Our Blog
Global LNG Outlook
“World Oil” cites recent analysis by consulting group, Wood Mackenzie, which notes that both Asia in general, and China in particular, saw Liquefied Natural Gas (LNG) demand fall by 2% in 2015. Concurrently, capacity increased with significant start-ups in the U. S. and Australia. In fact, production increased to 250 million tonnes, up 4 million… Read More
IEA Forecast
“World Oil” reports that the International Energy Agency (IEA) has reduced its forecast for global energy demand and raised it for supply. Consequently, the agency foresees a growing world-wide surplus and further downward pressure on prices. The major factor driving the supply increase is the removal of sanction on Iranian oil exports. Global demand is… Read More
$20 Oil?
“Rigzone” reports that almost a year ago, Ed Morse, the head of commodities research at Citigroup, said that oil could drop as low as $20. No one really listened, but my how things have changed. With oil recently dropping lower than it has been since 2003, everyone in the industry is familiar with the devastation… Read More
Goldman’s Forecast
“World Oil” reports that investment banker, Goldman Sachs predicts a bull market for oil before year-end. Previously, the bank had been exceptionally bearish, predicting prices as low as $20 per barrel as a possibility in 2016. Goldman says that the $20 scenario is still possible, but only if oil storage capacity runs out. Since this… Read More
DUCs to the Rescue
Approximately one-third of the cost of an oil well is land acquisition and drilling costs. Drilling contracts typically are long term and involve stiff cancellation penalties. Contracts for completion services are of shorter duration and penalties less severe. Consequently, when oil prices started collapsing, shale operators used scarce capital to keep drilling but left the… Read More
