Following last week’s price rally, oil prices move higher on Monday morning, on bullish demand figures coming from China. Additionally, U.S. dollar weakness contributed to last week’s price rally. Traders are also expecting deeper OPEC+ cuts of 1.15 million bbl/d in August and September. As a result, Brent crude traded above $46 which was mainly driven by the supply disruption triggered by the hurricanes in the Gulf Mexico, which affected around 84% of the USGC production where around 1.7 million bbl/d remain offline.

Laura, a category 4 hurricane made landfall early Thursday last week, in the Southwestern part of Louisiana. becoming one of the most powerful storms in history to hit the state. More than 310 offshore platforms, out of 643, were evacuated in addition to nine refineries leading to a 2.7 million bbl/d outage, around 15% of the US refining capacity. Furthermore, initial reports reveal that the damage caused to the refineries is minor, but continuing power outages could delay the resumption of refining operations.

Click here to read the full article.

Source: Oil Price

The double negatives of a demand-culling pandemic and wildly declining sentiment trouncing the oil and gas. It is also pushing companies to record lows, with $30 billion in collective debt, trying to pick a winner in this sector is growing more challenging by the day. Oil boom is really coming.

On the demand front, the IEA has just cut its 2020 oil production forecast by 140,000 BPD to 91.9 million BPD, sending the FTSE 100 index down 73 points, citing the airline industry’s troubles as a key source of weakness in the oil market.

But the megatrend of ESG, or “impact” investing, is the wider threat to the oil and gas industry, with energy stocks finding themselves in the penalty box due to heightened concerns about ever-rising carbon emissions and poor governance. It’s all prompting capital to flee the sector at an unprecedented rate—even faster due to the pandemic.

The energy sector has been the worst performer in the S&P 500, gaining just 34% over the timeframe according to Refinitiv data. And in the three-month period to June, Big Oil posted massive losses as the demand shock set in.

Click here to read the full article.

Source: Oil Price

If you have further questions about Oil Boom, feel free to contact us here.

Bank of America expects oil prices to recover to $60 a barrel for Brent crude in the first half of next year thanks to shrinking global inventories and prices improving faster than previously expected.

“Back in June, we upped our oil price forecasts by $5 per barrel (/bbl) and argued that Brent would average $43/bbl in 2020 and $50/bbl in 2021,” Bank of America’s analysts said as quoted by Trade Arabia.

However, since then, oil futures have been rising faster than expected even though spot prices remained range-bound, the bank noted. Because of this and because it expects an oil market deficit of 4.9 million BPD for the second half of this year and another of 1.7 million bpd next year, BofA expects prices to shoot up.

The bank’s analysts noted the slump in drilling rigs, notably in the U.S. shale patch, and the OPEC+ oil production cuts as some of the main factors that would push the oil market into a deficit and prop up prices.

However, the demand side remains a downward pressure for prices. The IEA and OPEC were the latest to sound a cautious note in their respective monthly reports. The IEA said it expected oil demand this year to be down 8.1 million bpd from last year, while OPEC estimated a demand loss of 9.1 million bpd this year.

Click here to read the full article.

Source: Oil Price

If you have further questions about the Bank of America oil prices updates, feel free to reach out to us here.

The U.S. Environmental Protection Agency (EPA) expects to finalize and sign this week new rules about methane emissions for the oil and gas sector, including putting an end to requirements that companies have systems in place to detect methane leaks, senior administration officials told The Wall Street Journal.

The EPA has proposed updating the Obama administration’s rules on methane emissions and detection.

Last year in August, the EPA proposed updates to the air regulations for the oil and gas industry in order to “remove regulatory duplication and save the industry millions of dollars in compliance costs each year – while maintaining health and environmental regulations on oil and gas sources that the agency considers appropriate.”

Click here to read the full article.

Source: Oil Price

Gas utility company Southern California Gas Co is suing the California Energy Commission. It is over the state’s climate policy and attempts to phase out natural gas as a source of heating and cooking.

Southern California Gas Co, owned by Sempra Energy, is trying to shield itself from policy actions. This could ban the hook-up of natural gas for all new homes.

The California Energy Commission, for its part, is promoting building efficiency and emissions-cutting rules for new construction, encouraging home developers to build all-electric buildings in the state.

For example, last year, Berkeley, California, passed an ordinance requiring all new homes to be all-electric. Meaning no gas hook-ups beginning in January 2020. Berkeley’s primary motivation for the gas hook-up ban was to reduce greenhouse gas emissions. They want to promote the use of clean energy.

Climate activists say that natural gas is a fossil fuel and is responsible for a large part of emissions from buildings, while natural gas companies are pitching natural gas as an affordable and stable ‘bridge’ fuel toward all-renewable electricity generation.

“Natural gas and renewable gas are clean, affordable, resilient, and reliable sources of energy on which millions of California consumers and businesses depend,” Southern California Gas Co said in its lawsuit, as carried by the Los Angeles Times.

 

Click here to read the full article.

Source: Oil Price

If you have further questions related to any Gas Utility entities, feel free to contact us here.