Here are 10 Things You Should Know About Oil and Gas Today:
The Big Story
There are actually two big stories today: 1)The price of oil has crashed below $12 per barrel amid concerns that global crude storage capacity will fill during May, and 2) today is the 10th anniversary of the Deepwater Horizon disaster. So, a pair of very ugly stories dominate the oil and gas landscape today.
U.S. Oil Prices Fall To $11 Per Barrel In Historic Crash – One of an array of stories on the oil price crash from Oilprice.com.
The Deepwater Horizon Disaster: A Horrible Event That Must Never Happen Again – My own retrospective on the Deepwater Horizon disaster and why the industry cannot ever allow anything like it to happen again.
A decade after Deepwater Horizon, time to end Gulf of Mexico drilling – An alarmist op/ed from Chris Tomlinson at the Houston Chronicle.
Over the last decade, BP and its drilling partners have put at least $71 billion into mitigating the disaster’s effects.
The firehose of money started almost immediately after the accident, when BP dedicated $20 billion to cover clean-up costs, pay for independent research into the cause and effects of the spill, and to begin to compensate the tens of thousands of people and businesses affected, physically and financially.
President Donald Trump said the “big Oil Deal” sealed a week ago will save hundreds of thousands of American jobs. But the agreement he brokered depends on a sharp downturn in shale that will probably bring about a wave of bankruptcies and job cuts.
Days of frantic diplomatic maneuvering culminated in an agreement last Sunday by OPEC+ to pare production by 9.7 million barrels a day, ending a devastating price war between Saudi Arabia and Russia and belatedly tackling a plunge in demand caused by the coronavirus outbreak. The lockdowns enacted across much of the world to slow its spread have caused consumption to crater by as much as 35 million barrels a day.
Keystone XL Pipeline Ruling Could Hamper U.S. Energy Project Permits – Good piece about the implications of an Obama-appointed federal judge’s ruling. Luckily, the ruling will almost certainly be overturned on appeal.
Numerous U.S. and Canadian oil companies have said they are reducing output in 2020, but a Reuters analysis of the announcements so far show that just three companies – Chevron Corp (CVX.N), ConocoPhillips (COP.N) and Occidental Petroleum Corp (OXY.N) – account for more than half of the cuts…
Along with Chevron, which slashed its output in the Permian basin, the largest U.S. shale field, by 20% or 125,000 bpd, and Occidental Petroleum, which reduced 2020 output by 85,000 boepd, the three companies account for 410,000 boepd of the reductions announced by U.S. and Canadian companies.
CEO: Oil drilling, fracking could drop another 60% – A dire prediction from the CEO of Halliburton.
About a week ago, the Louisiana Oil and Gas Association released results of a member survey it says show that without aid, more than 23,000 jobs, which generate $2.2 billion in earnings annually, are at immediate risk.
Both groups have proposed a long list of aid requests, including tax breaks, actions to increase government and private oil storage capacity and loosening some of the regulations they say drive up drilling and production costs.
Those actions are likely to get the consideration they deserve by a state task force formed Friday to plan the reopening of Louisiana’s economy as the health crisis allows. Leaders from both the SCIA and the Louisiana Oil and Gas Association, and many others from the oil industry, are members of the panel, which will make recommendations to the Legislature.
Saudi Arabia and Russia signaled they may be open to further output cuts after the latest OPEC+ deal to curb global oil supplies failed to stem crude’s downward spiral.
The two nations will “continue to closely monitor the oil market and are prepared to take further measures jointly with OPEC+ and other producers if these are deemed necessary,” Russian Energy Minister Alexander Novak and his Saudi counterpart Prince Abdulaziz bin Salman said in a joint statement published after a phone call.
That’s all for today.