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Texas Oil Production On Track To Break Record

Economist Karr Ingham projects crude oil production in Texas will reach an all-time high in 2015. This opinion piece presents the opinions of the author. It does not necessarily reflect the views of Rigzone. Just about everyone knows that crude oil and natural gas production in Texas has been on the increase for several years. But the size of the increase – especially in crude oil production – has been lost until just a few days ago when economist Karr Ingham told a gathering of reporters in Houston that he projects crude oil production will reach an all-time high in 2015, breaking the old record set in 1972. Ingham, speaking to roughly a dozen reporters in Houston on July 27, pointed out that the decline in oil price, drilling rig count, drilling permits, and well completions would strongly indicate that oil production would decline, also. That has not been […]

Posted On : Published By : Tom Whipple
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Hess sees higher 2015 Bakken oil production on fewer rigs

Hess raised its 2015 production forecast for prolific Bakken shale oil formation in North Dakota to 105,000-110,000 boe/d as more efficient well completions counter a lower rig count, CEO John Hess said Wednesday. Earlier this year, Hess had estimated 2015 Bakken production would range at 95,000 boe/d-110,000 boe/d. The company had cut its rig count from the 12 operating in Q1 to the eight currently operating in response to sharply lower crude costs. The price of Bakken from the Clearbrook, Minnesota, oil hub averaged $56.98/b in the second quarter, Platts assessment data showed. So far in the Q3, it has averaged $48.40/b, touching $44.31/b on Tuesday. Crude movements by rail between the Midwest and the East Coast refineries, one of the largest users of Bakken crude, has been falling. It was 12.41 million barrels in April, down from 12.86 million barrels in March, US Energy Information Administration data shows. […]

Posted On : Published By : Tom Whipple
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Exxon, Chevron Brace for Darker Times as Earnings Slump

Exxon Mobil Corp. and Chevron Corp., the biggest U.S. energy producers, hunkered down for a prolonged stretch of weak prices after posting their worst quarterly performances in several years. Exxon reported its lowest profit since 2009 as crude prices fell twice as fast as the world’s largest crude producer by market value could slash expenses. Chevron recorded its lowest profit in more than 12 years after the market rout forced $2.6 billion in asset writedowns and related charges. The companies’ shares fell to multi-year lows. Stung by the worst market collapse since the financial crisis of 2008, oil explorers from The Hague to Calgary to Houston are firing staff, scaling back drilling, canceling rig contracts and reducing share buybacks to conserve cash. Chevron said the slump convinced it to lower its long-term outlook for crude prices. “This is the beginning, not the end, of the writedown process,” Paul Sankey, […]

Posted On : Published By : Tom Whipple
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Tumbling oil prices slam profit at Exxon Mobil, Chevron

The Belgian headquarters of oil giant ExxonMobil, where Britain’s Nicholas Mockford worked, is pictured in Machelen, northern Brussels, October 27, 2012. Weak oil prices CLc1 shriveled quarterly profit at Exxon Mobil Corp ( XOM.N ) and Chevron Corp ( CVX.N ), compelling both companies to rethink operations and plan for what many expect to be a sustained period of cheap crude. Earnings at Exxon and Chevron, two of the world’s largest oil producers, also missed analysts’ expectations, adding to concerns that perhaps executives had not acted quickly enough to mitigate the impact of an over-50-percent drop in oil prices since last summer. The results also highlighted how smaller and more nimble U.S. shale oil companies had slashed costs faster and more aggressively than global majors. Some shale producers have cut back drilling by 60 percent or more. Exxon’s profit fell by more than half, with the biggest drop in […]

Posted On : Published By : Tom Whipple
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OPEC says oil should not fall further, sees stability in 2016

The OPEC logo is seen at OPEC’s headquarters during a meeting of OPEC oil ministers in Vienna, Austria, June 5, 2015. OPEC expects increasing oil demand to prevent a further fall in prices and sees a more balanced market in 2016, its secretary-general said on Thursday, the latest sign the group is sticking to its policy of defending market share. Oil LCOc1 has dropped about 15 percent this month and halved in value in the past year but neither OPEC nor Russia, the world’s top producer, have cut output to support prices, hoping cheaper oil will hit U.S. shale and other rival sources. "I would not expect they (prices) are going to fall because demand is growing," OPEC Secretary-General Abdullah al-Badri told reporters in Moscow. OPEC pumps around 40 percent of global oil production. "The current situation is a test for all producers and investors. While the prices … […]

Posted On : Published By : Tom Whipple
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5 Things To Watch In Friday’s Oil-Supply Report

More than a year after the oil-price slump began, traders are desperate to determine whether U.S. crude-oil production has started to decline in response to low prices. Mixed and delayed data from the federal government have added to the uncertainty. Market watchers are hoping the next monthly government report, which will offer the first data for May, will help clear up some of the confusion. Here are five things to watch when the U.S. Energy Information Administration, the data-gathering arm of the Energy Department, releases its Petroleum Supply Monthly, expected at 2 p.m. EDT on Friday.

Posted On : Published By : Tom Whipple
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Bakken Driller’s Reset Points to More Pressure on Oil

The Bakken-shale-focused oil-and-gas producer uttered the “F” word in its 2016 outlook: Fifty. That is the oil price underpinning its cash-flow and production targets for next year. It is slightly above where the price is now but fully one-fifth below the consensus forecast. Whiting’s shares plunged 6% on Thursday. The bigger story from Whiting’s uncharacteristic display of hunkering down is its bearish implication for oil prices. First, consider that based on $50 oil, Whiting plans to lay out $1 billion on capital expenditure in 2016, equal to projected cash flow. That would be a 53% cut in investment versus guidance for this year, leading to just an expected 10% drop in output. That reflects productivity gains with Whiting reporting output gains of 40% to 50% in some recently completed wells. Second, Whiting also said Thursday that its budget is “flexible.” There is a certain irony in this: The company […]

Posted On : Published By : Tom Whipple
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Canadian Oil Sands Posts Loss on Lower Crude Prices

CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 0.90 % on Thursday reported a net loss in the second quarter, citing lower prices for its crude and the effect of a two percentage point corporate tax hike in the Western Canadian province where it operates. The largest owner of the Syncrude oil sands project in northern Alberta lost 128 million Canadian dollars ($98.4 million), or 26 Canadian cents a share, in the three months to June 30, compared with a net profit of C$176 million, or 36 Canadian cents a share, in the year-earlier period. It said the loss mainly came from a C$120 million deferred tax expense reflecting an increase in Alberta’s corporate tax rate to 12% from 10% previously. The company also suffered from a global crude oil price drop, which has affected many so-called unconventional producers of oil-sands crude and shale oil. Citing expenses in excess of […]

Posted On : Published By : Tom Whipple
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EIA reports show different aspects of U.S. oil production statistics and trends

graph of U.S. crude oil production, as explained in the article text Source: U.S. Energy Information Administration, Petroleum Supply Monthly , Weekly Petroleum Status Report , Drilling Productivity Report , Short-Term Energy Outlook EIA publishes several reports covering current crude oil and natural gas production conditions and how recent trends may affect the near-term outlook for the oil and gas industry. Each EIA product is distinct in its purpose, methodology, timeframe, and regional coverage. Some reports are considered estimates of actual production volumes, while others focus on future production. The Petroleum Supply Monthly (PSM) reports estimates of crude oil and petroleum products production, imports and exports, movements, and inventories on a national and regional level, lagged by two months. PSM estimates of crude oil production rely on several sources, including administrative data from state and federal agencies, the EIA-182 survey of crude oil purchase volumes, and administrative data from […]

Posted On : Published By : Tom Whipple