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Drillers Can’t Replace Lost Output as $100 Oil Inheritance Spent

(Bloomberg) Here’s Why This Is Only the Fourth Time Oil Has Tanked. For oil companies, the legacy of $100 crude is starting to run dry.

A wave of projects approved at the start of the decade, when oil traded near $100 a barrel, has bolstered output for many producers, keeping cash flowing even as prices plummeted. Now, that production boon is fading. In 2016, for the first time in years, drillers will add less oil from new fields than they lose to natural decline in old ones.

About 3 million barrels a day will come from new projects this year, compared with 3.3 million lost from established fields, according to Oslo-based Rystad Energy AS.

Posted On : Published By : aspo-usa
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Peak Oil Review – 21 Mar 2016

The price rally that has been on-going since mid-February continued last week with US futures closing Friday at $39.44 a barrel, up 2.4 percent for the week, and London futures closing at $41.20 up 2 percent. Last week the move came from a combination of what one analyst termed a “brilliant communications strategy” and other developments that normally lead to higher prices. The “brilliant communications strategy,” of course, is the meeting in April during which those countries that either cannot or do not want to increase oil production are supposed to agree not to increase their production. During the week, Moscow even hinted that Iran might join the group after it increases its oil output to 4 million b/d, a goal that might take many months or even years to reach. The producers now are scheduled to meet on 17 April in Qatar; the meeting is being heralded as the first agreement to limit global oil production in 15 years even though it is unlikely to have any real impact on oil production.

Posted On : Published By : Tom Whipple
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What Happened to Peak Oil?

(greentechmedia.com) Peak oil is the point at which global oil production peaks and can only go down. M. King Hubbert developed the theory of peak oil after observing this pattern in individual oil fields and then extrapolating these trends to the U.S., accurately predicting a peak in U.S. production by 1970.

But in the last few years, as U.S. oil production has dramatically ramped up, many peak oil believers have been left looking a bit silly.

Posted On : Published By : aspo-usa
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US rig count, at 476, is lowest in 67 years of record-keeping: Baker Hughes

(platts.com) The total US rig count, which on Friday stood at 476, is now at its lowest point ever in the 67-year history of the Baker Hughes numbers, according to data released by the oilfield service company.

That is down by four from last week and down from 1,069 working the same week in 2015 and a recent peak of 1,931 in late 2014. The previous low was 488 in April 1999, Baker Hughes records show.

Posted On : Published By : aspo-usa
NYMEX Futures 2015 Rallies & Declines 17 Jan 2016
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Another False Oil Price Rally: Crossing A Boundary

(artberman.com) The oil-price rally that began in mid-February will almost certainly collapse.

It is similar to the false March-June 2015 rally. In both cases, prices increased largely because of sentiment. As in the earlier rally, current storage volumes are too large and demand is too weak to sustain higher prices for long.

Posted On : Published By : aspo-usa
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Saudi Arabia’s Oil Chief Prepares for a World After Fossil Fuels

(Bloomberg) Even as it pumps near-record quantities of oil, Saudi Arabia is getting ready for a time when the world will no longer need its biggest export.

The world’s largest crude exporter is focusing on renewable-energy sources such as solar power in preparation for a post-oil global economy, Oil Minister Ali al-Naimi said at a conference in Berlin on Thursday.

Posted On : Published By : aspo-usa
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In Shift, Obama Won’t Open Southeast Atlantic Coast to Drilling

(NY Times) When the Obama administration unveiled a proposal in January 2015 to open the southeastern Atlantic coast to oil and gas drilling for the first time, environmental advocates were shocked and enraged — and the oil industry was delighted.

The emotions were the same, just on opposite sides of the energy-environmental divide, when the Interior Department announced Tuesday that the administration was yanking Atlantic drilling off the table. And almost everyone was shocked.

Posted On : Published By : aspo-usa
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Investors Increasingly Bullish on Energy Sector

(NY Times) It was one of the darkest periods of the oil market slump. The global economy was showing fresh signs of slowing, and crude prices were collapsing so steeply that virtually every well in America was unprofitable.

But when Diamondback Energy went out to raise $226 million worth of new stock that week in the middle of January, the oil and gas company found more buyers than it could accommodate. It had to nearly double the amount of shares it sold, to four million.

Posted On : Published By : aspo-usa
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If Oil Prices Have Hit Bottom, the Top May Not Be Too Far Away

(Bloomberg) The top of the oil market may be closer than you think.

With Brent futures having bounced back as high as $41 a barrel, the International Energy Agency sees “ light at the end of the tunnel ,” and Goldman Sachs Group Inc. is spotting “green shoots.” Even so, many analysts warn that, like the failed rally last year, this recovery will sputter once prices go high enough to keep U.S. crude flowing.

Posted On : Published By : aspo-usa