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EIA Capitulates Under Cover Of Darkness

Many investors know that when a company wants to mitigate media coverage of bad news, they typically release data on a Friday after the close. Well last Friday, that is exactly what the EIA did, admitting the very thing I and Cornerstone Analytics have been arguing all year: EIA was and still is overstating U.S. production. The amount that they admitted to so far, as of Friday afternoon, was 254,000 barrels per day (b/d) or 1,778,000 barrels per week, 7,112,000 per month or 14,224,000 for June and July alone. This is the most incredible cover up I have ever witnessed in my decade-long investment career and I have not seen one major media outlet even mention it so far. Instead China demand & Iran output are front and center as per prior posts in an attempt to divert attention (I call it moving the goal posts) away from the […]

Posted On : Published By : Tom Whipple
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Oil-and-Gas Debt Deals Sting Investors

It is shaping up as a cruel summer for debt investors wagering on a rebound in the oil-and-gas business. The investments may still hold advantages for the funds, despite the sharp declines in oil-related securities in July. The deals generally were struck at terms advantageous to the funds, including giving some preferred treatment in any restructuring, reflecting the intense cash squeeze on many oil producers late last year. The investments appeared well timed earlier this year, when oil prices rebounded as much as 30% after a deep decline in 2014. July’s commodity tumble—front-month crude futures fell 21% last month and another 4.1% Monday, to $45.17 a barrel—has extended the pain already felt around the sector. Exxon Mobil Corp. XOM -1.45 % and Chevron Corp. CVX -3.25 % said Friday they are both slashing stock-buyback programs, while Linn Energy LINE -18.81 % LLC said last week it planned to stop […]

Posted On : Published By : Tom Whipple
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US Oil Production Finally Starting to Decline

There has been very little data to post about recently and as everyone should know by now, I post primarily about data. So if there is no data there is not much to post about. Also I have been very busy for the a week now and have checked in only a couple of times. A few days ago a very racist post was posted on this blog. I completely overlooked it as I seldom scan the posts because I get an email for every post so I just read the posts in the emails. But when there is a guest post, as the one last week was, I get no emails, the guest poster gets them instead. Anyway I deleted the post and banned the poster. I also banned another poster because he accused me of deliberately letting the post stay up. That outraged me. It was the […]

Posted On : Published By : Tom Whipple
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Cracking Open Re-fracking: A Flush Rush or Idle Probing?

Squirting fluid that made hydraulic fracturing work two years ago down the same old fractured well may not be the surest way to make a buck in an industry eager to turn a profit. Then again, the folks in the lab and in the field might be onto something. The desire to charm hydrocarbons from the ground without the expense of additional drilling is strong and has lingered for decades. Re-fracking has been in practice, with mixed results, on vertical wells for years. It’s only in the last few years that engineers have started returning to the source of all those hydraulically fractured wells with re-fracking. Most estimates indicate it costs $8 million to drill and complete a new well. Re-fracking a well costs about 25 percent of that figure, which is enticing some of the largest oilfield services companies into the lab. But exactly what “best practices” might […]

Posted On : Published By : Tom Whipple
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North Dakota oil activity stable

Rig data show slump endures in North Dakota, though energy companies starting to improve operational efficiency. File Photo by UPI/Shutterstock/ekina BISMARCK, N.D., Aug. 3 (UPI) — The number of rigs actively exploring for or producing oil in North Dakota is holding steady, though data show overall production is rebounding slightly. State data show 74 rigs in active service as of Monday , relatively unchanged from one month ago. North Dakota is the second largest oil producer in the nation and, while diversified, its economy depends in part on the surge of oil taken from shale basins in the state. The North Dakota Industrial Commission reported oil production in May, the last full month for which government data are published, at 1.2 million barrels per day, just shy of the all-time record posted in December 2014. More than 90 percent of the oil produced in North Dakota comes from the […]

Posted On : Published By : Tom Whipple
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‘Perfect Storm’ Engulfing Canada’s Economy Perfectly Predictable

That’s one dark perfect storm. Oil rig photo via Shutterstock. Economists, an irrational tribe of short-sighted mathematicians, are now calling Canada’s declining economic fortunes "a perfect storm." It seems to be the only weather that complex market economies generate these days, or maybe such things are just another face of globalization. In any case, economists now lament that low oil prices have upended the nation’s trade balance: "Canada has posted trade deficits every month this year, and the cumulative 2015 total of $13.6 billion is a record, exceeding the next highest, in 2009, of $2.95 billion." But this unique perfect storm gets darker. China, which Harperites eagerly embraced as the globe’s autocratic growth locomotive , has run out of steam. As the country’s notorious industrial revolution unwinds, China’s stock market has imploded. Communist party cadres are now putting their money in foreign housing markets in places like Vancouver. Throughout […]

Posted On : Published By : ASPO-USA
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Peak oil, Peak gold, Peak everything – coming disaster for everyone

The global financial and political scene is now undergoing a transition that goes largely unnoticed and escapes general comprehension. Many facts and indicators provide mounting evidence that the status of the US dollar as international reserve currency is being seriously threatened by the BRICS economic block and that alternative arrangements for international trade and commerce, planned two or three years ago, are being systematically implemented via the Asia Infrastructure and Investment Bank and the Shanghai Gold Exchange. It might seem puzzling to some why any change would be necessary. The only logical explanation is that the super-elite group of bankers and royal families that secretly control global affairs have come to realize what’s threatening the world’s future prosperity today. Even though governments are not discussing this, statistics that apply the correct accounting and forecasting methods show that we reached peak oil in 2014. Many industry experts contend that 2015 […]

Posted On : Published By : ASPO-USA
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U.S. oil drillers add rigs despite crude prices collapse: Baker Hughes

Stacked rigs are seen along with other idled oil drilling equipment at a depot in Dickinson, North Dakota June 26, 2015. U.S. energy firms added 5 oil rigs this week after putting 21 rigs into service last week, the most in over a year, despite a collapse in U.S. crude prices from recent highs in June, data showed on Friday. That was a sign some drillers followed through on plans to add rigs announced in May and June when U.S. crude futures were averaging $60 a barrel. U.S. crude futures so far this week however have traded around $48.Drillers added oil rigs in two of the four major U.S. shale oil basins, with three in the Permian in West Texas and eastern New Mexico and one in the Bakken in North Dakota and Montana. They cut one rig each in the Eagle Ford in South Texas and the Niobrara […]

Posted On : Published By : Tom Whipple
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U.S. Oil-Rig Count Increases to 664

The number of U.S. oil-drilling rigs, which is a proxy for activity in the oil industry, had fallen sharply since oil prices headed south last year. The rig count had dropped for 29 straight weeks before rising for two weeks and then falling again. Now it has risen for two straight weeks. Oil prices fell nearly 60% from June 2014 to a six-year low in March, as soaring production from the U.S. and other countries overwhelmed global demand. There are still about 59% fewer rigs working since a peak of 1,609 in October, though the pace of declines has slowed considerably recently. In late May, several U.S. shale-oil companies said they were ready to bring rigs back into service, setting up the first big test of their ability to quickly react to rising crude prices. According to Baker Hughes, gas rigs were down by seven to 209 this week. […]

Posted On : Published By : Tom Whipple
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BHI: Overall US rig count drops slightly, but oil rigs continue rise

A week after jumping by its highest margin since April 2014, the overall US drilling rig count lost 2 units during the week ended July 31 to settle at 874, according to data from Baker Hughes Inc. Rigs targeting oil, however, continued their upward momentum, gaining 5 units. Since the week ended June 26, the oil-directed count has added 36 units. A primary indicator of rig count activity, 950 new well permits were issued last week in the US, representing a noticeable rise from the 806 issued during the previous week. In an energy update released earlier this week, however, Raymond James & Associates Inc. explained that it’s “hard to believe that this will translate into a large increase in activity” given the recent dip in oil prices . “This is more likely reflective of plans for increasing activity predicated on a $60[/bbl] oil price, seen just one month […]

Posted On : Published By : Tom Whipple