Februay 18 Blog

[dan_s]

I went to hear the World Oil magazine 2013 forecast today at the Pioneer Oil Producers luncheon. Over 20 EPG members attended. Here are some of my notes.

World Oil's Forecasts:
> WTI should average $87.80/bbl in 2013 (speaker thinks they may increase the forecast)
> Brent should average $103.50/bbl (way too low IMHO)
> Gap between Brent and WTI will narrow to under $10/bbl by end of 2014 (WTI will go up)

U.S. Crude oil production (this is black oil w/o ngls)
> 2012: 6.4 MMBOPD
> 2013: 7.3 MMBOPD
Note: It is very important when you see "oil production" forecasts that you find out if they are talking about crude or total liquids.

U.S. Natural gas production in 2013 will be about flat to 2012 at ~70 bcfpd

Texas has the two "hottest" oil plays in the U.S. with the Eagle Ford (5,000 new wells expected in 2013) and the Permian Basin (9,000 new wells in 2013).

They are expecting a big increase in Marcellus Shale drilling this year (rather surprising to me).

Alaska oil production dropping like a rock and state treasury could spend their entire surplus by early 2014.

California Shales could be the next "Big Thing". I agree, since the governor now realizes that this may be the only hope for the state's fiscal cliff issues.