US demand for refined petroleum products has quit dropping and started to rise a bit.
Posted on 11/02/2014 7:33:26 AM PST by blam
Anna Driver
November 2, 2014
HOUSTON - Top U.S. oil producers, which already were reining in spending before crude prices started to slip in June, are now looking to trim more fat from their budgets while reminding investors they must spend to grow.
Exxon Mobil Corp on Friday it would keep its current spending plan intact, though it is about 15 percent less than 2013. ConocoPhillips said it will spend less money next year, and Chevron Corp said it is looking for budget "flexibility."
Crude oil prices have slumped 25 percent since June as global supplies grow and demand weakens.
Exxon, which sets budgets using a long-term horizon, still expects to spend a little bit less than $37 billion a year from 2015 to 2017, an executive told investors on Friday on a conference call.
"We always are mindful of what's happening in the near future but I keep on pulling back that we are a long-term investor," said Jeff Woodbury, Exxon's head of investor relations.
Exxon tests projects "across the full range of economic parameters including price" to ensure favorable returns, he said.
The Irving, Texas company saw capital spending peak at $42.5 billion last year when it was advancing projects to deliver future production growth. Exxon has spent $28 billion so far this year, down 14 percent versus the first nine months of 2013.
ConocoPhillips, the largest independent oil and gas company, said on Thursday it plans to spend less than $16 billion next year, below the $16.7 billion it expects to spend in 2014.
"(Capital spending) is going to be lower because of the commodity price environment," Jeff Sheets, ConocoPhillip's chief financial officer said in an interview with Reuters. "We have the flexibility in our capital program to reduce it without giving up any opportunities."
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(Excerpt) Read more at businessinsider.com ...
It all comes down to the economics, sales prices verses investment to get it. Supply in the US has increased markedly with the advent of fracking and being able to sidetrack wells. Demand has been dropping, the recession has taken a bite, MPG standards for cars are reaching outragious levels and under Odope yet are expected to go much higher shortly again. Shale production is economically feasible above about 60 per barrel. So, all in all things will reach equilibrium at some point which will cause another ramp up in exploration. Some of that exploration will come on Wall Street where it may become cheaper to find oil then in the field as asset laden companies become aquisition targets...I can think of a few.
US demand for refined petroleum products has quit dropping and started to rise a bit.
Took a lot of small independents out of the picture and caused a lot of cutbacks in oilfield service companies.
Many smaller companies didn't make it.
Does that exclude exports. I wonder as the US has been exporting refined products quite a bit.
That is only the consumption inside the US. Exports are separate.
Click graph for source.
Products Supplied
http://www.eia.gov/dnav/pet/TblDefs/pet_cons_psup_tbldef2.asp
Approximately represents consumption of petroleum products because it measures the disappearance of these products from primary sources, i.e., refineries, natural gas processing plants, blending plants, pipelines, and bulk terminals.
In general, product supplied of each product in any given period is computed as follows: field production, plus renewable fuels and oxygenate plant net production, plus refinery and blender net production, plus imports, plus net receipts, plus adjustments, minus stock change, minus refinery and blender net inputs, minus exports.
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