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Page added on May 16, 2019
Surge of New Permian Basin Oil to Feed Global Supply
Exports of the Permian Basin’s newest kind of oil are set to jump as production surges, exceeding the appetite of U.S. refiners.
Sales of the new grade, known as West Texas Light, began in September, as explorers sought to separate out increasingly lighter and less sulfurous crude bubbling up from wells in West Texas and New Mexico, so it wouldn’t lessen the quality of U.S. benchmark West Texas Intermediate. WTL supply has grown to over 500,000 barrels a day, a nearly four-fold rise from last year.
While some of that is staying close by, most will need to be exported. Even as ample shale barrels and tighter supplies of heavier crudes have encouraged U.S. refiners to process the lightest oil since 1990, that may reach a limit soon. But since many of the biggest refineries have invested billions of dollars in upgrades over the years and are set up to run the heaviest, dirtiest oil, there’s only a certain amount of light oil they can handle.
Growing Exports
Shipments of American oil to overseas buyers have been on an uptrend
Census Bureau
“I suspect that refineries that can blend to run lighter slates are likely already doing so to the best they can,” said Michael Tran, a commodity strategist at RBC Capital Markets LLC in New York. “Every incremental barrel produced in the U.S. should be earmarked for export,” unless it’s a heavy crude, Tran said.
Shipments overseas began in February and have neared 1.42 million barrels through this month. Most was sent to the Netherlands and the rest for Canada, while none has headed to Asia so far, according to U.S. Customs data and ship tracking data compiled by Bloomberg.
Renewed U.S.-led sanctions on Iran could provide an opportunity. Buyers of Iranian condensates such as South Korea, might consider WTL, Jonathan Aronson, analyst for Cornerstone Marcro LLC in New York.
Presently, some 1 million barrels of storage has been set aside in the Permian and Cushing, Oklahoma, to market WTL, according to people familiar with the matter. Some pipes are starting to accept it as a proper grade, the people said.
More Pipelines
Still, more pipeline capacity would be needed, which is expected to start coming online late this year and in 2020. “Pipelines from Midland and Cushing to the Gulf Coast are full right now. It’s a problem for any crude, including WTL,” Aronson said.
WTL is being marketed to Asian buyers for refining and petrochemical use, according to a report by analysts at Macquarie Capital (USA) Inc. Even with its higher content of light products such as naphtha, it would be globally marketable for at least three years. However, that could change later on because of rapidly growing natural gas liquids and condensates supply, both of which have similar yields.
That might be a boon for buyers, as WTL prices could drop, particularly in Asia, which has numerous other options for light, low-sulfur crudes. Currently, the grade is trading at $1 to $1.50 a barrel under WTI Midland, compared with a $2.50 discount last month, according to people familiar with the matter.
On the whole, WTL would be a great crude for a simple refinery to run and chemical plants would like it, whether in Asia or Europe, Cornerstone’s Aronson said.
106 Comments on "Surge of New Permian Basin Oil to Feed Global Supply"
asg70 on Thu, 16th May 2019 8:06 pm
Crickets from peak oil doomers?
Coffeeguyzz on Thu, 16th May 2019 9:01 pm
Cowboyistan now and foevah!
Shortend on Fri, 17th May 2019 1:24 am
New and IMPROVED West Texas light Rochman pee grade…go down smooth….
Say goodbye to the climate we once new and allowed us to multiple.
Maybe we all should get a herd of goats and sheep to pet and blog here 24/7
Go Speed Racer on Fri, 17th May 2019 4:01 am
So what is the translation, of all
that bullshit?
(have to translate from bullshit, to understandable).
I think they just said, “shale oil is too
light a grade to be useful for anything
unless its mixed into real crude oil, sort
of like the Chinese mixing their toxic
waste barrels into your particle-board
chinese furniture, U can only put in a
little bit or it starts to become an
issue, right?
So nobody wants it because its a bunch
of paint thinner (i.e. NAPTHA that is
paint thinner right?) and so they
figure they can sucker some chinese
buyers so they will make paint thinner
and fingernail polish remover out of it.
OK. Got it. Maybe we can just burn the
shit for electricity.
Missing the good olden days when
Mr. Rockman would explain everything to
us, but I think the Peak Oil chat board
quality went so low, that he went back to
drilling for oil, instead of hanging out
on this chat board.
makati1 on Fri, 17th May 2019 4:38 am
Go, there is nothing to chat about re oily subjects. Too many lies. Too little truth. All it is now are guesses about how much is left and what the price will be on …. date in the future. No one really knows. I ignore most of the articles as they are a waste of time.
The financial collapse is going to reset the whole shooting match at a much lower level anyway. That will happen long before there is an oil shortage, except the one it will cause.
The most recent oily article I read is this one. It seems to be full of realistic facts and comments on energy.
“THE END OF THE OIL GIANTS: And What It Means”
https://www.zerohedge.com/news/2019-05-16/end-oil-giants-and-what-it-means
Not looking good for the younger generations.
I AM THE MOB on Fri, 17th May 2019 5:12 am
MAGA
Mexicans.Always.Get.Across
HAHAHA
Darrell Cloud on Fri, 17th May 2019 6:54 am
So, another liquid is added to the new all liquids total.
Robert Inget on Fri, 17th May 2019 9:03 am
Get ready for USD to CRASH.
China will be blamed for taking The Trade War to new highs. When, in fact it was Trump and his
‘protectors’ who put America’s international currency, USD, in great danger.
I’ve always maintained USD was Too Big to Fail.
I never anticipated such ignorant leadership such as DJT’s Administration has displayed.
Trump is causing the world to decide between
China and the US. One led by a canny dictator
the other led by an unpredictable, uneducated, wanna be lunatic.
Here’s the headline: “China Chooses Iran”
https://www.bourseandbazaar.com/articles/2019/5/17/china-restarts-purchases-of-iranian-oil-bucking-trumps-sanctions
If that server is jammed, try Google News;
enter the last word in the link.
Robert Inget on Fri, 17th May 2019 9:44 am
Permian’s gift is natural gas.
Once immature crude oil runs out and pipelines installed, NG Rules.
We North Americans are the luckiest bunch of SOB’s to have a turn ruining life forms on the planet.
Robert Inget on Fri, 17th May 2019 9:49 am
Venezuela, a three legged stool just lost another leg,
Giovanni Staunovo Retweeted
️
@chigrl
24h24 hours ago
More
#VENEZUELA’S 310,000 BPD CARDON OIL REFINERY HAS HALTED OPERATIONS -SOURCES
@redboxlive
Robert Inget on Fri, 17th May 2019 10:17 am
At least this on-topic post tells us there are many ways ‘Peak Oil’ comes to pass.
Venezuela joins Mexico, in this hemisphere, as
an oil importer. (at least for a time)
In real-time we get a peak into the present.
What happens when Venezuela, unquestionably
with the world’s largest stash of actual oil goes belly-up.
Mexico will survive and prosper if it can
1) limit populations now that the US labor-market safety valve is closing.
2) Build out, repair, Mexican refineries.
3) Accept Chinese factories.
4) Most importantly, supply China with food products once exported to the US.
China and Russia waited till Venezuela was in free-fall. If China needs another Western Market for its goods, South America is ready and willing.
Russian and Chinese oil personal will be able to
restore production in Venezuela. Eventually.
By that time, if the US wants to buy oil it will pay in yuan.
Cloggie on Fri, 17th May 2019 10:18 am
Exxon-Mobile knew in 1982 exactly how large global warming would be in 2019, but has always sawn doubt about manmade climate change:
https://m.spiegel.de/wissenschaft/mensch/exxon-sagte-co2-gehalt-der-atmosphaere-fuer-2019-genau-voraus-a-1267915.html
It is now all out in the open.
Robert Inget on Fri, 17th May 2019 1:09 pm
Speaking of Old News,
Six million tons of contaminated Russian crude??
“How long until normal flows are restored everywhere?
While Russia expects to return supplies to normal in the second half of May, Belarus has said a full resumption of flows through Druzhba may take several months. Hungary’s Mol expects deliveries of good quality crude in the pipeline from the second half of this month. Members of the International Association of Oil Transporters are set to discuss the situation in Bratislava, Slovakia, on May 13-14, Belarus’s Belneftekhim said Monday.
What’s happening to the contaminated oil?
While there is nearly 1 million tons of contaminated oil in Belarus, the overall amount of substandard Urals crude in pipelines across the country, Russia, Ukraine and Poland may have been as much as 5 million tons as of the end of April.
Most of the tainted crude remains in the pipelines and is “eating away at them,” Belarus President Alexander Lukashenko said on Saturday. The nation and Russia are discussing what to do with the oil with no clear deadline for removing it. Belarus has been able to pump out some of the substandard crude into reservoirs in order to free up a part of the Druzhba pipeline to the Mozyr refinery and into Ukraine.”
Here we have something like an oil spill contained
in a 110 mile steel tube, with no place to go.
Maybe we could arrange scenic (wooden) boat tours of those Ukrainian “reservoirs”.
Antius on Fri, 17th May 2019 7:28 pm
An interesting idea that may find new practicality in the years ahead.
https://en.m.wikipedia.org/wiki/Gyrobus
The gyrobus (flywheel bus) was historically heavy and cumbersome, as flywheels were made from carbon steel. However, modern flyweels can be made from carbon and glass fibres and high-strength plastics. This makes a huge difference in terms of specific energy and makes the concept more workable in terms of range and deadweight.
Why use the gyrobus instead of the battery bus or tram? Compared to batteries, modern flywheels could offer similar energy density, but have lower embodied energy, lower resource requirements and would endure more charge-discharge cycles. They are also technically easier to develop. Flywheels are also more effective than batteries at absorbing energy from regenerative braking.
The main advantage over the trolley bus and tram, is the elimination of the need for overhead wires, which add a lot of cost.
Similar options for powering the bus are compressed air and hydraulic cylinders. These things have much lower energy density than liquid fossil fuels, but are workable for short journeys between stops at which the bus can recharge.
Solutions like this are for public transportation, not cars. The same is true of the tram and trolley bus. And of course public transport is generally more energy efficient than car travel. We could actually maintain urban transport quite effectively using systems like this, without a drop of oil and using relatively small amounts of electric power. A sustainable transport system would not involve much car travel. In 50 years, the bicycle will be more popular than the car as a private transport option, because it will be an option that people can still afford.
Anonymous on Sat, 18th May 2019 1:58 am
Translation is the grade is selling for $1-$2 less than WTI. In other words if the WTI posted price is $64, these guys get $62 to $63.
No big deal in terms of the small discount. And it is being handled fine by creation of a dedicated grade and storage and pipeline batching. And it is a desirable grade for export market.
Davy on Sat, 18th May 2019 5:37 am
thanks, Nony, for the professional comment as usual!
Robert Inget on Sat, 18th May 2019 8:41 am
STORM WARNIING
https://mobile.reuters.com/article/amp/idUSB2N22S012?__twitter_impression=true
Robert Inget on Sat, 18th May 2019 8:57 am
US Exported 3 MB p/d last week.
US Imports lagged due to several factors.
‘Experts’ anticipate a ‘record draw’ coming Wednesday. (biggest since 2011)
Scroll own to ‘Global-on Water’ chart.
https://seekingalpha.com/article/4265026-physical-oil-market-saying-see-largest-crude-storage-draw-since-2011?ifp=0
I always have to laugh when oil jumps up or down
in a single day in reaction to an incident in the ME
when it can take at least six weeks at sea for deliveries.
In years past ‘at sea’ timing was modified by Venezuela, a three day sail.
(There will be no VZ foreseeable deliveries)
dissident on Sat, 18th May 2019 9:02 am
The only thing surging is the BS in this article. Show me the production, investor scam boi.
Incredible how suckers will believe that the volume of oil and gas in tight pore rock deposits somehow is the same as in conventional plays. Magical thinking in action. And, BTW, there is no such thing as shale oil. Shale is young rock with kerogen deposits. Tight pore shale-like rock is not shale. Consider the Bakken.
Cloggie on Sat, 18th May 2019 9:10 am
STORM WARNING
https://mobile.reuters.com/article/amp/idUSB2N22S012?__twitter_impression=true
These folks will be the first to be informed by the US government about impending (geopolitical) shock waves. Thermometer in the b*tt of the Pentagon, so to speak.
Robert Inget on Sat, 18th May 2019 11:13 am
I’ve been saying the exact same thing ‘dissident’.
There is no way to tell if anyone here cares or listens.
My point has been and still is; Bakken could be a remarkable natural gas resource once pipelines are switched over from non performing ‘condensates’ to NG that is for now, flared.
Speaking of nonperforming, with Venezuela out of the picture, existing Canadian/US pipelines jammed, condensates certainly won’t cut it.
Robert Inget on Sat, 18th May 2019 11:34 am
Cloggie, If Congress and/or the President don’t want a full on conflict, we won’t have one.
I know you wish to see Israel flattened. You may just have to settle for diesel shortages.
80 Million Iranians are not caving to an Axis Trio;
Trump, Pompeo, Bolton.
IMO all three will be gone this year.
As we say in the West; ‘The law done caught-up
with him.’ Like any game fish, trump will fight as long as his backers funds hold out. Once Trump is more trouble than he’s worth, Senate support drains.
It’s almost time for Trump to pick out a dacha near a golf course with no US extradition treaty.
Davy on Sat, 18th May 2019 11:56 am
“There is no way to tell if anyone here cares or listens.”
Bob, you and dizzy are flaming anti-Americans so of course you are going to take extreme positions on these things. When it comes to oil I tune in on Nony instead. You two are way to emotional.
Cloggie on Sat, 18th May 2019 12:02 pm
“I know you wish to see Israel flattened.“
You couldn’t be more wrong.
I want to see Washington flattened, not Israel. Israelis are normal, tribal people, with a country, capital, anthem, soccer tean, Eurovision singer, etc.
Hitler was pro-Israel, in the thirties he cooperated with the Zionists. For him Palestine was the Final Solution of the Jewish problem, in a non-sinister meaning. Unfortunately the British did not cooperate and neither did the French and Madagaskar. And in 1940 Stalin wasn’t interested either. Hence the Wannsee conference in january 1942, designating the Ukraine as the final solution, enabled by Barbarossa.
The problem is not Israel, the problem is Henry Ford’s “International Jews”:
https://documents1940.wordpress.com/2019/02/10/them-again-plotting-for-war-in-europe/
https://documents1940.wordpress.com/2019/05/12/any-questions-white-man/
https://documents1940.wordpress.com/2019/04/21/clown-zelensky-president-ukraine/
https://documents1940.wordpress.com/2019/04/04/they-admit-it-themselves/
“80 Million Iranians are not caving to an Axis Trio;
Trump, Pompeo, Bolton.
IMO all three will be gone this year.”
That’s a bold assertion.
Cloggie on Sat, 18th May 2019 12:49 pm
Massive populist demonstration in Milano-Italy today:
https://www.youtube.com/watch?v=jV2__74nKvk
ALL of the populist big whigs are present:
Salvini-I
Meuthen-D
Le Pen-F
Wilders-NL
…and others.
Salvini has the most charisma and is willing to, subtly, indirectly, prudently address the JQ:
https://www.youtube.com/watch?v=1jt9MLdg3JQ
Let him be the “Roman emperor” of European nativism and deliver a European Europe, including Russia, rather than a multicult third world shithole, George Soros has in store for us.
The European cards are so much better than in 1939!
I AM THE MOB on Sat, 18th May 2019 1:03 pm
Oil is not used for energy production but for transportation, while only a small part of electricity is used for transportation, so it is not a good substitute. Then we have the problem that solar and wind are low density, intermittent sources. So they are also not good substitutes for nuclear or fossil fuel electricity generation. Under a contracting economy with expensive oil derivatives the world won’t be able to substitute the over a billion vehicles even if possible. It probably isn’t possible because of battery limitations.
If the energy becomes costlier it is equivalent to our main resource becoming more scarce. And it is known what happens to complex civilizations when their main resource base contracts. The key author here is Joseph Tainter: “The collapse of complex civilizations” (1988). You can get a copy here:
http://gen.lib.rus.ec/book/index.php?md5=95D1F492D6186FC1676042FA835D224E
Complex societies resolve problems by building complexity using the surplus from their base resource utilization. As they become more complex the return from this surplus utilization keeps decreasing, as it responds to the universal law of diminishing returns, while the complexity keeps increasing. When the resource base decreases there is no way to maintain the complex society, that cannot be simplified in an organized manner. As more and more people feel the system is no longer useful to them and not worth maintaining, collapse follows.
That is what is going to happen. As oil becomes costlier the economy will perform worse excluding more people and making an energy transition impossible. Then the system starts collapsing, and what we have seen in several countries from different causes (Sudan, Somalia, Yemen, Syria, Libya, Venezuela) will start happening to more and more countries, also from different causes with a common theme. Supranational organizations and heterogeneous countries will break up and globalization will unravel producing conflicts and a lot of social unrest.
The Soviet Union collapsed from a reduction in their base resource, but the rest of the world was doing well so things never got too bad and recovery was possible afterwards. The global collapse will be a lot worse.
Cloggie on Sat, 18th May 2019 1:08 pm
PBM in action tonight. Eurovision Song Contest will be broadcasted from Tel Aviv. This is THE pan-European and largest television event of the year world-wide (600 million viewers).
Russia always participates and is always doing well, which can’t be said of the 4 largest EU nations D, F, I and UK.
According to the bookies, this year towering favorite is [drumroll] Holland! (sorry guys):
https://eurovisionworld.com/odds/eurovision
45% chance of winning (meaning 55% chance that one of the other 19 contestants will win).
Dutch entry:
https://www.youtube.com/watch?v=Eztx7Wr8PtE
My personal favorite, a Greek singer from Montreal, but her video is much better than her stage performance:
https://www.youtube.com/watch?v=ulQoRPcQVDc
The most dangerous competitor from the Dutch perspective, comes from Australia, who, edgy, for this times in five years of Australian participation, is white (as in *** WHITE ***). They must have a KKK administration Down-under.
She comes with a stick btw:
https://www.youtube.com/watch?v=m3WF2AsxLB8
To top it of, Madonna will sing during the break.
If it can’t be Holland, obviously I hope that Russia wins, for geopolitical reasons. It would be great if 102 years after the Petersburg Revolution, an Israeli would be forced to hand over the keys of the event to the ethnic Russians and score major European prestige points.
Davy on Sat, 18th May 2019 1:27 pm
“I hope that Russia wins, for geopolitical reasons.”
Natzi thing.
Cloggie on Sat, 18th May 2019 1:58 pm
Russia winning is a “natzi thing”
Uhuh:
https://youtu.be/gEpUgRtXBss
Shithole country dave is so keen on virtue signaling that he gets ever less critical in choosing the occasion for the launch. There is something deeply pathetic about this guy.
Davy on Sat, 18th May 2019 2:05 pm
Nope, Cloggo, this is about you personally. An event like this is supposed to be a time of enjoyment from entertainment where people put their anger and hate aside IOW bring people together. You leave your hate and resentment on everything you touch. You are one uptight SOB.
Cloggie on Sat, 18th May 2019 2:32 pm
For me the event IS enjoyment. It is you who is brunging up Natzis again.
Germany just ready, Russia now.
Davy on Sat, 18th May 2019 3:08 pm
Come to think of it, this is about pretty much all of you guys personally. I hate everyone that doesn’t have the same opinions about stuff as me. That makes me the most uptight SOB here.
I AM THE MOB on Sat, 18th May 2019 3:26 pm
Clogg
HAHAH! Fuck your faggot ass music contest..there is a great reason all the best artist and musicians come from America..
Here is one of my favorite artist…(Drumroll) “Theory of a dead-man”
https://www.youtube.com/watch?v=uCDMGPZTv9U
Rather fitting name of a band for ole Mobster..
Cloggie on Sat, 18th May 2019 3:36 pm
You have a song contest mobby?
If not, why not?
We have the biggest event, you don’t.
Cloggie on Sat, 18th May 2019 4:15 pm
In the absolute certainty that peak oil won’t happen tonight (but we have mobster standing by to inform us in case things go wrong), some more saturday-night ESC spamming. All songs have been sung.
Latest bookmakers status:
https://eurovisionworld.com/odds/eurovision
NL 42%
AUS 16%
CH 12%
I know for a fact you are all praying for a Dutch victory.
Oh and voted for Russia, for reasons well known.
Cloggie on Sat, 18th May 2019 4:41 pm
Good news for America!
https://www.ebu.ch/news/2019/05/ebu-signs-agreement-to-develop-eurovision-song-contest-in-usa
“EBU SIGNS AGREEMENT TO DEVELOP EUROVISION SONG CONTEST IN USA”
I’m sure we are going to make a big success out of it!
Europe is back, what happened to Monroe doctrine?
Cloggie on Sat, 18th May 2019 4:43 pm
Now we have Madonna, she agreed to pop over for 300 million €.
Cloggie on Sat, 18th May 2019 4:47 pm
Bookmakers:
https://eurovisionworld.com/odds/eurovision
NL 50%
CH 12%
AUS 8%
It’s now hello vs me.lol
I AM THE MOB on Sat, 18th May 2019 4:54 pm
Clogg
Calm the fuck down..Nobody on this board gives a rats ass about your stupid faggot karaoke contest..Everyone on this board except you in America..
Its like you are having a conversation with yourself..
God you are a cringy loser..No wonder you became a nazi..I probley would to if I was you..At least they will welcome you into their group, since they will take anyone..
LOL
Cloggie on Sat, 18th May 2019 5:09 pm
“Nobody on this board gives a rats ass about your stupid faggot karaoke contest.”
You do.
Abominal performance by Madonna, even the Dutch moderator said so.
Vote counting begins…
Cloggie on Sat, 18th May 2019 5:12 pm
Portugal first: Holland douze points!
JuanP on Sat, 18th May 2019 5:42 pm
juanpee posting
Davy on Sat, 18th May 2019 3:08 pm
Come to think of it, this is about pretty much all of you guys personally. I hate everyone that doesn’t have the same opinions about stuff as me. That makes me the most uptight SOB here.
Davy on Sat, 18th May 2019 5:44 pm
“EBU SIGNS AGREEMENT TO DEVELOP EUROVISION SONG CONTEST IN USA”
cloggo, don’t you think the world has bigger fish to fry than this bread and circus shit BTW shit that you eat up.
Cloggie on Sat, 18th May 2019 5:48 pm
Jews give us douze points!
Cloggie on Sat, 18th May 2019 6:02 pm
Holland wins, beats Sweden!!!!!!!!!!!!
I AM THE MOB on Sat, 18th May 2019 6:07 pm
Clogg
Why don’t you get a fucking life..Nobody cares about your stupid gay female sounding music..
This blog is about oil and doom..
Anonymouse on Sat, 18th May 2019 6:25 pm
See cloggedAnus, even your buddy ‘Empire Dave’, stupid name btw, thinks your a waste of bandwidth. If he sounds conflicted, it is because he is. On the one hand, DavyMOB here absolutely adores you and your jew puppet act, otoh, he thinks he is the smartest thing in the room, and so do you, ROFL, thus, confliction.
Eurovision…..Madonna…worthless cloggJude
Antius on Sat, 18th May 2019 6:30 pm
Didn’t watch Eurovision this time round. But well done to the winners.
Cloggie on Sat, 18th May 2019 6:33 pm
Thanks Antius.
And the finger to the resident haters.
Go to sleep now, have a plane to catch in 5 hours.
Davy on Sat, 18th May 2019 6:36 pm
20/7 cloggo sleeps?