OPEC, for some quiet moments..

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OPEC is widely expected to extend production cuts that initially boosted oil futures above $50, but prices just keep falling. That raises concerns that oil prices could struggle to return to their 2017 highs in the mid and upper $50s even if the Organization of the Petroleum Exporting Countries carries over the output reductions through the second half 2017 when it meets in three weeks. That announcement could boost prices by $2 or $3 a barrel, said John Kilduff, founding partner at energy hedge fund Again Capital. But that would leave a lot of ground to cover. Thursday's sell-off sent U.S. crude prices below $46 a barrel, while Brent futures slumped to under $49. Those levels have not seen since Nov. 30, when OPEC agreed to slash output by 1.2 million barrels a day in a bid to shrink huge stockpiles around the world.

Plunging oil prices show OPEC has lost its grip on the market

With the oil industry barely recovering from its most brutal slump in decades, you might expect the Arctic Ocean to be the last place explorers would hunt for new discoveries. The Barents Sea off Norway’s northern tip is different. Norwegian authorities expect companies including Lundin Petroleum AB and OMV AG to drill a record 15 wells in the Barents this year. Statoil ASA’s Songa Enabler, a floating drilling machine the size of two football fields, is in the vanguard of those efforts as it embarks on a five-well exploration campaign.

An unlikely Arctic oil boom has a lesson in progress for Trump

Crude rebounded from a six-week low on signs the U.S. supply glut is easing and as Russia signaled support for extending output cuts with OPEC. Futures rose as much as 1.2% in New York. U.S. crude stockpiles fell by 4.16 MMbbl last week, the American Petroleum Institute was said to report Tuesday. The API was also said to report that gasoline and distillate-fuel supplies slipped. The industry figures precede government data that will be released Wednesday, which is forecast to also show an inventory drop. Russia believes that its accord to cut production alongside OPEC and other producers should be extended, a Russian government official said.

Oil rises from six-week low as U.S. glut eases, Russia backs cuts

Saudi Arabia’s giant oil and gas reserves and any decisions about producing from them will remain solely in government hands after Saudi Aramco’s initial public offering, Deputy Crown Prince Mohammed bin Salman said on state television. The world’s largest oil exporter known formally as  Saudi Arabian Oil Co. holds a concession to pump the kingdom’s oil and gas, and a stake in that business is what the government will sell in an offering of “not far from 5%” of company shares in 2018, the prince said Tuesday in a TV interview. Analysts at Sanford C. Bernstein & Co. and Rystad Energy AS said in March that the IPO has a potential market value of more than $1 trillion.

Saudis to control crude reserves, output after Aramco IPO

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Royal Dutch Shell showed it has adapted to a world of lower oil prices, generating a surge in cash that allowed it to pay dividends while reducing debt. The Anglo-Dutch company’s first-quarter performance helps validate CEO Ben Van Beurden’s $54 billion purchase of BG Group -- for which some shareholders complained he overpaid -- and the deep spending cuts and asset sales he undertook to protect the balance sheet.

Shell pumps torrent of cash as BG takeover, cost cuts pay off

Oil dropped below $50/bbl in London for the first time since late March on growing signs that OPEC’s production cuts are failing to clear a surplus of crude. Brent futures lost as much as 2.2%. Crude output rose to 9.29 MMbpd, the highest level since August 2015, according to the Energy Information Administration. U.S. inventories fell less than all 11 forecasts by analysts surveyed by Bloomberg. OPEC is likely to extend production cuts for six months past June, according to Nigerian Oil Minister Emmanuel Ibe Kachikwu.

Brent crude falls below $50 in London for first time since March

Oil dropped to the lowest since late November on growing signs that OPEC’s production cuts are failing to clear a surplus of crude. Futures fell by about 4% on both sides of the Atlantic. U.S. crude output rose to 9.29 MMbpd last week, the highest level since August 2015, according to the Energy Information Administration. OPEC is likely to extend the 1.2 MMbpd cut agreed to in November for six months, according to Nigerian Oil Minister Emmanuel Ibe Kachikwu. Energy and metal futures declined Thursday on concerns over demand in China.

Crude tumbles to lowest since OPEC deal as cuts seen ineffective

While President Donald Trump’s plan to cut corporate income taxes could save oil and natural gas explorers $13 billion a year, it jeopardizes tax breaks that may mean even more to U.S. shale drillers. The proposal outlined Wednesday is a long way from the finish line and could change significantly in the coming months. One major question is whether Trump and the U.S. Congress balance lower tax rates by reducing other incentives, like a deduction for drilling expenses that may save companies $35 billion over the next decade, according to a report Thursday by analysts at Bloomberg Intelligence.

Drillers warned: 'Be careful what you wish for' with Trump's tax plan

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The international market has a message for American refiners: Stay calm and keep turning crude into diesel. While a global glut has pushed crude prices down to five-month lows, manufacturers of middle distillates can’t make enough to satisfy demand. A combination of seasonal events is giving refiners on both the Atlantic and Gulf coasts a chance to boost exports to Europe and South America.

The World Is Buying American Diesel as Fast as Refiners Can Make It - Bloomberg

As rapid growth in U.S. shale production grabs headlines and threatens to upend attempts by OPEC to balance oil markets, a more unsung sector of the U.S. industry is also hitting new output highs - the offshore Gulf of Mexico. While attention and investment is focused on shale, the Gulf is the among the most prolific oil source in the United States, producing more than Alaska, the West Coast and Rocky Mountains combined. The region churned out a record 1.76 million barrels per day of crude in January, trailing only Texas onshore production, which includes the growing Permian Basin.

Little fanfare, but Gulf of Mexico oil still growing steadily | Reuters

Argentina’s Vaca Muerta, one of the largest shale formations outside of North America, offers tons of promise for the country’s energy future. Just don’t hold your breath waiting for it. Energy Minister Juan Jose Aranguren, billionaire investor Paolo Rocca and bullish Morgan Stanley economists all predict lightning fast growth in the region, comparing it to the Eagle Ford and Permian basins in the U.S., oil and natural gas-saturated plays that have spurred billions in revenue.

Argentina's push to mimic Permian success faces long road ahead

Total SA will spend $500 million over three to four years to develop a shale gas field in Argentina as the country’s government lures investors by pledging a minimum price. “We have giant resources of non-conventional gas under our feet in Argentina,” Chief Executive Officer Patrick Pouyanne told reporters at a conference in Paris on Thursday. “It’s the beginning of a nice story.”

Total to invest $500 million to produce shale gas in Argentina

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Oil prices gave up earlier gains on Tuesday, as concerns over slowing demand and a relentless rise in U.S. crude output undermined the impact of hopes that OPEC-led production cuts could be extended. Brent crude futures, the international benchmark for oil prices, were at $49.37 per barrel at 0252 GMT on Tuesday, down from a high of $49.60 earlier in the day and near their last close. U.S. West Texas Intermediate (WTI) crude oil futures were trading at $46.46 per barrel, down from an intra-day high of $46.66 and also little changed from their last settlement.

Oil gives up earlier gains as rising US output, China concerns weigh | Reuters

From Exxon Mobil Corp. to Total SA, the world’s largest listed oil companies have sent a message to skeptical investors and rivals at OPEC: we can get by in a world of $50/bbl crude. Oil majors generated a gusher of cash in the first quarter. The surge shows how a mix of cost-cutting and assets sales -- plus the tailwind of new output from projects approved several years ago -- helped companies to survive and then thrive with prices that are less than half what they were a few years ago.

Oil majors going strong in a $50/bbl market

By the time Midwesterners fire up their furnaces this fall, the $2-billion Nexus pipeline is supposed to be pumping natural gas to heat homes from frosty Ohio to frostier Ontario. But six months out, the 255-mi (410-km) pipeline exists only on paper.  Until President Donald Trump fills key vacancies at an energy regulator, Nexus and other sprawling energy projects are in limbo, unable to secure permits to begin construction. For Nexus developers DTE Energy Co. and Spectra Energy Partners LP, each week that passes threatens the project’s ability to meet winter demands.

Trump delay stalls $50 billion of energy investment projects

OPEC’s plan to boost oil prices by cutting production has fizzled, yet it has little choice but to stick with it. Crude has surrendered all of its gains since the OPEC first agreed production cuts in November. While the group has implemented the curbs, a rebound in U.S. shale output and stubbornly-high stockpiles show the world’s three-year crude glut isn’t shifting. Even signals from Saudi Arabia and Russia that they’ll prolong the supply reductions haven’t staunched the rout.

OPEC runs out of options as bid to boost oil price fizzles

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U.S. shale oil producers have largely been portrayed as the nemesis of the Organization of the Petroleum Exporting Countries, but the cartel should actually be welcoming the ramp-up in production stateside, according to Goldman Sachs’s top commodities analyst. After the initial slump in production following the 2014 oil crash, U.S. producers have slimmed down and are now competitive at prices in some cases below $30 a barrel. That’s lower than for many other oil producers, putting the U.S. and OPEC in a joint sweet spot to squeeze out other competitors in the current oil-price environment, said Jeffrey Currie, global head of commodities research at the firm.

U.S. shale oil boom is actually ‘OPEC’s friend,’ says Goldman’s Currie - MarketWatch

Oil’s slump to a five-month low is driven purely by technical trading and supply is still getting tighter, according to Citigroup Inc. and Goldman Sachs Group Inc. “The market is really fundamentally tightening up,” Citigroup’s Head of Commodities Research Ed Morse said in a Bloomberg television interview on Friday. “It’s never possible to call a bottom, but I suspect this is a great buying opportunity” before a big jump in prices by the end of the year, he said.

Oil is a buy for Citigroup as Goldman says market getting tight

U.S. shale explorers are boosting drilling budgets 10 times faster than the rest of the world to harvest fields that register fat profits even with the recent drop in oil prices. Flush with cash from a short-lived OPEC-led crude rally, North American drillers plan to lift their 2017 outlays by 32 percent to $84 billion, compared with just 3 percent for international projects, according to analysts at Barclays Plc. Much of the increase in spending is flowing into the Permian Basin, a sprawling, mile-thick accumulation of crude beneath Texas and New Mexico, where producers have been reaping double-digit returns even with oil commanding less than half what it did in 2014.

Shale Drillers Are Outspending the World With $84 Billion Spree - Bloomberg

OPEC and its allies are seeking to pump less for longer in a quest for higher prices. The world’s biggest independent oil trader says their efforts could be in vain. Demand isn’t expanding as much as expected, and U.S. shale output is growing faster than forecast, according to Vitol Group. That’s increasing the burden on the world’s biggest producers, who need to stick to their pledges to cut supply just to keep prices from falling, said  Kho Hui Meng, the head of the company’s Asian arm.

Top oil trader warns that OPEC efforts could be futile

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OPEC and other oil producers taking part in output cuts have reached a consensus to extend the limits until the end of the year, oil ministers for two of the group’s members said. All members of OPEC support an extension of the cuts for a second six-month period, as do non-member nations that joined last year’s accord to curtail a global oversupply of crude, Iraq’s Jabbar Al-Luaibi and Algeria’s Noureddine Boutarfa said Thursday in a joint news conference in Baghdad.

OPEC producers reach consensus to extend cuts

Abu Dhabi National Energy Co. is considering boosting investments in existing oil and natural gas assets that may increase production from Canada to Iraq after posting its first quarterly profit since 2015. The shares climbed the most in five weeks. “We are planning to spend $500 million into capex, and that’s going to be across the assets,” Chairman Saeed Mubarak Al-Hajeri said in a Bloomberg television interview from Abu Dhabi. “The goal is to sustain production at a level where we are or higher.”

Taqa to boost investment, as shares soar on profit

OPEC boosted estimates for growth in rival supplies by 64% as the U.S. oil industry’s recovery accelerates, threatening the group’s attempts to clear a surplus. Production from outside OPEC will increase by 950,000 bpd this year, OPEC said in a report, revising its forecast up by about 370,000. The projection is four times higher than in November, when the group announced a production cut to try and re-balance oversupplied world markets. Non-OPEC nations pump about 60% of the world’s oil.

OPEC raises 2017 estimate for supply growth from rivals by 64%

Forget the climate warriors of California. The state best positioned to spoil Donald Trump’s plan to unleash America’s fossil-fuel resources may be New York. In the past year, New York regulators have blocked two major natural gas pipelines -- a $455-million proposal by National Fuel Gas Co. and a $925-million one from Williams Partners LP -- on the grounds that they pose environmental risks. One bank’s saying investors have no choice but to assign “elevated risk premiums” to energy projects in the state, National Fuel Gas is threatening to take its money elsewhere and Williams’s CEO said Wednesday that he’s in talks with the White House on how the administration can help.

New York threatens to spoil Trump's push for fossil fuels

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U.S. crude production forecasts keep growing. The Energy Information Administration said domestic output will climb to a record 9.96 MMbpd in 2018, up from 9.9 MMbbl projected last month, according to the agency’s monthly Short-Term Energy Outlook released Tuesday. Production will average 9.31 MMbpd in 2017, up from 9.22 million projected in April.

U.S. oil ouput seen rising to record in 2018, as shale booms

Oil was steady before government data forecast to show U.S. crude stockpiles fell for a fifth week, further reducing an inventory surplus. Futures were little changed in New York, having recovered 6.3% since slumping to a five-month low on May 5. Stockpiles probably dropped by 2 MMbbl last week, according to a Bloomberg survey before EIA data Wednesday. In addition to the potential extension of the OPEC agreement into 2018, some ministers have also discussed the possibility of deepening their output cuts, said four delegates.

Oil prices steady as U.S. stockpiles drop again

As crude oil production in the Permian basin of western Texas and eastern New Mexico has increased, pipeline infrastructure has also increased to deliver this crude oil to demand centers on the U.S. Gulf Coast. One indicator of a potential shortfall in available takeaway capacity in the Permian is a negative spread between the price of West Texas Intermediate (WTI) crude oil at Midland, Texas, and the price of WTI at Cushing, Oklahoma.

New pipeline infrastructure to accommodate rise in Permian oil production: EIA

Petrobras is entering the fourth expansion cycle in its history as it ramps up its production in the pre-salt layer. This is a major milestone for the company, achieved by overcoming challenges, developing technologies and building up technical capacity. This was explained on May 3, by Petrobras’ exploration and production director, Solange Guedes, during a panel discussion entitled “Oil and Gas in Brazil: Rules of the Game,” at a parallel event to the Offshore Technology Conference (OTC) held by the Brazil-Texas Chamber of Commerce (BRATECC). She noted that Petrobras’ own output in the pre-salt reached 1 MMbpd, one year before expected. In December 2016, oil and gas production in pre-salt fields operated by the company amounted to 1.6 MMbpd, up 45% from December 2015.

Petrobras enters its fourth expansion cycle, credits pre-salt

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The world’s two biggest oil exporters seem to have finally figured out how to eliminate a global surplus that’s kept crude prices in check for almost three years. Saudi Arabia and Russia said in Beijing on Monday they favor prolonging this year’s oil curbs to the first quarter of 2018. If they convince fellow producers to adopt the strategy when OPEC and its partners meet next week, it will pare near-record inventories in developed nations by 8 percent and erase the glut weighing on the market, according to Bloomberg calculations using U.S. government data. “They have a very clear goal,” said Mike Wittner, head of oil market research at Societe Generale SA in New York. “They remain focused on having stocks get down to the five-year average. They really want to see it work.”

OPEC Prolonging Cut Would Accomplish Mission to Clear Oil Glut - Bloomberg

When Khalid Al-Falih arrived at Davos in late January, the Saudi oil minister was exultant. The output cuts he’d painstakingly arranged with fellow OPEC states and Russia were working so well, he said, they could probably be phased out by June. Almost five months later, U.S. production is rising faster than anyone predicted and his plan has been shredded. In a series of phone calls and WhatsApp messages late last week, Al-Falih told his fellow ministers more was needed, according to people briefed on the talks, asking not to be named because the conversations are private.

In fight against U.S. shale oil, OPEC risks lower for longer

Oil bulls, take heart! U.S. drillers have dramatically reduced their hedging activity, a move that could portend a break in the production gains that have upended global crude prices. The relative cost of options protecting against a drop in West Texas Intermediate  crude has fallen to its lowest since August, thanks to a big drop in producer hedging, Societe Generale SA said on Friday. The so-called put skew for contracts delivered a year from now -- weighing the difference in value between bullish and bearish options -- fell to just below 6 percentage points, after rising above 8 points in February.

U.S. shale's favorite financial trick is getting less attractive

Last night’s announcement of the 100-day action plan between the U.S. and China has the potential to alter global LNG trade, opening the door of the world’s largest LNG growth market to the world’s fastest-growing LNG supplier. Under the action plan, which falls under the framework of the U.S.-China Comprehensive Economic Dialogue, Chinese companies can now negotiate long-term contracts to source liquefied natural gas from U.S. suppliers, the U.S. Commerce Department said.

Wood Mac: U.S.-China agreement connects fastest-growing LNG supplier with largest LNG market

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Oil jumped to its highest level in more than two weeks after the Saudi Arabian and Russian energy ministers said they are in favor of extending a production-cut deal for nine months. Futures added as much as 3.6% in New York. While output curbs that started Jan. 1 are working, global inventories aren’t yet at the level targeted by OPEC and its allies, Saudi Energy Minister Khalid Al-Falih said in Beijing alongside his Russian counterpart, Alexander Novak. The ministers agreed the deal should be extended through the first quarter of 2018 at the same volume of reductions, they said.

Oil jumps as Saudis, Russia favor extending output deal to 2018

The International Energy Agency will review its electric vehicle (EV) use and oil demand forecasts after India and China recently signaled new policies in favor of electric cars and vehicles using other alternatives to gasoline. In its current policies scenario, last updated in November 2016, the IEA expects vehicle demand for oil to rise until 2040. But after the world's two fastest growing oil markets, China and India, indicated they are likely to take radical turns away from gasoline, the IEA says it will need to review its forecasts. "We will therefore revisit our analysis of future EV market penetration on the basis of these new announcements for the next World Energy Outlook 2017, to be released on 14 November,” an IEA spokesman told Reuters.

Exclusive: IEA to review oil demand outlook after China, India signal auto policy shifts | Reuters

The oil and gas industry is facing a challenging year. Oil prices remain volatile, and uncertainty remains about whether prices will recover from around $50/bbl. Across the upstream sector, companies are considering their next investments, while weighing up how to remain profitable in the current climate. To gauge the state of the sector, Wood Mackenzie asked its client base to share their thoughts on a number of key themes, including: What are the expectations around the oil price? Will investment in M&A and capital spend rise? What is the industry's priority for 2017? What is the best long-term growth option?

Wood Mackenzie survey indicates upstream players grappling with uncertainty

Santos has announced further positive results from the Muruk-1 exploration well, being drilled in the Papua New Guinea Highlands. Following the successful gas discovery at Muruk-1, announced in December 2016, an additional sidetrack (Muruk 1ST3) has been successfully drilled through the Toro reservoir objective to the southwest of the Muruk-1 gas discovery.

Santos announces positive results from Muruk-1 exploration well in Papua New Guinea

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Saudi Aramco plans to sign agreements with at least 10 companies including General Electric Co. and oil field-service businesses Schlumberger Ltd. and  Halliburton Co. when President Donald Trump visits Saudi Arabia, according to two people familiar with the matter. The world’s biggest crude oil exporter plans to sign accords also with  Baker Hughes Inc., KBR Inc., Jacobs Engineering Group Inc., Nabors Industries Ltd., Weatherford International Plc, McDermott International Inc. and Rowan Companies Plc, said the people, who asked not to be identified because they are not authorized to speak to media. The deals will be signed on May 20 during Trump’s first foreign trip as president.

Aramco said to plan at least 10 energy deals during Trump visit

Kuwait joined Saudi Arabia and Russia in supporting an extension of oil-output cuts by OPEC and other global producers through the first quarter of 2018 to help trim global stockpiles. An extension of the cuts at already agreed-upon volumes is needed to reach the goal of paring world inventories to their five-year average, Kuwait’s Oil Minister Issam Almarzooq said Tuesday in an emailed statement.

Kuwait joins Saudi Arabia, Russia to seek oil cuts into 2018

The oil field’s digital transformation is bringing sweeping change to the upstream industry, from using data analysis to help companies find the oil, to the possibility of operating equipment autonomously. These technological inventions will bring significant structural changes—similar to how those wrought by the advent of horizontal drilling and hydraulic fracturing changed the industry, reducing the cost of production in North America drastically.

Exxon Mobil’s Halsey: Oil patch’s digital transformation will be comparable to horizontal drilling’s tech revolution

Crude markets are getting some encouragement from the U.S. as supplies fell for a sixth week -- a sign that OPEC-led production curbs are starting to be felt in the world’s biggest oil-consuming nation. Inventories fell 1.75 MMbbl last week to 520.8 million, the Energy Information Administration reported Wednesday -- less than the 2.67 MMbbl decline forecast by analysts surveyed by Bloomberg. Russia and Saudi Arabia said on Monday that they’re in favor of extending output cuts for nine months to give global stockpiles more time to reach the level targeted by OPEC and its allies.

Oil rises as U.S. supply decline signals OPEC's making progress