Why Friday’s OPEC Meeting Will Be Insignificant, Like OPEC Itself

Here is the proposed agenda for Friday’s OPEC meeting in Vienna:
10:00 – Convene
Noon – Adjourn
16:00 – Hold a press conference
That’s it. Oh, and probably plenty of forged smiles and photo ops before, during and after. However, if we could somehow peel the curtain back and see the real picture, things are not at all as rosy as it may seem.
[Read more…]

2015 Oil Market Rebalancing

Sweet crude has never tasted so sour. With global layoffs exceeding 100,000 jobs and rising, and oil trading at $50/bbl, many people in the oil industry are wondering, when will we see an end to another oil depression?
It all started in 2008, with the development of advanced techniques of hydraulic fracturing and the perfection of horizontal drilling. This allowed the United States, the world’s biggest importer of oil at the time, to tap into plays that were previously uneconomical, mainly shales. This forward step increased U.S. oil production by over 70% and has reduced oil import from OPEC (Organization of the Petroleum Exporting Countries) by 50%.
[Read more…]

Oil pricing: Is this a ‘new normal’?

After three years of US$100-plus crude prices, some in the energy industry were caught off-guard when prices declined by 40 percent in the fourth quarter of 2014.
A glut of supply – including record production from unconventional development in the US – and slow-growing demand put a quick downward pressure on prices.
[Read more…]

Russia, Iraq Remind Us: New Ruling Comes None Too Soon

We may finally be seeing the beginning of the end of an era, and none too soon.

In late June, the U.S. Department of Commerce cracked open the door, ever so slightly, for U.S. exports of condensate. The ruling applies, for now, to only two companies: Pioneer Natural Resources Co. and Enterprise Products Partners LP. While the ruling does not lift the ban on crude oil exports, it does provide a legal work-around that could have the net effect of flinging open the door that has been closed since the 1970s.
[Read more…]