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tigerpawl
LSU Fan
Can't get there from here.
Member since Dec 2003
12752 posts

Oil over $60 now
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What say you, petro swamis? Is $60 really the magic number for the depressed O&G Industry? New hiring wave? Will it hold? Are the oil companies dusting off their stacked rigs? Or is this just a head fake?


TrouserTrout
Thibodaux
Member since Nov 2017
637 posts

re: Oil over $60 now
Hopefully the gas price at the pump stays low.


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112
Spirit of Dunson
Columbia Fan
Member since Mar 2007
22843 posts

re: Oil over $60 now
US rig count bottomed out Sept of last year I thought. Been mostly rising since then to more than 900 rigs now. I could be wrong, I'm not so familiar with us rig activity.

ETA - I expect some posters to come in explaining the oil price changes with precise economic, financial, and geopolitical analyses. We are all very good at explaining what were observe, but suck arse at predicting it.
This post was edited on 12/29 at 9:35 am


tigersint
New Orleans Saints Fan
Lafayette
Member since Nov 2012
2897 posts

re: Oil over $60 now
dear baby Jesus please keep going up and make my Engineering Degree useful again.


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100
notiger1997
Metairie
Member since May 2009
39295 posts
 Online 

re: Oil over $60 now
I think you are mostly correct from what little I know about it all.

Pretty sure I read that Shell has the ability to make money offshore with their new assets when oil is above $40.


tigerpawl
LSU Fan
Can't get there from here.
Member since Dec 2003
12752 posts

re: Oil over $60 now
quote:

Pretty sure I read that Shell has the ability to make money offshore with their new assets when oil is above $40.

Ditto for Chevron


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MadtownTiger
LSU Fan
Baton Rouge
Member since Sep 2010
3362 posts

re: Oil over $60 now
Currently, WTI is above $60 mostly due to a relatively flat rig count over the last two or so months. Rig counts started to dip in sept/oct and then bumped up but have been close to the same since for the 2nd half of 2017.

However, Libya & Forties outages have caused Brent to go up, thusly WTI due to the larger spread in price and the fact that the US now exports.

But for future predictions, I see it lowering back down a shade to $55 til April, plant work-overs and maintenance will build some crude inventories...but come next summer, you're going to see crude, gasoline, and distillates stocks cratering thus driving prices probably close to $70-75 by the end of next year, unless the OPEC deal falls apart before the scheduled termination date.

Dallas Fed is giving the idea that they are not going to be funding shale companies into infinity to increase drilling for the foreseeable future. Investors are wanting to see real returns, so I believe any increase in WT shale drilling will be tempered but increase next year.

I see offshore projects, moving on schedule but still slow. Offshore will take a while. After watching ENI with Zohr I don't foresee the future of offshore as 8-10 year megaprojects anymore. Supers and JV's with mid-majors are going to be getting projects on stream much quicker in the next decade into the future to lower their breakeven price.

I really hope the operators are going to be moving personnel this year though, I don't want to be stuck at a service company as a geologist.
This post was edited on 12/29 at 3:45 pm


bayoutiger225
LSU Fan
Member since Nov 2009
277 posts

re: Oil over $60 now
I think that OPEC will discontinue these cuts once they see the market coming back into balance. They may hold the current cuts to bolster each of their economies for a bit but will ramp up production once they see the U.S independents continued drilling efforts in West Texas and other areas.

Should be an interesting 2018. Major pipeline projects are scheduled for construction and more are being proposed.


MadtownTiger
LSU Fan
Baton Rouge
Member since Sep 2010
3362 posts

re: Oil over $60 now
quote:

Should be an interesting 2018. Major pipeline projects are scheduled for construction and more are being proposed.



Ya I know KinderMorgan has a JV with several operators in West Texas to start the Gulf Coast Express Project, that's a 1.92 BCF/D pipeline.

NAmerico also has another 42" pipeline with a very similar track to Corpus Christi that is pegged for 1.85 BCF/D.

Both aren't slated for service til Q3 2019 though, but at that point, you're going to see WT projects rolling pretty quick.


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