Shell Starts Production At New FPSO In Pre-Salt Brazilian Field

Royal Dutch Shell’s Brazilian subsidiary BG E&P Brasil and partners began production in a deepwater field in the Santos Basin on Friday, according to a new report by World Oil. The floating production storage and offloading vessel (FPSO) P-66 sits at a depth of 2,150 meters and can extract 150,000 barrels of oil and six million cubic meters of natural gas per day. The vessel is the first in a series commissioned by Petrobras to exploit the BM-S-11 block within a consortium. “Achieving production at Lula South is an important accomplishment…

1.2 Million BPD Capline Pipeline Could Be Retired by 2021

New pipelines with similar routes may drive Plains All American LP’s Capline pipeline, from Louisiana-to-Illinois, obsolete, according to a new report by Reuters. The 1.2-million-barrel-per-day pipeline, was once the nation’s largest, but a bank report from the company’s latest investor presentation shows steep drops in volume over the past few years as competing facilities siphon off the line’s demand. Capline will be “idled as redundant pipeline capacity,” which also transfers crude supplies from Cushing, Oklahoma,…

The Top 10 Nations Exporting Oil To The U.S.

U.S. has brought crude oil from 80 nations into its refineries In the past 30 years, the U.S. has imported more than 91 billion barrels of oil, drawing from a large variety of sources. The EIA began carefully tracking American oil imports in 1986, meaning there is now a significant amount of historical data. From 1986 to 2016 the U.S. imported 91.2 billion barrels of crude oil, in just under 244,000 individual records. In total, the EIA lists 80 different countries from which the U.S. has imported crude oil. The top ten countries are listed below…

Saudi Arabia To Trim Oil Exports To US To Force Inventories Lower

Riyadh plans to purposely reduce exports to the United States to force a reduction in the latter’s sizeable inventories, which are preventing a greater rise in global oil prices, according to Saudi Oil Minister Khalid Al-Falih. Just one day after OPEC announced a nine-month extension to its November production cut deal, the top oil official told reporters on Friday that “exports to the U.S. will drop measurably.” Two sources close to the matter told Bloomberg that starting next month, Saudi crude supplies to American importers…

The Big Data Revolution In Oil Is Accelerating

It was about time big data entered the lives of Big Oil. Yet it’s not happening exactly as expected. Oil companies are not making a mad dash to collect and process unstructured data in order to make sense of it and use it to expand or improve their business. No, it’s individuals and startups that are leveraging the potential of these unstructured data to supply it in a structured and useful way to oil traders. The oil industry is notoriously opaque, especially those parts of it that are grouped in the Organization of Petroleum Exporting…

Texas Shows No Sign Of Slowing Production Growth

(Click to enlarge)The Chart above compares several different combinations of past (vintage) data to estimate output. The dotted line is based on the most recent 8 months (August 2016 to March 2017) of data saved from the RRC website, the blue solid line is based on the past 12 months of data, and the yellow line is based on the most recent 3 months of data. Each estimate uses the most recent 24 months of data from each month. A significant change in the size of the correction factors began in August 2016, which is the basis of the 8 month Corrected…

Uzbekistan To Increase Its Refining Capacity By 50%

Uzbekistan revealed in late April that it had begun building a new $2.2 billion oil refinery that would produce fuel for sale domestically and abroad. Official news sources stated perfunctorily that oil supply agreements had already been reached with Kazakhstan and Russia, although the finer details still in fact need to be decided. The ambition is formidable. The refinery being built in the Jizzakh province, which lies adjacent to the South Kazakhstan Region, is being designed to process up to 5 million tons of oil annually, an almost 50 percent…

It’s Not Over For OPEC Just Yet

OPEC extended production cuts that were originally agreed in December 2016 for another 9 months, delivering both OPEC members and Russian discipline that will last well into the Spring of 2018. And still the Saudis and OPEC continue to get no respect at all, like Rodney Dangerfield. The oil markets, in fact, after a two-week boom in prices, used the actual date of the meeting to retreat from their highs, ending the day below $50 a barrel. This could be a reaction to the very late speculative players trying to take advantage of a decision that was…

The Reaction To The OPEC Deal Extension Is Logical, But Flawed

Those new to financial markets, and energy trading in particular, were probably somewhat puzzled by the price action in oil futures this week following the announcement by OPEC and some influential non-OPEC nations that they are extending the production cuts agreed last year for another nine months, until the end of Q1 2018. The logical reaction to that news would have been a spike in oil, but instead we saw a dramatic decline of around five percent once the announcement was made. That is easily explained in terms of trading dynamics, but one question…

The OPEC Elixir Wasn’t Potent Enough

Friday May 26, 2016 In the latest edition of the Numbers Report, we’ll take a look at some of the most interesting figures put out this week in the energy sector. Each week we’ll dig into some data and provide a bit of explanation on what drives the numbers. Let’s take a look. 1. Oil market unimpressed with OPEC extension (Click to enlarge) – OPEC extended their cuts for another nine months, and put on a display of unity both amongst each other and with non-OPEC countries like Russia. – However, because OPEC has routinely tried…

Global Energy Advisory May 26th 2017

The biggest oil news of the week was certainly the OPEC announcement of an extension of the crude oil production cuts until March 2018. This additional 9-month lifeline is – according to the Saudi Energy Minister – “the safe bet that should do the trick” of rebalancing the market. It also gives another 9-month ‘reprieve’ to U.S. shale as well. The initial November agreement has failed to restore global market balance. There were doubts over the past month as to whether the extension would happen, but more and more OPEC members…

Expect Choppy Oil Markets As Markets Digest OPEC’s Decision

July Natural Gas Weekly Recap Natural gas prices continued this week’s price slide on Thursday after U.S. government data showed that natural gas supplies in storage rose more than expected last week. According to the U.S. Energy Information Administration, natural gas storage rose by 75 billion cubic feet in the week-ended May 19. This was slightly above the pre-report forecast for a build of 71 Bcf. Last week’s report showed a build of 68 Bcf. The EIA also said that natural gas in storage currently stands at 2.444 trillion cubic feet.…

Goldman: OPEC Needs To Do More To Restrain Shale Oil

Goldman Sachs analysts have warned that OPEC’s job is not over with the announcement of an extension to its November agreement. Now the group needs to convince markets that even with the cut, U.S. shale output growth can maintain the global glut, with a view to curbing capital inflows into shale production. “OPEC needs to create a credible threat that the oil market may return into surplus to finally slow the capital inflows into shale. This could be achieved by both expressing the goal of growing future production, and gradually ramping…

Naive Hedge Funds Bet Too Big On An OPEC Cut

It seems that hedge funds and money managers had built up too big a bullish position before the OPEC deal, send oil prices down when the 9-month extension was announced. Friday, May 26, 2017 (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge)OPEC and non-OPEC members secured a nine-month extension of their deal, pushing the combined 1.8 million barrels per day in reductions through to the first quarter of 2018. The cohesion among the disparate members was notable,…

China Teapot Refiners Overflow, Slow Crude Oil Imports

Chinese independent refiners, the so-called ‘teapots’, are expected to import less crude at least until August, as high inventories, changing import quota policies, and stricter tax scrutiny are squeezing their refining margins—a move that could raise concerns over China’s oil demand growth. Some independent refiners are pausing for maintenance, while others are cutting run rates because of squeezed margins, Reuters reported on Friday, citing managers at teapots. “There will be more shutdowns in June, July and…

Analysts Say Oil Industry Needs $45 Oil Price To Break Even

Technological advances and deflationary pressure from the downturn have resulted in an 8-percent drop in global average unit production cost to US$30 per barrel of oil equivalent in 2016, which implies that the industry needs the price of oil at US$45 to break even in aggregate, according to a Bernstein Research survey of the 50 biggest listed global oil and gas companies. Global marginal cost, that is, the cost to replace reserves, for non-OPEC oil producers dropped by 12 percent annually to US$63 per barrel in 2016, according to the survey,…

Falling OPEC Exports Create Upside For Oil Prices

No sooner had the dust settled after the conclusion of the latest OPEC meeting (with oil traders selling the market like hot cakes), we got Saudi oil minister Khalid Al-Falih saying that exports to the US were dropping measurably. While this has caused a good degree of excitement in the market, we here at the good ship ClipperData had already highlighted at the beginning of this month that Saudi Arabia had slashed export loadings in April, which would translate into lower deliveries to key demand hubs into June. (Also discussed here on CNBC…

Unstoppable: U.S. Adds Oil, Gas Rigs As OPEC Extends Deal

The number of active oil and gas rigs in the United States rose for the nineteenth straight week, Baker Hughes reported on Friday by 7, signaling that the US Shale patch is, for OPEC, an unstoppable force. The number of oil rigs in operation increased by 2, and gas rigs increased by 5. Combined, the total oil and gas rig count in the US now stands at 908 rigs, or 504 above the count a year ago. This is on top of drilled but uncompleted wells in the US, which are also on the rise, swelling from 5,534 in March 2017 to 5,721 in April 2017, according…

Iran Sees $50B Oil Deals Enter Operational Phases In 2018

Iran expects around US$50 billion worth of oil contracts to launch their operational phases next year, according to Fardad Daliri, director of investment at the Industrial Development and Renovation Organization (IDRO) of Iran. The Islamic Republic is inviting local and foreign companies to take part in oilfield development projects that Iran wants to launch soon, Daliri said at an international exhibition in Tehran, as reported by Trend news agency. “We are hopeful to be able to sign huge oil deals on the development of shared oil fields…

What Is Behind The Surge Of Russian Oil Exports To India?

In the first five months of 2017, Indian companies have purchased more than 1 million tons of Russian crude supplied from Black Sea ports. In and of itself, there would be nothing extraordinary about it, were it not for the almost complete lack of supplies before 2017. India already surpassed its average Urals imports twentyfold (the past few years’ annual import volumes lingered around a mere 50ktpa) and is on course to increase the ratio higher still. On one hand, Indian companies that acquired minor stakes in Rosneft’s Siberian assets…

Oil Crashes To $48 Handle As Iran Says It Won’t Cut Output

Iran’s current crude oil output level will not be reduced under the extension of the OPEC production cuts, Iranian Oil Minister Bijan Zanganeh was quoted as saying on Thursday. “Iran’s oil output would stand at 3.8 mb/d,” Zanganeh said in Vienna – as quoted by Trend news agency – where OPEC meets to discuss the details of the output cut extension. OPEC agreed to extend the current cuts for nine months until March 2018 in what was a widely expected decision that sent oil prices plunging as investors hoped for more.…

Texas Claims Victory As OPEC Forced To Roll Over Oil Production Cuts

“Texas shale producers forced OPEC this morning to extend its oil production cuts for 9 months,” Texas Railroad Commissioner Ryan Sitton said on Twitter on Thursday, shortly after OPEC agreed to extend the oil production cuts for nine months until March 2018. On Wednesday, Sitton said that “OPEC meets tomorrow and is expected to cut oil production again thanks to the resiliency of Texas shale drillers.” “Less OPEC oil on the market enhances the opportunity for American energy to fill needs around the world,…

Unveiled: Venezuela, Syria’s Secret Scheme To Bypass Oil Sanctions

A Bloomberg investigation has uncovered a plan by Venezuela and Syria to circumvent Western sanctions on the Middle Eastern nation and ship its crude oil to Aruba to refine it and then market it internationally, including in the U.S. The plan, Ben Bartenstein writes, was never actually realized, but it involved selling Syrian oil to Venezuela at a substantial discount, and then shipping it through a Russian shale company to Aruba, which houses one of the world’s largest refineries, property of Valero Energy and leased to Venezuela’s…

Equatorial Guinea Joins OPEC

Equatorial Guinea has become the 14th member of OPEC on the day the cartel announced a nine-month extension of its November 2016 crude oil production cut. The addition, as reported to Reuters by a source from Guinea’s oil ministry, makes the country the sixth oil producer in Africa to join the organization. Equatorial Guinea, which is currently the third-largest oil producer in Africa, said back in January that it was looking to join OPEC, which would boost the continent’s overall influence on international oil markets. The country…

Is This Top 10 Mining Destination Turning Negative For Investment?

Australia’s southern state of Victoria took a big step to support mining exploration this week. Handing out A$1.2 million in grants to support exploration and development at five projects across the region. But in one of Australia’s most critical mining regions, things look less positive. With the local government making several moves that could render projects here more difficult. That’s the state of Queensland. Which is currently ranked by the Fraser Institute as a top-ten destination for mining investment worldwide. Queensland’s…

Oil Prices Slip On OPEC Deal Disappointment

As OPEC’s latest meeting concludes in Vienna, just a glimpse at the charts below helps explain why the cartel’s production cut deal has been extended for another nine months: it hasn’t worked so far. For all the talk of near-perfect compliance from OPEC, we have consistently highlighted how the cartel has kept global markets well-supplied, as apparent production cuts have not been reflected through to broad-based and consistently lower exports. We discussed last week how U.S. oil imports from OPEC were holding up. Deliveries to the U.S. in May…

Libya Insists On Keeping Oil Output Cut Exemption

Libya has insisted that it remains exempt from the oil output reduction deal that OPEC today decided to extend by another nine months, to March 2018. According to Libya’s ambassador to Austria, who represented the country at the cartel’s meeting, it is still producing less than half of its “original production quota.” Libya, along with Nigeria and Iran, was exempted from the original agreement, struck in November 2016, as its oil production was affected by factors other than the global glut that sank prices in 2014.…

Kuwait Favors OPEC Production Cut Extension For A Whole Year

Kuwait wants the OPEC deal extension to span a whole year,, as opposed to six months or nine, according to comments by the nation’s oil minister at the bloc’s headquarters in Vienna, Austria. Either the extension lasts 12 months or the cuts deepen to 1.8 million barrels per day, minister Essam al-Marzouq added, just ahead of OPEC’s official quarterly meeting on Friday. All options “should be on the table,” al-Marzouq told the International Business Times when asked to specify the preferred option for Kuwait. Both avenues…

Iraq Considers Massive Oil Hedge Akin To Mexico’s

Top Iraqi oil marketer Falah Al Amri suggested that Iraq is interested in creating an oil price hedging program that would lock in prices for future trades well in advance—just like Mexico’s existing strategy, but almost twice as large in size. “We will not rush. This is a long process,” SOMO chief Al Amri said. “We must make sure we do not lose money. You know the Iraqi parliament, it would not accept that.” Iraq is still in the early stages of exploring the possibility, the official said, adding that the proposal…

Nigerian Oil Production To Reach 2.2 Million Bpd By June

The CEO of Nigerian oil company Oando says the worst of the west African country’s output disruptions are over as the twice-attacked Forcados pipeline returns to full capacity by the end of June. National production will touch 2.2 million barrels per day by June as well, Pade Durotoye told reporters at the Africa Independents Forum in London on Wednesday. “We think that the worst is behind us,” he said. “Before the end of June, we will have Forcados back, which would take us comfortably back to 2.2 million bpd.” The first cargo from…

Renewables Jobs To Double By 2030

The number of people working in the renewable energy industry globally could rise to 24 million by 2030, compared to 9.8 million in 2016, the International Renewable Energy Agency (IRENA) said on Wednesday in its annual review 2017. “As the scales continue to tip in favour of renewables, we expect that the number of people working in the renewables sector could reach 24 million by 2030, more than offsetting fossil-fuel job losses and becoming a major economic driver around the world,” IRENA Director-General Adnan Z. Amin said in…

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