Making America Great, Off Shore Drilling -- December 30, 2019
US returns to being a net oil exporter.
Rigzone.
Thanks to the shale oil revolution, for the first time since the
1940s, the United States exported more oil than it imported last
September. In that month, U.S. exports of crude oil and refined products
exceeded imports by 89,000 barrels a day, according to EIA statistics.
This marks a significant turning point, for only a decade ago, American
imports exceeded exports by a hefty 12 million barrels a day. Commenting
on this change, Bob McNally, a former energy consultant to President
George W. Bush and president of the consulting firm Rapidan Energy
Group, said, “the U.S. return to being a net exporter serves to remind
how the oil industry can deliver surprises -- in this case, the shale
oil revolution -- that upend global oil prices, production, and trade
flows.”
The International Energy Agency (IEA) believes the U.S. is on track
to become a sustained net oil exporter in either late 2020 or early
2021. It forecast an increase in U.S. exports of crude and refined
products from 550,000 b/d in October 2019 to average 750,000 b/d in
2020. This uptick will have a positive impact on the U.S. trade balance.
In 2018, th U.S.petroleum trade deficit stood at $62 billion or 10
percent of the country’s trade balance according to Rystad Energy.
Thanks to the ongoing growth in shale tight oil, the U.S. could enjoy a
petroleum trade surplus in 2020.
The shale oil revolution also has geopolitical consequences, not
least in that it will weaken the influence of America’s traditional
Middle Eastern oil suppliers, such as Saudi Arabia, United Arab Emirates
and Kuwait, on Washington’s foreign policy.
Offshore drilling poised for an upswing in 2020? Rigzone.
Offshore drilling has been depressed but, now with increased activity,
oil production could peak in 2020 before joining shale in a slowdown
that could dramatically rewrite market supply predictions. Overall rig
demand is forecast to rise from 473 units in 2019 to 550 units in 2021,
an increase of 16 percent according to IHS forecasts. Jeremy Lake, Vice
President, Transocean, confirms the 6 percent rise in active floating
rigs in the first half of this year and forecasts a market utilization
rate above 80 percent. Lake also expects demand for jack-up rigs to
increase from 345 units in 2019 to 388 units in 2021, a rise from 69 to
84 floaters and the number of drillships to increase from 59 to 78.
Gulf of Mexico oil output targeting record year.
Rigzone.
Despite a massive downturn in investment in the U.S. Federal Gulf of
Mexico (GOM), industry experts including Rystad Energy and the U.S.
based Energy Information Agency (EIA) are anticipating that 2020 will be
yet another record year. “2020 is expected to be another record year
with average production above 1.9 million barrels per day,” states
Joachim Milling Gregersen, an analyst on Rystad Energy’s Upstream team.
This is an additional 100,000 barrels a day on 2019 despite the
increasing ferocity of the regular hurricanes in the region, which force
the entire industry to close down for days at a time. For example,
Hurricane Barry caused a drop of 700,000 barrels of oil per day (bopd)
in U.S. crude production during the week of July 19th, according to the
U.S. EIA.
Note:
- GofM: 1.9 million bopd
- North Dakota: 1.5 million bopd
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