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re: US oil production has increased 300,000 barrels per day in Nov alone
Posted on 11/28/19 at 7:25 am to cwill
Posted on 11/28/19 at 7:25 am to cwill
quote:
And E&P and midstream equities are cratering...these are some of the darkest days in the industry as shitco management teams destroyed billions of capital drilling uneconomic wells. Bankruptcies and massive layoffs are going to be the O&G story for 2020
Company I’m with is investing heavily in midstream. That is not their outlook at all.
Posted on 11/28/19 at 7:30 am to cwill
I've laid low on the oil production posts while all the cornucopians say the U.S. can drill itself into independence -- I know you don't share my doomer sentiments, but here is a nice summary of the uptick the U.S. enjoyed.
LINK /
quote:
As the great Wendell Berry pointed out years ago, this is about the nation’s home economics: energy and resources in, production out, surplus wealth saved. America had a brush with reality in 2008 when all the distortions of our home economics came together and whapped the country between the eyes with a two-by-four. Our energy-in was faltering. US oil production had fallen to a new low of under 4 million barrels a day and we were importing around 15 million. We papered over the problem with borrowed money in ever-larger amounts. This dynamic prompted ever riskier work-arounds on Wall Street, especially “innovations” in securitized debt, which invited criminal shenanigans. It blew up badly. Wealth vaporized. Industries collapsed. Homes and jobs were lost. Lives ruined.
The fairy-tale narrative since then is that technology rode to the rescue. The shale oil miracle “solved” the energy-in problem. Sure seems like it. But lots of things aren’t what they seem to be. Shale oil was a neat stunt. Turns out you can produce a helluva lot of it by paying more to pull it out the ground than you get from selling it. You can goose the process nicely by paying for it with borrowed money. And so it has gone. America now produces a new record of over 12 million barrels a day, and most of the companies doing it can’t make a red cent. And since it is increasingly obvious that they won’t ever pay back the money they borrowed before, they are unlikely to get new loans to continue their profitless operations.
Notice how rapidly shale oil production shot up after 2008. It’s worth a peek at analyst Steve St. Angelo’s latest essay on shale oil company debt (Finance Costs Are Killing the Shale Industry) to understand just how this stunt worked. As blogger Tim Morgan at Surplus Energy Economics points out, the dis-economics of energy production — and shale oil in particular — are stealthily damaging everyday life: “…the world economy is already suffering from these effects, and these have prompted the adoption of successively riskier forms of financial manipulation in a failed effort to sustain economic ‘normality.’”
That tells you exactly why the stock markets are at record highs now, along with US oil production. What the nation doesn’t get is that the shale oil industry is sure to collapse, and at least as rapidly as it shot up. So, expect the stock markets to collapse with it, along with tremendous collateral damage to all the other instruments that represent “money” — bonds, currencies, and their derivatives. It will make the 2008 episode look like a mere overturned poker table when it happens. In the meantime, many of the activities enabled by the oil industry are wrecking the planet, not just CO2 emissions, but the plastics and chemical industries especially. So, the oil quandary bites at both ends: damned if it quits on us and damned if it keeps going.
LINK /
Posted on 11/28/19 at 7:30 am to JasonL79
quote:
Company I’m with is investing heavily in midstream. That is not their outlook at all.
Good for them but check out the performance of midstream equities over the last 2 years.
Posted on 11/28/19 at 7:32 am to Bunk Moreland
quote:
U.S. can drill itself into independence
It can’t and the term is meaningless political babble.
Posted on 11/28/19 at 7:33 am to cave canem
quote:Had zero to do with Obama and everything to do with technological advances in fracking, shale discoveries and advances in harnessing it, advances in harnessing NG, and the fact oil being above $150 a barrel prior to the recession enabled over 10,000 new O&G companies to dig a gazillion new wells before the 2008-09 economic crash. In addition to the barrel price going from $160 to $53 almost overnight for unrelated and uncorrelated reasons, it had an easy as hell path to self-correction.
Not a big fan of the Dems but the most rapid production growth in US history came under Obama, so much so that the US completely unbalanced the global crude market in a good way.
And then for the oil barrel to plummet again in 2014-16 (low of $26!!!) and many of those companies to go out of business, one might suggest this was planned by the Obama administration, maybe in concert with the Saudi’s. I mean it’s not like the guy didn’t try to shut down expansions to the Keystone, Dakota, and Mid-America pipelines, deny access to a ton of Alaskan territories, and shut down a bunch of off-shore drilling sites.
Those ME oil magnates don’t/didn’t donate tens of millions to Obama and Clinton campaigns and foundations for nothing, ya know. This whole industry is gamed for corruption by our elected officials to exploit.
Posted on 11/28/19 at 7:38 am to BeefDawg
quote:
And then for the oil barrel to plummet again in 2014-16 (low of $26!!!) and many of those companies to go out of business, one might suggest this was planned by the Obama administration, maybe in concert with the Saudi’s.
The industry did it to itself. Too much supply and much of uneconomic even at the $100/bbl price. What fueled the wild, uneconomic dev more than price was low interest rates.
Posted on 11/28/19 at 7:44 am to trinidadtiger
(no message)
This post was edited on 12/17/21 at 9:10 pm
Posted on 11/28/19 at 7:44 am to cave canem
quote:
Obama had frick all to do with it but those are facts.
So you acknowledge tying Obama’s name to your original statement was just dumbass frickery. So why do you do it?
Posted on 11/28/19 at 7:45 am to cave canem
quote:
but the most rapid production growth in US history came DESPITE being under Obama regime
FIFY. Obama did everything he could to slow that roll. Thank God for fracking and private leases. Look where all the increase came from and you will see.
Obama being in office was more of a coincidence than anything.
Posted on 11/28/19 at 7:47 am to Bunk Moreland
quote:Nothing but fear-mongering from clown climate change advocates.
Bunk Moreland
The “collapse” or “bubble burst” already happened in 2014-16, and we’re already past it and on a slow and steady domestic upward trajectory.
Posted on 11/28/19 at 7:48 am to Bunk Moreland
quote:
In the meantime, many of the activities enabled by the oil industry are wrecking the planet, not just CO2 emissions, but the plastics and chemical industries especially.
When the author feels the need to throw that one sentence in...I feel like the ghost writer was Warren or Bernie.
Posted on 11/28/19 at 7:49 am to BeefDawg
quote:
The “collapse” or “bubble burst” already happened in 2014-16, and we’re already past it and on a slow and steady domestic upward trajectory.
Prices bounced to 70 but have settled in the 50s, but capital markets are shut and the industry is in the shitter. BKs are coming with a vengeance in 2020.
Posted on 11/28/19 at 7:49 am to BeefDawg
You partisan idiots never include the ones you voted for, lol
quote:
BeefDawg
quote:
Those ME oil magnates don’t/didn’t donate tens of millions to Obama and Clinton campaigns and foundations for nothing, ya know.
This post was edited on 11/28/19 at 7:51 am
Posted on 11/28/19 at 7:50 am to Bunk Moreland
The Bakken & Permian will be producing oil for another 100 years
Posted on 11/28/19 at 7:52 am to BeefDawg
Beef, you're one of my favorite posters on stuff like the spying operation on Trump. I'll say this. I'm not a climate change guy -- too dumb to understand the science. So, I don't like when guys like Kunstler get into that. But, I am still 100% doomer on this world's (and country's energy future). We are not finding Ghawars out there. We are finding shittier and shittier oil that is going to cost more and more to get out of the ground and refine. It's a case of running faster to stay in place. I see the U.S. production increase as kind of one last heroin blast before production craters for good. I simply do not believe we are in a slow and steady phase of increase.
Posted on 11/28/19 at 8:07 am to Bunk Moreland
quote:
Beef, you're one of my favorite posters on stuff like the spying operation on Trump. I'll say this. I'm not a climate change guy -- too dumb to understand the science. So, I don't like when guys like Kunstler get into that. But, I am still 100% doomer on this world's (and country's energy future). We are not finding Ghawars out there. We are finding shittier and shittier oil that is going to cost more and more to get out of the ground and refine. It's a case of running faster to stay in place. I see the U.S. production increase as kind of one last heroin blast before production craters for good. I simply do not believe we are in a slow and steady phase of increase.
The same tech that has led the US boom is going global and will lead to more production elsewhere.
However the stone age did not end due to a lack of stones, nor was king coal dethroned due to a lack of resources, the end of the age of oil is well-nigh upon us.
Posted on 11/28/19 at 8:10 am to Stingray
quote:
No such thing in Trump economy. Watch what happens when the trade deals take hold.
Google oil and gas layoffs.
Posted on 11/28/19 at 8:11 am to Sayre
quote:You're clearly the partisan idiot feeling the need to bring up context that has nothing to do with what’s going on today just so you could try and shite on Republicans.
You partisan idiots never include the ones you voted for, lol
I couldn’t stand Bush after using 9/11 as a bullshite excuse to invade Iraq, and didn’t vote for him his second term. But he’s irrelevant to the current discussion, so GTFO with your retarded shite.
The Clinton I was referring to was Hillary, as she was obviously the one taking in tens of millions from ME countries. And per her campaign rhetoric, it was obvious she was planning to ruin domestic fossil fuel energy production where possible and keep us dependent on the ME teet. But clearly you’re too butthurt to deduce this.
I bet you cry about man-made armageddon climate change and have a raging case of TDS too. Dumbass.
Posted on 11/28/19 at 8:14 am to trinidadtiger
“We’re gonna run outta oil!”
Posted on 11/28/19 at 8:18 am to BeefDawg
Trump has repeatedly called for the Saudis to increase production or not make cuts to support pricing...he wants Saudi supply to suppress prices...that’s great for domestic energy companies, right?!?!
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