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Shale Boom Redraws Oil Routes as Alaskans Ship to Korea

For signs of how the U.S. shale boom is transforming the global flow of oil, look halfway across the world at South Korea . The Asian nation, which relies on the Middle East for about 86 percent of its oil imports, is benefiting as new output from Texas to North Dakota displaces the crudes that fed U.S. refineries for decades. South Korea received this month a shipment of Alaskan oil for the first time in at least eight years and may buy more, the importing company said. The country was one of the first to receive a cargo of the ultralight U.S. oil known as condensate after export rules were eased. The U.S. shale revolution has driven oil output to the highest in more than three decades, reducing America’s need for overseas purchases and sinking global prices into a bear market . South Korea is seeking to reduce its […]

Posted On : Published By : Tom Whipple
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AEO 2015 Preliminary Report

The EIA published, last month,  AEO2015 Preliminary Oil & Natural Gas Production & Price Results . And just below the title they wrote:                                     DRAFT – DO NOT CITE But I am not citing anything, just informing you of what they said. What they mean however is that they reserve the right to change their mind before the report comes out early net year. And I can certainly understand that. All Oil data is in million barrels per day. They have lower 48 production hitting a slowly increasing plateau in 2016 and peaking at just under 8.4 million barrels per day in 2027. They have US Tight Oil production following pretty much the same profile, hitting a plateau in 2016 at about 5.5 million barrels per day and holding flat until starting a […]

Posted On : Published By : Tom Whipple
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Russia: gas flow will resume after Ukraine pays

AP Photo/Geert Vanden Wijngaert MOSCOW (AP) — Russia says gas supplies to Ukraine will resume after it pays off the first debt installment next week. Alexei Miller, the chief of Russia’s state-controlled Gazprom natural gas giant, made the statement Friday hours after Russia, Ukraine and the European Union thrashed out a $4.6 billion deal that will guarantee Russian gas supplies to Ukraine and further on to the EU. The deal eased fears that Europe will end up shivering this winter as occurred during a 2008 gas dispute when Ukraine siphoned gas intended for Europe and Russia turned off the taps in response. Moscow cut off gas supplies to Ukraine in June over unpaid debts, a move that followed the ouster of Ukraine’s Russia-friendly leader and the Kremlin’s annexation of Crimea.

Posted On : Published By : Tom Whipple
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Russia and Ukraine close to deal on gas for winter

©AFP Russia and Ukraine are on the verge of an EU-brokered deal to end a months-long dispute over gas deliveries that would secure supplies to the war-torn country through the upcoming winter. Officials said after all-night talks that broke up at 4am Thursday morning, three separate texts were sent back to Kiev and Moscow – including a new bilateral treaty between the two countries and a commercial agreement between Russian gas monopoly Gazprom and its Ukrainian counterpart Naftogaz – for a final review before signatures are affixed. More On this topic German exports to Russia tumble Fast FT Rouble touches new record low UK blocks €5bn Russian North Sea deal No ‘untouchables’ for Putin, says Pugachev Podcast Russia-Ukraine tensions Neil Buckley, East Europe editor, on the challenges facing Ukraine’s new pro-European parliament EU officials said they believed the deal was all but completed after the most complicated issue – […]

Posted On : Published By : Tom Whipple
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Shell Profit Increases as Refining Trumps Lower Oil Prices

Royal Dutch Shell Plc (RDSA) said third-quarter profit rose 31 percent, beating estimates, as earnings from refining and natural gas countered the impact of lower crude prices at Europe’s biggest oil company. Profit excluding one-time items and inventory changes increased to $5.8 billion from $4.5 billion a year earlier, the Hague-based company said today in a statement. That beat the $5.48 billion average estimate of 16 analysts surveyed by Bloomberg. Sales fell 7 percent to $107.9 billion. Even as Shell’s oil production slumped and prices fell since June, a mix of better refining margins, lower spending and higher earnings from selling natural gas around the world bolstered profit. That contrasts with the company’s largest European competitors, BP Plc (BP/) and France ’s Total SA (FP) , which reported lower earnings this week. “Our results today show that we are delivering on three priorities I set out at the start […]

Posted On : Published By : Tom Whipple
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Peak conventional oil adversely impacts the economy

4666 Votes By Drs. Robert & Sonia Vogl President and Vice President, Illinois Renewable Energy Association Our economy was built on cheap fossil fuels, which supported our economic and technological progress. As sources of conventional low-cost oil are depleted, we have turned to unconventional sources with higher extraction costs. With current oil prices around $80 to $85 per barrel, it has been estimated that new tar sands oil requires $95 per barrel to be extracted. If the oil is not extracted, prices could still rise, as competition for the existing oil would intensify. Energy economist Douglas Reynolds believes our economic malaise is a result of a decrease in energy supplies. He notes that the United States has a vast global military presence that we are unable to pay for, a decreasing standard of living, increased concentration of wealth, and a continuous energy crisis that began in 1973. He sees […]

Posted On : Published By : ASPO-USA
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Dubious Assumptions Underpin Latest ‘Peak Oil’ Anti-Fracking Report

David Hughes, a Canadian geoscientist and a fellow of the anti-fracking Post Carbon Institute , has emerged as one of the media’s favorite proponents of “Peak Oil,” the debunked theory that oil production will soon be in permanent decline. Never mind, of course, that there are more proven oil reserves today than there were decades ago, when “Peak Oil” advocates were saying the exact same thing as they are today. In a new report , Hughes once again gives succor to anti-development and anti-fracking activists with more claims that shale development will “peak” a lot earlier than expected. More specifically, Hughes claims that “tight oil production from major plays will peak before 2020”. He also adds: “…by 2040, production rates from the Bakken and Eagle Ford will be less than a tenth of that projected by the EIA.” Hughes is arguing, in effect, that the hundreds of thousands of […]

Posted On : Published By : Tom Whipple
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How Would We Provide Enough Energy For 11 Billion People?

Reconciling energy and environmental concerns was challenging enough when global population seemed headed for a plateau around 9 billion. A new forecast of up to 12 billion people by 2100 raises large questions about the capacity of current energy technologies to meet future global needs. The combination of forecasted global economic weakness and growing non-OPEC production continues to weigh on oil prices.  Brent crude has fallen below $90 per barrel , and the US benchmark has been flirting with $80. But just when the rapid growth of energy supplies has undermined the mood of energy scarcity that prevailed for the last four decades, a group of demographers has thrown us a curve ball , though admittedly a very long one. In the 1970s many people were concerned about a “population explosion.” Dystopian fiction–already a well-established sub-genre–featured visions of a grossly overcrowded future earth, along the lines of “ Soylent Green .” […]

Posted On : Published By : Tom Whipple
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Oil Eases on Concerns Price Gains Likely Short-Lived

By Eric Yep Crude-oil futures eased in Asian hours Thursday after posting overnight gains as markets absorbed the impact of the U.S. Federal Reserve’s monetary policy announcements. On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $81.87 a barrel at 0410 GMT, down $0.33 in the Globex electronic session. December Brent crude on London’s ICE Futures exchange fell $0.09 to $87.03 a barrel. Global oil prices settled higher for the second consecutive day Wednesday after weekly U.S. oil stockpiles didn’t rise as much as they were expected to, and petroleum product stockpiles shrunk, indicating stronger demand. But the price strength is likely to be short-lived due to the oversupply situation in oil markets, analyst Daniel Ang at Phillip Futures said. "We find new resistance [for Brent crude] at $88.81 but find it extremely difficult for prices to even stay at current levels," […]

Posted On : Published By : Tom Whipple
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WTI Oil Falls From 1-Week High as U.S. Supplies Expand

West Texas Intermediate retreated from a one-week high after government data showed crude stockpiles rose as output surged to a record high in the U.S., the world’s biggest oil consumer. Brent slid in London. Futures fell as much as 0.6 percent in New York . Crude stockpiles gained for a fourth week as production increased to 8.97 million barrels a day, the fastest rate since January 1983, according to the Energy Information Administration. Supply and demand will return to equilibrium and OPEC members aren’t waging a price war, Secretary-General Abdalla El-Badri said yesterday. “Expanding stockpiles are putting downward pressure on oil,” Kang Yoo Jin, a commodities analyst at Woori Investment & Securities Co. in Seoul, said by phone today. “Oversupply concerns in the market are not easing because OPEC isn’t making any comments so far on a possible production cut.” WTI for December delivery dropped as much as 45 […]

Posted On : Published By : Tom Whipple