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OPEC, for some quiet moments..
#41
Shale oil firms in the U.S. will suffer in the next two years due to the dramatic fall in the price of the commodity, according to Dennis Gartman, the founder and editor of the Gartman Letter, who expects a further fall in prices in the near term. The commodities investor has turned slightly more bearish on oil since last week, telling CNBC Tuesday that "crude oil prices haven't seen their lows yet."

Gartman: Get ready for oil bankruptcies

He said the world may never see $100 a barrel oil again. The comments, from a man who is often described as the most influential figure in the energy industry, marked the first time that Mr Naimi has explained the strategy shift in detail.

Opec leader vows not to cut oil output even if price hits $20 - FT.com

Total SA may delay some spending on North Sea projects over the next two years, as well as possibly buying or selling assets in the area, after oil prices slumped.

Total may delay North Sea spending in next two years amid oil drop

But despite all the hype from Victoria, the cold, hard fact remains that none of developers of the dozen-odd projects have yet issued a final investment decision. Such a decision would open the floodgates of CAPEX-spending for the upstream production, pipeline infrastructure and liquefaction facilities of these giant developments. So what is holding things up? In short, buyers and sellers can’t agree on price.

Asian LNG buyers are pushing for a new pricing scheme. Is it to their own detriment? - Alberta Oil | Canada's leading source for oil and gas newsAlberta Oil | Canada's leading source for oil and gas news

The Chevron-Apache Kitimat LNG export project in British Columbia has the potential to capitalize on Canada’s vast natural gas resources, as well as the proximity of its western coast to Asian markets. But it is also up against competition from producing countries like Australia, where the buildout of LNG export infrastructure is already well underway, and the US, where existing LNG import terminals and gas pipelines provide a foundation of infrastructure upon which new LNG export plants can build at lower cost and in less time.

Can Kitimat Compete? « Breaking Energy - Energy industry news, analysis, and commentary

This chart from Wells Fargo Securities shows just how much each income group in the US will save over a year because of lower gas prices.

US Income Bracket Savings Cheaper Oil - Business Insider

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#42
Not really says Marin Katusa, author of “The Colder War,” and chief energy investment strategist at Casey Research. Katusa believes that falling oil prices will eventually give Russia the upper hand and deeply injure the U.S. energy industry. The falling ruble makes Russian oil less expensive and more desirable to other countries—Russia also produces oil quite cheaply while the American shale industry has a larger cost of operation. Russia is more than able to weather the current storm, Katusa says. “They have a $200 billion a year trade surplus. They have over $400 billion in reserve currency. They’ve increased their gold reserve. They have much lower debt to their GDP than America. So yes there’s pain in the economy… [but] it's far from terminal.”

Putin is winning the oil war: Katusa - Yahoo Finance

Shares of retailers that cater to low-income consumers, along with airlines, will get the biggest boost over the next 12 months from the collapse in oil prices, according to a sweeping report from Morgan Stanley research.

Oil winners: Bet on stocks catering to low-income consumers

As Taylor Consulting, Inc. (TAYO) continues to scout and acquire real estate near Texas’ Cline Shale, the latest estimates for the formation predict that the formation could soon spawn the biggest oil and gas boom in U.S. history. Although the Cline formation is smaller in area than Texas’ other primary shale plays—Barnett and Eagle Ford—its hydrocarbons are denser, potentially containing an incredible 3.6 million barrels of recoverable oil per square mile. That gives the Cline Shale an estimated 30 billion recoverable barrels, making it 50 percent larger than the nation’s top two shale plays, Eagle Ford and North Dakota’s Bakken, combined.

Texas shale could spawn biggest oil and gas boom in U.S. history

Alaska Gov. Bill Walker has signed an agreement with a Japanese energy company formally declaring a commitment to form a partnership in developing Alaska's liquefied natural gas market. Walker called the action taken Tuesday with Resources Energy Inc. an important first step for the state's energy future. Under the previous administration, the state and Japanese agencies agreed to keep the lines of communication open over a proposed mega-LNG project.

Walker signs liquefied natural gas agreement with Japanese company

When it comes to global oil markets, the one thing that everyone agrees on is that it’s complex. The recent plunge in oil prices has many of us searching for explanations: Why has the price of oil dropped from over $100 a barrel to $55 a barrel in less than a year? What are the geopolitical and economic implications of this drop? And what impact will these suddenly low prices have on other energy industries, both carbon-based and renewable? This week on Sea Change Radio, the first half of our two-part discussion with renowned energy market analyst Daniel Dicker. Author, former oil trader and frequent TV commentator, Dicker tries to help us make sense of these slippery oil market fluctuations.

Plunging Oil Prices: Dan Dicker Part I

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#43

A must read from the IMF:

Oil prices have plunged recently, affecting everyone: producers, exporters, governments, and consumers.  Overall, we see this as a shot in the arm for the global economy. Bearing in mind that our simulations do not represent a forecast of the state of the global economy, we find a gain for world GDP between 0.3 and 0.7 percent in 2015, compared to a scenario without the drop in oil prices. There is however much more to this complex and evolving story. In this blog we examine the mechanics of the oil market now and in the future, the implications for various groups of countries as well as for financial stability, and how policymakers should address the impact on their economies.

Seven Questions About The Recent Oil Price Slump | iMFdirect - The IMF Blog

In 2014, LNG World News Staff conducted several interviews with major names from the liquefied natural gas industry.  As a part of the 2014 review series, we bring you the list of exclusive interviews on LNG World News.

2014 in review: LNG World News interviews | LNG World News

Gazprom Marketing & Trading Singapore has signed a four-year LNG sale and purchase agreement with Pacific Rubiales Energy.

Gazprom M&T, Pacific Rubiales sign LNG SPA | LNG World News

Oil and gas giant Chevron has filed an application with the U.S. Department of Energy to export previously imported LNG from the Sabine Pass terminal in Cameron Parish, Louisiana.

Chevron seeks licence to re-export LNG from Sabine Pass | LNG World News

Cue Energy Resources Limited (CUE and the Company) announced  the sale of its interests in Papua New Guinea to the National Petroleum Company of PNG for $7 million.

RIGZONE - Cue Completes Sale of Assets in PNG to National Petroleum Co. for $7M

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#44
The U.S. shale-oil industry has made another enemy: Europe’s largest crude explorers. Standard & Poor’s Ratings Services revised its outlook to negative for Royal Dutch Shell, Total and BP as the oil-market rout driven by weakening demand and a flood of supply from American shale fields threatens cash flow into 2016.

European Oil titans are latest victims of shale as prices sink

Saudi Arabia’s 2015 budget is probably assuming an oil price of $80/bbl, and will be seen as a sign of confidence in the market, according to a former economic adviser to the country’s government.

Saudi budget assuming $80 oil seen sign of confidence in market

Exxon Mobil and Gas y Petróleo del Neuquén have made a second unconventional oil and gas discovery in Neuquén Province of Argentina. Located in the liquids-rich area of the Vaca Muerta play, the La Invernada X-3 well was drilled to a total measured depth of 15,374 ft. The horizontal leg of the well extends for 3,280 ft. The discovery is operated by ExxonMobil Exploration Argentina S.R.L., an affiliate of Exxon Mobil. The well was drilled on the La Invernada Block in Neuquén Province and flowed at an average rate of 448 bopd and 1.0 MMcfgd on a 12/64 inch choke in its first flow test.

Exxon makes second discovery in Argentina’s Vaca Muerta

Offshore oil-drilling contractors, who last year were able to charge record rates for their vessels, are now under pressure to scrap old rigs at an unprecedented pace. The recent five-year low in oil prices is threatening an industry already grappling with a flood of new vessels and weakening demand. More than 200 new rigs are scheduled to be delivered in the next six years. That’s a 25% jump from the number currently under contract.

Oil drillers under pressure to scrap rigs to cope with downturn

Brent crude will rebound to $90 to $100/bbl within 12 to 18 months, according to entrepreneur T. Boone Pickens. The highest U.S. output in at least three decades is contributing to a glut that Qatar has estimated at 2 MMbopd. Brent, the international benchmark, closed at $61.69 on the ICE Futures Europe exchange. Pickens, speaking on CNBC’s Squawk Box, identified lower demand as a key factor that is often being overlooked amid the downturn in prices. "The demand for the world was another 1.3 million this year, and half of that is what we got," Pickens, the founder and CEO at BP Capital, said.

Pickens: Brent will be at $90 to $100/bbl in 12-18 months

The topic du jour is crude oil. As I write this article, West Texas Intermediate oil prices are $75/bbl, Brent is below $80/bbl, and the collective energy business is holding its breath after OPEC failed to cut production quotas during its Nov. 27 meeting. We have not had to worry about a cut since 2009, and OPEC watchers are coming out of the woodwork. The reality, unless you have Saudi oil minister Al-Naimi’s cell phone number, you are just another member of the OPEC guessing club.

December 2014 - Thoughts on oil and gas prices

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#45
RJ distributed an analysis. Basicly:
Brent ~80 WTI ~70 after the dust clears. N. America does the brunt of the production cutting.
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#46

'Putncalls' pid='53665' datel Wrote:RJ distributed an analysis. Basicly: Brent ~80 WTI ~70 after the dust clears. N. America does the brunt of the production cutting.

So OPEC wins by forcing most of the cuts on others, but at a fairly heavy price to their own budgets.

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#47
Saudis win by keeping their market share. They have the lowest cost oil and the response from a capitalist nation like the US is predictable. OPEC remains a wild card though.
https://www.dropbox.com/s/82sogv9zyuw0q1...4.pdf?dl=0
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#48
So, with that, I think that the ideal level for the bulls might be about 10% lower. That's because it's still worth drilling on the good properties at $50 while others are on hold and the marginal producers slowly get taken down. Again, remember, it's the speed not the price, and at $50 we get gasoline at about $2, which seems to have an almost miraculous effect on the consumer without causing massive bankruptcies and a destruction of the high-yield market.

Ideal Level for Oil?; Heed the Rotation: Jim Cramer's Best Blogs - TheStreet

Admiration for Putin's decisiveness has largely subsided in the West, but not totally. There are still people arguing Russia will come out the other end reinforced. While low oil prices will also produce problems in the US shale sector, it's strange to close one's eyes to the problems these cause in Russia's energy sector. The fall in the ruble could, long-time provide a boost to non-energy production and exports from Russia, but not without serious reforms. And Russia first has to survive a rather acute crisis. Only if oil recovers and Russia embarks on reforms would it be a good place to invest.

Is Putin Winning The Oil War? | Seeking Alpha

Oil prices fell Friday, tumbling as the dollar strengthened and a supply glut in top consumer the US trumped worries about falling production from Libya.

Oil down on rising dollar -Upstreamonline.com

BP is close to spending up to $800 million to acquire a stake in a Russian oil field that would further cement its already significant relationship with state giant Rosneft, according to a report. The UK supermajor is looking to tie up a 20% stake in the Tass-Yuriakh field in East Siberia, Moscow-based daily Kommersant reported, citing unnamed sources.

BP ‘eyes $800m Rosneft deal’ -Upstreamonline.com

Perenco, Golar and state player SNH sign heads of agreement that could lead to output from early 2017

Cameroon inks FLNG deal -Upstreamonline.com

InterOil, like most oil and gas companies, suffered from the fall in oil price. But unless energy prices stay low for a decade or so, which we think is unlikely, there is little reason for that. The next year will be decisive for InterOil's LNG plans, most notably because of the recertification of its Elk/Antelope resource which underpins it. If that confirms earlier certification, a major hurdle will be taken, setting the company up for a virtuous cycle of discoveries and monetization of its unique acreage.

The Portable InterOil - InterOil Corporation (NYSE:IOC) | Seeking Alpha

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#49
U.S. crude rose more than $1 in early Asian trade on Monday, reversing a fall in the previous session as escalating clashes in Libya threatened oil exports and supply disruptions from the OPEC member.

U.S. oil climbs above $55 a barrel on renewed Libyan tensions. - Yahoo Finance

QCLNG is the world' s first LNG project to be supplied by coal seam gas. The start of production from the plant' s first LNG train is the result of more than four years of development and construction on Curtis Island. The project will expand further with the start-up of the second train in the third quarter of 2015. At plateau production, expected during 2016, QCLNG will have an output of around 8 million tonnes of LNG a year.

BG starts LNG shipments from $20 billion QCLNG project

Profitable drilling in Bakken for LTO extraction has been, is and will continue to be dependent on an oil price above a certain threshold, now about $68/Bbl at the wellhead (or around $80/Bbl [WTI]) on a point forward basis. (The profitability threshold depends on the individual well’s productivity and companies’ return requirements.) Complete analysis of developments to LTO extraction should encompass the resilience of the oil companies’ balance sheets and their return requirements.

FRACTIONAL FLOW | Fractional flow, the flow that shapes our future.

Alaska Gov. Bill Walker has signed an agreement with a Japanese energy company formally declaring a commitment to form a partnership in developing Alaska's liquefied natural gas market. Walker called the action taken Tuesday with Resources Energy Inc. an important first step for the state's energy future. Under the previous administration, the state and Japanese agencies agreed to keep the lines of communication open over a proposed mega-LNG project.

Walker signs liquefied natural gas agreement with Japanese company

In April 2012 I published this post about World Crude Oil Production and the Oil Price (in Norwegian) which was an attempt to describe the developments in the sources of crude oils (including condensates), tranches of total life cycle costs (that is [CAPEX {inclusive returns} + OPEX] per barrel  of oil) and something about the drivers for the formation of the oil price. Rereading the post and as time passed, I learnt more and therefore thought it appropriate to revisit and update the post as it in my opinion contains some topics from what I have observed, learned and discussed that have been given poor attention and appears poorly understood.

World Crude Oil Production and the Oil Price | FRACTIONAL FLOW

Driving an electric car confers a badge of greenery, or so the marketing departments of their makers would have you believe. Yet a report which analyses the life cycle of car emissions (ie, all the way from those created by the mining of materials for batteries, via the ones from the production of fuel and the generation of electricity, to the muck that actually comes out of the exhaust) presents a rather different picture.

Why Electric Cars May Be Much Dirtier Than Gas-Powered Ones - Business Insider

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#50
A price war is brewing between Canada and Latin America over who will satisfy U.S. Gulf Coast refiners’ hunger for heavy oil. The new Seaway Twin pipeline will almost double the amount of heavy Canadian crude coming to Gulf terminals and plants to about 400,000 bpd starting in January, according to ARC Financial. The shipments are growing even without the Keystone XL pipeline, which has been delayed for six years because of environmental opposition.

Canadian oil surge to U.S. Gulf puts Mexico on defensive: Energy

U.S. oil drillers, facing the lowest crude prices in five years and rising competition from suppliers abroad, reduced the number of rigs to an eight-month low. Rigs targeting oil declined by 37 to 1,499 in the week ended Dec. 26, Baker Hughes Inc. said on its website. The number of oil rigs has slipped by 76 in three weeks. Those drilling for natural gas increased by two to 340, the Houston-based field services company said. The total count, which includes one miscellaneous rig, dropped 35 to 1,840, also an eight-month low.

Rigs seeking oil in U.S. fall to 8-month low, Baker Hughes says

The oil price decline of 2014 upended the geopolitical chessboard. Worth watching in 2015 will be who can recover and dominate play -- OPEC, Vladimir Putin or U.S. shale drillers.

What’s next for OPEC, shale as lower oil prices extend into 2015

Oil affects countries around the world differently. Generally speaking, low prices are great for net importers of oil, but bad for net exporters. UBS's macro strategy team considered what a permanent $10 drop in a barrel of Brent crude would mean.

UBS: GDP Impact Of $10 Decline In Oil - Business Insider

A few weeks ago I offered some calculations suggesting that lower demand for oil might account for about $20/barrel of the dramatic decline in the price of oil since last summer. Here I point to some other evidence consistent with that conclusion. Last week the IMF’s Rabah Arezki and Olivier Blanchard produced a very useful assessment of the role of supply and demand in the recent oil price decline. They note for example that the IEA’s current estimate of world oil demand growth for 2014:Q3 is 800,000 barrels/day below what the organization had been anticipating as of last June.

Supply, demand and the price of oil | Econbrowser

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