Jimmy, Just hang on for the ride. It may get worse before it gets better. Saudi’s can produce for $10 per barrel and they are going to have to force a stock market exchange to except their IPO offering, because Aramco has no transparency. Meaning, the books are probably ‘cooked’.
Martha, check interesting story in Drudge this morning titled “OPEC Panic”.
American Association of Petroleum Geologists January 2016 http://www.aapg.org/publications/news/explorer/emphasis/articleid/2…
Excellent article Martha! Thanks!
Was just talking with the boys at Chevron and they think oil will not go above $40 this year and are preparing for another lay off. They don’t think it will fall to $20 or $15, but if it does Middle East conflicts will escalate to flat out war and oil prices will go up very quickly.
Martha, heard a well south of Stillwater just switched from a submersible to a surface pump jack, will this have any effect on daily production?
Steve, Oil is a geopolitical game. Russia intends to take over the Ukraine and other surrounding ex USSR countries. I believe the US and the Saudis are intentionally driving oil prices low because they can and to keep Putin from taking over the Ukraine. Back in the early 90’s the Ukraine was the Worlds 3rd largest stockpiler of nuclear weapons. In 1995 the Ukraine signed the Nuclear Non Proliferation agreement and gave up all their nuclear weapons in return of protection from the World’s super powers which included Russia. Now, Russia has reneged and the US, China, France and UK with the help of the Saudis may be hammering Russia with artificially low oil prices. I think T Boone and Harold Hamm are right, but their timing is off due to the US presidential election year because Dems are not the best at oil games. So, we may have another year of low oil prices unless war breaks out or Putin cries Uncle. Right now, I think Saudis are supplying China with cheap oil to keep the Chinese from aligning and making oil and gas deals with Russia. Iran is the wild card and the US just bought some of the wild card, but we will have to pay more to buy the rest. Anybody want to play a game of RISK. LOL
Rob, It shouldn’t hurt production. The submersibles are electric, expensive and often need replacing, so they may have become to expensive to operate with oil price so low.
Another O&G voice has spoken: Harold Hamm of Continental Resources predicted to the Wall Street Journal that oil will hit $60 by the end of the year and why. Remember Boone Pickens predicted $70 by the end of 2015 -it’s a crap shoot with the world situation changing so rapidly (except China)…who knows who to listen to?
https://us-mg205.mail.yahoo.com/neo/launch?.partner=sbc&.lt…
Good morning Martha. Had some good news over the weekend. AEW started drilling the second well in Section9 T18N 2E. I assume they wouldn’t be drilling now unless they are gambling that prices will start heading up in the coming year. Jimmy
Oil was up a little today, but Saudis will not cut production and the Chinese are starting a co-development field in Iran. Unless the US or Russia cuts production we could see lower prices.
Exxon 2016 reports “global energy demand will increase 25% between 2014 and 2040.”
http://www.ogj.com/articles/2016/01/exxonmobil-energy-outlook-sees-…
“By mid-2017, EIA expects the US to be a net exporter of gas for the first time since 1955.”
http://www.ogj.com/articles/2016/01/eia-us-gas-prices-expected-to-r…
Good News: Non-OPEC countries hinted they are going to cut production and Kuwait’s OPEC Governor Nawal al-Fuzaia said “OPEC is willing to cooperate.” Kuwait and Iraq say they will cut production if the Non-OPEC countries agree to do the same. Hopefully that would get oil back up to $50-60. http://news.morningstar.com/all/market-watch/TDJNMW20160126121/upda…
“Kuwait’s top representative at the Organization of the Petroleum Exporting Countries said prices will stay low this year and will likely trade between $40 and $60 a barrel until 2020, Summer Said reports.”
US told BBC that Putin made corrupt oil and gas deals. Kremlin says prove it. Spies like us should be able to do just that and force Putin to cut oil production. LOL!
http://www.msn.com/en-us/news/world/russia-demands-putin-corruption…
Natural gas could be turned into liquid transportation fuel using enzymes that feed off the CO2 they inject instead of waste water for enhanced oil recovery. This 2014 report claims Berkeley is working on it.
The reason the OCC allows salt water injection even though it’s causing earthquakes is because O/G companies are using salt water injection to test the formations to see if they will hold CO2. They have to determine underground fluid flow. The long reads below have maps that tell the story and it looks like our area is prime for CO2 enhanced oil recovery.
http://www.netl.doe.gov/File%20Library/Research/Carbon%20Seq/Refere…
http://www.netl.doe.gov/File%20Library/Research/Coal/carbon-storage…
Martha, There would be no earthquakes if the Mississippian had not been water fracked. It is like creating a Karst topography and something has to give when wastewater is injected.
Tom, Do you think there is a shallow epikarst?