.The Texas Energy Report

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.The Texas Energy Report

API Welcomes OPEC+ Agreement To Cut Global Oil Production: press release

April 12, 2020

American Petroleum Institute President and CEO Mike Sommers today issued the following statement regarding the announcement of a historic OPEC+ agreement to cut global oil production beginning in May.

“We welcome today’s announcement of an agreement by other producing nations to follow the lead of the global marketplace – and U.S. producers – to reduce supply to align with lower energy demand as result of the pandemic. This is a significant agreement that will foster increased stability in energy markets to the benefit of both American energy consumers and producers. We commend the president’s leadership and his administration’s diplomatic engagement to urge nations to bring global oil supply in line with the lower energy demand as a result of the pandemic.

“In the U.S., market conditions have led U.S. producers to reduce U.S. oil production to meet historic drops in demand. While the U.S. today leads the world in daily oil production, oil is produced, refined, used and traded across the globe, and most of the world’s oil is produced by foreign government owned entities – some of whom announced oil production increases last month just as global energy use was decreasing due to the pandemic…..
 

OPEC, Others Agree On 10M BPD Cut: Reports

April 12, 2020

OPEC, Russia and other oil-producing nations on Sunday finalized an unprecedented production cut of nearly 10 million barrels, or a tenth of global supply, in hopes of boosting crashing prices amid the coronavirus pandemic and a price war, officials said.

“This could be the largest reduction in production from OPEC for perhaps a decade, maybe longer,” said U.S. Energy Secretary Dan Brouillette, who credited President Donald Trump’s personal involvement in getting dueling parties to the table and helping to end a price war between Saudi Arabia and Russia. (AP)….
 

Oil Inventories Increase, Storage Near Capacity

EDITOR’S NOTE: OPEC members and other participating countries are scheduled to meet to discuss future oil production quotas, and the deadline for this column is Thursday. There were reports early Thursday that Russian officials said Russia is ready to cut oil production by 1.6 million barrels per day. If accurate, it indicates that other countries will agree to cut also.

 

By Alex Mills

Even though crude oil prices rebounded about 15 percent this week, oil inventories continued to rise as energy demand and economic conditions declined.

Spot crude oil prices closed at $25.09 on Wednesday at Cushing, OK, and posted prices for North and West Central Texas closed at $20.25 for most purchasers, according to crude oil prices posted on the web page of the Texas Alliance of Energy Producers.

However, many oil producers in Texas have been told by their current purchaser that they will not be purchasing their oil after May 15 because inventories and storage capacity are very tight.

The Energy Information Administration (EIA) reported Wednesday U.S. oil inventories increased for the ninth consecutive week since Jan. 17 to 469 million barrels, which is a 15.2 million barrel increase from the previous week.

“Prices for RBOB gasoline futures have collapsed, and some refineries have even faced negative margins for selling gasoline,” Oilprice.com reported. “That is a reflection of the deep decline in demand. Price signals are telling refineries to cut back on production. U.S. gasoline demand fell from 8.837 million barrels per day (b/d) on March 20 to 6.659 million b/d on March 27.”….
 

ExxonMobil Joins COVID-19 Fight, Helping Develop Multi-Use PPE For Clinical Settings: Report

April 8, 2020

ExxonMobil and the Global Center for Medical Innovation (GCMI) have initiated multi-sector and joint development projects to rapidly redesign and manufacture reusable personal protection equipment for health care workers, such as face shields and masks, which are in short supply as a result of the COVID-19 pandemic….
 

Crashing Oil Prices and Equity Market Volatility Grind Energy Deals to a Halt: Enverus

April 5, 2020

Oil and gas and data analytics company Enverus has released its Q1 summary of M&A activity, which revealed a substantial collapse as oil prices plunged to 18-year lows. Only $770 million in U.S. upstream deals were completed during the first quarter of 2020—less than one-tenth of the ~$8 billion average for Q1 from 2010-2019. Virtually all deal activity occurred before the global COVID-19 pandemic and production hike from Saudi Arabia slammed markets in early March…..