Home Forums Hunting & Shooting Hunter's Campfire The Global Oil Market Is Broken, Drowning in Crude Nobody Needs

Do you have some photos of your Pro Line? I have a smaller one and love the boat. A 2510 would be about twice the size of my 221 WA; I need something trailer-able, and the 221 was as big as I could go realistically. Besides, it was priced real right by an owner in the middle of a divorce.

You're a good man and respect your drive and work ethic but many in the military did 3 to5 tours in Afghanistan and Iraq making a fraction of private sector pay, living in shcitty tents not Bechtel housing with servants, great food , and many came home severely injured mentally and physically.

I ve moved 16 times in my career but aint complaining as no one put a gun to my head.

For an oil state like AK, the low prices hit our state govt and discourage development by oil companies.

On the upside, we are no longer dependent on the sand monkeys for our energy needs. The other upside, is this might trigger an exodus from the state by people that have no long-term stake in the place and roll the population back to 600k or less.

I work in the in the Gulf of Mexico on an oil platform. As long as there is oil to produce in our wells we will keep them flowing. The government won't let us stop till the storage is full. The company can't just decide to stop on federal mineral leases. May not get a bonus this year though.
I have been through several downturns it will turn up eventually.

I love cheap gas!

It won’t last. Won’t be long and we’ll be getting raped at the pump again. Such is life.

I remember a time similar to this for oil in 1998. IIRC, the ragheads were trying to put offshore drilling out of business.

Did a little research and found the price traded down to $10ish per barrel back then. Adjusted for inflation that would be about $15 now...so that could potentially be where prices bottom out.

MMS needs that 1/6th royalty to run their business on. GOM production will get preferential treatment.

As discussed before, the big boys will buy existing fields from the leveraged companies and add proven reserves to their portfolios where synergies converge for them.

Don't underestimate their "love" for their neighbor's across the Gulf, Iran. There's some real hatred betwixt those two, and putting it to Iran has to have been part of the motivation. It's not just the US they are targeting. Other vulnerable producers are on the list, too, including the Africans, Venezuelans and Mexicans.

The present state of the oil market is the double whammy effect. Triple whammy, actually.

Price wars for market share, we’ve seen many times along with cheaters within and without OPEC, nothing new there.

Then, along comes the Co virus with the accompanying reduction in demand.

Perfect storm.

Throw in relative energy independence here in the USA and we’ve got what we’ve got.

Kind of where I was going with it. Interesting for sure.

Estimated 7 billion $ project with subsea being in 3 parts. Israel to Cyprus to Greece to Italy. Turkey will most likely be bypassed due to Russia’s influences there.

From Italy to points north and west.

Gas Sales Contracts are in place.

ETA:

Price/Bredero and Saipem are the designated pipe preppers and layers. That’s as of now.

US crude oil price falls below $20

Fall in demand due to virus creates surplus that risks overwhelming storage capacity

David Sheppard and Derek Brower in London 33 MINUTES AGOPrint this page253
US crude oil prices fell below $20 a barrel on Monday, close to their lowest level in 18 years, as traders bet production would have to shut to cope with the collapse in demand from the coronavirus pandemic.

The global oil industry is facing its biggest demand drop in history, with traders and analysts forecasting crude consumption could fall as much as a quarter next month because of widespread lockdowns across the western world as the pandemic spreads.

The US oil benchmark, known as West Texas Intermediate or WTI, hit a low of $19.85 a barrel, losing more than 7 per cent, before picking up to slightly above $20 in the European afternoon. Brent, the international benchmark, lost almost 13 per cent to hit a low of $21.76 a barrel, the lowest since 2002.

Oil prices have fallen more than half in the past month as widespread lockdowns in Europe and North America have slashed oil demand.

While demand has collapsed, the supply of oil has also increased rapidly because of the price war between Saudi Arabia and Russia. Saudi Arabia on Monday said it planned to raise exports even further, as its own domestic consumption drops during the pandemic.

Traders now believe the surplus could approach 25m barrels a day next month, a level that could overwhelm storage capacity worldwide within weeks.

“This is a historic oil price collapse, and it is not done yet as the system physically runs out of places to put all the oil,” said Jason Bordoff, a former energy adviser to the Obama administration and the founder of the Center on Global Energy Policy at Columbia University. “The pain in the shale patch is going to be severe. We will see production shut-ins accelerate.”

Prices are expected to remain under pressure until the market adjusts. Producers will probably be forced to close down output at a scale never seen in the modern oil industry.

WTI briefly traded below $20 a barrel this month as the April contract expired, dropping violently in thin trading. But Monday marks the first time WTI has traded under $20 a barrel since 2002 in normal trading conditions.


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Higher cost producers such as US shale and Canadian tar sands are broadly unprofitable at these price levels, although companies will hope other producers shut off production first.

The sheer speed and depth of the price fall, which has taken crude below the levels to which it plunged both in the last crash in 2014-16 and during the financial crisis, could force a quick reckoning in the industry. US energy producers already made the biggest cut to the number of drilling rigs operating in five years last week, according to data from Baker Hughes.

Analysts have calculated that the US oil industry, which expanded in the last decade to make America the world's top oil producer, could contract as much as 2.5m b/d by the end of 2021, from around 13m b/d of crude output now.

Other expensive production, from the North Sea to marginal fields in Asia, will also come under pressure. The largest oil companies have already announced reductions in capital expenditure or are studying plans to scale down.

Mathios Rigas, chief executive of gas producer Energean, said he expected weaker companies to struggle with many facing bankruptcy. “We're going to see a lot of shutdowns, delays in investment decisions,” said Mr Rigas.

“We are in a different world but there will be survivors”, he said, adding that some companies would see opportunities to invest as others scaled back.

The US has put pressure on Saudi Arabia to scale back its supply surge, but has made little impact. Saudi Arabia launched the price war this month after clashing with Russia over how to respond to the coronavirus-linked hit to demand. But increasingly it is the decline in demand that is worrying the oil industry, with airlines grounded, commuters working from home and factories shutting down.

Bjornar Tonhaugen, head of oil markets at consultancy Rystad Energy, said slumping global oil demand was the key factor in the drop in oil prices, overshadowing the effect of the Saudi-Russia price war. It is outweighing the supply increase “by a factor of 4-5”, he said.

“The oil market supply chains are broken due to the unbelievably large losses,” Mr Tonhaugen added. Refineries are cutting back on processing crude oil into fuel, and oil companies could start shutting down producing wells, he said.

https://news.yahoo.com/saudi-raise-oil-exports-record-levels-price-war-131947879.html

Saudi to raise oil exports to record levels as price war rages

Riyadh (AFP) - Saudi Arabia said on Monday it will raise its oil exports to a record 10.6 million barrels per day starting from May, escalating a price war with Russia.

Oil prices are languishing at 17-year lows as the coronavirus pandemic threatens a global recession that will send demand plummeting.

Saudi Arabia, the world's top oil exporter, which already announced a sharp production increase for April, said it will add additional supplies to the global market, deepening a glut.

"The kingdom plans to raise its petroleum exports by 600,000 bpd from May, so total exports will increase to 10.6 million bpd," said an official at the energy ministry, cited by the state-run SPA agency.

Saudi Arabia had been exporting around 7.0 million bpd under an output reduction agreement among a 24-member producers' alliance known as OPEC+ which included Russia.

Its Gulf neighbour UAE has also pledged to pump at least one million bpd more from next month.

Riyadh said earlier this month it was raising exports to 10 million bpd in April after a production cut agreement among top producers flopped in early March.

OPEC+ failed to reach an agreement on further production cuts to shore up sagging prices as the coronavirus hit the global economy hard.

In an effort to grab market share, Saudi Arabia immediately announced a substantial increase in its production to 12.3 million bpd and exports to 10 million bpd at the beginning of April.

The energy ministry said it will secure the increase from two sources, by using natural gas in the domestic market to free up oil for export and also as domestic consumption drops because of the coronavirus.

The price of oil struck its lowest levels in more than 17 years on Monday, with Brent North Sea crude tumbling to $22.58 per barrel at one point.

There are warnings that oil could sink even further as storage tanks around the world approach full capacity.

Just think of what this is doing to Venezuela.

They’ll just have rely on illegal drug sales.

Now the oil field guys know what us farmers have been feeling for years. We've been giving corn away.

Question is how long will this deflationary pressure last with the trillions of paper they are printing......

Best part is your buddies wonder why you're pissed when they swear they're going all week then bail the night before, too late to find a fill in. Stuck splitting $800 trip 2 ways instead of 4.

happens Brian wanted me to go tomorrow but i got work to finish, and tomorrow is the only half decent day this week weather wise.

normally 6-7 of us go out.

I am so damn happy that after 30+ years in O&G I am pretty well immune to it in retirement.