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Low Oil Prices Prompts Apache to Lay Off Workers

Apache Corp. confirmed to Rigzone on Thursday plans to lay off workers. Apache is the latest company to announce layoffs due to weakening oil prices, which have prompted companies to slash their 2015 budget plans and reduce their workforces. The staff reduction constitutes less than 5 percent of the Houston-based company’s global workforce, an Apache spokesperson told Rigzone. “The decision to part with employees is always a very difficult one, and it’s a step we took after pursuing other measures including a slowdown in activity and reduction in budgets given the current price environment,” the spokesperson noted. A recent Rigzone survey found that oil and gas managers were planning to scale back their hiring plans this year due to declining oil prices and an uncertain economic environment. Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at [email protected] . WHAT […]

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Schlumberger Cuts 9,000 Jobs as Oil Slump Portends Uncertainty

Schlumberger Ltd. (SLB) , the world’s biggest oilfield-services company, tackled the “uncertain environment” of plummeting crude prices head-on by cutting 9,000 jobs and lowering costs at a vessels unit. The 7.1 percent workforce cutback, along with the reduction and reassessment of its WesternGeco fleet, were among steps leading to a $1.77 billion fourth-quarter charge in anticipation of lower spending by customers in 2015, the Houston- and Paris-based company said in an earnings report Thursday. Energy companies, coping with oil worth less than half its price six months ago, are expected to cut spending in the U.S. by as much as 35 percent this year, according to Cowen & Co. The number of onshore U.S. rigs could fall by as much as 750 this year, Wells Fargo & Co . said in a note Wednesday. That would be a 43 percent decline from the 1,744 in operation at the start […]

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Shale Gas Lobby Backfires in Pennsylvania

Sign image via weaverphoto/flickr. Creative Commons license. 2.0. This past November, Gov. Tom Corbett became the first standing governor in the last 40 years in Pennsylvania to lose a second term reelection. As the GOP scored overwhelming victories nationally that November night, incumbent Gov. Corbett lost by more than 325,000 votes to Democrat Tom Wolf. Corbett was a powerful first term governor who oversaw the huge shale gas industry drilling boom in the Pennsylvania Marcellus Shale formation which vaulted the state into the middle of a unexpected U.S. energy boom. By the time Corbett took office for his first term, Pennsylvania’s shale gas industry was creating jobs in several of the depressed regions of the state and had created an opportunity for a tax revenue base which would have been the envy of virtually all mid-Atlantic and northeast region states. Yet these facts did not translate into success for […]

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British shale set for real-time monitoring

British Geological Survey said it plans to study two proposed hydraulic fracturing sites in real time.. Photo by Christopher Halloran/Shutterstock LONDON, Jan. 15 (UPI) — In a regional first, the British Geological Survey said Thursday independent monitors would study two hydraulic fracturing sites in Lancashire in real time. "This ground breaking research will provide new scientific insight and innovative ways of monitoring the environment impact of shale gas development," John Ludden, BGS executive director, said in a statement. The British government in 2012 enacted new restrictions on hydraulic fracturing, ending a moratorium enforced after minor tremors were reported near Lancashire drilling sites. Shale pioneer Cuadrilla Resources has two applications before a county council with the aim of exploring for shale natural gas. A consortium led by BGS and university partners will carry out groundwater, regional air quality and seismic activity research at two proposed fracking sites in Lancashire. "It […]

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Tullow Oil Cuts Exploration Budget

ENLARGE Oil exploration companies, such as Tullow Oil, don’t have other parts of their business to fall back on when oil prices fall. Bloomberg News LONDON— Tullow Oil PLC Thursday said it was making its largest ever write off of $2.7 billion before tax, mostly resulting from unsuccessful exploration programs and the drop in value of licenses, discoveries and assets resulting from the plunge in oil prices . The write offs include a decrease in value of $600 million across all of Tullow’s assets, including producing oil fields, oil in the ground and equipment. They also include $1.2 billion related to discoveries in previous years that now have no prospect of commercialization amid the weaker oil prices and unsuccessful exploration drilling. The price of oil has more than halved in the past six months, hitting the exploration and production sector hard. Unlike the major oil companies BP PLC and […]

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North Sea Pays the Price of Oil Slide

ENLARGE BP’s Valhall redevelopment project in the North Sea. The company intends to cut 300 jobs in the area as part of a shake-out brought about by the slide in oil prices. European Pressphoto Agency LONDON— BP PLC said Thursday that it would lay off about 300 people in the North Sea hub of Aberdeen, Scotland, in the biggest sign yet of the problems besetting the U.K.’s primary oil-producing region. While the world-wide slide in the price of oil has focused attention on the U.S.’s relatively new shale fields—which are partially responsible for the global oil glut—it is the mature, high-cost fields such as those in the North Sea that seem likely to suffer most. At prices much below $75 a barrel or so, some of the North Sea’s reserves might be too expensive to develop. BP said Thursday that it is still committed to the region, and that […]

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Urgent N Sea oil review ordered as job axe falls on Aberdeen

Challenge: Aberdeen is centre of the UK oil sector The British government has ordered an urgent review of the North Sea oil industry after a collapse in prices that has prompted hundreds of job losses and raised fears for the survival of ageing fields. BP’s UK arm told staff in Aberdeen on Thursday that it would cut 300 staff and contractor jobs from its 3,500-strong North Sea business — the latest in a series of job losses and pay cuts in the sector. More On this story On this topic IN UK Economy During a visit to Aberdeen to discuss the impact of slumping oil prices, Ed Davey, the energy secretary, said he had instructed Andy Samuel, the chief executive designate of Britain’s new Oil and Gas Authority, to “lead an urgent commission, working with industry, to identify the key risks to [UK] oil and gas production”. Mr Davey […]

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BP Faces Up to $13.7 Billion in Fines in Deepwater Gulf Spill Case

ENLARGE Thursday’s decision narrows the range of penalties BP could face. Bloomberg News A federal judge ruled Thursday that BP PLC is liable for spilling just over 3 million barrels of crude into the Gulf of Mexico in the 2010 Deepwater Horizon disaster, 24% less than federal prosecutors had claimed. The ruling means that BP faces a maximum penalty of $13.7 billion under the U.S. Clean Water Act, down from the $18 billion sought by the Justice Department. The decision by Judge Carl Barbier surprised analysts following the case, coming days before BP is set to appear in his court for a related trial on how much it should pay for each barrel spilled. That tranche of the complex case, which begins on Tuesday, will determine the total fine under the Clean Water Act. Thursday’s decision narrows the range of penalties BP could face, which could make a settlement […]

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Ocean Life Faces Mass Extinction, Broad Study Says

Carl Zimmer A team of scientists, in a groundbreaking analysis of data from hundreds of sources, has concluded that humans are on the verge of causing unprecedented damage to the oceans and the animals living in them. “We may be sitting on a precipice of a major extinction event,” said Douglas J. McCauley, an ecologist at the University of California, Santa Barbara, and an author of the new research, which was published on Thursday in the journal Science . But there is still time to avert catastrophe, Dr. McCauley and his colleagues also found. Compared with the continents, the oceans are mostly intact, still wild enough to bounce back to ecological health. “We’re lucky in many ways,” said Malin L. Pinsky, a marine biologist at Rutgers University and another author of the new report. “The impacts are accelerating, but they’re not so bad we can’t reverse them.” Scientific assessments […]

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Scientists: Human activity has pushed Earth beyond four of nine ‘planetary boundaries’

Clmate change: A severe drought plagued a third of Queensland, Australia in 2013. Destabilizing the global environment could make Earth less hospitable for humans. (David Gray/Reuters) At the rate things are going, the Earth in the coming decades could cease to be a “safe operating space” for human beings. That is the conclusion of a new paper published Thursday in the journal Science by 18 researchers trying to gauge the breaking points in the natural world. The paper contends that we have already crossed four “planetary boundaries.” They include the extinction rate; deforestation; the level of carbon dioxide in the atmosphere; and the flow of nitrogen and phosphorous (used on land as fertilizer) into the ocean. “What the science has shown is that human activities — economic growth, technology, consumption – are destabilizing the global environment,” said Will Steffen, who holds appointments at the Australian National University and the […]

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Fossil Fuel Use is Limited by Climate, if Not by Resources

We appear to be in rather peculiar and unsettling times. A year ago, conversations and fears were over the high oil price, which until September 2014, had been above $100 a barrel . Since a high of $115 in July 2014, it has plummeted, with West Texas Intermediate falling to $43 and North Sea Brent Crude marginally higher at $47 earlier in the week. Today, both have rallied to around $48, with an untypical mere 21 cents between them. Since Brent normally trades at least several dollars above WTI, any apparent synchrony of the two often reflects price-volatility, as indeed is the case now. It is fair to say that the crash in oil price was not anticipated by most people who keep an eye on the oil supply situation, and accordingly, its cause is a matter of intense speculation, with the future prognosis even more so. Among the […]

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Oil Continues to Slide After Brief Rally

By Georgi Kantchev Oil prices resumed their slide Thursday after rallying overnight on what market participants attributed to bargain-hunting rather than a change in fundamentals. The global oil market is experiencing a toxic combination of oversupply of crude and tepid demand that has driven prices off a cliff since last summer. Brent, the global benchmark, is down close to 60% since a peak in June. On Thursday, February-dated Brent crude fell 2.9% to $47.28 a barrel on London’s ICE Futures exchange. On the New York Mercantile Exchange, WTI futures traded down 1.9% at $47.57 a barrel. Futures jumped more than 5% late on Wednesday. Analysts attributed the rally to some buyers moving in at low price levels as oil was flirting with $45 a barrel. "Yesterday’s price jump is likely to have been merely a technical countermovement," Commerzbank said in a note. "It is too early for any genuine […]

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Increased U.S. Output Bolsters Oil Glut Fears Sending Prices Back Down

Oil resumed its decline after the biggest gain since June 2012 as U.S. crude production increased, adding to signs that the global supply glut that has pushed prices to a 5 1/2-year low will persist. West Texas Intermediate futures dropped as much as 2.7 percent in New York . U.S. output surged to 9.19 million barrels a day last week, the fastest pace in weekly records dating back to January 1983, the Energy Information Administration reported yesterday. WTI is trading at a premium to European benchmark Brent, having been at a discount since July 2013. OPEC will release its monthly report with supply and demand forecasts for 2015 today. Oil slumped almost 50 percent last year, the most since the 2008 financial crisis, as the Organization of Petroleum Exporting Countries resisted cutting output even amid the U.S. shale boom, exacerbating a surplus estimated by Kuwait at 1.8 million barrels […]

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Oil prices retreat again as Iraq schedules record exports

LONDON (Reuters) – Oil prices resumed their move downwards on Thursday, as Iraq planned a further jump in exports for February, with both Brent and U.S. crude oil dropping around $1 toward near six-year lows, and almost wiping out gains made the previous day. "A war for output market share means oil prices are skewed to the downside. Funds are unwinding a large positive investment premium, but further selling is possible," ANZ said on Thursday. Brent crude oil was down $1.48 at $47.21 a barrel at 1007 GMT, at a discount to U.S. crude, which was trading at $47.60 a barrel, down 88 cents. Iraq plans to boost monthly crude oil exports from its southern ports to a record high level in February, trade sources said on Thursday. Iraq’s State Oil Marketing Organization has allocated 3.3 million barrels per day (bpd) of Basra crude to be shipped out in […]

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Market expectations of oil price uncertainty have increased in recent months

Source: U.S. Energy Information Administration, Short-Term Energy Outlook , January 2015 Note: Confidence interval derived from options market information for the five trading days ending Jan. 8, 2015. Intervals not calculated for months with sparse trading in near-the-money options contracts. December was the sixth consecutive month in which monthly average Brent crude oil prices decreased, falling $17/barrel (bbl) from November to a monthly average of $62/bbl, the lowest since May 2009. The December price decline, and its continuation into early January, reflects continued growth in U.S. tight oil production, strong global supply, and weakening outlooks for the global economy and oil demand growth. As oil prices have sharply declined, market expectations of uncertainty in the price outlook have increased as reflected in the current values of futures and options contracts. West Texas Intermediate (WTI) futures contracts for April 2015 delivery, traded during the five-day period ending January 8, averaged […]

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Oil markets tread water after World Bank report

Oil prices holding steady as markets weigh economic data. Photo by John Angelillo/UPI WASHINGTON, Jan. 14 (UPI) — Crude oil markets were treading water early in the Wednesday session after the World Bank said global economic growth was lower than expected. The prices for Brent and West Texas Intermediate were holding steady early in the Wednesday session to trade at $46.64 per barrel and $46.02 per barrel, respectively. Markets have been in a free fall for much of the week, with Brent holding below the $50 mark for three consecutive days, the lowest price in roughly five years. Oil prices are at the point where international energy companies and those in the secondary sector are trimming jobs and spending in an effort to cope with weak market conditions. The World Bank in a report Tuesday said overall economic growth last year was lower than expected . Behind the numbers, […]

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Oil-at-Sea Storage Seen Raising Rates to Six-Year High

Supertanker owners from Tokyo to Athens said demand to store oil on vessels is strengthening, with Morgan Stanley and Evercore Partners Inc. predicting the highest shipping rates in six-years are possible. Frontline Ltd., Nippon Yusen Kaisha and Dynacom Tankers Management Ltd., who control 11 percent of the fleet, said orders are multiplying as the global oil glut expands. Brent crude plunged 60 percent since June amid signs OPEC nations are unwilling to tackle a global oversupply they say was caused by U.S. drillers and other producers. The price of oil for delivery at later dates is so far above current costs, a market structure known as contango, that it can be profitable to store cargoes and lock in returns now in the futures market. “This is going to tighten the market and make the entire market move higher,” Fotis Giannakoulis, an analyst at Morgan Stanley in New York , […]

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Exclusive: U.S. lawmakers push ahead on Iran sanctions – senior senator

WASHINGTON (Reuters) – Republican and Democratic U.S. lawmakers will press ahead with a plan for more sanctions on Iran, the chairman of the Senate Foreign Relations Committee said on Wednesday, despite White House warnings that they risked derailing nuclear talks. Lawmakers, who say they fear Obama administration negotiators may not take a hard enough line with Tehran, are also at work on a separate bill to have Congress approve any final agreement on Iran’s nuclear program, Senator Bob Corker, the chairman, told Reuters in an interview. "There’s continual efforts to try to figure out a way for Congress to play a role to strengthen whatever final deal may occur," the Tennessee Republican senator said. Republican Senator Mark Kirk and Democratic Senator Robert Menendez are finalizing a bill for tougher sanctions on Iran if there is no final nuclear deal by June 30. The Senate Banking Committee is due to […]

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Iran’s Budget Assumes $40 Oil After Prices Decline 33%

Iran , its oil exports curbed by sanctions, is lowering the crude price for this year’s budget to $40 a barrel as the energy slump affects governments and industry. The government is revising its draft budget to assume a base price of $40, from $72, the state-run Fars News Agency reported Finance and Economy Minister Ali Tayebnia as saying today. The minister said some projects will have to be halted, according to Fars. The Iranian calendar year begins March 21. Brent, a pricing benchmark for more than half the world’s oil, fell 18 percent this year after tumbling 48 percent last year. Qatar Petroleum and Royal Dutch Shell Plc yesterday called off plans to build a $6.5 billion petrochemical plant in the emirate in response to lower oil prices. Brent crude futures fell 2.9 percent to $47.28 a barrel at 2:27 p.m. in Dubai. Iran, OPEC’s fourth-largest producer, budgeted […]

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Iraq to Double Exports of Kirkuk Crude Amid Oil Surplus

Iraq will double exports within weeks from its northern Kirkuk oil fields and continue boosting output further south amid a global market glut that’s pushed prices to their lowest level in more than five and a half years. Crude shipments will rise to 300,000 barrels a day from the Kirkuk oil hub, where authorities are also upgrading pipelines between fields, Fouad Hussein, a member of the Kirkuk provincial council’s oil and gas committee, said yesterday in a phone interview. “There is a need to install a new pipeline network” to increase exports from the area, Hussein said. Kirkuk, which currently exports about 150,000 barrels a day, will boost shipments to 250,000 barrels a day and then to 300,000 “in the coming few weeks,” he said. Iraq, holder of the world’s fifth-largest crude reserves, is rebuilding its energy industry after decades of wars and economic sanctions. The country exported 2.94 […]

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Qatar, Shell Scrap $6.5 Billion Project Amid Oil Collapse

Qatar Petroleum and Royal Dutch Shell Plc (RDSA) called off plans to build a $6.5 billion petrochemical plant in the emirate, saying the project is no longer commercially feasible amid the upheaval in global energy markets. The companies formed a partnership for the al-Karaana project in 2011 and planned to operate it as a joint venture, with state-run QP owning 80 percent and Shell the remaining 20 percent. They decided not to proceed after evaluating quotations from bidders for engineering and construction work, the companies said today in a joint statement. The expected capital cost of the petrochemical complex planned in Ras Laffan industrial city “has rendered it commercially unfeasible, particularly in the current economic climate prevailing in the energy industry ,” they said. Al-Karaana is the second petrochemical project in Qatar to be canceled in recent months due to unfavorable economics. Industries Qatar, the state-controlled petrochemical and steel […]

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China’s First Advanced Nuclear Reactor Faces More Delays

BEIJING—China’s ambitions to be a leader in nuclear technology have been dealt a fresh blow, as construction of its most advanced reactor is facing a new delay. The project—which China is developing with Westinghouse Electric Co. of the U.S.—faces new development problems and now isn’t expected to start up until 2016 at the earliest, the chief engineer at China’s state-owned reactor technology company said Thursday. “We discovered some new problems during tests so we need to delay it more until next year,” Wang Zhongtang, chief engineer of China’s State Nuclear Power Technology Corp., said on the sidelines of an industry conference. Mr. Wang didn’t specify the nature of the latest problems found at ongoing trials for the reactor, nor did he provide a more precise time frame for its launch. The delay is the second for the project, which had been slated to start by the end of 2013. […]

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China to set gas-fired power tariffs against natural gas prices

Singapore (Platts)–15Jan2015/357 am EST/857 GMT China has announced a plan to link electricity tariffs for natural-gas-fired power plants with gas prices, in a bid to help operators cope with fuel costs. The National Development and Reform Commission announced on Wednesday that it will introduce benchmark electricity tariffs for new gas-fired power plants as well as gas-fired plants used for peak shaving, with the tariffs to be set by each province. Local governments will take into account the cost of gas-fired power generation as well as affordability of customers in making their pricing decisions. Existing gas-fired power plants will gradually adopt the new pricing structure, the commission said. Article continues below… International Gas Report is a biweekly report that intelligently analyzes what is happening in the natural gas industry, improving your vision and sharpening your competitive edge. Through its unrivalled network of global correspondents, it covers the whole gas chain, […]

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Bakken LTO Production, November Data

The North Dakota Industrial Commission is out with the Bakken November Production Data and the North Dakota Production Data . Bakken bpd Bakken production was up 5,293 BP/D while total North Dakota was up 3,691 BP/D. Total North Dakota oil production is up 901 barrels per day from two months ago, October production. Bakken Wells Total wells producing was up by 110 in the Bakken but only up by 63 in North Dakota. That means a lot of conventional wells were shut down. From the Director’s Cut : Oct Sweet Crude Price = $68.94/barrel Nov Sweet Crude Price = $60.61/barrel Dec Sweet Crude Price = $40.74/barrel Today Sweet Crude Price = $29.25/barrel (lowest since December 2008) (all-time high was $136.29 7/3/2008) Oct rig count 191 Nov rig count 188 Dec rig count 181 Today’s rig count is 156 (lowest since Oct 2010)(all-time high was 218 on 5/29/2012) The statewide […]

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U.S. Crude Production Advances Even as Prices Decline

Drillers that unlocked the shale oil boom in the U.S. are finding it hard to shut off the nozzle. U.S. crude production rose even as prices slumped to the lowest in more than five years and the number of rigs targeting oil decreased. In North Dakota’s prolific Bakken shale formation, output rose in November as the number of new wells coming online fell by 73 percent. The increases illustrate how improvements in horizontal drilling and hydraulic fracturing technology may prop up U.S. crude production even as companies cut spending, idle rigs and lay off thousands of workers with oil prices down more than 50 percent since June. “We have an oversupply of crude,” Michael Hiley, head of energy OTC at LPS Partners Inc. in New York , said yesterday. “Production keeps going up. There is not a great correlation between the rig count and production because drilling has gotten […]

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Oceana: Wind better than drilling in Atlantic

Advocacy group Oceana says wind energy developments in the Atlantic would bring more benefits than offshore drilling. Photo by Teun van den Dries/Shutterstock WASHINGTON, Jan. 14 (UPI) — A U.S. ocean advocacy group said an offshore wind sector in the Atlantic Ocean could produce twice as many jobs and twice as much energy as offshore drilling. "The American public deserves to know the facts when it comes to expanding this dirty and dangerous practice to the East Coast, and what alternatives there are for clean energy generation," Andrew Menaquale, an energy analyst at advocacy group Oceana, said in a Wednesday statement. The National Ocean Industries Association, an industry group lobbying for more offshore work, said about 1.34 million barrels of oil equivalent per day could be produced from the Atlantic basin by 2035. Oceana instead found an offshore wind energy sector in the Atlantic could produce more energy than […]

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No change in oil export policy, White House says

White House Press Secretary Josh Earnest says there’s been no change in federal policies regarding the export of domestically produced crude oil. UPI/Kevin Dietsch WASHINGTON, Jan. 14 (UPI) — There has been no change in U.S. policy regarding the export of domestically produced crude oil, the president’s spokesman said. U.S. Energy Information Administration Administrator Adam Sieminski said that, while low crude oil prices are slowing the rate at which domestic oil production is increasing, exploration and production activity is still accelerating at a record pace. "Drilling activity is expected to increase and U.S. production should rise in 2016 to its second highest daily output level since record production was set in 1970," he said in a statement tied to the release of a short-term market report . Most of the increase in U.S. oil production is coming from shale basins in the Lower 48 states and some of that […]

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Halliburton latest to pull back in weak market

Oil services company Halliburton latest to feel the squeeze of a weakening energy market. UPI/Shutterstock/Calin Tatu HOUSTON, Jan. 14 (UPI) — Oil services company Halliburton said it was making staff reductions at its Houston headquarters in an effort to adjust to rough market conditions. International energy companies during the fourth quarter started announcing cuts in capital expenditures as oil prices continued to shed value. More recently, secondary industries have started to show signs of a slowdown. Halliburton spokeswoman Emily Mir told Fuel Fix, the energy blog for the Houston Chronicle, the company was monitoring capital flow and cutting jobs in an effort to cope. "While these reductions are difficult, we believe they are necessary to work through this challenging market," she said in remarks published Tuesday. Layoffs from the Houston office follow a December announcement from the company it was cutting about 1,000 jobs from its operations in the […]

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North Dakota’s Oil Production Rises to New Record

North Dakota oil production rose to a record in November, even as energy companies drilled fewer wells and the rig count dropped to a near five-year low, state officials said. Energy companies in North Dakota’s prolific Bakken formation are dialing back how much they spend on exploring for new oil deposits because crude prices are languishing. But there is more oil flowing from fewer wells as companies tap only their most promising and profitable reserves. Oil output across the state hit a record 1.19 million barrels a day in November, the most recent month available, according to data released Wednesday by the state’s Department of Mineral Resources. North Dakota is the second-largest U.S. crude producer behind Texas, but the drop in oil prices over the last six months from more than $100 a barrel to less than $50 has spurred a rapid decline in the number of rigs drilling […]

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Fed’s Beige Book: Continued Growth, but Some Slowing in Oil-Producing Areas

ENLARGE The U.S. Federal Reserve, housed in Washington’s Federal Reserve Board building, Wednesday released its ‘beige book’ report on regional economic conditions. Gary Cameron/Reuters Energy-rich regions of the U.S. are seeing signs of slower growth due to the plunge in oil prices, though the national economy continued to expand in late 2014, the Federal Reserve said in its latest survey of regional economic conditions. The Fed found “modest” or “moderate” growth across most of its 12 districts in mid-November through late December, according to the “beige book” report released Wednesday. Payrolls “expanded moderately” across “a variety of sectors,” the report said, though pay remained stagnant for most workers. “Significant wage pressures were largely limited to workers with specialized technical skills,” it said. In areas where energy production has boomed in recent years, the sharp decline in oil prices since mid-2014 is generating worries about a slowdown. The Dallas district […]

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EPA Set to Regulate Oil and Gas Methane Emissions

ENLARGE In this June 12, 2014 file photo, oil pumps and natural gas burn off in Watford City, N.D. Associated Press WASHINGTON—The Obama administration unveiled plans Wednesday to regulate methane emissions from the nation’s oil and natural-gas industry for the first time, a move aimed at meeting climate-change goals while not hampering the nation’s energy boom. The Environmental Protection Agency plans to propose federal regulations to cut methane emissions from the oil and gas sector by 40% to 45% over the next decade from 2012 levels, White House and agency officials said Wednesday. The rules, scheduled to be proposed this summer and completed by 2016, would apply only to new or modified sites. For existing oil and gas operations, the EPA is set to rely mostly on voluntary measures to cut methane, a move backed by the industry. To reduce emissions, companies would have to install technology that prevents […]

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Fed: Oil Price Drops Bring Pain To Texas, North Dakota

URL: http://www.rigzone.com/news/oil_gas/a/136762/Fed_Oil_Price_Drops_Bring_Pain_To_Texas_North_Dakota WASHINGTON, Jan 14 (Reuters) – A plunge in energy prices is hitting America’s oil and gas producers, leading some firms to lay off workers while others struggle to get loans, the Federal Reserve said on Wednesday. A wide range of policymakers, investors and economists think cheaper oil overall will benefit the U.S. economy, principally by letting households spend more money on other things. The Fed’s monthly Beige Book report on business activity had some evidence of this economic boost, with firms telling the Fed that lower gasoline prices helped holiday sales in the Chicago district and led people to buy bigger cars in the Atlanta district. But the Fed also gave a litany of examples of the pain that has come with the more than 50 percent drop in oil prices since mid-June. Compared to a month earlier, oil and gas exploration decreased in North Dakota, the […]

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Oil, Gas Managers Scale Back Hiring Plans in 2015

URL: http://www.rigzone.com/news/oil_gas/a/136761/Oil_Gas_Managers_Scale_Back_Hiring_Plans_in_2015 A recent Rigzone survey paints a picture of ambiguity for oil and gas professionals in the year ahead, a steep change from survey results just six months prior. Amidst declining oil prices and uncertainty with the current economic environment, four in ten (44%) U.S. hiring managers in oil and gas anticipate less hiring in the first half of the year compared to the second half of 2014, according to Rigzone’s semi-annual hiring survey. Nearly a quarter (22%) expect more hiring and only five percent intend to not hire at all in the next six months. The survey results paint a picture of ambiguity for oil and gas professionals in the year ahead, a steep change from survey results just six months prior when half of hiring managers planned to hire more. In fact, 48 percent of hiring managers said they’ve experienced a loss of budgeted positions due […]

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Drillers Say Obama Plan to Plug Methane Leaks Imperils Oil Boom

The Obama administration said it will issue rules to cut leaks of climate-warming methane, a step the oil and gas industry warned could choke the U.S. energy renaissance fueled by hydraulic fracturing. The U.S. Environmental Protection Agency said Wednesday it will propose rules later this year targeting new oil-and-gas equipment, aiming to cut emissions 40 percent to 45 percent by 2025. It also will expand voluntary programs with states and industry on equipment already in use, a move that falls short of the new mandates environmentalists sought. “We are outlining a comprehensive set of steps that will have a positive effect on the climate, on the economy and on public health,” Dan Utech, the top White House adviser on climate and energy, said on a conference call with reporters. By 2025, the efforts will reduce gas leaks enough to heat 2 million homes a year, he said. The announcement […]

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Russian bank tests economy at lowered oil price

Economy continues to falter in low oil price environment under Russian President Vladimir Putin. (UPI /Omar Rashidi) MOSCOW, Jan. 15 (UPI) — Oil priced at $40 per barrel is the benchmark against which the Russian economy is weighed in a new forecast, a Russian central bank official said. The Bank of Russia revised its worst-case scenario from oil priced below the $60 per barrel mark. A revised stress test puts oil at a further discount. "The $40-per-barrel [scenario] is among likely scenarios that we are looking at," First Deputy Chair Xenia Yuadaeva said Wednesday. Russia’s economy is strained by dual pressures from Western sanctions imposed after the annexation of the Crimean Peninsula and the low price of oil, down more than $50 per barrel from June 2014. The Russian currency continues to trade at historic lows, valued at 64 per U.S. dollar in current trading. The Russian bank in […]

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BP cuts 200 staff, 100 contractors as oil prices fall

LONDON (AP) — BP has announced it will cut an estimated 200 staff jobs and another 100 contracting jobs in light of falling oil prices. The company said Thursday the cuts will be made in onshore roles, not in offshore operational positions. Regional president Trevor Garlick said BP remains committed to its North Sea operations but needs to take "specific steps" given the challenging economic environment. He cited toughening market conditions as a reason for the cuts. Union officials fear other oil-related jobs will be cut by other firms soon as prices continue to soften. The price for the benchmark U.S. crude oil is down about 41 percent in the past three months amid oversupply.

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Tullow Oil Cuts Exploration Budget

ENLARGE Oil exploration companies, such as Tullow Oil, don’t have other parts of their business to fall back on when oil prices fall. Bloomberg News LONDON— Tullow Oil PLC Thursday said it was making its largest ever write off of $2.7 billion before tax, mostly resulting from unsuccessful exploration programs and the drop in value of licenses, discoveries and assets resulting from the plunge in oil prices . The write offs include a decrease in value of $600 million across all of Tullow’s assets, including producing oil fields, oil in the ground and equipment. They also include $1.2 billion related to discoveries in previous years that now have no prospect of commercialization amid the weaker oil prices and unsuccessful exploration drilling. The price of oil has more than halved in the past six months, hitting the exploration and production sector hard. Unlike the major oil companies BP PLC and […]

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BP poised for job cuts in North Sea arm

Anchor handling of Semi submergible in North Sea BP has told staff in Aberdeen it is cutting 300 jobs in its North Sea business, under a wide-ranging cost-cutting plan announced in December. The UK-based oil major has outlined plans to cut the roles from its 3,500-strong North Sea business, based in Scotland, over the course of 2015. More On this story On this topic IN Oil & Gas The cuts include 200 onshore staff directly employed by BP and 100 contractors. Trevor Garlick, regional president for BP North Sea, said: “We are committed to the North Sea and see a long term future for our business here. However, given the well-documented challenges of operating in this maturing region and in toughening market conditions, we are taking specific steps to ensure our business remains competitive and robust, and we are aligning with the wider industry.” “Whilst our primary focus will […]

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The Good, Bad, and Ugly of Plunging Oil Prices

Crude oil prices plunged to a six-year low Tuesday in a potentially painful threat to oil-exporting nations that rely on crude to power their economies. The drop brings some welcome relief to countries that have been struggling with economic headwinds, but brings a mixed bag for others, like the United States, that are both big producers and consumers of oil. Oil prices are still looking for a floor, in part because the persistent mismatch between global supply and demand continues even as big oil producers inside OPEC keep spooking the market by refusing to countenance any voluntary production cut. The energy minister for the United Arab Emirates on Tuesday, Jan. 13, dismissed the idea that OPEC would cut production to boost prices and said it was up to other oil suppliers, such as the United States, to blink first. “Those who are producing the most expensive oil — the […]

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Abolish the Gas Tax

Gas prices in Corpus Christi, Texas AP Photo/Corpus Christi Caller-Times Tumbling energy prices are the first lucky break for U.S. consumers in years, but Washington is feeling left out. So the gougers of both parties are joining to steal some of the proceeds with the first gasoline tax hike in more than two decades. The federal gas tax is now 18.4 cents a gallon and the logic seems to be that motorists won’t notice an extra dime or more since gas prices are down 40% on average from the 2014 peak. Congress can then “invest” the windfall in roads, bridges and other projects. A convenient pretext for a tax increase arrives in May with the expiration of a temporary highway funding bill, and many otherwise intelligent Republicans are open to the idea, perhaps as a tax swap. *** Now here is a formula for popularity that only a lobbyist […]

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Oil Extends Drop From 5 1/2-Year Low as Surplus Seen Persisting

Oil fell in New York and London , extending losses from the lowest close in more than five and a half years as OPEC nations predicted the global surplus will persist and U.S. stockpiles were forecast to rise. Futures dropped as much as 1.9 percent in New York. Crude stockpiles in the U.S. probably expanded further above seasonal levels last week, a Bloomberg News survey showed before a government report today. Prices may recover only when demand improves later this year, Ali Al Yabhouni, the United Arab Emirates ’ governor to OPEC, said yesterday. Oil slumped almost 50 percent last year, the most since the 2008 financial crisis, as the Organization of Petroleum Exporting Countries resisted calls to cut production even as the U.S. pumped at the fastest rate in more than three decades. WTI briefly traded higher than Brent yesterday for the first time since July 2013, a […]

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Oil prices extend slide in commodities sell-off

SINGAPORE (Reuters) – Oil prices fell more than 1 percent on Wednesday after touching their lowest in nearly six years the previous session, extending losses alongside a sell-off in other commodities. Commodities came under pressure after the World Bank cut its forecasts for global growth, reinforcing worries of a gloomy economic outlook at a time when oil markets are plagued by oversupply. "There’s clearly a souring of sentiment towards industrial commodities and I think that’s spilling over to oil today," said Michael McCarthy, chief strategist at CMC Markets in Sydney. February Brent crude LCOc1 had dropped 49 cents to $46.10 a barrel by 0509 GMT and West Texas Intermediate crude for February CLc1 was at $45.38, down 52 cents. Copper plunged to 5-1/2 year lows, while gold struggled to hold near a 12-week high on Wednesday. "It’s unusual to see the so-called safe-haven assets moving down with industrial commodities," […]

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Oil rout takes Brent to near six-year low

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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WTI Crude Oil Surpasses Brent for First Time Since 2013

West Texas Intermediate oil became more expensive than Brent for the first time in 1 1/2 years amid a weak European economy and signs that U.S. crude export controls will loosen. WTI traded higher than Brent today for the first time since July 2013, based on February intraday prices. It averaged $6.64 less than Brent last year, and traded as much as $15.45 lower than its European counterpart on Jan. 13, 2014. Oil demand in Europe will average 13.42 million barrels a day this year, down from 13.47 million in 2014, the International Energy Agency forecast last month. Opinion polls showed Greek Prime Minister Antonis Samaras hasn’t narrowed the lead by his top opponent from the Syriza party, boosting concerns that a change in political leadership will spur an exit from the euro area. “There are two key reasons for the rapid close of the Brent-WTI spread, with the […]

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WTI Crude Oil Surpasses Brent for First Time Since 2013

West Texas Intermediate oil became more expensive than Brent for the first time in 1 1/2 years amid a weak European economy and signs that U.S. crude export controls will loosen. WTI traded higher than Brent today for the first time since July 2013, based on February intraday prices. It averaged $6.64 less than Brent last year, and traded as much as $15.45 lower than its European counterpart on Jan. 13, 2014. Oil demand in Europe will average 13.42 million barrels a day this year, down from 13.47 million in 2014, the International Energy Agency forecast last month. Opinion polls showed Greek Prime Minister Antonis Samaras hasn’t narrowed the lead by his top opponent from the Syriza party, boosting concerns that a change in political leadership will spur an exit from the euro area. “There are two key reasons for the rapid close of the Brent-WTI spread, with the […]

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Natural Gas Bounces as Weather Forecast Grows Slightly Colder

By Timothy Puko Natural gas prices are rebounding slightly Tuesday as traders appear unwilling to keep selling at prices below $2.80 with two months of winter still to go. Natural gas for February delivery is 6.5 cents, or 2.3% higher, at $2.86 a million British thermal units on the New York Mercantile Exchange. Prices have now bounced five times this month, and each time they have dropped near $2.80/mmBtu. Weather forecasts encouraged Tuesday’s buying, analysts and a broker said. Half of U.S. homes use natural gas heat, and above-normal temperatures throughout December have cut demand, taking down the market at a time it usually peaks. Next week’s forecasts, while they are warmer-than normal, cooled in overnight updates, raising expectations for gas heating demand. With more than two months left for official winter heating season, traders have to be aware that weather can still turn severe and drive a spike […]

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Oil prices down again as UAE defends holding production

LONDON (Reuters) – Brent and U.S. WTI crude oil prices fell to their lowest levels in almost six years on Tuesday as a big OPEC producer stood by the group’s decision not to cut output to tackle a glut in the market. Oil prices have fallen 60 percent from their June 2014 peaks, driven down by rising production, particularly U.S. shale oil, and weaker-than-expected demand in Europe and Asia. Rather than cutting output to try to balance the market, producers from the Organization of the Petroleum Exporting Countries (OPEC) are offering discounts to customers in an attempt to defend market share. At 1032 GMT, February Brent crude was down $1.06 at $46.37 a barrel, after dipping to $45.23, its lowest since March 2009. U.S. crude for February was down $1.15 at $44.92 per barrel, off an intraday low of $44.21. "The market is in a bit of a panic […]

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Oil Recovery Seen by Kuwait to U.A.E. After Lower Prices

Oil oversupply that sent prices to a five-year low probably will persist until at least the second half when demand is set to recover, according to Kuwait ’s oil minister and the OPEC governor of the United Arab Emirates . Faster global economic growth will be needed to help absorb the oil surplus estimated at 1.8 million barrels a day, Kuwait Oil Minister Ali Al-Omair told reporters in parliament yesterday. A demand-led recovery is seen in the second half, the U.A.E.’s Governor to OPEC Ali Al Yabhouni told reporters in Abu Dhabi. Oil fell about 40 percent since the Organization of Petroleum Exporting Countries chose to maintain its production target at a Nov. 27 meeting, seeking to defend market share rather than prices. The U.A.E. and Kuwait are OPEC members. Slowing economic growth has contributed to the drop in prices, Al-Omair said. “We are expecting that this situation will […]

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Oil at $40, and Below, Gaining Traction on Wall Street

Brace for $40-a-barrel oil. The U.S. benchmark crude price, down more than $60 since June to below $45 yesterday, is on the way to this next threshold, said Societe Generale SA and Bank of America Corp. And Goldman Sachs Group Inc. says that West Texas Intermediate needs to remain near $40 during the first half to deter investment in new supplies that would add to the glut. “The markets are continuing to price in huge oversupply in the first half of 2015,” Mike Wittner , head of research at Societe Generale SA in New York , said by phone on Jan. 12. “We’re going to go below $40.” Oil is seeking a “new equilibrium” as the Organization of Petroleum Exporting Countries abandons its role of keeping supply and demand aligned, according to Goldman. Prices are poised to drop further, testing the ability of U.S. shale drillers to keep pumping. […]

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