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prokaryotes

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Re: Oil and Gas Issues
« Reply #3900 on: August 05, 2020, 07:13:22 PM »
Quote
At abandoned oil and gas wells in the North Sea, considerable quantities of the potent greenhouse gas methane escape uncontrolled into the water.
https://www.sciencedaily.com/releases/2020/07/200730113055.htm
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #3901 on: August 08, 2020, 09:13:48 PM »
Quote
Eric Holthaus (@EricHolthaus) 8/7/20, 11:24 PM
Mauritius has declared a state of environmental emergency as oil from a sinking ship has begun to spread.
https://twitter.com/ericholthaus/status/1291938347598974982
Quote
Priya Hein (@PriyaHein) 8/7/20, 4:51 AM
Absolutely shattered by the ecological crisis faced by Mauritius. These pictures of the oil spill, wrecking our most beautiful lagoons, were taken by my friend Eric Villars on his flight to Rodrigues this morning. #mauritius #oilspill #wakashio #bluebay #coralreefs #marinepark 
https://twitter.com/priyahein/status/1291658086617407489
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vox_mundi

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Re: Oil and Gas Issues
« Reply #3902 on: August 09, 2020, 03:07:58 PM »
Saudi Aramco Profit Drops 50% for First Half of the Year as Pandemic Batters Oil Price
https://www.cnbc.com/amp/2020/08/09/saudi-aramco-profit-drops-50percent-for-first-half-of-the-year-as-pandemic-batters-oil-price.html

Saudi Aramco's net income plunged to $23.2 billion in the first six months of the year, down by half from $46.9 billion over the same period in 2019.

Saudi Arabia's majority state-owned oil company and the world's largest crude producer also maintained its second-quarter dividend of $18.75 billion, saying it will be paid in the third quarter.

The financial results for the second quarter reflect the biggest shock to global energy markets in decades.

... "The worst is likely behind us," Nasser told the earnings call. "We remain fairly positive about the long term demand for oil."

https://www.aljazeera.com/amp/ajimpact/aramco-profit-crashes-73-sees-signs-oil-market-recovery-200809134222819.html

-----------------------------------

... It's like déjà vu all over again. ...

May 1, 1930

"While the crash only took place six months ago, I am convinced we have now passed the worst and with continued unity of effort we shall rapidly recover.

- President Hoover

https://www.reliefmine.com/articles/economy/183-quotes-following-the-1929-stock-market-crash
« Last Edit: August 09, 2020, 10:39:38 PM by vox_mundi »
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #3903 on: August 10, 2020, 05:09:45 PM »
Quote
Saudi Aramco Profit Drops 50% for First Half of the Year as Pandemic Batters Oil Price

And here’s what they plan to do about it:

Saudi Aramco to press ahead with plan to boost output capacity, CEO says
Quote
DUBAI/RIYADH (Reuters) - Saudi Aramco (2222.SE) is moving ahead with plans to boost crude output capacity by 1 million barrels per day (bpd) to 13 million bpd despite cuts in capital expenditure this year and next year, the state oil group’s CEO said on Monday.
...
Aramco reported a 73% fall in its second quarter profit, as lockdowns to contain the coronavirus reduced oil consumption and sent prices tumbling to levels not seen in nearly two decades. ...
https://www.reuters.com/article/us-saudi-aramco-results-capacity/saudi-aramco-to-press-ahead-with-plan-to-boost-output-capacity-ceo-says-idUSKCN2561U9
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Ken Feldman

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Re: Oil and Gas Issues
« Reply #3904 on: August 10, 2020, 08:03:40 PM »
Saudi Aramco is spinning every bit of positive news they can to try to prop up oil prices.  Read beyond the headlines.

https://oilprice.com/Energy/Crude-Oil/Saudi-Aramco-Asian-Oil-Demand-Recovery-Almost-At-Pre-Crisis-Levels.html

Quote
Saudi Aramco: Asian Oil Demand Recovery Almost At Pre-Crisis Levels
By Tsvetana Paraskova - Aug 10, 2020

The world’s biggest oil-producing and oil-exporting company, state oil giant Saudi Aramco, is optimistic about the pace of oil demand recovery in Asia, chief executive Amin Nasser said on Sunday, helping oil prices rise on Monday.

Saudi Aramco says,
Quote
Demand for crude oil in Asia has almost returned to the levels from before the pandemic, Bloomberg quoted Nasser as saying.

Reality says,
Quote
In June, global oil demand is somewhere around 90 million barrels per day (bpd), up from 75-80 million bpd in April

Note that global oil demand was 100 million barrels per day before the Covid recession.

The article also has this interesting info about aviation levels:

Quote
n another sign of optimism about demand, data from global flight tracking service Flightradar24 showed on Saturday that on Friday, August 7, there were more than 70,000 commercial flights globally for the first time since March 20. Yet, the number of commercial flights was still down 43.6 percent compared to the same Friday in August 2019.

And many Asian countries are now struggling to contain a second wave of Covid-19 outbreaks.

https://www.cnn.com/2020/07/28/asia/coronavirus-hong-kong-vietnam-china-intl-hnk/index.html

Quote
Even countries that got coronavirus under control are now struggling. That's deeply concerning for the rest of the world
July 28, 2020
James Griffiths, CNN

Quote
Across the Asia-Pacific region, where countries were among the first hit by the virus and the first to contain it, there have been new and in some cases seemingly unexplained increases in the number of infections. Governments that had previously been lauded for their response to the pandemic now seem to be struggling.

Quote
On Tuesday, China reported the highest number of locally transmitted coronavirus cases since early March for the second consecutive day, with the majority of the 64 new domestic cases in Xinjiang. The far western region has seen a fresh outbreak in its capital Urumqi since July 15, after nearly five months of no new cases.

Down south in Hong Kong, the semi-autonomous Chinese city is also experiencing a major new outbreak, with more than a thousand new cases in the past two weeks, and six days straight of over 100 cases. The new surge came after the city appeared to be almost cornonavirus free, relaxing restrictions and beginning discussion of potential "travel bubbles" with other post-pandemic parts of the world.

While there was a slight dip in the number of cases recorded on Monday, Japan has been seeing some of its worst numbers since the early phases of the pandemic, with some 5,000 new cases in the past week, according to Johns Hopkins University (JHU) data. The worst of the new outbreak has been focused on the capital Tokyo, which recorded six straight days of over 200 new cases until Monday, when there were 131 cases. However, that dip may be because there were far fewer tests performed over a four-day holiday weekend designed to promote domestic tourism.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3905 on: August 18, 2020, 08:03:38 PM »
Many oil refineries are idling or closing permanently due to the demand destruction caused by the Covid pandemic.

https://oilprice.com/Energy/Energy-General/Refinery-Closures-Continue-Amid-Oil-Demand-Slump.html

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Refinery Closures Continue Amid Oil Demand Slump
By Tsvetana Paraskova - Aug 17, 2020

Refiners are shutting down permanently or converging oil refineries as the demand crash from the pandemic continues to crush refining margins.

Several refiners and oil majors have recently announced permanent closures in the United States and Asia, while analysts believe that some high-cost refineries in Europe could also be shut down over the next few years as margins for processing crude into fuels are expected to remain depressed.

Quote
Some refiners have already announced closures. Last week, Phillips 66 said it plans to shut down the Rodeo Carbon Plant and Santa Maria refining facility in Arroyo Grande, California, in 2023. Phillips 66 plans to reconfigure its San Francisco Refinery in Rodeo, California, to produce renewable fuels.

Marathon Petroleum is idling the Gallup and Martinez refineries indefinitely and is evaluating the strategic repositioning of Martinez to a renewable diesel facility.

In Asia, Shell plans to transform its Tabangao oil refinery in the Philippines into a full import terminal to optimize its asset portfolio.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3906 on: August 18, 2020, 08:06:39 PM »
LNG demand remains low.

https://dailyenergyinsider.com/news/26698-covid-19-mitigation-efforts-keep-liquefied-natural-gas-demand-low/

Quote
COVID-19 mitigation efforts keep liquefied natural gas demand low

Published on August 13, 2020 by Chris Galford

A new report from the United States Energy Information Administration (EIA) brought mixed news for the natural gas sector, noting that liquefied natural gas exports for the United States remain low due to the COVID-19 pandemic, but with the hope that normality should return in November.

In January 2020, before COVID-19 went into full swing across the world, U.S. exports of LNG hit a record high of 8 billion cubic feet per day (bcf/d). By July, they were down to 3.1 billion bcf/d, and at one point — the week of July 12-18 — only 2 bcf/d were loaded. About 50 cargoes were canceled in July, exceeding the reported number of expected cancelations, according to the EIA.

Quote
Worldwide demand has also tanked in response to COVID-19 mitigation efforts.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #3907 on: August 24, 2020, 12:53:47 AM »
Valaris, world’s largest offshore rig owner, declares bankruptcy
8/19/2020
Quote
NEW YORK (Bloomberg) --Valaris Plc became the latest casualty of the global slump in oil prices, filing for bankruptcy Wednesday as the world’s largest offshore rig owner by fleet size seeks to restructure a roughly $7 billion debt load.

The Chapter 11 filing in the U.S. Bankruptcy Court for the Southern District of Texas comes after the company said it could be forced to seek creditor protection after skipping bond payments.
...

London-based Valaris, which was created in 2019 out of the combination of Ensco Plc and Rowan Companies Plc., joins rivals Noble Corp. and Diamond Offshore Drilling Inc. in bankruptcy. Pacific Drilling SA earlier this month said it may return to bankruptcy court for the second time in less than three years, and Transocean Ltd., the world’s biggest owner of deep-water oil rigs, has said it’s exploring strategic alternatives.

The offshore industry has struggled since oil prices plunged to less than $30 a barrel in 2016 after reaching more than $100 in mid-2014. While newer deep-water projects are less expensive, they still take longer to develop than land-based shale wells and typically are more costly, leaving them at a disadvantage as crude plummeted further earlier this year amid the Covid-19 pandemic.
https://www.worldoil.com/news/2020/8/19/valaris-world-s-largest-offshore-rig-owner-declares-bankruptcy
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Sigmetnow

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Re: Oil and Gas Issues
« Reply #3908 on: August 25, 2020, 02:48:05 PM »
BURN!

Exxon Booted from Dow Industrials [stock index] in Major Embrace of Tech
Quote
While any change to the Dow is notable, the ejection of Exxon Mobil, the longest-serving member, marks a particularly rapid shift in fortunes. Worth $525 billion in 2007 and more than $450 billion as recently 2014, the stock had fallen in four of six years before 2020 and is down another 40% since January. It’s now worth about $180 billion.

The latest reshuffling comes as technology companies have surged past every other industry in a trend amplified by this year’s Covid 19 lockdowns. …
https://www.bloomberg.com/news/articles/2020-08-24/dow-industrials-kicks-out-exxon-in-biggest-shakeup-since-2013
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Ken Feldman

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Re: Oil and Gas Issues
« Reply #3909 on: August 25, 2020, 06:00:35 PM »
Layoffs continue in the shale patch.  If the US had decent economic and energy policies (which may happen in January 2021), those laid off oil workers could be re-employed drilling wells for geothermal power plants or fixing leaking abandoned oil and gas wells.

https://oilprice.com/Energy/Energy-General/Two-Major-Shale-Drillers-Plan-Layoffs.html

Quote
Two Major Shale Drillers Plan Layoffs
By Irina Slav - Aug 25, 2020

Two shale producers have plans to start cutting jobs, sources in the know who wished to remain unnamed have told Reuters.

Parsley Energy plans to cut 10 percent of all 496 jobs it has created. The number of layoffs at Pioneer Natural Resources remains a secret, but its total workforce is about 2,300 people.

Quote
Parsley, which had earlier called for mandatory production cuts in Texas, reported a net loss of some $400 million for the second quarter of the year. On the positive side, the company boasted positive free cash flow during the quarter and a lease operating expense of just $3.69 per barrel. Still, this was not enough to make it optimistic for the immediate future and the company kept its oil price assumptions for the remainder of 2020 low, at $35 per barrel.

This is too low for most producers in the shale patch so the job cuts come as no surprise. They are only the latest additions to an already strong trend across the industry: the Texas Alliance of Energy Producers said earlier this year job losses since February exceeded 41,000. In April alone—the hardest month for oil prices—Texas oil shed as many as 25,000 jobs.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3910 on: August 25, 2020, 10:41:26 PM »
Global oil demand is not expected to reach previous highs due to Covid inspired changes.

https://oilprice.com/Latest-Energy-News/World-News/IHS-Oil-Demand-Growth-Will-Taper-Off.html

Quote
IHS: Oil Demand Growth Will Taper Off
By Julianne Geiger - Aug 25, 2020

Global oil demand growth—the very thing on which the entire state of the oil industry hinges—is expected to taper off, IHS Markit has said in its latest forecast.

Quote
Global oil demand is currently sitting at 89% of pre-pandemic levels, IHS Markit said. It is then expected to rise and level off at between 92% and 95% of the demand pre-pandemic.

Oil demand growth, therefore, will wane and plateau through Q1 2020 as fewer people are commuting to work, and as air travel slumps considerably amid remaining travel restrictions and people’s subdued appetite for air travel—particularly international air travel.

Quote
The forecast is borne out by the current data coming out of China, where jet fuel exports hit their lowest point since November 2011. So far, from January to July, China’s jet fuel exports were down 18% from the same period a year ago. And the monthly trend isn’t great either, with July down 77% from a year earlier, and 60% down from June.

vox_mundi

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Re: Oil and Gas Issues
« Reply #3911 on: August 26, 2020, 03:04:50 AM »
Battered by coronavirus, US oil now braces for Hurricane Laura
https://www.aljazeera.com/ajimpact/battered-coronavirus-oil-braces-hurricane-laura-200825194241950.html

Oil producers on Tuesday had evacuated 310 offshore facilities and shut 1.56 million barrels per day (bpd) of crude output, 84 percent of Gulf of Mexico's offshore production, near the 90 percent outage that Katrina brought 15 years ago.

Refiners that produce petrol and diesel fuel were taking steps to halt eight coastal facilities with nearly 2.78 million bpd of processing, 14.6 percent of the US total capacity, according to Reuters News Agency tallies.

Cheniere Energy Inc, the largest US exporter of liquefied natural gas, evacuated staff and suspended operations at its Sabine Pass LNG export terminal on the Texas/Louisiana border.

Motiva Enterprises, Total SA and Valero Energy began cutting operations at their Port Arthur, Texas, refineries, according to people familiar with the matter.

Total, Motiva and Valero confirmed the shutdowns, and a Valero spokeswoman said it also was reviewing the risks to its Texas City, plant southeast of Houston.

Citgo Petroleum said it has begun to halt processing at its 418,000-bpd refinery in Lake Charles, Louisiana.

Exxon Mobil Corp also began shutting production at its large Beaumont, Texas, refinery and reduced output at its Baytown, Texas, plant in advance of a possible shutdown.

If the Baytown plant fully halts processing, total shutdowns along the coast would hit 2.78 million bpd.
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KiwiGriff

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Re: Oil and Gas Issues
« Reply #3912 on: August 26, 2020, 03:58:21 AM »
Exxon Mobil dropped from the Dow after 92 years, replaced by a software stock

Quote
In its biggest reshuffle in several years, the Dow Jones Industrial Average is removing its longest-serving member: Exxon Mobil Corp.

The change was prompted by Apple’s forthcoming split, set to happen at Friday’s market close, which will leave the stock at one-quarter of its current price, Bloomberg News reported.

As opposed to the market-cap-weighted S&P 500 index, the Dow weights its members by price rather than market value. If a stock’s price falls too much, it can have a notable impact on the 124-year old index, according to Barron's.

To offset the decrease, the blue-chip Dow  will replace Exxon Mobil with cloud-based software company Salesforce. Founded in 1999, Salesforce's stock has risen 27-fold since March 2009, according to Bloomberg News.


Energy giant Exxon Mobil, the oldest member of the index, joined the Dow in 1928 as Standard Oil of New Jersey. The Dow's last original member, General Electric, was removed in 2018, CBS News reported.

While Exxon Mobil was worth more than $450 billion as recently as 2014, according to Bloomberg News, the stock had fallen throughout the six years before 2020 and is down another 40 percent since January.
https://www.chron.com/news/houston-texas/article/Exxon-Mobil-dropped-from-the-Dow-after-92-years-15512970.php
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gerontocrat

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Re: Oil and Gas Issues
« Reply #3913 on: August 26, 2020, 10:39:58 PM »
Latest data from the US EIA Monthly Energy Review released today - 26 Aug

Natural gas use  is very resilient.

Also of note is that while we always look at the use of natural gas in electricity production, that is only just over one third of the total use, just a bit more than used by industry. Replacing gas with wind and solar may be the easy bit.

Petroleum

The most striking thing is how little change there has been in petroleum products supplied over so many years.

The relatively easy bit might be EVs replacing gasoline.
However, that is less than half of the use of petroleum products.

The next largest use is for heating - both domestic and industry.

Then comes aviation.
Petroleum products supplied to Aviation
Jan-2020   296.22
Feb-2020   269.07
Mar-2020   245.06
Apr-2020   118.54
May-2020   106.80
Jun-2020   131.16
Jul-2020   192.79

Note the rebound in July. But is it a recovery?
_______________________________________
click on an image for full-size
« Last Edit: August 26, 2020, 11:37:30 PM by gerontocrat »
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Ken Feldman

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Re: Oil and Gas Issues
« Reply #3914 on: September 02, 2020, 07:26:51 PM »
US gasoline demand has flatlined well-below pre-Covid levels.  Hopes for a "V-shaped" economic recovery have fizzled as reality is settling in for the oil industry.

https://oilprice.com/Energy/Crude-Oil/Oil-Price-Rally-Stalls-As-US-Fuel-Demand-Falters.html

Quote
Oil Price Rally Stalls As U.S. Fuel Demand Falters
By Tsvetana Paraskova - Sep 02, 2020

Oil prices rallied after touching multi-decade lows in April, but they have been stuck in a narrow trade band for two months now as the pent-up U.S. demand rebound in June has fizzled out with flattening fuel consumption that continues to struggle to reach pre-pandemic levels.   Analysts and economists have already largely ruled out the idea of a V-shaped recovery in demand that could drive oil prices up.

Quote
COVID-19 related travel restrictions and continued consumer caution in some U.S. states after the resurgence of coronavirus infections have kept U.S. gasoline demand well below year-ago levels in the summer driving season. Gasoline demand had materially improved from the April lows until June, but after that it has been stuck at below 9 million bpd between end-June and mid-August, before rising to 9.161 million bpd in the week to August 21, EIA data shows.

Despite the rise in that week, demand is still off the 9.9-million-bpd seen during the same week last year, suggesting that this summer driving season will end without gasoline demand returning to pre-pandemic levels.

Crude oil inputs at U.S. refineries are still 15 percent lower than they were at this time last year, while refinery capacity utilization was 82.0 percent in the week to August 21 compared to 95.2 percent in same week of 2019, EIA data shows.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3915 on: September 02, 2020, 07:29:53 PM »
Globally, oil demand is around 90% of pre-Covid shut-in demand.

https://oilprice.com/Energy/Crude-Oil/Russia-Wants-OPEC-To-React-To-Oil-Demand-Recovery.html

Quote
Russia Wants OPEC+ To React To Oil Demand Recovery
By Tsvetana Paraskova - Sep 02, 2020

Russia will propose to OPEC+ to react to the recovery in global oil demand, which has now reached 90 percent of the levels seen before the pandemic, Russia's Energy Minister Alexander Novak said on Wednesday.

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According to Russia's energy minister, global oil demand will return to pre-pandemic levels at some point in 2021.

Quote
As part of the OPEC+ deal, Russia's oil production will drop by 13.8 percent year-on-year between August and December 2020, Novak added. Russia's full-year oil production will be 10 percent lower in 2020 than it was in 2019, he said.

In August, when OPEC+ started easing the record cuts by 2 million bpd, Russia's oil production rose by 5 percent from July, to reach 9.86 million bpd, according to Reuters' estimates of energy ministry data in tons.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3916 on: September 03, 2020, 12:53:34 AM »
Bankruptcies continue in the US shale patch.  And unlike previous economic downturns, other companies aren't buying the bankrupt companies assets. 

https://oilprice.com/Energy/Crude-Oil/Why-No-One-Is-Buying-Up-Shale-Assets.html

Quote
Why No One Is Buying Up Shale Assets
By Irina Slav - Sep 02, 2020

Since the start of the year, 57 oil production and oilfield services companies have filed for Chapter 11 bankruptcy protection. Many more bankruptcies are on the way, all in the shale patch. And there does not seem to be even a shred of light at the end of this tunnel. The U.S. shale patch was the pride and joy of the nation’s energy industry. Rightly called a shale revolution, the boom in oil and gas production fueled by hydraulic fracturing turned the United States into the world’s largest oil and gas producer. But this had a cost—a cost that is now being paid with a flurry of bankruptcies.

Rystad Energy said last month it expected another 150 U.S. shale oil companies would file for Chapter 11 protection by the end of the year unless prices rise above $50 a barrel. Others have suggested we might see consolidation, the way the industry consolidates during every crisis, but this time around, that seems unlikely.

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The last oil price crisis, the one that did spark a consolidation wave after 2014, was a typical one. Prices dropped, some companies failed, others were bought up by bigger ones, prices rebounded, and production growth was back on track. Investors, however, began to insist on returns instead of growth. Producers were trying to get there when this year’s crisis hit. It is no surprise that potential buyers are wary.

Debt is a major turn-off. Shale drillers took on debt the way squirrels store nuts for winter. Shale oil production is a capital-intensive business, but this aspect of it was for a long time overshadowed by the fact that oil starts flowing a lot more quickly from a fracked shale well than a conventional one. So drillers took on debt and boosted production to repay this debt. It became a vicious circle that the last crisis may have well put a stop to.

Banks became reluctant to extend shale oil drillers’ credit lines even before the Saudis turned the taps on and Covid-19 spread across the world. New wells were not yielding as much as borrowers had said they would, and debt piles were growing. Then the pandemic came, and drillers started falling under the twin weight of billions in debt and $20 oil.

Again, these falls mean there is cheap acreage for sale, and some of it may well be excellent acreage. But there is one more reason in addition to general wariness why there are few buyers: the industry does not seem to believe that there will be a third shale revolution.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3917 on: September 03, 2020, 07:44:44 PM »
Sometimes a headline fails to capture the essence of a story.

https://oilprice.com/Latest-Energy-News/World-News/US-Jet-Fuel-Demand-Recovers-Faster-Than-Expected.html

The headline:
Quote
U.S. Jet Fuel Demand Recovers Faster Than Expected
By Charles Kennedy - Sep 02, 2020

The rosy lead supporting the headline:

Quote
Jet fuel demand in the United States is recovering faster than in many other regional markets such as Europe and Asia minus China, the U.S. Energy Information Administration (EIA) said on Tuesday.

The supporting data:

Quote
Consumption of jet fuel by U.S. commercial passenger flights was approximately 612,000 barrels per day (bpd) as of August 16, which was 43 percent of the estimated volumes of jet fuel consumed on the same date last year, the EIA has estimated using raw flight data from Cirium. From the end of April through May, U.S. jet fuel consumption by commercial flights was below 20 percent, the estimates show.   

Granted, it is a recovery of sorts from April and May, but that headline and first paragraph implied that demand is much higher than the data show.

The story also has data from China, which we've been lead to believe is consuming nearly as much oil as last year:

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China’s jet fuel consumption was 60 percent of the volumes consumed last year, the EIA has estimated.

The story concludes:

Quote
A very slow recovery in jet fuel demand will drag on global oil demand for at least another two years as overall passenger traffic numbers continue to be low, and mandatory quarantines continue to prevent people from traveling on international flights.

Sigmetnow

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Re: Oil and Gas Issues
« Reply #3918 on: September 08, 2020, 07:52:44 PM »
Oil drops 8% to multi-month low on demand fears
Sept 8
Quote
Oil prices tumbled to their lowest level since June on Tuesday amid growing demand concerns as Covid-19 continues to spread.

West Texas Intermediate crude, the U.S. oil benchmark, slipped $3.19, or 8%, to trade at $36.60, its lowest level since June 16. International benchmark Brent crude dipped 5.4%, or $2.26, to trade at $39.75, also its lowest level since June.

"Today's oil price move is a clear sign that the market now seriously worries about the future of oil demand," said Paola Rodriguez-Masiu, senior oil markets analyst at Rystad Energy. "The streak of losses is driven by a stalling crude demand outlook for the rest of the year, with rising cases of Covid-19 and the end of the summer driving season in the U.S., as well as Asian refineries putting on [the] [brakes]," she added.

...
Tuesday's move lower followed Saudi Aramco cutting its official selling prices for October, which RBC's Helima Croft said triggered new demand concerns.

In a recent note to clients, Bank of America said that it will take three years for demand to recover from Covid-19, assuming there's a vaccine or cure. The firm believes peak oil will come as soon as 2030 due in part to electric car proliferation. ...
https://www.cnbc.com/2020/09/08/oil-drops-to-multi-month-low-on-demand-fears.html
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Ken Feldman

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Re: Oil and Gas Issues
« Reply #3919 on: September 10, 2020, 07:02:39 PM »
I'm linking to an interesting article with some forecasts of peak oil demand before 2030 and proposals in the USA and Canada to plug abandoned oil and gas wells.

https://www.resourcesmag.org/common-resources/look-you-leap-three-governance-challenges-taxpayer-funded-cleanup-oil-and-gas-wells/

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09.09.20  /  Common Resources
Look Before You Leap: Three Governance Challenges for Taxpayer-Funded Cleanup of Oil and Gas Wells

Daniel Raimi and Nathan Lemphers

These are challenging times for the oil and gas industry. While volatility is no stranger to the sector, the bust of 2020 may signal the beginning of a new era, especially for high-cost producers. Global oil prices have plunged in response to a glut of supply and a historic drop in demand, driven by fears over COVID-19. At the same time, investors and consumers are increasingly pressuring governments and companies to move toward net-zero emissions by 2050.

Even before the pandemic, expected declines in oil demand from the increased use of electric vehicles and other policy-driven market shifts were causing some firms, such as energy advisor DNV GL, to project the demand for oil to peak in the early 2020s. Under scenarios that achieve the Paris Agreement’s target of limiting global warming to “well below” 2 degrees Celsius in this century, oil demand will peak in the mid-2020s, according to modeling by BP, Equinor, and the International Energy Agency. In the wake of this near-term drop and deep uncertainty about the future, oil and gas companies around the world are taking write-downs worth tens of billions of dollars, and many US firms are entering bankruptcy.

These trends have illuminated a longstanding problem for the oil and gas industry in North America: the challenge of managing millions of abandoned and orphaned oil and gas wells.

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Interest in the issue has grown in Washington, DC. The House of Representatives recently passed the “Moving Forward Act” (see Section 84101), which earmarks $400 million for reclaiming wells. Democratic presidential nominee Joe Biden has similarly pledged to create hundreds of thousands of jobs by directing federal funds to clean up wells. In the meantime, states like North Dakota are using federal recovery funds to plug newly orphaned wells.

Lawmakers in Canada have moved more quickly. The Canadian federal government has allocated $1.3 billion (C$1.7 billion) to British Columbia, Alberta, and Saskatchewan to clean up orphaned and abandoned wells. This announcement received unusually broad political support at the provincial and federal levels, as well as praise from environmental groups and the oil industry.

But despite the potential appeal of these efforts across both countries, considerable challenges could get in the way of rapidly carrying out a large-scale plugging program, reforming existing laws and regulations, and addressing the lack of incentives for companies to manage this problem on their own. We discuss each of these issues, and options for addressing them, below.

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To ease this capacity crunch, state regulators could raise additional funds from companies to pay for increased regulatory capacity. Although the prospect of increasing costs for a struggling industry may not appeal to some policymakers, two recent studies have found that increasing bonding requirements in Texas and North Dakota had little to no effect on the rate of new drilling in those states.

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Re: Oil and Gas Issues
« Reply #3920 on: September 10, 2020, 07:11:28 PM »
No new LNG projects have been approved in the North America this year, the first time that's happened since 1998.

https://energy.economictimes.indiatimes.com/news/oil-and-gas/opinion-lng-investments-vanish-in-2020-as-coronavirus-slashes-oil-and-gas-prices/78029859

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Opinion: LNG investments vanish in 2020 as coronavirus slashes oil and gas prices

In a stark contrast to last year's record level of approvals for LNG production plants, 2020's dramatic oil and gas price drop has forced companies to delay decisions on new projects and write down investments in existing plants
Reuters
September 10, 2020

LONDON/NEW YORK: No new liquefied natural gas (LNG) export projects could be approved this year for the first time in at least two decades, banking and industry sources said, after the COVID-19 pandemic drove down energy demand and knocked prices to all-time lows.

In a stark contrast to last year's record level of approvals for LNG production plants, 2020's dramatic oil and gas price drop has forced companies to delay decisions on new projects and write down investments in existing plants.

The last year in which no new LNG exports plants were approved was 1998, consultancy Wood Mackenzie told Reuters, while the International Energy Agency estimated it was at least two decades ago.

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Giovanni Bruni and Alessandro Agosta, partners at McKinsey & Company, said they expect all pre-FID projects to be delayed by 1 to 2 years due to CAPEX cuts and deferrals, plus difficulty in securing buyers.

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In the United States, there may be no room for new projects until the middle of the decade after record new capacity was added last year, with a delay in investments helping the market balance, analysts say.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3921 on: September 11, 2020, 06:24:52 PM »
Oil demand is not recovering as quickly as predicted.  Storage is filling up again because producers increased production but demand didn't increase.

https://oilprice.com/Energy/Crude-Oil/Floating-Storage-Begins-To-Fill-Up-As-Oil-Demand-Wavers.html

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Floating Storage Begins To Fill Up As Oil Demand Wavers
By Irina Slav - Sep 10, 2020

Huge floating oil storage builds earlier this year became a major cause for oil price falls as the pandemic wiped out demand. Then, as OPEC+ started cutting production and countries began emerging from lockdowns, floating storage inventories began to decline, boosting prices. Now, they’re creeping up again--but this time, it’s fuel inventories.

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It’s not just diesel and gasoil. All distillate fuel stocks are a problem. In the United States, refiners have been struggling with rising distillate inventories for weeks now as air travel remains severely restricted, jet fuel demand is in the ditch, and there are no alternative venues for the oil product. Refiners have been raising their gasoline production, but demand for gasoline has also been slow to recover and inventories there also remain above the five-year average despite several hefty draws.

The trend is certainly worrying for those banking on an oil price rebound driven by fuel demand recovery, which is pretty much everyone who produces fuels. Demand was expected to recover more or less consistently after the lockdowns barring a second wave of infections. But while some countries have indeed experienced what looks like two distinct waves of Covid-19 infections, for others, including the world’s largest oil consumer globally, the U.S., it has been a single but prolonged wave. Uncertainty about pretty much everything from employment to vaccine development remains ample, and this is affecting oil demand.

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What this suggests is that refiners restarted crude buying earlier this year in anticipation of a rebound in demand for fuels. This rebound, however, never came to pass, and now refiners—and commodity traders—are stuck with millions of barrels of fuels they can’t sell. What makes things worse is that the latest data on oil demand, particularly from China, is not encouraging at all. Earlier this month Saudi Arabia’s Aramco served an unpleasant surprise to oil markets by announcing it was sharply cutting its official selling prices for oil. The cuts would affect Asian, U.S., and northwestern European clients. Meanwhile, worry has been growing that China had stuffed itself with cheap oil and its buying spree, which helped prices stay stable during the summer, was coming to an end.

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Re: Oil and Gas Issues
« Reply #3922 on: September 11, 2020, 08:00:40 PM »
Construction of a new oil pipeline in the Texas Permian oil field has been cancelled.  That's a sign that we've seen peak production from this oil field.

https://www.worldoil.com/news/2020/9/10/enterprise-cancels-major-permian-crude-pipeline-project

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Enterprise cancels major Permian crude pipeline project
By Sheela Tobben on 9/10/2020

(Bloomberg) --Enterprise Products Partners LP became the first to abandon a major crude pipeline in the heart of America’s shale patch on Wednesday in what may be yet another sign that the pandemic-fueled rout in U.S. oil markets isn’t over.

With lockdowns across the nation eviscerating fuel demand, Enterprise shelved plans to add 450,000 barrels a day of capacity to a system that carries oil from Texas’s Permian basin to the U.S. Gulf Coast. It joins scores of oil explorers, contractors and pipeline giants that have slashed billions of dollars in investments amid a swelling supply glut that sent crude prices plummeting earlier this year.

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But the loss of demand cannot only be blamed. Even before Covid-19, tight oil production growth had been declining with investors demanding higher dividends and spending discipline.

Supply has slumped enough to create a “vision that oil infrastructure is in surplus,” said Raoul LeBlanc, an analyst at IHS Markit Ltd. Infrastructure was set up to meet the needs for oil output and demand of about 100 million barrels a day globally, but that has declined to about 90 million barrels a day now, so another pipeline is not needed, he said.

vox_mundi

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Re: Oil and Gas Issues
« Reply #3923 on: September 12, 2020, 07:18:02 PM »
Second-Wave Oil Glut May Be Near
https://www.bloomberg.com/news/articles/2020-09-11/oil-traders-snap-up-tankers-in-sign-second-wave-glut-may-be-near

Some of the world’s biggest oil traders are gearing up for a possible resurgence of a coronavirus-induced glut of crude and fuels, snapping up giant tankers for months-long charters so that they can be ready to store excess barrels if necessary.

The chartering spree is likely to alarm Saudi Arabia, Russia and their allies as it indicates that the oil traders believe the crude market is moving into a surplus after OPEC+ managed to create a deficit earlier this summer with its output cuts.
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Re: Oil and Gas Issues
« Reply #3924 on: September 15, 2020, 12:57:58 AM »
BP is forecasting that we reached peak oil demand in 2019.

https://www.cnn.com/2020/09/14/business/bp-oil-demand-peak-coronavirus/index.html

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The world may never consume more oil than in 2019, BP says
by Hanna Ziady, CNN Business
Mon September 14, 2020

London (CNN Business)Demand for oil may have peaked last year, according to BP, which says the global market for crude might never recover from the coronavirus pandemic.

In a new report published on Monday, the company lays out three scenarios for energy demand, all of which forecast a decline in demand for oil over the next 30 years. The scale and pace of the decline will be driven by the increasing efficiency and electrification of road transportation, BP (BP) said.

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The new report is a major change from last year, when BP expected growth in oil demand to continue into the 2030s.

The shift reflects the profound effect that the pandemic, which brought travel and manufacturing to a near standstill, has had on global energy markets. Analysts think the crisis will accelerate the shift away from fossil fuels towards renewable forms of energy, particularly as governments and investors heap pressure on companies to tackle the climate crisis amid growing evidence of its devastating effects.

sidd

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Re: Oil and Gas Issues
« Reply #3925 on: September 16, 2020, 12:37:50 AM »
(USA) Mernit at capital and main: Democrat might be appointed to the Texas Railroad Commission

"nothing to do with railroads  ... For more than a century the commission’s job has been to ensure that the state’s oil-and-gas resources go to good use and sell for a fair price. "

"Two candidates are vying for the position: an upstart outsider, Republican Jim Wright, who unexpectedly prevailed over incumbent Ryan Sitton in the primary; and Dallas-based oil-and-gas attorney, Democrat Chrysta Castañeda"

"No Democrat has served on the commission since 1994"

"Wright has handed her an opening: Not only has the railroad commission itself fined the oil-waste disposal company he founded, DeWitt Recyclable Products, $181,000 for violations including allowing toxic waste to pile up and leak into the soil, but other oilfield service operators have sued him for fraud."

"everyone agrees it would be better to do what the commission ordered operators to do in 1947: Capture the wasted gas and put it to beneficial use. Back then, the Texas Railroad commissioners ordered 615 wells shut down in the South Texas Seeligson Field unless drillers there put an end to their profligate incineration of valuable gas."

"“The actual rule says, ‘Thou shall not flare, except,” Leyden said. “The problem is that the except has grown larger and larger to the point of being meaningless.” "

"“The only way flaring isn’t against the law is if [a driller] gets an exception permit.” There were nearly 7,000 permits granted last year, all of them on a “consent” agenda. “And consent,” she said, “takes three people.”"

https://capitalandmain.com/race-obscure-texas-office-could-have-lasting-impact-climate-change-0910

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gerontocrat

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Re: Oil and Gas Issues
« Reply #3926 on: September 21, 2020, 04:24:43 PM »
Australia sometimes makes the Texas Railroad Commission look like amateurs in perfidy.

https://www.theguardian.com/commentisfree/2020/sep/21/senator-ian-the-climate-denialist-potato-on-the-governments-plans-for-gas

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Re: Oil and Gas Issues
« Reply #3927 on: September 21, 2020, 11:26:31 PM »
Green Chemistry is making progress on replacing oil and gas as chemical feedstocks.  Currently, the chemical industry accounts for 15% of oil demand.

https://oilprice.com/Energy/Energy-General/Why-Big-Oil-Should-Worry-About-The-Green-Chemistry-Movement.html

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Why Big Oil Should Worry About The Green Chemistry Movement
By Tsvetana Paraskova - Sep 21, 2020

While climate activists call on oil and gas giants to ‘keep it in the ground,’ many products of our modern way of life – from clothing and cosmetics to detergents and medicines – come from the biggest industrial consumer of both oil and gas - the chemical sector.  The chemicals industry has heeded calls for emissions reduction and is looking at ways to make the processing of fossil fuel raw materials less carbon-intensive. 

But proponents of the so-called green chemistry believe that much more can be done to make the industry sustainable, avoiding unintended consequences such as harm to people and the environment while at the same time reducing waste, conserving energy, and discovering replacements for hazardous substances. 

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The chemical sector is the largest industrial consumer of both oil and gas, accounting for 15 percent, or 13 million bpd, of total primary demand for oil on a volumetric basis and 9 percent of gas, according to the International Energy Agency (IEA).

Chemical sector emissions need to peak in the next few years and decline towards 2030 to stay on track with the Sustainable Development Scenario (SDS), according to the agency.

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Every sector of the chemicals industry uses some form of green chemistry, be it recycling or using waste as a resource, but the sector hasn’t adopted yet the sustainable principles systematically, Anastas says.

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Scientists are constantly working on finding sustainable alternatives to chemical processes and materials.

Scientists at the Max Planck Institute of Colloids and Interfaces in Potsdam, Germany, for example, have developed a green approach to the selective synthesis of p-xylene pXL, one of the most important building blocks in the polymer industry, from renewable raw materials. Production of pXL is still based on fossil raw materials. 

Green chemistry is already part of many consumer products. Adidas, for example, makes shoes from recycled plastic waste.

San Diego-based Genomatica has created natural butylene glycol, commonly used in cosmetics for moisture retention and as a carrier for plant extracts. Butylene glycol is traditionally produced from fossil fuels, but Genomatica produced by fermenting E. coli using renewable sugars, for which it received U.S. Environmental Protection Agency’s (EPA) award in the 2020 Green Chemistry Challenge Awards.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3928 on: September 22, 2020, 08:03:16 PM »
US industrial consumption of natural gas is down due to the recession.  At the peak of the Covid shutdowns in May it was down 8% from the same time last year.

https://oilprice.com/Energy/Natural-Gas/US-Industrial-Demand-For-Natural-Gas-Drops-As-Economy-Slows.html

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U.S. Industrial Demand For Natural Gas Drops As Economy Slows
By Tsvetana Paraskova - Sep 21, 2020

The U.S. industrial sector saw its consumption of natural gas drop as economic activity slowed with the lockdowns in response to the COVID-19 pandemic, the U.S. Energy Information Administration (EIA) said on Monday.

Industrial consumption of natural gas fell from 25.4 billion cubic feet per day (Bcf/d) in January 2020 to 20.1 Bcf/d in June 2020, the EIA’s Natural Gas Monthly showed.

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This year, consumption of natural gas by the industrial sector hit its lowest point in May, when it slumped by 8 percent compared to the same month of last year. Industrial consumption of natural gas in May 2020 marked the largest year-over-year decline since July 2009, during the 2007–2009 recession.

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This year, consumption of natural gas by U.S. industries is expected to drop by 4.4 percent year over year, according to the EIA Short-Term Energy Outlook for September 2020.

EIA expects that total U.S. consumption of natural gas will average 82.7 Bcf/d this year, down by 2.7 percent year over year, with the industrial sector posting the largest decline in consumption, according to the latest STEO.

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Re: Oil and Gas Issues
« Reply #3929 on: September 23, 2020, 01:25:56 AM »
Jet fuel accounted for 8% of total global oil demand in 2019.  Aviation traffic is down by 50% and showing no signs of further recovery while the Covid pandemic rages on.

https://oilprice.com/Energy/Energy-General/Will-Jet-Fuel-Demand-Ever-Recover.html

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Will Jet Fuel Demand Ever Recover?
By Tsvetana Paraskova - Sep 22, 2020

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Global commercial air traffic slowed its recovery pace in August, sending a warning to the oil market that jet fuel demand would likely take at least three more years to reach pre-crisis levels—if it ever did.

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At peak lockdowns in Europe, when air traffic in the continent was down 89 percent from 2019 levels, air traffic management agency Eurocontrol had predicted that traffic would gradually recover to reach 15 percent below 2019 levels in February 2021. The latest estimate from Eurocontrol, however, sees traffic weakening after August and staying at 50 percent lower than 2019 in February next year.

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The reduced consumer confidence amid blanket quarantine measures in many European countries, some of which were (re)imposed overnight, has played a major role in the lack of meaningful air travel recovery since July. Major European air carriers and aircraft makers are now even more pessimistic than they were during the nearly Europe-wide national lockdowns in April.

“The survival of Air France-KLM is not a given,” Dutch Finance minister Wopke Hoekstra said on Dutch TV earlier this month. The Dutch and French governments, both of which hold minority stakes in Air France-KLM, have already helped the airline with financial aid packages. Air France-KLM and all airlines are cutting jobs and warn that those job cuts would deepen.

Germany’s Lufthansa said on Monday that it would further cut its fleet and personnel numbers as “the outlook for international air traffic has significantly worsened in recent weeks” amid “significantly lower air traffic recovery than what was expected in summer.”

France’s aircraft manufacturer Airbus told employees that layoffs were coming as voluntary redundancies would not be enough to cut costs.

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The significantly lower airline passenger traffic and the significantly lower-than-expected recovery in the summer is dooming jet fuel demand for years to come.

Aviation fuel demand accounted for just 8 percent of total global oil demand in 2019, but the slump in the industry means that jet fuel will continue to be a drag on oil demand for at least another three to four years, even if demand for road transportation fuels returns to pre-pandemic levels sooner.

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Re: Oil and Gas Issues
« Reply #3930 on: September 25, 2020, 12:34:34 PM »
Africa Is The Undeniable Final Frontier For Oil
https://oilprice.com/Energy/Crude-Oil/Africa-Is-The-Undeniable-Final-Frontier-For-Oil.html
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The pandemic has been devastating for the oil industry globally. Explorers suspended drilling, producers, idled wells, Big Oil majors put up assets for sale. But the world continues to need oil, albeit lower amounts of it than a year ago, and it will continue to need it. Exploration is not dead. It is especially not dead in Africa—a hot spot in oil and gas before the pandemic.
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Re: Oil and Gas Issues
« Reply #3931 on: September 25, 2020, 01:31:42 PM »
Monthly update from US Energy Information Administration (EIA)
https://www.eia.gov/totalenergy/data/monthly/

Petroleum products supplied in August 2020 still 14% below August 2019.
Natural gas consumed in June 2020 back to consumption one year ago, while use for electricity up by 5% from one year before - coal out, gas in.

12 month trailing average also shoes natural gas consumption far more resilient than petroleum products. Aviation and driving activity clobbered by Covid.

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Re: Oil and Gas Issues
« Reply #3932 on: September 30, 2020, 12:43:24 PM »
Virus-Hit Shell Says Cutting Up to 9,000 Jobs By 2022
https://techxplore.com/news/2020-09-virus-hit-shell-jobs.html

Energy major Shell unleashed Wednesday a major restructuring to combat plunging oil prices driven by the coronavirus pandemic, warning it will also spark more asset writedowns in the third quarter.

Royal Dutch Shell said in a statement that it would axe between 7,000 and 9,000 positions by the end of 2022, of which 1,500 staff have already agreed to take voluntary redundancy this year.

The job cuts would amount to roughly 10 percent of Shell's total global workforce of 80,000 staff across more than 70 countries.

Shell's main British rival BP is axing around 10,000 jobs or 15 percent of its total workforce in response to the virus turmoil.
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Re: Oil and Gas Issues
« Reply #3933 on: October 01, 2020, 12:11:38 PM »
Downward spiral continues in U.S. shale as 190 companies teeter on brink of bankruptcy
https://financialpost.com/financial-times/downward-spiral-continues-in-u-s-shale-as-190-companies-teeter-on-brink-of-bankruptcy
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Investors are fed up: From credit investors and banks to equity investors, there is a reluctance to throw good money after bad
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Re: Oil and Gas Issues
« Reply #3934 on: October 01, 2020, 11:33:34 PM »
The cost to clean up abandoned oil wells in Texas is estimated at over $100 Billion.

https://oilprice.com/Latest-Energy-News/World-News/Texas-Taxpayers-Face-117-Billion-Bill-For-Orphaned-Oil-Wells.html

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Texas Taxpayers Face $117 Billion Bill For Orphaned Oil Wells
By Josh Owens - Oct 01, 2020

The state of Texas and its taxpayers could be on the hook for paying up to US$117 billion for the cleaning-up of abandoned wells as a growing number of U.S. oil companies go bust, and the guarantees for paying for the cleanup cover only 1 percent of estimated costs, a report by climate finance think-tank Carbon Tracker showed on Thursday. 

U.S. oil and gas producing states and taxpayers may have to pay in total as much as US$280 billion in cleanup costs, with Texas leading with US$117 billion, followed by Oklahoma with US$31 billion and Pennsylvania with US$15 billion, Carbon Tracker’s report says.

The US$280-billion estimate is for 2.6 million unplugged onshore oil and gas wells in the United States, while there may be another estimated 1.2 million undocumented onshore wells, Carbon Tracker said.

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Re: Oil and Gas Issues
« Reply #3935 on: October 02, 2020, 06:02:11 AM »
Not even the people who work in fossil fuel extraction want to do it.

https://www.theguardian.com/commentisfree/2020/sep/29/fossil-fuel-workers-transition-renewables-covid

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Re: Oil and Gas Issues
« Reply #3936 on: October 05, 2020, 07:16:19 PM »
EXXON - only bankruptcy will stop them....


https://www.bloomberg.com/news/articles/2020-10-05/exxon-carbon-emissions-and-climate-leaked-plans-reveal-rising-co2-output
Exxon’s Plan for Surging Carbon Emissions Revealed in Leaked Documents
Internal projections from one of world’s largest oil producers show an increase in its enormous contribution to global warming

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Exxon Mobil Corp. has been planning to increase annual carbon-dioxide emissions by as much as the output of the entire nation of Greece, an analysis of internal documents reviewed by Bloomberg shows, setting one of the largest corporate emitters against international efforts to slow the pace of warming.

The drive to expand both fossil-fuel production and planet-warming pollution comes at a time when some of Exxon’s rivals, such as BP Plc and Royal Dutch Shell Plc, are moving to curb oil and zero-out emissions. Exxon’s own assessment of its $210 billion investment strategy shows yearly emissions rising 17% by 2025, according to the internal documents.

The largest U.S. oil producer has never made a commitment to lower oil and gas output or set a date by which it will become carbon neutral, and its near-term plans have been disrupted by fallout from the Covid-19 pandemic. Exxon has also never publicly disclosed its forecasts for its own emissions.

But the planning documents show for the first time that Exxon has carefully assessed the direct emissions it expects from the seven-year investment plan adopted in 2018 by Chief Executive Officer Darren Woods. The additional 21 million metric tons of carbon dioxide per year that would result from ramping up production dwarfs Exxon’s projections for its own efforts to reduce pollution, such as deploying renewable energy and burying some carbon dioxide.

The additional 21 million metric tons of carbon dioxide per year that would result from ramping up production dwarfs Exxon’s projections for its own efforts to reduce pollution, such as deploying renewable energy and burying some carbon dioxide.

The emissions projections are “an early assessment that does not include additional mitigation and abatement measures that would have been considered as the next step in the process,” Exxon said in a statement. “The same planning document illustrates how we have been successful in mitigating emissions in the past.”

Exxon often defends its growth plans by citing International Energy Agency estimates that trillions of dollars of new oil and gas investments are needed by 2040 to offset depletion from existing operations, even under a range of climate scenarios. However, experts say a reduction in global oil and production is necessary to limit warming to 1.5 degrees Celsius above pre-industrial levels.

Exxon’s ambitious growth plans, calling for higher cash flow and a doubling of earnings by 2025, are a vestige of pre-pandemic times. The industry has been hard hit by Covid-19, which destroyed demand for oil and sent prices into a tailspin. “As demand returns and capital investments resume,” Exxon added in the statement, “our growth plans will continue to include meaningful emission mitigation efforts.”

The collapse of oil demand forced Exxon to cut its spending budget by a third in April, and its share price is currently hovering near an 18-year low. Exxon was removed from the Dow Jones Industrial Average earlier this year. The company last week warned of a third consecutive quarterly loss, meaning it’s relying on debt to pay capital expenditures and dividends.

As recently as July, however, Exxon indicated that it’s merely delaying many projects to preserve cash during the downturn rather than canceling them. Fulfilling the plan would mean producing an additional 1 million barrels of oil a day. The emissions generated by the extra drilling and refining would increase the company’s greenhouse gas emissions to 143 million tons of CO₂ equivalent per year, the internal documents show.

“Exxon has repeatedly shopped for growth over the last 10 years, and their returns have suffered,” said Andrew Grant, head of oil, gas and mining at Carbon Tracker, a financial think tank. “Exxon is explicit that their business plan is informed by their own business outlook, which assumes continued demand growth for fossil fuels.”

The more than $30 billion-per-year investment plan was the centerpiece of Exxon’s March 2018 Investor Day. Woods declared an ambition to build a suite of high-quality operations that would produce large volumes of oil and gas for decades into the future, regardless of changes in policy or price. After years of struggling with stagnant production, Woods zeroed in on five key projects: shale oil in the Permian Basin, offshore oil in waters belonging to Guyana and Brazil, and liquefied natural gas in Mozambique and Papua New Guinea.
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vox_mundi

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Re: Oil and Gas Issues
« Reply #3937 on: October 07, 2020, 06:51:59 PM »
Unusually Shallow Earthquake Ruptures in Chinese Fracking Field
https://phys.org/news/2020-10-unusually-shallow-earthquake-ruptures-chinese.html

In the journal Seismological Research Letters, Hongfeng Yang of The Chinese University of Hong Kong and colleagues suggest that the magnitude 4.9 earthquake that struck Rongxian County, Sichuan, China on 25 February 2019 took place along a fault about one kilometer (0.6 miles) deep.

The earthquake, along with two foreshocks with magnitudes larger than 4, appear to be related to activity at nearby hydraulic fracturing wells. Although earthquakes induced by human activity such as fracking are typically more shallow than natural earthquakes, it is rare for any earthquake of this size to take place at such a shallow depth.

Two people died and twelve were injured in the 25 February earthquake, and the economic loss due to the event has been estimated at 14 million RMB, or about $2 million. There have been few historic earthquakes in the region, and before 2019 there had been no earthquakes larger than magnitude 3 on the fault where the main earthquake took place.

Since 2018, there have been at least 48 horizontal fracking wells drilled from 13 well pads in the region, with three well pads less than two kilometers (1.2 miles) from the Molin fault, where the main earthquake took place.

Hongfeng Yang et al, A Shallow Shock: The 25 February 2019 ML 4.9 Earthquake in the Weiyuan Shale Gas Field in Sichuan, China, Seismological Research Letters (2020
https://pubs.geoscienceworld.org/ssa/srl/article-abstract/doi/10.1785/0220200202/591405/A-Shallow-Shock-The-25-February-2019-ML-4-9
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vox_mundi

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Re: Oil and Gas Issues
« Reply #3938 on: October 07, 2020, 07:56:42 PM »
“There are three classes of people: those who see. Those who see when they are shown. Those who do not see.” ― Leonardo da Vinci

Insensible before the wave so soon released by callous fate. Affected most, they understand the least, and understanding, when it comes, invariably arrives too late

vox_mundi

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Re: Oil and Gas Issues
« Reply #3939 on: October 09, 2020, 03:16:52 PM »
Hurricane Delta Shuts Most U.S. Offshore Oil Output in 15 Years
https://mobile.reuters.com/article/amp/idUKL1N2H00GE

HOUSTON (Reuters) - A strengthening Hurricane Delta dealt the greatest blow to U.S. offshore Gulf of Mexico production in 15 years, halting most of the region's oil and nearly two-thirds of its natural gas output.

An already large and powerful storm, Delta could intensify further on Friday as it churns through the Gulf's prime oil-producing area. Its winds reached 120 miles per hour (195 kmh), according to the National Hurricane Center.

Delta has shut 1.67 million barrels per day, or 92% of the Gulf's oil output, the most since 2005 when Hurricane Katrina destroyed more than 100 offshore platforms and hobbled output for months.

In addition to oil, producers have halted nearly 62% of the region's natural gas output, or 1.675 billion cubic feet per day. Offshore Gulf of Mexico fields produce about 15% of U.S. crude oil and 5% of its natural gas production.

Total SA on Thursday began shutting an oil processing unit at its 225,500 barrel-per-day (bpd) Port Arthur, Texas, refinery because of the threat from Hurricane Delta, people familiar with plant operations said.
“There are three classes of people: those who see. Those who see when they are shown. Those who do not see.” ― Leonardo da Vinci

Insensible before the wave so soon released by callous fate. Affected most, they understand the least, and understanding, when it comes, invariably arrives too late

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3940 on: October 15, 2020, 09:59:36 PM »
While the news in the IEA World Energy Outlook 2020 was great for renewables, it was terrible for oil and gas.

https://oilprice.com/Energy/Energy-General/5-Major-Takeaways-From-The-IEAs-World-Energy-Outlook-2020.html

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5 Major Takeaways From The IEA's World Energy Outlook 2020
By Alex Kimani - Oct 14, 2020

A few years back, the fossil fuel sector was doing just fine while renewable and alternative energy investments were considered a wildcard because the sector was regarded as unchartered territory. But with the shift to clean energy and the war against climate change in full swing while fossil fuels continue to face their biggest existential crisis in history, the momentum has overwhelmingly shifted to lower carbon fuels. Paris-based International Energy Agency, IEA, has just released its flagship publication, the World Energy Outlook 2020, which provides a comprehensive view of how the global energy system could develop in the coming decades. The organization notes that this year’s exceptional circumstances require an exceptional approach, meaning the usual long-term modeling horizons have been retained, but the focus for the World Energy Outlook 2020 is firmly on the next 10 years, exploring in detail the impacts of the Covid-19 pandemic on the energy sector, and the near-term actions that could accelerate clean energy transitions.

The report is decidedly bearish for fossil fuel; however, the silver lining is this: A global economy on the skids will lead to the biggest drop in CO2 emissions on record with renewables playing an even bigger role in the electricity generation mix. In fact, the projected 2.4 gigatonnes (Gt) decline in annual CO2 emissions will dial the emissions clock back to where it was a decade ago.

Other than that, the report is mostly negative for the fossil fuel industry, so brace yourself.

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Bearing this in mind, here are some of IEA’s interesting findings

#1. Pandemic effects to be felt for decades

IEA says that global energy demand is set to drop by 5% in 2020, with energy investment dropping a shocking 18%.

But here’s the really bad news: In the best-case-scenario (STEP), global energy demand will not fully recover to pre-Covid-19 levels until 2023.

A slightly worse-case scenario (DRS) delays energy demand recovery by another two years to 2025.

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#2. Oil becomes the next tobacco sector

This is what oil bulls probably don’t want to hear: The oil sector could very much soon face the same fate as the tobacco sector by entering a phase of terminal decline.

The IEA has reiterated pretty much what oil bears have been saying: In a not-so-distant universe, renewable energy is likely to increasingly gain ascendancy while fossil fuels take a back seat.

Even in the best-case scenarios (STEPS and the DRS), oil demand will continue to rise but hit a plateau in the 2030s.

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#5. Solar becomes the new king of electricity



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The IEA has reported that so far, the renewables sector has proven to be the most resilient during the ongoing crisis.

Indeed, global use of renewable energy is likely to grow 1.0% Y/Y over the course of the year, mainly due to new wind and solar PV projects completed over the past year coming online. Renewables tend to be more resilient to lower electricity demand than other sources mainly because they are generally dispatched first due to favorable regulation and/or their lower operating costs.

While wind energy, especially offshore wind, is likely to continue enjoying robust growth, solar energy is likely to come out on top.

In a STEPS scenario, renewables will meet 80% of the growth in global electricity over the next decade. So far, hydropower has remained the largest renewable source of electricity’. However, the IEA has forecast that solar will be the main driver of growth as it sets new records for deployment each year after 2022, with onshore and offshore wind taking second and third place, respectively.

gerontocrat

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Re: Oil and Gas Issues
« Reply #3941 on: October 15, 2020, 10:30:48 PM »
The IEA report also says...

As things stand, the world is not set for a decisive downward turn in emissions…


click the image to make it readable
"Para a Causa do Povo a Luta Continua!"
"And that's all I'm going to say about that". Forrest Gump
"Damn, I wanted to see what happened next" (Epitaph)

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3942 on: October 15, 2020, 11:18:28 PM »
The IEA report also says...

As things stand, the world is not set for a decisive downward turn in emissions…


click the image to make it readable

It looks like the report was prepared before China announced (in late September) their commitment to peak emissions by 2030 on their way to being carbon neutral by 2060.  And in early November we'll find out if the USA will be issuing a new stated policy in January 2021 that would result in emissions having already peaked on their way to being carbon neutral by 2050, with a 50% cut in emissions by 2030.

So the "Stated Policies" line in that graph should be much lower due to China's announcement and could be fairly close to the Sustainable Development line in January 2021.

oren

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Re: Oil and Gas Issues
« Reply #3943 on: October 15, 2020, 11:36:20 PM »
Quote
In a STEPS scenario, renewables will meet 80% of the growth in global electricity over the next decade.
While this is good news, it's far from good enough. Renewables should meet 100% of electricity growth, plus at least 5% of current electricity generation, if we are to achieve decarbonized global electricity within two decades. Instead, non-renewable electricity generation is expected to grow throughout the coming decade.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3944 on: October 19, 2020, 07:45:24 PM »
China's economy is recovering from the Covid-19 shut downs, although at a slower pace than originally projected.  Oil demand hasn't recovered as quickly, mainly because international air travel is still heavily impacted by the Covid travel restrictions.

https://www.spglobal.com/platts/en/market-insights/latest-news/oil/101920-china-q3-gdp-up-49-but-ailing-aviation-manufacturing-sectors-to-cap-fuel-demand

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    19 Oct 2020 | 07:11 UTC Singapore

China Q3 GDP up 4.9% but ailing aviation, manufacturing sectors to cap fuel demand

Highlights

Q3 growth falls short of 5.2%-5.5% expansion forecast

Q4 oil demand still expected to fall 250,000 b/d on year

Cyclical winter demand to support gas consumption

Singapore — China has reported an economic growth of 4.9% in the third quarter, paving the way for a recovery in fuel and commodities demand for Asia's biggest energy consumer, but high oil stockpiles and bleak goods and services exports outlook will likely keep industrial fuel consumption and refinery run rates limited.

The 4.9% growth in Q3, despite slower than the expected 5.2%-5.5%, put China's GDP back to the growth path of 0.7% year on year expansion for the January-September period from the 1.6% contraction in the first half, according to data released by the National Bureau of Statistics, or NBS, on Oct. 19.

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Platts Analytics expects China's oil demand to trend lower year on year by 250,000 b/d in Q4, after two quarters of growth, due partly to a high base last year and as state-back industrial activity growth fades without further stimulus measures.

In addition, China's jet fuel consumption outlook also remains bleak despite the recent sharp recovery in domestic flight operations as international travel remains largely restricted.

Platts Analytics expects China's kerosene/jet fuel demand to remain weak and average 710,000 b/d in Q4, down year on year by 280,000 b/d.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3945 on: October 19, 2020, 07:59:57 PM »
Opponents to transitioning our energy systems to carbon-free sources frequently state that it will cost trillions of dollars to do so.  They often fail to consider that replacing fossil fuel infrastructure at the end of its useful life will also cost trillions of dollars.  Daniel Yergin, an expert who has written several informative books about the oil and gas industry, is now forecasting peak oil demand in 2030 and notes that just to maintain current oil production levels, $4.5 trillion will need to be invested in oil and gas infrastructure in the next five years.

https://www.cnbctv18.com/videos/market/commodities/see-world-oil-demand-peaking-in-2030-says-ihs-markits-daniel-yergin-7223261.htm

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See world oil demand peaking in 2030, says IHS Markit's Daniel Yergin
Updated : October 16, 2020

Daniel Yergin, vice chairman at IHS Markit on Friday said it sees world oil demand peaking in the first half of 2030. He said the change in consumption will not happen overnight, but as incomes rise, people's energy consumption will rise.

According to Yergin, the world needs $4.5 trillion investment in oil and gas in the next five years, "If it is not there, I think we will see different oil prices than we are seeing today."


Rodius

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Re: Oil and Gas Issues
« Reply #3946 on: October 20, 2020, 11:04:09 PM »
SO much irony....

The Epitome Of Stupidity: Oil Companies Chill The Ground In Alaska So They Can Keep Drilling

The Guardian reports that ConocoPhillips and other oil companies sucking oil out of the North Slope in Alaska are facing a new challenge. The area is warming so fast that the permafrost is melting, making it impossible to drive trucks across it and potentially destabilizing oil rigs and other infrastructure.

https://cleantechnica.com/2020/10/20/the-epitome-of-stupidity-oil-companies-chill-the-ground-in-alaska-so-they-can-keep-drilling.

kassy

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Re: Oil and Gas Issues
« Reply #3947 on: October 20, 2020, 11:06:39 PM »
Laugh, cry or smash head into wall. I sit here confused.  :-\
Þetta minnismerki er til vitnis um að við vitum hvað er að gerast og hvað þarf að gera. Aðeins þú veist hvort við gerðum eitthvað.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3948 on: October 21, 2020, 06:27:42 PM »
The attached article discusses short and long term trends for the fossil fuel industries.  It gives a historical perspective of the link between GDP and energy use and shows that the link has been reduced in the past decade (GDP growth requires much less energy growth now).  It then discusses prospects for a short term rebound from the Covid recession and the long term decline of fossil fuels.  It concludes that much of the money invested in fossil fuels today will result in stranded assets, and thus the money shouldn't be spent.

https://oilprice.com/Energy/Crude-Oil/Oil-Poised-To-Rebound-But-What-About-The-Long-Term.html

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Oil Poised To Rebound, But What About The Long Term?
By Leonard Hyman & William Tilles - Oct 20, 2020

Oil bulls predict demand for oil will snap back quickly as global economic conditions improve. The International Energy Agency (IEA), on the other hand, expects a more muted recovery. Not surprisingly you can find any demand forecast needed for either the bull or bear case. And that’s just for short term price and demand forecasts. Longer term demand forecasts have to reckon with negative factors like the rise of electric vehicles including cars, trucks and buses as well as and the nudges of environmental-social-governance (ESG) investing. In addition, the industry faces risks from changes in government policies and competition from even newer technologies. But if we’re looking for positive demand surprises, economic growth in emerging economies in Africa or Asia could accelerate and suddenly require large increments of fossil fuels in the process (Remember China?).

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After World War II energy consumption and economic activity grew in like fashion. Then in the 1970s, thanks to the Energy Crisis and geopolitical tensions in which oil prices rose dramatically, consumers became more conscious of energy usage and thereafter energy consumption lagged economic activity. At the same time the economy moved away from production of goods requiring large energy inputs to production of goods and services that depend on knowledge. (Large accounting and law firms for example use considerably less electricity than a steelmaker with comparable revenues.) The key takeaway here is that around the time of the Great Recession, energy consumption patterns declined once again and consumers use even less energy per unit of GDP (See Figure 1 for a simple approximation.)



Quote
Looking ahead vehicle electrification (transportation consumes more than half of oil production) will no doubt reduce future oil demand. Coal demand will likely hold on for a while as developing countries finish coal fired power stations that they will likely attempt to operate for a decade or two prior to abandonment. But that market could sag as lending institutions bow to increasing public pressure about lending to finance those projects and because renewable resources and relatively inexpensive LNG are making the projects less competitive. Growth in coal consumption started to decelerate around 2013. For that matter, the increase in electric generation has slowed throughout the world (electric generation makes up close to half the market for coal).

Quote
As we see it, asset ambiguity will not pay off. Investors do not like companies with two competing products and strategies—especially when they are diametrically opposed businesses like renewables and fossil fuels. We suspect this tendency may apply to customers and employees as well.

Industry managements may have to decide about the future of fossil fuels sooner than many investors realize. So we would suggest investors look beyond a likely and pleasant near term energy recovery and focus on the long term. The bull case for oil probably hinges on a gradual, multi decade energy transition where demand gradually tapers off but with occasional bursts in demand belying the secular shift.

The bear case is simply that new energy investments made today will be uneconomic long before the end of their economic lives. This makes those new investments possible stranded assets from an accounting perspective that have be written off. This is akin to throwing away money.

Ken Feldman

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Re: Oil and Gas Issues
« Reply #3949 on: October 23, 2020, 09:28:28 PM »
While the oil rig count has slowly increased from it's minimum earlier this year (up another 6 this week), it's not nearly enough to counter the steep decline in production rates from fracked oil wells.  Overall, US oil production is down again this week, to 9.9 million barrels per day.

https://oilprice.com/Energy/Energy-General/US-And-Canadian-Oil-Rig-Count-Continue-To-Rebound.html

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U.S. And Canadian Oil Rig Counts Continue To Rebound
By Julianne Geiger - Oct 23, 2020

Baker Hughes reported on Friday that the number of oil rigs in the United States rose by 6 to 211.

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Total oil and gas rigs in the United States are now down by 564 compared to this time last year.

The EIA’s estimate for oil production in the United States fell sharply for the second week in a row for the week ending October 16—the last week for which there is data, to 9.9 million barrels of oil per day. U.S. oil production is down 3.2 million bpd from its all-time high reached earlier this year.