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Top 5 Oil Producing Countries Could See Production Peak This Year

The EIA’s Short-Term Energy Outlook came out a few days ago. That is where they try to guess the future production and price for oil, for the USA as well as the world. As of late they seem to be getting a little timid with their predictions. They are saying not much growth is happening until the fourth quarter of 2016, and only a slight bump then. (Click to enlarge) This chart is Non-OPEC Total Liquids in million barrels per day. Production of N.O Liquids surged upwards from September of 2012 until December 2014, gaining 6.38 million barrels per day in those 27 months. That’s an average increase of 236,000 barrels per day per month. But then in January 2015 there was a drop of 800,000 bpd. Non-OPEC total liquids still have not reached that December high again but the EIA thinks they will by August. I have my […]

Posted On : Published By : Tom Whipple
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Oil Production Shows Signs of Flagging

The U.S. and the Organization of the Petroleum Exporting Countries have flooded the world with crude oil, sending prices tumbling. But the abundance has overshadowed declining production in areas—from Colombia to Norway to northern China—that experts consider vital to long-term supply growth. Confronted with the plunge in prices, companies in these regions are delaying and canceling projects. Across the world, just six major oil projects received the green light in 2014, compared with an average of more than 20 a year from 2002 to 2013, according to Deutsche Bank AG. The International Energy Agency said Friday that growth in supplies from outside OPEC would “grind to a halt” in 2016, with output due to fall in Russia, Mexico, Europe and elsewhere. Oil companies need to replace between 5% and 8% of crude output each year just to offset shrinking production from old wells, analysts estimate. Currently, that amounts to […]

Posted On : Published By : Tom Whipple
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EIA report forecasts further US shale oil output drops in August

US crude oil production from shales is projected to fall for the fourth month in a row in August to 5.357 million b/d, a drop of 91,000 b/d from July estimates, the US Energy Information Administration said Monday in its latest Drilling Productivity Report. It is the second consecutive month the agency has predicted a month-on-month decline of 91,000 b/d. The data, which EIA began publishing in October 2013, showed estimated oil production in the Bakken, Eagle Ford and Niobrara shale plays dropping in August, although Permian Basin production will continue to rise. EIA data predicted oil output in the Permian, located in West Texas and New Mexico and widely considered the US’ hottest unconventional play, to increase 5,000 b/d in August to 2.046 million b/d. That is up from the 3,000 b/d increase that the agency estimated for July. Article continues below… Crude Oil Marketwire delivers vital intelligence […]

Posted On : Published By : Tom Whipple
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Oil output from U.S. shale plays seen down for fourth month -EIA

Oil production from U.S. shale in August is expected to fall by the most since at least 2007, according to the U.S. agency tasked with tracking oil output, the latest sign a price rout will shrink the nation’s crude output. Oil production from the largest U.S. shale plays will plunge in August for a fourth consecutive month, forecasts from the U.S. Energy Information Administration showed on Monday. Output was expected to decline by 91,000 barrels per day, 12 percent over July’s forecast production decline, to 5.4 million bpd, the lowest level since November for the seven shale plays tracked in EIA’s productivity report. Energy firms fired thousands of workers and cut back on new drilling after U.S. crude futures collapsed 60 percent from over $107 a barrel in June 2014 to near $42 in March on oversupply concerns and lackluster world demand. Despite the cuts, however, overall U.S. production […]

Posted On : Published By : Tom Whipple
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Shale Oil Output Heads for Record Drop After Drilling Swoon

U.S. Oil Boom Stymied Shale fields that powered the U.S. energy renaissance will suffer the biggest drop in output since the boom began after companies idled more than half their drilling rigs. Production from the prolific tight-rock formations such as the Eagle Ford in southern Texas will decline 91,000 barrels a day in August to 5.36 million, the Energy Information Administration said Monday. It’s the fourth month in a row production is expected to slide, after more than tripling from 2007. Output is slipping after producers from ConocoPhillips to EOG Resources Inc. reduced the number of drilling rigs in order to cut costs following a 50 percent drop in the price of oil. About 645 rigs were drilling for oil last week, down from 1,609 in October, according to oil-field service company Baker Hughes Inc. “The market is largely anticipating oil production to keep declining this year and snap […]

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North Dakota oil production up despite fewer rigs

North Dakota rig numbers decline, though state data show operators on shale basins are doing more with less. UPI/Gary C. Caskey BISMARCK, N.D., July 13 (UPI) — The number of rigs actively exploring for or producing oil and gas in North Dakota declined nearly 4 percent from last week, state data show. North Dakota reported 73 rigs in active service as of Monday, down from the 76 reported one week ago. The exploration and production side of the North Dakota, measured by rig counts, is slower by more than half from this date in 2014, when 190 rigs were deployed across the state. Rig deployments were near historic highs in 2012, with 215 reported. 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 . State government data […]

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North Dakota’s oil output stabilizes but does not fall: Kemp

Pumpjacks taken out of production temporarily stand idle at a Hess site while new wells are fracked near Williston, North Dakota November 12, 2014. Crude oil production data published by the state of North Dakota on Friday contained something for both bulls and bears. Bears can point to the unexpected resilience of shale production in the face of lower oil prices while bulls can point to the fact that production is no longer growing after five years of tremendous gains. The state pumped an average of 1.2 million barrels per day (bpd) in May, an increase of 32,000 bpd compared with April, according to the Department of Mineral Resources ( link.reuters.com/kan25w ). Production remained steady with an average of just 80-90 rigs drilling in May, far fewer than the 120-130 rigs the department forecast at the start of the year would be necessary to maintain 1.2 million bpd. By […]

Posted On : Published By : Tom Whipple
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Energy Companies to Merge in $15.8 Billion Deal

A Marathon Petroleum refinery in Texas City, Texas. A partnership controlled by Marathon Petroleum Corp. MPC 7.87 % , a refinery and pipeline company, will buy MarkWest Energy Partners LP for $15.8 billion in one of the biggest oil-patch deals since crude prices began to slump last summer. The deal will marry Marathon’s oil pipeline network with MarkWest’s business separating natural gas into fuels such as propane and ethane. The combined company would have a market capitalization of $21 billion, making it the fourth-largest master limited partnership. These partnerships, which typically own infrastructure like pipelines that earn steady revenue from long-term contracts, have fared better than traditional drilling companies during the energy downturn but still have faced headwinds. Shares of MPLX closed 15% lower to $59, while shares of MarkWest rose nearly 14% to $68. Shares of Marathon Petroleum Corp. rose 7.9%. The deal is the latest consolidation between […]

Posted On : Published By : Tom Whipple
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EIA Confirms: U.S. Oil Production Peaked

U.S. oil production has peaked…at least for now. That is the conclusion from a new government report that concludes that U.S. oil production is on the decline. After questions surrounding the resilience of U.S. shale and when low oil prices would finally cut into production, the EIA says the month of April was the turning point. In its Short-Term Energy Outlook released on July 7, the EIA acknowledged that U.S. oil production peaked in April, hitting 9.7 million barrels per day (mb/d), the highest level since 1971. In May, production fell by 50,000 barrels per day, and EIA says that it will continue to decline through the early part of next year. Still, the declines won’t be huge, according to the agency’s forecast – production will average 9.5 mb/d in 2015 and 9.3 mb/d in 2016. The EIA figures move a little closer to what some critics have been […]

Posted On : Published By : Tom Whipple