australian stock exchange. The writedown won’t impact debt facilities, the country’s third-largest gas producer said.

Santos flags $1-billion Gladstone LNG charge on gas supply

Oil prices may have risen since the start of the month, but analysts believe the lackluster outlook for global demand – amid a shaky global growth environment and stubborn oversupply - should be more of a concern for investors. "One consideration (in the near-term) that we think is going to be more relevant is on the demand side, rather than supply," Marc Kofler, research analyst at Jefferies, told CNBC Monday.

Oil demand outlook should worry investors, analysts warn

The long decline in Venezuela’s oil production is becoming a supply risk for international markets, according to a report by Columbia University’s Center on Global Energy Policy. Exports from the holder of the world’s largest crude reserves fell more than 300,000 bopd in June, compared with the 2015 average, according to the report written by Luisa Palacios, a senior managing director at Medley Global Advisors LLC. While Venezuela’s output has been declining all year, the impact is only now being felt on international markets because previous losses were offset by slumping domestic oil demand amid an unprecedented economic recession.

Venezuela oil exports seen falling as economic woes worsen

Oil tycoon T. Boone Pickens boosted the value of his energy holdings by more than a third in the second quarter, just as the U.S. oil rig count was bottoming out from the worst crude-market crash in a generation. Energy stocks held by Dallas-based BP Capital Fund Advisors LLC rose by $55 million, or 34%, to $218 million in the second quarter, according to data compiled by Bloomberg. BP Capital added stakes in a total of 8 companies, including more than a handful of pipeline companies, such as Williams Partners LP, Plains All American Pipeline LP and Enbridge Energy Partners LP. He exited positions in a dozen other energy companies, including the world’s largest oil-services provider, Schlumberger Ltd.

Oil tycoon Pickens boosted energy holdings as rigs bottomed out

But Bank of America Merrill Lynch came out with an even more bullish call this week, upgrading energy stocks to overweight. The bank predicted crude will surge almost 50% from current levels to $69 a barrel by next June, pushing energy stocks ahead of the rest of the market.

BofA: Buy energy stocks because $69 oil is coming - Aug. 17, 2016

Following his bearish note last week, Morgan Stanley's oil analyst Adam Longson is out with a new report, in which he accurately explains that the recent oil-price jump is driven by traders covering bearish bets, even as market fundamentals are seen remaining weak in coming months.

Morgan Stanley: ‘’The Oil Rally Might End On Wednesday’’ | OilPrice.com

Prices which had been above $11 in Europe and between $15 and $18 in Japan in 2012--while Cheniere was building its export terminal--have now swooned to $4.51 in Europe and $6 in Japan. Even back in 2012 Cheniere's foray into LNG exports seemed like a risky proposition to me. What's worse for Cheniere is that the first signs of a U.S. natural gas production decline have appeared. Shale gas, the main driver of U.S. production growth, is expected to decline. That means that at some point supplies will shrink enough that U.S. prices will rise and likely make the margin between the U.S. price and European and Asian prices even smaller. And, as it turns out, the peak in U.S. natural gas production may arrive by 2020 if it hasn't already. In December of last year I suggested that one possible surprise in the year ahead was that several approved U.S. LNG projects might be delayed or canceled, something that seemed unlikely at the time. In late July Royal Dutch Shell announced that it was delaying a decision on whether to build an LNG export facility in Louisiana. Earlier in the month, the company announced a delay for a similar project in British Columbia.Just last week Sempra Energy announced a delay in further work on an expansion of its Louisiana-based LNG export operation. Outside North America a cancellation in Australia and a delay in Cameroon show that the problem is worldwide.

Is A Meaningful Rebound On The Horizon For U.S. Natural Gas? | OilPrice.com

OPEC is on course to strike an output-freeze deal with fellow oil producers in Algiers next month because its biggest members are already pumping flat-out, the group’s former president said. While a similar initiative failed in April, an agreement can now be reached as Saudi Arabia, Iran, Iraq and non-member Russia are producing at, or close to, maximum capacity, Chakib Khelil said in a Bloomberg Television interview. Khelil steered OPEC in 2008, the last time it implemented an output cut, which was announced in Algeria in December of that year.

OPEC’s former head says conditions are right for oil-freeze deal

U.S. crude oil is reaching all corners of the world, after a 40-year ban on exports was lifted at the end of last year. More than 87 MMbbl of crude and condensate have been shipped to 17 countries in the first half of 2016, based on Bloomberg calculations from Census Bureau data. Most has gone to Canada, which received 53.5 MMbbl, followed by Curacao, which took 8.68 MMbbl, and the Netherlands with 6 MMbbl. Canada was already a customer, having been largely exempt from the limits.

U.S. oil spreads across the world after export ban lifted

After spending billions of dollars constructing a world-class LNG export project in Australia, Santos Ltd. has found itself short of gas. The country’s third-largest energy producer, which isn’t pumping enough of its own gas to feed its Gladstone LNG plant yet, is having to buy expensive local supplies to fill the gap. Meanwhile, prices for the LNG that Santos is selling have plummeted by more than half in the past two years amid a supply glut driven in part by rising Australian production. A $200-billion investment splurge has put Australia on track to surpass Qatar as the largest global producer of LNG later this decade. At the same time that so much gas is being siphoned off for export, prices for natural gas within Australia have soared to more than double last year’s level.

Australia LNG export boom nips Santos amid gas pinch at home

Amid the back-and-forth about just what Saudi Arabia is doing in the oil market comes a message from BHP Billiton: Whatever it is, it's working. As my colleague David Fickling wrote earlier on Tuesday, the Anglo-Australian miner-cum-major is struggling to dig out from the commodities crash. One glaring blemish is its U.S. onshore oil and gas business, where it has spent almost $20 billion to buy its way into the fracing game—and written off more than half of that amount.

Saudi Arabia keeps BHP's shale oil in the ground...for now: Column

Possibly making matters worse in the long run are planned natural gas deliveries by pipeline from Russia to China starting in 2019 that might sell for around $10 to $11. If that becomes the ceiling price in China, LNG from the United States will almost surely be unable to compete for the large Chinese market. Because Cheniere is taking no price risk on almost all of its exports, the company may make out just fine no matter what happens to U.S. natural gas or world LNG prices.

Is A Meaningful Rebound On The Horizon For U.S. Natural Gas? | OilPrice.com

U.S. crude oil production is holding up better than the government previously thought. The output estimate jumped by 152,000 bopd for last week, the biggest increase since May 2015, according to the Energy Information Administration. Production didn’t actually increase by that amount but was modified to incorporate a “re-benchmarking” versus the agency’s Petroleum Supply Monthly, according to Jonathan Cogan, an EIA spokesman.

The 100,000-bbl oil output increase that didn’t really happen

Crude oil production disruptions in Nigeria reached 750,000 bpd in May 2016, the highest level since at least January 2009. The increased disruptions come as militants continue to focus attacks on oil and natural gas infrastructure in the West African region. Nigeria is a member of the Organization of the Petroleum Exporting Countries (OPEC) and was Africa's largest oil producer until Angola's oil production surpassed Nigeria's earlier this year.

Crude oil disruptions in Nigeria increase as a result of militant attacks

U.S. operators are adding the most oil rigs since crude was worth $100/bbl as confidence that OPEC may finally agree to freeze output pushed futures into a bull market. U.S. producers have put 76 oil rigs back to work in eight weeks, the biggest and longest increases since 101 were added a couple months before the price crash started in mid-2014, Baker Hughes Inc. data released Friday show. The count rose by 10 this week, bringing the total oil rig count to 406.

Permian adds yet more rigs as oil finds bull market

Woodside Petroleum Ltd. expects lower LNG prices as it renegotiates short-term contracts and says buyers across Asia will increasingly resist deals that restrict the reselling of the super-cooled fuel. The plunge in crude means suppliers are being forced to offer lower prices for oil-linked LNG deals even as buyers demand more flexible terms amid a global glut, according to Woodside CEO Peter Coleman. Japan, the world’s biggest buyer of the fuel, is investigating whether contracts that restrict buyers from resales impede free competition, Bloomberg News reported last month.

Woodside sees lower LNG prices as buyers push contract changes

The price of oil jumped for a third consecutive day in early trading on Monday after some reassurance for the markets that oil's biggest players are working to try to stabilise the world's most important commodity. Oil spiked by more than 1% earlier in the day following news out of Russia that the country is in talks with Saudi Arabia about the state of the oil industry.

Russia and Saudi Arabia discuss oil market stability and prices - Business Insider

Even if OPEC strikes a deal with Russia next month in Algiers to freeze oil production, success will mean a lot less than when they tried and failed four months ago. Oil has rallied more than 10% since the Organization of Petroleum Exporting Countries said that it will hold an informal meeting in the Algerian capital, fanning speculation the group could complete a supply agreement with rival producers that sputtered in April. Iran may now drop its refusal to join a freeze after restoring most of the crude output curbed by sanctions, a development analysts say makes a deal more likely, but also less worthwhile.

OPEC freeze wouldn’t be so potent as Gulf rivals pump more