COVID Market Update
- The IEA has cut its 2020 oil production forecast by 140,000 bpd to 91.9 million bpd, sending the FTSE 100 index down 73 points. The IEA cited the airline industry’s troubles as a key source of weakness in the oil market.
- Saudi Aramco this week reported a $6.6 billion profit for Q2, with H1 profits dipping 50% from H1 2019 when net income reached almost $47 billion. Despite the profit shrinkage, Aramco is keeping its nearly $19 billion dividend payout. Aramco is still planning to boost production capacity to 13 million bpd (at some undisclosed point in the future) despite a planned capex cut to somewhere between $20 and $25 billion next year - down from more than $32 billion last year.
- Scorpio’s offshore support vessel company Hermitage Offshore Services (NYSE:PSV) filed for Chapter 11 protection this week after being unable to reach a deal with its creditors. All of Hermitage Offshore’s 28 subsidiaries have filed. The company has blamed low oil prices as a result of the pandemic.
- Tellurian has scrapped three of its four gas pipelines in its Driftwood LNG Phase 1 project - and that’s if the project moves forward at all. Scrapping three of the four pipelines, combined with finding cheaper sources of feedgas, will allow Tellurian to cut costs by 30%. Tellurian could revisit the viability of the pipelines in the future.
- Capital spending in Alberta’s oil industry is set to fall by a third…