U.S. Oil Production not getting back to 2019 peak this year
Posted: Mon Aug 08, 2022 1:10 pm
or anytime soon.
U.S. oil rig count falls by the most since September, Baker Hughes says. Reuters.
U.S. energy firms this week cut the number of oil rigs by the most since September as production grows incrementally because energy firms are boosting shareholder returns and facing higher operating costs due to inflationary and supply chain pressures. The number of oil rigs, an early indicator of future output, fell seven to 598 in the week to Aug. 5, the first weekly decline in 10 weeks, energy services firm Baker Hughes Co (BKR.O) said in its closely followed report on Friday. Even though the total rig count has climbed for a record 24 months through July, weekly increases have mostly been in the single digits and oil production is only forecast to recover to pre-pandemic record levels next year.
Energy production declined by record amounts in several states in 2020. US Energy Information Administration.
In 2020, energy production in the United States fell by record amounts compared with 2019, mostly as a result of decreased economic activity during the COVID-19 pandemic. Wyoming had the largest drop in total energy production among the states, decreasing by 1,264 trillion British thermal units, mostly due to decreased coal production. Seven states saw their largest annual energy production decline in at least 60 years, as reported in our State Energy Data System. U.S. crude oil production fell by a record 8% in 2020. Production fell in 29 of the 32 states that produce crude oil, in part because of reduced demand for transportation fuels during the pandemic. One notable exception was in New Mexico, where crude oil production increased by 216 trillion Btu (an 11% increase from 2019). New Mexico became the nation’s second-largest crude oil-producing state in 2021.
US oil producers defy calls to open taps and tame war-driven energy prices. Financial Times.
America’s largest oil and gas producers are keeping a lid on supply, defying calls from the Biden administration to lift output even as soaring fuel prices driven by Russia’s war in Ukraine deliver bumper profits. Top shale oil and gas producers including ConocoPhillips, Pioneer Natural Resources and Devon Energy all unveiled a sharp increase in second-quarter profits this month as high crude and natural gas prices fill the industry’s coffers. But executives say they remain under pressure from Wall Street to return the windfall to investors through dividends and share buybacks rather than spending heavily to increase production. That sentiment was echoed by other shale executives in the latest sign that oil companies and their shareholders remain unmoved by politicians’ calls for more oil and gas supply after Russia’s invasion of Ukraine sent fuel prices soaring.
Shale drillers warn of higher costs as they report record profits. Wall Street Journal.
Shale companies are reporting banner profits but are warning that inflation in the oil patch is leading them to increase their spending. Oil prices hovering around $110 a barrel in the second quarter lifted the earnings of some of the largest shale companies. Pioneer Natural Resources Co., Continental Resources Inc., Diamondback Energy Inc., Coterra Energy Inc. and Matador Resources Co. all reported historically high profits in recent days, according to FactSet. A measure of Pioneer’s net income reached about $2.37 billion, more than six times what it reported the same time last year. A measure of Diamondback Energy’s profit was $1.46 billion, up from $328 million last year. At the same time, many shale companies are increasing their budgets to deal with labor shortages and the soaring prices of raw materials and services.
U.S. oil rig count falls by the most since September, Baker Hughes says. Reuters.
U.S. energy firms this week cut the number of oil rigs by the most since September as production grows incrementally because energy firms are boosting shareholder returns and facing higher operating costs due to inflationary and supply chain pressures. The number of oil rigs, an early indicator of future output, fell seven to 598 in the week to Aug. 5, the first weekly decline in 10 weeks, energy services firm Baker Hughes Co (BKR.O) said in its closely followed report on Friday. Even though the total rig count has climbed for a record 24 months through July, weekly increases have mostly been in the single digits and oil production is only forecast to recover to pre-pandemic record levels next year.
Energy production declined by record amounts in several states in 2020. US Energy Information Administration.
In 2020, energy production in the United States fell by record amounts compared with 2019, mostly as a result of decreased economic activity during the COVID-19 pandemic. Wyoming had the largest drop in total energy production among the states, decreasing by 1,264 trillion British thermal units, mostly due to decreased coal production. Seven states saw their largest annual energy production decline in at least 60 years, as reported in our State Energy Data System. U.S. crude oil production fell by a record 8% in 2020. Production fell in 29 of the 32 states that produce crude oil, in part because of reduced demand for transportation fuels during the pandemic. One notable exception was in New Mexico, where crude oil production increased by 216 trillion Btu (an 11% increase from 2019). New Mexico became the nation’s second-largest crude oil-producing state in 2021.
US oil producers defy calls to open taps and tame war-driven energy prices. Financial Times.
America’s largest oil and gas producers are keeping a lid on supply, defying calls from the Biden administration to lift output even as soaring fuel prices driven by Russia’s war in Ukraine deliver bumper profits. Top shale oil and gas producers including ConocoPhillips, Pioneer Natural Resources and Devon Energy all unveiled a sharp increase in second-quarter profits this month as high crude and natural gas prices fill the industry’s coffers. But executives say they remain under pressure from Wall Street to return the windfall to investors through dividends and share buybacks rather than spending heavily to increase production. That sentiment was echoed by other shale executives in the latest sign that oil companies and their shareholders remain unmoved by politicians’ calls for more oil and gas supply after Russia’s invasion of Ukraine sent fuel prices soaring.
Shale drillers warn of higher costs as they report record profits. Wall Street Journal.
Shale companies are reporting banner profits but are warning that inflation in the oil patch is leading them to increase their spending. Oil prices hovering around $110 a barrel in the second quarter lifted the earnings of some of the largest shale companies. Pioneer Natural Resources Co., Continental Resources Inc., Diamondback Energy Inc., Coterra Energy Inc. and Matador Resources Co. all reported historically high profits in recent days, according to FactSet. A measure of Pioneer’s net income reached about $2.37 billion, more than six times what it reported the same time last year. A measure of Diamondback Energy’s profit was $1.46 billion, up from $328 million last year. At the same time, many shale companies are increasing their budgets to deal with labor shortages and the soaring prices of raw materials and services.