Gas and Oil Industry Update: August 2019

Gas and Oil Industry Update: August 2019

Oil prices have been volatile within a fairly tight range in 2019. In many ways, the year has been a recovery from the previous year in which the price plunged in November. Several news events have caused the price to be shaky throughout the year, such as Trump’s tariffs and trade wars, Iran sanctions, and the United States stepping up production on domestic shale oil. Here are some important points to know about gas and oil in August 2019. State of Oil Production A recent Deloitte survey found that executives of oil, gas, and chemical companies were confident about industry growth in 2019. Although the overall market has been volatile during the summer of 2019, investors should take note of the trading opportunities in the $55 to $65 price range of crude oil. The Dow has fallen from its record high this summer mainly as a response to President Trump threatening additional tariffs. These tariffs drive up business expenses even for U.S. oil companies. The oil and gas industries are vulnerable because of the need for specialized steel for refineries. One of the main energy issues in 2019 is sustainability. Several reports are starting to show that renewable energy is beating fossil fuels in cost efficiency. Investors are becoming increasingly interested in sustainability, which affects a corporation’s image and balance sheet. Cutting energy costs is now a top priority among many large corporations. The oil industry now faces tough challenges for competing with solar and wind energy in the future. Keeping up with oil and gas industry news is essential for oil investors. Oil Companies Diversify Several oil and...
Understanding the Shale Boom and Its Effects

Understanding the Shale Boom and Its Effects

The shale boom helped to monetize an important natural resource. There’s always been fossil fuel trapped in shale formations. However, it was always difficult to access. Originally, oil and gas companies had to wait for natural breaks in the rock to make the gas accessible. The development of fracking in the first half of the 20th century made it possible to drill down. Advances in fracking over the past 20 years have made it possible to extract much more. Deeper drilling in hydraulic fracking has meant big things for countries like the United States and Canada. Governments love the idea of accessing these gas and light oil deposits, and it’s easy to see why. The shale boom has taken power from the hands of cartels like OPEC. By knocking them back on their heels, the West is getting closer to true energy independence. However, the big oil and gas companies aren’t thrilled about the shale boom. They haven’t been able to capitalize on it. Because there’s more supply of natural gas and light oil than before, prices are falling. The outlook for the companies hasn’t been that great. Though they’re making a profit, it’s not going as far as they need it to. The shale boom required a lot of investment in new technology. That means taking on some debt. Then 2008 created a recession that was felt the world over, in every industry. It’s also fairly expensive to extract this natural resource. Because the drilling is deeper than ever, it’s also more expensive than it used to be. Paying back the investment that makes this possible will take...
How Could The New Tariffs Affect The Gas And Oil Industry?

How Could The New Tariffs Affect The Gas And Oil Industry?

For many years, Mexico and the United States have had an extremely stable trade alliance. In the last year alone, roughly $345 billion in United States goods were imported into Mexico while Mexico sent $265 billion worth of goods to the United States. Thanks to increasingly high Chinese tariffs, more and more American companies were working with Mexican manufacturing industries. One of the most common forms of trade has been getting raw goods from Mexico to refine them and then ship them back to sell to the Mexican public. Unfortunately, this mutually beneficial relationship seems to be coming to an end. The current government has been threatening to increase tariffs on Mexican imports as a reaction to fears about illegal immigrants. According to Twitter posts from the president, there are plans to put a 5 percent tariff on Mexican imports by June 10 and raise it to 25 percent by October. So far, it is unclear how these tariffs would do anything to reduce illegal immigration. This plan has been met with a lot of concern from economists, with economist Katheryn Russ explaining that these tariffs would mean the United States would essentially be taxing themselves on their goods. The oil and gas industries will be some of the hardest hit industries if these tariffs go into place. The United States currently purchases over 700,000 barrels of crude oil from Mexico each day. Just a five percent tariff would raise costs by $3 a barrel. The higher prices would hurt companies, who would most likely pass on the rise in costs to consumers. As the chairman of Mosaic Resources...
Sustainability Challenges For The Gas And Oil Industry

Sustainability Challenges For The Gas And Oil Industry

The oil and gas industry is such a crucial sector of the global economy and the sustainability of human life. As of 2017, the global dependency on oil and gas sources of energy topped to about 4 trillion cubic meters of the energy resources. With the increased demand comes additional sustainability challenges that threaten to impact the highly demanded production severely. High Risk Of Accidents One thing that clearly defines the oil and gas production sector is the increased threshold of risk to accidents. Oil production companies operate in otherwise risky grounds such as offshore drilling areas in the high seas. The risk of accident in such environments is quite high. Some of the dominant kinds of accidents that have plagued the sector in the past include leakage of toxic oil and gas, leading to severe environmental pollution. Whereas oil mining companies have been on the forefront as far as risk mitigation is concerned, human error has been a major predominant issue which has led to some of the worst oil and gas accidents in the history of the industry. The threshold of such accidents and the potential impacts they have on the environment is so potent that it threatens the sustainability of the entire sector even as environmentalists move on high gear, calling for resourceful utilization of the environment. Straining Of The Existing Resources  The existing resources in terms of deposits of oil and gas, are facing a major constraint in our time. All companies have to increase their production to meet the expanded demand for commodities. In response, the companies have invested in more oil and gas...
What Are The Most Common Uses Of Oil And Gas?

What Are The Most Common Uses Of Oil And Gas?

Most people have heard about the gas and oil industry and how it continues to have a heavy influence on our nation’s economy. What many people may not know though, is how exactly oil and gas are used in our everyday lives currently. Having a strong understanding of the oil and gas industry, and how it is used can give you a better understanding of our economy and how major industries can cause fluctuations. Oil Uses To begin, let’s examine how the United States uses oil, before examining how our continued use is affecting the greater industry altogether. According to the U.S. Energy Information Administration, the top areas that petroleum, which is created from crude oil, is used include transportation, followed by industrial uses. 71% of the petroleum that is used each day in the United States is for transportation purposes. In 2017, approximately 47% of the total petroleum use was for gasoline that is used in people’s cars. While oil is used in a variety of other ways, transportation accounts for a significant portion of the country’s oil consumption. Gas Uses On the other end of the industry is natural gas. Like oil, gas continues to have a significant influence on today’s society. One of the most common and well-known uses of gas is to power homes. Not only does gas provide electricity to homes across the nation, but is also commonly used for daily necessities like kitchen appliances, including the stove and oven. Additionally, gas can be used to heat homes and commercial buildings as needed. Gas has also been used for things like heating water. Outside...
Great Oil And Gas Industry Blogs To Follow

Great Oil And Gas Industry Blogs To Follow

Here in the United States, it’s no secret that oil and gas prices directly affect the health of the economy as a whole. The two major industries are also key to the position of the United States among other countries spanning the globe. Keeping abreast of all the changes occurring in both the oil and gas industries can be hard to follow. Informative blogs are the best way to catch up on emerging and evolving trends. Great Oil And Gas Companies To Follow: ClipperBlog From global crude to refined product movements, the blog provides a unique perspective on analysis, commentary, and comprehensive data sets. Genscape Blog Genscape is a leader in the world’s largest private network of in-field monitors. The company offers unsurpassed market intelligence across the energy scope. RBN’s Daily Energy Post Here’s another excellent blog that posts at 5:00 am central time each business day. The blog focuses on energy market trends, the mechanics of how these markets function and more. Oilholics Synonymous Report Financial writer Gaurav Sharma boasts an extensive resume in both the oil and gas industries. He has vast experience covering OPEC summits, energy events, analysis of oil corporations’ financials and exploration data. Today In Energy From The EIA The U.S. Energy Information Administration (EIA) provides a wealth of information to the media regarding energy production, stocks, demand, imports, exports, and prices. The RigUp Blog The Austin, Texas-based company has emerged as the biggest marketplace and provider of labor in the energy industry. The blog tackles a variety of topics like “5 Fun Facts About the Permian Basin.” Oil And Gas Lawyer Blog Texas...
How Has The Oil And Gas Industry Started So Far This Year?

How Has The Oil And Gas Industry Started So Far This Year?

The oil and gas industry can go from being consistent in being sporadic in an instant. Prices of crude oil can plummet or skyrocket overnight because so many countries have involvement in the industry. One country’s actions could have effects on the entire world. 2019 is off to a good start for most oil companies. For example, BP posted large profits for the fourth quarter of 2018; their 2018 replacement cost profit was $12.7 billion for the entirety of 2018. Bob Dudley, chief executive of BP, said: “This is a really good quarter, and, actually, the end of a great year for us.” He explained to CNBC that his company had doubled earnings and returns from 2017. As a result of his announcement, BP shares rose by 3% earlier in February. BP’s 2018 fourth-quarter was a 65 percent increase from 2017’s fourth quarter. This can partially be attributed to the acquisition of BHP’s U.S. shale properties and assets. Dudley is predicting an excellent 2019 for the oil and gas industry. He explained to CNBC that he expects oil prices to remain between $50 and $65 this year. The price of crude oil isn’t the only thing that determines a successful year for the oil industry though. The sudden drop in oil prices in December already has many companies rewriting their 2019 projections, but there are other things they must consider as well. There is currently a pipeline capacity bottleneck in the Permian Basin. However, some experts believe that this issue will be resolved by the end of the year. Despite this, profits are expected to break records within the...
What Are The Different Gas And Oil Industries?

What Are The Different Gas And Oil Industries?

The oil and gas industry are coming into more focus as a result of recent changes, and it does not show a major sign of evening out soon. The gas and oil industry is broken up into three components, with each component counting for a major source of energy that helps to fuel the world that we live in today. The three components include the upstream industry, the midstream industry, and the downstream industry. While many know about the gas and oil industries, they may not understand how each component is used for fuel. With that in mind, let’s examine what the three components of the gas and oil industry. Upstream Industry To begin, the upstream industry is the component that searches for crude oil and natural gas through underground or underwater fields. Essentially, it is the component that uses different approaches to find the necessary oil and gas. Because of how unpredictable the wells that are used to retrieve the oil and gas, this component is considered to be the most difficult, and overall dangerous approach. However, it continues to be in high demand in today’s economy. Midstream Industry Once the oils and recovered from its respective location, the midstream industry helps to store and distribute the items. Some of the processed items include crude oil, natural gas, and sulfur. In general, the midstream industry is considered to be fairly safe, as they work to store the gas and oil until it is transported to locations that will determine where it will be distributed and utilized. Downstream Industry The downstream industry represents the final processing of the products,...
What Does The Oil And Gas Industry Look Like Right Now?

What Does The Oil And Gas Industry Look Like Right Now?

While there’s a lot of talk about green energy sources like wind and solar power, the simple truth is that we aren’t going to be moving exclusively towards these options right away. Moving towards renewable energy is going to require a transitional period where more traditional energy helps fill the gap. And despite a push towards green energy, the oil and gas industry is currently experiencing a boom. Where OPEC once largely held a monopoly on energy resources, the United States has been aggressively forcing its way into the market. It’s a change largely unprecedented. 2018 was the first time in 75 years that the United States could be seen as a net exporter of petroleum liquids. Between November 20 and December 5, the country exported more of these goods than they imported. That’s a good sign for the industry, but it’s equally important because it indicates that the U.S. has reached a point where they aren’t dependent on other nations to provide them with their energy needs. These numbers cover both crude oil and oil-derived liquids. The latter covers a wide range of different substances ranging from gasoline to diesel. All told, the discrepancy between barrels imported and exported was 211,000. That provision is important. While America is making major moves towards becoming energy independent, it’s unlikely that we’ll be able to sustain ourselves on domestically produced crude oil alone anytime soon. But that’s not a change that should be underestimated. This change has been unprecedented for three-quarters of a century, and it’s a tide shift from a decade ago. These shifting circumstances are largely predicated on our...
Top 3 Leading Companies of the Oil & Gas Industry

Top 3 Leading Companies of the Oil & Gas Industry

In 2016, Forbes brought together a list of the top leading companies of the oil and gas industry. Today, we will explore the top 3 biggest in the world. We will explore the details and differences of these companies, but it’s very clear why they are the top 3. 1. Gazprom Gazprom’s main trade is in natural gas and other energy resources. Holding the world’s largest natural gas reserve, Gazprom is also the largest importer of natural gas to the European market. This booming company in the industry strives to transport natural gas and other energy resources to their customers. Gazprom also has a high involvement in Russia, selling more than half of their gas to Russian consumers. This company is the only producer of Liquefied Natural Gas in Russia. Gazprom’s CEO Alexey Miller is an extremely powerful influencer in the world, and accounts for nearly 13% of world production. 2. Rozneft In terms of oil and gas production, Rozneft is the leading producer of petroleum in Russia, although they are a global company. As the deliverer of over 40% of oil to Russia, Rozneft has climbed the uphill battles of the economy and crises over the past. Being aware of the environmental ethics to the oil industry, Rozneft has a sustainable development policy which the company adheres to. Among that policy is the objective to regulate and unify activities pertaining to sustainability. The company will report its first quarter of 2017 financial results, Friday, May 5. 3. Exxon Mobil Depending on where you’re located, you may be more familiar with Exxon Mobil. With gas stations in 47 states...