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BHP cuts shale production amid drop in oil price

BHP Billiton is cutting its shale oil production and reducing the number of rigs it operates onshore in the US by 40 per cent due to the drop in oil prices . The world’s biggest miner by market capitalisation said on Wednesday that the revised drilling programme would boost efficiency but added that its shale investment programme remained under review. “In petroleum, we have moved quickly in response to lower prices and will reduce the number of rigs we operate in the onshore US business by approximately 40 per cent by the end of the financial year,” said BHP. This will reduce the number of rigs it operates to 16, down from 26. BHP’s drilling programme will be focused on its higher quality liquids-rich Black Hawk acreage in southern Texas. Noting that many of BHP’s peers were also cutting rig numbers at their shale oil operations in the US, […]

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Obama: America is No. 1 producer of oil, gas

The United States is on top of the world in terms of energy production, President Barack Obama said during his sixth State of the Union. “We believed we could reduce our dependence on foreign oil and protect our planet,” he said during his Jan. 20 address. “And today, America is number one in oil and gas. America is number one in wind power. Every three weeks, we bring online as much solar power as we did in all of 2008.” We decided to check out the data and see if in fact the United States is the world’s top oil and gas producer. As it turns out, the United States passed Saudi Arabia about two years ago in terms of oil production. And we’ve been the top producer of natural gas for more than two decades. The  U.S. Energy Information Administration , which tracks global energy production and consumption statistics, […]

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Russia taps Far East oil field

Though hobbled by sanctions, Russian oil company Rosneft announces new production from Far East field. (Photo: Rosneft) MOSCOW, Jan. 20 (UPI) — Hobbled by sanctions, Russian energy company Rosneft announced it joined its U.S. partners at Exxon Mobil in starting oil production from a Far East field. The Russian oil company said the production platform tied to the Arkutun-Dagi field yielded its first oil supplies Monday. Rosneft said the field should have a full-year peak production rate of about 32 million barrels of oil. Rosneft is the target of Western economic sanctions. Igor Sechin , its chief executive officer, is also the target of punitive economic measures. Sechin in August asked the Kremlin to use a national welfare fund to support its growing debt . With oil prices at historic lows, the Russian economy entered 2015 while teetering on the brink of recession. With new oil coming from its […]

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Ukraine, Poland ink gas pipeline deal

Prime Minister of Ukraine Arseniy Yatsenyuk has signed agreement with neighboring Poland to diversify regional gas networks. File Photo by John Angelillo/UPI KIEV, Ukraine, Jan. 20 (UPI) — The Ukrainian prime minister announced a pipeline deal with neighboring Poland that diversifies the energy sector with better access to liquefied natural gas hubs. Ukrainian company Naftogaz signed a deal with its Polish counterparts, Gaz-System, to build a pipeline between the two countries. Ukrainian Prime Minister Arseniy Yatsenyuk said the deal ensures his country remains an important hub in the European energy market. It’s not a reverse pipeline, "but it means an access to gas from the LNG terminals that have already been built in [Lithuania] and Poland," he said. The European market gets about a quarter of its gas needs met by Russia, though most of that runs through Soviet-era transit networks in Ukraine. Lingering contractual disputes between Kiev and […]

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Coming to Terms With the New Oil Reality

Dow Jones Newswires By Gabriele Steinhauser The sharp drop in oil prices has already roiled markets and pummeled energy companies. But its impact on oil production and climate policies is likely to last years past the moment when prices have recovered. The shale boom in the U.S., where oil production has nearly doubled over the past 10 years, and the refusal of the Organization of the Petroleum Exporting Countries to cut output, have contributed to a glut on global energy markets. At the same time, low growth in Europe and emerging markets is holding down demand, upending long-held assumptions of scarcity and ever-increasing prices. "The expectations that have governed the world for over a decade have been overturned by a new reality," says Daniel Yergin, vice chairman of energy research firm IHS and author of several books on the global oil market. Since the beginning of the year, investment […]

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Natural gas to unseat coal as generation king by 2035

Natural gas to unseat coal as generation king by 2035 thumbnail Information Administration predicts that natural gas will dethrone King Coal by 2035, and a number of market forces are at work that may assure that ascension. Coal through the first three quarters of 2014 provided roughly 51 percent of the nation’s electricity, and Wyoming supplies about 40 percent of that coal. Comparatively, natural gas through the period fueled about 20 percent of utility generation. In other words, the transition hasn’t happened just yet. However, 45 gigawatts of coal-fired capacity is set to retire in the next two years, and most of it will likely be replaced by natural gas generation. In Wyoming, the 132-megawatt Cheyenne Prairie Generating Station recently went online, replacing 82 megawatts of “older, coal-fired generation that cannot be economically retrofitted to meet new EPA air emissions regulations and must be retired,” according to a company […]

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Oil Steady After Biggest Loss in a Week as IMF Cuts Forecasts

Oil was little changed in London as the International Monetary Fund cut its global-growth outlook by the most in three years. Brent gained 0.1 percent after slumping by 2.7 percent yesterday. The world economy will grow 3.5 percent in 2015, down from the 3.8 percent pace projected in October, the Washington-based IMF said in its quarterly global outlook yesterday. Prices pared earlier losses as German investor confidence jumped to the highest level in 11 years. Futures declined in New York . Oil slid more than 50 percent since June as the U.S. pumped at the fastest pace in more than three decades and the Organization of Petroleum Exporting Countries resisted calls to cut output. The IMF’s downgrade, following reduced growth expectations published by the World Bank on Jan. 13, undermines speculation that lower oil prices would spur economic activity. “The IMF revision is part of the general growth downgrade […]

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Oil below $49 after IMF cuts growth forecast

London (Reuters) – Brent crude oil prices steadied below $49 a barrel on Tuesday after the International Monetary Fund cut its forecast for global economic growth in 2015 implying lower demand for fuel. Global growth is projected at 3.5 percent for 2015 and 3.7 percent for 2016, the IMF said in its latest World Economic Outlook report, reducing its forecast by 0.3 percentage points for both years. "New factors supporting growth – lower oil prices, but also depreciation of euro and yen – are more than offset by persistent negative forces," said Olivier Blanchard, the IMF’s chief economist. Brent crude traded around $48.84 a barrel by 1050 GMT, unchanged from Monday’s close. U.S. crude was trading down $1.28 cents from Friday’s close at $47.41 a barrel. U.S. markets were closed on Monday for a public holiday. Oil prices have dropped by more than half since June as output has […]

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How Low Can Oil Go? And When’s It Going Back Up?

ByGeorgi Kantchev Low crude prices will put a dent in relentless supply. Getty Images What a difference a year makes. In January 2014, Goldman Sachs said it did not “expect a material collapse in oil prices,” citing Saudi Arabia’s preference for prices of around $100 per barrel, and the country’s position on being ready to cut production to support those levels. One year later, crude prices are hovering around $50 a barrel and the Saudi Arabia-led Organization of the Petroleum Exporting Countries has repeatedly declined to cut the supply. Consequently, Goldman slashed its 2015 oil price forecasts last week, predicting that “this bear market will likely be characterized by more of a U-shaped recovery and will likely rebound to far lower price levels from where they sold off.” Goldman is not alone. In recent weeks several major banks have lowered their estimates for crude prices this year amid little […]

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IMF Cuts Global Economic-Growth Outlook

ENLARGE Olivier Blanchard speaks in Mexico City in July. The IMF’s chief economist called the price of oil a shot in the arm, but said that ‘there is clearly a state of weakness in the world economy and this shot is not enough.’ Susana Gonzalez/Bloomberg News Sliding oil prices will give global growth a brief jolt, but the benefits won’t be strong enough to keep the world economy out of a deepening long-term rut, the International Monetary Fund said. In new forecasts, the IMF downgraded its outlook for more than a dozen of the world’s largest economies, including markedly slower growth in China. The fund said global growth would be 0.3 percentage point lower this year and next than it had previously expected. It now expects the world economy to expand 3.5% this year and 3.7% in 2016. “The price of oil is a shot in the arm,” IMF […]

Posted On : Published By : Tom Whipple