Opening Prices (at the time of this post)
> WTI oil is trading at $40.59/bbl, down $0.34 from Wednesday's close.
> HH gas is trading at $1.874, up $0.05 from Wednesday's close.
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According to the June survey of OPEC production from S&P Platts, overall output from OPEC is down to 22.31 million bpd. Even though some OPEC producers haven’t fully complied with their pledged cuts, Saudi Arabia helped compensate for their faults by slashing its output an extra 910,000 bpd in June. Russia’s production fell to 8.5 million bpd.
OPEC production can be expected to climb in July, because Saudi Arabia plans to lift production to meet its 8.49 million bpd quota.
Oil & Gas Prices - July 9
Oil & Gas Prices - July 9
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - July 9
A judge for the U.S. District Court of the District of Columbia ruled this week that the Dakota Access Pipeline, owned by Energy Transfer (NYSE:ET), must cease operations and be emptied of oil by August 5. This could be a major setback for the beleaguered oil industry in the Bakken region because the pipeline carries 557,000 bpd of oil from North Dakota to Illinois.
However, the case is not over yet, and the ruling is likely not the final word on the subject. In fact, Energy Transfer is continuing to accept nominations for oil for the pipeline, because it believes the judge did not have the authority to order the company to halt operations.
The company plans to appeal the decision to the Supreme Court, if necessary. Meanwhile, producers are preparing to ship oil via rail car if the pipeline shuts down. The logistics necessary to shift to rail transportation may prevent a seamless transition and oil production is likely to slow if the pipeline shutdown goes through.
However, the case is not over yet, and the ruling is likely not the final word on the subject. In fact, Energy Transfer is continuing to accept nominations for oil for the pipeline, because it believes the judge did not have the authority to order the company to halt operations.
The company plans to appeal the decision to the Supreme Court, if necessary. Meanwhile, producers are preparing to ship oil via rail car if the pipeline shuts down. The logistics necessary to shift to rail transportation may prevent a seamless transition and oil production is likely to slow if the pipeline shutdown goes through.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - July 9
The OPEC+ production cuts have been in effect since May 1. Current compliance is at impressive levels — bolstered by better-than-100%
compliance by Saudi - though as demand further recovers and the COVID "shock" moves further into the rear view, the group's cohesion will
inevitably dissipate. We anticipate that the group's core Gulf members will begin to ramp up production starting in 4Q20, adding about 750,000
bpd per quarter until reaching pre-crisis levels at the beginning of 2022. Officially, the agreement runs through April 2022, but we doubt it will take
that long for production to ramp back up. And, as a practical matter, the only countries that truly matter in this regard - i.e., the only ones that
have actually cut supply as part of the agreement - are Saudi, UAE, and Kuwait. - Raymond James
compliance by Saudi - though as demand further recovers and the COVID "shock" moves further into the rear view, the group's cohesion will
inevitably dissipate. We anticipate that the group's core Gulf members will begin to ramp up production starting in 4Q20, adding about 750,000
bpd per quarter until reaching pre-crisis levels at the beginning of 2022. Officially, the agreement runs through April 2022, but we doubt it will take
that long for production to ramp back up. And, as a practical matter, the only countries that truly matter in this regard - i.e., the only ones that
have actually cut supply as part of the agreement - are Saudi, UAE, and Kuwait. - Raymond James
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - July 9
Why did the oil price drop sharply this morning? FEAR of a shutdown.
The "experts" are telling us another major shutdown is needed because a lot more testing is coming up with a lot more cases of COVID-19 despite the fact that 99% of active cases are listed as "mild". See for yourself here: https://www.worldometers.info/coronavirus/
Oil Slumps 3% on Fears of There Will Be US “Lockdown 2”
https://www.investing.com/news/commodit ... -2-2225049
If you subtract deaths in people outside the work force (over 65), the actual death rate for those under 65 is less than 0.5% of those who test positive. For children under 15 (grade school) the COVID-19 global death rate is 4X less than from death caused by the seasonal flu each year. In Texas there have been zero COVID-19 confirmed deaths for people under 20 and only four confirmed for those 20-29.
The "experts" are telling us another major shutdown is needed because a lot more testing is coming up with a lot more cases of COVID-19 despite the fact that 99% of active cases are listed as "mild". See for yourself here: https://www.worldometers.info/coronavirus/
Oil Slumps 3% on Fears of There Will Be US “Lockdown 2”
https://www.investing.com/news/commodit ... -2-2225049
If you subtract deaths in people outside the work force (over 65), the actual death rate for those under 65 is less than 0.5% of those who test positive. For children under 15 (grade school) the COVID-19 global death rate is 4X less than from death caused by the seasonal flu each year. In Texas there have been zero COVID-19 confirmed deaths for people under 20 and only four confirmed for those 20-29.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group