A growing number of nations are negotiating to drop the use of the U.S. dollar as the currency used to trade oil, which originally would be replaced by a basketfull of currencies, and over the long haul an as yet undetermined currency.
Inluded in the countries currently negotiating are France, the Arab states, Japan, China, Russia, and Brazil. India may eventually get on board as well, making it a considerable force in the future. Goals are to make the change from trading oil in U.S. dollars to a basket of currencies by 2018.
Nations understand the extraordinary and misguided practices and policies of the U.S. government and the way it has spent money to bailout the numerous industries they refuse to allow to fail, and the amazing size of the debt incurred to do it.
All this means the U.S. dollar will continue to fall in value as the printing of money continues from the Federal Reserve.
America will find itself struggling to maintain its economic dominance as a result, and there's literally nothing that can be done about it unless the horrid economic policies are abandoned and the political will is there to make it happen.
It's doubtful that will happen any time soon, and so we'll probably have to go through a lot more pain before America and its politicians abandon the economic path they're traveling and return to financial sanity.
Monday, October 5, 2009
Saturday, September 26, 2009
Norway Ready to Go to Gates of Hell for Oil
Norway Oil
Having explored the majority of its Norwegian shelf, Norway is looking to other more remote regions in order to remain a major player in the oil industry, which has largely paid for the welfare nation's lifestyle.
One area they're looking toward is a volcanic island in the Arctic with the strange name of Jan Mayen, which was at one time supposedly called the 'Gates of Hell,' based on the possibly true legend of being discovered by Brendan, and Irish monk, who when seeing the vulanic activity thought he had literally discovered the Gates of Hell.
Norway will find it hard to finance its welfare state if oil production continues to fall as it has recently, with estimates in this year alone dropping by 9.7 percent, according to the Petroleum Directorate. Oil and gas accounts for about 25 percent of the economic output of Norway at this time.
The first step will be to drill a shallow well outside of Jan Mayen to make an assessment on the geological structures in the area. Oil drilling in the region won't begin until about 2020.
Norway Oil
Having explored the majority of its Norwegian shelf, Norway is looking to other more remote regions in order to remain a major player in the oil industry, which has largely paid for the welfare nation's lifestyle.
One area they're looking toward is a volcanic island in the Arctic with the strange name of Jan Mayen, which was at one time supposedly called the 'Gates of Hell,' based on the possibly true legend of being discovered by Brendan, and Irish monk, who when seeing the vulanic activity thought he had literally discovered the Gates of Hell.
Norway will find it hard to finance its welfare state if oil production continues to fall as it has recently, with estimates in this year alone dropping by 9.7 percent, according to the Petroleum Directorate. Oil and gas accounts for about 25 percent of the economic output of Norway at this time.
The first step will be to drill a shallow well outside of Jan Mayen to make an assessment on the geological structures in the area. Oil drilling in the region won't begin until about 2020.
Norway Oil
Wednesday, September 9, 2009
Brazil Finds Another Huge Oil Field
Brazil continues to increase its reputation as a major player in the oil business, discovering another major oil field, with estimates of up to two billion barrels of oil able to be recovered from it.
This oil discovery is called Guara, and is the result of the new techniques being used which can find oil under the salty sea bottom, which were undiscoverable before.
Estimates in the overall region is what is being called pre-salt reserves, cover a huge range, from a low of 60 billion barrels of oil to 150 billion barrels of oil.
There is no doubt that once the economic crisis begins to wane down, which could still be several years away, Brazil is poised to be come the major oil producer in the region, and as a result change the political and social structure of the region, as they become the largest Latin American provider of energy, overtaking the socialist foolishness of Hugo Chávez and his continuing destruction of Venezuela.
So far it is the largest area of oil discovered this century, and more than likely won't be the last, as the ocean floors are scoured for new oil fields that couldn't be seen in the recent past.
This oil discovery is called Guara, and is the result of the new techniques being used which can find oil under the salty sea bottom, which were undiscoverable before.
Estimates in the overall region is what is being called pre-salt reserves, cover a huge range, from a low of 60 billion barrels of oil to 150 billion barrels of oil.
There is no doubt that once the economic crisis begins to wane down, which could still be several years away, Brazil is poised to be come the major oil producer in the region, and as a result change the political and social structure of the region, as they become the largest Latin American provider of energy, overtaking the socialist foolishness of Hugo Chávez and his continuing destruction of Venezuela.
So far it is the largest area of oil discovered this century, and more than likely won't be the last, as the ocean floors are scoured for new oil fields that couldn't be seen in the recent past.
Monday, September 7, 2009
Everyone Drilling Oil but U.S.?
Oil Exploration and Drilling
It's extraordinary that countries around the world are drilling and pursuing oil, with the exception of off the coasts of America and within its borders as well, where billion's of barrels are sitting there because of the far left environmental activists pressuring Democrats, who refuse to ignore them and open up our land and coasts to the billions of barrels of oil already known to be available to us, along with the potentially huge, unknown reserves there for the taking.
I'm not saying American Oil Companies aren't drilling, just that they're not drilling off the coasts of the U.S., which would be very lucrative and helpful to the American economy and American people.
Bizarrely, the Obama administration continues to resist drilling off the shores of the U.S. while oil companies from other nations cash in, like BP from the UK did recently in the Gulf, where they found billions of barrels of oil recently, although it'll take time to know how much it is overall. They are also going to drill a second place in attempts to tap into even more reserves, while the U.S. oil policy is in shambles because of political special interests.
Even though Congress repealed the restrictions on 85 percent of American waters, the Department of Interior under the Obama administration hasn't issued one lease to an oil company for drilling and exploration.
Foolishly, the result will be continued dependence on foreign oil and whims, while we sit on potential resources that could help ween us from this foreign oil dependence in a big way.
Interestingly, the discovery of the Tiber oil by BP in the gulf recently has led some to believe it is a big piece of evidence that strengthens the abiotic theory of oil's origins.
The abiotic theory of oil asserts that any type of hydrocarbon, which includes gas and oil, is the result of natural chemical processes deep in the earth which rise through the fissures of the planet and is usually deposited in sedimentary layers beneath the surface.
What is hypocritical in all this is under the Obama administration, the U.S.Export-Import bank loaned $2 billion to Brazil's Petrobras for furthering their offshore drilling efforts. This gives support to billionaire George Soros, an avid Obama supporter, who owns a stake in Petrobras, which is a state-owned oil and gas company.
Oil Exploration and Drilling
It's extraordinary that countries around the world are drilling and pursuing oil, with the exception of off the coasts of America and within its borders as well, where billion's of barrels are sitting there because of the far left environmental activists pressuring Democrats, who refuse to ignore them and open up our land and coasts to the billions of barrels of oil already known to be available to us, along with the potentially huge, unknown reserves there for the taking.
I'm not saying American Oil Companies aren't drilling, just that they're not drilling off the coasts of the U.S., which would be very lucrative and helpful to the American economy and American people.
Bizarrely, the Obama administration continues to resist drilling off the shores of the U.S. while oil companies from other nations cash in, like BP from the UK did recently in the Gulf, where they found billions of barrels of oil recently, although it'll take time to know how much it is overall. They are also going to drill a second place in attempts to tap into even more reserves, while the U.S. oil policy is in shambles because of political special interests.
Even though Congress repealed the restrictions on 85 percent of American waters, the Department of Interior under the Obama administration hasn't issued one lease to an oil company for drilling and exploration.
Foolishly, the result will be continued dependence on foreign oil and whims, while we sit on potential resources that could help ween us from this foreign oil dependence in a big way.
Interestingly, the discovery of the Tiber oil by BP in the gulf recently has led some to believe it is a big piece of evidence that strengthens the abiotic theory of oil's origins.
The abiotic theory of oil asserts that any type of hydrocarbon, which includes gas and oil, is the result of natural chemical processes deep in the earth which rise through the fissures of the planet and is usually deposited in sedimentary layers beneath the surface.
What is hypocritical in all this is under the Obama administration, the U.S.Export-Import bank loaned $2 billion to Brazil's Petrobras for furthering their offshore drilling efforts. This gives support to billionaire George Soros, an avid Obama supporter, who owns a stake in Petrobras, which is a state-owned oil and gas company.
Oil Exploration and Drilling
Wednesday, September 2, 2009
BP in Big Oil Discovery in Gulf of Mexico
Oil Discovery BP
Drilling down to over 35,000 feet, BP Plc made a significant oil discovery in the Gulf of Mexico at the Tiper Prospect, with an estimate of over 3 billion barrels of oil found there.
The 35,000 plus foot drill is the deepest exploration well in history.
It is expected to be in production during the latter part of the next decade, and help BP bring oil production to about 600,000 barrels a day sometime after 2020.
According to BP's lead executive for exploration and production, Andy Inglis, this could increase production of the company between one to two percent from between 2013 and 2020. That of course depends upon how long it takes to get the oil field on line.
This is the second material discovery in what is called the Lower Tertiary in the Gulf of Mexico by BP. The other one was a smaller field named Kaskida. Kaskida is estimated to hold about 3 billion barrels of oil, and Tiber is bigger than that, said BP. Plans are in place to drill as second well in Tiber sometime in 2010.
According to BP, they are the largest net leaseholder in the Lower Tertiary area.
Oil Discovery BP
Drilling down to over 35,000 feet, BP Plc made a significant oil discovery in the Gulf of Mexico at the Tiper Prospect, with an estimate of over 3 billion barrels of oil found there.
The 35,000 plus foot drill is the deepest exploration well in history.
It is expected to be in production during the latter part of the next decade, and help BP bring oil production to about 600,000 barrels a day sometime after 2020.
According to BP's lead executive for exploration and production, Andy Inglis, this could increase production of the company between one to two percent from between 2013 and 2020. That of course depends upon how long it takes to get the oil field on line.
This is the second material discovery in what is called the Lower Tertiary in the Gulf of Mexico by BP. The other one was a smaller field named Kaskida. Kaskida is estimated to hold about 3 billion barrels of oil, and Tiber is bigger than that, said BP. Plans are in place to drill as second well in Tiber sometime in 2010.
According to BP, they are the largest net leaseholder in the Lower Tertiary area.
Oil Discovery BP
Saturday, August 8, 2009
Chevron Angola Oil Discovery
In what is at this time only being identified as a major oil discovery, Chevron announced that the find off Angola's shores still needs to be confirmed by further drilling, but the prospects of a significant oil field are pretty much ensured; it's only a matter of how much oil the field holds, which in cases like this are usually considered over 500 million barrels.
The oil and natural gas field is located off the Cabinda coast of Angola, enlarging the already significant portfolio Chevron has in the African nation.
Its affiliate Cabinda Gulf Oil Co made the find, of which Chevron has a 39.2 percent stake in. The state oil company of Angola - Sonangol owns 41 percent of Cabinda, while Total SA of France owns 10 percent and ENI SpA of Italy has a 9.8 percent stake in Cabinda.
This find continues to underscore the West African nation's growing importance to Chevron and the country's rising stature as an energy producer as its neighbor Nigeria continues to deal with militant attacks on its oil pipelines, which has cut oil production by 20 percent over the last three years.
This is one of many oil and gas discoveries off of Angola, which produced 1.85 million barrels of oil a day in July 2009.
Chevron, which now pumps over 500,000 barrels of oil a day from Angola, said the discovery, in Block 0, was drilled in March in 397 feet of water to a total vertical depth of 13,000 feet. It encountered over 225 feet of net hydrocarbon pay in the Upper Pinda formation, according to the company. Overall, Angola's output stands at about 2.1 million barrels of oil a day, which is a huge 53 percent increase from 2006.
Chevron also said the 79-3XST1 discovery well had a flow rate of 11.6 million cubic feet of natural gas and 2,550 barrels of liquid hydrocarbons a day.
The oil and natural gas field is located off the Cabinda coast of Angola, enlarging the already significant portfolio Chevron has in the African nation.
Its affiliate Cabinda Gulf Oil Co made the find, of which Chevron has a 39.2 percent stake in. The state oil company of Angola - Sonangol owns 41 percent of Cabinda, while Total SA of France owns 10 percent and ENI SpA of Italy has a 9.8 percent stake in Cabinda.
This find continues to underscore the West African nation's growing importance to Chevron and the country's rising stature as an energy producer as its neighbor Nigeria continues to deal with militant attacks on its oil pipelines, which has cut oil production by 20 percent over the last three years.
This is one of many oil and gas discoveries off of Angola, which produced 1.85 million barrels of oil a day in July 2009.
Chevron, which now pumps over 500,000 barrels of oil a day from Angola, said the discovery, in Block 0, was drilled in March in 397 feet of water to a total vertical depth of 13,000 feet. It encountered over 225 feet of net hydrocarbon pay in the Upper Pinda formation, according to the company. Overall, Angola's output stands at about 2.1 million barrels of oil a day, which is a huge 53 percent increase from 2006.
Chevron also said the 79-3XST1 discovery well had a flow rate of 11.6 million cubic feet of natural gas and 2,550 barrels of liquid hydrocarbons a day.
Tuesday, July 28, 2009
CFTC Caves in to Government
Government Interference in Oil Markets
Somehow the Commodity Futures Trading Commission, which has always said it has never found a correlation between speculation and oil price swings, has suddenly got regulation religion, and now says it's ready to go before Congress and 'admit' speculators are playing a huge role in price runups. This is plain evil, and an investigation needs to be conducted on where this new found information has come from, and if shady politicians and some big energy companies are behind the new found information.
Any price swing in any commodity can happen short term with commodity investors, but to say that is what's behind the price swing of last year which pushed oil prices up is in itself huge speculation, and just another attempt by the socialist Obama and Democrats to attempt to play god, thinking they can alter the age-old reality of supply and demand.
One of the major reasons this is ludicrous is commodity investors can make money when prices go up and down, and so the idea they can push prices up on their own has no merit, and supply and demand always bring it back to reality either way, as consumer respond to price swings. It's as simple as that, and the strong-arming and dishonesty emerging concerning so-called speculators being able to manipulate the market in any meaningful way is just ugly and a lie.
Some Democrats need to be investigate concerning this, along with the Commodity Futures Trading Commission to see if there is any criminal activity concerning this sudden turn around by the CFTC, which is unprecedented.
Misguided and misinformed watchers say this will help consumers. No it won't. Consumers do struggle at times when prices swing up, but they also profit tremendously when prices go down. To say government regulation of the oil market will make a difference is stupid and ignorant.
The failure of socialism and turning of communist countries to capitalism has already shown that governments cannot and should not attempt to interfere with any market, as the unintended consequences that always follow never seem to teach them to stick to minding their own business, rather than interfering with the market place.
Government Interference in Oil Markets
Somehow the Commodity Futures Trading Commission, which has always said it has never found a correlation between speculation and oil price swings, has suddenly got regulation religion, and now says it's ready to go before Congress and 'admit' speculators are playing a huge role in price runups. This is plain evil, and an investigation needs to be conducted on where this new found information has come from, and if shady politicians and some big energy companies are behind the new found information.
Any price swing in any commodity can happen short term with commodity investors, but to say that is what's behind the price swing of last year which pushed oil prices up is in itself huge speculation, and just another attempt by the socialist Obama and Democrats to attempt to play god, thinking they can alter the age-old reality of supply and demand.
One of the major reasons this is ludicrous is commodity investors can make money when prices go up and down, and so the idea they can push prices up on their own has no merit, and supply and demand always bring it back to reality either way, as consumer respond to price swings. It's as simple as that, and the strong-arming and dishonesty emerging concerning so-called speculators being able to manipulate the market in any meaningful way is just ugly and a lie.
Some Democrats need to be investigate concerning this, along with the Commodity Futures Trading Commission to see if there is any criminal activity concerning this sudden turn around by the CFTC, which is unprecedented.
Misguided and misinformed watchers say this will help consumers. No it won't. Consumers do struggle at times when prices swing up, but they also profit tremendously when prices go down. To say government regulation of the oil market will make a difference is stupid and ignorant.
The failure of socialism and turning of communist countries to capitalism has already shown that governments cannot and should not attempt to interfere with any market, as the unintended consequences that always follow never seem to teach them to stick to minding their own business, rather than interfering with the market place.
Government Interference in Oil Markets
Thursday, June 4, 2009
Oil Business and News | American Energy Resources to Begin Drilling in New Oil Reserve
Oil Business and News
Declining consumer demand has taken a toll on many in the oil and gas industry.
Reports the oil refiner Valero Energy is expecting a second quarter loss because of the lackluster demand.
Earlier in the year when the price of oil settled near $35 per barrel many oil and gas services companies had to forgo new investments because of the low price and weak demand. Oil is now hovering near $68 a barrel with MarketWatch reporting a Goldman Sachs estimate that oil prices will hit $85 by year end.
But one Colorado-based oil and gas exploration company is moving forward with a new project.
American Energy Resources announced plans to drill from a newly discovered secondary oil reserve in Lane County, Kansas. The well is known as Doyle's Dome #7 and is expected to produce over 200 barrels a day and remain active for 25 years or longer.
"This is the second largest well American Energy Resources has ever drilled," said Don Allen, president and founder of American Energy Resources. "Our use of 3-D seismic mapping technology allows the company to hit 'sweet spots' with multiple pay zones."
Oil Business and News
Declining consumer demand has taken a toll on many in the oil and gas industry.
Reports the oil refiner Valero Energy is expecting a second quarter loss because of the lackluster demand.
Earlier in the year when the price of oil settled near $35 per barrel many oil and gas services companies had to forgo new investments because of the low price and weak demand. Oil is now hovering near $68 a barrel with MarketWatch reporting a Goldman Sachs estimate that oil prices will hit $85 by year end.
But one Colorado-based oil and gas exploration company is moving forward with a new project.
American Energy Resources announced plans to drill from a newly discovered secondary oil reserve in Lane County, Kansas. The well is known as Doyle's Dome #7 and is expected to produce over 200 barrels a day and remain active for 25 years or longer.
"This is the second largest well American Energy Resources has ever drilled," said Don Allen, president and founder of American Energy Resources. "Our use of 3-D seismic mapping technology allows the company to hit 'sweet spots' with multiple pay zones."
Oil Business and News
Thursday, February 19, 2009
The Myth of Peak Oil
It's sometimes hard to look at all the nonsense being perpetuated by people with agendas, as it seems there's almost nothing important any more that isn't politicized in some way, and so ultimately lied about. Gold is one of those things, and another major one, which I want to talk about is peak oil.
So by definition, what is peak oil? It simply means that oil that was relatively easy to reach and extract has been depleted. The question then becomes if that is in reality the case. The answer is absolutely no. The peak oil myth is just that - a myth. That doesn't mean there won't come a day when that becomes the reality, it's just that it isn't the case now, and won't be any time soon.
So why is the myth continually perpetuated? Because it takes the eyes and minds of people off of why oil prices sometimes surge and the caused behind it. The major reason there's the beginnings of an artifially induced oil peak is because of consequences of political actions put into law which forbids access and drilling on easy-to-drill and extract oil. Think of Alaska and off the coastlines of the U.S. There are billions of barrels of oil available, yet not allowed to be drilled for because of pressure from radical environmentalists and lawmakers looking to curry favor from the media which loves this type of idiocy.
This is mostly brought about from the endless introduction of fear as the key tool used by these liars in order to manipulate public policy to their hidden agendas.
These manipulators even try to ask the types of irrelevant questions that herd people a certain way so, again, they don't look at the facts, realities and agendas behind them. For example, they use terms like what is going to happen "after oil." Or other statements like "surviving peak oil," or "life after peak oil. The implication is that peak oil is reality that we must now deal with, rather than the fact that there's absolutely no basis for concern at this time if the current regulations were removed. That's what is trying to be hidden from the minds of people.
Besides the obvious billions of barrels of oil in Alaska and off American coastlines, where else is there oil available? In the United States itself there is enough oil in shale to make it the largest oil reserves in the world; far beyond what Saudi Arabia has. That is a proven fact. There are of course also have billions of barrels of oil in the Canadian sands area, which will also last for decades. These are just a couple of areas which don't include many other areas in the world.
So why imply an oil shortage, what is the hidden agenda behind it. Some of it is philosophical, as ignorant people literally think of the earth as their mother, and to drill into their mother is actually hideous in their warped minds. Another reason for asserting oil depletion is in order to promote agendas related to radical environmentalists and their business allies, who want to try to cash in on the misguided focus on what is called "alternative energy," where billions of dollars are being wasted because of the fear mongering people who make it look like the world is falling in order to gain access to public and private money to further their purposes. It's nothing more than that.
There's no oil crisis, we're not close to losing easy access to oil supplies.
While I do agree that oil prices will eventually have to go up, especially until ways of figuring out how to extract oil from shale is made cheaper, there is still so much oil available that to say we're in any type of crisis is dishonest at best, and ignorant at worst.
Even new ways of scouring the ocean floors and seeing what lies beneath the salty residue has resulted in billions of barrels of oil being discovered by Brazil, and their just getting going on that, as Petrobras continues to look for more deposits. Granted, it's far below the ocean floor and will be more costly - at this time - to extract, is does show how much oil there is that hasn't been discovered yet, and how much would be avaiable when restrictions on drilling for oil on coastlines are lifted.
The world oil supply is fine, and world oil reserves in a solid place. Oil consumption for now has cut back, as economic weakness causes consumers to drive less and stay around home more. That will extend signficantly the amount of oil available and its use.
So you don't have to worry or be fearful over the dishonest assertions by those with private agendas. There's billions and billions of barrels of oil available, it's just not being allowed to be drilled for because of existing laws which eventually will be withdrawn when real pressures from the population make it politically dangerous to keep people from cheaper oil and gas prices.
So by definition, what is peak oil? It simply means that oil that was relatively easy to reach and extract has been depleted. The question then becomes if that is in reality the case. The answer is absolutely no. The peak oil myth is just that - a myth. That doesn't mean there won't come a day when that becomes the reality, it's just that it isn't the case now, and won't be any time soon.
So why is the myth continually perpetuated? Because it takes the eyes and minds of people off of why oil prices sometimes surge and the caused behind it. The major reason there's the beginnings of an artifially induced oil peak is because of consequences of political actions put into law which forbids access and drilling on easy-to-drill and extract oil. Think of Alaska and off the coastlines of the U.S. There are billions of barrels of oil available, yet not allowed to be drilled for because of pressure from radical environmentalists and lawmakers looking to curry favor from the media which loves this type of idiocy.
This is mostly brought about from the endless introduction of fear as the key tool used by these liars in order to manipulate public policy to their hidden agendas.
These manipulators even try to ask the types of irrelevant questions that herd people a certain way so, again, they don't look at the facts, realities and agendas behind them. For example, they use terms like what is going to happen "after oil." Or other statements like "surviving peak oil," or "life after peak oil. The implication is that peak oil is reality that we must now deal with, rather than the fact that there's absolutely no basis for concern at this time if the current regulations were removed. That's what is trying to be hidden from the minds of people.
Besides the obvious billions of barrels of oil in Alaska and off American coastlines, where else is there oil available? In the United States itself there is enough oil in shale to make it the largest oil reserves in the world; far beyond what Saudi Arabia has. That is a proven fact. There are of course also have billions of barrels of oil in the Canadian sands area, which will also last for decades. These are just a couple of areas which don't include many other areas in the world.
So why imply an oil shortage, what is the hidden agenda behind it. Some of it is philosophical, as ignorant people literally think of the earth as their mother, and to drill into their mother is actually hideous in their warped minds. Another reason for asserting oil depletion is in order to promote agendas related to radical environmentalists and their business allies, who want to try to cash in on the misguided focus on what is called "alternative energy," where billions of dollars are being wasted because of the fear mongering people who make it look like the world is falling in order to gain access to public and private money to further their purposes. It's nothing more than that.
There's no oil crisis, we're not close to losing easy access to oil supplies.
While I do agree that oil prices will eventually have to go up, especially until ways of figuring out how to extract oil from shale is made cheaper, there is still so much oil available that to say we're in any type of crisis is dishonest at best, and ignorant at worst.
Even new ways of scouring the ocean floors and seeing what lies beneath the salty residue has resulted in billions of barrels of oil being discovered by Brazil, and their just getting going on that, as Petrobras continues to look for more deposits. Granted, it's far below the ocean floor and will be more costly - at this time - to extract, is does show how much oil there is that hasn't been discovered yet, and how much would be avaiable when restrictions on drilling for oil on coastlines are lifted.
The world oil supply is fine, and world oil reserves in a solid place. Oil consumption for now has cut back, as economic weakness causes consumers to drive less and stay around home more. That will extend signficantly the amount of oil available and its use.
So you don't have to worry or be fearful over the dishonest assertions by those with private agendas. There's billions and billions of barrels of oil available, it's just not being allowed to be drilled for because of existing laws which eventually will be withdrawn when real pressures from the population make it politically dangerous to keep people from cheaper oil and gas prices.
Tuesday, February 10, 2009
Oil Investment | 2009 and Beyond
The oil and gas industry continues to struggle as overall demand continues to decline. That has of course, as far as oil demand goes, created the current contango or super contango situation which has resulted in a great chance to make safe money through oil investment.
Even though oil and gas companies will have some short term difficulty and challenges, as the economic circumstances continue to gradually improve, people will start driving, flying and traveling again, and we'll see oil demand and oil prices start to increase again.
Oil news has been somewhat grim, but again, crude oil isn't going to drop in need or use anytime soon, and even though mainstream media outlets love to make big oil companies look like villains, they will continue to be profitable far into the future because of the demand for it will not stop any time soon.
Many people that in reality oppose the use of oil for a variety of stupid reasons, like to try to make the argument that we've reached the point where oil has peaked, or peak oil, so that we much waste billions of dollars in order to save humanity as fuel resources dry up. This is nothing else but a lie, and the use of fear as a tool to take taxpayers dollars and waste them on things like ethanol, which has turned into a disastrous debacle and the source of an endless number of engine breakdowns, especially among small engines. Creating an atmosphere of torment and fear has ended with idiotic waste of time and money, when in reality there are billions of barrels of oil on U.S. land and off it's shorelines. Only the hateful environmentalists and their private agendas generate the type of publicity that makes this typeo of scenario possible, as the thought of drilling into their mother earth is atrocious to these earth worshippers, as they are offended by humans existing, but god help you if you drill into their "mother."
That's my little rant. Now the reality. Just in the rock shale of the United States alone, it is estimated there is far more available proven oil reserves than exists in Saudi Arabia. This is trying to be covered up so Americans don't call the government and radical environmentalists to account for their crimes against humanity by not only lying, but covering up the fact that there is that much oil available for use. This doesn't even take into account the oil off our shorelines or in Alaska. Go beyond that and we have the new methods that can see hidden oil underneath the salt of the oceans, and where Brazil's Petrobras has uncovered billions more in oil fields beneath the ocean floor, and they're just getting started. Add the huge amount in the Canadian oil sands and you get the idea. The idea of peak oil is a joke at this time, and will be for many decades into the future. Those opposing oil and gas companies have been hiding the fact of how much oil is available so they can create a panic in order to get access for their pet projects in relationship to alternative energy. A growing number of those in the energy business are doing the same as tax credits and other incentives "blind" their eyes to the huge source of existing energy we still have.
So the oil and gas industry along with the oil and gas companies are in reality in a strong position in the long term, as oil and gas will flow through the pipelines for decades and decades into the future, which will not only provide many oil and gas jobs, but keep things running while we lose the emotional baggage and slowly look at realistic and legitimate sources of alternative energy going forward. There's absolutely no lack of oil and gas we can drill for and produce at this time, and there is no need to create the false sense of urgency the media has been doing through its going to bed with environmentalists.
Oil exploration needs to continually be encouraged, as well as removing barriers to oil well drilling. Oil development will continue to be a huge business in the world, and the resources out there are still staggering, as far as the amount of oil and gas still out there to be extracted from the earth and underneath the oceans.
Where does all of this leave oil and gas as an investment? It will be a very strong and profitable place to put our money, both over the short and long term.
Once the global recession starts to wind down, demand for oil will increase and go beyond normal levels, and we'll see a huge increase in use and prices. Those investing in the oil industry and oil companies will profit tremendously, as it's discovered that oil resources aren't diminishing at all, but are available in huge quantities. As oil engineers solve some of the cost problems related to extracting oil of shale, along with doing it more efficiently, we'll see this story unfold in the years ahead, as the media, politicians and radical environmentals won't be able to hide it.
Short term we already have the existing contango or super contango condition that allows a safe and guaranteed source of profit via taking arbitrage positions, and as that winds down, we should see oil prices start to gradually rise again. It's only a matter of when the economy turns around; that's what we need to be looking at and measuring our decisions of when to invest in oil by.
So whether it's oil drilling companies, natural gas companies, or oil and gas companies within the oil and gas industry, the future is bright for all aspects of the energy sector. Those investing in oil or gas in the short and long term will find themselves very happy with the profits they take away from it.
Even though oil and gas companies will have some short term difficulty and challenges, as the economic circumstances continue to gradually improve, people will start driving, flying and traveling again, and we'll see oil demand and oil prices start to increase again.
Oil news has been somewhat grim, but again, crude oil isn't going to drop in need or use anytime soon, and even though mainstream media outlets love to make big oil companies look like villains, they will continue to be profitable far into the future because of the demand for it will not stop any time soon.
Many people that in reality oppose the use of oil for a variety of stupid reasons, like to try to make the argument that we've reached the point where oil has peaked, or peak oil, so that we much waste billions of dollars in order to save humanity as fuel resources dry up. This is nothing else but a lie, and the use of fear as a tool to take taxpayers dollars and waste them on things like ethanol, which has turned into a disastrous debacle and the source of an endless number of engine breakdowns, especially among small engines. Creating an atmosphere of torment and fear has ended with idiotic waste of time and money, when in reality there are billions of barrels of oil on U.S. land and off it's shorelines. Only the hateful environmentalists and their private agendas generate the type of publicity that makes this typeo of scenario possible, as the thought of drilling into their mother earth is atrocious to these earth worshippers, as they are offended by humans existing, but god help you if you drill into their "mother."
That's my little rant. Now the reality. Just in the rock shale of the United States alone, it is estimated there is far more available proven oil reserves than exists in Saudi Arabia. This is trying to be covered up so Americans don't call the government and radical environmentalists to account for their crimes against humanity by not only lying, but covering up the fact that there is that much oil available for use. This doesn't even take into account the oil off our shorelines or in Alaska. Go beyond that and we have the new methods that can see hidden oil underneath the salt of the oceans, and where Brazil's Petrobras has uncovered billions more in oil fields beneath the ocean floor, and they're just getting started. Add the huge amount in the Canadian oil sands and you get the idea. The idea of peak oil is a joke at this time, and will be for many decades into the future. Those opposing oil and gas companies have been hiding the fact of how much oil is available so they can create a panic in order to get access for their pet projects in relationship to alternative energy. A growing number of those in the energy business are doing the same as tax credits and other incentives "blind" their eyes to the huge source of existing energy we still have.
So the oil and gas industry along with the oil and gas companies are in reality in a strong position in the long term, as oil and gas will flow through the pipelines for decades and decades into the future, which will not only provide many oil and gas jobs, but keep things running while we lose the emotional baggage and slowly look at realistic and legitimate sources of alternative energy going forward. There's absolutely no lack of oil and gas we can drill for and produce at this time, and there is no need to create the false sense of urgency the media has been doing through its going to bed with environmentalists.
Oil exploration needs to continually be encouraged, as well as removing barriers to oil well drilling. Oil development will continue to be a huge business in the world, and the resources out there are still staggering, as far as the amount of oil and gas still out there to be extracted from the earth and underneath the oceans.
Where does all of this leave oil and gas as an investment? It will be a very strong and profitable place to put our money, both over the short and long term.
Once the global recession starts to wind down, demand for oil will increase and go beyond normal levels, and we'll see a huge increase in use and prices. Those investing in the oil industry and oil companies will profit tremendously, as it's discovered that oil resources aren't diminishing at all, but are available in huge quantities. As oil engineers solve some of the cost problems related to extracting oil of shale, along with doing it more efficiently, we'll see this story unfold in the years ahead, as the media, politicians and radical environmentals won't be able to hide it.
Short term we already have the existing contango or super contango condition that allows a safe and guaranteed source of profit via taking arbitrage positions, and as that winds down, we should see oil prices start to gradually rise again. It's only a matter of when the economy turns around; that's what we need to be looking at and measuring our decisions of when to invest in oil by.
So whether it's oil drilling companies, natural gas companies, or oil and gas companies within the oil and gas industry, the future is bright for all aspects of the energy sector. Those investing in oil or gas in the short and long term will find themselves very happy with the profits they take away from it.
Friday, February 6, 2009
Oil | Contango Continues Supertanker Storage
The super contango arbitrage remains in play for investors as oil continues to be stored on supertankers in anticipation of prices rising.
Oil companies are still building up vast floating reserves of unsold crude oil on supertankers at sea because oil for immediate delivery is much cheaper than futures prices, traders and shipping brokers said on Friday.
The stockpile, mostly on Very Large Crude Carriers (VLCCs) in the North Sea, U.S. Gulf, in the Mediterranean and off the coast of West Africa, is now so large that it probably exceeds 80 million barrels -- about equivalent to a day's global oil consumption, brokers say.
Despite the recent sale of a handful of cargoes of North Sea crude from a supertanker at Scapa Flow in Scotland's Orkney Islands last week, the economics still make a compelling argument for buying oil now, putting it in a ship and selling it in a few months' time, traders say.
Much of the oil is North Sea crude such as Forties and Brent, but it also includes Russian Urals crude, West African and other grades.
Margins can be locked in at the time of purchase through a series of time spreads or contracts for differences as well as trades on London's ICE futures market.
"The amount of oil stored at sea is increasing steadily and will keep increasing until the numbers no longer make sense," said Simon Wardell, oil analyst at Global Insight in London.
Deepening global recession has dragged oil prices down more than 70 percent since they hit a record high of almost $150 a barrel last July, but oil futures prices are much higher, more than paying for storage and other costs such as financing.
CONTANGO
This discount for North Sea oil now below oil for the future, known as a contango, has been as wide as $8 over the last two months and much of the oil now stored at sea was put afloat in December.
Last week, the trading arm of Royal Dutch Shell (RDSa.L) sold three cargoes of North Sea Forties crude by transshipment, prompting talk that the storage trade might be coming to an end.
The contango had flattened out, allowing Shell and some other companies that had stored oil to cash in and make a profit.
But the discount for prompt oil has deepened again over the last week, partly perhaps because of the release of some of oil from storage, and traders have again started booking vessels on long-term contracts with storage options, shipping brokers say.
BP Plc (BP.L), U.S. oil company Koch and independent Swiss-based trader Gunvor have all been in the market for, or taken options on, VLCCs with flexible, long-term storage options in the last few days, brokers say.
"There is no doubt that the contango play works again," said one oil broker, who declined to be identified. "The margin is there and is being filled."
By early Friday, there was a spread between light, sweet physical North Sea crude for delivery next week and June Brent futures LCOc1 of around $6.75, and closer to $8 against July futures.
Assuming rental rates for a 2.4 million-barrel VLCC of around $60,000 per day, that would put the cost of oil storage at around 75 cents per barrel per month, well inside the time spread even with hefty financing costs.
Many traders now storing oil believe the market for prompt oil will begin to strengthen over the next month or so as promised cuts in production by members of the Organization of the Petroleum Exporting Countries begin to tighten supply.
The onset of the northern hemisphere summer could also spur an increase in demand for gasoline in the United States.
But analysts suggest the sheer size of the floating stockpile represents a threat to any quick recovery in oil prices. The oil will be released on to the market as prices recover, helping to slow or at least dampen any recovery.
"At some point all this oil will come flooding back into the market once the prompt price comes up against the futures," said Wardell. "That is likely to depress prices again."
The super contango arbitrage play is one of the few sureties for investors, and well worth investing in to assure profits.
Oil companies are still building up vast floating reserves of unsold crude oil on supertankers at sea because oil for immediate delivery is much cheaper than futures prices, traders and shipping brokers said on Friday.
The stockpile, mostly on Very Large Crude Carriers (VLCCs) in the North Sea, U.S. Gulf, in the Mediterranean and off the coast of West Africa, is now so large that it probably exceeds 80 million barrels -- about equivalent to a day's global oil consumption, brokers say.
Despite the recent sale of a handful of cargoes of North Sea crude from a supertanker at Scapa Flow in Scotland's Orkney Islands last week, the economics still make a compelling argument for buying oil now, putting it in a ship and selling it in a few months' time, traders say.
Much of the oil is North Sea crude such as Forties and Brent, but it also includes Russian Urals crude, West African and other grades.
Margins can be locked in at the time of purchase through a series of time spreads or contracts for differences as well as trades on London's ICE futures market.
"The amount of oil stored at sea is increasing steadily and will keep increasing until the numbers no longer make sense," said Simon Wardell, oil analyst at Global Insight in London.
Deepening global recession has dragged oil prices down more than 70 percent since they hit a record high of almost $150 a barrel last July, but oil futures prices are much higher, more than paying for storage and other costs such as financing.
CONTANGO
This discount for North Sea oil now below oil for the future, known as a contango, has been as wide as $8 over the last two months and much of the oil now stored at sea was put afloat in December.
Last week, the trading arm of Royal Dutch Shell (RDSa.L) sold three cargoes of North Sea Forties crude by transshipment, prompting talk that the storage trade might be coming to an end.
The contango had flattened out, allowing Shell and some other companies that had stored oil to cash in and make a profit.
But the discount for prompt oil has deepened again over the last week, partly perhaps because of the release of some of oil from storage, and traders have again started booking vessels on long-term contracts with storage options, shipping brokers say.
BP Plc (BP.L), U.S. oil company Koch and independent Swiss-based trader Gunvor have all been in the market for, or taken options on, VLCCs with flexible, long-term storage options in the last few days, brokers say.
"There is no doubt that the contango play works again," said one oil broker, who declined to be identified. "The margin is there and is being filled."
By early Friday, there was a spread between light, sweet physical North Sea crude for delivery next week and June Brent futures LCOc1 of around $6.75, and closer to $8 against July futures.
Assuming rental rates for a 2.4 million-barrel VLCC of around $60,000 per day, that would put the cost of oil storage at around 75 cents per barrel per month, well inside the time spread even with hefty financing costs.
Many traders now storing oil believe the market for prompt oil will begin to strengthen over the next month or so as promised cuts in production by members of the Organization of the Petroleum Exporting Countries begin to tighten supply.
The onset of the northern hemisphere summer could also spur an increase in demand for gasoline in the United States.
But analysts suggest the sheer size of the floating stockpile represents a threat to any quick recovery in oil prices. The oil will be released on to the market as prices recover, helping to slow or at least dampen any recovery.
"At some point all this oil will come flooding back into the market once the prompt price comes up against the futures," said Wardell. "That is likely to depress prices again."
The super contango arbitrage play is one of the few sureties for investors, and well worth investing in to assure profits.
Oil | Forty Dollars the Low for oil?
Now that oil futures prices have traded above the $40 mark for a couple weeks, some are concluding that the bottom may have finally been reached for the black gold.
After hitting a four-year low of $32.40 a barrel on Dec. 19, oil has now rebounded more than 20%. While occasionally falling below $40 in intraday trading, it has closed above $40 everyday since Jan. 20. Similarly, national average gasoline prices have risen above $1.90 a gallon from below $1.70 a month ago.
"While crude-oil markets may remain vulnerable to further disappointments in [...] economic conditions, there is also the potential for a price base to be forming," wrote Brenda Sullivan, an analyst at Sucden Financial Research, in a note.
Ultimately, analysts say the future direction of oil prices will depend on the outcome of the struggle of two opposing forces.
On the one hand, the weakening global economy is expected to lead demand for oil to fall for a second year, marking the first two-straight-year decline in decades. On the other hand, the Organization of Petroleum Exporting Countries is expected to continue cutting production at a record pace to put a floor under prices.
High stakes
The stakes are high for investors who are bullish on oil, especially those who've poured record amounts into oil exchange-traded funds.
Data showed investment in oil ETFs, a convenient investment channel for retail investors, has reached record levels. The number of crude futures contracts held by the United States Oil Fund (USO) , the largest oil ETF, hit a record high near 80,000 recently. One contract represents 1,000 barrels of oil.
Last year, the commodity proved one of the best ways to earn a lot of money - and then, to lose it all. After hitting a record high of $147 a barrel in July, oil fell more than $100, or 70% by year-end. It closed 2008 down 54%, its biggest loss ever and more than the stock market's tumble.
Trading in the first months of this year also didn't bode well for oil bulls. Crude has lost 10% so far this year, compared with a 5% loss in the Reuters/Jefferies CRB commodities index, and a 4% gain in gold prices.
On Friday, oil fell 2% to near $40 a barrel on the New York Mercantile Exchange after the U.S. reported a 16-year high unemployment rate. See Futures Movers.
Some analysts predict oil prices could fall to as low as $25 in the second quarter. The inflation-adjusted record low for Nymex oil is at $18.90 a barrel, hit on April 1, 1986. In non-adjusted dollar terms, that low was $9.75, the only time in Nymex history that oil fell below $10.
OPEC cuts production
Investors aren't the only ones wanted oil prices to stabilize. The 12 OPEC member countries, whose revenues heavily depend on oil prices, have made record cuts in their production.
Some of the members of OPEC said they want to see oil prices rise to at least $60 a barrel.
At its December meeting, OPEC agreed to reduce production by a record amount of 2.2 million barrels a day, starting from Jan. 1, adding to previous cuts of 2 million barrels. Overall, the reduction is equal to about 5% of the world's oil demand, which should easily offset any drop in demand, analysts believe.
Most energy agencies, including the U.S. Energy Information Administration and the International Energy Agency, predict world oil demand will fall by 1% to 2% this year, following a similar decline in 2008.
Chakib Khelil, Algeria's energy minister, said Tuesday there was a 50% chance of another supply cut during OPEC's next meeting on March 15, according to media reports.
But OPEC members, who control more than one third of the world's oil production, have a sketchy record of implementing production cuts.
Oil could rise if OPEC cuts production, said Phil Flynn, vice president at Alaron Trading. "But the problem is the compliance."
OPEC in January met only two-thirds of its pledge to lower oil output, as several members continued to pump above target levels, a Reuters survey showed on Tuesday.
While Saudi Arabia and the United Arab Emirates lowered their production below or close to their targets, some other countries, such as Venezuela and Iran, have pumped more oil than their allowed quotas, the survey found.
Economic rebound?
Investors are also hoping demand will rebound once the economy is revived. With governments worldwide adopting stimulus packages, some economists believe the economy could bottom out in the second half of the year.
The Federal Reserve said late January the economy was in worse shape than it was in December, but a "gradual recovery [...] will begin later this year."
And in its January monthly report, the Energy Department's EIA said that after two years' decline, world oil consumption is expected to record a modest rebound in 2010,.
Such forecasts have already encouraged oil investors to build up their positions, even before prices start rising.
"We are in a world of increasing demand and decreasing supply for tangible things, especially energy," said Steven Podnos, a financial advisor at Wealth Care LLC. "Oil represents an attractive investment sector."
But for now, the oil market is still plagued by weak demand and lofty inventories. The EIA reported Wednesday that crude inventories in the U.S., the world's biggest oil consumer, rose for a sixth straight week to 346.1 million barrels, the highest level in 18 months.
Meanwhile, inventories at Cushing, Okla., the delivery point for Nymex crude futures, have reached a new record high of 34.3 million barrels.
Global demand is poised to post the largest contraction this year since 1982, analysts at Morgan Stanley said in a recent report.
"Supply constraints will remain a longer-term issue and will be intensified by the current bout of weaker prices," the Morgan Stanley analysts said. But "the magnitude of demand weakness will leave this constraint a non-issue in 2009."
They expect oil prices to average $35 barrels in 2009 and fall to a low of $25 in the second quarter.
The EIA, meanwhile, said in its January report, it expects oil prices to average $43 per barrel in 2009 and $55 in 2010.
While oil prices should rise this year, it'll be interesting to see if we've really hit an oil futures low, or it takes more time to work out depending on consumer demand connected to the economic crisis.
After hitting a four-year low of $32.40 a barrel on Dec. 19, oil has now rebounded more than 20%. While occasionally falling below $40 in intraday trading, it has closed above $40 everyday since Jan. 20. Similarly, national average gasoline prices have risen above $1.90 a gallon from below $1.70 a month ago.
"While crude-oil markets may remain vulnerable to further disappointments in [...] economic conditions, there is also the potential for a price base to be forming," wrote Brenda Sullivan, an analyst at Sucden Financial Research, in a note.
Ultimately, analysts say the future direction of oil prices will depend on the outcome of the struggle of two opposing forces.
On the one hand, the weakening global economy is expected to lead demand for oil to fall for a second year, marking the first two-straight-year decline in decades. On the other hand, the Organization of Petroleum Exporting Countries is expected to continue cutting production at a record pace to put a floor under prices.
High stakes
The stakes are high for investors who are bullish on oil, especially those who've poured record amounts into oil exchange-traded funds.
Data showed investment in oil ETFs, a convenient investment channel for retail investors, has reached record levels. The number of crude futures contracts held by the United States Oil Fund (USO) , the largest oil ETF, hit a record high near 80,000 recently. One contract represents 1,000 barrels of oil.
Last year, the commodity proved one of the best ways to earn a lot of money - and then, to lose it all. After hitting a record high of $147 a barrel in July, oil fell more than $100, or 70% by year-end. It closed 2008 down 54%, its biggest loss ever and more than the stock market's tumble.
Trading in the first months of this year also didn't bode well for oil bulls. Crude has lost 10% so far this year, compared with a 5% loss in the Reuters/Jefferies CRB commodities index, and a 4% gain in gold prices.
On Friday, oil fell 2% to near $40 a barrel on the New York Mercantile Exchange after the U.S. reported a 16-year high unemployment rate. See Futures Movers.
Some analysts predict oil prices could fall to as low as $25 in the second quarter. The inflation-adjusted record low for Nymex oil is at $18.90 a barrel, hit on April 1, 1986. In non-adjusted dollar terms, that low was $9.75, the only time in Nymex history that oil fell below $10.
OPEC cuts production
Investors aren't the only ones wanted oil prices to stabilize. The 12 OPEC member countries, whose revenues heavily depend on oil prices, have made record cuts in their production.
Some of the members of OPEC said they want to see oil prices rise to at least $60 a barrel.
At its December meeting, OPEC agreed to reduce production by a record amount of 2.2 million barrels a day, starting from Jan. 1, adding to previous cuts of 2 million barrels. Overall, the reduction is equal to about 5% of the world's oil demand, which should easily offset any drop in demand, analysts believe.
Most energy agencies, including the U.S. Energy Information Administration and the International Energy Agency, predict world oil demand will fall by 1% to 2% this year, following a similar decline in 2008.
Chakib Khelil, Algeria's energy minister, said Tuesday there was a 50% chance of another supply cut during OPEC's next meeting on March 15, according to media reports.
But OPEC members, who control more than one third of the world's oil production, have a sketchy record of implementing production cuts.
Oil could rise if OPEC cuts production, said Phil Flynn, vice president at Alaron Trading. "But the problem is the compliance."
OPEC in January met only two-thirds of its pledge to lower oil output, as several members continued to pump above target levels, a Reuters survey showed on Tuesday.
While Saudi Arabia and the United Arab Emirates lowered their production below or close to their targets, some other countries, such as Venezuela and Iran, have pumped more oil than their allowed quotas, the survey found.
Economic rebound?
Investors are also hoping demand will rebound once the economy is revived. With governments worldwide adopting stimulus packages, some economists believe the economy could bottom out in the second half of the year.
The Federal Reserve said late January the economy was in worse shape than it was in December, but a "gradual recovery [...] will begin later this year."
And in its January monthly report, the Energy Department's EIA said that after two years' decline, world oil consumption is expected to record a modest rebound in 2010,.
Such forecasts have already encouraged oil investors to build up their positions, even before prices start rising.
"We are in a world of increasing demand and decreasing supply for tangible things, especially energy," said Steven Podnos, a financial advisor at Wealth Care LLC. "Oil represents an attractive investment sector."
But for now, the oil market is still plagued by weak demand and lofty inventories. The EIA reported Wednesday that crude inventories in the U.S., the world's biggest oil consumer, rose for a sixth straight week to 346.1 million barrels, the highest level in 18 months.
Meanwhile, inventories at Cushing, Okla., the delivery point for Nymex crude futures, have reached a new record high of 34.3 million barrels.
Global demand is poised to post the largest contraction this year since 1982, analysts at Morgan Stanley said in a recent report.
"Supply constraints will remain a longer-term issue and will be intensified by the current bout of weaker prices," the Morgan Stanley analysts said. But "the magnitude of demand weakness will leave this constraint a non-issue in 2009."
They expect oil prices to average $35 barrels in 2009 and fall to a low of $25 in the second quarter.
The EIA, meanwhile, said in its January report, it expects oil prices to average $43 per barrel in 2009 and $55 in 2010.
While oil prices should rise this year, it'll be interesting to see if we've really hit an oil futures low, or it takes more time to work out depending on consumer demand connected to the economic crisis.
Tuesday, February 3, 2009
Oil Refinery Workers New Labor Contract
Union negotiators for oil refinery workers have tentatively agreed to a new contract which represents approximately 24,000 union members.
The new contract deals with labor issues like wage and benefit levels, which the details of the agreement weren't released.
If there had been a strike, it would have affected up to 10 percent of the overall refining capacity in America's oil industry. Other reports say the strike could have affected close to two-thirds of the capacity to make fuels in general, gasoline and diesel.
Details of the oil refinery workers deal will be released sometime on Wednesday by their representatives of the United Steelworkers union. Signing off on the deal was the National Oil Policy Committee, which still has to be ratified by local union units.
Some of the large oil and gas companies that would have been affected by the strike were Exxon Mobil (nyse:XOM), Royal Dutch Shell (nyse: RDSA), BP (nyse:BP) PLC, Valero (nyse:VLO), and Chevron (nyse:CVX), of close to 60 oil producers in general.
Besides higher wages, other issues being negotiated for the oil refinery workers were cost-of-living increases and full benefits for medical, dental and vision; both for current and retired oil workers.
The deal was worked out with Shell Oil, which will also be extended to the other plants, including Valero Energy Corp., Exxon Mobil Corp., Chevron and BP Plc. The deal, if approved, will keep up to six refinery plants from closing, and about 1.7 barrels a day from going off line.
Some of the known parts of the contract are a three percent raise for each of the three years of the contract, along with a signing bonus of $2,500 if it is approved before February 16.
Fuel and oil demand has fallen so much that the refineries have slowed production after falling prices put downward pressure on margins. Oil processors have had a record number of days of making gasoline at a loss, measured by futures prices.
The two largest refiners in America, ConocoPhillips and Valero were leading the fuel production cut in oil refinery output.
Gas prices had surged by 10 percent last week as the possibility of a strike loomed over the oil and oil refinery industry.
On the New York Mercantile Exchange, gasoline for March delivery increased 1.68 cents to $1.166 a gallon. Gas prices across the nation grew to $1.89 a gallon according to AAA.
Now that a strike is probably averted, we should see a corresponding fall in gasoline prices as demand continues to fall.
If things do change economically, this new contract could be a diaster for union members, as higher operating costs through increased wages and benefits could put many oil refinery workers out of a job in the months ahead. But that's how unions always work, as they overreach and cause loss of jobs, while benefitting only some of the members.
For the week ending January 16, oil refinery production had operated at 82.5 percent of capacity, down significantly from the 85.2 percent the week before. It'll a long time before gas and oil demand increase in any major way.
Motorists in the U.S. continue to drive much less, as for the second year they've driven at a lower rate than the previous year. According to the Federal Highway Administration, vehicle miles have plunged by 5.3 percent or 12.9 billion miles. We should see that continue on, and oil refineries operating at even less capacity before it turns around.
The new contract deals with labor issues like wage and benefit levels, which the details of the agreement weren't released.
If there had been a strike, it would have affected up to 10 percent of the overall refining capacity in America's oil industry. Other reports say the strike could have affected close to two-thirds of the capacity to make fuels in general, gasoline and diesel.
Details of the oil refinery workers deal will be released sometime on Wednesday by their representatives of the United Steelworkers union. Signing off on the deal was the National Oil Policy Committee, which still has to be ratified by local union units.
Some of the large oil and gas companies that would have been affected by the strike were Exxon Mobil (nyse:XOM), Royal Dutch Shell (nyse: RDSA), BP (nyse:BP) PLC, Valero (nyse:VLO), and Chevron (nyse:CVX), of close to 60 oil producers in general.
Besides higher wages, other issues being negotiated for the oil refinery workers were cost-of-living increases and full benefits for medical, dental and vision; both for current and retired oil workers.
The deal was worked out with Shell Oil, which will also be extended to the other plants, including Valero Energy Corp., Exxon Mobil Corp., Chevron and BP Plc. The deal, if approved, will keep up to six refinery plants from closing, and about 1.7 barrels a day from going off line.
Some of the known parts of the contract are a three percent raise for each of the three years of the contract, along with a signing bonus of $2,500 if it is approved before February 16.
Fuel and oil demand has fallen so much that the refineries have slowed production after falling prices put downward pressure on margins. Oil processors have had a record number of days of making gasoline at a loss, measured by futures prices.
The two largest refiners in America, ConocoPhillips and Valero were leading the fuel production cut in oil refinery output.
Gas prices had surged by 10 percent last week as the possibility of a strike loomed over the oil and oil refinery industry.
On the New York Mercantile Exchange, gasoline for March delivery increased 1.68 cents to $1.166 a gallon. Gas prices across the nation grew to $1.89 a gallon according to AAA.
Now that a strike is probably averted, we should see a corresponding fall in gasoline prices as demand continues to fall.
If things do change economically, this new contract could be a diaster for union members, as higher operating costs through increased wages and benefits could put many oil refinery workers out of a job in the months ahead. But that's how unions always work, as they overreach and cause loss of jobs, while benefitting only some of the members.
For the week ending January 16, oil refinery production had operated at 82.5 percent of capacity, down significantly from the 85.2 percent the week before. It'll a long time before gas and oil demand increase in any major way.
Motorists in the U.S. continue to drive much less, as for the second year they've driven at a lower rate than the previous year. According to the Federal Highway Administration, vehicle miles have plunged by 5.3 percent or 12.9 billion miles. We should see that continue on, and oil refineries operating at even less capacity before it turns around.
Tuesday, January 27, 2009
Oil | Gasprom, Statoil, Petrobras
What to the names Gasprom, Statoil and Petrobras have in common? They're all state-owned oil and natural gas energy companies that have a lot of upside potential for oil investors.
When you consider the national monopolies represented by state-owned oil & gas companies, you realize the great potential an energy investor has, assuming they do their homework, as not all nationalized oil companies are the same. Take Mexico and Venezuela, who run their oil exploration companies horribly, and you'd have to have oil in your veins to invest in them.
But in some cases, the competitive advantage for a well run national oil company offers great opportunity.
Take Petrobras of Brazil for a moment. They discovered huge offshore oil fields over the last couple years, and the government offered the prime drilling locations to who? You got it: Petrobras. If any other oil companies are allowed in, you know all they'll get is the leftovers.
Now Statoil, or StoilHydro, from Norway, is in a similar situation, and are positioned for some good profits going forword.
As far as Russian oil company Gazprom, which also has a presence in the UK, they are obviously a much more risky investment, but worthwhile testing out with your spare change rather than serious energy investment money. The Gazprom news is a little more volatile than the oil news concerning other energy companies owned by governments.
Now that the idea is being floated around out there that all the easy oil has been accessed (it hasn't but that's a different story), these national oil and natural gas exploration companies should receive a lot of positive attention from news outlets as the idea of scarcity and higher prices woo oil investors.
We're going to see more oil rigs offshore, and those will be installed by companies like statoil, Petrobras and Gazprom.
Many energy investors don't realize the size of some of the state oil companies even when compared to huge oil and gas firms like Exxon Mobile. Exxon Mobile doesn't have anywhere near the oil and gas capacity that these state oil & gas companies have, and they have to pay taxes, contrary to the national oil and gas companies.
Where does that leave us? It leaves us with huge companies that own a monopoly exploring and drilling a natural resource that will be needed for decades and decades ahead.
Those energy companies owned run by those countries operationally sound way, will bring good returns for investors for years to come. Just think of the country producing the oil and gas to see what the risks are. As risky as the country is in other areas, will be the risk involved for investors in oil and gas.
New techniques used allow oil & gas exploration companies to see through the salty ocean bottoms to find new energy reserves. That is what allowed Petrobras to discover the Tupi and other oil fields which had been there all along.
Depending on what your energy investment strategy is and your personal risk disposition, national companies like Gazprom, Statoil and Petrobras could be places you put your dollars for the long haul.
When you consider the national monopolies represented by state-owned oil & gas companies, you realize the great potential an energy investor has, assuming they do their homework, as not all nationalized oil companies are the same. Take Mexico and Venezuela, who run their oil exploration companies horribly, and you'd have to have oil in your veins to invest in them.
But in some cases, the competitive advantage for a well run national oil company offers great opportunity.
Take Petrobras of Brazil for a moment. They discovered huge offshore oil fields over the last couple years, and the government offered the prime drilling locations to who? You got it: Petrobras. If any other oil companies are allowed in, you know all they'll get is the leftovers.
Now Statoil, or StoilHydro, from Norway, is in a similar situation, and are positioned for some good profits going forword.
As far as Russian oil company Gazprom, which also has a presence in the UK, they are obviously a much more risky investment, but worthwhile testing out with your spare change rather than serious energy investment money. The Gazprom news is a little more volatile than the oil news concerning other energy companies owned by governments.
Now that the idea is being floated around out there that all the easy oil has been accessed (it hasn't but that's a different story), these national oil and natural gas exploration companies should receive a lot of positive attention from news outlets as the idea of scarcity and higher prices woo oil investors.
We're going to see more oil rigs offshore, and those will be installed by companies like statoil, Petrobras and Gazprom.
Many energy investors don't realize the size of some of the state oil companies even when compared to huge oil and gas firms like Exxon Mobile. Exxon Mobile doesn't have anywhere near the oil and gas capacity that these state oil & gas companies have, and they have to pay taxes, contrary to the national oil and gas companies.
Where does that leave us? It leaves us with huge companies that own a monopoly exploring and drilling a natural resource that will be needed for decades and decades ahead.
Those energy companies owned run by those countries operationally sound way, will bring good returns for investors for years to come. Just think of the country producing the oil and gas to see what the risks are. As risky as the country is in other areas, will be the risk involved for investors in oil and gas.
New techniques used allow oil & gas exploration companies to see through the salty ocean bottoms to find new energy reserves. That is what allowed Petrobras to discover the Tupi and other oil fields which had been there all along.
Depending on what your energy investment strategy is and your personal risk disposition, national companies like Gazprom, Statoil and Petrobras could be places you put your dollars for the long haul.
Sunday, January 25, 2009
Oil: OPEC Production Cuts
OPEC countries are under increasing pressure to cut oil production as oil prices aren't able to prop up the many countries so reliant on higher prices to take care of their needs.
It's not a stretch to say the leaders of oil producing countries will have their hands full as people start to get edgy over consequences of low prices.
In reality, there's not much OPEC and other oil producing countries can do about it, as the economic crisis has lowered demand for oil, and no matter how far oil production is cut, it's not going to get people to spend their money on gas they're not going to use.
Cutting oil production will only cause people to travel even less, undercutting the very strategy attempted by countries to prop up their crude prices.
If oil prices rise than there will be a high cost of oil that will sit there not being used, as people continue to save rather than spend their money.
Oil storage and reserves are growing while consumers hold back from buying, that isn't going to change for OPEC or oil companies. The oil industry can cut production, and it has already, but that won't solve the problem the market has already decided.
All that corporations and countries should do is get out of the way and let the market figure it out. Intervention into the oil market will cause unintended consequences as government interference always does, and only prolong the economic pain for everyone.
There is nothing driving the oil markets, prices, supply, costs, drilling and production other than consumer demand. Nothing can be done to change that until the economic crisis ends and then money flowing back into consumer goods and services.
The oil industry can only stand by and watch, cut cost, get leaner, and prepare for when the turnaround in the oil market comes.
This will be essential for the industry, as once demand rises, there will probably be a huge surge in buying as pent up demand explodes. Oil companies and refineries need to be ready for that time, as they'll soon forget the bad oil news of today and their profits will again surge ahead.
Oil exploration is another important factor in the mix, as there is plenty of oil out there, and the demand will come back stronger than ever as America, China and other nations will return to their insatiable appetites for oil that they had in the recent past.
So OPEC and oil companies just need to relax a bit. Yes there's problems related to low oil prices, but forcing the issue in attempts to artificially raise the price of oil above market levels never works.
We just have to wait out the tough times and wait for oil demand to rebound.
It's not a stretch to say the leaders of oil producing countries will have their hands full as people start to get edgy over consequences of low prices.
In reality, there's not much OPEC and other oil producing countries can do about it, as the economic crisis has lowered demand for oil, and no matter how far oil production is cut, it's not going to get people to spend their money on gas they're not going to use.
Cutting oil production will only cause people to travel even less, undercutting the very strategy attempted by countries to prop up their crude prices.
If oil prices rise than there will be a high cost of oil that will sit there not being used, as people continue to save rather than spend their money.
Oil storage and reserves are growing while consumers hold back from buying, that isn't going to change for OPEC or oil companies. The oil industry can cut production, and it has already, but that won't solve the problem the market has already decided.
All that corporations and countries should do is get out of the way and let the market figure it out. Intervention into the oil market will cause unintended consequences as government interference always does, and only prolong the economic pain for everyone.
There is nothing driving the oil markets, prices, supply, costs, drilling and production other than consumer demand. Nothing can be done to change that until the economic crisis ends and then money flowing back into consumer goods and services.
The oil industry can only stand by and watch, cut cost, get leaner, and prepare for when the turnaround in the oil market comes.
This will be essential for the industry, as once demand rises, there will probably be a huge surge in buying as pent up demand explodes. Oil companies and refineries need to be ready for that time, as they'll soon forget the bad oil news of today and their profits will again surge ahead.
Oil exploration is another important factor in the mix, as there is plenty of oil out there, and the demand will come back stronger than ever as America, China and other nations will return to their insatiable appetites for oil that they had in the recent past.
So OPEC and oil companies just need to relax a bit. Yes there's problems related to low oil prices, but forcing the issue in attempts to artificially raise the price of oil above market levels never works.
We just have to wait out the tough times and wait for oil demand to rebound.
Tuesday, January 20, 2009
Marathon Oil Corp. | Gas Production 4th Quarter Down
Marathon Oil Corp. said Tuesday its oil and natural gas production in the fourth quarter was likely at the low end of its previous guidance range, in part from pipeline issues overseas and continued disruptions linked to last summer's hurricanes in the Gulf of Mexico.
The Houston-based company estimated its liquid hydrocarbon and natural gas production available for sale during October-December period was around 401,000 barrels of oil equivalent a day, at the bottom of a previous forecast between 400,000 and 440,000 barrels of oil equivalent a day.Marathon provided an overview of market conditions for the October-December period as all major oil companies prepare to report earnings for the fourth quarter.After peaking above $147 a barrel in July, oil prices spent the remainder of 2008 falling fast. When the fourth quarter began Oct. 1, crude was trading at around $100 a barrel. Three months later, on Dec. 31, it settled at $44.60. [Read the full article]
Yesterday, Marathon Oil Corporation (MRO) provided a weaker-than-expected fourth quarter 2008 interim update (covering the first two months of the quarter). While weak commodity-price realizations were built into estimates and were expected to be the primary reason for negative comparisons with previous results, Marathon's results will also be affected by upstream production shortfalls. We expect that yesterday's guidance will prompt downward earnings revisions. The company reports fourth-quarter 2008 results on February 3, 2009. Marathon expects fourth-quarter production of oil and natural gas to average 415,000 oil-equivalent barrels per day (BOE/d), which is below the company's guidance for the quarter. Approximately two-thirds of Marathon's production comes from outside the U.S. [Read the full article]
TORONTO, ONTARIO--(MARKET WIRE)--Jan 14, 2009 -- InterOil Corporation (AMEX: IOC) today announced the appointment of Mr. Wayne Andrews as Vice President of Capital Markets. Mr. Andrews joins InterOil from Raymond James and Associates Inc., where he was Managing Director of Exploration & Production Equity Research. Focusing on the oil and natural gas industry, Wayne Andrews joined Raymond James in 1996 after spending three years as natural gas analyst at Schroder Wertheim. Prior to joining Schroder's he was the Vice President and Director of Research at John S. Herold Inc, a petroleum research and consulting firm. He also spent five years as a senior geophysicist
at Sun Company and Oryx Energy. Mr. Andrews has been recognized
in the Reuters Survey of the top analysts, the StartMine Top Analyst Survey and the Wall Street Journal Best on the Street Survey. Mr. [Read the full article]
SAN ANTONIO--(BUSINESS WIRE)--Tesoro Corporation (NYSE:TSO) announced today that it expects fourth quarter 2008 earnings per share in the range of $0.60 to $0.75 per share, which includes net one-time adjustments of approximately $(0.29) per share. The one-time adjustments, using a marginal tax rate of 38%, include a $(0.41) per share after-tax accrual for doubtful accounts receivable, partially offset by an accrual reversal of $0.12 per share after-tax following a reduction in estimated costs associated with asset retirement obligations. In the course of our review of accounts receivable, we identified one material account as to which collection in the ordinary course of business was deemed to be unlikely. [Read the full article]
About Financial News USA
Financial News USA is a Next Generation Financial Communications firm focused on the distribution of market moving news. Financial News USA has developed leading edge e-publishing tools including programming proprietary RSS feeds and enabling open source press release publishing across its network. Financial News USA has been aggressively expanding its news distribution network by targeting direct feeds to financial news and data providers such as FinancialContent, Yahoo (NASDAQ: YHOO), among others. Financial News USA offers a free news feed available online (www.financialnewsusa.com) to websites and financial services looking for content and for individual investors looking to stay informed on the financial markets. Financial News USA and its affiliates charge each client cash for news distribution and may take an equity position in the companies mentioned herein, please visit the disclaimer at www.financialnewsusa.com.
Financial News USA
Email: info@financialnewsusa.com
Conclusion:
Reasons 4th quarter gas production is down for Marathon Oil Corp. is largely due to ongoing disruptions from Gulf of Mexico hurricanes and overseas pipeline challenges.
The Houston-based company estimated its liquid hydrocarbon and natural gas production available for sale during October-December period was around 401,000 barrels of oil equivalent a day, at the bottom of a previous forecast between 400,000 and 440,000 barrels of oil equivalent a day.Marathon provided an overview of market conditions for the October-December period as all major oil companies prepare to report earnings for the fourth quarter.After peaking above $147 a barrel in July, oil prices spent the remainder of 2008 falling fast. When the fourth quarter began Oct. 1, crude was trading at around $100 a barrel. Three months later, on Dec. 31, it settled at $44.60. [Read the full article]
Yesterday, Marathon Oil Corporation (MRO) provided a weaker-than-expected fourth quarter 2008 interim update (covering the first two months of the quarter). While weak commodity-price realizations were built into estimates and were expected to be the primary reason for negative comparisons with previous results, Marathon's results will also be affected by upstream production shortfalls. We expect that yesterday's guidance will prompt downward earnings revisions. The company reports fourth-quarter 2008 results on February 3, 2009. Marathon expects fourth-quarter production of oil and natural gas to average 415,000 oil-equivalent barrels per day (BOE/d), which is below the company's guidance for the quarter. Approximately two-thirds of Marathon's production comes from outside the U.S. [Read the full article]
TORONTO, ONTARIO--(MARKET WIRE)--Jan 14, 2009 -- InterOil Corporation (AMEX: IOC) today announced the appointment of Mr. Wayne Andrews as Vice President of Capital Markets. Mr. Andrews joins InterOil from Raymond James and Associates Inc., where he was Managing Director of Exploration & Production Equity Research. Focusing on the oil and natural gas industry, Wayne Andrews joined Raymond James in 1996 after spending three years as natural gas analyst at Schroder Wertheim. Prior to joining Schroder's he was the Vice President and Director of Research at John S. Herold Inc, a petroleum research and consulting firm. He also spent five years as a senior geophysicist
at Sun Company and Oryx Energy. Mr. Andrews has been recognized
in the Reuters Survey of the top analysts, the StartMine Top Analyst Survey and the Wall Street Journal Best on the Street Survey. Mr. [Read the full article]
SAN ANTONIO--(BUSINESS WIRE)--Tesoro Corporation (NYSE:TSO) announced today that it expects fourth quarter 2008 earnings per share in the range of $0.60 to $0.75 per share, which includes net one-time adjustments of approximately $(0.29) per share. The one-time adjustments, using a marginal tax rate of 38%, include a $(0.41) per share after-tax accrual for doubtful accounts receivable, partially offset by an accrual reversal of $0.12 per share after-tax following a reduction in estimated costs associated with asset retirement obligations. In the course of our review of accounts receivable, we identified one material account as to which collection in the ordinary course of business was deemed to be unlikely. [Read the full article]
About Financial News USA
Financial News USA is a Next Generation Financial Communications firm focused on the distribution of market moving news. Financial News USA has developed leading edge e-publishing tools including programming proprietary RSS feeds and enabling open source press release publishing across its network. Financial News USA has been aggressively expanding its news distribution network by targeting direct feeds to financial news and data providers such as FinancialContent, Yahoo (NASDAQ: YHOO), among others. Financial News USA offers a free news feed available online (www.financialnewsusa.com) to websites and financial services looking for content and for individual investors looking to stay informed on the financial markets. Financial News USA and its affiliates charge each client cash for news distribution and may take an equity position in the companies mentioned herein, please visit the disclaimer at www.financialnewsusa.com.
Financial News USA
Email: info@financialnewsusa.com
Conclusion:
Reasons 4th quarter gas production is down for Marathon Oil Corp. is largely due to ongoing disruptions from Gulf of Mexico hurricanes and overseas pipeline challenges.
Friday, January 16, 2009
Petrobras Says Oil and Gas Production Up 4.3 Percent Over Last Year
The good news for Brazil's government-run company Petrobras (PZE), is overall its output increased by 4.3 percent in 2008 in contrast to output in 2007. The bad news is their international oil and gas production both fell.
Considering today's economic climate, it still isn't a bad performance.
On the domestic side, which is where the major production of the company comes from, oil and gas production grew to almost 2.2 million barrels a day, while overall production was 2.4 million barrels a day.
On the international side of things, gas fell by 8.3 percent to 17,063 cubic meters a day, while oil declined by 2 percent to 123,635 barrels a day.
Most of the international drop came from the hurrican season as well as some of the maturer oil fields fell in production.
Thursday, January 15, 2009
Sunoco to Release Fourth Quarter Earnings
PHILADELPHIA--(BUSINESS WIRE)-- Sunoco, Inc. (NYSE:SUN) said today that it will release earnings for the fourth quarter of 2008 on Wednesday evening, February 4, 2009. The Company will hold a conference call on Thursday, February 5, 2009 at 3:00 p.m. ET to discuss its fourth quarter results. Those wishing to listen can access the call through Sunoco's website at www.SunocoInc.com. A replay will be available beginning approximately two hours following the completion of the call. A number of presentation slides will accompany the audio portion of the call and will be available to be viewed and printed shortly before the call begins.
Individuals wishing to listen to the call on the Company's website will need Windows Media Player™, which can be downloaded free of charge from Microsoft or from Sunoco's Conference Call page. To view and print the slides, you will need Acrobat Reader™, which can be downloaded free of charge from Adobe or from Sunoco's Conference Call page.
Sunoco, Inc., headquartered in Philadelphia, PA, is a leading manufacturer and marketer of petroleum and petrochemical products. With 910,000 barrels per day of refining capacity, approximately 4,700 retail sites selling gasoline and convenience items, approximately 6,000 miles of crude oil and refined product owned and operated pipelines and 44 product terminals, Sunoco is one of the largest independent refiner-marketers in the United States. Sunoco is a significant manufacturer of petrochemicals with annual sales of approximately five billion pounds, largely chemical intermediates used to make fibers, plastics, film and resins. Utilizing a unique, patented technology, Sunoco's cokemaking facilities in the United States have the capacity to manufacture approximately 3.0 million tons annually of high-quality metallurgical-grade coke for use in the steel industry. Sunoco also is the operator of, and has an equity interest in, a 1.7 million tons-per-year cokemaking facility in Vitoria, Brazil.
Source: Sunoco, Inc.
Sunoco, Inc.
Thomas Golembeski (media)
215-977-6298
or
Tom Harr (investors)
215-977-6764
Individuals wishing to listen to the call on the Company's website will need Windows Media Player™, which can be downloaded free of charge from Microsoft or from Sunoco's Conference Call page. To view and print the slides, you will need Acrobat Reader™, which can be downloaded free of charge from Adobe or from Sunoco's Conference Call page.
Sunoco, Inc., headquartered in Philadelphia, PA, is a leading manufacturer and marketer of petroleum and petrochemical products. With 910,000 barrels per day of refining capacity, approximately 4,700 retail sites selling gasoline and convenience items, approximately 6,000 miles of crude oil and refined product owned and operated pipelines and 44 product terminals, Sunoco is one of the largest independent refiner-marketers in the United States. Sunoco is a significant manufacturer of petrochemicals with annual sales of approximately five billion pounds, largely chemical intermediates used to make fibers, plastics, film and resins. Utilizing a unique, patented technology, Sunoco's cokemaking facilities in the United States have the capacity to manufacture approximately 3.0 million tons annually of high-quality metallurgical-grade coke for use in the steel industry. Sunoco also is the operator of, and has an equity interest in, a 1.7 million tons-per-year cokemaking facility in Vitoria, Brazil.
Source: Sunoco, Inc.
Sunoco, Inc.
Thomas Golembeski (media)
215-977-6298
or
Tom Harr (investors)
215-977-6764
Advance notice of 4th quarter and full year 2008 results and interim dividend announcement
At 07.00 GMT (08.00 CET and 02.00 EST) on Thursday 29 January, 2009 Royal Dutch Shell plc will release its fourth quarter and full year results and fourth quarter interim dividend announcement for 2008.
Murphy Oil Schedules Earnings Conference Call
EL DORADO, Arkansas, January 7, 2009 – Murphy Oil Corporation (NYSE:MUR) has scheduled its conference call at 12:00 p.m. Central Time on Thursday, January 29 to review fourth quarter 2008 earnings, which will be announced Wednesday afternoon, January 28. ACT Teleconferencing is handling arrangements for the call. Interested parties may participate by dialing 1-800-240-2430 and referencing reservation number 11124677. The call will also be broadcast live over the internet and can be accessed through the Investor Relations section of Murphy Oil’s website at (http://www.murphyoilcorp.com/ir). All investors, analysts, media, employees and the general public are invited to participate.
Online replays of the call will be available through Murphy Oil’s website and a recording of the call will be available through Monday, February 2 by dialing 1-800-405-2236. Audio downloads will be available on the Murphy website through March 1 and via Thomson StreetEvents for their service subscribers.
For More Information
Dory Stiles
Investor/ Media Relations
P.O. Box 7000
El Dorado, AR 71731-7000
(870) 864-6496
Online replays of the call will be available through Murphy Oil’s website and a recording of the call will be available through Monday, February 2 by dialing 1-800-405-2236. Audio downloads will be available on the Murphy website through March 1 and via Thomson StreetEvents for their service subscribers.
For More Information
Dory Stiles
Investor/ Media Relations
P.O. Box 7000
El Dorado, AR 71731-7000
(870) 864-6496
Marathon Oil Corporation Provides Fourth Quarter 2008 Interim Update
HOUSTON, Jan. 13 /PRNewswire-FirstCall/ -- Marathon Oil Corporation (NYSE: MRO) today is providing information on market factors and operating conditions that occurred during the fourth quarter of 2008 that could impact the Company's quarterly financial results. The market indicators and Company estimates noted below and in the attached schedule may differ significantly from actual results. The Company will report fourth quarter results on Feb. 3, 2009, and will conduct a conference call and webcast that same day. Details of the earnings conference call and webcast are noted at the end of this release.
Exploration and Production
Liquid hydrocarbon and natural gas production sold during the fourth quarter is estimated to be approximately 415,000 barrels of oil equivalent per day (boepd). Revenues are reported based on production sold during the period which can vary from production available for sale primarily as a result of the timing of international crude oil liftings and natural gas sales. Liquid hydrocarbon and natural gas production available for sale during the fourth quarter is expected to be approximately 401,000 boepd, which is 3 percent higher than the third quarter 2008 result of 389,000 boepd. The available for sale estimate was at the bottom of the 400,000 to 440,000 boepd fourth quarter guidance due primarily to three major factors: longer than expected downtime at the offshore Equatorial Guinea Alba platform due to pipeline issues; lower than expected Gulf of Mexico production from continued impacts related to 2008 hurricanes; and, the Oct. 31, 2008 sale of Marathon's non-core interests in the Heimdal area offshore Norway.
As shown in the attached table, Marathon's average liquid hydrocarbon realization for the first two months of the fourth quarter, as compared to the third quarter of 2008, decreased $51.11 per barrel domestically and $49.80 per barrel internationally, reflecting the general market price movements during the first two months of the quarter. For the entire fourth quarter of 2008, the average West Texas Intermediate (WTI) crude oil market price indicator was $59.14 per barrel lower than the third quarter of 2008 while the average Dated Brent indicator decreased $59.61 per barrel.
Marathon's domestic average natural gas price realization for October and November decreased $3.11 per thousand cubic feet (mcf) from the Company's average realized price in the third quarter of 2008. The average Henry Hub (HH) prompt natural gas price for the fourth quarter decreased $2.75 per million British Thermal Units (BTUs), while the average HH bid week natural gas price decreased $3.30 per million BTUs during this same period. International average gas realizations decreased $0.05 per mcf in the first two months of the fourth quarter compared to the third quarter of 2008.
Marathon's actual crude oil and natural gas price realizations vary from market indicators primarily due to product quality and location differentials.
Fourth quarter 2008 exploration expense is now expected to be between $125 to $175 million, which is within previous guidance.
Oil Sands Mining
For the fourth quarter 2008, the Company estimates that its net share of bitumen production before royalties from the Athabasca Oil Sands Project (AOSP) mining operation will be approximately 25,000 barrels per day (bpd), which is within the previous guidance of 23,000 to 28,000 bpd for the fourth quarter. Marathon's synthetic crude oil sales from AOSP for fourth quarter 2008 are estimated to be approximately 32,000 bpd. Marathon's average synthetic crude oil realization (excluding derivative impacts) for the first two months of the fourth quarter, as compared to third quarter 2008, decreased $54.43 per barrel, reflecting the general market price movements during the first two months of the fourth quarter.
For the fourth quarter 2008, the Company expects a net after-tax gain of approximately $134 million on crude oil derivative instruments intended to mitigate price risk related to sales of synthetic crude oil, of which approximately $6 million is realized and approximately $128 million is unrealized mark-to-market. The last of these derivative instruments expire at year end 2009.
Refining, Marketing and Transportation
The Company estimates its refined products sales volume will average approximately 1,400,000 bpd in the fourth quarter of 2008 compared to 1,432,000 bpd in the fourth quarter of 2007.
The Company estimates its fourth quarter 2008 refining and wholesale marketing gross margin will be approximately $0.12 per gallon as compared to $0.048 per gallon earned in the fourth quarter 2007, with the falling crude oil prices during the fourth quarter 2008, compared to rising prices in the fourth quarter 2007, being the primary reason for this projected increase. Additionally, the gross margin includes an estimated gain on derivative instruments of approximately $64 million in the fourth quarter of 2008 compared to a loss of $427 million in the fourth quarter of 2007. This change was primarily due to the change in crude oil prices during the fourth quarter 2008 compared to the fourth quarter 2007 noted above, as well as the fact that the Company no longer uses derivatives to mitigate its domestic crude oil acquisition price risk. These favorable variances were partially offset by an unfavorable year-over-year quarterly impact from a narrowing in the average sweet/sour differential on the Company's cost of sour crude oil purchases. In addition, Marathon's ethanol blending margins are projected to be less favorable in the fourth quarter 2008 versus fourth quarter 2007 primarily due to a narrowing in the differential between gasoline and ethanol prices.
Crude oil refined is expected to average approximately 950,000 bpd for the entire fourth quarter 2008, compared to 956,000 bpd in the fourth quarter of 2007. Total refinery throughputs for the fourth quarter 2008 are expected to be about 1,175,000 bpd compared to 1,179,000 bpd in the fourth quarter of 2007.
Speedway SuperAmerica LLC's (SSA) gasoline and distillate gross margin averaged $0.2044 per gallon during October and November 2008 and is expected to average approximately $0.18 per gallon for the fourth quarter of 2008. SSA same store gasoline sales volume for the first two months of the fourth quarter 2008 decreased slightly compared to the first two months of the fourth quarter 2007; however, the Company projects that SSA's same store gasoline sales volume for the entire quarter will be slightly better than the same quarter last year.
Integrated Gas
Marathon's liquefied natural gas (LNG) operations in Equatorial Guinea and Alaska are estimated to have sold approximately 5,750 net metric tonnes per day (mtpd) of LNG in the fourth quarter of 2008, within the previous guidance of 5,500 to 6,100 mtpd.
Other Information
The overall corporate effective income tax rate for full year 2008, excluding special items and foreign currency remeasurement effects, is anticipated to remain between 46 and 49 percent. The actual annual effective tax rate is influenced by several factors including the geographical mix and timing of product sales.
Earnings Release Date and Conference Call Information
Marathon will report its fourth quarter 2008 results on Feb. 3, 2009. The Company will also conduct a conference call and webcast that same day at 2 p.m. EST. The call will cover fourth quarter and full year 2008 financial results and may include forward-looking information. Interested parties can listen to this call and view associated slides by accessing the Marathon Oil Corporation Web site at www.marathon.com and clicking on the Fourth Quarter 2008 Financial Results Conference Call link. Replays of the conference call will be available on the Web site through Feb. 17, 2009. Financial information, including earnings releases and other investor-related material, is also available online.
This release contains forward-looking statements with respect to estimates of the Company's worldwide liquid hydrocarbon and natural gas production, exploration expenses, mined bitumen production, synthetic crude oil sales, oil sands mining derivative gains and losses, refined products sales volume, refining and wholesale marketing gross margin per gallon, crude oil and total refinery throughputs, Speedway SuperAmerica LLC gasoline and distillate gross margins and sales volumes, LNG sales volumes, and the corporate effective income tax rate for 2008. These are preliminary estimates and are therefore subject to change. Actual results may differ materially from the estimates given in this update. In accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, Marathon Oil Corporation has included in its Annual Report on Form 10-K for the year ended December 31, 2007, and subsequent Forms 10-Q and 8-K, cautionary language identifying important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward- looking statements.
Select Operating and Financial Data (unaudited)
4Q 3Q Oct - Nov 4Q
2007 2008 2008 2008
Actual Actual Actual Actual
Exploration and Production
Net Sales(1)
Domestic - Liquid Hydrocarbons
(MBPD) 60 63 65 --
Domestic - Natural Gas (MMCFD) 474 426 459 --
International - Liquid
Hydrocarbons (MBPD) 130 161 190 --
International - Natural Gas
(MMCFD)(2) 510 502 621 --
MBOEPD(1) 354 379 435 --
Market Prices
NYMEX prompt WTI oil price
($/BBL) 90.50 118.22 68.01 59.08
Dated Brent oil price ($/BBL) 88.45 115.09 62.86 55.48
HH prompt natural gas price
($/MMBTU) 6.92 9.13 6.68 6.38
HH bid week natural gas price
($/MMBTU) 6.97 10.25 6.98 6.95
Average Realizations(3)
Liquid Hydrocarbons:
Domestic ($/BBL) 74.16 106.81 55.70 --
International ($/BBL) 84.64 113.10 63.30 --
Natural Gas:
Domestic ($/MCF) 5.70 7.70 4.59 --
International ($/MCF) 3.96 2.92 2.87 --
Oil Sands Mining
Net bitumen production (MBPD)(4) 15 28 24 --
Net synthetic crude sales (MBPD)(4) 17 32 32 --
Synthetic crude average
realization ($/BBL)(3) 71.07 113.42 58.99 --
Refining, Marketing and
Transportation
Chicago LLS 6-3-2-1 crack spread
($/BBL) 2.88 7.81 3.52 2.31
Gulf Coast LLS 6-3-2-1 crack
spread ($/BBL) 1.42 6.32 0.06 (0.01)
Chicago LLS 3-2-1 crack spread
($/BBL) 7.54 13.75 7.37 5.30
Gulf Coast LLS 3-2-1 crack spread
($/BBL) 5.81 11.88 3.05 2.45
Sweet/sour differential ($/BBL)(5) 14.23 11.38 9.59 9.90
Refinery Runs:
Crude oil refined (MBPD) 956 955 954 --
Other charge & blend stocks
(MBPD) 223 189 223 --
Total (MBPD) 1,179 1,144 1,177 --
Crude oil capacity utilization
(%)(6) 98 94 94 --
Refined product sales volumes
(MBPD)(7) 1,432 1,357 1,432 --
Refining & wholesale marketing
gross margin ($/gal)(8) 0.0480 0.2519 0.1809 --
SSA gasoline and distillate sales
(MMGal) 836 796 558 --
SSA gasoline and distillate gross
margin ($/gal) 0.1131 0.1690 0.2044 --
SSA merchandise gross margin
($million) 172 197 121 --
Integrated Gas
Sales Volumes (MTPD)(9)
LNG 3,890 6,048 7,126 --
Methanol 1,376 757 790 --
BBL - barrel MBPD - thousand barrels MMCFD - million cubic
per day feet per day
MMBTU - million British MMBPD - million barrels MTPD - metric tonnes
Thermal Units per day per day
MCF - thousand cubic gal - gallons MMGal - million
feet gallons
MBOEPD - thousand barrels
of oil equivalent per
day
(1) Amounts reflected are after royalties, except for Ireland and Canada where amounts are before royalties.
(2) Includes natural gas acquired for injection and subsequent resale.
(3) Excludes gains and losses on traditional derivative instruments and the unrealized effects of long-term U.K. natural gas contracts that are accounted for as derivatives.
(4) The oil sands mining operations were acquired October 18, 2007.
(5) 15% Arab Light, 20% Kuwait, 10% Maya, 15% Western Canadian Select, 40% Mars.
(6) Prior to January 1, 2008, crude oil capacity utilization was based on historical crude oil refining capacity of 974 MBPD. As of December 31, 2007, crude oil refining capacity was revised to 1.016 MMBPD.
(7) Total average daily volumes of all refined product sales to wholesale, branded and retail (SSA) customers.
(8) Sales revenue less cost of refinery inputs, purchased products and manufacturing expenses, including depreciation.
(9) LNG sales volumes include both consolidated sales and our share of the sales of an equity method investee.
Media Relations Contacts:
Lee Warren 713-296-4103
Leslie Hiltabrand 713-296-4102
Investor Relations Contacts:
Howard Thill 713-296-4140
Michol Ecklund 713-296-3919
Chris Phillips 713-296-3213
SOURCE Marathon Oil Corporation
Exploration and Production
Liquid hydrocarbon and natural gas production sold during the fourth quarter is estimated to be approximately 415,000 barrels of oil equivalent per day (boepd). Revenues are reported based on production sold during the period which can vary from production available for sale primarily as a result of the timing of international crude oil liftings and natural gas sales. Liquid hydrocarbon and natural gas production available for sale during the fourth quarter is expected to be approximately 401,000 boepd, which is 3 percent higher than the third quarter 2008 result of 389,000 boepd. The available for sale estimate was at the bottom of the 400,000 to 440,000 boepd fourth quarter guidance due primarily to three major factors: longer than expected downtime at the offshore Equatorial Guinea Alba platform due to pipeline issues; lower than expected Gulf of Mexico production from continued impacts related to 2008 hurricanes; and, the Oct. 31, 2008 sale of Marathon's non-core interests in the Heimdal area offshore Norway.
As shown in the attached table, Marathon's average liquid hydrocarbon realization for the first two months of the fourth quarter, as compared to the third quarter of 2008, decreased $51.11 per barrel domestically and $49.80 per barrel internationally, reflecting the general market price movements during the first two months of the quarter. For the entire fourth quarter of 2008, the average West Texas Intermediate (WTI) crude oil market price indicator was $59.14 per barrel lower than the third quarter of 2008 while the average Dated Brent indicator decreased $59.61 per barrel.
Marathon's domestic average natural gas price realization for October and November decreased $3.11 per thousand cubic feet (mcf) from the Company's average realized price in the third quarter of 2008. The average Henry Hub (HH) prompt natural gas price for the fourth quarter decreased $2.75 per million British Thermal Units (BTUs), while the average HH bid week natural gas price decreased $3.30 per million BTUs during this same period. International average gas realizations decreased $0.05 per mcf in the first two months of the fourth quarter compared to the third quarter of 2008.
Marathon's actual crude oil and natural gas price realizations vary from market indicators primarily due to product quality and location differentials.
Fourth quarter 2008 exploration expense is now expected to be between $125 to $175 million, which is within previous guidance.
Oil Sands Mining
For the fourth quarter 2008, the Company estimates that its net share of bitumen production before royalties from the Athabasca Oil Sands Project (AOSP) mining operation will be approximately 25,000 barrels per day (bpd), which is within the previous guidance of 23,000 to 28,000 bpd for the fourth quarter. Marathon's synthetic crude oil sales from AOSP for fourth quarter 2008 are estimated to be approximately 32,000 bpd. Marathon's average synthetic crude oil realization (excluding derivative impacts) for the first two months of the fourth quarter, as compared to third quarter 2008, decreased $54.43 per barrel, reflecting the general market price movements during the first two months of the fourth quarter.
For the fourth quarter 2008, the Company expects a net after-tax gain of approximately $134 million on crude oil derivative instruments intended to mitigate price risk related to sales of synthetic crude oil, of which approximately $6 million is realized and approximately $128 million is unrealized mark-to-market. The last of these derivative instruments expire at year end 2009.
Refining, Marketing and Transportation
The Company estimates its refined products sales volume will average approximately 1,400,000 bpd in the fourth quarter of 2008 compared to 1,432,000 bpd in the fourth quarter of 2007.
The Company estimates its fourth quarter 2008 refining and wholesale marketing gross margin will be approximately $0.12 per gallon as compared to $0.048 per gallon earned in the fourth quarter 2007, with the falling crude oil prices during the fourth quarter 2008, compared to rising prices in the fourth quarter 2007, being the primary reason for this projected increase. Additionally, the gross margin includes an estimated gain on derivative instruments of approximately $64 million in the fourth quarter of 2008 compared to a loss of $427 million in the fourth quarter of 2007. This change was primarily due to the change in crude oil prices during the fourth quarter 2008 compared to the fourth quarter 2007 noted above, as well as the fact that the Company no longer uses derivatives to mitigate its domestic crude oil acquisition price risk. These favorable variances were partially offset by an unfavorable year-over-year quarterly impact from a narrowing in the average sweet/sour differential on the Company's cost of sour crude oil purchases. In addition, Marathon's ethanol blending margins are projected to be less favorable in the fourth quarter 2008 versus fourth quarter 2007 primarily due to a narrowing in the differential between gasoline and ethanol prices.
Crude oil refined is expected to average approximately 950,000 bpd for the entire fourth quarter 2008, compared to 956,000 bpd in the fourth quarter of 2007. Total refinery throughputs for the fourth quarter 2008 are expected to be about 1,175,000 bpd compared to 1,179,000 bpd in the fourth quarter of 2007.
Speedway SuperAmerica LLC's (SSA) gasoline and distillate gross margin averaged $0.2044 per gallon during October and November 2008 and is expected to average approximately $0.18 per gallon for the fourth quarter of 2008. SSA same store gasoline sales volume for the first two months of the fourth quarter 2008 decreased slightly compared to the first two months of the fourth quarter 2007; however, the Company projects that SSA's same store gasoline sales volume for the entire quarter will be slightly better than the same quarter last year.
Integrated Gas
Marathon's liquefied natural gas (LNG) operations in Equatorial Guinea and Alaska are estimated to have sold approximately 5,750 net metric tonnes per day (mtpd) of LNG in the fourth quarter of 2008, within the previous guidance of 5,500 to 6,100 mtpd.
Other Information
The overall corporate effective income tax rate for full year 2008, excluding special items and foreign currency remeasurement effects, is anticipated to remain between 46 and 49 percent. The actual annual effective tax rate is influenced by several factors including the geographical mix and timing of product sales.
Earnings Release Date and Conference Call Information
Marathon will report its fourth quarter 2008 results on Feb. 3, 2009. The Company will also conduct a conference call and webcast that same day at 2 p.m. EST. The call will cover fourth quarter and full year 2008 financial results and may include forward-looking information. Interested parties can listen to this call and view associated slides by accessing the Marathon Oil Corporation Web site at www.marathon.com and clicking on the Fourth Quarter 2008 Financial Results Conference Call link. Replays of the conference call will be available on the Web site through Feb. 17, 2009. Financial information, including earnings releases and other investor-related material, is also available online.
This release contains forward-looking statements with respect to estimates of the Company's worldwide liquid hydrocarbon and natural gas production, exploration expenses, mined bitumen production, synthetic crude oil sales, oil sands mining derivative gains and losses, refined products sales volume, refining and wholesale marketing gross margin per gallon, crude oil and total refinery throughputs, Speedway SuperAmerica LLC gasoline and distillate gross margins and sales volumes, LNG sales volumes, and the corporate effective income tax rate for 2008. These are preliminary estimates and are therefore subject to change. Actual results may differ materially from the estimates given in this update. In accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, Marathon Oil Corporation has included in its Annual Report on Form 10-K for the year ended December 31, 2007, and subsequent Forms 10-Q and 8-K, cautionary language identifying important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward- looking statements.
Select Operating and Financial Data (unaudited)
4Q 3Q Oct - Nov 4Q
2007 2008 2008 2008
Actual Actual Actual Actual
Exploration and Production
Net Sales(1)
Domestic - Liquid Hydrocarbons
(MBPD) 60 63 65 --
Domestic - Natural Gas (MMCFD) 474 426 459 --
International - Liquid
Hydrocarbons (MBPD) 130 161 190 --
International - Natural Gas
(MMCFD)(2) 510 502 621 --
MBOEPD(1) 354 379 435 --
Market Prices
NYMEX prompt WTI oil price
($/BBL) 90.50 118.22 68.01 59.08
Dated Brent oil price ($/BBL) 88.45 115.09 62.86 55.48
HH prompt natural gas price
($/MMBTU) 6.92 9.13 6.68 6.38
HH bid week natural gas price
($/MMBTU) 6.97 10.25 6.98 6.95
Average Realizations(3)
Liquid Hydrocarbons:
Domestic ($/BBL) 74.16 106.81 55.70 --
International ($/BBL) 84.64 113.10 63.30 --
Natural Gas:
Domestic ($/MCF) 5.70 7.70 4.59 --
International ($/MCF) 3.96 2.92 2.87 --
Oil Sands Mining
Net bitumen production (MBPD)(4) 15 28 24 --
Net synthetic crude sales (MBPD)(4) 17 32 32 --
Synthetic crude average
realization ($/BBL)(3) 71.07 113.42 58.99 --
Refining, Marketing and
Transportation
Chicago LLS 6-3-2-1 crack spread
($/BBL) 2.88 7.81 3.52 2.31
Gulf Coast LLS 6-3-2-1 crack
spread ($/BBL) 1.42 6.32 0.06 (0.01)
Chicago LLS 3-2-1 crack spread
($/BBL) 7.54 13.75 7.37 5.30
Gulf Coast LLS 3-2-1 crack spread
($/BBL) 5.81 11.88 3.05 2.45
Sweet/sour differential ($/BBL)(5) 14.23 11.38 9.59 9.90
Refinery Runs:
Crude oil refined (MBPD) 956 955 954 --
Other charge & blend stocks
(MBPD) 223 189 223 --
Total (MBPD) 1,179 1,144 1,177 --
Crude oil capacity utilization
(%)(6) 98 94 94 --
Refined product sales volumes
(MBPD)(7) 1,432 1,357 1,432 --
Refining & wholesale marketing
gross margin ($/gal)(8) 0.0480 0.2519 0.1809 --
SSA gasoline and distillate sales
(MMGal) 836 796 558 --
SSA gasoline and distillate gross
margin ($/gal) 0.1131 0.1690 0.2044 --
SSA merchandise gross margin
($million) 172 197 121 --
Integrated Gas
Sales Volumes (MTPD)(9)
LNG 3,890 6,048 7,126 --
Methanol 1,376 757 790 --
BBL - barrel MBPD - thousand barrels MMCFD - million cubic
per day feet per day
MMBTU - million British MMBPD - million barrels MTPD - metric tonnes
Thermal Units per day per day
MCF - thousand cubic gal - gallons MMGal - million
feet gallons
MBOEPD - thousand barrels
of oil equivalent per
day
(1) Amounts reflected are after royalties, except for Ireland and Canada where amounts are before royalties.
(2) Includes natural gas acquired for injection and subsequent resale.
(3) Excludes gains and losses on traditional derivative instruments and the unrealized effects of long-term U.K. natural gas contracts that are accounted for as derivatives.
(4) The oil sands mining operations were acquired October 18, 2007.
(5) 15% Arab Light, 20% Kuwait, 10% Maya, 15% Western Canadian Select, 40% Mars.
(6) Prior to January 1, 2008, crude oil capacity utilization was based on historical crude oil refining capacity of 974 MBPD. As of December 31, 2007, crude oil refining capacity was revised to 1.016 MMBPD.
(7) Total average daily volumes of all refined product sales to wholesale, branded and retail (SSA) customers.
(8) Sales revenue less cost of refinery inputs, purchased products and manufacturing expenses, including depreciation.
(9) LNG sales volumes include both consolidated sales and our share of the sales of an equity method investee.
Media Relations Contacts:
Lee Warren 713-296-4103
Leslie Hiltabrand 713-296-4102
Investor Relations Contacts:
Howard Thill 713-296-4140
Michol Ecklund 713-296-3919
Chris Phillips 713-296-3213
SOURCE Marathon Oil Corporation
Frontier Oil Plans Earnings Release and Conference Call February 26
HOUSTON, Jan 15, 2009 (BUSINESS WIRE) --
Frontier Oil Corporation (NYSE: FTO) plans to announce results for the quarter ended December 31, 2008 on Thursday, February 26, 2009. Management has scheduled a conference call for the morning of February 26th at 11:00 a.m. ET to discuss the financial results and business outlook.
To access the call, which is open to the public, please dial (888) 211-0226 several minutes prior to the call. For those individuals outside the United States, please call (913) 312-0828. A recorded replay of the call may be heard through March 12, 2009 by dialing (888) 203-1112 (international callers (719) 457-0820 and entering the code 4427813.) In addition, the real-time conference call and a recorded replay will be available via webcast by registering from the Investor Relations page of our website www.frontieroil.com.
Frontier operates a 130,000 barrel-per-day refinery located in El Dorado, Kansas, and a 52,000 barrel-per-day refinery located in Cheyenne, Wyoming, and markets its refined products principally along the eastern slope of the Rocky Mountains and in other neighboring plains states.
SOURCE: Frontier Oil Corporation
Frontier Oil Corporation
Kristine Boyd, 713-688-9600 ext. 135
Copyright Business Wire 2009
Frontier Oil Corporation (NYSE: FTO) plans to announce results for the quarter ended December 31, 2008 on Thursday, February 26, 2009. Management has scheduled a conference call for the morning of February 26th at 11:00 a.m. ET to discuss the financial results and business outlook.
To access the call, which is open to the public, please dial (888) 211-0226 several minutes prior to the call. For those individuals outside the United States, please call (913) 312-0828. A recorded replay of the call may be heard through March 12, 2009 by dialing (888) 203-1112 (international callers (719) 457-0820 and entering the code 4427813.) In addition, the real-time conference call and a recorded replay will be available via webcast by registering from the Investor Relations page of our website www.frontieroil.com.
Frontier operates a 130,000 barrel-per-day refinery located in El Dorado, Kansas, and a 52,000 barrel-per-day refinery located in Cheyenne, Wyoming, and markets its refined products principally along the eastern slope of the Rocky Mountains and in other neighboring plains states.
SOURCE: Frontier Oil Corporation
Frontier Oil Corporation
Kristine Boyd, 713-688-9600 ext. 135
Copyright Business Wire 2009
Cabot Oil & Gas Fourth Quarter Results
HOUSTON, Jan. 12 /PRNewswire-FirstCall/ -- Cabot Oil & Gas (NYSE: COG) will release its year-end 2008 financial and operating results on Thursday, February 12, 2009.
A conference call with investors, analysts and other interested parties is scheduled for 9:30 a.m. EST (8:30 a.m. CST, 7:30 a.m. MST, 6:30 a.m. PST) on Friday, February 13, 2009 to discuss fourth quarter 2008 operating results. You are invited to listen to the call which will be broadcast live over the Internet at www.cabotog.com.
A replay will be available from Friday, February 13, 2009 through Sunday, February 15, 2009. You may access this replay at (800) 642-1687, (U.S./Canada) or (706) 645-9291 (International), passcode 80498112.
Cabot Oil & Gas Corporation, headquartered in Houston, Texas, is a leading independent natural gas producer with substantial interests in the Gulf Coast, including Texas and Louisiana; the West, including the Rocky Mountains and Mid-Continent; the East and Canada. For additional information, visit the company's Internet homepage at www.cabotog.com.
SOURCE Cabot Oil & Gas
CONTACT: Scott Schroeder of Cabot Oil & Gas, +1-281-589-4993
A conference call with investors, analysts and other interested parties is scheduled for 9:30 a.m. EST (8:30 a.m. CST, 7:30 a.m. MST, 6:30 a.m. PST) on Friday, February 13, 2009 to discuss fourth quarter 2008 operating results. You are invited to listen to the call which will be broadcast live over the Internet at www.cabotog.com.
A replay will be available from Friday, February 13, 2009 through Sunday, February 15, 2009. You may access this replay at (800) 642-1687, (U.S./Canada) or (706) 645-9291 (International), passcode 80498112.
Cabot Oil & Gas Corporation, headquartered in Houston, Texas, is a leading independent natural gas producer with substantial interests in the Gulf Coast, including Texas and Louisiana; the West, including the Rocky Mountains and Mid-Continent; the East and Canada. For additional information, visit the company's Internet homepage at www.cabotog.com.
SOURCE Cabot Oil & Gas
CONTACT: Scott Schroeder of Cabot Oil & Gas, +1-281-589-4993
Former German Chancellor Gerhard Schroeder Agrees To Join TNK-BP Board
Release date: 15 January 2009
BP today announced that the shareholders in TNK-BP have agreed to appoint three independent directors, including former chancellor of the Federal Republic of Germany, Gerhard Schroeder, to the restructured main board of TNK-BP. His fellow independents will be James Leng, the chairman designate of Rio Tinto, and Alexander Shokhin, president of the Russian Union of Industrialists and Entrepreneurs.
BP and Alfa-Access Renova (AAR) have agreed to appoint the three directors to avoid the risk of deadlock between the 50:50 owners of the joint venture, which are represented on the 11-strong board by four directors from each side.
BP's four nominated directors on the main board of TNK-BP are: Andy Inglis, chief executive of BP's upstream business, David Peattie, BP's head of Russian business, Iain Macdonald, BP's deputy chief financial officer and Lord Robertson of Port Ellen. The AAR-nominated directors are Alfa Group chairman, Mikhail M Fridman, Renova Group chairman, Viktor F Vekselberg, Access Industries chairman, Len Blavatnik and Chairman of Pamplona Capital Management, Alex Knaster.
Until a new CEO of TNK-BP is announced, Tim Summers will continue in the role.
Welcoming the new structure, BP chief executive Tony Hayward said: "We believe the composition of this board, which includes individuals of significant distinction in business and politics, can achieve good business alignment between the shareholders of TNK-BP and safeguard the interests of all sides.
"I am especially pleased that Gerhard Schroeder has agreed to join the restructured board. The counsel of such a distinguished statesman, who brings both enormous geo-political experience and a history of strong relationships with Russia, gives me particular confidence that the next chapter in the progress of TNK-BP will be good for all shareholders and for Russia."
Herr Schroeder said: "I am looking forward to working together with the other members of the main board of TNK-BP. I feel certain that, with the support and trust of both shareholder groups, I will be able to make a contribution to the company's success that will serve as an important example of Russia's cooperation with international investors, thereby providing a significant contribution to Russia's integration in the global economy."
Further information:
Name: BP Press Office
Location: London
Phone : +44 (0)20 7496 4076
Name: BP Russia
Location: Moscow
Phone : +7495 363 6262
BP today announced that the shareholders in TNK-BP have agreed to appoint three independent directors, including former chancellor of the Federal Republic of Germany, Gerhard Schroeder, to the restructured main board of TNK-BP. His fellow independents will be James Leng, the chairman designate of Rio Tinto, and Alexander Shokhin, president of the Russian Union of Industrialists and Entrepreneurs.
BP and Alfa-Access Renova (AAR) have agreed to appoint the three directors to avoid the risk of deadlock between the 50:50 owners of the joint venture, which are represented on the 11-strong board by four directors from each side.
BP's four nominated directors on the main board of TNK-BP are: Andy Inglis, chief executive of BP's upstream business, David Peattie, BP's head of Russian business, Iain Macdonald, BP's deputy chief financial officer and Lord Robertson of Port Ellen. The AAR-nominated directors are Alfa Group chairman, Mikhail M Fridman, Renova Group chairman, Viktor F Vekselberg, Access Industries chairman, Len Blavatnik and Chairman of Pamplona Capital Management, Alex Knaster.
Until a new CEO of TNK-BP is announced, Tim Summers will continue in the role.
Welcoming the new structure, BP chief executive Tony Hayward said: "We believe the composition of this board, which includes individuals of significant distinction in business and politics, can achieve good business alignment between the shareholders of TNK-BP and safeguard the interests of all sides.
"I am especially pleased that Gerhard Schroeder has agreed to join the restructured board. The counsel of such a distinguished statesman, who brings both enormous geo-political experience and a history of strong relationships with Russia, gives me particular confidence that the next chapter in the progress of TNK-BP will be good for all shareholders and for Russia."
Herr Schroeder said: "I am looking forward to working together with the other members of the main board of TNK-BP. I feel certain that, with the support and trust of both shareholder groups, I will be able to make a contribution to the company's success that will serve as an important example of Russia's cooperation with international investors, thereby providing a significant contribution to Russia's integration in the global economy."
Further information:
Name: BP Press Office
Location: London
Phone : +44 (0)20 7496 4076
Name: BP Russia
Location: Moscow
Phone : +7495 363 6262
Hugo Chavez Calling for more OPEC Oil Production Cuts
There's no doubt Hugo Chavez is mildly tolerated by the people of Venezuela, as he's taken the money from the oil industry he nationalized and redistributed it to the healthcare and education systems in the country.
Now that oil prices have plummeted, and Chavez is attempting to change the terms of being in office, he's pushing hard for oil production cuts from OPEC in order to push up the price of oil, whose demand has fallen along with the global recession. About half of Venezuelan government spending comes from oil proceeds.
Another step by Chavez which is destined to fail, is he's now reaching out to foreign investors again in order to shore up his domestic industry. But since Chavez stole the industry from major oil companies, there is no trust that once deals are made the contracts will be honored. They'd only be honored as long as the country's needs and his personal agenda was met. Once that was accomplished, we know he would once again break his word and take things back under his control.
Once a socialist always a socialist. Anyone that doesn't see that deserves to learn the hard way.
Now that oil prices have plummeted, and Chavez is attempting to change the terms of being in office, he's pushing hard for oil production cuts from OPEC in order to push up the price of oil, whose demand has fallen along with the global recession. About half of Venezuelan government spending comes from oil proceeds.
Another step by Chavez which is destined to fail, is he's now reaching out to foreign investors again in order to shore up his domestic industry. But since Chavez stole the industry from major oil companies, there is no trust that once deals are made the contracts will be honored. They'd only be honored as long as the country's needs and his personal agenda was met. Once that was accomplished, we know he would once again break his word and take things back under his control.
Once a socialist always a socialist. Anyone that doesn't see that deserves to learn the hard way.
Wednesday, January 14, 2009
U.S Government Offers Energy Companies Testing Acreage for Oil Shale
With as much as 800 billion barrels of oil at stake, government officials have offered energy companies the chance to test whether oil shale production can be done profitably.
The states of Colorado, Wyoming and Utah are the focus of the initiative, where much of the oil shale is on public lands.
What the Bureau of Land Management is offering is plots no larger than 640 acres to test the process on, which entails heating the rocks to recover the oil.
As usual, radical environmental groups are threatening to sue if things go forward.
There are approximately 1.9 million acres relevant in the three states to the proposal.
Just this U.S. resource alone holds over 5 times the proven reserves of Saudi Arabia.
The states of Colorado, Wyoming and Utah are the focus of the initiative, where much of the oil shale is on public lands.
What the Bureau of Land Management is offering is plots no larger than 640 acres to test the process on, which entails heating the rocks to recover the oil.
As usual, radical environmental groups are threatening to sue if things go forward.
There are approximately 1.9 million acres relevant in the three states to the proposal.
Just this U.S. resource alone holds over 5 times the proven reserves of Saudi Arabia.
Tuesday, January 13, 2009
Investigation Begins After Silver Eagle Refinery Explosion
Jeffrey D. Allred, Deseret News
Now that the fire is out at Silver Eagle Refinery, officials at the company, along with fire department, will begin investigations on what caused the blast that critically or seriously injured four workers, as well as leading hundreds being evacuated.
According to the South Davis Metro Fire Agency, the fire was finally put out at close to 4 a.m. by over 80 firefighters who worked for hours through the night to get a handle on the blaze. It started when after an explosion at around 5:30 on Monday.
Of the four injured workers - two employees and two contractors - one remains hospitalized with critical injuries. All four had either "second- or third-degree burns to their upper extremities," said refinery manager Kerry B. Carroll.
Those living within a half-mile of the refinery were forced to evacuate to a Woods Cross High School, which is located near the facility.
Investigators say it will probably take a week to conduct the investigation before finding the cause of the explosion.
Appellate Court Slaps Down Federal Government on "Anadarko Petroleum" Oil Royalties
With the U.S. government increasingly gravitating toward socialism, it was a welcome sign to see them slowed down by the decision of a federal appellate court, which affirmed the government had no right to dig their greedy hands into the revenues generated by oil company Anadarko Petroleum.
In a case that has been closely watched by the industry and big-government advocates, the Fifth Circuit Court of Appeals in New Orleans confirmed a lower-court ruling which said the government had no authority to collect the fossil-fuel royalties, which could end up totaling up to $10 billion.
Government sychophant Shane Wolfe, a spokesman for the Interior Department, said in his talking points, "If the court's interpretation of Congress's action in 1995 is correct, certain leaseholders will be allowed to produce massive amounts of oil and gas without paying royalties to the United States without regard to the price of oil and gas -- perhaps amounting to one of the biggest giveaways of federal resources by Congress in modern history."
This is nothing more than another socialist statement. When the oil companies are doing lousy, no one cares, as soon as they start making some money, the money wants to come in and steal it and redistribute it to worthless projects or unproductive people. That is a path of destruction that whenever is interrupted, we need to be thankful for.
Look at the manipulative language given to Wolfe to repeat: "... certain leaseholders will be allowed to produce massive amounts of oil and gas without paying royalties to the United States without regard to the price of oil and gas."
All of it is an effort to make an articial barrier between people and business, in order to make people believe the government is looking out for them. An old tactic for sure, but one that works when people are afraid and looking for someone to blame, along with a savior, which the government is glad to step in as.
Look at the phrase "without regard to the price of oil and gas." It's socialist to the core.
The U.S. government, which has caused the current economic crisis through faulty attempts to run the economy, now think they're able to make any type of healthy decision on energy prices in regard to the diminishing free market?
Why this is so important is when oil companies are doing good, they can than take the revenue and do more explorations, improve operations, invest in better technology, etc. They can also set aside money for the inevitable slow times like the current economic climate, where they can survive until things pick up again.
What the government is attempting to do is syphon off the productive periods of the company in the name of "fairness," so they can use it for their endless projects and activities that do nothing to add to the national or individual wealth.
As far as the specific issue in the court case, it surrounded the terms of the lease, which were connected to oil and gas production levels, rather than price thresholds, which the government has asserted.
The court saw the obvious duplicity of the government, which agreed to the terms of the law directly connected to production outputs, and not the price threshold the government wants to arbitrarily impose on the companies drilling in the Gulf of Mexico.
To show you how far the government will go to manipulate things, in 2004, according to the inept federal Minerals Management Service, the government stood to lose royalty payments as high as $60 billion.
Later on those figures were adjusted to between $6 billion to $10 billion. How does one miss estimates by 6 to 10 times over the upper reality of the numbers? Only a governmental agency could do that. Everyone else would be thrown in jail for fudging the numbers.
The so-called Government Accountability Office confirmed the lower estimate was the more accurate of the two projections.
Why throw out obvious bogus numbers? It's the old strategy of putting false information out to the public which will create an outrage based on false assertions. Even, as in this case, when the government has to backtrack, the damage is already done.
This should never have been a court case, as the terms of the lease, as the courts have confirmed, are completely being met. Idiotic lawmakers, who are looking for ways to steal more money from the public, instigated this by pressuring the court case to go forward, even wasting more of the taxpayers money.
Anothe reason government needs to stay out of the free market.
In a case that has been closely watched by the industry and big-government advocates, the Fifth Circuit Court of Appeals in New Orleans confirmed a lower-court ruling which said the government had no authority to collect the fossil-fuel royalties, which could end up totaling up to $10 billion.
Government sychophant Shane Wolfe, a spokesman for the Interior Department, said in his talking points, "If the court's interpretation of Congress's action in 1995 is correct, certain leaseholders will be allowed to produce massive amounts of oil and gas without paying royalties to the United States without regard to the price of oil and gas -- perhaps amounting to one of the biggest giveaways of federal resources by Congress in modern history."
This is nothing more than another socialist statement. When the oil companies are doing lousy, no one cares, as soon as they start making some money, the money wants to come in and steal it and redistribute it to worthless projects or unproductive people. That is a path of destruction that whenever is interrupted, we need to be thankful for.
Look at the manipulative language given to Wolfe to repeat: "... certain leaseholders will be allowed to produce massive amounts of oil and gas without paying royalties to the United States without regard to the price of oil and gas."
All of it is an effort to make an articial barrier between people and business, in order to make people believe the government is looking out for them. An old tactic for sure, but one that works when people are afraid and looking for someone to blame, along with a savior, which the government is glad to step in as.
Look at the phrase "without regard to the price of oil and gas." It's socialist to the core.
The U.S. government, which has caused the current economic crisis through faulty attempts to run the economy, now think they're able to make any type of healthy decision on energy prices in regard to the diminishing free market?
Why this is so important is when oil companies are doing good, they can than take the revenue and do more explorations, improve operations, invest in better technology, etc. They can also set aside money for the inevitable slow times like the current economic climate, where they can survive until things pick up again.
What the government is attempting to do is syphon off the productive periods of the company in the name of "fairness," so they can use it for their endless projects and activities that do nothing to add to the national or individual wealth.
As far as the specific issue in the court case, it surrounded the terms of the lease, which were connected to oil and gas production levels, rather than price thresholds, which the government has asserted.
The court saw the obvious duplicity of the government, which agreed to the terms of the law directly connected to production outputs, and not the price threshold the government wants to arbitrarily impose on the companies drilling in the Gulf of Mexico.
To show you how far the government will go to manipulate things, in 2004, according to the inept federal Minerals Management Service, the government stood to lose royalty payments as high as $60 billion.
Later on those figures were adjusted to between $6 billion to $10 billion. How does one miss estimates by 6 to 10 times over the upper reality of the numbers? Only a governmental agency could do that. Everyone else would be thrown in jail for fudging the numbers.
The so-called Government Accountability Office confirmed the lower estimate was the more accurate of the two projections.
Why throw out obvious bogus numbers? It's the old strategy of putting false information out to the public which will create an outrage based on false assertions. Even, as in this case, when the government has to backtrack, the damage is already done.
This should never have been a court case, as the terms of the lease, as the courts have confirmed, are completely being met. Idiotic lawmakers, who are looking for ways to steal more money from the public, instigated this by pressuring the court case to go forward, even wasting more of the taxpayers money.
Anothe reason government needs to stay out of the free market.
Petrobras Breaks Monthly Oil Export Record in December
Brazil's Petrobras broke its own monthly oil export record in December, as the government-run company announced it exported 620,000 barrels of oil daily, easily surpassing the past record of 574,000 barrels exported daily set in October 2008.
For the month of December, Petrobras exported a total of 19.234 million barrels, with the U.S. accounting for 63 percent of those exports.
Other regions of export significance for Petrobras were Europe, which accounted for 21.4 percent of oil exports, South America, accounting for 5.4 percent of exports, and Asian and Caribbean countries, which combined for 5.0 percent of exports.
Monthly revenue for the month of December came in at $574 million.
For the month of December, Petrobras exported a total of 19.234 million barrels, with the U.S. accounting for 63 percent of those exports.
Other regions of export significance for Petrobras were Europe, which accounted for 21.4 percent of oil exports, South America, accounting for 5.4 percent of exports, and Asian and Caribbean countries, which combined for 5.0 percent of exports.
Monthly revenue for the month of December came in at $574 million.
OPEC Export Revenue Dropping to Lowest Level in Five Years
Lower oil prices will cause export revenue for the Organization of the Petroleum Exporting Countries (OPEC) to drop to their lowest level in five years, according to the U.S. Energy Information Administration.
Most of the assertions of OPEC can only be taken with a grain of salt, as there's never full compliance by member nations, and the EIA confirms they're looking at only about half the projected cuts will in reality be made, which recently were decreased to a wishful 4.2 million barrels a day.
That leads them to project revenue for OPEC countries will be down by about $57 billion from last month's numbers, with overall revenue for the year reaching an estimated $387 billion.
Further out in 2010, there should be an increase to about $526 billion, still far below the $972 billion in revenue generated in 2008.
Taking into account the projections made when oil hit the record $147 a barrel during the summer, which were at $1.3 trillion for 2009, this is an extraordinary challenge for the OPEC countries which rely so much on the revenue to keep their countries stabilized.
Most of the assertions of OPEC can only be taken with a grain of salt, as there's never full compliance by member nations, and the EIA confirms they're looking at only about half the projected cuts will in reality be made, which recently were decreased to a wishful 4.2 million barrels a day.
That leads them to project revenue for OPEC countries will be down by about $57 billion from last month's numbers, with overall revenue for the year reaching an estimated $387 billion.
Further out in 2010, there should be an increase to about $526 billion, still far below the $972 billion in revenue generated in 2008.
Taking into account the projections made when oil hit the record $147 a barrel during the summer, which were at $1.3 trillion for 2009, this is an extraordinary challenge for the OPEC countries which rely so much on the revenue to keep their countries stabilized.
Monday, January 12, 2009
Arbitrage Opportunity as"Super Contango" Spurs Stockpiling of Oil
In what is called a "super contango," oil producers and refiners are storing up crude oil in record amounts in expectation that prices will surge in the summer months.
While a contango is the usual for oil markets, where up to a several-month gap between the current price of the delivery of oil is lower than that in the spring and summer. What insiders call a super contango, is when that spread of time lengthens beyond the norm, like it is at this time.
The spread in price is measured by the costs of oil storage versus tying up the money of investors.
February delivery of crude fell to $37.59 a barrel on the NYMEX, almost $15 less than the contract price for July. That's much farther out than usual, and so dubbed a super contango.
For the New York Mercantile Exchange, their delivery apex is in Cushing, Oklahoma, where inventory is up by over 40 percent for the month ending January 2. It's been 4 years since it held that much oil.
Overall, U.S. inventories for oil storage has increased 6.7 million barrels for the week ending January 2, ending at 325.4 million.
This contango period is expected to lengthen even more, and so Cushing could potentially fill to their capacity of 42.4 million barrels, although only about 80 percent of that capacity is operable storage space.
Some companies are leasing oil tankers at sea, as storage space is getting more difficult to find.
In an effort to cut costs, a number of American manufacturers started to cut spending on fuel in an move to manage the bottom line, which could also have a significant impact on storage.
What all this means as far as investors go, is it's a potentially lucrative arbitrage opportunity, as the decision to store oil at these prices for possible large profits in the future is the financial impetus behind all this.
What oil investors can do with this large of a spread, is buy up a January Oil contract and take physical delivery of the oil and store it, and then sell the higher-priced February contract at the same time.
With almost no risk involved, it's definitely something to look into quickly for just about guaranteed profits.
The ICE Futures exchange in London had Brent crude for February dropping by $1.51 to end the session at $42.91 a barrel.
On Wednesday, we'll get a better look at oil stockpiles from the weekly energy report.
While a contango is the usual for oil markets, where up to a several-month gap between the current price of the delivery of oil is lower than that in the spring and summer. What insiders call a super contango, is when that spread of time lengthens beyond the norm, like it is at this time.
The spread in price is measured by the costs of oil storage versus tying up the money of investors.
February delivery of crude fell to $37.59 a barrel on the NYMEX, almost $15 less than the contract price for July. That's much farther out than usual, and so dubbed a super contango.
For the New York Mercantile Exchange, their delivery apex is in Cushing, Oklahoma, where inventory is up by over 40 percent for the month ending January 2. It's been 4 years since it held that much oil.
Overall, U.S. inventories for oil storage has increased 6.7 million barrels for the week ending January 2, ending at 325.4 million.
This contango period is expected to lengthen even more, and so Cushing could potentially fill to their capacity of 42.4 million barrels, although only about 80 percent of that capacity is operable storage space.
Some companies are leasing oil tankers at sea, as storage space is getting more difficult to find.
In an effort to cut costs, a number of American manufacturers started to cut spending on fuel in an move to manage the bottom line, which could also have a significant impact on storage.
What all this means as far as investors go, is it's a potentially lucrative arbitrage opportunity, as the decision to store oil at these prices for possible large profits in the future is the financial impetus behind all this.
What oil investors can do with this large of a spread, is buy up a January Oil contract and take physical delivery of the oil and store it, and then sell the higher-priced February contract at the same time.
With almost no risk involved, it's definitely something to look into quickly for just about guaranteed profits.
The ICE Futures exchange in London had Brent crude for February dropping by $1.51 to end the session at $42.91 a barrel.
On Wednesday, we'll get a better look at oil stockpiles from the weekly energy report.
Europe Relieved as Russia and Ukraine Sign Gas Monitoring Agreement
Europe breathes a little easier as Russia and Ukraine sign agreement to keep gas flowing to region.
Friday, January 9, 2009
Oil Prices Continue to Drop on Slowing Demand
Crude Oil for February delivery ended the session at $40.83, a decline of 87 cents, or 2.1 percent. Prices fell as low as $39.38 on the New York Mercantile Exchange during the day.
So far the announcements and compliance of OPEC nations in cutting production hasn't been a factor in determining the prices of crude. Demand continues to be the main driver of prices, rather than supply.
Many investors fled the sector Friday, fleeing from energy companies in droves.
Energy sector watchers now think the announcement of oil service behemoth Schlumberger (SLB) that they are going to cut 1,000 jobs in the U.S., along with overseas workers as well, is the beginning of further cuts in the industry. Halliburton (HAL) also said they're going to be laying off workers too.
To add fuel to the fire, Chevron (CVX) issued a warning today that their fourth-quarter results were going to be "significantly lower" than the heady third quarter's results. While that's not a surprise, combining those elements together shook up energy investors today.
This is going to be the wave of the near term, and the companies are going to suffer dramatically in contrast to recent success.
So far the announcements and compliance of OPEC nations in cutting production hasn't been a factor in determining the prices of crude. Demand continues to be the main driver of prices, rather than supply.
Many investors fled the sector Friday, fleeing from energy companies in droves.
Energy sector watchers now think the announcement of oil service behemoth Schlumberger (SLB) that they are going to cut 1,000 jobs in the U.S., along with overseas workers as well, is the beginning of further cuts in the industry. Halliburton (HAL) also said they're going to be laying off workers too.
To add fuel to the fire, Chevron (CVX) issued a warning today that their fourth-quarter results were going to be "significantly lower" than the heady third quarter's results. While that's not a surprise, combining those elements together shook up energy investors today.
This is going to be the wave of the near term, and the companies are going to suffer dramatically in contrast to recent success.
Saturday, January 3, 2009
Terrorist Attack on Nigerian Oil Pipeline
Another oil pipeline in Nigeria was possibly attacked by major terrorist group Emancipation of the Niger Delta, which demands funds from the oil transferred through the pipeline.
There's also a possibility that two tribal communities, the Ogulagha and the Odimodi, may have participated in the attack, as they have fought over land ownership for some time that the pipeline runs on, battling for a higher share of the money.
Over the last couple years, ongoing attacks on oil pipelines has resulted in production declining by 25 percent in Nigeria. Italy's Agip, subsidiary of Italian energy behemoth Eni SpA, owns the pipeline.
Nigeria is the United States fifth-largest supplier of oil.
There's also a possibility that two tribal communities, the Ogulagha and the Odimodi, may have participated in the attack, as they have fought over land ownership for some time that the pipeline runs on, battling for a higher share of the money.
Over the last couple years, ongoing attacks on oil pipelines has resulted in production declining by 25 percent in Nigeria. Italy's Agip, subsidiary of Italian energy behemoth Eni SpA, owns the pipeline.
Nigeria is the United States fifth-largest supplier of oil.
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