December 2010 Archives

As we turn the corner on the millennium's second decade, one thing industry might be thankful for is that the late 1980s and its low oil prices are history. That might also be said  of other grody-to-the-max 1980s trends like break dancing, frizzy big-haired rock bands, fashion leg warmers and fingerless lace gloves.

This, apparently, is what pollsters talk about when they try to do a truly "random" sample. Randomness is why you can pull off a legitimate sample that is supposed to take the pulse of, say, the entire United States, when you only seek the opinions of 1,200 people. 

We did our annual survey of the top 10 oil stories of 2010. We didn't put the entire Macondo story under one heading; there were simply too many aspects to it, so we split it into several.

Platts Director of oil John Kingston was asked to appear on CNBC's Squawk Box today. With oil above $90, the topic of discussion wasn't too surprising. You can see it here.

One of the reasons for this week's reported decline in crude oil inventories is said to be tax-related, so this is a good time to remind our readers about some recent commentary on the issue done by Allison Ciaccio. You can find it here. 

This week's broader analysis of the statistics can be found here.

A few last-minute gift ideas for the Haynesville Shale zealot in your life:

There's "Haynesville: The Movie," out on DVD now and a flic that seems to offer a perspective distinct from the raging hit Gasland, a film critical of hydraulic fracturing. Other possibilities from the Go Haynesville Shale Gift Shop are a jersey that says "Haynesville Shale: You light up my life" and a mug with the same message, both with a backdrop of a lit flame.

The most optimistic forecast at the recent Cancun, Mexico, climate summit came from conference president Patricia Espinosa who predicted midway through the second week of the two-week conclave that it would conclude as scheduled that Friday, at 6 pm local time, December 11.

The meeting was gaveled to a close at 6:35 am, EST, Saturday.

A few thoughts on some stories from today, as we head toward this final shopping weekend before Christmas, and US drivers complain about gasoline in excess of $3/gal, while steering their 11,000 pound Dodge Ram pickups into the mall's parking lot. A couple of things you may have missed today:

US crude oil stocks plummeted 9.854 million barrels to 346.018 million barrels as refinery inputs held steady the week ending December 10. This came as imports plunged, and after data for the week ending Dec. 3 showed a huge jump in refinery inputs, as end-of-year tax considerations kicked in, an analysis of the oil data released Wednesday by the Energy Information Administration (EIA) showed.

This analysis and commentary is provided by Linda Rafield, Platts senior oil analyst and editor of the weekly Futures and Derivatives Review, a supplement to Oilgram Price Report.

Read the full analysis here.

Platts' chief China correspondent Calvin Lee recently wrote about the development of a new type of fuel in China. It's been dubbed "power kerosene," and it shows the endless creativity that Chinese commercial players will use to meet the country's needs.

His story appears below:

Just weeks after the popular, if divisive, television show Lost wrapped up its six-year run last summer, President Obama signed landmark financial regulatory reform into law.

This may not be a simple coincidence.

Talking to Bill Colton, it's not hard to draw a straight line from Exxon's acquisition of Mobil in the late 90's to ExxonMobil's purchase of shale natural gas giant XTO earlier this year.

Colton, the company's vice president of corporate strategic planning, is rumored to be the person who whispered "gas" in ExxonMobil CEO Rex Tillerson's ear, convincing the company to spend $41 billion, including assumed debt, to make a giant splash in shale gas with the XTO purchase. (It was announced in late 2009 and closed this year).

A Martian dropping into Quito would probably be somewhat baffled by some of the comments made by ministers on the sidelines of OPEC's just-ended meeting in the Ecuadorean capital.

This alien might hear Saudi Arabian oil minister Ali Naimi describe a range of $70-$80/barrel as "a good price" for oil. He might have already heard OPEC secretary general Abdalla el-Badri say earlier this week that OPEC would not pump more oil if prices climbed to $100/b.

The International Energy Agency issued a guarded warning for OPEC to start loosening its output quotas December 10 as recovery the US continues to outpace expectations and Chinese growth remains buoyant.

In its latest monthly report, the IEA raised its forecasts for global oil product demand next year for the third month in a row, and said OPEC should probably now start taking stock of the upward revisions.

Bleary-eyed reporters wander the lobby of the Swissotel in Quito, some still grappling with fear of "soroche," the Quichua word for altitude sickness, and  jet lag after flying in from the four corners of the globe to attend OPEC's final meeting of the year.

Ecuador, OPEC's smallest oil producer at around 500,00 b/d, withdrew from the cartel in 1992 to avoid export limitations but rejoined in 2007 and is marking the end of its one-year presidency of the organization with a ministerial conference.

Refineries ramped up strongly in the last week, and it showed in this week's Energy Information Agency's weekly statistical report. It showed not only in a big unexpected drop in crude imports, but also a big increase in gasoline stocks, and for distillates as well.

Read Platts' analysis here.

There's been a lot of numbers thrown around by industry lately concerning the dearth of offshore US well permits. And some of them can be confusing.

The figures cited usually aim at proving the snail's pace of new wells green-lighted by the US government since, as opposed to before, the blowout at the BP-operated Macondo well in the Gulf of Mexico. The accident not only caused the country's biggest marine oil spill but in stricter new safety regulations and slowed down permit approvals. But the numbers of well permits variously claimed are frequently inconsistent.

As WTI nears $90, and Brent's already there, consumers did not need this: OPEC cut its output last month.

According to the Platts' survey, OPEC cut its output just as demand is showing significant signs of growth around the world, pumping out 29.1 million b/d in November, That's down 70,000 b/d from a month earlier, during the quarter where demand is the heaviest and the inventory draw the most significant.

That decline puts OPEC output at less than the full-year 2011 call on OPEC crude estimated by the International Energy Agency.

Canada's Business News Network (BNN) talks to John Kingston, global director, news, Platts, about Platts' annual global energy forum and the feasibility of clean energy.

Click here to watch the video.

The Australian upstream oil and gas industry is adamant it is not in a public relations battle with environmental and landholder lobby groups opposed to the rapidly expanding east coast coalseam gas industry.

"The rapid development of our industry is being used by anti-industry activists to generate publicity, but this does not equate to a 'PR battle'," Australian Petroleum Production & Exploration Association Chief Executive Belinda Robinson told Platts after a recent run of bad publicity.