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U.S. Shale Isn’t As Strong As It Appears
U.S. Shale Isn’t As Strong As It Appears The extraordinary cost reductions achieved by North American oil and gas companies have likely reached their limit, and any boost in profitability for much of the U.S. shale and Canadian oil sands industries will have to come from higher oil prices, according to a new report from […]
What A Fed Rate Hike Means For U.S. Shale
What A Fed Rate Hike Means For U.S. Shale North American shale oil and gas companies have proven that they can adapt their business model through the lower crude oil prices cycle. Now, the new challenge for shale producers is how to adjust their financial strategy when the Federal Reserve (Fed) raises interest rates. Since […]
The Oil War Is Only Just Getting Started
The Oil War Is Only Just Getting Started It’s been a month now that investors and analysts have been closely watching two main drivers for oil prices: how OPEC is doing with the supply-cut deal, and how U.S. shale is responding to fifty-plus-dollar oil with rebounding drilling activity. Those two main factors are largely neutralizing […]
Will Russia End Up Controlling 73% of Global Oil Supply?
Will Russia End Up Controlling 73% of Global Oil Supply? Russia has played a master stroke in the current oil crisis by taking the lead in forming a new cartel, but it’s a move that could spell geopolitical disaster. The meeting between Russia, Qatar, Saudi Arabia and Venezuela on 16 February 2016 was the first […]
Lower Oil Prices Are Shaking the World
Lower Oil Prices Are Shaking the World The long-term effects will echo for a decade or more. Oil prices fell by over half from June 2014 to January 2015 (Brent: $110 to $50), then another one-third since (to $35). Natural gas and coal prices have also plunged, partially due to the same forces but also from […]
America’s Top Shale Gas Basin in Decline
America’s Top Shale Gas Basin in Decline The natural gas drilling frenzy is grinding to a halt, as the industry struggles with excess supply. Natural gas prices have plunged to their lowest levels in more than a decade this month, dipping below $1.80 per million Btu (MMBtu). The shale gas revolution is an old story […]
Can The Oil Industry Really Handle This Much Debt?
Can The Oil Industry Really Handle This Much Debt? As the crude industry has been wrestling with low oil prices that declined by over 50 percent since its highest close at $107 a barrel in 2014, many exploration and production companies worldwide and in the U.S., in particular, have faced large shortfalls in revenue and […]
Saudi Oil Minister Puts On Brave Face Amid Severe Headwinds: “Eventually, Economic Producers Will Prevail”
Saudi Oil Minister Puts On Brave Face Amid Severe Headwinds: “Eventually, Economic Producers Will Prevail” As the EM world looks on helplessly while Saudi Arabia’s war with the US shale complex (and, by extension, with the Fed) serves to keep crude prices depressed putting enormous pressure on commodity currencies and accelerating emerging market outflows, the […]
Oil Companies Running Out Of Options
Oil Companies Running Out Of Options The financial pressure on indebted oil and gas companies continues to mount, putting them in a bind as they try to mend their deteriorating balance sheets. As their debt rises, drillers have had to divert more of their operating cash flow to servicing that debt. Or, put another way, […]
How Fracking Changed the Economics of Oil Production Around the World
How Fracking Changed the Economics of Oil Production Around the World James Meadway, chief economist at the New Economics Foundation, explains the interrelated economics behind China’s ‘Black Monday’ stock market crash, Middle Eastern oil and US fracking. The ‘fracking revolution’ has transformed the economics of oil production globally, with the US becoming a bigger producer than Saudi Arabia and […]
It Just Doesn’t Matter
It Just Doesn’t Matter When an avalanche is about to descend upon you, does it really matter which snowflake was the penultimate cause? While it’s interesting (in a mental masturbation kind of way) to debate the genesis of a pending market collapse, environmental chaos, or energy cliff, in the end, it really doesn’t matter–unless, of course, […]
Why Saudi Arabia Won’t Cut Oil Production
Why Saudi Arabia Won’t Cut Oil Production Nine months after OPEC decided to leave its production target unchanged and pursue market share instead of trying to prop up prices, the group is facing a set of complex problems and decisions going forward. At first blush, the collapse of oil prices and the resiliency of U.S. […]
Saudi Arabia Faces Another “Very Scary Moment” As Economy, FX Regime Face Crude Reality
Saudi Arabia Faces Another “Very Scary Moment” As Economy, FX Regime Face Crude Reality “They are working for their market share, not for the price,” Kazakh Prime Minister Karim Massimov told Bloomberg on Saturday, during the same interview in which he predicted that sooner or later, dollar pegs in Saudi Arabia and the UAE would […]
True Believers
True Believers There is a special species of idiot at large in the financial media space who believe absolutely in the desperate and tragic public relations bullshit that this society churns out to convince itself that the techno-industrial high life can continue indefinitely, despite the mandates of reality — in particular, the fairy tales about […]
Big Oil in Retreat
Big Oil in Retreat On July 14, 2011, at TomDispatch, Bill McKibben wrote that he and a few other “veteran environmentalists” had issued a call for activists to descend on the White House and “risk arrest to demand something simple and concrete from President Obama: that he refuse to grant a license for Keystone XL, a new pipeline […]
