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– In 2018, coal production in the United States decreased second lowest total since 1978, after peaking at 1,172 million short tons in 2008.
– Production and consumption fell at the same time. Consumption dropped to 687 million short tons last year, its lowest level in four years.
– The vast majority of coal consumed is used for the production of electricity. The ongoing closure of coal-fired power plants is likely to lead to steady declines in coal production and consumption for the coming years.
Market relocation
• Cabot Oil & Gas (NYSE: COG) fell 5% on Monday, falling to its lowest level in four months. Other natural gas producers also fell sharply. Natural gas prices have fallen to their lowest levels in three years due to the increase in supply.
• Devon Energy (NYSE: DVN) announced a voluntary goal to reduce methane, aiming to reduce emissions by 12.5% from current levels, to reach a methane intensity of 0.28% by 2025.
• the old reserves (NASDAQ: LGCY), a Permian shale driller, filed for the protection of Chapter 11 bankruptcy.
Tuesday, June 11, 2019
Oil prices rebounded a bit on Tuesday after Saudi Arabia ensured that OPEC would not let the oil market slide further. "Prices find support because OPEC oil production remains limited in the middle of the year," Commerzbank said in a note.
Russia not engaged in OPEC cuts +. Saudi Oil Minister Khalid al-Falih traveled to Moscow to meet with his counterpart. They have apparently raised the possibility that crude oil will crash at less than $ 40 per barrel without an agreement in Vienna. While Russia has been reluctant to engage in an extension, market badysts believe that the likelihood of renewed reductions is likely.
Related: Iran will not leave OPEC
The United States is considering sanctions for EU-Iran trade. The Trump administration is considering another set of sanctions that would target the European Union's financial vehicle to keep trade alive with Iran. US sanctions would affect the financial entity created by Iran to do business with the EU. Europe's effort was largely insufficient, but any move by the United States would hurt its relations with its European allies.
Iran will not leave OPEC. Iran has no intention of leaving OPEC as the group has been turned into "a political forum", calling it an enemy, said Iran's Minister of Petroleum, Bijan Zanganeh. Iran is outraged by the apparent cooperation between Saudi Arabia and the United States in order to block Iranian oil exports.
Airlines prepare for higher fuel costs after IMO rules. As new marine fuel regulations come into effect early next year, jet fuel could become more expensive. The increased demand for low-sulfur fuels and distillates will reduce the supplies needed by the aviation sector.
Shell ships Prelude's first shipment of LNG. Royal Dutch Shell (NYSE: RDS.A) shipped its first shipment from its Prelude FLNG (Floating LNG) facility off the coast of Western Australia, one of the world's most expensive and anticipated LNG export terminals. "The first [LNG] Freight arrived more than eight years after IDF and nearly two years after its installation in Australia. The speed with which Prelude delivers its second and third cargoes and accelerates to a plateau production will be a key indicator of success, "said Daniel Toleman, senior badyst at Wood Mackenzie.
Wall Street cuts financing for shale. The red ink accumulated by US shale companies prevents them from accessing capital markets more easily, as investors are fed up with poor returns. New issues of bonds and shares ceased, leading to an increase in badet sales. If low oil prices persist, bankruptcies could begin to accumulate.
The wind industry is booming, but tariffs are a threat. The wind industry is growing rapidly and is hiring many workers, but tariffs could slow development, according to CNBC.
Trump admin is considering new sanctions on Venezuela. The Trump administration is considering secondary sanctions that would close the possibilities for Venezuela to export its oil. However, badysts believe that more sanctions would have little effect since Venezuela exports to non-compliant countries. "Russia will not stop trading oil with Venezuela as a result of official secondary sanctions, especially since Russia itself is sanctioned by the United States," S & S said. P Lisa Viscidi, Director of Energy, Climate Change and Extractive Industries at the Inter-American Dialogue Global Platts. Related: BP: Petrochemicals driving oil demand boom in the United States
Refiners sue Trump against ethanol. US fuel and petrochemical manufacturers are currently suing Trump 's administration in court for its decision to authorize the sale throughout the year of the E15, a higher concentration of petrol and petrochemical products. 39; ethanol.
Biofuels do not lower gas prices. A new US government report found that the renewable fuel standard, which requires refiners to blend biofuels with their fuel mixes, has not helped lower gasoline prices. And in distant states of ethanol production, the norm has resulted in a slight increase in prices.
The exodus of oil from Alberta leaves Calgary real estate in difficulty. Bloomberg noted the growing number of vacancies in the Calgary real estate market due to the exodus of international oil sands oil companies from Canada. The job cuts at Canadian producers have also added to the misfortune. Since 2016, more than 20 percent of Calgary's downtown office space is available for lease, Bloomberg said, about five times the rate in Toronto or Vancouver.
Keystone XL delayed. A federal court ruled that the construction of Keystone XL could go forward, but TC Energy (NYSE: TRP), formerly TransCanada, missed the construction window for the year. "There will be no mainline construction in 2019 in the United States," said a spokesman for TC Energy at the Financial Post.
Hedge funds sell oil on their economic fears. Hedge funds and other fund managers continued to liquidate their long-term positions on crude oil futures as fears of an economic slowdown intensify. The decline contributed to worsening the decline in prices.
Texas drillers reinject gas into wells. While the overabundance of natural gas in West Texas has worsened, a number of E & P begin to reinject gas into their wells. The benefits are twofold: avoid flaring while stimulating oil recovery. EOG Resources (NYSE: EOG) found that in some cases, it could increase oil production by 30 to 70%. Meanwhile, new Mexican regulators are beginning to draft new rules on methane emissions.
Shell must return $ 125 billion to shareholders. Royal Dutch Shell (NYSE: RDS.A) said he was about to surrender $ 125 billion to shareholders between 2021 and 2025 through dividends and share buybacks. Shell is also devoting a growing share of its spending to energy production, a strategy for planning a low-carbon future.
Major oil companies flooded with climate-related lawsuits. A growing number of cities and states are suing major oil companies and demanding damages related to climate change. For example, the city of Baltimore claims damages related to the high cost of upgrading storm sewers. San Francisco wants money to build a dike. The FT reports that the dispute resembles the Big Tobacco strategy. "They are frightened by the prospect of a responsibility for what they have done and they are afraid of the courts," said Rhode Island Senator Sheldon Whitehouse (D).
By Tom Kool for Oilprice.com
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