December 17, 2017

Saudi Arabia will need deep pockets if it is to win its oil war with US | Larry Elliott | World news | The Guardian

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News this week that the Saudi government is to raise more than $27bn from bond sales is a sign that the strain of getting involved in a spending battle with the world’s biggest economy is taking its toll. Saudi Arabia is an expensive country to run for the House of Saud. Fearful of Iran, it has imported the latest military kit to show that it is the Middle East’s regional superpower. Higher defence spending has also been needed to fund action in Yemen and to counter the threat from Islamic State. In addition, Saudi Arabia has an unemployment problem that it fears…

Saudi Arabia may go broke before the US oil industry buckles – Telegraph

If the oil futures market is correct, Saudi Arabia will start running into trouble within two years. It will be in existential crisis by the end of the decade. The contract price of US crude oil for delivery in December 2020 is currently $62.05, implying a drastic change in the economic landscape for the Middle East and the petro-rentier states. The Saudis took a huge gamble last November when they stopped supporting prices and opted instead to flood the market and drive out rivals, boosting their own output to 10.6m barrels a day (b/d) into the teeth of the downturn….

EPA ruling may be a ‘big plus’ for natural gas – MarketWatch

The U.S. Supreme Court ruling against the Environmental Protection Agency’s regulations on power-plant emissions is a “big plus” for natural gas, an analyst said Monday. The Supreme Court ruled that the EPA needs to consider costs when regulating pollution caused by power plants, which include coal-fired plants. The court ruling keeps the EPA from imposing new regulations to reduce the amount of mercury and other air toxins. “The ruling also will be a negative for solar and wind which may be a positive for natural gas …. Those proposed solar and wind facilities may now be natural gas,” said Richard Gechter, Jr., principal and…

The U.S. Is Now the World’s Top Oil Producer

It’s a headline that’s as attention-grabbing as it gets, and the proclamation itself is something many people probably never thought they’d see: America is the world’s largest oil producer. Though many analysts thought we were a few years off from overtaking countries like Russia and Saudi Arabia in terms of production, news outlets the world over pounced on data produced by BP that says the U.S. made the jump sometime during 2014. As a result, we’ve seen oil prices drop with wide-ranging effects, and a sense of pride and accomplishment from political and business leaders is palpable. “We are truly witnessing a changing of…

U.S. Ousts Russia as Top World Oil, Gas Producer in BP Data – Bloomberg Business

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The U.S. has taken Russia’s crown as the biggest oil and natural-gas producer in a demonstration of the seismic shifts in the world energy landscape emanating from America’s shale fields. U.S. oil production rose to a record last year, gaining 1.6 million barrels a day, according to BP Plc’s Statistical Review of World Energy released on Wednesday. Gas output also climbed, putting America ahead of Russia as a producer of the hydrocarbons combined. The data showing the U.S.’s emergence as the top driller confirms a trend that’s helped the world’s largest economy reduce imports, caused a slump in global energy…

The Amazing Rise in U.S. Proven Natural Gas Reserves and Use – Forbes

U.S. proven natural gas reserves continue to soar to record highs. We now have some 360 Tcf of proven gas in the ground, recoverable under current market conditions, experiencing increases of 5-8% per year. Driven by the Marcellus shale play in the Appalachian Basin, Pennsylvania and West Virginia have registered the largest gains, with both state reserve totals more than quadrupling since 2010. In fact, Pennsylvania and West Virginia have accounted for about 60% of new U.S. gas reserves since 2008, although mighty Texas continues to plug along, upping its reserves by 20% since then. These increases in U.S. gas reserves are…

US Oil Production is Higher Than We Thought – MoneyBeat – WSJ

When oil traders began obsessing earlier this year about U.S. crude production, analysts were quick to sound alarms. Market participants have been eager to discern whether the country’s oil output has peaked. Last year’s swoon in oil prices prompted companies to sharply cut spending, and new drilling for oil in the U.S. has plummeted. Traders began parsing U.S. Energy Information Administration reports for clues, and previously little-noticed week-to-week changes in production began moving the market. But analysts warned the market shouldn’t rely too heavily on the weekly figures, which are largely based on a forecasting model. Wait for the monthly reports,…

Latest US proposal for ethanol could have political fallout – Yahoo News UK

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WASHINGTON (AP) — The Obama administration’s latest plan on ethanol, the corn-based renewable fuel, probably will not have a major effect on pump prices, but could have political reverberations in Iowa and other farm states in the 2016 presidential campaign. Under the proposed rule announced Friday, the amount of ethanol in the gasoline supply would increase in coming years, just not as much as set out under federal law. That approach drew criticism from ethanol and farm groups that have pushed to keep high volumes of ethanol in gasoline. Democratic presidential candidate Hillary Rodham Clinton has called for a robust…