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USA and World Oil Production

USA and World Oil Production

The USA data below was taken primarily from the EIA’s Petroleum Supply Monthly while some were taken from the EIA’s Monthly Energy Review.

I have some bad news to report. The EIA no longer published World production data or Non-OPEC production data. This data had previously been published in the Monthly Energy Review.

The Monthly Energy Review’s data was one month behind the Petroleum Supply Monthly but now they jumped two months and are now one month ahead of the Petroleum Supply Monthly. They now publish the previous month’s numbers, June in this case, but now publish only US data. The Petroleum Supply Monthly is unchanged.

EDIT: The Petroleum Supply Monthly does publish some, incomplete, world data… through April or one month behind their USA data. I will use that with an explanation and comments next month.

The closest I can come to World oil production, through June, is the combined production of OPEC, Russia, the USA, and Canada. This is 70% of total World Production.

Here is the other 30% of World oil production. However, this data is only through March. Unfortunately, I can never update this chart because the EIA no longer publishes the data

This 30% of World oil production peaked in late 2015 and has declined an average of 450,000 barrels per day per year every year since.

Actually, in 2015 these countries averaged about 32% of World oil production but now averages about 29%.

I have no other source for World oil production. The IEA publishes quarterly projected data for the World and Non-OPEC. But this data is total liquids and only quarterly projections that bears little resemblance to actual C+C production.

 …click on the above link to read the rest of the article…

Is US Shale Cannibalizing Itself?

Is US Shale Cannibalizing Itself?

Shale

U.S. oil production continues to grow, but the shale industry is in the midst of a deceleration as low oil prices and a financial squeeze slow the pace of drilling.

The U.S. added 246,000 bpd of fresh supply in April, the latest month for which data solid is available. That put to rest concerns that the industry was in the midst of contraction, after production fell in January and February (some of which was due to offshore maintenance). Even as the rig count continues to fall, production grinds higher.

The EIA expects output to grow by another 70,000 bpd in July, with the Permian alone adding 55,000 bpd.

But the rate of growth is slowing. In April, production was up 1.6 million barrels per day (mb/d) compared to the same month a year earlier. By any measure, that is a massive increase. But it is down sharply from the nearly 2.1 mb/d year-on-year increase seen in August 2018, which looks set to be the peak in terms of the pace of growth.

U.S. oil production is not in danger of outright decline, not for the foreseeable future. But growth is clearly slowing. The U.S. could add 1.3 mb/d of new supply this year, according to an average of forecasts from multiple analysts, compiled by Reuters. That figure would be down from 1.5 mb/d of additional supply that came online in 2018. Related: Another Beneficiary Of The OPEC Deal Emerges

Financial stress is spreading, and top industry executives in Texas are arguably at their gloomiest in years. Consolidation and bankruptcies could pick up pace in the next few months, a bankruptcy attorney told Reuters.

 …click on the above link to read the rest of the article…

THE UNITED STATES A NET OIL EXPORTER?? The Dirty Little Secret

THE UNITED STATES A NET OIL EXPORTER?? The Dirty Little Secret

The United States became a net oil exporter for the first time in 75 years, or so they say.  While the U.S. may indeed be exporting more petroleum than it imports from time to time, there’s a dirty little secret behind the data.  And one of those secrets overlooked by some energy analysts and the press is that the U.S. still imports 7 million barrels per day of oil.

So, why would the United States continue to import 7 million barrels per day (mbd) of oil if it is indeed… a Net Oil Exporter??  Good question.  And, the answer to that question is hidden in the details, or as they say, “The devil is in the details.”

According to the EIA, the U.S. Energy Information Agency, the U.S. first became a net oil exporter during the week of Nov 30th, 2018 by exporting 211,000 barrels per day more than it imported.  Please understand the figures below also include petroleum products:

The graph shows the data as negative because it is presented as “net oil imports.”  Thus, a negative number means the U.S. is exporting more than it imports.  I have changed my figures in the chart to represent “net oil exports.”  As we can see, the U.S. had an even higher amount of net oil exports this past week at 675,000 barrels per day.  Regardless, the U.S. has been a net exporter for three weeks out of the past seven months. However, if we look into the details of this data, we will find out that the United States isn’t exporting this oil and petroleum because it “WANTS” to, but because it’s “FORCED” to. There’s a big difference.

NOTE: The charts in this article come directly from the U.S. Energy Information Agency website, with my added annotations.

 …click on the above link to read the rest of the article…

EIA tight oil estimates

EIA tight oil estimates

The US Energy Information Administration publishes Tight Oil Production Estimates by Play each month (can be found at link above.)  I noticed this month that the estimates seemed different than I remembered so I checked earlier estimates I had saved on my computer.  The chart below compares estimates from Dec 2018 to April 2019 (where the last month of data in the estimate is Dec 2018, Feb 2019, March 2019, and April 2019).

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As is clear from the chart the February and March estimates have each been revised lower over the past two updates. If this should continue, we might see relatively flat tight oil output for all of 2019.

I have revised my estimate for future US tight oil output to a 400+/-100 kb/d increase in monthly average tight oil output from December 2018 to December 2019.

EIA’s Electric Power Monthly – March 2019 Edition with data for January 2019

EIA’s Electric Power Monthly – March 2019 Edition with data for January 2019

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The EIA released the latest edition of their Electric Power Monthly on March 26th, with data for January 2019. The table above shows the percentage contribution of the main fuel sources to two decimal places for the last two months and the year 2019 to date.

In January, the absolute amount of electricity generated rose back to levels not seen since the end of summer in September 2018, probably as a result of the need for longer hours of lighting during the longer nights coupled with the increased needs for heating in the middle of winter. Coal and Natural Gas between them, fueled 61.49% of US electricity generation in January, with the contributions from Nuclear and Conventional Hydroelectric declining. The contribution from Natural Gas was up at 33.25%, from 31.71% in December, with the amount generated rising from 106,978 GWh to 118,935 GWh. Generation fueled by coal increased from 96,825 GWh to 101,019 GWh resulting in the percentage contribution falling from 28.70% to 28.24%. The amount of electricity generated by Nuclear plants increased from 71,657 GWh to 73,701 GWh with the resulting contribution actually declining from 21.24% to 20.60% in January. The amount generated by Conventional Hydroelectric increased from 23,728 GWh in December to 24,544 GWh in January with resulting contribution decreasing to 6.86% as opposed to 7.03% in December. The amount generated by Wind increased from 21,154 GWh to 22,493 GWh with the resulting contribution rising very slightly from 6.27% to 6.29% in January. The estimated total solar output rose from 4.962 GWh to 5,859 GWh with the resulting contribution rising from 1.47% to 1.56%. The contribution of zero carbon or carbon neutral sources declined from 38.59% in December to 37.41% in January.

The graph below shows the absolute monthly production from the various sources as well as the total amount generated (right axis).

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 …click on the above link to read the rest of the article…

Oil Prices Spike On Shale Slowdown

Oil Prices Spike On Shale Slowdown

Shale tower

The collapse of oil prices late last year, along with pressure from shareholders, has led to a slowdown in the U.S. shale industry.

The EIA released new monthly data on March 29, which revealed a decline in output of about 90,000 bpd between December and January, evidence that shale drillers slammed on the breaks after oil prices fell off a cliff in the fourth quarter. The 90,000-bpd decline came after a rather meager 35,000-bpd increase the month before, which was the weakest increase in months.

But the U.S. shale industry is facing more headwinds than just a temporary dip in oil prices. Shareholders have run out of patience with unprofitable drilling, and are demanding returns, which is tightening the screws on less competitive companies and forcing spending cutbacks across the board. More worrying for the industry is a growing recognition of the “parent-child” well problem – the unexpected poor performance of subsequent wells drilled in close proximity to the original “parent” well.

These obstacles are beginning to pile up. Schlumberger and Halliburton, the two top oilfield services companies, have predicted that shale drillers will be forced to collectively cut spending by more than 10 percent this year.

The slowdown could put some bullish pressure on the oil market, already suffering from outages in Venezuela, Iran and coordinated cuts from OPEC+. While U.S. inventories rose unexpectedly last week, much of the increase can be chalked up to turmoil in the Houston Ship Channel following a major fire at a petrochemical facility.

Indeed, some analysts see significant stock declines in the next few weeks. “The most visible inventory levels in the world…will fall victim to a potent mix of Venezuelan supply disruptions, a Houston Ship Channel chemical spill, and an uptick in refining runs,” Barclays wrote in a note on March 29. The investment bank sees WTI rising to an average of $65 per barrel this year. 

 …click on the above link to read the rest of the article…

NEXT OIL DOMINO TO FALL? Mexico Becomes A Net Oil Importer

NEXT OIL DOMINO TO FALL? Mexico Becomes A Net Oil Importer

While Mexico suffered the bloodiest year of violent deaths in 2018, even bigger trouble may be ahead for the embattled country.  For the first time in more than 50 years, Mexico has become a net importer of oil.  This is undoubtedly bad news for the Mexican Government as it has relied upon its oil revenues to fund a large percentage of its public spending.

However, it wasn’t always this way.  After the discovery of the huge Cantarell Oil Field in the Gulf of Mexico in 1976, Mexico’s oil production surged from 894,000 barrels per day to a peak of 3.8 million barrels per day (mbd) in 2004.  That year, Mexico’s net oil exports exceeded 1.8 mbd.

Unfortunately, the downturn of Mexico’s oil production was mainly due to the peak and decline of the Cantarell Oil Field, which topped out at 2.1 mbd in 2004 and is now below 135,000 barrels per day:

With the rapid decline in Cantarell’s oil production, Mexico’s net oil exports also plummeted from 1.8 mbd in 2004 to only 314,000 barrels per day in 2017.  However, the situation for Mexico’s net oil exports continued to deteriorate in 2018 as its domestic oil supply fell to a new low at the end of the year.

According to several sources, the BP 2018 Statistical Review, IEA’s OMR Reports, and the EIA’s data on World Oil Production, Mexico became a net oil importer in November 2018:

I find it strange that this has not yet been mentioned in the news as it is a very critical factor for the future of Mexico.  Now, I would like to qualify that the data I am using is accurate.  I found Mexico’s total petroleum production and consumption data from the EIA, the U.S. Energy Information Agency’s World Oil Production Browser, the IEA’s, the International Energy Agency OMR Reports, and BP’s 2018  Statistical Review.

 …click on the above link to read the rest of the article…

The EIA’s Optimistic Outlook

The EIA’s Optimistic Outlook

Most of the data below is taken from from the EIA’s Short-Term Energy Outlook. The data through February, 2019 is the EIA’s best estimate of past production and all data from March 2019 through December 2020 is the EIA’s best estimate of future production. However in most cases February production is highly speculative so I drew the “projection” line between January and February.

Understand the above chart is Total Liquids, not C+C as I usually post. As you can see the EIA expects world petroleum liquids to keep climbing ever upwards.

This is the EIA’s data for OPEC all liquids with Production data from April 2019 through December 2020.

Notice the EIA expects OPEC production to keep declining through December 2020. Also they expect total liquids to decline slightly faster than crude only. This is interesting since neither condensate nor other liquids are subject to OPEC quotas.

About two years ago I made note that the EIA expected Non-OPEC to plateau but they expected OPEC to keep increasing into the future. Now they have completely reversed themselves as they expect all future growth, at least for the next two years, to come from Non-OPEC countries.

The below  chart is from the EIA’a Monthly Energy review and is C+C through November 2018.

Virtually all crude oil increase since 2016 has come from three countries, USA, Russia and Canada. The spike upward (circled) in October and November 2018 was partially due to OPEC prepping for cuts. Every OPEC country made heroic efforts to increase productio during those two months in order to increase their quota. Quotas were set in December.

 …click on the above link to read the rest of the article…

U.S. ‘’Oil Weapon’’ Could Change Geopolitics Forever

U.S. ‘’Oil Weapon’’ Could Change Geopolitics Forever

Trump Senate

In a dynamic that shows just how far U.S. oil production has come in recent years, the U.S. Energy Information Administration (EIA) said on Monday that in the last two months of 2018, the U.S. Gulf Coast exported more crude oil than it imported.

Monthly net trade of crude oil in the Gulf Coast region (the difference between gross exports and gross imports) fell from a high in early 2007 of 6.6 million b/d of net imports to 0.4 million b/d of net exports in December 2018. As gross exports of crude oil from the Gulf Coast hit a record 2.3 million b/d, gross imports of crude oil to the Gulf Coast in December—at slightly less than 2.0 million b/d—were the lowest level since March 1986.

U.S. oil production hit a staggering 12.1 million b/d in February, while that amount has been projected to stay around that production mark in the mid-term then increase in the coming years. The U.S. is the new global oil production leader, followed by Russia and Saudi Arabia, while Saudi Arabia is still the world’s largest oil exporter – a factor that still gives Riyadh considerable leverage, particularly as it works with Russia, and other partners as part of the so-called OPEC+ group of producers. However, Saudi Arabia’s decades-long role of market swing producers has now been replaced by this coalition of producers, reducing Riyadh’s power both geopolitically and in global oil markets. In short, what Saudi Arabia could once do on its own, it has to do with several partners.

Meanwhile, U.S. crude oil production, particularly in the Gulf Coast region, is still increasing. In November 2018, U.S. Gulf Coast crude oil production set a new record of 7.7 million b/d, the IEA report added.

 …click on the above link to read the rest of the article…

Census Bureau, Treasury, EIA Detail American Insolvency

Census Bureau, Treasury, EIA Detail American Insolvency

Since 2007, US births and net immigration have consistently and unexpectedly fallen sharply.  Over the same span, US federal debt and unfunded liabilities have soared while federal tax receipts, as a percentage of the federal debt and unfunded liabilities, continue declining.  Total US energy consumption also peaked in ’07 and continues declining in contradiction to those soaring asset valuations.

Simply put, this article details an American insolvency and the ongoing attempt to print and inflate away this reality.  America has shown it isn’t afraid of (mis)using this digital printing press via collusion among the Federal Reserve, Treasury, and the Federal Government to disguise the simple truth that America is bankrupt and incapable of meeting its present and future obligations absent unlimited and unending monetization.

Demographic Development and Population Growth
According to the latest 2017 Census projection, the Census expects a near halving of population growth…or 50 million fewer Americans than it expected just 8 years earlier.  But critically, nearly all the projected declines are among the under 45 year old population while the 65+ year old population growth is still on track to swell.

Given the record low birth rates in 2017 and 2018, which came in 700 thousand annually below the ’08 Census projections, plus diminishing immigration, netting at least a half million annually below ’08 Census projections, the 2020 Census is likely to significantly further downgrade the potential for US population growth.  The impact for US economic growth, unfunded liabilities, and outgrowing personal, corporate, and federal debt is devastating.

What Happened?
From the mid 1990’s to 2007, a surge in immigration (both legal and illegal) and a rise in births resulted in significantly larger child bearing population and broad assumptions that America could outgrow its unfunded liabilities and debt issues. 

 …click on the above link to read the rest of the article…

EIA’s Electric Power Monthly – January 2019 Edition with data for November 2018

EIA’s Electric Power Monthly – January 2019 Edition with data for November 2018

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The EIA released the latest edition of their Electric Power Monthly on January 25th, with data for November 2018. The table above shows the percentage contribution of the main fuel sources to two decimal places for the last two months and the year 2018 to date.

In November, the absolute amount of electricity generated declined sightly as mild fall temperatures gave way to colder winter temperatures with demand for air conditioning giving way to demand for heating. Coal and Natural Gas between them, fueled 61.99% of US electricity generation in November, with the contributions from Nuclear and Conventional Hydroelectric edging up. The contribution from Natural Gas was down at 33.18%, from 38.11% in October, with the amount generated falling from 124,027 GWh to 106,804 GWh. Generation fueled by coal increased from 87,452 GWh to 92,738 GWh resulting in the percentage contribution rising from 26.87% to 28.81%. The amount of electricity generated by Nuclear plants increased from 59,397 GWh to 63,948 GWh with the resulting contribution actually rising from 18.25% to 19.87% in November. The amount generated by Conventional Hydroelectric increased from 18,779 GWh in October to 22,174 GWh in November with resulting contribution increasing to 6.89% as opposed to 5.77% in October. The amount generated by Wind decreased from 19,507 GWh to 17,991 GWh with the resulting contribution falling from 5.99% to 5.59% in November. The estimated total solar output fell from 7,625 GWh to 5,859 GWh with the resulting contribution falling from 2.34% to 1.82%. The contribution of zero carbon or carbon neutral sources rose from 34.10% in October to 36.97% in November.

The graph below shows the absolute production from the various sources as well as the total amount generated (right axis).

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 …click on the above link to read the rest of the article…

EIA’s Electric Power Monthly – December 2018 Edition with data for October

EIA’s Electric Power Monthly – December 2018 Edition with data for October

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The EIA released the latest edition of their Electric Power Monthly on December 26th, with data for October 2018. The table above shows the percentage contribution of the main fuel sources to two decimal places for the last two months and the year to date.

In October, as usual for this time of the year, the absolute amount of electricity generated continued to decline with the mid summer demand for air conditioning falling away further. Coal and Natural Gas between them, fueled 64.98% of US electricity generation in October, with the contributions from most other major sources edging up slightly. The contribution from Natural Gas was down at 38.11%, from 40.01% in September, with the amount generated falling from 142,745 GWh to 124,027 GWh. Generation fueled by coal declined from 96,743 Gwh to 87,452 GWh resulting in the percentage contribution falling from 27.12% to 26.87%. The amount of electricity generated by Nuclear plants decreased from 64,725 GWh to 59,397 GWh with the resulting contribution actually rising very slightly from 18.14% to 18.25% in October. The amount generated by conventional hydroelectric increased from 18,663 GWh in September to 18,779 GWh in October with resulting contribution increasing to 5.77% as opposed to 5.23% in September. The amount generated by wind increased from 16,022 GWh to 19,507 GWh with the resulting contribution rising from 4.49% to 5.99% in September. The estimated total solar output fell from 9,153 GWh to 7,625 GWh with the resulting contribution falling from 2.57% to 2.34%. The contribution of zero carbon or carbon neutral sources rose from 32.01% in September to 34.10% in October.

The graph below shows the absolute production from the various sources as well as the total amount generated (right axis).

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…click on the above link to read the rest of the article…

What’s Behind The Crash In Crude?

What’s Behind The Crash In Crude?

Basra oil terminal

Oil prices crashed to new one-year lows on Tuesday, dragged down by a deepening sense of global economic gloom as well as fears of oversupply in the oil market itself.

The reasons for the sudden meltdown were multiple. Rising crude oil inventories and expected increases in shale production weighed on oil prices, but the price crash was accentuated by the broader selloff in financials.

Genscape said that inventories are rising, which has raised fears of tepid demand amid soaring supply growth. “The Cushing number came in higher than anticipated … it’s definitely pointing to the concern that there’s more supply and demand is weakening,” said Phil Flynn, analyst at Price Futures Group in Chicago, according to Reuters. “The market is still very nervous about that.”

Crude prices fell 4 percent on Monday and about 7 percent on Tuesday. WTI dropped below $47 per barrel and Brent fell to the $56 handle.

The EIA said in its latest Drilling Productivity Report that it expects U.S. shale production to top 8.1 million barrels per day (mb/d) in January, rising by a massive 134,000 bpd month-on-month. The Permian alone will see production rise by 73,000 bpd next month. By way of context, the gains in the Permian are bigger than even some of the large monthly declines that we have seen in Venezuela, for instance.

Still, with WTI dropping below $50 per barrel, shale drillers will start to face increasing financial strain. That could force a slowdown in the shale patch. “We’re probably going to see a supply slowdown in the U.S.,” Michael Loewen, a commodities strategist at Scotiabank, told Bloomberg. “I do think that producers will react.”

…click on the above link to read the rest of the article…

No, The U.S. Is Not A Net Exporter Of Crude Oil

No, The U.S. Is Not A Net Exporter Of Crude Oil

Oil tanker at sea

Last week Bloomberg created quite a stir with this story: The U.S. Just Became a Net Oil Exporter for the First Time in 75 Years. I have seen a number of follow-up stories that praised the significance of this development, but others laughed it off as misleading or incorrect.

There is some truth to both viewpoints. Yes, the headline is somewhat misleading and requires some context. But there continues to be a trend in the direction of energy independence for the U.S. So, today I want to break down the numbers so readers can understand the truth about U.S. petroleum production, consumption, and exports.

Domestic Crude Production Has Surged

The Bloomberg story is based on data from the Energy Information Administration (EIA). Each week the EIA publishes detailed statistics on U.S. oil production, consumption, exports, and inventories in a report called the Weekly Petroleum Status Report. So, let’s go straight to the source.

For the week ending 11/30/18, the EIA reported that the U.S. produced 11.7 million barrels per day (BPD) of crude oil. That represents a 2 million BPD increase from the year-ago number. This number is generally accepted even by those who believe the Bloomberg headline was misleading.

Further down in the report, the category of Products Supplied is listed at 20.5 million BPD. This is approximate U.S. crude oil consumption for the week. Thus, as some skeptics of the story suggested, the bottom line is that the U.S. is burning more than 20 million BPD while producing less than 12 million BPD. Thus, the conclusion for some was that the U.S. isn’t close to being energy independent.

Other Supply

But there is important context between these numbers. First, the 20.5 million BPD is a fairly accurate representation of U.S. consumption, but there is a large U.S. production number that isn’t included in the crude oil production numbers.

…click on the above link to read the rest of the article…

Is Gasoline Demand Really Slipping?

Is Gasoline Demand Really Slipping?

Gas pump

Genscape’s Weekly Gasoline Demand Report data shows relatively flat growth in weekly year-on-year demand for September through November. On the other hand, the U.S. Energy Information Administration (EIA) Weekly Products Supplied data has shown year-on-year declines over the same period despite lower gasoline prices.

Our data shows U.S. total motor gasoline spot prices averaged $1.56/gal on November 28, down almost $0.70/gal from the high of $2.25/gal on October 2, pushing prices to the lowest level since June 30, 2017. Gasoline demand generally increases during prolonged periods of low prices, casting doubt on the demand declines.

What’s Going On?

Genscape analyzed this discrepancy and found the root cause lies in the methodology differences between our data and the EIA. While our data is based on actual gasoline liftings from rack locations headed to gas stations/consumption points, EIA Product Supplied data, both weekly and monthly, is a calculation of implied demand for refined products. The EIA uses a combination of survey components, production, inputs, stock change, ethanol adjustment, imports, and exports in a formula to estimate demand.

This disparity between the two numbers appears to be related to the recent decrease in gasoline imports and increase in gasoline export levels, two factors that the EIA includes in its formula to calculate Products Supplied. By adding imports and subtracting exports, this shift change in recent import/export patterns has had a depressive effect on the Weekly EIA Products Supplied level, showing declining year-on-year demand during a time of sharply falling prices at the pump. The basis for the Genscape Weekly Gasoline Demand Report is total U.S. rack liftings, sourced from our Supply Side data. These rack liftings represent the movements of gasoline from secondary (rack) terminals to retail stations.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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