U.S. Oil Production Is On The Rise Again

Crude oil production, including lease condensate, in the United States rose in September to 10.860 million barrels per day on average, according to the Energy Information Administration’s monthly report released on Monday. September’s oil production was up 286,000 barrels per day on average compared to the month prior, but still down significantly—1.635 million bpd—from September 2019.

The increase in September over August was mostly due to offshore oil production off the Gulf of Mexico, which saw a 315,000 bpd increase to 1.510 million bpd. This compares to 1.917 million bpd in September 2019.

North Dakota’s oil production also increased in September to 1.215 million bpd, for an increase of 61,000 bpd.

Meanwhile, Texas—which accounts for the largest portion of oil production by far – saw declines in its September crude oil production, to 4.628 million bpd from 4.688 million bpd. Texas’ oil production is 563,000 bpd lower than the same month last year.

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Source: Oil Price

Total And Exxon Renegotiate A Major Gas Sharing Deal

Supermajors ExxonMobil and Total are renegotiating a natural gas resource sharing deal for their respective liquefied natural gas (LNG) projects offshore Mozambique, Reuters reports, citing sources with knowledge of the talks.

Exxon and Total are leading the Rovuma LNG and the Mozambique LNG projects, respectively, and are looking to renegotiate a 2015 deal on using resources from the basins that would supply gas to their respective projects. Both oil majors, who are looking to cut project costs, want to use the resources from a shared field first because they are cheaper to extract.

The 2015 deal stipulates that Exxon and Total extract a total of 24 trillion cubic feet of natural gas from the “straddling” reserves in a 50/50 share in the first phases of their projects.

“They want to use the cheapest gas first – which is the straddling resources,” one of Reuters’ sources said.

The renegotiation of the gas extraction deal also involves the government of Mozambique, which has to sign off on any new resource-sharing deal, the sources told Reuters.

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Source: Oil Price

Oil Stocks Are Finally Bouncing Back

This year has been a true rollercoaster ride for the U.S. oil and gas market, but it is increasingly looking to end on a high note.

The sector is up nearly 16% over the past 10 days alone as the world moves closer to vanquishing one of mankind’s biggest threats in modern history.

The outlook keeps getting better for the oil and gas bulls.

Here are three key reasons why the bulls are likely to have the upper hand going forward.

#1. Covid-19 vaccines The oil and gas industry has been deeply out of favor over the past few years, thanks to huge supply/demand imbalances that only got much worse after Covid-19 struck. Indeed, trying to call a bottom on the bear market has largely been a fool’s errand as one step forward (OPEC production cuts) was immediately met by several steps backward (massive demand destruction due to global lockdowns).

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Source: Oil Price

venezuela

Why Biden’s Approach To Venezuela Is So Important For Oil Markets

In a hard-fought campaign Democrat Joe Biden won the November 2020 U.S. presidential race beating incumbent Donald Trump. There were considerable fears in the run-up to the election that a Biden victory would put a damper on oil prices but, along with the boost given by news of a COVID-19 vaccine, the opposite has occurred. This has been a boon for many South American countries where petroleum production is an important economic driver. Biden’s ascension to the top job marks an end to the hardline policy taken by the Trump White House toward Venezuela and its attempts to oust autocratic socialist leader Nicolás Maduro.

Trump’s aggressive sanctions, which cut Venezuela off from global energy and capital markets as well as the veiled threat of military intervention appear to have failed. Essentially, that policy forced Maduro to turn initially to China, then Russia and finally Iran for assistance to prop-up his position and receive strategic financial, economic, political and military lifelines. It permitted Moscow to bolster its influence in Latin America and gain control over Venezuela’s vast oil reserves, which at 300 billion barrels are the world’s largest. In exchange for debt relief, loans and military advisers Moscow gained access to Venezuela’s all-important economic engine and some of the country’s most valuable oil assets. These include ownership of interests in some of Venezuela’s most productive oil projects and a 49.9% lien, from an oil backed loan, over PDVSA’s Citgo refining business, which many analysts regard to be the crown jewel of the state-owned oil company’s assets. To mitigate the impact of U.S. sanctions on Russian government controlled but publicly listed energy company Rosneft, which initially was responsible for the oil backed loans to Caracas, a Kremlin owned company purchased all Venezuelan assets earlier this year.

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Source: Oil Price

Oil & Gas Discoveries Resilient In 2020 Despite Pandemic

Despite delays in drilling campaigns and reduced exploration budgets due to COVID-19, the volume of oil and gas discoveries globally is set to reach 10 billion barrels of oil equivalent (boe) this year, avoiding a repeat of the multi-decade low during the previous crisis in 2016, Rystad Energy said in a new analysis on Monday.

In 2016, just 7.7 billion boe were discovered globally.

Between January and October this year, a total of 73 discoveries of oil and gas resources were announced, with the combined resources already exceeding 8 billion boe, the energy research company said.

Wildcats planned for the final two months of 2020 could yield more resources and raise this year’s total discovered volumes to around 10 billion boe, Palzor Shenga, senior upstream analyst at Rystad Energy, said.

Of the discoveries announced through October, 36 were onshore and 37 were offshore, with gas accounting for 46 percent of the total discovered resources.

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Source: Oil Price

The 6 Hottest Energy Tech Stocks For 2021

Two of the hottest sectors in the ESG revolution right now are hydrogen and absolutely anything that ties into the $5 trillion global transportation industry.

Investors are piling into hydrogen – a potential solution for a clean energy future – and it’s now predicted to become an $11-trillion marketplace by 2050.

It simultaneously compliments and competes with the explosively growing EV sector, where Tesla (NASDAQ:TSLA) is predicted to be on track to become a $1-trillion company, or even $2 trillion, by some estimations, up from its current $400 billion.

The profound transportation revolution that’s unfolding at the moment has so many verticals, it’s dizzying.

From a mad scramble to get out more vehicles and steal market share, to battery battles, the race for the best charging solution, carbon-offset ride-sharing and landmark EV car subscription services…. a lot is at stake floating around this huge space.

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Source: Oil Price

Oil Prices Rise On Election Day

Oil prices jumped early on Tuesday, with Brent back above the $40 a barrel mark, supported by a rally in financial markets and a weaker U.S. dollar on Election Day.

As of 9:45 a.m. EST on Tuesday, WTI Crude was up 3.53 percent at $38.13 and Brent Crude was rallying 3.08 percent to $40.17, returning to above $40 for the first time in a week.

On Monday, oil prices dropped in early trading as more European countries announced lockdowns, but oil closed higher after the U.S. financial markets rebounded later on Monday.

On Tuesday, oil prices rallied early on U.S. Election Day as equity markets around the world and in the U.S. also rose, with traders bracing for the outcome of the election.

Commenting on the move in oil prices early on Tuesday, Tamas Varga with oil brokerage PVM told Reuters:

“The jump has borne all the hallmarks of a massive, logical and even inevitable short-covering prior to the U.S. presidential elections.”

According to the analyst, Tuesday’s oil rally is exclusively due to the U.S. election, not a recovery from the slump in oil prices last week.

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Source: Oil Price

The Next Oil & Gas Battleground For Supermajors

Chevron’s acquisition of Noble Energy launched an ongoing M&A frenzy in the U.S. shale patch as companies look to consolidate to cut costs while adding immediately cash-flow-positive resources to their portfolios. For Chevron, the US$5-billion all-stock deal to take over Noble Energy was not only about adding acreage in the DJ and Permian basins.

Through the transaction, the U.S. supermajor is gaining more exposure to natural gas assets in the Eastern Mediterranean, including a large stake in Israel’s biggest gas field, which started production in December 2019.

The already producing Leviathan gas field, the biggest energy project in Israel ever, is diversifying Chevron’s portfolio with more natural gas resources and a position in the eastern Mediterranean very close to the Middle East and European gas markets.

The timing of the U.S. supermajor’s bet on natural gas in the Eastern Mediterranean coincides with expectations that gas will play a major role in supporting the growing share of renewables in Europe amid the European Union’s (EU) push to bet heavily on renewable energy sources to reach carbon neutrality by 2050 under the European Green Deal.

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Source: Oil Price

Saudi Energy Minister: The Worst Is Over For Oil Markets

The worst of the oil market is behind us, Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said on Monday at CERAWeek’s India Energy Forum.

“We are still vigilant. I think there is a big shift all together in terms of where we are today and where we were in April and May,” bin Salman added.

But it is unclear what part of the worst is in the rearview.

If the Energy Minister is referring to oil demand, the largest importer of crude oil—China—is expected to slow its imports after the oil-thirsty nation bought extra crude over the last few months to take advantage of the ultra-low prices in the market. So much so had China taken extra crude, it created a backlog in customs, which is now clearing up—a sign that it is slowing.

This is to be expected now that oil prices have rebounded to nearly double what they were in April.

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Source: Oil Price

A Biden Presidency Could End The U.S. Oil Boom

To talk about a Biden-Harris administration let’s first talk about the Obama-Eric Holder/Loretta Lynch administration. Back in 2015 and 2016, when Holder and Lynch were President Obama’s Attorney Generals, my frack company was beset with an IRS audit, an International Fuel Tax (“IFTA”) audit and a Department of Labor investigation. Not to be excluded, I was also personally audited by the IRS. Fortunately, me and my company cleared the IRS audits without penalty (other than paying our accountant). The Department of Labor audit got us for something less than $250, based on some arcane back of the book calculation on arbitrarily given bonuses. But the IFTA audit did some damage with a $40,000 paperwork related fine even though all our taxes were paid at the pump. All three agencies and all four audits were federal, and all came at roughly the same time. When I asked the Department of Labor attorney how she even found our little basement office, she kept mum. There was no point in her answering—we both knew why she was there. Her 18,000-employee strong department, like the IRS and IFTA, had been weaponized to undermine the oil and gas industry. AGs Holder and Lynch, likely with President Obama’s blessing, were picking and choosing and me and my industry got picked.

On March 1st, in 2016, I came home from work and told my wife I was worried about Aubrey McClendon, the founder of Chesapeake Energy and American Energy Partners. The following morning, he was to be arraigned in Oklahoma for violations of the Sherman Anti-Trust Act.

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Source: Oil Price / Photo: Wikipedia Creative Commons