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RE: OPEC, for some quiet moments.. - admin - 03-30-2017

Libya’s biggest oil field was said to stop producing, leading to a 20% decline in crude output from the country with Africa’s largest reserves. The OPEC nation is pumping 560,000 bpd, according to a person familiar with the matter. The North African country was pumping 700,000 bpd, Mustafa Sanalla, chairman of state-run National Oil Corp., said on March 22. The pipeline carrying crude from Sharara, Libya’s biggest field, to the Zawiya refinery stopped operating, according to another person who asked not to be identified.

Libya's oil output drops after biggest field said to close

Prices for light crude surged in Canada and the northern U.S. after an oil-sands upgrader shut for maintenance because of a fire and reduced supply caused by preparations to place the Dakota Access pipeline into service.

Canada, Bakken light oil jump as supply cut meets demand surge

Russia can wait for a sustained recovery in oil prices before drilling again in Arctic waters, relying for now on less costly regions even as rival producer Norway accelerates development of its northerly fields. “We estimate production costs for the Russian Arctic offshore in the range of $70 to $100/bbl,” Energy Minister Alexander Novak said by email. These reserves “are our backup stock,” he said before the International Arctic Forum in Russia’s Arkhangelsk that began Wednesday.

Russia can wait for $70 oil before re-entering Arctic waters

The oil market is risking a supply crunch as producers cut spending on major projects to focus on short-term low-cost shale output in the U.S., some of the top crude and products traders said. With oil prices hovering around $50/bbl, current project spending is focused on “short-cycle” projects involving U.S. shale deposits, Daniel Jaeggi, president of Mercuria Energy Group Ltd., said at the FT Commodities Global Summit in Lausanne, Switzerland, Wednesday. Hedging activity by these same producers is keeping future prices low until 2020, which is dissuading investment in major oil projects, he said.

Oil traders warn supply crunch looming as project spending drops




RE: OPEC, for some quiet moments.. - admin - 03-31-2017

According to a recent Wood Mackenzie report, a leaner and more cost-competitive deepwater industry is emerging from the downturn, with the most attractive projects now competing with U.S. tight oil plays. 2017 will see a noticeable pick-up in deepwater project sanctions, with three projects, Mad Dog Phase 2, Kaikias and Leviathan, already fully approved.

Wood Mackenzie: Some deepwater projects closing cost gap with tight oil plays

ConocoPhillips has signed an agreement with Cenovus to sell its 50% non-operated interest in the Foster Creek Christina Lake (FCCL) oil sands partnership, as well as the majority of its western Canada Deep basin gas assets, for a total of $13.3 billion. ConocoPhillips Canada will retain its operated 50% interest in the Surmont oil sands joint venture and its operated 100% Blueberry-Montney unconventional acreage position.

ConocoPhillips sells oil and gas Canadian assets to Cenovus for $13.3 billion

The price action of natural gas is very bullish considering all that had been thrown at it this winter. The lows are likely in, and although the rally may be slow to develop, I think it is reasonable to expect a rally above $4 later this year.

Natural Gas: What To Expect In 2017 | Seeking Alpha

Russia has cut crude oil production by 200,000 barrels daily, Energy Minister Alexander Novak said. That’s two-thirds of the amount it agreed to cut under the OPEC-non-OPEC agreement closed at the end of last year.

Russia Reaches 2/3 Of Oil Output Cut Target | OilPrice.com




RE: OPEC, for some quiet moments.. - admin - 04-02-2017

Using a proprietary app called iSteer, Brian Tapp, a geologist for EOG Resources Inc., dashed off instructions to a drilling rig 100 miles away. This tool is among the reasons the little-known Texas company says it pumps more oil from the continental U.S. than Exxon Mobil Corp.—or any other producer.

Fracking 2.0: Shale Drillers Pioneer New Ways to Profit in Era of Cheap Oil - WSJ

The oil market is risking a supply crunch as producers cut spending on major projects to focus on short-term low-cost shale output in the U.S., some of the top crude and products traders said.

Oil Traders Warn There's a Supply Crunch Looming - Bloomberg

Chevron has started production of liquefied natural gas (LNG) from the third of three production units at the Gorgon LNG project located off Western Australia, the company said on Tuesday. Chevron is the operator of the $54 billion project that has a total of three production trains with a combined production capacity of 15.6 million tonnes per year. First production of the supercooled fuel from Gorgon began in March last year, but the plant has been plagued by numerous unplanned outages since then.

Chevron starts production at Gorgon Train Three LNG project | Reuters

U.S. shale producers are drilling at the highest rate in 18 months but have left a record number of wells unfinished in the largest oilfield in the country – a sign that output may not rise as swiftly as drilling activity would indicate. Rising U.S. shale output has rattled OPEC's most influential exporter Saudi Arabia and pushed oil prices to a near four-month low on Wednesday. U.S. production gains are frustrating Saudi-led attempts by the world's top oil exporters to cut supply, drain record-high inventories and lift prices.

All drill, no frack: U.S. shale leaves thousands of wells unfinished | Reuters




RE: OPEC, for some quiet moments.. - admin - 04-03-2017

Crude stockpiles are starting to decline in a sign that the production cuts implemented this year are bringing the market to balance, according to OPEC’s Secretary-General Mohammad Barkindo. An overhang of an estimated 285 MMbbl of oil in storage has been a drag on crude prices even as OPEC and some non-members producers curbed output. Six members of the Organization of Petroleum Exporting Countries and Oman back extending production cuts beyond June, with Saudi Arabia and Kuwait saying oil stockpiles need to fall to the five-year average.

OPEC's Barkindo sees progress in oil cuts as stockpiles shrink

Oil headed for its biggest weekly increase this year amid speculation OPEC will extend its deal to curb output and ease a global glut. Futures are up 4.7% in New York this week, climbing back above $50/bbl after Kuwait Oil Minister Issam Almarzooq reiterated support for prolonging a six-month deal to trim supply past June. Still, prices are down 6.5% this quarter, their biggest three-month loss since late 2015, as U.S. crude stockpiles continue to pile up.

Oil set for biggest weekly gain in 2017 as OPEC eyes extension

Four years ago, Canada’s government tried to keep state-owned companies out of Alberta’s oil sands. Now, they may be around for a while. ConocoPhillips, Marathon Oil Corp. and Royal Dutch Shell Plc decided this month to sell most of their oil sands to Cenovus Energy Inc. and Canadian Natural Resources Ltd. That leaves firms such as China’s Cnooc Ltd. among the last foreigners holding major stakes in the bitumen-soaked soil of northern Alberta.

State oil companies stay in oil sands as Conoco, Shell exit

China has a knack for putting stars in commodity executives’ eyes, and then knocking them out. With oil once again under pressure—global benchmark Brent is down 10% since the beginning of March—investors are firmly focused on buoyant U.S. supply as the main risk factor for further declines. But as with a few years ago, it is weaker demand from China that could deliver a punch to staggering oil markets.

China Tanked Oil Once, It Can Do It Again - WSJ




RE: OPEC, for some quiet moments.. - admin - 04-04-2017

Qatar Petroleum plans to start a new development in the offshore North field, ending a 12-year ban on new projects that allowed the company to assess how its current rate of extraction affects the giant reservoir it shares with Iran. The patch, in the southern section of the field, will have a capacity of 2 Bcfgd, or 400,000 boe, and should start production in five to seven years, CEO Saad Sherida Al Kaabi told reporters Monday at Qatar Petroleum’s headquarters in Doha.

Qatar to drill in biggest gas field after 12-year freeze

Crude traded near $50/bbl as a rebound in Libyan oil production and U.S. supply gains countered optimism that OPEC would continue to restrain output. Futures in New York fluctuated after rising 5.5% last week. Libya’s output rose to about 660,000 bpd as the OPEC member’s biggest oil field resumed pumping, a person familiar with the matter who asked not to be identified said. OPEC Secretary-General Mohammad Barkindo said Sunday that he is “cautiously optimistic that the market is already rebalancing,” while data on Friday showed the number of active oil rigs in the U.S. rose to the highest since September 2015.

Oil trades near $50 as Libya output rebound offsets OPEC cuts

When it comes to petroleum, the U.S. is the land of plenty. The year 2017 started off with a bang for American oil companies as total crude and petroleum products exports rose to a record 5.69 MMbpd in January, government data show. A surplus of fuels means exports are available all the way down the hydrocarbon chain from crude to propane as resilient U.S. shale producers are learning to grow their output with oil dancing around the $50/bbl mark.

U.S. petroleum exports climb to record as crude output grows

Malaysia’s Petroliam Nasional Bhd may be looking at building a $27-billion liquefied natural gas export terminal in northwestern Canada on the site of an abandoned Royal Dutch Shell Plc energy project, according to the company’s CEO. While Petronas, as the state-owned company is known, has yet to make a financial decision to move forward with its Pacific Northwest LNG project in British Columbia, Shell’s Ridley Island site “could be one of the options” for a location for the complex, CEO Wan Zulkiflee Wan Ariffin said in an interview in Kuala Lumpur on Friday.

Petronas to consider Shell site for Canadian LNG project




RE: OPEC, for some quiet moments.. - admin - 04-05-2017

Crude stockpiles are starting to decline in a sign that the production cuts implemented this year are bringing the market to balance, according to OPEC’s Secretary-General Mohammad Barkindo. “I remain cautiously optimistic that the market is already rebalancing," Barkindo told reporters Sunday in Baghdad. “We have started seeing stock levels coming down.”

OPEC's Barkindo Sees Progress in Oil Cuts as Stockpiles Drop - Bloomberg

Oil prices are not capped around $55 as is widely assumed but rather are on track to hit $70 per barrel later this year, according to Pierre Andurand, managing partner at Andurand Capital Management. We're currently at a crossroads from where oil prices should significantly rebound, Andurand told CNBC on the sidelines of an event Thursday evening where he was crowned the winner of the EMEA Investor's Choice Awards for 2017.

One of the world's best-known oil traders is predicting prices to recover to $70 a barrel

For traders trying to decipher if Opec’s output cuts are finally tightening the oil market, the evidence may lie out at sea. Data provided to the Financial Times show that crude oil being shipped over the oceans or stored on supertankers has dropped by as much as 16 per cent since the beginning of the year, in a signal that supplies could be dropping faster than many in the market believe.

Oil’s seaborne picture suggests Opec cuts taking effect

OPEC isn’t the only decades-old energy hegemony being turned on its head by U.S. shale. Liquefied natural gas sellers from Qatar to Malaysia that dominated gas sales to Asia for years are facing the prospect of rising American exports. While less than 30 U.S. cargoes have landed in Asia, their effect was felt even before they arrived. LNG trade in 2016 jumped the most in five years, contract lengths were sliced in half in the past decade, and spot prices slumped more than 60 percent in the past three years.

Gas Giants Share OPEC's Shale Pain as U.S. Supply Flows East - Bloomberg




RE: OPEC, for some quiet moments.. - admin - 04-06-2017

Oil climbed on forecasts that U.S. crude inventories have dropped from a record high as refineries boosted operating rates. Futures in New York erased earlier losses to gain as much as 0.9%. U.S. crude supplies probably fell by 700,000 bbl last week, according to a Bloomberg News survey of analysts before an Energy Information Administration report Wednesday. The industry-funded American Petroleum Institute will release its weekly data Tuesday. OPEC output fell by 200,000 bpd in March, helped by cuts in Nigeria and Libya that aren’t part of a production-curbing agreement, according to a Bloomberg News survey.

Oil advances on speculation U.S. crude, fuel stockpiles declined

Saudi Arabia is to tweak the benchmark it uses to sell its crude in Europe, in a concession to refiners in the region that have long complained about their ability to hedge using the current measure. Saudi Arabian Oil Co., as the country’s state-owned company is formally known, will sell crude into Europe, Africa and Latin America based on ICE Brent Settlement, a one-day close for the benchmark, rather than the current system of using the daily weighted average of Brent trades. Both are published by ICE Futures Europe Ltd.

Saudi Arabia to switch crude oil pricing for Europe

Canadian crude shipments to the U.S. are poised to shrink just as the effects of OPEC-led output cuts are being felt in the Caribbean. That’s good news for Mexico and other local oil producers. Syncrude Canada told customers they wouldn’t receive any supply in April from its 350,000 bpd upgrader, according to people familiar with the matter. The plant, which turns bitumen from Alberta’s oil sands into light synthetic crude, moved forward maintenance following a fire last month. Light crude and condensate jumped to the highest level in more than a year last week, and Western Canadian Select on Monday was the strongest since June 2015, when wildfires in Alberta disrupted production.

Canadian oil disruption, OPEC output cuts open door for Mexico

When militants in Nigeria’s southern Niger River delta started attacking oil installations, President Muhammadu Buhari promised to crush them by force. A year and $7 billion in lost oil exports later, his decision to switch tack by negotiating with the fighters seems to be working. All but one force majeure, a clause that gives oil producers the right to miss supply obligations, have been lifted since peace talks were initiated in November with militants. Shipments at Forcados, the nation’s third-largest export terminal, are on course to restart in the second quarter. Nigeria rivals Angola as Africa’s biggest oil producer.

Buhari's change of tack in Nigeria Delta boosts oil output




RE: OPEC, for some quiet moments.. - admin - 04-07-2017

Eni has made a new discovery of gas and condensates offshore Libya in the ‘Gamma Prospect‘, in the Contract Area D, 140 km offshore from Tripoli, in Libya. The discovery, made through the well B1 16/3, is located 15 km south west of the Bouri field and 5 km north of the Bahr Essalam field. The drilling of the Gamma prospect is part of the “near-field” exploration strategy of Eni, targeting opportunities, that in case of success can exploit synergies with existing infrastructures reducing the time to market and providing additional gas to the local market and export.

Eni discovers gas, condensate offshore Libya

Saudi Arabia lowered oil pricing for European customers, a sign the world’s biggest crude exporter is seeking to expand market share in the region dominated by Russia. State-owned Saudi Arabian Oil Co. lowered its official selling pricing for all grades to northwest Europe for the second straight month, along with all prices to the Mediterranean and some to Asia, against regional benchmarks. It raised the pricing of all sales to the U.S., it said Wednesday in an emailed statement.

Saudi Aramco cuts oil pricing for Europe, where Russia dominates

A year after Cheniere Energy Inc.’s Louisiana terminal shipped the first exports of U.S. natural gas from shale, cargoes from the facility are fetching higher prices than ever. The export price of liquefied gas from Sabine Pass rose as high as $7.52/MMbtu in January, topping last year’s high of $6.21, according to an Energy Department report Friday. Fifteen tankers sailed from the terminal that month and in February, the most since commissioning began at the facility last year.

America's shale gas selling at record prices to overseas buyers

A surge in hedging contracts is helping U.S. shale drillers ride out the turmoil in global oil markets this year. Next year may not be so easy. As of March, the biggest explorers had hedged 28% of this year’s production, according to Warren Russell and Michael Cohen of Barclays Plc. Those contracts, which lock in future payments, are expected to help U.S. output reach a “multi-decade high by December, within sights of the all-time high reached in 1970," the analysts wrote in a note to clients.

Shale drillers face uncertain 2018 with most hedges expiring




RE: OPEC, for some quiet moments.. - admin - 04-10-2017

Horizontal drilling in the Permian basin is creating a new kind of swap meet. Working with fresh technology that lets producers drill longer wells than ever before, companies such as Pioneer Natural Resources Co., Parsley Energy Inc. and Double Eagle Energy Permian LLC are increasingly haggling with other producers for slivers of land that allow them to extend the reach of their drilling with hardly any acquisition costs.

Land swaps let Permian operators expand shale wells on the cheap

An historic agreement between OPEC countries and other oil producers to reduce their output won’t be enough to nudge crude prices above $60/bbl this year, according to energy lender Arab Petroleum Investment Corp. Consumer countries have built up large stockpiles of crude during nearly three years of low prices, and U.S. shale production is rebounding as prices have recovered since OPEC reached the production deal November. That means the process of balancing the market will take at least until the second half of this year, the company known as Apicorp said Monday in a report.

Oil prices seen stuck below $60 this year as high stocks persist

One of the things we learned when oil collapsed a couple of years ago—something I’ve written about previously—was that there was a positive feedback loop embedded in declining oil prices. Basic economic theory would tell you that as the price declines, so does oil supply. But the opposite turned out to be true. The price went down, and people pumped more!

Oil has been defying economic theory - Business Insider

I am tired of hearing about the unbelievable impact of technology on collapsing U.S. shale production costs. The truth is that these claims are unbelievable. The savings are real but only about 10 percent is from advances in technology. About 90 percent is because the oil industry is in a depression and oil field service companies have slashed prices to survive.

Tech Miracle In U.S. Shale Is A Media Myth | OilPrice.com




RE: OPEC, for some quiet moments.. - admin - 04-10-2017

An ongoing disruption at Canada’s second-biggest oil sands upgrader has sent prices soaring from Alberta to Louisiana. A fire at Syncrude Canada Ltd.’s plant is restricting supplies of both light synthetic crude and heavy Alberta oil. Syncrude, which can process 350,000 bpd of bitumen from oil sands formations, moved forward maintenance following the fire last month. The worst disruption since a wildfire forced companies to reduce production last year has reduced output from ConocoPhillips’s Surmont site, which mixes light oil produced at Syncrude with bitumen to make it flow through pipelines.

Canadian oil disruption sends ripples from Alberta to Louisiana

China is set to import record amounts of crude oil from West Africa this month as OPEC’s supply cuts pave the way for other nations to gain a greater foothold in the fast-growing Asian market. West African producers led by Angola and Nigeria are poised to send crude to China at the rate of 1.48 MMbpd in April, the most since Bloomberg began compiling the data in August 2011, according to loading programs and traders. Overall Asian imports of West African crude are poised to reach 2.4 MMbpd this month, also a record.

China binging on African oil like never before after OPEC cuts

Baker Hughes announced today that the average U.S. rig count for March 2017 was 789, up 45 from the 744 rigs counted in February 2017, and up 311 from the 478 rigs counted in March 2016. The average Canadian rig count for March 2017 was 253, down 89 from the 342 rigs counted in February 2017, and up 165 from the 88 rigs counted in March 2016.

U.S. rig count climbs by 311 from March 2016

President Donald Trump is preparing to issue an executive order with the goal of giving oil companies more opportunities to drill offshore, reversing Obama-era policies that restricted the activity.  The offshore drilling directive is set to be issued soon, Interior Secretary Ryan Zinke told an industry conference in Washington on Thursday, according to three attendees who spoke on condition of anonymity to discuss a session closed to the press. Zinke did not provide specific details on the executive order during his presentation to the National Ocean Industries Association.

Trump said to ready order to expand offshore oil drilling