Weekly Review

“While Exxon invested $12.5 billion on international upstream capital expenditures (CAPEX) to produce 1.7 million barrels a day of total liquid oil production in 2018, it spent a staggering $7.7 billion in US upstream CAPEX to supply only 551,000 b/d of oil. Thus, Exxon spent nearly double the amount of CAPEX for each barrel of US oil production versus its international oil supply… ExxonMobil’s US oil and gas sector is heading toward a financial disaster. It’s US oil and gas CAPEX spending will choke the living hell out of its profits. While some may think I am fermenting hype, the financial results shown above point to a pretty clear trend… and it ain’t good. If one of the world’s largest oil companies can’t make money producing US shale, then what does that say for the rest of the industry?”

Steve St. Angelo, independent precious metals and energy researcher

“Washington doesn’t like cartels like OPEC. But then how can you have one market [the oil trade] dominated by one currency – the dollar?”

Participant at an EU industrial working group convened to promote the euro and fight the monopoly of the US dollar in oil and commodities trading (2/14)

“[W]ith President Trump’s poll numbers in negative territory, whichever candidate emerges from the Democratic primary will have a decent shot at winning the presidency. If that occurs, they will be on record having supported the Green New Deal and will most likely push for some version of it in 2021. That means that oil and gas companies, having enjoyed a deregulatory bonanza under Trump, could see rougher waters ahead. But with the climate debate getting momentum, that pressure is not going away, no matter what happens with the Green New Deal.”

Nick Cunningham, Oilprice.com

“Because energy can be generated by technologies, using the sun and wind, rather than concentrated natural resources in the form of oil and gas, which is not ubiquitous in geographic terms, many countries will be able to reduce their vulnerabilities to price spikes and outright supply disruptions by pivoting to renewable energy. Moreover, the strategic importance of chokepoints – the Straits of Hormuz, or the Straits of Malacca for instance – will diminish as fossil fuels lose their grip.”

Global Commission on the Geopolitics of Energy Transformation

“The fracking industry has helped set new records for US oil production while continuing to lose huge amounts of money — and that was before the recent crash in oil prices. But plenty of people in the industry and media make it sound like a much different, and more profitable, story… The explanation is pretty simple: Shale companies are not counting many of their operating expenses in the “break-even” calculations. Convenient for them, but highly misleading about the economics of fracking because factoring in the costs of running one of these companies often leads those so-called profits from the black and into the red.”

Justin Mikulka, DeSmog Blog (1/19)

“Global automakers are planning an unprecedented level of spending to develop and procure batteries and electric vehicles over the next five to 10 years, with a significant portion of their budgets targeted at China… Automakers’ plans to spend at least $300 billion on EVs are driven largely by environmental concerns and government policy, and supported by rapid technological advances that have improved battery cost, range and charging time.”

Paul Lienert and Christine Chan, Reuters

“Shale companies have attracted huge amounts of capital from Wall Street over the past decade. So far, investors have largely lost money. Since 2008, an index of US oil and gas companies has fallen 43%, while the S&P 500 index has more than doubled in that time, including dividends. The 29 companies in the Journal’s analysis have spent $112 billion more in cash than they generated from operations in the last 10 years, according to data from FactSet, a financial-information firm.”

Bradley Olson, Rebecca Elliott and Christopher M. Matthews, The Wall Street Journal (1/2/19)

“Some geologists harbor doubts about ANWR’s prospective resources. ‘I don’t see (in the refuge’s geology) what I hear in the political talk,’ about the refuge’s potential, said Richard Garrard, an Alaskan-based exploration geologist. said. Geologically, the region is an extension of the Brooks Range, which is to the south. ‘How many oil fields have been discovered in the Brooks Range? None.’”

From S&P Global Platts

[about proposed seismic testing off the east US coast] “Almost every single one of those states is pretty adamant about not wanting that activity off their shore. The administration is pushing through the industry agenda on expanded oil and gas leasing despite all evidence that other stakeholders have other viewpoints about the appropriateness and the scope of that activity.”

Elizabeth Klein, deputy director, State Energy and Environmental Impact Center, NYU School of Law

“Last week’s meeting reminded us that the Big Three of oil – Russia, Saudi Arabia, and the United States – whose total liquids production now comprises about 40 percent of the global total, are the dominant players.”

International Energy Agency (12/14)

“As a matter of our policy, we want to end all of those subsidies [for electric vehicles]. And by the way, other subsidies that were imposed during the Obama administration, we are ending, whether it’s for renewables and so forth…It’s just all going to end in the near future. I don’t know whether it will end in 2020 or 2021.”

Larry Kudlow, White House economic advisor

“Total US oil reserves in 2017 exceeded a … 47-year-old record, highlighting the importance of crude oil development in shales and low permeability plays, mainly in the Southwest.”

US EIA

“In my 36 years in this [petroleum] business, I have never seen such a wide differential in sentiment between Canada and the US. I’ve never seen more frustration among our customers and our competitors and in our peer-group companies than right now.”

Kevin Neveu, chief executive officer of the oilfield-service company Precision Drilling Corp.

“The assumption that current and future climate conditions will resemble the recent past is no longer valid…With continued growth in [greenhouse gas] emissions at historic rates, annual losses in some economic sectors are projected to reach hundreds of billions of dollars by the end of the century – more than the current gross domestic product (GDP) of many US states,”

The Fourth National Climate Assessment Volume II, compiled through combined efforts of 13 US government agencies