Energy / Oil Prices

• Global Energy Advisory – 18th July 2014

  Pipeline UpdatesA new pipeline is being proposed from North Dakota’s Bakken oil fields through 17 Iowa counties, ending in Illinois. The proposal for the 1,100-mile underground crude pipeline comes from Texas Energy Transfer Partners, which faces plenty of regulatory hurdles across states. The existing plan is to have the pipeline operational by the end of 2016. The “Bakken Pipeline”—as it is already being named—would have the capacity to transfer 320,000 barrels of crude oil per day. Canada’s Enbridge is starting talks with the authorities in Alaska for the construction of a proposed $8 billion natural gas pipeline that could become…

• Gas Prices Soar, But Have Probably Peaked For Now

  As Americans head into their July 4 holiday weekend, gasoline prices are at their highest levels for this time of year since 2008. The surge in prices is a direct result of recent turmoil in Iraq. The good news is that prices may have peaked for now, as tensions have eased. Barring any new unforeseen geopolitical flashpoints, oil prices could have reached a temporary peak, and prices could come down in the weeks ahead. There are multiple reasons for the improved outlook. First, the unrest in Iraq has leveled out for now, with ISIS militants having been stopped short of…

• Oil Prices Drop, But Probably Not For Long

  The price for a barrel of oil fell on word that more production was coming from key OPEC members, but a report from the International Energy Agency (IEA) says the drop may not last because Middle East oil producers are facing a shortfall in investments.A Bloomberg survey of oil companies, producers and analysts show production from members of OPEC rose in May by 75,000 barrels per day (bpd), to 29.98 million. Production levels were boosted by a 70,000 bpd output from Saudi Arabia, its first increase this year. Even more oil is expected this week from Libya, which has struggled…

• Why You Have to be Long the Domestic E+P’s.

  The big head fake in energy, the one that has somewhat confused me has been how the fantastic quarterly results from the independent E+P’s has affected the domestic price of crude oil.  Or, in fact, how it has not affected it.  With massive production growth going again on record in the numbers of companies like EOG Resources (EOG) and Cimarex Energy (XEC) and dozens of others, we’ve seen a glut of crude oil pour into the Mid-continent and literally search for a place to stay.  While I’ve maintained that even a large influx of new crude wouldn’t have enough power…

• Instability In Libya Continues To Be A Drag On Oil Prices

  The price for the U.S. crude oil benchmark has moved closer to $102 per barrel in trading in part because of renewed concerns over Libya, once one of North Africa's top exporters.  On concerns Libya has not yet broken rebels’ grip on oil export terminals, West Texas Intermediate was trading at $101.40 per barrel, while the price for Brent moved at $109.10.Though U.S. crude oil levels may provide some relief to market worries, the protracted stalemate over Libyan crude, coupled with continued unrest in Ukraine, could push oil prices higher through this summer.In early April, the government in Tripoli brokered…

• U.S. Oil Export Ban Unlikely To Be Scrapped Soon

  Whether or not the U.S. Congress decides to lift the ban on crude exports will largely depend on the trajectory of crude oil prices. Oil prices have been elevated for several years, with West Texas Intermediate (WTI) fluctuating a bit above and below the $100 per barrel mark, and Brent prices going for a few dollars more. These prices give Congress pause, with many members worried that allowing oil exports to move forward would lead to even higher prices, pressing the limits of what the American consumer would be willing to tolerate.  Source: EIAThe crude export ban has been in…

• North American Oil Glut to Keep Prices Low, IMF says

  The International Monetary Fund said global crude oil prices have been relatively lower because of the growth in oil supply from North America. With U.S. oil production on pace to eclipse 9 million barrels per day near term, the trend should continue through next year. Nearly all of the growth in global oil production is coming from the United States and Canada. Combined, North American production growth is around 1.2 million barrels per day from U.S. shale oil and Canadian oil sands. IMF said this growth was spilling over to the global marketplace "Crude oil prices have edged lower, mainly as a…

• The Correct Price for Crude Oil

  With the flattish nature of its action over the past several months, oil seems to have reached a tipping point on price.  It’s almost as if the charts are saying that oil either must break up or break down, if long-term trendlines are going to be respected.Barrons took the opportunity to plump for a downside break last weekend, a prediction I have vigorously argued against in both print media and on-air.  But one follower of mine made a very astute observation, pointing out to me that futures markets for crude oil ten years out are ‘predicting’ oil prices almost $20…

• How the Situation in Crimea Could Cause Oil Prices to Fall

  Moscow’s aggression in Crimea has markets in a panic and bulls predicting continued increases in the price of oil should tensions endure. Nonetheless, there is a chance that Russia’s Ukrainian incursion could result in the exact opposite effect—a decline in oil prices. There are two different ways the Crimean crisis could result in decreased prices: a positive supply shock from the American strategic petroleum reserve (SPR) and a negative demand shock from financially crippled emerging markets. On the supply side, the West is searching for a way to oppose Russian aggression but must tread a fine line between effective resistance…

• Russia’s Eastern War: Part Two?

  The crisis in the Crimea has already raised the price of Russian oil by $2 a barrel, as of Monday creating havoc on some energy markets. And this is only the beginning of what could turn onto a long and complicated crisis pitting the former Cold War foes into a new hot conflict.  Oh yes, and the Russian rouble is the losing value to the US dollar.The uncertainty prevailing in Ukraine and subsequently the uncertainty in the Crimea, a strategic peninsula situated at the southern tip of the country, could send oil prices soaring upwards some more if the current…