Oil demand in the US soared during the summer, even as higher pump prices forced many Americans to cut back on driving.

Overall petroleum supplied, a proxy for demand, posted its best July since 2019, according to government data released Friday. June was even stronger, with demand for the month at a 16-year high. The boost came despite a marked drop in gasoline consumption, which fell 6% from a year ago and double June’s decline.

The shocks of high gasoline costs are ricocheting through the economy, and industry analysts see little relief on the horizon. Crude oil, the natural resource used to produce gasoline and diesel fuel, has seen dramatic changes to its supply throughout the pandemic.

The onset of the pandemic led to an initial drop in prices for petroleum-based products, and then, just as abruptly, prices rose sharply

Demand has started to fall by single-digit percentage points in parts of the country where gasoline prices have hit the highest. As petrol prices continue to break records in the United States, putting a significant strain on Americans‘ wallets and threatening economy.

Oil and gas will continue to remain a significant part of oil-producing countries’ energy mix. The need for energy grows every year. With that, this will ensure global energy security in line with the green shift in mind as experts say.

The UAE was seeing record growth in renewables. This is what Sultan Al Jaber said. He is the United Arab Emirates’ special envoy for climate change and minister of industry and advanced technology

But while wind and solar accounted for most of the new power generation capacity last year, he said this still only comprises 4 percent of today’s energy mix.

“A successful energy transition must progress with economic and climate action in tandem. As part of this, we know we must do more now to reduce the impact of oil and gas on the climate,” he said.

In its monthly oil market report published on Sept 13, the Organization of the Petroleum Exporting Countries reported that world oil demand growth in 2022 remained unchanged from the previous month’s assessment “at a healthy level of 3.1 million barrels per day”.

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Source: Hellenic Shipping News

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Two years ago, oil and gas companies in Texas were laying off employees. This is amid the most severe downturn in the industry’s history. This year, job growth in America’s oil and gas heartland has been so strong. As a result, labor shortages have prevented the industry from expanding.

According to the latest data, Texas added 2,600 new oil and gas jobs in August in the upstream sector. That was a decline from July when the upstream industry added 3,100 new jobs. Still a robust number and the latest proof that oil and gas companies are over the pandemic.

“Upstream employment is growing steadily alongside the world’s demand for affordable, reliable energy. The Texas oil and natural gas industry continue to play its leadership role in enhancing national and energy security in our nation and for our trade allies around the world,” said the president of the Texas Oil and Gas Association, commenting on the numbers released by the Texas Workforce Commission.

The data shows that since September 2020, the trough of the latest downturn, the upstream industry in Texas has added jobs at an average monthly rate of 1,943, for a total of 44,700 jobs added over the past two years. As of August, the total number of people employed by Texas upstream businesses stood at 201,700.

Upstream oil and gas employment is growing strongly in New Mexico as well: Texas and New Mexico share the Permian basin, seen as the top performer in the U.S. shale patch. The New Mexico Department of Workforce Solutions expects employment in that sector to expand by 10.8 percent by 2028.

 

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Source: Oil Price

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Production taxes paid by the Texas oil and natural gas industry topped $10 billion in fiscal 2022. This is the highest amount the industry has paid in Texas history.

The fiscal record was reported after the industry has broken records nearly every month this year in both the number of jobs added and the record amount of taxes paid.

According to the most recent data published by the state comptroller’s office, production taxes paid by the oil and natural gas industry totaled $10.83 billion for fiscal 2022.

Both oil and natural gas production taxes exceeded the annual revenue estimate prepared earlier this summer by the comptroller’s office.

Oil production tax revenue was $6.36 billion, up 84.4% from fiscal 2021. Natural gas production tax revenue was $4.47 billion, up 185% from fiscal 2021. Both totals exceeded their projected estimates by over $134 million and $9 million, respectively.

The industry paid 88% more in 2022 than it did during its previous highest year in 2014.

The record amount of taxes paid by the oil and natural gas industry fund two key expenses: the Economic Stabilization Fund (Rainy Day Fund) and State Highway Fund. The Rainy Day Fund has been used to fund public K-12 and higher education needs, retired teachers, and state police funds, in addition to other services in Texas.

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Source: Santa Barbara News Press

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In a historic achievement, President Joe Biden signed into law the Inflation Reduction Act (IRA) on August 16, 2022.

This bill, was recently thought to be on life support with very little chance of congressional passage. It is a sprawling piece of legislation. Also, it lowers prescription drug costs for those covered by Medicare and raises taxes on large corporations. It also represents the largest climate investment in American history. A preliminary assessment was done by the Rhodium Group. It estimates that it can reduce net U.S. greenhouse gas emissions to 31%-44% below 2005 levels by 2030, as compared to 24%-35% under current policy. According to the White House, the IRA will also reduce the deficit by hundreds of billions of dollars.

Specifically, it will raise over $700 billion in revenue for the federal government over the next 10 years, some of which will be put toward paying down the national debt and some of which will go toward lowering carbon emissions and extending subsidies for health insurance under the Affordable Care Act.

Among the mountain of provisions in the IRA is also language that reforms the oil and gas industry for the first time in decades. As POGO has been advocating for since the 1990s, it is imperative that the administration, specifically the Department of the Interior, take meaningful steps to ensure that U.S. taxpayers are paid their fair share for industry’s use of public lands.

Here’s our take on the good and the bad. Learn more when it comes to the oil and gas provisions in the IRA.

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Source: POGO

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