Oil prices will struggle to rise above $50 a barrel because of the technological shift in U.S. shale that has unlocked more production in recent years, and because of the growing importance of environmental considerations in investing, Morgan Stanley says.

According to the investment bank’s most recent market insight on crude oil, the market moved from a ‘peak oil supply’ narrative back in 2008 to concerns about peak demand in 2020.

“How we got here is a story of technology and environmental advocacy, and one that has material cross-asset implications,” Andrew Sheets, Chief Cross-Asset Strategist for Morgan Stanley, said.

Technology, especially fracking, allowed U.S. producers to dramatically raise oil production in recent years, while investments in green energy and technology are already becoming a major investment theme, according to M.Stanley.

Expectations that oil demand may be closer than thought before the pandemic and the environmental policies have significant implications on the oil market, the investment bank said.

“Coupled with the near-term challenges our analysts see for the oil market, we think prices will really struggle to move above $50/barrel, as levels above this will encourage producers to hedge much more aggressively at these prices. As such, oil prices should lag other ‘reflationary’ assets in this cycle that we like a lot more,” Morgan Stanley’s Sheets said.

The Wall Street bank is more bullish on natural gas producers than it is on oil producers because of more favorable fundamentals in the gas markets.

Click here to read the full article.

If you have further questions related to this topic, feel free to reach out to us here.

Source: Oil Price

Their budgets just don’t add up anymore. That’s why natural gas offers the lifeline of distressed gulf oil giants.  Oil-rich Arab nations are in the throes of a deep economic crisis and facing gaping holes in their finances. Saudi Arabia needs the price of Brent crude to rise to $76 dollars a barrel while UAE needs it to hit $69, Bahrain $96, and Oman $87 to balance their books. Save for tiny Qatar, no Arab oil producer can balance its books at the current price of $40/barrel. GCC nations are now facing huge fiscal deficits, with Kuwait’s deficit of ~40% of GDP the highest in the world.

To make matters worse, once free-flowing credit lines have started to shut down for some. A good case in point is Oman, which is struggling to borrow after credit-rating agencies listed its debt as junk. Jordan had to plead to receive a $2.5bn aid package from the Gulf, only half of what it got eight years ago. Meanwhile, no one from the Gulf appears willing to bail out cash-strapped Egypt or Lebanon.

In short, the countries are being forced to take pretty drastic steps.

Click here to read the full article.

If you have further questions on what Natural Gas Offers, feel free to reach out to us here. 

Source: Oil Price

Jennifer Starck was all set to head to medical school after finishing her degrees in chemistry and chemical engineering. Then she encountered a BP recruiter at a job fair who is in the Alaska oil and gas industry. Before she knew it, she had a job offer and a choice to make.

“They said ‘Houston or Alaska?’ and I said ‘Alaska,’” Starck recalled. “And they said ‘No, seriously — Houston or Alaska?’”

She insisted, and she never looked back. After 21 years, Alaska — and the petroleum industry — has become her home.

Starck is just one of the many women who help keep Alaska’s oil and gas flowing. And just like Starck, many other women in the petroleum industry made their way there on unexpected paths. Jacki Rose planned to work in mining; she now handles regulatory permitting and compliance for Bluecrest Energy. Laura Green started her career in fire protection systems; she is now the regional safety manager for Hilcorp Alaska.

None of these women imagined they’d end up in the oil and gas industry — or that they’d love it as much as they do.

‘You aspire to be what you see’

Click here to read the full article.

Source: ADN.com

If you have further questions related to Alaska oil and gas industry, feel free to reach out to us here.

Market sentiment has been generally bullish over the last week supported by (i) supply disruption caused by Hurricane Sally in the Gulf of Mexico (ii) a draw in commercial crude oil inventories by 4.4 million barrels w/w and (iii) strong language coming from OPEC+ during the JMMC meeting last Thursday, during which Saudi Arabia pressured members to boost compliance to output cuts.

The supply disruption in the Gulf of Mexico reached around 497 thousand bbl/d. Yet, it is reported that supply will soon return as the hurricane has passed the oil production area while being downgraded from category 2 to a tropical storm. Next to the production outages, fuel demand in the affected areas is likely to have been disrupted, at least for a couple of days. Gulf of Mexico drillers, however, are already preparing for a new storm as Beta is approaching fast, potentially leading to another supply outage in the Gulf.

Click here to read the full article.

Source: Oil Price

Colombia’s state-held oil firm Ecopetrol has a strategic alliance with Occidental Petroleum. It is to develop acreage in the Permian. There are plans to have drilled as many as 100 wells in the most prolific U.S. shale basin. It is by the end of 2021. Ecopetrol’s CEO Felipe Bayon told a conference on Monday. Continue reading about Colombia oil production below.

“By the end of next year, we should have over a hundred wells,” Bayon said at a virtual conference, as carried by Reuters.

Last year, Ecopetrol and Occidental Petroleum Corp agreed to set up a strategic joint venture to develop unconventional reservoirs in approximately 97,000 acres of the Permian Basin in West Texas.

This deal was part of Ecopetrol’s strategic priorities to develop more unconventional resources and have more operations outside Colombia, the company said in November 2019.

Between November last year and June this year, Ecopetrol drilled 22 wells. However, oil production has slowed because of the oil demand and price crash in the pandemic, according to Bayon.

Despite the current low oil prices, Ecopetrol expects to have 100 wells drilled in the Permian by the end of next year, said the company’s executive.

Click here to read the full article.

Source: Oil Price

If you have further questions about Colombia oil, feel free to reach out to us here.