Overnight: militants take Iraq's largest refiner;
supplies one-third of Baghdad's energy;
foreign firms (oil and gas) start to evacuate their employees.
Coyote Blog remains
one of the best blogs on the net.
Front page, top story in Los Angeles Times today:
ObamaCare subsidies push cost of health law above projections. Well, above projections, one might add. It was also nice to see the
LA Times call it "Obamacare" in the headline. Some folks who wrote me a year ago felt I was being irresponsible to call the trainwreck (an alternate term for this program coined by one of the senators who actually championed the bill) "ObamaCare." But now even the
LA Times calls it Obamacare. This story will also be found in today's
WSJ.
Weekly petroleum update:
link here. Refinery inputs down 500,000 bopd; operating at 88% of capacity. Gasoline production decreased by 9 million bbls per day. US crude oil imports
up by 23,000 bopd, but four-week average is 8%
below the same four-week period one year ago.
US crude oil inventories decreased by 2.6 million bbls but at 387 million bbls, US crude oil inventories are in the upper half of the average range for this time of year. The price of oil is up slightly in early morning trading.
Active Rigs:
| 6/18/2014 | 06/18/2013 | 06/18/2012 | 06/18/2011 | 06/18/2010 |
|---|
| Active Rigs | 190 | 184 | 212 | 173 | 129 |
RBN Energy: this is sort of cool. This past Saturday I posted
a few thoughts on the US energy revolution, and mentioned SCOOP as an important play. Today, RBN Energy has a whole post devoted to SCOOP -- Harold Hamm's other sand box.
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Rigzone Stories From Yesterday
A 103-year-old New England company with roots in the wool trade and green
manufacturing has entered its second century in business on a solid
growth trajectory, thanks in part to opportunities from the shale
revolution underway in the oil and gas industry.
"Our factory is only a 5-hour drive from the heart of the Marcellus,"
said Daniel Weinstein, president and CEO of Rig Grip Incorporated.
The family-owned New Bedford, Mass.-based company sells a rugged
containment system for well pads designed to install in a single day.
Because of its durability, some gas operators are reusing the pad from
drilling through completions, noted Weinstein, adding this in turn
reduces expenses and the impact on landfills.
Iraq's oil growth targets look increasingly at risk, the International Energy Agency said, as threats to supplies from political instability and violence grow just as demand is picking up due to a stronger global economy.
Iraq is the second-largest producer in OPEC and its northern exports have been offline since March. OPEC output has also been hit by unrest in Libya, sanctions on Iran and oil theft in Nigeria.
"Within OPEC, Iraq remains the main source of most of the expected capacity growth, but this expansion looks increasingly at risk," Maria van der Hoeven, the IEA's executive director, wrote in the report's Foreword.
Still, the adviser to the United States and other industrialised countries also said in its Medium Term Oil Market Report on Tuesday that global growth in oil demand may start to slow down by the end of this decade due partly to high prices, and shale oil would start to spread outside the United States.
[Comment: to repeat, "global growth in oil demand may start to slow down by the end of this decade due partly to high prices." Let's parse that sentence:
- may: that one word says it all
- slow down: that's the nugget -- he says global growth in oil demand won't cease, it just might slow down a bit
- by the end of the decade: that's six years from now. The IEA did not forecast the Iraqi militant incursion that apparently was "yearslong" in planning; everyone in the Mideast must have known it was coming
- high prices: we are now in the longest period of sustained high oil prices in the history of the world and global demand in actually increasing; those two billion Chinese each want an Algore SUV just like everyone in the US
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Trainwreck
See also, the link to
The Los Angeles Times above on the same story.
First,
from The Fiscal Times:
Nearly two months after
Obamacare’s first open enrollment closed, we finally have a clearer
picture of what people are paying for the policies they bought on the
federal health insurance exchange.
Monthly premiums for silver
plans – the standard insurance policy sold on the exchanges – cost an
average of $345 a month this year for people who did not qualify for
subsidies, a new analysis from the administration shows.
However, for the overwhelming majority of Obamacare enrollees (87 percent) who did qualify for financial assistance, the average monthly premium on the silver plan costs about $69.
That’s an average tax credit of about $276 a month, or $3,312 a year.
Most of these folks are going to get caught up by the IRS and other federal agencies for lying. "The Big Sting" may be the new name for ObamaCare.
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The Wall Street Journal
Iraq may be imploding but "we"
got the mastermind in Benghazi who was so enraged by a anti-Muslim video that he grabbed a few of his friends and attacked the US Consulate and killed the US Amabassador. But as Hillary has said, "what does it matter?"
The White House continues to rule out airstrikes; but has flip-flopped again -- at least Mr Keryy has, suggesting now that he is willing to ally with Iran to perhaps possibly talk about what the two countries might possibly have in common, sort of, to respond to the Iraqi insurgency that began, oh, about two years ago.
Good news, the "upshot" of
the domestic oil boom. The latest spasm of Mideast violence has sent crude-oil prices climbing in recent weeks, a familiar action-reaction that frequently has proved to be a drag on economic growth. However, that dynamic appears to be less important as US dependence on Mideast oil is at a generational nadir. Thank you, Mr Bakken.
They recycle in West Virginia. Really?
Polls show erosion in President Obama's support. Really?
An explosion ripped through a gas transit pipeline in central Ukraine;
the flare was 200 meters (over 600 feet) high. Greenpeace, I assume, will call for an end to flaring in the Ukraine.
Gold in coal. Great graphic at the link.
UPS to factor box size into pricing. I wondered when that would happen. Boxes carrying Depend diapers are relatively light but very, very bulky.
Heard on the street:
Iraq foretells oil's dystopian future.
Yet Iraq's real significance for oil may have less to do with what transpires this summer and more over the rest of this decade.
The direct threat to the country's oil exports actually isn't acute yet. For now, the insurgency is focused in central Iraq, away from the main oil-producing and exporting areas in the south and the largely Kurdish-controlled north.
The bigger issue is what the sudden advance of the Islamic State of Iraq and al-Sham means for Iraq's oil-production growth prospects.
In its latest medium-term forecast, released Tuesday, the International Energy Agency cut its supply-growth outlook for Iraq. It now expects Iraq to be able to produce 4.29 million barrels a day by 2018, almost half a million barrels a day less than last year's forecast. Even so, Iraq still accounts for 61% of expected growth in output capacity controlled by the Organization of the Petroleum Exporting Countries.
So even if the near-term threat to supply from ISIS isn't catastrophic, the wider context potentially is.
Iraq's borders now look more like dotted lines, possibly portending a situation like Libya's, where rival groups vie for power or separation with a weak central government.
In Libya, that instability has caused production to yo-yo between virtually zero and about 1.75 million barrels a day.
Now, it is down at about 250,000 barrels a day. In 2010, before Libya blew up, the IEA forecast output of more than two million barrels a day in 2015. Now, Libya isn't seen getting anywhere near that even by 2019.