Month: January 2015

ENLARGE A petro-chemicals factory in Kawasaki, Japan, photographed last month. Oil prices fell lower in Europe Monday after tumbling below $50 a barrel in Asian trading. Reuters LONDON—Oil prices started the week deep in the red, falling to fresh 5½ year lows as analysts took an even more bearish outlook on crude. Over the weekend, Goldman Sachs and Société Générale joined the list of analysts who have slashed their oil-price forecasts projecting that crude’s dramatic slide since last summer could continue well into 2015. Crude futures have fallen more than 50% since a peak in June on the back of strong global supply and lackluster demand. Brent crude for February delivery on London’s ICE Futures exchange fell 2.5% to $48.86 a barrel, trading near its lowest levels since April 2009. On the New York Mercantile Exchange, front-month WTI futures shed 2.3% to trade at $47.25, after losing 8.2% last […]

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Crude oil approached six-year lows on Tuesday after a leading Opec producer said the cartel would not change its strategy to hold production at current levels, adding that a rebound in prices was unlikely. Brent crude, the international benchmark, and West Texas Intermediate have fallen almost 60 per cent since the middle of June to levels last seen in early 2009. ICE February Brent fell as far as $45.23 a barrel before recovering to $45.39 a barrel, down $2.04 in early trading. Nymex February West Texas Intermediate declined $1.57 to $44.50. More On this topic IN Commodities Speaking at an energy conference in Abu Dhabi, Suhail bin Mohammed al-Mazroui, the oil minister for the United Arab Emirates, said that he was confident that Opec’s November decision made in Vienna was the right one “The strategy will not change . . .” he said of the move to keep output at its existing […]

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International crude oil prices are close to undercutting the main U.S. grade for the first time in 18 months, a signal to Societe Generale SA that Saudi Arabia’s strategy of curbing growth in shale production is working. The CHART OF THE DAY shows how West Texas Intermediate, the U.S. oil grade traded in New York, cost $1.28 a barrel less than Brent, the international benchmark, at 9:30 a.m. in London today. A year ago, the American price was $15.49 lower, fortifying the nation’s refineries with cheaper feedstocks and hastening a slump for European processors. The gap is narrowing in part because Saudi Arabia is leading the Organization of Petroleum Exporting Countries in maintaining crude production amid a global surplus. The strategy is to curb output growth from shale formations and higher cost producers. A narrower gap helps make international crudes more attractive to U.S. refiners while a wider one […]

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The United Arab Emirates will stick with a plan to increase oil-production capacity to 3.5 million barrels a day in 2017 even as an oversupply pushed prices to the lowest in more than five years. “In this time of unstable oil prices, we are showing in Abu Dhabi and across the country that we remain dedicated to reach our long-term production goals,” Energy Minister Suhail Al Mazrouei said in a presentation in Abu Dhabi yesterday. “Our investments remain there.” Oil fell to the lowest level since March 2009 yesterday after Goldman Sachs Group Inc. (GS) and Societe Generale SA (GLE) cut their price forecasts. Venezuela called on producers in the Organization of Petroleum Exporting Countries to work together to lift prices back toward $100 a barrel. The U.A.E., the fifth-largest OPEC member, produced 2.7 million barrels a day last month and has a current capacity of 3 million barrels […]

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Oil extended losses to trade below $45 a barrel amid speculation that U.S. crude stockpiles will increase, exacerbating a global supply glut that’s driven prices to the lowest in more than 5 1/2 years. Futures fell as much as 4 percent in New York , declining for a third day. Crude inventories probably gained by 1.75 million barrels last week, a Bloomberg News survey showed before government data tomorrow. The United Arab Emirates , a member of the Organization of Petroleum Exporting Countries, will continue to expand output capacity, while shale drillers will probably be the first to curb production as prices fall, according to Energy Minister Suhail Al Mazrouei. Oil slumped almost 50 percent last year, the most since the 2008 financial crisis, as the U.S. pumped at the fastest rate in more than three decades and OPEC resisted calls to cut production. Goldman Sachs Group Inc. said […]

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URL: http://www.rigzone.com/news/oil_gas/a/136693/Nearly_2_Of_Global_Crude_Could_Be_Cash_Negative_at_40_Brent Wood Mackenzie concludes that producers could start shutting in production at $40/bbl Brent crude or lower, causing a significant reduction in global supply. A recent analysis by Wood Mackenzie found that 1.6 percent, or 1.5 million barrels of oil per day (MMbopd), of global oil supply could be cash negative on an operating basis if Brent crude falls to $40/barrel. Wood Mackenzie’s analysis of 2,222 producing oil fields, which account for 75 million barrels per day of total liquids production, determined at three price points the impact on oil production and percentage of global supply which will turn cash negative. The firm concluded that producers would begin shutting in production at $40/bbl Brent crude or lower, to a point where a significant reduction in global supply would result. “The cash operating cost for oil fields becomes very important as prices producers can achieve for the oil they […]

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Goldman Sachs said U.S. oil prices need to trade near $40 a barrel in the first half of this year to curb shale investments as it gave up on OPEC cutting output to balance the market. The bank reduced its forecasts for global benchmark crude prices, predicting inventories will increase over the first half of this year, according to an e-mailed report. Excess storage and tanker capacity suggests the market can run a surplus far longer than it has in the past, said Goldman analysts including Jeffrey Currie in New York . The U.S. is pumping oil at the fastest pace in more than three decades, helped by a shale boom that’s unlocked supplies from formations including the Eagle Ford in Texas and the Bakken in North Dakota. Prices slumped almost 50 percent last year as the Organization of Petroleum Exporting Countries resisted output cuts even amid a global […]

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NEW YORK (Reuters) – Oil fell 5 percent to its lowest in nearly six years on Monday, extending the second-deepest rout on record, after Goldman Sachs warned that prices would fall further and Gulf oil producers showed no sign of cutting output. An unusual spate of major refinery glitches across the U.S. East and Midwest added to the concerns, threatening to accelerate a buildup of surplus crude. Brent LCOc1 fell $2.68, or more than 5 percent, to settle at $47.43 a barrel, its third-largest one-day decline since 2011 and its lowest close since March 2009. The decline was the 10th in the past 12 sessions. U.S. crude CLc1 settled down $2.29 at $46.07, leading losses across the complex. Gasoline RBc1 and ultra-low sulphur diesel (ULSD) HOc1 futures fell by around 3 percent as refinery outages spurred some prompt buying. "I figured we’d see $40 in the near term, but […]

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