Industry Trends ///
OGUK recently set out industry commitments to halve operational emissions in the next decade, with a target of 90 percent reductions by 2040. The sector was one of the first to respond to the Committee on Climate Change report in May last year which called for governments to reach net zero emissions by 2050 in the UK and 2045 in Scotland, with its Roadmap 2035: a blueprint for net zero.
According to EIA research, increases in drilling efficiency pushed U.S. crude oil and natural gas production to establish new records of 12.2 MMbpd and 111.5 Bcfd, respectively, in 2019.
Looking out 18 months, U.S. output will still be around 16% below its peak in February, according to an average of surveys from the IEA, Genscape, Enervus, Rystad and IHS Markit. It will probably be at least 2023 before the U.S. again hits its record close to 13 million barrels a day.
The weekly round of U.S. inventory data began with the American Petroleum Institute reporting that U.S. crude stockpiles rose 1.75 MMbbl last week, according to people familiar with the report. If confirmed by government data Wednesday, it would be a third weekly gain.
The pandemic-induced oil crash prompted Canadian companies to cut about 1 million barrels of daily crude output, freeing up space on the country’s previously congested pipelines. With that production likely slow to return and as many as three new conduits slated to be built in the next three years, the industry may have years of cheap, plentiful shipping capacity ahead.
The renewed strength of the “physical market” for crude -- where actual barrels change hands between producers, refiners and traders -- is driving a surge in the much larger Wall Street world of oil contracts traded on exchanges in London and New York.
Just months ago, New Mexico, the third-biggest producer of U.S. oil, approved the state’s largest budget ever, paid for by an oil boom that made up 40% of the state’s revenues in 2019. Now that plan has been slashed by more than $600 million, affecting everything from pay raises for state workers to a program designed to provide free community college to state residents.
Refiners in the top crude-importing region have been forced to accept big reductions in their regular contracted volumes from producers including Saudi Arabia and Iraq in the past couple of months. They’ve also been taken aback by sharp swings in official selling prices.
In our weekly preview podcast, Kurt and Cameron explore PESA's research into oil and gas job losses and their impact on the economy; what new rig count numbers mean for oilfield service companies; and the potential for Continental Resources to lead another U.S. shale production trend.
Drillers idled 10 oil rigs in onshore U.S. fields this week, bringing the total to 189, according to data released Friday by Baker Hughes Co. Despite this week’s rise in crude prices to a three-month high around $40 a barrel, they still are more than 35% below the January high.
K&D Pratt has expressed grave concern for the economic future of the province without a solid investment from the Government of Canada in Newfoundland and Labrador’s offshore industry.
A government proposal on Friday to slow down the development of onshore wind power comes after increasing local resistance mirrors sentiment in other European countries. Norway already decided to scrap a plan for a new permission framework last year.
The company previously announced it would curtail 70% of operated oil production in May, with continued curtailments into June. In July, the Company expects to partially begin resuming production but still expects to curtail approximately 50% of its operated oil production.
OPEC predicted that fuel demand will remain “under pressure” during the second half of this year because of the ongoing economic fallout from the coronavirus, a day before ministers were due to assess world markets.
The layoffs are coming roughly equally from the company’s offices in Calgary, Denver and The Woodlands, Texas, as well as from field staff, said Cindy Hassler, a spokeswoman for Ovintiv. Hassler declined to immediately provide a number of how many jobs were cut.
Kurt and Cameron explore the potential impact of gas flaring reforms in Texas, what a "new normal" might be for global demand, and why IEA and EIA projections diverge.
After flooding the U.S. with crude earlier this year, Saudi Arabia has all but cut off the taps to the American oil market.
The coronavirus has exposed the fragility of some of the world’s biggest oil and gas companies, but also given them the opportunity to make investors swallow some unpleasant remedies.
Brent crude rose above $40 a barrel as broader markets rallied on stimulus from the Federal Reserve and physical supplies continued to look tight.
Fuel use around the world will remain 2.5% lower next year than in 2019, largely because of the “the dire situation of the aviation sector,” the Paris-based agency said in its first detailed assessment of 2021.