November was a turbulent month for oil prices, one of our top 5 articles highlighted what the sentiment is on that subject. A bit of history made it into the list as well, the first well drilled out of site of land. There are two pieces in this list, one at the top about fracking and what the outlook for the future will be in comparison to output from OPEC and the other is about the everlasting bottleneck, both very important subjects but each tied to together based on supply and demand. Also, a capsizing lift boat near Grande Isle saw rescuers come to the aid of 15 people on board!
Lets get started with Texas pushing production to recording breaking levels!
Texas is About to Create OPEC’s Worst Nightmare
An infestation of dots, thousands of them, represent oil wells in the Permian basin of West Texas and a slice of New Mexico. In less than a decade, U.S. companies have drilled 114,000. Many of them would turn a profit even with crude prices as low as $30 a barrel.
OPEC’s bad dream only deepens next year, when Permian producers expect to iron out distribution snags that will add three pipelines and as much as 2 million barrels of oil a day.
“The Permian will continue to grow and OPEC needs to learn to live with it,’’ said Mike Loya, the top executive in the Americas for Vitol Group, the world’s largest independent oil-trading house. (More Here)#
15 Rescued from the Ram XVIII near Grand Isle
The Coast Guard and good Samaritan vessels have helped rescue 15 people from a lift boat near Grand Isle.
The Coast Guard was called at about 3:16 a.m. Sunday Nov 18th from a lift boat, Ram XVIII, which was taking on water about 23 nautical miles west of Southwest Pass. There were 15 souls on board.
Sector watchstanders issued an urgent marine information broadcast, launched a Coast Guard Station Grand Isle 45-foot Response Boat-Medium boat crew, and launched an MH-65 Dolphin Helicopter air crew. (More Here)
It’s been 71 years since the first well was drilled out of sight of land
November 14, 1947 – First Oil Well drilled Out of Sight of Land: The modern offshore petroleum industry began in the Gulf of Mexico with the first oil well successfully completed out of sight of land. Brown & Root Company built the freestanding platform 10 miles offshore for Kerr-McGee and partners Phillips Petroleum and Stanolind. (More Here)
Halliburton CEO Expects Permian Bottlenecks Gone By End of ’19
Halliburton Co. expects bottlenecks in America’s busiest oil field to be relieved by the end of next year.
A series of catalysts will drive drilling and fracking activity in the Permian Basin of West Texas and New Mexico throughout the next year, Jeff Miller, chief executive officer of the world’s biggest fracker, said during a Bloomberg TV interview. Explorers’ budgets will reload as the calendar flips to next year, and a host of new pipelines will open in the second half of 2019 to create more takeaway capacity. (More Here)
Why Are Oil Prices Dropping Sharply?
Oil prices jumped in September and early October of this year (2018), but have dropped $20 a barrel in the last few weeks. The sharp turnaround is attributed to OPEC’s inability to cut supply, but this is old-fashioned thinking. OPEC’s power is a small fraction of what it was in the 1970s. What’s happening now is wild swings in thinking about the future.
Oil prices have to balance supply and demand, of course, but not necessarily today’s supply and today’s demand. Commodities traders can hold inventories in storage tanks if they think that prices will be higher in a few months, and producers can run wells at lower pumping volumes. (There are limits to flexibility in pumping volumes, though, based on the technical characteristics of each well.) (More Here)
That’s it for this month, we will be back at the end of December for more of your top oil and gas posts, have a great month ahead!
Header photo is licensed under Public Domain. By Vachon, John, 1914-1975, photographer
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