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Paucity of Permian Pipelines Poses Potential Price Problem
When you see the price for WTI (West Texas Intermediate) quoted on the evening news, this is the price the oil brings at the transportation hub in Cushing, OK. Producers in the Permian Basin of West Texas and Southeast New Mexico receive this price, less the cost of transportation to get the crude to Cushing.… Read More
LNG Success
During the shale revolution operators were finding gas faster than traditional domestic markets could absorb it. Consequently, some investors saw LNG (Liquefied Natural Gas) exports as a lucrative opportunity. Liquefaction, transportation and regasification facilities are capital intensive and require long lead times for construction. While a number of projects are currently underway in the U.… Read More
Rising Crude Exports
“World Oil” reports that Mike Loya, with crude trading firm Vitol, predicts a significant increase in U. S. crude oil exports. Vitol, which shipped the first cargo of domestic crude after the 40-year old export ban had been lifted, notes that exports already reached 1.21 million barrels of oil per day (bopd) in February. Loya,… Read More
End of Cheap Gas?
The shale revolution resulted in a surplus of natural gas from both gas fields, such as Pennsylvania’s Marcellus shale, and oil fields, such as the Eagle Ford of South Texas. Predictably prices stabilized at modest levels and any temporary shortages were easily addressed by drawing down on inventories, or increasing production. However, this is all… Read More
New Gas Markets
As a result of the shale revolution, the U. S. is blessed with extensive, easily producible, natural gas reserves. This abundance, and proximity to markets, has enabled producers to react quickly to any surges in demand without prices spiking. However, producers, transporters and utilities are trying to further monetize these reserves by developing new markets,… Read More
