Don’t expect an oil sands resurrection

Just a few years ago, Alberta’s oil sands were the great hope for Canada’s economic future. A 2013 report from the National Energy Board projected that oil sands production would more than double from about two million barrels a day in 2010 to five million by 2035. Projections from the Canadian Association of Petroleum Producers […]

International Rig Count Still Falling

The Baker Hughes International Rig Count is out. The rig count data in all charts below is through February 2016. The Baker Hughes International Rig Count does not include the US, Canada, any of the FSU countries or inland China. It does include offshore China. That rig count peaked in July 2014 at 1,382 rigs […]

Russia Thinks It Has Solved the Oil-Price Crisis

But it may just be more wishful thinking The world’s major oil exporting economies have been putting together an agreement to freeze oil production levels, and Russia’s energy minister is optimistic that it will be effective in finally stopping the slide in oil prices that has brought the price of oil down roughly 75% since […]

US Shale’s Message For OPEC: Above $40, We Are Coming Back

For leading U.S. shale oil producers, $40 is the new $70. Less than a year ago major shale firms were saying they needed oil above $60 a barrel to produce more; now some say they will settle for far less in deciding whether to crank up output after the worst oil price crash in a […]

Falling U.S. Oil Production Reduces Global Supply

High oil price volatility signals that the market has not yet decided the future direction of the oil price. Global production was marginally lower in January, but outside of the U.S., oil production remains robust with rises registered in most producing areas. Production in Iran has begun to rise with 80,000 bpd added in January. […]

How Oil Is Burning a Hole in Asia

Arab states’ petrodollars are burning fast and that’s bad news for emerging markets, real estate and, above all, Asian securities. Gulf Cooperation Council countries have to refinance $94 billion of debt over the next two years, as reported by Bloomberg News on Sunday. As the price of oil drops, so do the foreign-exchange reserves of those nation’s central […]

Peak oil in the South China Sea

The recent deployment of missile launchers and jet fighters on Woody Island of the Paracel islands have put the spotlight on the South China Sea (SCS). Fig 1: The 200 mile Economic Exclusion Zone claimed by China around Woody Island and the overlapping 108 nm range of the HQ-9 SAM system. Image via ISI. [Image Sat International]   […]

Amid coal market struggles, less fuel worth mining

Vast coal seams dozens of feet thick that lie beneath the rolling hills of the Northern Plains once appeared almost limitless, fueling boasts that domestic reserves were sufficient to power the U.S. for centuries. But an exhaustive government analysis says that at current prices and mining rates the country’s largest coal reserves, located along the […]

US Shale Oil Drillers Finally Buckling as OPEC Pumps On

U.S. oil drillers are finally beginning to buckle. For more than a year, American oil producers found a way to keep pumping despite a worldwide slide in crude prices. Like cartoon character Wile E. Coyote, U.S. drillers dashed off the cliff and somehow kept running in midair, maintaining volumes even as revenue plummeted. Drilling companies’ […]

Forget the old Peak Oil theory, now the oil industry’s doom will be its everlasting supply

Peak-oil theorists — they’re the ones who predicted $300-a-barrel oil, because new discoveries wouldn’t materialize — were fundamentally right after all. So they say. No, not about the $300 price tag. Oil is now around US$30 a barrel and could stay there indefinitely, but that detail, they explain, only helps prove their point. And no, […]

Shale Drillers Halt Bakken Fracking as Saudis Send Gloomy Note

Continental Resources Inc., the shale oil pioneer controlled by billionaire wildcatter Harold Hamm, halted all fracking in the Bakken shale formation in the U.S. Williston Basin after posting its first annual loss since the company’s public debut in 2007. Whiting Petroleum Corp. estimates it will leave 73 uncompleted wells in the region by year-end, and another […]

Saudi Arabia’s oil minister says no oil production cuts coming

Saudi Arabia’s chief oil strategist dashed any hope the world’s biggest oil-exporting nations will cut their output to prop a depressed oil industry, saying it’s better for the market to wipe out high-cost oil producers who can’t compete. In his first encounter with the U.S. energy industry since oil prices collapsed in late 2014, Saudi […]

OPEC’s Freeze Backfires

The oil supply “freeze” is a joke. That much was confirmed Tuesday in comments made separately by the oil ministers of Saudi Arabia and Iran. The latter called it “ridiculous,” no less. The punchline? The joke’s on OPEC. There are several glaring problems inherent to the freeze, whereby members of OPEC and other large producers such as […]

With Some Tar Sands Oil Selling at a Loss, Why Is Production Still Rising?

Like a supertanker unable to make quick turns, production from tar sands in the Canadian oil patch continues to increase despite prices so low producers have to sell their output at a loss. The industry’s inability to cut production could have a profound impact on the climate as well as corporate bottom lines. Despite reductions […]

OPEC Unsure How It Can ‘Live Together’ With Shale Oil

OPEC and U.S. shale may need a relationship counselor. After first ignoring it, later worrying about it and ultimately launching a price war against it, OPEC has now concluded it doesn’t know how to coexist with the U.S. shale oil industry. “Shale oil in the United States, I don’t know how we are going to […]

Texas Oil Production on a Plateau

The Texas RRC Oil and Gas Production Data is out. There appeared to be no decline in December production and may have even been a slight increase. The Texas RRC data is incomplete and only gives an indication as to whether Texas production increased or decreased. The data appears to droop because each month the […]

Saudi-Russian Deal Not A Quick Fix For The Oil Crisis

The recent deal struck between Russia, Saudi Arabia, Qatar and Venezuela to prop up oil prices by freezing production levels at January levels might have a psychological effect on oil markets, but it will not secure a major breakthrough from the current deadlock. Oil exporters such as Venezuela and Nigeria have been calling for OPEC […]

‘Selfish’ oil firms relish new production despite glut

As oil firms scrap dozens of billions worth of mega projects essential for supplies in decades ahead, fresh output from huge fields already being developed is set to weigh for many more months on an oil market struggling to shake off a glut. A collapse in oil prices over the past 20 months to below […]

Saudi Arabia ‘not prepared’ to cut oil production

Saudi Arabia is “not prepared” to cut oil production, Agence France-Presse reported, quoting the Saudi foreign minister Adel al-Jubeir. “If other producers want to limit or agree to a freeze in terms of additional production that may have an impact on the market but Saudi Arabia is not prepared to cut production,” al-Jubeir told AFP […]

Is Saudi Arabia Winning The War Against Shale?

Saudi officials insist the kingdom’s oil production strategy is not aimed at putting U.S. shale producers out of business, a message that has been repeated to visiting U.S. policymakers. The United States remains the kingdom’s most important security partner, and Saudi officials do not want to be seen to be deliberately trying to halt the […]

Bakken December Data, Big Decline

The Bakken and North Dakota tight oil production data is out. Bakken production was down 28,604 barrels per day to 1,096,044 bpd. All North Dakota was down 29,506 bpd to 1,152,280 bpd. This is just the last two years of the chart above. It gives a slightly better look at what is happening. Barrels per day […]

Iran says it is ‘illogical’ for it to join oil output freeze

Iran’s Opec envoy is reported as saying it is “illogical” for it to join the oil output freeze agreed by a Russian and Saudi Arabian-led group on Tuesday. Mehdi Asali, quoted in the Iranian newspaper, Shargh, said Iran will continue to increase oil production until it reaches pre-sanction levels. Venezuela’s oil minister is holding talks […]

The Glaring Problem With Oil Giants’ Production Freeze

Oil traders aren’t too impressed with Saudi Arabia and Russia’s accord to cap oil production at near-record levels. After rising above $31.50 per barrel when news of this agreement was reached, front-month West Texas Intermediate futures contracts have since retreated to below $30 per barrel. It’s not just the production freeze, rather than an outright […]

Saudi Arabia, Russia agree to freeze oil output

Saudi Arabia and Russia, the world’s two largest crude producers, agreed to freeze output after talks in Qatar. The deal to fix production at January levels will be “adequate” and Saudi Arabia still wants to meet the demand of its customers, Oil Minister Ali Al-Naimi said in Doha after the talks with Russian Energy Minster […]

Estimates Of Post-2005 US, OPEC & Global Condensate Production Vs. Actual Crude Oil Production

After examining available regional and global production data (using EIA, OPEC and BP data sources), in my opinion actual global crude oil production – generally defined as 45 API Gravity or lower crude oil – has probably been on an “Undulating Plateau” since 2005. At the same time, global natural gas production and associated liquids, […]

What’s up with Saudi Arabia and its oil?

With oil prices so low, much of the oil market has its eye on one producer in particular: Saudi Arabia. It is the dominant member of OPEC. And for all the reasons oil prices fell in the first place, perhaps the biggest is OPEC’s call in late 2014 to keep pumping full bore. And flood […]

In Spite Of Its Vast Oil Reserves, Cuba Fails To Woo Investors

With the end of the 54-year U.S. trade embargo on Cuba, and Cuban government moves to encourage foreign investors, Cuba is a suddenly attractive venue that is sitting on an estimated 4.6 billion barrels of oil and promising tantalizingly low production costs that defy low oil prices. In December 2014, the U.S. lifted the trade […]

Is China Hitting Peak Oil?

China pumps more than 4 million barrels of oil a day (only Saudi Arabia, the United States, Russia, and on a good day Canada produce more), but output is expected to decline this year as the country’s oil fields mature and operations become more expensive. The WSJ reports: China is among the world’s top five oil producers, […]

OPEC Production Cut Unlikely Until U.S. Oil Output Falls Another Million Barrels Per Day

An OPEC production cut is unlikely until U.S. production declines by about another million barrels per day. OPEC won’t cut because it would accomplish nothing beyond a short-term increase in price. Carefully placed comments by OPEC and Russian oil ministers about the possibility of production cuts achieve almost the same price increase as an actual cut. […]

OPEC January Production

The latest OPEC Monthly Oil Market Report is just out. The the data is “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. The chats do not include Indonesia. That will be added within the next few months […]

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