4/30/2023 0 Comments Idle oil tycoon saudi fields timetechnology has permitted shale oil to keep flowing even as some smaller companies are on the brink of failure.Īnalysts say U.S. However, the arrival of oil majors into the shale fields with their higher tolerance for price turbulence and the improvements in U.S. industry has managed to continue near-record production, and unlike other producing nations, output is dictated by economics at individual companies rather than government control. "Having an OPEC plus agreement, we would still have a huge demand problem, but we'd no longer be putting water in the bath tub." They were asked to make ever-growing numbers of cuts, while the U.S. "It takes time to idle rigs, and things like that, but this speaks to what the Russians said was unsustainable. The world is seeing much less need for oil, as governments in Europe, India and elsewhere shutdown activity, even as China's demand recovers. in the past week also continued to send a large amount of oil onto the world market, with exports of 3.2 million barrels a day. industry CEOs at the White House Friday to discuss ways the government could help the industry. President Donald Trump said Tuesday that he discussed the oil market with Russian President Vladimir Putin, and he is considering a three-way discussion that would include Saudi Arabia Crown Prince Mohammed bin Salman. Trump also has a scheduled meeting with seven U.S. Despite the drop in rig count and the demand decline, the barrels keep coming," Kilduff said. "At 13 million, the band is still together and keeps playing on. "We have seen the problem in the oil market, and it is us." "This is why Russia is so mad at us," said John Kilduff, partner with Again Capital. In the past month, Brent prices fell by 54%, and some analysts say they will fall more as the world shuts off oil demand and producers continue to pump large volumes of oil. production has been at the crux of the global price war, launched by Russia and Saudi Arabia early last month when Russia broke off its agreement with OPEC to limit production, and Saudi Arabia vowed to pump as much oil as it could to flood the world market. Such an effort would be widely debated and could be seen as unsavory in Washington as some officials worry about antitrust and other considerations of regulating the U.S. OPEC has invited the commission to its June meeting. The Texas Railroad Commission was asked by Pioneer Natural Resources and Parsley Energy to consider curtailing crude output in Texas, as the industry deals with collapsing prices and the drop in demand. industry could be required to curb production to stave off more damage in the sector. It also has raised the question of whether the U.S. In response to the falloff in gasoline and jet fuel demand, the refining industry has cut output by an estimated 20% and could cut back much deeper. Whiting Petroleum this week became the first high-profile shale bankruptcy of the latest downturn. West Texas Intermediate was down 1.3% Wednesday, at just over $20 per barrel. gasoline inventories rose by 7.5 million barrels last week. also added another 13.8 million barrels of oil to inventories, a record amount, which only exacerbates the global struggle with a lack of storage space. drivers remain off the road through at least the end of April to fight the spread of coronavirus. gasoline demand could ultimately fall by 6.2 million barrels a day as more states require citizens to shelter in place and many U.S. That is unprecedented," said Helima Croft, head of global commodities strategy at RBC. "Right now, we have a supply problem and a demand problem. gasoline demand translates to the equivalent of 10% of global oil demand. This time last year, drivers were using about 9.2 million barrels a day of gasoline. At the same time, demand for gasoline fell to 6.7 million barrels a day from 8.8 million the week earlier.
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