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China April home prices fuel hopes of bottoming out, but long road to recovery

HONG KONG China’s new home prices fell for the eighth consecutive month in April from a year earlier but were flat from March, adding to hopes that a property downturn which is weighing heavily on the economy is beginning to bottom out. But analysts warned any recovery in the market will take some time given a huge inventory of unsold homes, and said the property sector remains the biggest risk to the world’s second-largest economy, which looks set for its worst year in 25 years. That will keep pressure on policymakers to roll out more interest rate cuts and other stimulus measures later this year to boost activity. Average new home prices in China’s 70 major cities dropped 6.1 percent last month from a year ago, the same rate of decline as in March, according to Reuters calculations based on official data published on Monday. But nationwide prices steadied […]

Posted On : Published By : Tom Whipple
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Oil Investors Take a Closer Look at Production

ENLARGE A spotlight has landed on a previously overlooked metric as oil traders drill deeper for clues on price movement. More often, investors are looking to weekly U.S. oil-production data from the U.S. Energy Information Administration for signs the global glut of crude that sunk prices last year is starting to shrink. That data point, however, has some significant, well-known limitations, and some analysts say traders are giving too much credence to it. The EIA’s weekly production data are largely based on a forecasting model, not reported output. And the week-to-week changes are often too small to be a reliable indicator of whether production is rising or falling, according to the EIA. Still, on April 1, when the EIA report showed the first weekly production decline since January, the U.S. oil price surged by 5.2% to settle above $50 a barrel, even though the same report showed domestic crude […]

Posted On : Published By : Tom Whipple
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Bakken by County and Legacy Decline

North Dakota publishes Historical Oil Production by County . However confidential wells are not included in these totals. But they also publish a State Summary Report  which does include confidential well data for the previous two months. Working with both we can get a pretty good estimate of production from each county. McKenzie had  a 12,533 bp/d gain in March but they are still 32,447 below their December high. Mountrail peaked back in September 2014 and dropped another 9,467 bp/d in March. Mountrail dropped the most in October when the Bakken rig count averaged 191 and WTI averaged in the mid $80s. Once North Dakota’s largest producer, I don’t think there is any question that Mountrail has peaked. Dunn had a big increase of 10,884 bp/d in March and surpassed its previous peak in September. Williams was down by just over 1,000 bp/d in March. North Dakota outside the […]

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U.S. gas prices up 22 cents over past three weeks: survey

The average price of a gallon of regular-grade gasoline in the United States rose 22 cents over the past three weeks to $2.82, according to a Lundberg survey released on Sunday. The average price per gallon, which has now jumped 35 cents since April 10, is the highest seen by the survey since late November, but is still nearly 93 cents lower than a year ago. Rises in crude oil prices over the three-week period were not driven by changes in oil supplies, said Trilby Lundberg, publisher of the survey, but rather were caused by a recent weakening of the dollar against key foreign currencies. Prices should remain relatively low for the coming summer driving season. "The chances are high that there will be small or negligible price rises from here in the national average, assuming no crude oil price spike in the near future," Lundberg said. The price […]

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Heinberg paints a bleak picture of an inevitable post-carbon future

Very slowly, environmentalists have begun to convince the world we can have our cake and eat it too. They argue human civilization can transition away from fossil fuels without suffering a significant blow to the global economy. Capitalism, continual growth, and high standards of living can all continue, and continue without the onset of catastrophic climate change. We can transition to renewable sources of energy such as solar, wind, and hydro—which, in recent years, have become substantially more economically viable. And that allow us save the planet while continuing to update to the latest iPhone each year and without forgoing the annual vacations in Hawaii. But Richard Heinberg argues this optimistic future is a fantasy. It is absolutely imperative that the world does move away from fossil fuels, he maintains. But it is not going to happen without severe economic sacrifice, political upheaval, and a “simplification and decentralization of […]

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Shell’s Arctic voyage marks beginning of peak oil era

World will need to repeat US shale revolution to meet future oil demand Even though the current weakness in oil prices below $100 per barrel has been caused by a glut in global supply this will be short lived. Most of the new oil has come from three sources, US shale, Iraq and Africa. Each has its own problems going forward that will limit its potential to deliver the incremental increases in supply that will be required to meet even the most pessimistic forecasts for demand by 2040. In the case of US shale this oil already represents the bottom of the barrel. Lower prices mean that US output will plateau this year at around 9.3m bpd as oil companies shut down rigs at a record rate. However, even when these rigs eventually return once prices recover, as they have since March, it is unlikely that America’s oil output […]

Posted On : Published By : Tom Whipple
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Oil heads for weekly gain, shrugs off ample supply; U.S. output eyed

SINGAPORE Oil prices were little changed on Friday but were set to end the week slightly higher, buoyed by a weaker dollar and forecasts for lower growth in U.S. crude output. U.S. crude is set to rise for a ninth week, which would be the benchmark’s longest winning streak since 1983. U.S. crude stockpiles have fallen from record levels, while the government has trimmed forecasts for crude output growth in 2015 and 2016. June West Texas Intermediate futures were down 6 cents at $59.82 a barrel as of 0631 GMT. July Brent crude rose 3 cents to $66.73 a barrel. Front-month Brent is on track for a weekly gain after a 1.6 percent decline last week interrupted its month-long rally. But analysts said prices have outperformed weak oil fundamentals. Supply continues to exceed demand growth, which has been curbed by a lackluster global economy. "Recent price action across a […]

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U.S. Oil Prices Fall But Eke Out Weekly Gain

May 15, 2015 4:25 p.m. ET By Nicole Friedman U.S. oil prices fell for a third straight session on Friday, a signal to some in the market that the recent strong rally in crude-oil prices may be petering out. Light, sweet crude for June delivery settled down 19 cents, or 0.3%, to $59.69 a barrel on the New York Mercantile Exchange. Prices rose 0.5% in the week. Brent crude for July delivery, the global benchmark, rose 11 cents, or 0.2%, to $66.81 a barrel on the ICE Futures Europe exchange. The contract rose 1% on the week. Oil prices have climbed off near-six-year lows since March on expectations that spending cutbacks would lead to a drop in U.S. crude-oil production. The number of rigs drilling for oil in the U.S. has plummeted in the past few months, spurring expectations of a decline in output. But U.S. shale-oil companies say […]

Posted On : Published By : Tom Whipple
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Natural Gas Retreats from Rally

By Timothy Puko Natural gas prices are inching back from a nearly three-week rally as investors cash out and insure themselves against a potentially larger retreat. Natural gas for June delivery fell 0.8 cent, or 0.3%, to $3.00 a million British thermal units on the New York Mercantile Exchange. Gas is still just barely in bull-market territory, up more than 20% since April 27 after prices surged to a nearly four-month high Thursday. That has led many investors to pull back Friday, analysts said. Many don’t think that gas has rebalanced from rampant oversupply and that the recent rally is overcooked. Several money managers said they have started selling recently to try to get out at the top of the market. "Prices are overvalued and are currently becoming more susceptible to a downside correction," Dominick Chirichella, analyst at the Energy Management Institute said in a note. Thursday’s surge came […]

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Venezuela says working on OPEC, non-OPEC deal to stabilize prices

CARACAS Venezuela’s president Nicolas Maduro said on Friday the country is working towards a new agreement between OPEC and non-OPEC nations to stabilize oil prices "We’re currently working on a deal that hopefully can materialize in June regarding an announcement between OPEC and some of the most important (oil) producers in the world to finish stabilizing the market in the second half of the year," he said after a meeting with Qatar’s emir. He said it was in the interests of the South American country and OPEC nations to stabilize prices around $100 per barrel in the medium term. (Reporting by Caracas newsroom; Editing by Meredith Mazzilli)

Posted On : Published By : Tom Whipple