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OIL Oilexco

6.90
0.00 (0.00%)
27 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Oilexco LSE:OIL London Ordinary Share CA6779091033 COM SHS NPV (CDI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 6.90 - 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

Oilexco Share Discussion Threads

Showing 16926 to 16935 of 22150 messages
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DateSubjectAuthorDiscuss
12/3/2017
12:27
I am now out of IAE - bought more AEX instead.
joestalin
11/3/2017
18:42
Race to Bottom on Costs May Cause Oil to Choke on Supplies
Here is the opening of this topical article by Bloomberg:

Houston hosted two events this week: the nation’s largest energy conference and the town’s famous rodeo. They have more in common than you’d think.

In both cases, the key for top performers is how efficiently they perform. For cowboys, it means tightly controlling every muscle to stick on a bucking bronco. For energy executives, it means controlling every cost to lower the break-even price and survive what’s been a wild ride on the oil market.

When companies can lower the price at which they break-even, it means they can approve more projects and produce more oil, keeping dividends safe and investors happy. The risk: By drilling up their share price, they can also end up drilling down the price of oil. Welcome to 2017, the year after a two-year market rout made companies more efficient. At the CERAWeek by IHS Markit conference this week, fears of too much supply were palpable.

"Everyone is driving break-even prices down," Deborah Byers, head of U.S. oil and gas at consultants Ernst & Young LLP in Houston, said in an interview at the meeting, the largest annual gathering of industry executives in the world. "It isn’t just shale companies; it’s everyone, from deep-water to conventional."

As the conference was ongoing, those fears took physical form as West Texas Intermediate, the U.S. crude benchmark, plunged 9.1 percent this week, closing below the key $50-a-barrel level for the first time this year. It settled at $48.49 on Friday.

The slump came as Scott Sheffield, chairman of Pioneer Natural Resources Co., said prices could fall to $40 if OPEC doesn’t extend its existing agreement to cut production. Shale billionaire Harold Hamm, the CEO of Continental Resources Inc., warned undisciplined growth could "kill" the oil market.

The buzzword was efficiency. In panel discussions and keynote speeches, executive after executive tried to outdo rivals in announcing their low break-even prices. Eldar Saetre, head of the Norwegian oil giant Statoil ASA, told delegates that break even for his company’s next generation of projects had fallen from $70-plus to "well below" $30 a barrel.


David Fuller's view
Analysis of the international oil market today is simple, albeit very different from what the industry has experienced in earlier decades. Thanks to technology, oil companies around the world can now produce more crude at $50 a barrel than the global economy can consume. Furthermore, the average cost of production is still declining and is likely to be considerably lower ten to twenty years from now.

The world will never run out of oil, even when the global economy is booming with the help of cheaper energy prices. This is not because the supply of oil in the ground is infinite, which it is not. Instead, the world is approaching peak oil demand within the next decade, because other forms of energy continue to become more competitive, thanks to technology, and they cause less pollution.

The only way oil prices can move considerably higher than today’s levels for both Brent and WTI crude, is if production is sharply curtailed, for one reason or another. While theoretically possible, this is unlikely beyond the short term, if at all.

fangorn2
11/3/2017
14:52
interesting to note IAE now being bid for & Soco still waiting re Mongolian monies
...also a number of the mini charts in the header now flat lining due to take out or bust

bountyhunter
10/3/2017
16:31
Oil is obviously an immensely important commodity. However, its days as a fuel are now in decline

This is not true. He may well be right that oil use will decline over the 2020s - but oil demand is not currently falling, and it's unlikely to start falling for a few years yet. I think it's far from clear cut that demand in 2030 will be less than in 2017 - though it may well be declining by then.

That's entirely consistent with what van Beurden is quoted as saying at the top of the piece.

Peter

greyingsurfer
10/3/2017
16:22
interesting, '...pulled out of Alaska where it wasted $9bn on a "dry well"',
that was an expensive well!

bountyhunter
10/3/2017
08:41
Green van Beurden of Shell Warns On Looming Peak Oil Demand
Here is the opening of this interesting article from Ambrose Evans-Pritchard for The Telegraph:

Shell's chief executive Ben van Beurden has warned global energy leaders to brace for the shock of falling oil use as soon as the 2020s, warning that those who trivialise the threat of climate change will exhaust public tolerance for fossil fuel companies if they are not careful.

"We have to acknowledge that oil demand will peak, and it could already be in the next decade. It could happen. There are people who believe it will grow forever but I don't subscribe to that," he told the CERAWeek energy forum of IHS Markit.

Mr van Beurden said the industry is skating on thin political ice - notwithstanding the election of Donald Trump in the US - and needs to shore up its flank. "Social acceptance is just disappearing. I do think trust has been eroded to the point that it is becoming a serious issue for our long term future," he said.

"This is the biggest challenge of my career. We're under a lot scrutiny and pressure. It is not a rational discussion any more, it's emotional," he said. Regulators across the world are starting to demand that fossil fuel companies account for 'stranded assets' and financial risks from climate change, leading in turn to a shareholder pressure on the boards.

Claims of peak demand are anathema in the US oil capital of Houston. "Wishful thinking," said Chevron's chief John Watson. Saudi Arabia's energy minister Khalid al-Falih said talk of peak demand is ridiculous and ultimately dangerous, discouraging vitally-needed investment before alternatives are on offer. "They are compromising the world's energy security," he said.

Mr van Beurden advised the oil and gas industry to take an activist approach to show that it takes the threat of global warming seriously. Shell is already the biggest provider of renewable energy in the US through its wind farms. It is planning to invest $1bn a year in green technologies, and carbon capture and storage.

"You can be too early on this, as we discovered to our detriment. You have to get the timing right," he said. This time the stars are finally coming into alignment as renewable costs fall to parity with fossils.

Shell can afford the luxury of this 'moral' position because it has already made the switch to natural gas, the lone fossil fuel winner of the Paris Agreement on climate change. Gas emits roughly half the C02 of coal in power generation. It is also the perfect back-up for intermittent solar and wind.

“The largest contribution Shell can make to reducing emissions globally in the near term is to continue to grow the role of natural gas,” he said. The company has finished integrating BG following the $52bn takeover in 2016, creating a gas giant and $4bn of synergies this year. "We have taken a tremendous amount of cost out," he said.

The BG merger is one prong of the strategy. The recent sale of $8.5bn of oil sands acreage in Canada is another. Shell is today far less exposed to the political risk of climate change.

The group has not abandoned oil, although it has pulled out of Alaska where it wasted $9bn on a "dry well". Mr van Beurden said the regulatory overkill in Arctic waters, married with high costs, made it pointless to continue.


David Fuller's view
Ben van Beurden is a brave man, having entered the wounded lions’ den at the CERAWeek energy forum of HIS Markit in Houston, and delivered this message. I trust he came away unscratched.

I think he is right. In fact, I said so, more or less, in Monday’s Comment of the day. I won’t repeat all those points but you can either scroll back to Monday, or use these two links to access Email of the day 2 on crude oil, and also AE-P’s earlier article: Permain Shale Boom in Texas Is Devastating for OPEC.

Oil is obviously an immensely important commodity. However, its days as a fuel are now in decline, for all the reasons mentioned above. That will not change. However, oil is a very useful chemical, both today and in the foreseeable future. That will be no consolation for oil producers because both the demand for oil and its price will be much lower a decade from now.

These changes are entirely due to our era of accelerating technological innovation. To appreciate the significance of this, just consider the example of oil over the last decade. In fact, only a few years ago experienced commentators were still telling us that the world was rapidly running out of crude oil. Today, I suggest there is far more oil available than the world will ever require.

fangorn2
10/3/2017
08:39
US Shale Surge Overwhelms Oil Market as OPEC Splits Deepen
Here is a section of this topical article by Ambrose Evans-Pritchard in Houston, for The Telegraph:

Oil prices have plunged to the lowest level this year as US shale producers boost output at an astonishing pace and crude inventories keep rising, triggering a wave of selling by hedge funds with record speculative positions.

The US surge threatens to neutralise cuts agreed by the OPEC cartel and a Russia-led group of producers last November, potentially delaying a full recovery of the market until 2018 or even later.

Texas light crude fell $48.90 a barrel on Thursday after yet another surprise jump in US stocks. Prices have slid 8pc in three days and have broken through key levels of technical support, dousing enthusiasm for commodities across the board.

America's shale frackers have slashed cost so far that they can now produce large volumes at a break-even price of $35 or lower in the prolific Permian Basin, the twelve-layered 'crown jewel' of West Texas, where land auctions have reached $60,000 an acre in core zones.

Continental's legendary wild-catter Harold Hamm said drilling is coming back so fast, and on such a large scale, that it threatens to overwhelm the global industry. "We are on something of an equal basis today with OPEC. We need to be careful not to overproduce. It has to be done in a measured way or else we’ll kill the market," he said at the CERAWeek energy forum of IHS Markit in Houston.

The US rig count has almost doubled to 756 since touching bottom last May. The productivity per rig has soared as longer lateral drills, "geological steering", and precision "clustering" triple extraction rates in some sweet spots. The decline rate of the wells has dropped from 65pc to 35pc a year since 2013.

“The consequence has now become alarmingly visible. US crude oil production is growing. And it is growing strongly," said Bjarne Schieldrop from SEB.

Raghdaa Hasan from Statoil said US producers have restored almost all the losses of the slump in just four months, lifting production by over 500,000 b/d. "US shale has proved itself really resilient. They are able to pour significant output into the global system," she said at CERAWeek.

And:

The shale rebound has combined with events in the Middle East to seriously rattle the day-to-day oil markets. The Iraq's oil minister, Jabbar Ali Al-Luiebi, stunned traders with predictions at CERAWeek that his country would lift output by almost a million barrels a day (b/d) to 5m in the second half of this year.

Such an expansion would further flood the global market before it has come close to rebalancing. It is matched by similar rhetoric from Libya, which has already doubled output to 700,000 over recent months and is ultimately eyeing 2.2m b/d.

And:

It had been assumed that the Saudis would do whatever it takes to push oil back up to a band of $60 to $70 in order to smooth the way for a $100bn part-privatisation of the state oil giant Aramco next year, the biggest public offering ever. This is no longer so certain.

Patrick Pouyanné, chairman of the French group Total, said OPEC is going to have to bite the bullet and accept much longer cuts. "The fact is, we still have build-ups in U.S. inventories. If OPEC wants to rebalance the market, then they'll have to extend the agreement. It will take a year to 18 months to really have an impact on inventories," he said in Houston.


David Fuller's view
OPEC’s fragile agreement to cut supplies has fallen apart well before its official review date in June. Short covering and some speculative buying pushed the price of Crude Oil (weekly & daily) temporarily into a range either side of $55 for three months.

However, Russia never delivered its agreed supply cuts. Now everyone in OPEC will increase supplies while prices remain above $40. US shale producers in the Permian Basin, which have never been part of OPEC, are in the strongest position. They can ramp up production very quickly when prices are firm, as we have seen in recent months. Even more importantly, they can reduce output very quickly, when prices are less attractive, while preparing additional wells for the next price rise.

Most oil producers were overly dependent on $100 plus prices which we may never see again. Those with large populations face a rough time, burning through reserves and facing huge declines in their standard of living.

fangorn2
09/3/2017
17:55
Shell sells Canadian oil sands assets for $7.25bn
bountyhunter
09/3/2017
17:51
Oil slide continues as benchmark falls below $49 per barrel
Renewed concerns about supply glut send ripples through currency market...

bountyhunter
08/3/2017
13:13
Budget 2017: Chancellor announces North Sea help

The chancellor has used his budget to outline plans to help the North Sea oil and gas industry.
Philip Hammond will investigate the use of tax incentives to make it easier for operators to sell oil and gas fields, helping to keep them productive for longer.
A panel of experts will be set up to examine the issue.
And a discussion paper on how to help the industry will also be published, Mr Hammond told the Commons.
The Treasury said the moves would further help a vital industry that meets around 50% of the UK's primary energy needs.
It said the measures would build on "unprecedented support already provided to the oil and gas sector through £2.3bn packages in the last three years".
Mr Hammond announced the new help for the North Sea as he outlined a budget that he said was aimed at "building the foundations for a stronger, fairer, more global Britain."
...

bountyhunter
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