OPEC, for some quiet moments..

[admin]

Saudi Arabia may run out of financial assets needed to support spending within five years if the government maintains current policies, the International Monetary Fund said, underscoring the need of measures to shore up public finances amid the drop in oil prices. QUICKTAKE Saudi Arabia The same is true of Bahrain and Oman in the six-member Gulf Cooperation Council, the IMF said in a report on Wednesday. Kuwait, Qatar and the United Arab Emirates have relatively more financial assets that could support them for more than 20 years, the Washington-based lender said.

Saudis Risk Draining Financial Assets in 5 Years, IMF Says - Bloomberg Business

Ecstrat's Emad Mostaque explains why he thinks crude oil prices are heading toward $130 a barrel. He speaks with Bloomberg's Alix Steel and Scarlet Fu on "What'd You Miss?"

Why Crude Oil Prices May Hit $130 a Barrel in 2017 - Bloomberg Business

Ten major energy companies declared their support for a global deal to prevent climate change, but stopped short of offering unanimous backing for carbon pricing. Producers including BP Plc, Saudi Arabian Oil Co. and Petroleos Mexicanos -- who together account for almost 20% of the world’s oil and gas output -- said in a statement that they will back policies consistent with the goal of keeping the increase in average global temperatures to within 2°C (3.6°F).

Big Oil companies back agreement to prevent climate change

Offshore resources remain attractive for new production with a breakeven price within the range of $60-65/bbl, concludes Rystad Energy’s in-depth October study of more than 20,000 non-producing liquid fields.  Offshore holds about one third of the global non-developed resources, where most of the resources are located in the Middle East, Brazil and Norway. These regions have benefitted from large offshore commercial discoveries, such as Lula and Libra (Brazil), Hamur (Saudi Arabia) and Johan Sverdrup (Norway).

Offshore still cheaper than shale while oil sands struggle: Rystad

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Much has been made about the impressive gains in efficiency and productivity in the shale patch, as new drilling techniques squeeze ever more oil and gas out of new wells. But the limits to such an approach are becoming increasingly visible. The U.S. shale revolution is running out of steam.

U.S. Shale Drillers Running Out Of Options, Fast | OilPrice.com

Santos Ltd., the third-largest oil and gas company in Australia, rejected a A$7.14-billion ($5.15-billion) takeover offer from an advisory firm that manages assets for Middle Eastern and Asian royals as too low and “opportunistic.” Scepter Partners’ bid of A$6.88 cash a share, priced at 26% more than the close Wednesday, “does not reflect the fair underlying asset value of the company,” Adelaide-based Santos said Thursday in a statement. Santos shares, which lost more than half its market value in the year to Wednesday, surged as much as 21% today, the most since March 1986.

Santos rejects $5.15-billion bid from royal asset manager

Mideast Oil Exporters Face $1 Trillion Budget Pinch, IMF Official Says If crude prices remain as low as they are, the combined shortfall in the next five years could be huge

Mideast Oil Exporters Face $1 Trillion Budget Pinch, IMF Official Says - WSJ

Iran will pay foreign oil companies larger fees than it did under previous buy-back contracts to attract $100 billion of investments needed to rebuild its energy industry. The Persian Gulf state, once OPEC’s second-largest crude producer, will also offer 20-year contracts on oil and natural gas projects, Roknoddin Javadi, managing director of state-run National Iranian Oil Co., said in an interview in Tehran.

Iran to Pay Oil Companies Larger Fees in 20-Year Contracts - Bloomberg Business

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Oil capped the biggest weekly decline since August as expanding U.S. crude stockpiles exacerbate a global glut. West Texas Intermediate crude fell to a three-week low, widening its discount to Brent. U.S. inventories expanded for a fourth week through Oct. 16, keeping supplies more than 100 MMbbl above the five-year seasonal average, according to the Energy Information Administration. Crude dropped even after China cut interest rates to help prop up its slowing economy.

Oil caps biggest weekly loss since August as supply glut deepens

U.S.-based Cheniere Energy (NYSE MKT: LNG) doesn't believe it will become Europe's leading liquefied natural gas (LNG) player despite bullish export plans. The company, headquartered in Houston, is at the forefront of what is being called a U.S. energy renaissance with plans to churn out its first batch of LNG for overseas shipments in the next few months.

Cheniere: We won't compete with Russia - Yahoo Finance

Woodside Petroleum Ltd. CEO Peter Coleman sees more time, not money, as the key to securing a takeover of Oil Search Ltd. “You don’t always have to sweeten deals,” Coleman said in an interview with Bloomberg TV’s Angie Lau on Monday. “What happens is that over time, expectations come together. You’re starting to see some M&A activity in Australia post the approach we made to Oil Search and you can see that peoples’ view of the world is starting to get a little closer.”

Woodside CEO plays waiting game in Oil Search takeover quest

Hedge funds placed the most bets on falling oil prices since July as rising piles of crude dashed hopes of a near-term recovery. Money managers’ short position in West Texas Intermediate crude jumped by 18% in the week ended Oct. 20, the largest surge since July 21, according to data from the Commodity Futures Trading Commission. That pulled their net-long position down by more than 16,000 contracts of futures and options.

Oil speculators make ‘easy’ bearish call at 85-year supply high

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Santos Ltd., which last week rejected a $5.2-billion takeover offer, has received a binding bid from Quadrant Energy Pty for Australian oil and gas fields the companies jointly own, people with knowledge of the matter said. Santos is considering the offer of about A$1.5 billion ($1.1 billion) for its stakes in the fields in Western Australia state as part of a broader review of its assets, according to the people. Japanese trading house Marubeni Corp. is separately in talks to buy 3.6% of Exxon Mobil Corp.’s Papua New Guinea liquefied natural gas plant from Santos for more than A$1 billion, the people said, asking not to be identified as the details are private.

Santos said to get $1.1-billion bid for Australia gas fields

The U.S. plans to sell millions of barrels of crude oil from its Strategic Petroleum Reserve from 2018 until 2025 under a budget deal reached on Monday night by the White House and top lawmakers from both parties. The proposed sale, included in a bill posted on the White House website, equates to more than 8 percent of the 695 million barrels of reserves, held in four sites along the Gulf of Mexico coast. Sales are due to start in 2018 at an annual rate of 5 million barrels, rising to 10 million by 2023 and totaling 58 million barrels by the end of the period. The proceeds will be “deposited into the general fund of the Treasury,” according to the bill.

U.S. Plans to Sell Down Strategic Oil Reserve to Raise Cash - Bloomberg Business

The majority of the North American oil and natural-gas shale industry players, from producers to midstream to refiners, are benefiting from the shale revolution, according to the survey. The 2015 survey offers an analysis and list of the top 250 global energy companies based on certain criteria, including 2014 financial performance for energy firms with assets of greater than $5 billion. Shale production had already helped the U.S. surpass Saudi Arabia and Russia to become the world’s largest producer of oil in 2014, according to Platts.

The U.S. shale revolution isn’t dead yet - MarketWatch

Iran’s crude exports are likely to remain restricted until the first half of next year, when it’s “reasonable” to expect international sanctions against the OPEC producer to be lifted, according to a U.S. government official. Overseas shipments will probably stay at 1 MMbpd to 1.1 MMbpd until the terms of a deal between Iran and world powers over the Persian Gulf state’s nuclear program are implemented, allowing sanctions to be lifted, said Amos Hochstein, special envoy and coordinator for international energy affairs at the U.S. Department of State. The U.S. is keeping a “very close” watch on Iranian oil exports, he said in an interview in Singapore.

Oil market may need to wait until 2016 for Iran supply boost

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Recognizing that the dominant theme at the moment is uncertainty, BG CEO Helge Lund told Gastech attendees during his keynote address yesterday, “I believe in the long-term future of our industry; I remain an optimist about the role of gas in the energy mix.” Three years ago, at Gastech in London, the conference discussion was about how LNG and shale gas were changing the industry, Lund noted. “The sharp fall in commodity prices has created volatility and challenged profitability and return across the sector,” he added. “Everyone in the industry has been impacted, including my own company.”

BG’s Lund sees “the end of boom and bust”

Exxon Mobil Gas & Power Marketing Company President Rob Franklin sat down and visited with Gas Processing, World Oil's sister publication, to explain his belief that the industry must find ways to satisfy strong LNG demand, even during low commodity prices. As companies balance the need for more gas to fuel a growing middle class while providing environmental benefits, they must find ways to economize projects.

Future demand mandates that new LNG projects proceed

Alexander Medvedev, Deputy Chairman of the Management Committee of Gazprom, addressed Gastech attendees on Tuesday afternoon in a keynote speech. Medvedev began his remarks by noting, "These are difficult times…but if you work hard, you can make progress." The chairman went on to discuss changes in the global LNG market in light of oil price declines. He also shared updates of Gazprom's LNG strategy for Asia-Pacific and its progress on the expansion of its Sakhalin-2 LNG terminal.

Gazprom targets expansion in evolving Asia-Pacific market

Royal Dutch Shell Plc made its second major strategic change in as many months, saying it will take a $2 billion charge as it shelves an oil-sands project in Alberta after walking away from an Arctic drilling program.

Shell shelves Alberta oil-sands project after leaving Arctic

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Get ready for some bad news and red ink. With the bulk of quarterly earnings reports in the energy industry yet to be announced, there are already $6.5 billion worth of asset write-downs, according to Bloomberg. And that could be just the tip of the iceberg. A Barclays’ assessment last week predicted $20 billion in impairment charges from just six companies.

Next Few Weeks Will Reveal Full Extent Of Oil Industry Suffering | OilPrice.com

Wood Mackenzie has outlined the key levers which will determine the global gas floor price as the market absorbs a wave of LNG in a new report prepared for Gastech 2015 With 130 MMtpa of additional LNG supply set to reach market over the next five years, coincident with faltering China demand, Wood Mackenzie asserts that new local floors for spot prices will be tested, unlocking new demand and curtailing supply, with global pricing implications.

New LNG supply will test global gas floor price: Wood Mac

The British oil giant also once again cut its spending plans, with expectations that capital expenditure will drop to $19 billion in 2015, then down to $17 to $19 billion per year through 2017. A year ago, the company had planned on spending $24 to $26 billion in 2015.

Why oil prices are crashing again - Business Insider

The Wall Street Journal reported that the four largest oil companies in the world – BP, ExxonMobil, Chevron, and Royal Dutch Shell – had a combined cash flow deficit of $20 billion in the first six months of 2015. All four have plans to bring spending down sufficiently so that revenues cover capex and dividends, but it may take a few years.

Why oil prices are crashing again - Business Insider

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The biggest oil explorers to post earnings so far are bracing for another year of deep spending cuts as the slump in energy markets shows no signs of abating. Occidental Petroleum Corp., Anadarko Petroleum Corp. and Hess Corp. reported third-quarter losses as sliding crude and natural gas prices choked cash flow, halted drilling projects and exacted billions of dollars in writedowns as once-prized oil fields dwindled in value. Norway’s Statoil ASA and UK-based BP Plc also are trimming spending.

Oil explorers prepare for another year of depressed prices

Royal Dutch Shell Plc reported its biggest net loss in more than a decade after halting some operations and lowering its oil-price expectations, resulting in a $7.89-billion charge. The company, which is buying BG Group Plc in the industry’s largest deal this year, reported a third-quarter net loss of $7.42 billion, compared with a profit of $4.46 billion a year earlier. The charges include $4.61 billion resulting from the withdrawal from drilling in Alaska and an oil-sands project in Canada, and $3.69 billion triggered by cuts to its outlook for oil and natural gas prices. Shares of the company fell as much as 1.8%.

Shell has biggest loss in more than a decade on price slump

ConocoPhillips reported its widest loss in more than six years as a crash in oil and gas prices tempered growth from Texas to Canada. The largest major U.S. oil company without refining operations lost $1.07 billion, or 87 cents a share, compared to a gain of $2.7 billion, or $2.17, a year earlier, the Houston-based company said in a statement. It was the biggest loss since the fourth quarter of 2008. Excluding one-time items, ConocoPhillips lost 38 cents a share in the third quarter, in line with the 38-cent average of 21 analysts’ estimates compiled by Bloomberg.

ConocoPhillips reports loss as oil crash limits shale growth

For Europe’s biggest oil companies, $60 is the magic number. BP Plc, one of the first companies to predict a prolonged price downturn, has “reset” its business to generate surplus cash flow with oil at about $60/bbl by 2017. It joins Total SA, which last month unveiled investment cutbacks and project delays that will enable it to fund dividend payouts in the same circumstances without the need to borrow.

Oil at $60 is the magic number for BP in prolonged downturn

[admin]

Dan Dicker, energy contributor at TheStreet, talks with Rhonda Schaffler about the outcome for OPEC nations and particularly Saudi Arabia, should oil prices stay low for more than three years. Dicker agrees with several projections that show the Saudis running through their cash surplus in five years, should oil remain under $50. The problem, Dicker states, is that so many other countries are in even weaker financial shape than the Saudis and would face massive shortfalls much sooner, including some US allies. Even the United States, with its current record oil production of 9 million barrels a day, would face a severe recession from lowered oil revenue, should prices not rebound.

Low Oil Prices Bankrupt OPEC in Five Years - Rest of World Does it in Three - Video - TheStreet

The International Monetary Fund predicts Saudi Arabia could be broke and have a fiscal deficit of 21.6 percent of its gross national product in five years as oil prices continue to linger at low levels.

IMF: Saudi Arabia to Run Out of Cash in Less Than 5 Years Amid Cheap Oil

Low oil prices will wipe out an estimated $360 billion from the region this year alone, the IMF said. Saudi Arabia, the world's largest oil producer, needs to sell oil at around $106 to balance its budget, according to IMF estimates. The kingdom barely has enough fiscal buffers to survive five years of $50 oil, the IMF said.

IMF: Saudi Arabia to Run Out of Cash in Less Than 5 Years Amid Cheap Oil

Royal Dutch Shell Plc’s decision to put on ice its Carmon Creek drilling project, announced Tuesday, lengthens the list of oil-sands developments that companies have scrapped or deferred in the market downturn to 18, according to ARC Financial Corp.

Oil-Sands Exodus Seen Curbing Canada Economic Growth After 2020 - Bloomberg Business

[Putncalls]

Everything has a balance. 50$ oil doesn't balance.

[Thylacine-2]

Admin, what's your take on the notion that prolonged low oil prices would lead to a recession?
In the past a low oil price was considered a stimulus. Perhaps that was when the economic activity (cost) to produce the oil was relatively low.