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RE: OPEC, for some quiet moments.. - admin - 07-09-2017

Top liquid natural gas exporter Qatar announced it will hike its output by 30 percent in the coming years. The increase overlaps with an anticipated glut in the LNG market and efforts by U.S. companies to increase natural gas exports. LNG exports are a critical part of President Donald Trump's plans for American "energy dominance."

Qatar to boost LNG exports, throwing a wrench in Trump's energy plans

The CEOs of ExxonMobil, Royal Dutch Shell and France's Total all met the emirin Qatar before it announced a plan on Tuesday to raise output of liquefied natural gas by 30 percent. Company and industry sources told Reuters that the CEOs had expressed interest in helping Qatar with its ambition to produce 100 million tons of LNG annually. Qatar, the world's largest LNG supplier and second biggest gas exporter after Russia, has some of the lowest production costs.

Big Oil is backing Qatar's ambitious natural gas expansion

IHS' Dan Yergin said costs for shale producers getting lower and lower, pressures oil prices Low shale production costs not helping to rebalance oil supply and demand IHS forecast oil to average lower end of $50 a barrel for 2017

Two things are getting in the way of OPEC's scheme to boost oil prices

Mark Fisher forecast natural gas prices will break $4 or $5 per mmbtu once a streak of warm winters breaks. Fisher says general investors could buy into natural gas drillers rather than trying to time commodity price moves. Fisher is less bullish on oil drillers and thinks crude will remain stuck in a range between $40 and $50 a barrel for some time.

Mark Fisher: Natural gas will break out above $4 or maybe $5

RE: OPEC, for some quiet moments.. - admin - 07-10-2017

The world’s biggest energy traders are betting shale oil production is here to stay. European trading houses from Trafigura Group to Mercuria Energy Group and Vitol Group have invested in U.S. infrastructure and struck supply deals to secure flows of shale oil and gas. The agreements show the traders see long-term opportunities in an industry that has already upended global energy flows, particularly since the U.S. lifted a four-decade old ban on exports at the end of 2015.

World's top oil traders bet American shale is here to stay

As if billions of dollars of liquefied natural gas project cost overruns and the prospect of a glut well into the next decade weren’t enough, proposed export sites now face increased competition from the world’s biggest producer. Qatar’s announcement Tuesday that it would double production from the giant North Field comes as more than two-thirds of new projects due in the next decade from Texas to Australia are yet to take investment decisions. The sheikdom, which started some of the largest plants at the end of the last decade, has one of the lowest break-even prices, according to Sanford C. Bernstein & Co.

Qatar flexing LNG muscle puts U.S., Australia at risk

U.S. energy firms added oil rigs for a 24th week as the year-long drilling recovery continues but the pace of additions has slowed in recent months, as crude prices declined despite OPEC-led efforts to end a global supply glut. Drillers added seven oil rigs in the week to July 7, bringing the total count up to 763, the most since April 2015, Baker Hughes energy services company said in its closely followed report on Friday.

Pace slows as U.S. drillers add seven rigs

Now is the time to maximize the impact of OPEC’s oil production cuts, yet the market is still waiting for the group’s biggest member to show it’s doing “ whatever it takes” to eliminate the global oversupply. OPEC’s best chance to make a big dent in the lingering glut in the U.S., and with it reverse oil’s three-year slump, lies in the remaining weeks of peak summertime demand. That’s already become harder because of the resurgence in output from OPEC members exempt from cuts, while there are no signs yet that Saudi Arabia, the group’s de-facto leader, is willing to cut as deeply as it did earlier in the year.

No sign of Saudi “whatever it takes” at critical OPEC moment

RE: OPEC, for some quiet moments.. - admin - 07-11-2017

Saudi Aramco, which plans what could be the world’s biggest initial public offering, will invest more than $300 billion over the next decade to maintain its spare oil-production capacity and explore for more natural gas, President and CEO Amin Nasser said. The outlook for oil supplies is “increasingly worrying,” with about $1 trillion in investments lost during the current industry downturn and fewer new deposits being discovered, Nasser said at a conference in Istanbul.

Aramco to spend $300 billion as CEO warns about world oil supply

Libya and Nigeria may attend a joint meeting between OPEC and non-OPEC this month, Russia's energy minister said on Monday, as oil producers look for ways to cap rising production to help support oil prices. Both nations have boosted production since they were exempted from an OPEC-led deal to cut output, weighing on global prices. This has prompted more talk among producers about including them in the pact.

Libya, Nigeria may attend OPEC, non-OPEC meeting on July 24

The tussle for supremacy between OPEC and U.S. shale drillers is killing off older oil fields at the fastest pace in almost a quarter century. That could hurt the industry once the current glut has faded. The three-year price slump triggered by the battle for market share choked off funds for aging deposits elsewhere, accelerating their decline. Output at older fields from China to North America -- making up a third of world supply -- fell 5.7% last year, the most since 1992, according to Rystad Energy AS. It’ll drop about 6% in 2017 if oil stays at current prices, the consultant said.

Mature fields seen dying amid OPEC, shale tussle

Money managers last week raised their bets on a price rise in Brent crude oil futures for the first time in a month, according to data from the InterContinental Exchange. ICE positioning data released on Monday showed speculators raised their net long holdings of Brent crude futures and options by 30,663 lots to 230,867 contracts in the week to July 4, the first increase since the week of May 30.

Money managers raise bullish bets on Brent crude

RE: OPEC, for some quiet moments.. - admin - 07-12-2017

The energy component of the Standard and Poor’s Goldman Sachs Commodity Index (GSCI) fell 11% during the first half of 2017, the largest decline for any commodity group in the index. Other components of the index—livestock, industrial metals, precious metals, and agriculture—had end-of-June prices that were higher than at the beginning of the year. Supply-side developments unique to energy commodities likely contributed to the divergence.

Energy commodity prices declined more than other commodities in the first half of 2017 - Today in Energy - U.S. Energy Information Administration (EIA)

Total is well placed to take a lead role in helping Qatar expand output from the world's largest gas field, largely thanks to its involvement in the Iranian side of the shared deposit, two sources familiar with Doha's thinking said. That puts the French oil major ahead of rivals like Exxon and Shell in the early running for developing the expansion, which the tiny Gulf state announced as it seeks to counter growing isolation caused by a regional diplomatic rift.

After Iran move, Total seen in pole position to snap up Qatar gas deals

The tussle for supremacy between OPEC and U.S. shale drillers is killing off older oil fields at the fastest pace in almost a quarter century. That could hurt the industry once the current glut has faded. The three-year price slump triggered by the battle for market share choked off funds for aging deposits elsewhere, accelerating their decline. Output at older fields from China to North America -- making up a third of world supply -- fell 5.7 percent last year, the most since 1992, according to Rystad Energy AS. It’ll drop about 6 percent in 2017 if oil stays at current prices, the consultant said.

Oil Fields Pumping a Third of Supply Die Fastest in 24 Years - Bloomberg

Rumors are circulating there is a physical crack in a key component of one of the most expensive liquefied natural gas projects in history This crack could be costing billions of dollars in delays and repairs Multiple sources told CNBC they had heard of a crack, and one claimed firsthand knowledge of its existence When asked whether the rumored crack is real, Inpex said it "cannot provide details concerning reasons for the delay"

Inpex Ichthys LNG Project: Investors are worried there's a multibillion-dollar crack

RE: OPEC, for some quiet moments.. - admin - 07-13-2017

Oil fell in New York, erasing earlier gains, after Saudi Arabia’s production last month was said to have risen above the cap it agreed on with fellow OPEC members. Photo: Saudi Aramco. Futures slid 1% after advancing 1.2% earlier. Saudi Arabia told OPEC it raised output by 190,000 bpd to 10.07 million in June, a person familiar with the matter said, higher than 10.058 million limit set last year. That’s the opposite of the “shock and awe” strategy of deeper cuts Goldman Sachs Group said producers should be adopting.

Oil slides as Saudi Arabia is said to produce above output cap

U.S. crude producers are still set to pump record amounts of the commodity next year, but less so than previously projected, according to the latest government estimates. Domestic output will average 9.9 MMbpd next year, the U.S. Energy Information Administration said in its monthly Short-Term Energy Outlook released Tuesday. That’s down from a June estimate of 10.01 MMbbl. The previous annual record of 9.6 million was set in 1970.

U.S. cuts 2018 crude production forecast amid lower prices

OPEC needs to “shock and awe” the oil market for prices to gain, according to Goldman Sachs Group. OPEC must increase output cuts aimed at shrinking a global glut with little public announcement in order to jolt investors, the bank said in a July 10 report. Without such action and no evidence of sustained declines in inventories as well as U.S. drilling activity, prices could slump below $40/bbl, analysts including Damien Courvalin and Jeffrey Currie wrote in the note.

Goldman warns of oil below $40 without OPEC "shock and awe"

A proposal that Libya and Nigeria could have to accept limits on their crude production probably wouldn’t be enough to put OPEC’s faltering efforts to eliminate a global supply glut back on track. The two African nations -- exempt from the supply curbs agreed last year due to internal strife -- have added enough production in the last two months to offset Saudi Arabia’s cut. Should the pair accept a cap at their desired levels of output, OPEC and allies including Russia would still have to adjust their own quotas to compensate for the increase, said Nordine Ait-Laoussine, president of Geneva-based consultants Nalcosa and former energy minister of Algeria.

Production caps for Libya, Nigeria wouldn't fix global glut

RE: OPEC, for some quiet moments.. - admin - 07-14-2017

Halliburton expects that the worst crude crash in a generation will lead to a spike in oil prices by 2020. Tumbling oil prices brought on by a glut of global oil has forced the industry to slash about $2 trillion in investments, according to the world’s biggest fracking provider. Those cuts will weigh heavily on the market in a few years when oil supplies fail to keep up with demand, Mark Richard, the company’s senior vice president for global business development said Wednesday in an interview at the World Petroleum Congress in Istanbul. "Sooner or later, the market is going to catch up," Richard said. "You’ll see some kind of spike in the price of oil. Maybe somewhere around 2020-2021, but it’s got to catch up sooner or later."

Halliburton sees 2020 oil spike after industry cuts $2 trillion

Saudi Arabia might not be as frustrated as one would expect by the oil market’s weakness in the face of a coordinated cut by major global crude producers. The Saudis are playing a longer game, write analysts at RBC Capital Markets, in a Thursday note. That’s because the key elements of the country’s ambitious Vision 2030 program to wean its economy off oil are 2018 events, notes Helima Croft, RBC’s global head of commodity strategy. That includes the crucial partial listing of state-owned Saudi Arabian Oil Co, known as Saudi Aramco, which could value the firm at as much as $2 trillion.

Saudi Arabia’s worst-case oil scenario might surprise you - MarketWatch

API today announced that estimated total wells drilled and completed in the second quarter of 2017 increased 62% compared to the second quarter of 2016. This includes a 41% increase in estimated development gas well completions and a dramatic 81% increase in total estimated oil well completions from year-ago levels. Total estimated oil well completions also increased 19% from the first quarter of 2017. Growing well completion figures could lead to an increase in U.S. oil production, which rose 62% from 2010 to 2016, and U.S. natural gas production which, also increased 26% during the same time.

API: Oil and gas drilling sees 62% increase over 2016 levels

When OPEC and its allies unveiled their plan last year to re-balance world oil markets, prices rallied and most analysts expected the supply cuts would succeed. With the strategy now faltering, one bank that predicted failure says the group should call it quits. There’s been a wave of price-forecast downgrades over the past month as analysts from Goldman Sachs Group Inc. to Bank of America Corp. and Citigroup Inc. acknowledged that OPEC’s production curbs haven’t cleared a global glut. One forecaster who’s kept his outlook unchanged is Commerzbank AG’s Frankfurt-based head of commodities research Eugen Weinberg, who never believed the cuts would work in the first place.

Contrarian who predicted OPEC's woes says group should end cuts

RE: OPEC, for some quiet moments.. - admin - 07-15-2017

Rising U.S. shale production is feared to keep oil prices under pressure this summer Oil prices rising back above $50 a barrel this summer? Forget about it, says Barclays’ oil analysts in their latest outlook on the commodity. The U.K.-based bank, in the report out on Tuesday, cut its third-quarter Brent LCOU7, +1.38%  oil forecast to $49 a barrel, down from a previous forecast of $57. For West Texas Intermediate CLQ7, +1.30% the analysts see prices trading around $47 for the quarter, down from around $55 expected previously. “The recent weakness reflects the market’s need to price in a lower [U.S.] shale break-even and absorb the unexpected return of around 300-400 [kilobarrels a day] of Libyan and Nigerian oil,” they said in the report.

Forget about oil rising above $50 this summer, Barclays says - MarketWatch

Big oil firms would face increased credit rating downgrade pressures if crude prices stayed below $50 a barrel on average until the end of 2018 and they did not compensate by cutting costs, S&P Global said on Wednesday. S&P currently has downgrade warnings - or negative outlooks in rating agency parlance - on ExxonMobil XOM.n, Chevron Corp (CVX.N) and Total (TOTF.PA), while the other so-called 'majors' include Royal Dutch Shell (RDSa.L) and BP (BP.L).

Oil majors face downgrades if crude prices don't pick up: S&P

The UK has taken the offensive in its battle to win the world’s largest public offering from New York by proposing a new listing for state-owned companies that would loosen governance restrictions on Saudi Aramco if to chose London for its mooted $2tn flotation. Britain’s Financial Conduct Authority said on Thursday it was planning to create a new category within its “premium” listing rules that would exempt companies controlled by governments from some rules that apply to oligarchs or other private groups.

London reforms set to open door for Saudi Aramco listing

EIA’s review of first-quarter 2017 financial results for 54 publicly traded U.S. oil and gas producers indicates that these companies, in aggregate, are paying off debt while funding investment through the sale of assets and the issuance of equity. In recent years, investment had been more heavily funded through the issuance of debt. Although revenue for these companies has grown over the past year with higher oil prices, net cash from operations has grown more slowly because of increased upstream costs.

This Week In Petroleum Summary Printer-Friendly Version

RE: OPEC, for some quiet moments.. - admin - 07-16-2017

Goldman Sachs's Brian Singer and his team are out with an update on exploration and production companies Thursday, writing that it's not quite yet time to buy the sector in general yet. Singer writes that E&P stocks are at 80 cents per dollar invested, after adjusting for changes in long-term corporate returns. In the last two cycles, these stocks bottomed around 70 cents, or an average of 18% downside to equities at the moment. Therefore, he advises investors that do want to buy in to either have a  constructive commodity or stock-specific outlook."

Goldman Sachs’ Eight E&P Picks For Low Oil Prices - Barron's

While observers may note that the market should be left to re-balance itself, a look at fundamentals suggest that approach may not be feasible or sufficient. Therefore, according to Rex Preston Stoner, an energy consultant with U.S.-based HUB International, “joint action by the OPEC/NOPEC producers may remain necessary for the medium term, if not the long term, if crude is to avoid another price crash. Whether such collective action may hold is the ‘million dollar question’”

Are Deeper Cuts OPEC’s Only Option? |

The world’s biggest oil producers are starting to take electric vehicles seriously as a long-term threat. OPEC quintupled its forecast for sales of plug-in EVs, and oil producers from Exxon Mobil Corp. to BP Plc also revised up their outlooks in the past year, according to a study by Bloomberg New Energy Finance released on Friday. The London-based researcher expects those cars to reduce oil demand 8 million barrels by 2040, more than the current combined production of Iran and Iraq.

Big Oil Just Woke Up to Threat of Rising Electric Car Demand - Bloomberg

ExxonMobil and its peers risk blowing $2.3 trillion on oil projects that will not be needed if the world hits peak demand in the next decade. A new report from The Carbon Tracker Initiative analyzed what would happen if the oil market saw demand peak by 2025, a scenario that would be compatible with limiting global warming to just 2 degrees Celsius. The headline conclusion is that about one-third of the global oil industry’s potential spending – or about $2.3 trillion – would not be needed. In other words, the oil industry is on track to waste a massive pile of money if demand peaks in less than ten years.

Oil Industry To Waste Trillions As Peak Demand Looms |

RE: OPEC, for some quiet moments.. - admin - 07-17-2017

OPEC would hurt itself and help U.S. shale producers if it adopted deeper cuts, the former oil minister of Qatar warned. "It’s not beneficial for OPEC to deepen their cuts because prices will go up and shale oil producers and others will take OPEC’s market share," Abdullah al-Attiyah said in interview in Istanbul. “The problem is that there is someone waiting in the dark corner for OPEC -- it’s shale oil producers and whenever prices rise, they raise production.”

Deeper OPEC cuts would help shale, former Qatar minister warns

The Syrian army, backed by heavy Russian air strikes, seized a string of oil wells in southwest Raqqa province on Saturday, as retreating Islamic State militants battle to defend their remaining territory in the country. State-owned Ikhbariyah television quoted a military source as saying the army had taken control of Wahab, al Fahd, Dbaysan, al-Qseer, Abu al Qatat and Abu Qatash oil fields and several other villages in the desert area that lies in the southwest of Raqqa province.

Syrian army takes more oil fields from Islamic State in Raqqa and eastern desert

Oil prices edged higher on Friday and were on track for solid weekly gains following positive demand signals, production issues in Nigeria and a reported decline in stocks. Brent crude futures, the international benchmark for oil, were up 43 cents at $48.85/bbl at 1111 GMT. U.S. West Texas Intermediate (WTI) crude futures were at $46.45/bbl, up 37 cents.

Oil firm as signs of higher demand outweigh worries of excess

Bob Ravnaas raised a paddle in a Houston auction house to secure his first block of mineral rights 19 years ago, when oil prices were swooning below $20/bbl. A generation later, that same West Texas oilfield is still spinning off royalties, part of a mineral-rights empire amassed by Ravnaas that stretches across 20 states and delivers millions of dollars in cash payments. Kimbell Royalty Partners, where the former petroleum engineer is now chief executive officer, has stakes in 48,000 oil and natural-gas wells in some of the hottest U.S. shale patches. These days, it’s not alone.

Collecting cash from shale without spending on drilling

RE: OPEC, for some quiet moments.. - admin - 07-18-2017

Oil edged up to about $49/bbl on Monday after fewer drilling rigs were added in the United States last week, helping ease concerns that surging shale supplies will undermine OPEC-led production cuts. U.S. drillers added two oil rigs in the week to July 14, bringing the total to 765, Baker Hughes said on Friday. Rig additions over the past four weeks averaged five, the slowest pace of growth since November.

Oil edges up towards $49 amid U.S. drilling slowdown

According to a recent Wood Mackenzie report "A big year for FIDs: 2017 marks a turning point," the number of upstream projects reaching FID (final investment decision) in 2017 could double to 25 compared to only 12 last year. In the first half of the year, the industry has already witnessed 15 project sanctions, which equates to about 8 Bboe of reserves, mostly in brownfield projects. This is almost comparable to project sanctions in the whole of 2016, which saw 12 FIDs and 8.8 Bboe of reserves approved.

Global upstream FIDs on track to double in 2017, Wood Mac says

Three recently discovered major gas fields are expected to raise Egypt's natural gas output by 50% in 2018 and 100% in 2020, the petroleum ministry said. "The fields of Zohr, North Alexandria and Nooros are among the most important projects that will increase natural gas production ... and will contribute to (Egypt’s) natural gas self-sufficiency by the end of 2018," Petroleum Minister Tarek El Molla said in a statement, which set out the production forecasts.

Egypt sets sights on doubling natural gas output by 2020

Cyber-attacks are developing into formidable threats within the oil and gas industry, and according to a recent study by Deloitte, the industry may not be regarding these threats with the respect that they deserve.

Deloitte’s hacking report underscores cybersecurity threat to oil and gas companies