Insider Secrets

Insider Secrets

Learn how the PROs are making money from the oil and energy market.

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Energy

  • EIA Data Still Doesn’t Add Up

    As initially pointed out by Peakoilbarrel.com in a recent article, discrepancies between actual data for oil production in Texas vs. what the EIA claims are so stark it’s almost scary. How this can be overlooked by the mainstream media as well as by most of the broker community is even more alarming. Further, how the U.S. oil industry fails to catch it and question it given that their livelihood is tied to it is even scarier.Using the data plotted on the Texas RRC website, combined with the knowledge that Bakken production has been flat to declining, makes us wonder how…

  • Oil Faces Steep Downside Risk From China’s Stock Market

    Oil markets face a lot of downside risk – high crude oil inventories in both the U.S. and Europe, resilient production from U.S. shale, increasing output from OPEC, a nuclear deal with Iran, the turmoil in Greece – but one has not yet percolated through the markets just yet: the possibility of economic cracks in China, the largest oil importer in the world.China’s economic growth has been cooling in recent years, with 2014 marking its slowest GDP growth rate in a quarter century. But that doesn’t signal anything is amiss. It is entirely unsurprising that the world’s second largest economy…

  • Mexico Moving Forward With Major Natural Gas Pipeline

    On June 22, Mexico’s Federal Electricity Commission (CFE) announced it would tender a new round of 24 energy infrastructure projects totaling $10 billion, including a $3 billion underwater pipeline bringing U.S. natural gas from Texas to Tuxpan, Veracruz. Amidst a grand national “gasification” strategy that has promoted Mexican imports of U.S. natural gas, this may be one of the most ambitious projects yet. Of course there are concerns around potential risks associated with the project – whether there is the local capacity to carry it out, and whether it’s really necessary – all of which must be resolved if the…

  • Top Shale Takeover Targets

    In spite of all the talk about the fall in oil prices leading to greater mergers and acquisitions activity, so far the sector has been relatively quiet in 2015. When word broke earlier this year that Whiting Petroleum was possibly up for sale, many market commentators thought that would herald the start of more intense M&A activity. Half way through the year, that has not been the case. Instead, there seems to be a disconnect between buyers and sellers on price. That disconnect can be partially alleviated with stock-for-stock deals, but for now, many parties seem content to wait for…

  • Midweek Sector Update: Bearish Signs For Oil From Europe

    Brazil’s Petrobras has slashed its capital spending program for the next five years, cutting it by 37 percent in an effort to stop the hemorrhaging of its balance sheet. Low oil prices and the kickback scandal have overwhelmed the company, already the world’s most indebted oil firm. Lower spending could help shore up the balance sheet, putting off expensive projects as it seeks to right the ship. However, foregoing important investment on Petrobras’ presalt oil, off the coast of Rio de Janeiro, will lead to lower production levels down the line. The Brazilian company predicts that it will only produce…

  • How U.S. Shale Is Refusing To Bow To Saudi Pressure

    In 2014 the Saudis could no longer accept the loss of crude oil market share as the North American production levels shot up sharply over a three-year period.(Click to enlarge)Source: Yardeni Research The Saudi response was quite rational. Rather than cutting production to support crude oil prices, the Saudis announced that output will remain the same. In private they were planning to actually increase production in order to meet rising domestic demand as well as to regain market share. The idea was to put a squeeze on the high-cost North American oil firms, halting production growth and ultimately getting prices…

  • Is Iran A Worthy Gamble For The Oil Majors?

    The deadline for the negotiations over Iran’s nuclear program is finally here, raising the possibility that the OPEC member could finally see sanctions removed from its economy. That could open up new opportunities for it to not only sell the large volume of oil that it has sitting in storage, and boost output at some of its existing oil fields, but Iran could also bring in international oil companies to develop some new fields. Iran has somewhere around 158 billion barrels of oil reserves, the fourth largest in the world. It also sitting on the second largest reserves of natural…

  • Current Oil Price Slump Far From Over

    The oil price collapse of 2014-2015 began one year ago this month (Figure 1). The world crossed a boundary in which prices are not only lower now but will probably remain lower for some time. It represents a phase change like when water turns into ice: the composition is the same as before but the physical state and governing laws are different.*Figure 1. Daily crude oil prices, June 2014-June 2015. Source: EIA. (Click image to enlarge) For oil prices, the phase change was caused mostly by the growth of a new source of supply from unconventional, expensive oil. Expensive oil…

  • Brazil A Victim Of Oil Prices And Its Own Hype

    Low oil prices and a massive scandal in Brazil threaten the country’s ability to fulfill its expected role as a source of future oil growth. Brazil produced an estimated 2.9 million barrels of oil per day in 2014. The 2007 discoveries of vast reserves of oil located beneath a thick layer of salt prompted optimism that the country could lift its oil output significantly. Just two years ago, Brazil confidently predicted that it would be able to double its oil production on the back of its pre-salt fields, allowing the country to produce 5 million barrels per day (mb/d) by…

  • Oil Production Vital Statistics July 2015 – Equilibrium Reached

    During May and June the oil price has stabilized and both WTI and Brent spot prices have converged on $60 / bbl; the US oil rig count is still falling, but slowly; oil production from all regions is stable hence global total liquids production is trending sideways on the back of recent sharp rises. It appears that oil market equilibrium has been reached. Past experience tells us that this is unlikely to last long. The IEA have once again revised US production upwards by around 300,000 bpd, backdated to March and this clouds recent movements in the global and US…

Martin tiller