Posted on 10/07/2015 5:45:45 AM PDT by thackney
Oil executives warned on Tuesday of a "dramatic" decline in U.S. production that could pave the way for a future spike in prices if fuel demand increases.
Delegates at the Oil and Money conference in London, an annual gathering of senior industry officials, said world oil prices were now too low to support U.S. shale oil output, the biggest addition to world production over the last decade.
"We are about to see a pretty dramatic decline in U.S. production growth," the former head of oil firm EOG Resources Mark Papa, told the conference.
Papa, now a partner at U.S. energy investment firm Riverstone Holdings LLC, said U.S. oil production would stall this month and begin to decline from early next year. He said the main reason for the decline would be a lack of bank financing for new shale developments.
Official data show that nationwide U.S. output has already begun to decline after reaching a peak of 9.6 million barrels per day (bpd) in April, although production in some big shale patches, including North Dakota, has held steady thus far. The Energy Information Administration forecast on Tuesday that output would reach a low of around 8.6 million bpd next year.
Until this year, U.S. oil output was growing at the fastest rate on record, adding around 1 million bpd of new supply each year thanks to the introduction of new drilling techniques that have released oil and gas from shale formations.
...{OPEC} changed strategy to protect market share against higher-cost producers, rather than cut output to prop up prices as it had done in the past....
The chief executive of Royal Dutch Shell Plc agreed, saying U.S. oil producers would struggle to refinance while prices remained so low, leading to lower output in future.
(Excerpt) Read more at finance.yahoo.com ...
And our gulf oil production off of southern states? Did Obama successfully destroy it all?
“...Oil & Money Conference” ?
Now, there’s a meeting I’d like to attend.
Wonder if they have free samples...
Cracks emerge in U.S. oil boom
http://money.cnn.com/2015/10/06/investing/us-oil-production-declines-gas-prices/index.html?sr=tw100615us-oil-production-declines-gas-prices0903PMStory&linkId=17731377
U.S. oil production decreased by 120,000 barrels per day in September from August, according to a report released by the Energy Information Administration on Tuesday.
It marks the lowest monthly output in the last 12 months. And it was the fourth in the past five months that U.S. production has declined.
That doesn’t mean that it’s time to call this the beginning of the end of the shale oil boom. The U.S.’s oil output still stands at a robust 9 million barrels per day, nearly double the amount of oil pumped in late 2008.
But it was enough to send oil prices rallying nearly 5% on Tuesday to $48.53 a barrel, the highest level in a month.....
Read the first part of this series for a summary of last week’s crude oil price (USO) movements. The WTI-Brent spread has converged significantly since February of this year, when the differential widened to ~$12 per…
While down a little from the peak in 2009, 1.75 MMBPD, the Federal Offshore in the Gulf of Mexico has climbed a little in the past couple years. Now it is 1.58 MMBPD.
This actually shows the flexibility of US oil producers. They can respond to market conditions quicker than anybody else.
All part of a propaganda ploy to try and move the markets.
Supply and demand works. Always has, always will.
Actually, shale production drove prices down, combined with Arabs lowering prices to try and drive shale out, that they all succeeded in killing many of the shale companies.
From the excerpt:
Official data show that nationwide U.S. output has already begun to decline after reaching a peak of 9.6 million barrels per day (bpd) in April, although production in some big shale patches, including North Dakota, has held steady thus far. The Energy Information Administration forecast on Tuesday that output would reach a low of around 8.6 million bpd next year.
All by plan.
The Saudis saw our domestic oil production rise to the point where they couldn’t blackmail us and they didn’t like losing that power.
The economic recession/depression that we’ve been in for 8 years has reduce the world’s overall oil consumption.
Even though there was a massive glut of oil, the Arabs increased oil production to add to the glut?
Why?
Because our domestic oil producers put a lot of money adding new rigs and drilling sites in order to produce more domestic oil.
The maintenance of those rigs was based upon oil being approximately $90/barrel.
The Arabs increased the glut to assist the already plummeting cost of oil. They did so knowing that domestic oil produces would have to shut down their newer rigs.
Back in the 2007/2008 economic plunge, some web sites that focused on the economy had a weekly bank-closure pool. People gave their best estimates of how many banks closed that week (22, 25, 30). The news was always released late of Friday so that it wouldn’t impact the equities markets.
For the past year, those same sites report on how many rigs closed during the weeks. This news was hardly reported at all. Why? Because Obammie the Commie and his leftist agent provacateurs who hate America and especially hate the oil industry, didn’t want the Americans to know that we were being dragged back into dependency on M.E. oil. So the state-run media kept it even more hush-hush than the bank closures.
Now that a large number of US oil rigs have been shut down (and will not be shut down because the cost to restart a closed rig is prohibitive), the Arabs will cut back on production to drive the cost of oil back above the $90/barrel range.
Once they’ve reached that, they’ll resume their previous tyrannical control over oil production.
So why did Obammie the Commie and Hilary! supply arms to the Syrian rebels (AKA Al Qaeda/ISIS) at the risk of being caught supply arms to people we are at war with and the risk of being brought up on charges of high treason? Because Putin and Assad pose a threat to the demand for oil supplied by Saudi Arabia. Not that I’m a fan of Putin’s or think that he is doing anything other than trying to resurrect the USSR, but he is fighting the bad guys this time (if only for his own gain).
So, after all that the Arabs did to our own oil production. WE are now helping THEM to destroy alternative means of supplying oil and other natural resources.
In a sense, we are tying the noose that Obama and the Arabs will be slipping over our heads.
But who cares? What’s on TV tonight? Are there any cute kitten videos going viral today?
Meanwhile, the feds are auctioning offshore windmill leases next month for New Jersey.
The new world order or globalists what ever you call them are in full greed mode to jack up prices on everything they can and extract as much as they can before they destroy the world economy and raid as many assets as they can. Russia was trying to raise oil prices also.
Hey, LS. Exactly. See my Post #12.
” (and will not be shut down because the cost to restart a closed rig is prohibitive)”
Should be:
” (and will not be restart because the cost to restart a closed rig is prohibitive)”
The price varies a lot depending on the field. Break even cost in North Dakota's Bakken by county average are as low as $24~28 in Dunn, McLean, McKenzie and Billings. They go as high as $85 in Bottineau, Bowman, Renville and Slope.
The dramatic decline statement in the headline is indeed for GROWTH, which was my point. Your quotation is from Reuters, not the executive, and is not a dramatic decline in anything. Of course, longer term, the drop in expansion will lead to lower production but, in the longer term, things change and the price will probably have risen enough to allow expansion of development/production to resume.
4-Week Avg U.S. Field Production of Crude Oil
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRFPUS2&f=4
see post #18
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