• 1 day Shell Oil Trading Head Steps Down After 29 Years
  • 1 day Higher Oil Prices Reduce North American Oil Bankruptcies
  • 1 day Statoil To Boost Exploration Drilling Offshore Norway In 2018
  • 2 days $1.6 Billion Canadian-US Hydropower Project Approved
  • 2 days Venezuela Officially In Default
  • 2 days Iran Prepares To Export LNG To Boost Trade Relations
  • 2 days Keystone Pipeline Leaks 5,000 Barrels Into Farmland
  • 2 days Saudi Oil Minister: Markets Will Not Rebalance By March
  • 2 days Obscure Dutch Firm Wins Venezuelan Oil Block As Debt Tensions Mount
  • 2 days Rosneft Announces Completion Of World’s Longest Well
  • 2 days Ecuador Won’t Ask Exemption From OPEC Oil Production Cuts
  • 3 days Norway’s $1 Trillion Wealth Fund Proposes To Ditch Oil Stocks
  • 3 days Ecuador Seeks To Clear Schlumberger Debt By End-November
  • 3 days Santos Admits It Rejected $7.2B Takeover Bid
  • 3 days U.S. Senate Panel Votes To Open Alaskan Refuge To Drilling
  • 3 days Africa’s Richest Woman Fired From Sonangol
  • 3 days Oil And Gas M&A Deal Appetite Highest Since 2013
  • 3 days Russian Hackers Target British Energy Industry
  • 4 days Venezuela Signs $3.15B Debt Restructuring Deal With Russia
  • 4 days DOJ: Protestors Interfering With Pipeline Construction Will Be Prosecuted
  • 4 days Lower Oil Prices Benefit European Refiners
  • 4 days World’s Biggest Private Equity Firm Raises $1 Billion To Invest In Oil
  • 4 days Oil Prices Tank After API Reports Strong Build In Crude Inventories
  • 5 days Iraq Oil Revenue Not Enough For Sustainable Development
  • 5 days Sudan In Talks With Foreign Oil Firms To Boost Crude Production
  • 5 days Shell: Four Oil Platforms Shut In Gulf Of Mexico After Fire
  • 5 days OPEC To Recruit New Members To Fight Market Imbalance
  • 5 days Green Groups Want Norway’s Arctic Oil Drilling Licenses Canceled
  • 5 days Venezuelan Oil Output Drops To Lowest In 28 Years
  • 5 days Shale Production Rises By 80,000 BPD In Latest EIA Forecasts
  • 5 days GE Considers Selling Baker Hughes Assets
  • 5 days Eni To Address Barents Sea Regulatory Breaches By Dec 11
  • 6 days Saudi Aramco To Invest $300 Billion In Upstream Projects
  • 6 days Aramco To List Shares In Hong Kong ‘For Sure’
  • 6 days BP CEO Sees Venezuela As Oil’s Wildcard
  • 6 days Iran Denies Involvement In Bahrain Oil Pipeline Blast
  • 8 days The Oil Rig Drilling 10 Miles Under The Sea
  • 8 days Baghdad Agrees To Ship Kirkuk Oil To Iran
  • 8 days Another Group Joins Niger Delta Avengers’ Ceasefire Boycott
  • 9 days Italy Looks To Phase Out Coal-Fired Electricity By 2025
Alt Text

Don’t Back U.S. Shale To Keep Oil Prices Down

The common assumption that U.S.…

Alt Text

Oil Tycoon Hamm Slams EIA’s Overoptimistic Shale Forecasts

Shale billionaire and chief executive…

Alt Text

The Kurdish Oil Gamble Has Backfired

Kurdistan’s failure to hold the…

Matt Smith

Matt Smith

Taking a voyage across the world of energy with ClipperData’s Director of Commodity Research. Follow on Twitter @ClipperData, @mattvsmith01

More Info

Crude Cracks Below $50 On OPEC Silence

Offshore rig

Oil is trudging tiredly lower into the weekend, exhausted after an onslaught of oil-specific releases and (another) week of ongoing OPEC rhetoric. Hark, here are five things to consider in oil markets today.

1) Earlier in the week, we highlighted how Indian crude imports reached a record last month. The four leading suppliers this year are Saudi, Iran, Iraq and Venezuela. combined, they account for some 60 percent of flows:

(Click to enlarge)

2) According to North Dakota's Department of Mineral Resources, oil production in the state for August dropped 4.7% on the prior month to 981,039 bpd. EIA's projection has it pegged just below this number at 968,000 bpd, while our own proprietary well-by-well production model suggests Bakken production won't drop below 1 million barrels per day until next month.

By the state department's estimate, this is the lowest level since March 2014. Completed wells in the state rose to 59 in August, up from 44 in July. Estimates suggest completions need to rise above 70 wells per month to stabilize production levels.

3) As oil production falls in North Dakota, so follows natural gas - given it is a byproduct of the oil drilling process (aka associated gas). Natural gas production is down 3.5 percent in August to 1.64 Bcf/d, according to the department of Mineral Resources.

This is in contrast to the Permian Basin. EIA's monthly data pegs Permian oil production at just under 2 million bpd, something our own proprietary model wholeheartedly endorses. Hence, as oil production is projected higher next month in the latest drilling productivity report, so follows natural gas (hark, below).

As our friends at RBN Energy have highlighted recently, as gas processing capacity increases in the shale play, and as new discoveries of gas are made (hark, 75 Tcf just discovered at two formations in the play by Apache Corp), production should be buoyed going forward.

4) While Permian may be holding up in terms of production, Eagle Ford continues to drift lower. And just as Texas production and drilling activity have dropped off in the last two years, the Texas economy has also headed south. Related: Can We Trust The Saudis To Stick To The OPEC Deal?

Texas accounts for ~9 percent of total U.S. economic output. Since the end of 2014, 91,000 jobs in the oil & gas and mining-support industries have been lost in the state. Over the same period, 85 oil and gas producers and 87 oilfield services companies have filed for bankruptcy protection in the U.S., with more than half of these in Texas. As unemployment grows and construction has idled, the Texas economy is stagnating:

5) Finally, I was on Anthony Crudele's Futures Radio Show this week, talking about the competitive edge our ClipperData gives to oil traders. A recording can be accessed here.

By Matt Smith

More Top Reads From Oilprice.com:




Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News