OEF REVIEW:Three major U.S. shale oil companies have slashed their 2016 capital spending plans more than expected in a bid to survive $30 a barrel oil prices, with one of them saying prices would need to rise more than 20% just to turn a profit.
OEF REVIEW:Question: BP moved very quickly to say it thought that the oil price would stay low for a long time. What factors fed into that statement? Answer: If you consider the two most recent big drops – 2008/2009 and 1998 – both of those were driven by economic recessions. So, we saw big falls in demand. Those tend to correct themselves relatively quickly. In contrast, the price weakness this time was caused by strong growth in supply, initially as a result of very strong growth in US shale. Normally, world demand for oil grows by about 0.8 million barrels a day per year, but at the end of last year US shale, on its own, grew by 1.6 million barrels a day. Last year, we saw a combination of supply increments from Iraq and Saudi Arabia that added a further 1.5 million barrels a day. What we know from history is that the oil market takes an awful lot longer to adjust to supply shocks than it does to cyclical demand shocks.
OEF REVIEW:With the Shanghai Stock Exchange Composite Index down more than 40% since last June, investors worldwide are watching the decline with growing concern – but not because they are invested in the plummeting market (China’s stocks are overwhelmingly held by Chinese). Rather, the fear is that plunging equity prices mean that China’s economy is going down the tubes. But those seeking compelling clues about China’s economic future should look elsewhere.
OEF REVIEW:Saudi Arabia outlined ambitious plans on Monday to move into industries ranging from information technology to health care and tourism, as it sought to convince international investors it can cope with an era of cheap oil. A meeting and presentation at a luxury Riyadh hotel was held against a backdrop of low oil prices pressuring the kingdom’s currency and saddling it with an annual state budget deficit of almost $100 billion.
OEF REVIEW:A change to the North Sea Brent crude oil futures contract will alter the way prices for Brent futures are compared to futures prices for West Texas Intermediate (WTI) crude oil. Beginning January 29, the Brent contract will expire, or rollover to the next month, approximately two to three weeks before expiration of the WTI contract for delivery in the same month. Prior to the change, the Brent contract rollover was only five to seven days ahead of the WTI rollover.
OEF REVIEW:The Great Green Fleet is a Department of the Navy initiative highlighting how the Navy and Marine Corps are using energy efficiency and alternative energy to increase combat capability and operational flexibility. At the close of the ceremony, the Arleigh Burke-class guided missile destroyer USS Stockdale (DDG 106) left the pier to begin its deployment, becoming the first U.S. Navy ship running on an alternative fuel blend as part of its regular operations.
OEF REVIEW:“There is excess supply out there,” the CEO of BP told reporters on Thursday at the World Economic Forum in the Swiss resort. “These are very sharp shocks for countries and the industry. The first mantra of the oil crisis was “lower for longer.” Then “lower for even longer.” Now in Davos, executives are starting to talk—or rather, whisper—about a new nightmare scenario: “A lot lower for a lot longer.”
OEF REVIEW:The Company’s net production target for 2016 is in the range of 470-485 million barrels of oil equivalent (BOE), of which approximately 66% and 34% are produced in China and overseas respectively. The net production targets set for 2017 and 2018 are around 484 and 502 million BOE respectively. The estimated net production for 2015 was approximately 495 million BOE.
OEF REVIEW:With oil prices touching their lowest level since 2003, Dmitry Zhdannikov writes that OPEC officials and deal brokers are looking back nearly two decades and asking whether a behind-the-scenes deal to curb oil output between OPEC and non-OPEC Russia could be struck. He suggests that a paper by Robert Mabro, founder of the Oxford Institute for Energy Studies who helped to broker the 1998 oil deal, could could throw light on the current problem. Mabro wrote at the time: “Changes in policy are always possible, even likely, when significant revenue losses are at stake”.
OEF REVIEW:With oil prices touching their lowest level since 2003, Dmitry Zhdannikov writes that OPEC officials and deal brokers are looking back nearly two decades and asking whether a behind-the-scenes deal to curb oil output between OPEC and non-OPEC Russia could be struck. He suggests that a paper by Robert Mabro, founder of the Oxford Institute for Energy Studies who helped to broker the 1998 oil deal, could could throw light on the current problem. Mabro wrote at the time: “Changes in policy are always possible, even likely, when significant revenue losses are at stake”.
OEF REVIEW:“Hydraulic fracturing remains a highly contentious public policy issue because of concerns about the environmental and health effects of its use. This Critical Issue Paper is written as a primer for the general public, journalists, and even resource professionals who may have difficulty finding objective, credible information about hydraulic fracturing of shales and other unconventional sources and related environmental concerns.
OEF REVIEW:“Hydraulic fracturing remains a highly contentious public policy issue because of concerns about the environmental and health effects of its use. This Critical Issue Paper is written as a primer for the general public, journalists, and even resource professionals who may have difficulty finding objective, credible information about hydraulic fracturing of shales and other unconventional sources and related environmental concerns.
