Americas, Asia do what OPEC wouldn’t: cut oil production

Wildfires in Canada. Instability in Venezuela. Stalling U.S. frackers. Drops in oil output are happening so fast that it looks as if the Americas alone could resolve global oversupply. The 70 percent oil price slide LCOc1 CLc1 between 2014 and early 2016 has been pegged to one problem: production exceeding demand by as much as […]

Hydraulically Fractured Wells Provide Two-Thirds of U.S. Natural Gas Production

Source: U.S. Energy Information Administration, based on IHS Global Insight and DrillingInfo Inc. For decades, hydraulic fracturing had been referred to as an unconventional completion technique, but over the past 10 years it has become the technique by which most natural gas is produced in the United States. Based on the most recent data from […]

Michael Lynch: Saudi Oil Confounds The Skeptics

Friend and colleague Rob Bradley came across a 5-year old article denouncing me for my foolishness is not believing in peak oil theory and especially “refuting” a New York Times piece I had written. My piece was in response to revelations from Wikileaks that mentioned a former Saudi Aramco official who raised questions about that […]

North Dakota Official Exalts Oil Boom “Is Coming Back With A Rush”

Great News!! As OilJobFinder.com reports, North Dakota’s top oil regulator sent out a message the other day to the leaders of Williston: Get Ready. “This is going to come back pretty hard and pretty rapidly,” Helms said told members of Williston’s Chamber of Commerce. “And we’ll be back running to stay ahead of it.” You […]

Peak Fracking, Perpetually Higher Oil Prices

Summary Peak Fracking occurred in June 2015 with production falling 672,000 barrels per day; by March 2017 decrease will exceed the 1973 Oil Embargo. Rig counts dropped from 1840 in December 2014 to 420 in April 2016. Fracking wells deplete quickly. Without 1840 active drilling rigs, fracking production will deplete quickly. Fracking companies are $200 […]

Brexit: What could it mean for the North Sea’s oil?

In less than two months UK citizens will make one of their biggest political decisions in more than 40 years: whether to remain or leave the EU trading bloc they have been part of since 1973. While an exit from the EU could mark a major milestone for the UK economy — the government fears […]

Gulf of Mexico Deepwater Overview

Quest Offshore assesses the drilling, subsea, and marine construction dynamics affecting of one of the world’s pre-eminent deepwater basins amid the downturn. The Gulf of Mexico has long been a region of critical importance to the global deepwater industry, both from the perspective of activity levels as well as the complex nature of executed projects […]

Michael Lynch Defeats the Mainstream

“Since at least 1989, Mr. Lynch has made a career of poo-pooing any concept that oil supplies might be finite and that we might find production capability dropping as demand continues to rise…. [Oil supply] not an issue?  Do you expect to be dead and gone in the next 4 to 8 years?” – Charles Armentrout, […]

The Rise and Deadly Fall of Islamic State’s Oil Tycoon

Islamic State oil man Abu Sayyaf was riding high a year ago. With little industry experience, he had built a network of traders and wholesalers of Syrian oil that at one point helped triple energy revenues for his terrorist bosses. His days carried challenges familiar to all oil executives—increasing production, improving client relations and dodging directives from […]

Crude power: The oil game uncovered

In an attempt to tackle the global oil crisis, OPEC and non-OPEC oil producers held an extraordinary oil summit in Doha, Qatar’s capital, last week. With the oil price still low and the market heavily oversupplied, 20 oil and energy ministers were trying to find a consensus on a way forward. But they failed to do […]

New York Denies Critical Permit for Natural Gas Pipeline

New York environmental regulators have rejected a critical permit needed for a major natural gas pipeline project, saying the project fails to meet standards that protect hundreds of streams, wetlands and other water resources in its path. The Department of Environmental Conservation said Friday it won’t issue a water quality permit for the 124-mile Constitution […]

Oil Megaprojects Dreamed Up A Decade Ago Thrive Amid Price Slump

Oil production in some of the riskiest, highest-cost regions of North America is still thriving, even as the worst slump in a generation takes a bite out of U.S. shale. Onshore U.S. output is poised to drop 22 percent from last year through 2017, according to the Energy Information Administration. However, new volumes coming on […]

OPEC Update

All charts are updated through March 2016 The latest OPEC Monthly Oil Market Report is out out. The charts are “Crude Only” production and do not reflect condensate production. Also the charts, except for Libya, are not zero based. I chose to amplify the change rather than the total. OPEC is now 13 nations with the […]

Iran’s Dilemma: Too Much Oil And Not Enough Ships

Late last week, just ahead of the Doha meeting, we reported that Iran’s existing oil tanker armada, which until recently had been on anchor next to the Iranian coast and which according to Windward data was storing as much as 50 million barrels offshore, had finally started to move. The reason, as Bloomberg reported, was […]

US 2015 Oil Production and Future Oil Prices

Oil production can be confusing because there are various “pieces” that may or may not be included. In this analysis, I look at oil production of the United States broadly (including crude oil, natural gas plant liquids, and biofuels), because this is the way oil consumption is defined. I also provide some thoughts regarding the direction […]

What really happens if Saudi Arabia starts pumping more oil?

A month ago, I wrote about “why OPEC will never cut production again.” This weekend we saw Saudi Arabia put an exclamation point on the matter by scuttling a deal in Doha for an oil production freeze. The repurcussions of this decision will obviously be far reaching. Stating that “if we don’t freeze, then we […]

Draft Doha agreement would freeze output until October

A spike in tensions between arch-rivals Saudi Arabia and Iran appeared on Sunday to ruin prospects of the first binding oil output deal in 15 years between OPEC and non-OPEC nations, and looked set to prompt another fall in the price of crude. Some 18 OPEC and non-OPEC oil producers, including Russia, had been meant […]

Saudi Prince Says He Could Add a Million Barrels Immediately

Saudi Arabia could raise crude production by more than a million barrels a day immediately, said the kingdom’s Deputy Crown Prince, as he reiterated the nation would only agree to freeze production if all major producers including Iran do the same. Mohammed Bin Salman Source: Saudi Arabia’s Royal Court The world’s largest oil exporter could increase […]

Iran’s oil production has already surpassed 3.5 million bpd

Iran’s oil production has already surpassed 3.5 million barrels per day, the deputy oil minister said on Saturday, and the Islamic Republic is seeking to increase oil and gas exports in the coming month. “Iran’s crude oil exports will increase to 2 million barrels per day in the coming month … Gas condensate exports would […]

Bakken Update – April 2016, Little Decline So Far

North Dakota data from the NDIC is out. Bakken Three/Forks data shown in chart above (NDIC Data) with a Red Queen Model (based on Rune Likvern’s original work) using data gathered from the NDIC by Enno Peters to develop well profiles. The model uses an estimate of the well profiles based on the NDIC well […]

Huge Oil Supertanker Lines Forming “World’s Biggest Traffic Jam”

      “It may be the world’s biggest traffic jam.” – Reuters Last week we revealed what we thought was a “shocking photo” of nearly 30 oil tankers caught in a traffic jam off the Iraqi coast, an indication of just how much excess oil is currently parked offshore.   To be sure, the record offshore […]

US shale oil peak in 2015

The latest EIA drilling productivity report (11th April 2016) https://www.eia.gov/petroleum/drilling/ shows US shale oil production continuing to decline in Bakken, Eagle Ford and Niobrara while the Permian has flattened out. The Eagle Ford graph (Fig 1) shows that monthly declines in existing wells overwhelm production from new wells by a factor of 2.5 The resulting peak in […]

Cursed by oil? Academic says production often leads to misery.

What do the migration crisis, ISIS-led terrorism in Europe and Russia’s alignment with Syria’s Assad government have in common? “All of those stories come from countries that export oil,” says Leif Wenar, author of “Blood Oil: Tyrants, Violence, and the Rules that Run the World.” “There is something about oil which is very dangerous to the people of […]

Natural Gas Production Is About To Plummet

Summary As one of the seven largest natural gas producing regions in the U.S., the Eagle Ford is a significant area to understand for natural gas-oriented investors. In this article, I dig into the government’s data regarding production and forecast what output should look like by year-end. What I discovered is that, if something doesn’t […]

Iran and Oil: You Ain’t Seen Nothing Yet

“Freeze” is a word rarely heard in balmy Doha, but it will be the talk of the town this week. That isn’t because a delegation from frigid Moscow plans an unusual appearance at a meeting of oil exporters being held in Qatar’s capital next Sunday. The star of the show, and quite possibly the spoiler, will […]

Saudi Oil Gambit Moves to Phase Two

There’s an oil supply crunch looming and Saudi Arabia and its local allies are positioning themselves to take advantage. In what would be the second phase of the kingdom’s strategy to defend its market share against rival producers (most visibly U.S. shale), Gulf states are planning to raise output capacity to fill the hole left by the lack of investment in […]

US Shale Oil Production Costs Fell by 30% from Decade High

Costs associated with shale oil exploration and production decreased by a third in 2015 thanks to implementation of more effective technologies. Experts are certain that this could affect crude oil prices in the short term. Costs beared by US shale producers shrunk by 25-30% last year in comparison to their decade high in 2012. This […]

How the Prophet of Peak Oil Explained Fracking in the 1950s

The following is excerpted from The Oracle of Oil: A Maverick Geologist’s Quest for a Sustainable Future, by Mason Inman. Copyright © April 11, 2016. W .W. Norton & Co. Adapted from Chapter 17, “A Magical Effect.” Author’s Note: In the mid-1950s, M. King Hubbert was the first to explain correctly how a new technique […]

Why is Africa’s largest oil producer short of petrol?

Despite being one of the world’s biggest oil producers, Nigeria imports most of its fuel and is currently facing a severe shortage. It does not have enough oil refineries and even if the four it has were running at full capacity, they would only supply a quarter of the country’s needs, says John Ashbourne, an […]

Nearly 30 Oil Tankers in Traffic Jam Off Iraqi Coast

Oil tankers are caught in a traffic jam near the Iraqi port of Basra, causing delays in loading. According to Reuters, around 30 very large crude carriers (VLCCs) are sitting in the Persian Gulf, and the backlog could cost ship owners more than $75,000 per day. Some could be waiting for weeks to reach the […]

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