Friday, April 29, 2016

Off The Net For Awhile --

In The Wall Street Journal today or yesterday or recently (our issue did not arrive today which seems to happen fairly often): Atlantic City facing bankruptcy.
Atlantic City has so little money left that it could miss a $1.8 million bond payment due Sunday, a step that would make it the first New Jersey municipality to default on debt since the Great Depression.
The Jersey Shore gambling destination has endured years of strain as a third of its casinos shut down. But now its cash levels are low enough that bankruptcy is a possibility for the 39,000-population city.
Once prized as a vacation destination because of its giant casinos and boardwalk, Atlantic City is in this position because of a declining economy and mounting debt. Its predicament is more severe than most distressed U.S. municipalities because it has the worst credit rating of any American city.
I track this stuff at this post.  Atlantic City first made the list on December 21, 2013. It's been a long time since I've re-visited the "cities" page.

Camden and Newark made the list some time ago. I was curious how they turned out. This was as curious as I got -- NJspotlight.com reported back on July 22, 2013:
Detroit’s bankruptcy sent shock waves through political circles and intensified the debate over whether state and local pension systems are underfunded, but don’t look for Camden or other distressed New Jersey cities to follow Detroit into bankruptcy court, municipal finance experts said.
While more than 20 counties and municipalities and authorities in 10 states have filed bankruptcy since 2003 because of poor financial practices or unsustainable pension debt, New Jersey has not had a local government bankruptcy since the Great Depression.
“Camden in many ways is in worse shape than Detroit, but Camden isn’t in bankruptcy and isn’t going to go into bankruptcy,” said Marc Pfeiffer, assistant director of the Local Government Research Center at Rutgers University’s Bloustein School of Planning and Public Policy. 
“While New Jersey has a few municipalities that are severely distressed, we are considered one of the better states in oversight and managing funds, and it’s a system that continues to work. The states where municipalities have gone bankrupt were those with a lack of oversight and limited engagement by the state government until it’s too late,” said Pfeiffer, who spent more than 20 years tracking New Jersey municipal finances before retiring last year as deputy director of the state Department of Community Affairs’ Division of Local Government Finance.
Camden, Paterson, Trenton, Harrison, and Asbury Park are all under supervision by the state’s Local Government Finance Board and part of a special transition aid program “designed to keep municipalities afloat,” Pfeiffer said, and both Harrison and Salem City are under close fiscal supervision because of problems with development bonds.
A bankruptcy like Detroit just isn’t going to happen in New Jersey,” agreed Jon Moran, the New Jersey State League of Municipalities’ longtime legislative director.
“Here in New Jersey, for a community to declare bankruptcy, you have to get approval from the Local Government Finance Board, and before it gets to that point, the Board and the Director of the Division of Local Government Services will already have taken steps to fix the problem.”
It appears Atlantic City somehow slipped off their radar scope.

I really don't know.

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A Note for the Granddaughters

Speaking of New Jersey, one of my best summers (in retrospect) was in Westfield, NJ, a bedroom community of NYC, many years ago. I always have to check the journal to get the year correct ... let's see... give me a moment ... ah, yes, here it is ... the summer of 1971. 

I had a summer job there; it was the most difficult job I ever had, but I probably learned more about life / unit of time (time best measured in hours, perhaps -- it was that intense). I've blogged about it several times before so I won't repeat the story. A typical "Westfield" post is here, but it doesn't say much about the job. Whatever. But it does talk about mini Basque cheese, which is more interesting.

Our younger daughter is now in the cheese-making business, focusing on goat cheese.

The Scariest Chart On The US Economy? -- American Enterprise Institute -- April 29, 2016 -- IN PROGRESS

US productivity at this link. The first graph below is as it appears at the link. The second graph with some notes added so that I could put the first graph in historical context.


At the link, the author suggests three interpretations:
  • US innovation has come to an end; low-productivity workers first to lose jobs in recession; workers now returning to the work force are the lower-productivity workers
  • we are mismeasuring productivity; current productivity formulas/statistics were based on "steel-and-wheat" economy; those algorithms/assumptions/formulae don't work for an IT economy
  • current "lull" is to be expected; innovation off the radar scope drags productivity down; "seed corn" being planted for another cycle of productivity gains
I assume "productivity growth" is unrelated to global economy. That assumption may be terribly wrong. And it's important to differentiate between "global economy" and "globalization." This might be a good place to start when sorting that out

Let's say US innovation and entrepreneurism have not changed. Let's say IT has matured (it's been around since at least 1984).

If one takes out US innovation, entrepreneurism, and IT maturation, then is one left with policy? I don't know. But one wonders.


Legend:
  • RR: exact years of President Reagan's administration
  • Bill: exact years of President Clinton's administration
  • 1: first term for George W Bush (an overhang from Bill's presidency)
  • 2: second term for George W Bush and first term for Barack Obama (reflects the ship of state as it started turning in the first term of George W Bush)
  • BHO: the second term of President Obama and the overhang that Hillary will inherit
I have some thoughts but before I go into them, I think I will take a break; let folks think about the graph.

The writer at the link suggests this is the "scariest chart about the US economy." Be that as it may, it should certainly generate a lot of reflection and discussion. 

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National Productivity

As defined/discussed at wiki, about halfway down that webpage, under the subsection called "National Productivity."
There are different measures of productivity and the choice among them depends either on the purpose of the productivity measurement and/or data availability. One of the most widely used measures of productivity is Gross Domestic Product (GDP) per hour worked. 
This, of course, is fairly simplistic compared to an alternate method called or multi factor productivity or total factor productivity.
Based on the nature of the discussion at the AEI link at the very top of this post suggests that productivity in this case is being defined as GDP/hours worked.

Update In Saudi Arabia's Reserve Asset Base -- Courtesy Of John Kemp -- April 29, 2016

In 2015, Saudi Arabia set its 2016 budget based on $60 oil. Prior to that, as far as we know, Saudi's budget had been based on $100 oil for years. Running the numbers, suggests there is no way "we" will average $60-oil for calendar year 2016. To get there, oil will have to be at $80 this autumn.

For Saudi, $60 oil is not much better than $40 oil, and long-term, Saudi can't survive on $60 oil.


Some takeaways from the graph above:
  • 27 months of data are shown; Saudi's reserve assets decreased in all but six of those months
  • but even with $110 oil for eight months (2014), the kingdom showed outright losses in two of those months, and minimal increases in most of the other months; during this period Saudi consistently said it "liked" $100-oil but in fact they needed a higher price; in June, 2014, at prices > $110 (and trending upward), the kingdom showed a negative growth in reserve assets
  • in the past 14 months, the kingdom has lost almost $150 billion in reserve assets
  • there's more to reserve asset management than just the price of oil; in January, 2015, despite an average price of Brent lower than it was later in the year, the kingdom showed a slight increase; for the entire rest of the year, significant decreases
  • look where John Kemp has set the "x" axis: at $100 oil; in 2017, it will be interesting to see if the graph is re-set to reflect $60 oil
  • in February, 2015, when average price of Brent was $60, the kingdom lost $20 billion; based on most recent losses, it does suggest that the kingdom set $60/bbl as the basis for their 2016 budget
An IPO of 5% of a 2-trillion-dollar company will provide a one-time infusion of $100 billion cash. 

XOM And CVX Report Today -- April 29, 2016

From the AP:
Exxon Mobil Corp. (XOM) on Friday reported first-quarter earnings of $1.81 billion.
On a per-share basis, the Irving, Texas-based company said it had profit of 43 cents.
The results exceeded Wall Street expectations, but Exxon does not adjust its reported results based on one-time events such as asset sales. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of 31 cents per share.
Others reporting today:

CVX: forecast, a 20-cent/share loss;
TransCanada (TRP.TO): forecast, a 66 cent/share profit;

Data Points From RBN Energy's Update On US LPG Exports -- April 29, 2016

In a long note like this, there will be typographical and factual errors. Personal comments / opinion may be interspersed with "facts." If this information is important to you, go to the source. I do this simply for my benefit to insure that I really do read the article and not skim through it.

This is taken from "episode 2" of RBN Energy's update of US LPG exports from the Gulf coast. It really is quite an amazing story and suggests that one of the big stories of the 21st century will be the emergence of US as the global energy powerhouse.

Some of the data points follow.

First, the data points from "episode 1":
  • US domestic production of NGLs (like propane and butane is soaring
  • US liquified propane gas (LPG) exports in the past three years have rocketed to the top
  • US exports of LPG now surpasses exports by the old Big Three: UAE, Qatar ("cutter"), and Algeria
  • the rise in LPG exports may be ending
  • exports from the Gulf coast may be in for a decline
  • more propane and butane from the Marcellus and Utica will be re-routed to Marcus Hook, PA
  • demand for new propane dehydrogenation plans and flexible steam crackers will be climingg
This episode, episode 2, will focus on how the Panama expansion will affect LPG exports. The data points follow.
  • the Panama expansion will be operations within a few weeks
  • all but the world's very biggest LNG vessels will be able to transit the canal
  • huge times savings from the Gulf coast to Asia: from more than six weeks (around Cape of Good Hope) to three weeks (Panama Canal)
  • daily rates for these sea-going tankers have tanked
  • two "events" have changed LPG export dynamics: Marcus Hook and PDH
    • Mariner East 2 pipeline across Pennsylvania will re-route 275,000 bopd by 2017; to Marcus Hook, PA
    • once at Marcus Hook, LPG-BR (rail) across the US; propane at those terminals is at the expense of propane at Gulf coast terminals
    • more domestic processing through increased number of PDH plants
  • US LPG exports have been on a tear
    • January, 2013: 184,000 bopd LPG exports from Gulf coast
    • January, 2016: 1,047,000 bopd LPG exports from Gulf coast (nearly six-fold increase in three years)
  • destinations:
    • exports to China: 111,000 bopd (up from 17,000)
    • Japan 70,000 bopd (up from 55,000)
    • South Korea: 37,000 bopd (up from 11,000 bopd)
    • Singapore: 30,000 bopd (up from 4,000 bopd)
    • China is the biggest importer of US LPG, beating out Canada (87,000 bopd in 2015, more than half was ethane)
    • rounding out the top six: Mexico (91,000), Brazil (47,000), and the Netherlands (46,000), Dominican Republic (32,000)
  • the LPG export terminals along the Gulf coast
    • EPD/Houston Ship Channel: 
      • completed its 2015 expansion; can now load one VLGC every 24 hours (from 300,000 bopd to 533,000 bopd)
    • Targa Resources/Galena Park
      • 3Q14: completed its expansion, from 100,000 bopd to 233,000 bopd 
    • Sunoco Logistics/Nederland/Mariner South
      • anchor customer is Shell; 150,000 bopd, or almost 20% of Gulf coast exports
    • Occidental Petroleum/Ingleside
      • commissioned in 2015, but exports have been negligible
    • Phillips 66/Freeport
      • building the latest LPG export terminal, a 150,000 bopd facility at Freeport, TX; to be on-line 3Q16
    • Buckeye Partners/Trafigure/Corpus Christi
      • accounts for about 2% of Gulf coast exports so far this year
Total LPG export capacity from Gulf coast: 1,200,000 bopd export capacity
Bottom line: Marcus Hook, PA, and PHD plants in the US have changed the dynamics of US LPG exports 

Many, Many Story Lines In Today's RBN Energy Post On US LPG Exports From The Gulf Coast -- Friday, April 29, 2016; More Bad News For ObamaCare -- People Have Quit Signing Up; Dropping Out In Large Numbers

This is the kind of typographical error I used to make when I first started blogging. It's an error made by lack of attention to detail; or complete ignorance. See how long it takes you to spot the glaring error in the "cut and paste" taken from The Street: Real Money:
Inside the United States, [Hess has] pared back fracking operations in both the Bakken, where it currently operates only two wells and in the Utica shale, where it currently operates none.
Whatever. Time to move on.

One know things have really changed in the Bakken when one is relieved that the number of active rigs remains near 30.

Active rigs:


4/29/201604/29/201504/29/201404/29/201304/29/2012
Active Rigs2986189186209

RBN Energy: US LPG export terminals poised to serve the Pacific Basin.
Fueled by soaring domestic production of natural gas liquids (NGLs) like propane and butane, U.S. liquefied petroleum gas (LPG) export volumes the past three years have rocketed to the top, surpassing exports by the old Big Three of LPG: United Arab Emirates, Qatar and Algeria. But that rise in LPG exports may be ending, and the share of exports made from Gulf Coast docks may be in for a decline. More propane and butane will be pulled from the Marcellus and Utica to the docks at Marcus Hook, PA, and demand for propane on the Gulf Coast—from new propane dehydrogenation plants and flexible steam crackers—will be climbing. That suggests that less LPG may need to be exported from the Gulf Coast to keep the market in balance. In today’s blog we continue our look at the soon-to-open Panama Canal expansion with an updated examination of U.S. LPG export terminals along the Gulf Coast.
As we said in Episode 1, the wider, deeper locks being built along the Panama Canal will (finally) be in business within a few weeks, enabling the world’s growing fleet of Very Large Gas Carriers (VLGCs) that move most U.S. LPG exports to take that important short-cut between the Caribbean and the Pacific. (All but the world’s very biggest liquefied natural gas (LNG) vessels will be able to float through the expanded canal as well.) The time saved will be huge; a trip from the Gulf Coast to Asia around the Cape of Good Hope takes more than six weeks, compared with only three weeks-plus via the Panama Canal. And time, of course, is money. Cut the time it takes for a Houston-to-Tokyo round trip in half and (aside from the canal tolls) you’ve halved the LPG freight rates.
And that’s not the only way LPG shipping costs are coming down. According to a recent analysis by Fearnley Securities, average daily VLGC rates are now below $40,000 (in part because of all the new carriers being built—one a week in recent months) and daily rates may fall to $25,500 (at or below the representative break-even price) in 2017. That would of course be good news for those hoping to sell increasing volumes of U.S.-sourced LPG to Asian markets (including the India subcontinent), which use the propane/butane mix primarily for cooking and heating but also as a petrochemical feedstock.
As we discussed in yesterday’s blog, however, when the 275 Mb/d Mariner East 2 pipeline across Pennsylvania comes into service in 2017, it will pull significant volumes of propane/LPG to the Marcus Hook export terminal near Philadelphia, leaving less Marcellus/Utica-sourced propane and butane to be railed out of the region to distribution terminals across the U.S. Volumes at those terminals will be replaced by propane otherwise headed to the Gulf Coast. Also, flexible steam crackers (which we expect to turn to more propane as ethane supplies tighten and ethane prices rise) and new PDH plants will increase domestic (more specifically, Gulf Coast) consumption of propane, thereby leaving less propane available to export from Gulf Coast terminals—especially under RBN Energy’s Cutback Scenario, which is a pricing view similar to the current forward curves for crude oil and gas, and which would result in a lot less propane being produced over the next five years than most of the market had been figuring before the oil price collapse.
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The Other Page
 
Warning: this is not an investment site. Do not make any investment, financial, travel, or relationship decisions based on anything you read here or think you may have read here.

I say that because I'm going to post/link some financial stories. I post them not because I'm invested in them (in fact, I am not directly invested in any of them to the best of my knowledge); I'm posting them because they help put the Bakken in perspective; they have interesting story lines; and/or they simply caught my eye and I couldn't sleep earlier this morning, and I didn't want to read any more of Dorothy Parker right now and the Wall Street Journal has not yet arrived.

UPS says it may owe the Central States Pension Fund almost $4 billion. It's a complicated story (at least for me) but I "love" UPS so I thought I would read the article:
United Parcel Service Inc. warned it may have to take a charge of as much as $3.8 billion related to a potential pension-fund obligation.
The cost would be triggered if the U.S. Treasury Department approves benefit cuts to protect the solvency of the Central States Pension Fund, UPS executives said Thursday. UPS pulled out of the fund in 2007 but agreed to make up any losses its remaining members experienced.
The world’s largest package-delivery company may have to record a charge of $3.2 billion to $3.8 billion if the government approves the benefit cuts, executives said in an earnings conference call. UPS plans to oppose such a move by the Treasury. Even with the charge, earnings this year probably still will fall within the company’s forecast of $5.70 to $5.90 a share.
Call Bernie. Call Hillary. More evidence of income inequality. Pig-to-man pancreas cell transplant will make scientist highest-paid US executive of 2015. Patrick Soon-Shiong will soon be inshiongly rich:
Patrick Soon-Shiong performed the world’s first pig-to-man cell transplant to treat diabetes. He sold two drug companies, making enough to become a billionaire and buy a stake in the Los Angeles Lakers basketball team. Now Soon-Shiong can also add this distinction to his resume: the highest-paid U.S. executive of 2015.
The 63-year-old physician received a $329.7 million pay package last year as chief executive officer of NantKwest Inc., a cancer-research firm that went public last July and has a market value of $715.5 million. That sum vaults him to the No. 1 spot on the Bloomberg Pay Index, a ranking of the top-paid executives at companies that trade on U.S. exchanges.
Most of his pay stems from 19.4 million stock options granted before the initial public offering.
Hess. I am not interested in the discussion about investing per se, but I was curious on The Street's headline: "...based on the Hess strategy." So, what's the Hess strategy?
Two of the U.S. independents reporting this week, Hess and Pioneer Natural Resources, show vastly different approaches, with Pioneer continuing to increase production at all costs and Hess showing restraint on spending until oil markets recover.

Pioneer's CEO Scott Sheffield has been singular in his goals during this bust in oil prices. It's been about maintaining production growth throughout.
Indeed, in his latest quarterly report he broke his company record again, delivering 220,000 barrels of oil equivalent, an increase of 7,000 barrels of oil equivalent (BOE) over the fourth quarter of 2015. But revenues from this gain in production, with oil below $50 a barrel, have not translated to the kind of cash flow that PXD will need to continue to keep beating its own records.
With a projected $1.4 billion in cash flow for 2016, Sheffield will still come in $600 million short of his own guidance for covering capital expenditures for the year. With that kind of cash burn, it'll need a seriously large asset sale, or a much less likely secondary stock or bond capital infusion. That's not a strategy for an oil price that remains below $50 for very long.
Now, look at Hess.
CEO John Hess was quick to begin his quarterly comments by noting a lower-for-longer strategy. This corresponds to the $1.6 billion stock secondary it did in February, shoring up their balance sheet for the long haul.  Inside the United States, it's pared back fracking operations in both the Bakken, where it currently operates only two wells and in the Utica shale, where it currently operates none. It's assigned much of their capex for 2016, lowered 40% from 2015 levels, to offshore projects in the Gulf of Mexico and Guyana. These are growth projects that reflect a long-term investment return on capital that current shale assets onshore cannot deliver. But with revenues missing by $47 million for the quarter and down 36% from 2015, Hess shares were pummeled, dropping below $60 a share.
And, of course, more dismal news regarding ObamaCare. From Investor's Business Daily:
Aetna reported 911,000 ObamaCare exchange members as of March 31, down more than 4% from over 950,000 at the same time a year ago.

The news is somewhat of a surprise after Anthem said it saw a modest increase in customers largely thanks to nonprofit co-ops going out of business in some of its 14 markets like New York and Colorado.

Anthem ObamaCare enrollment rose 8.6% to 975,000, from 898,000 a year ago.

Centene, a Medicaid insurer specialist that’s rapidly expanding its ObamaCare exchange reach with low-premium, high-deductible plans, recently reported a 55% enrollment spike to 683,000. UnitedHealth (UNH) had 795,000 exchange customers at the end of Q1, but has said it will exit all but a “handful” of states in 2017.

Total exchange sign-ups rose 8.5% to 12.7 million, from 11.7 million a year ago, but it’s not yet clear how many people actually paid. Last year, 1.5 million had dropped out by the end of March.

Reports from six states show that ObamaCare enrollment has shrunk about 14% from the number reported in February, but it’s unclear if that trend will hold.

Aetna management expressed optimism that its exchange business will break even in 2016, though it’s still getting a feel for the medical costs of this year’s members, given the relatively large amount of customer churn from year to year.

Overall, Aetna’s ObamaCare-compliant enrollment, including off-exchange customers, fell to 1.2 million from 1.275 million a year ago.

Thursday, April 28, 2016

For The Archives -- Fracking And Groundwater -- April 28, 2016

From Rigzone:
The impact of horizontal drilling and hydraulic fracturing on groundwater quality in the Cline shale play is not believed to be permanent, new research from the University of Texas at Arlington (UTA) suggests.
The research is the first to analyze the groundwater quality in the Cline shale region of West Texas before, during and after the expansion of unconventional exploration and production.
Researchers found that water samples from private wells contained chlorinated solvents, alcohols and aromatic compounds exclusively after multiple unconventional oil wells had been activated within 3.1 miles of the sampling sites.
Large fluctuations in pH and total organic carbon levels also were detected in addition to a gradual accumulation of bromide.
These changes and levels are abnormal for typical groundwater quality, said Kevin Schug, the study’s lead author and UTA’s Shimadzu Distinguished Professor of Analytical Chemistry and director of UTA’s Collaborative Laboratories for Environmental Analysis and Remediation (CLEAR), in an April 26 press release.
However, the results also suggest that containment from unconventional drilling may be variable and sporadic, not systematic, and that some toxic compounds associated with areas of high unconventional drilling may degrade or become diluted within the aquifer over time.
The study also indicated that contamination pathways are complex; various toxic compounds were detected in groundwater seemingly at random times in areas of high drilling activity. Schug said that more research is needed to precisely quantify and understand contamination cycles as well as to understand aquifer resilience to pollutants.
I Beg Your Pardon (Rose Garden), Lynn Anderson
 
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A Note to the Granddaughters

I generally take Sophia -- she will be two years old this June -- to the park every day for about an hour or so. I try to keep it varied and interesting. Today we took five dice. Sophia loves to play Yahtzee. She has no idea what she's doing but she loves to put the five dice in a cup and roll them, and then throw her arms up, and yell "Yahtzee" when she rolls a Yahtzee. She gets a Yahtee on every roll.

On the way home, Sophia was getting antsy, so I gave her the five dice to play with on her tray on her stroller. About half-way home I noticed that one die was missing.

I feigned my irritation, telling Sophia we were going to have to go back over the ground covered, and look for the missing die. She was very serious, and, she, too, leaned out over the stroller, to help look for the missing die.

We had backtracked about a block when I noted she was holding a die in her hand, and there were still the original four in her tray.

Putting "2 and 2" together, it was clear we were never missing the fifth die. Sophia had put it in her mouth and that's where I had not checked. I guess to keep from getting in trouble, when I feigned irritation, she kept her mouth shut and continued the charade of looking for the lost die, and then when the time was right, put the "lost" die in her hand so I could see it.

Never a dull moment. 

Lifeline For Oil Companies -- April 28, 2016

I do not recall when I first thought this, or when I first posted it. Most recently, I posted it April 12, 2016:
  • $40 oil is a lifeline for US shale oil.
  • $50 oil will allow most US shale oil companies to survive.
  • $60 oil, they will thrive.
Over at Rigzone today, this is the headline of the lead article:  Rising Oil Prices Throw Lifeline to Shale Producers. The article is written by the most accessible global oil analyst currently on the scene: John Kemp, writing from London, for Retuers.
Brent prices for 2017 ended trading above $50 per barrel on Wednesday for the first time since mid-December following the largest and most sustained rally in prices since the oil slump started.
The average for the 12 futures contracts expiring in 2017, called the calendar strip, has risen by 34 percent from its recent low of $37.45 on Jan. 20 to $50.26 on April 27.
Spot prices, represented by the nearest futures contract, dominate the headlines and are of most interest to analysts and financial investors. Most hedge funds and other money managers concentrate on nearby futures contracts because they are the most liquid.
Calendar strips for future quarters and years are far less prominently reported in the media and analyst commentaries. But the majority of crude producers and consumers such as airlines rely on calendar strips to hedge future sales and purchases.
For producers struggling to meet debt payments and avoid breaching the terms of loan covenants, rising prices are a chance to lock in future revenue and reduce downside risks.
Oilfield Dad, Bryan Martin

EIA's Update On Iraq -- April 28, 2016

From the EIA:
The U.S. Energy Information Administration released its updated country analysis brief on Iraq’s energy sector.
There is some good background information here for future stories and could enough for a separate story now.
Iraq is OPEC’s second-largest crude oil producer and holds the fifth-largest proved crude oil reserves in the world.
In 2015, Iraq’s production increased by almost 700,000 b/d compared with the production level in 2014, representing the largest year-over-year increase since Iraq’s production recovery in 2004, following the start of the Iraq war...Iraq continues to lower its ambitious oil production targets...After lowering the target to about 9.0 million b/d by 2020, Iraq may lower the target down to 6.0 million b/d if oil prices continue to be low. -- U.S. EIA
From the link:
Iraq was the second-leading contributor to the growth in global oil supply in 2015, behind only the United States. Crude oil production in Iraq, including fields in the Kurdistan Region of northern Iraq, averaged 4.0 million barrels per day (b/d) in 2015, almost 700,000 b/d above the 2014 level.
Iraq is the second-largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC) and accounted for about 75% of total OPEC production growth in 2015. Iraq's oil consumption decreased slightly in 2015, and as a result, all of the crude oil production increase was exported to international markets. 

What Has Been Will Be Again, What Has Been Done Will Be Done Again; There Is Nothing New Under The Sun -- Ecclesiastes 1:9 -- April 28, 2016; Pioneer In The Wolfcamp -- Cash Costs Down To $14/Bbl

Flashback, 1987.

This is a story for of the US oil bust back in 1987. It is remarkable how it sounds just like today. A huge "thank you" to the reader who sent me this link.

From The New York Times, March 1, 1987, almost 30 years ago:
This session in Mr. Rudman's den did not seem to be a run-of-the-mill opening for a discussion about the oil industry, but very little is run of the mill about Mr. Rudman, from his remarkable vigor to his contrarian instincts to his eye-catching attire. At 77, he is a legend in the oil industry, a maverick who has made his fortune by following his instincts. And now that exploration efforts have slowed to a virtual standstill in the depressed oil patch, the venerable oilman is once again moving against the crowd, spending millions of his own dollars to drill new wells.
Mr. Rudman, whose career dates to back the 1930's, is an independent operator in a field increasingly dominated by corporate behemoths, a health food devotee in a world more attuned to t-bones, an aficionado of plumed hats and red velvet tuxedos in an industry that prefers conservative suits or blue jeans. And as unremitting gloom shrouds his fellow oilmen, he also stands out as an optimist.
''I've been waiting 56 years for this,'' said Mr. Rudman. ''It's the greatest opportunity that has ever existed in my lifetime. The way I figure is that if the price of oil is 50 percent of what it was and your drilling cost is 50 percent of what it was, you're in the same situation only the deals are so much better now.'' During the boom years, he said, too many investors were crowding each other out of the best opportunities. ''Right now, I figure I'm going to go at it as hard as I can. I'm spending every dime of my income on drilling wells.''
Other oilmen maintain that Mr. Rudman's optimism should be taken with a few grains of salt. He can afford to be enthusiastic, they say, because he scored a remarkable coup in 1981, at the height of the oil boom, by selling off all his producting wells to the Petro-Lewis Corporation. In a debt-ridden industry, he is one of the last of an endangered species, a cash-rich oilman. He said he is investing millions of his own dollars in approximately 70 wells this year.
Mr. Rudman bases his optimism on the lowered costs of drilling wells in a depressed industry. With the number of active oil rigs in the United States down to 839 from a peak of 4,530 in 1981, rigs can sell for 10 cents on the dollar. Promoters who once charged fat fees for oil deals are now desperate for investors. Most of the wells that could be drilled for $1 million to $3 million a few years back can be done for half that now. Mr. Rudman figures he has more chance of getting in on a deal that could turn into a major find, and he is certain the current carnage in the industry will eventually lead to shortages and substantially higher prices.
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Forbes Suggests The Same Thing

Forbes suggests America's oil boom just taking a breather:

Pioneer Natural Resources is a bellwether company, a Platonic ideal of all that is possible for America’s oil industry. Pioneer has the strongest balance sheet of any of the American independents with $2.5 billion in cash against about $3 billion in debt. It has built up a massive 800,000-acre position in the Permian Basin, a region that has emerged as the single best oil province in America, where the rigs are still running even at these prices.
Finding oil is not the issue for Pioneer, it’s how to get it out of the ground as quickly and efficiently as possible. The company figures it has about 12,000 drilling locations in the Permian, enough for about 90 years of drilling at its current pace. Pioneer’s balance sheet is strong enough and its land is good enough that even as America’s oil industry has flatlined (with U.S. oil output down to 9 million bpd from a high of 9.6 million) Pioneer has managed to keep growing its output, which at 222,000 barrels of oil (and gas equivalent) per day is about 10% higher than a year ago.
The company, as I wrote in this late 2014 profile, will be a survivor.
Pioneer reported impressive first quarter earnings yesterday and its stock is up 6% in Tuesday morning action. Sure the company had a big net loss, bringing in just $685 million in revenue against $1.1 billion of expenses. But when you back out that pesky stuff like $350 million in non-cash depreciation expense, Pioneer pretty much broke even. It is still running 12 rigs (down from 30 in 2014), and has gotten its cash costs down to about $14 per BOE.