Mature ‘super basin’ in US breaks 44-year oil record

A mature ‘super basin’ located in Texas and New Mexico has set a new oil-production record, beating its previous peak set in 1973. The Permian Basin has reached a new production volume of at least 815 million barrels in 2017, far exceeding its previous peak of 790 million barrels, according to new analysis from information […]

All That New Shale Oil May Not Be Enough as Big Discoveries Drop

Three years after causing an oil-price crash, the shale boom may not be enough to meet rising global demand because the industry has cut back so sharply on higher-risk mega-projects. Discoveries of new reserves this year were the fewest on record and replaced just 11 percent of what was produced, according to a Dec. 21 […]

The Biggest Factors In Future Oil Production

The views expressed in this post are those of the author alone. This assessment is based on the data in the 2017 BP Statistical Review of World Energy available here. As such it uses that review’s definition of oil which is crude and condensate and natural gas liquids, uncompensated for their different energy contents or values […]

The Dark Bounty of Texas Oil

For more than a century, the economic fortunes of Texas have depended on oil. The image of mighty geysers spewing depreciable assets out of the ground is forever linked to the state. In the popular imagination, a rich Texan is invariably an oil baron. The Austin Chalk, the Barnett Shale, the Wolfcamp: these layers of […]

The Bakken Strikes Back

Summary October production data for the Bakken validates operators’ claims of strong early-time well performance in the play’s core. Current prices provide a powerful growth stimulus not yet reflected in the volumes. Continental Resources has advertised 15-month payouts for its wells in the Bakken Core in a $50 per barrel WTI environment, which implies exceptional […]

Is Aramco Shopping For US Shale?

Saudi Aramco has held early talks to buy a stake in a U.S. company and has inquired about potentially acquiring assets in the two biggest U.S. oil and gas shale basins, the Permian and the Eagle Ford, The Wall Street Journal reported on Wednesday, citing people familiar with the matter. While the Saudi state-held oil […]

Sanctions-Proof Oil Rig Thwarts US Policy From Cuba to Russia

The oil rig was built mostly in China and drilled its first well in Cuba. Now it’s delivering a victory for Russia in its fight against U.S. sanctions. Italian oil giant Eni SpA and Russia’s state-controlled Rosneft PJSC are using the Scarabeo 9 ultra-deepwater rig to drill in water more than 2,000 meters (6,600 feet) […]

Lies, Bad Lies And Natural Gas Statistics

Summary Emotions running high after recent pricing volatility. Future production fundamentals leaning strong bearish. Wait for big trader “Elephant Tracks” before wading into the pool. Emotions are running high for natural gas traders after the fireworks of the past six weeks. I’m currently on the sidelines, and, while I’m long term bearish, nothing goes up […]

Twilight years: is the UK entering its last decade of oil and gas production?

Controversial research by the University of Edinburgh suggests UK oil and gas industries are entering the last decade of production. Julian Turner talks to the author of the report, Prof. Roy Thompson, about resource depletion, hard data vs industry optimism, and the transition to the clean economy. The Edinburgh Geological Society was formed in 1834 […]

World Oil Supply Hits Year High, Boosted by U.S. Shale Surge

Shale producers are roaring back to life, pushing the global oil supply to its highest level in a year and undermining OPEC’s efforts to rebalance the market through production cuts, the International Energy Agency said Thursday. In its closely watched monthly oil market report, the IEA said the amount of crude oil on the global […]

After 2.5 Billion Barrels, Eagle Ford Has More Oil Coming

Mark Twain would appreciate irony in the Eagle Ford Shale, where rumors of the play’s impending exhaustion are greatly exaggerated. The Eagle Ford has produced 2.5 billion barrels (Bbbl) of oil and will generate another 2.1 Bbbl, according to Allen Gilmer, CEO of DrillingInfo, the Austin-based Big Data repository of all things oil and gas. […]

Saudi Arabia and Russia reach compromise on oil

Ministers from OPEC and their allies have agreed to extend their production pact all the way to the end of 2018 but with a review in June that will take into account market conditions and progress toward rebalancing. The outcome represents a successful compromise between de facto OPEC leader Saudi Arabia (which wanted to announce […]

OPEC Agrees To Extend Oil Supply Cuts Until End Of 2018

Update : maybe not so fast on the champagne, because according to Reuters, the Bloomberg leaker may have jumped the gun: OPEC YET TO DECIDE ON OUTPUT CUT EXTENSION, TALKS CONTINUING – DELEGATE: RTRS. * * * With OPEC delegates sequestered in a Vienna conference room, as they negotiate the proposed 6-9 month production cut […]

So Much Natural Gas—But Where to Put It?

fotosuper/Thinkstock Press spacebar to see more share options. In the nineties, a bumper sticker with the words “happiness is multiple pipelines” could be seen slapped on cars from Houston to Washington, D.C., to Baku, Azerbaijan. Though that slogan referred to the effort to build other pipelines that bypass Russia to move oil out of the […]

The Shocking Outlook For US Oil Production

Last week the International Energy Agency (IEA) released its World Energy Outlook 2017. The report identified four large-scale shifts underway in the global energy system: The rapid deployment and falling costs of clean energy technologies The growing electrification of energy The shift to a more services-oriented economy and a cleaner energy mix in China The […]

It’s Never Wise to Bet Against a Saudi Oil Minister

Don’t be fooled by the apparent dithering of OPEC and friends over whether to extend their output restraint when they meet at the end of the month. They know full well that failing to send a clear signal would send oil prices plummeting. The apparent backsliding from Russia and a small number of OPEC members […]

The IEA Is Grossly Overestimating Shale Growth

This week, the IEA said that U.S. shale would dominate the oil and gas markets over the next decade, rising to “a level 50 percent higher than any other country has ever managed.” With a “remarkable ability to unlock new resources cost-effectively,” U.S. shale will add millions of barrels of new oil supply by 2025. […]

Can Russia Break Its Oil Dependence?

Despite improving oil prices, Russia’s economic growth is slowing, with GDP rise for the third quarter at 1.8 percent on an annual basis, versus 2.5 percent for the second quarter, Russia’s state statistical bureau, Rosstat, said earlier this week. Analysts say it’s the latest indication that Russia’s economy needs major reforms. Let’s state the obvious: […]

OPEC October Production Data

All data below is based on the latest OPEC Monthly Oil Market Report. All data is through October 2017 and is in thousand barrels per day. I have now included Equatorial Guneia although I only have data from January 2015 from OPEC’s secondary sources. The January 2015 E. Guneia data was extended back to January 2005. I […]

Dan Yergin on why Venezuela could cause a ‘big shock’ to the markets

If the global oil market suddenly loses Venezuela’s 2 million barrels of daily oil production, it would be “a big shock to the system,” according to Dan Yergin, vice chairman of IHS Markit. “It would certainly be a very tight market, because of course you already have production restraints by OPEC and non-OPEC,” Yergin told […]

America’s oil and gas output could soar 25% by 2025

At the same time, the renewable energy sources will become more important. Despite the cautious sentiment, traders said oil prices were unlikely to fall far, largely due to supply restrictions led by the Organization of the Petroleum Exporting Countries and Russian Federation, which have helped reduce excess stockpiles. Solar power will surge globally in the […]

Tracking the declines in ISIS oil production

Oil has been a key revenue source for ISIS, yet new data shows that production has steadily declined in areas under the group’s control. Historically, it has been difficult to get an accurate measure of ISIS’s oil production. Past estimates extrapolated from chance observations at a small number of production sites — typically wherever journalists […]

What the Saudi Arrests Mean for the Kingdom’s Oil Policy

We may never fully know what lies behind Crown Prince Mohammed bin Salman’s decision to arrest more than 200 Saudi citizens, including 11 princes and four government ministers, on corruption charges, just as tensions with Iran are escalating. What we do know is that his move simultaneously boosted the oil price and undermined the attractiveness of Aramco to […]

Is Peak Permian Only 3 Years Away?

The world’s hottest shale basin, the Permian, is leading the second U.S. wave of tight oil production growth and will continue to do so for years to come, all analysts say.    However, signs have started to emerge that the relentless intensification of drilling leads to diminishing returns, Simon Flowers, Chairman and Chief Analyst at […]

Global Majors Eyeing Mexico’s Deep Waters

As the price of oil rises, an international rush is on for Mexico’s untapped deep-water riches. The who’s who of the oil world — led by Exxon Mobil Corp and Royal Dutch Shell Plc, the world’s two biggest drillers by market value — are lining up to bid in the country’s Jan. 31 deep-water auction. And […]

What happens when the drilling is done?

A seismic shift It seems like we’ve been talking about “peak oil” for a long time, but the meaning has shifted radically in the last few years. Historically the phrase referred to the hypothetical point in time when the world’s oil production would hit its maximum. It became famous in the 1970s, when we feared […]

Are Oil Markets Immune To US Shale?

Oil prices pulled back slightly following the release of the Baker Hughes rig count report, but geopolitical risk still remains, and with the assumption that OPEC will extend its production cut deal, oil bulls are very much alive and well. (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) (Click to enlarge) […]

Norway’s Oil Sector Faces Existential Crisis

Exploration activity in the North Sea – the most mature area of Western Europe’s biggest oil producer – is at an 11-year low this year, which is a concern for the industry’s regulator, the Norwegian Petroleum Directorate (NPD). “That worries me,” NPD Director General Bente Nyland told Bloomberg in a recent interview, voicing the industry […]

The US Over-Supply Of Oil Is Ending

Shutterstock The U.S. over-supply of oil is ending. Comparative inventory (C.I.) has been dramatically reduced in 2017. Levels have fallen 159 mmb since February and are now approaching the 5-year average for the first time in nearly 3 years (Figure 1). Figure 1. The U.S. Over-Supply of Oil is Ending. Source: EIA and Labyrinth Consulting […]

Russia Oil Market Overview

Russia is the world’s largest producer of crude oil (including lease condensate) and the second-largest producer of dry natural gas. Russia also produces significant amounts of coal. Russia’s economy is highly dependent on its hydrocarbons, and oil and natural gas revenues account for more than one-third of the federal budget revenues. Russia is a major […]

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