December 6, 2011 Energy Data Highlights Retail gasoline price 12/5/2011: $3.290/gal down$0.017 from week earlier up$0.332 from year earlier Retail diesel price 12/5/2011: $3.931/gal down$0.033 from week earlier up$0.734 from year earlier Crude oil futures price 12/2/2011: $100.96/bbl up$4.19 from week earlier up$12.96 from year earlier Natural gas futures price 12/2/2011: $3.584/mmBtu up$0.042 from week earlier down$0.759 from year earlier Weekly coal production 11/26/2011: 20.807 million tons down0.411 million tons from week earlier up0.324 million tons from year earlier Natural Gas/ Power News EIA Storage Release 11/23/11 (Actual): -1 BcfPrevious Week: +9 Bcf+1.1% Change from 1 Year Ago +7.3% Change 5-year Average Shale-Gas Drilling to Add 870,000 U.S. Jobs Producing natural gas from shale will support 870,000 U.S. jobs and add $118 billion to economic growth in the next four years, according to a report from IHS Follow
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Oil Recovers on Speculation Impact of S&P Ratings Reviews May Be
Limited
Oil traded near its highest in three weeks in New York, recouping earlier losses as
a surge in German manufacturing tempered concerns that Standard & Poor’s may
downgrade the credit ratings of European nations. West Texas Intermediate was
little changed after recouping a loss of 0.6 percent. German factory orders rose
the most in 19 months in October after three straight declines. Standard & Poor’s
said yesterday it may strip Germany and France of AAA credit ratings as it weighsdowngrades for 15 nations. U.S. gasoline and distillate stockpiles rose last week
while crude supplies shrank, according to a Bloomberg News survey.
Spread between WTI and Brent prices narrows on signs of easingtransportation constraintsBetween October and November, the spot price of West Texas Intermediate (WTI)crude oil increased $23 per barrel partly on signs that transportation constraintsout of the U.S. Midwest, the main market for WTI, are beginning to ease. At thesame time, the price of European benchmark Brent crude oil was up much less,only about $7 per barrel. As a result, the WTI-Brent crude oil price difference hasnarrowed. The WTI-Brent crude oil price difference was smaller earlier in the year.While the WTI-Brent oil price narrowed, gasoline prices continue to track the price
of Brent as they have for much of the year. The average price for gasoline moved
about 6 cents a gallon from early October through mid November and then fell 13cents during the last two weeks of November.http://www.eia.gov/todayinenergy/detail.cfm?id=4170
Big Oil Heads Back Home
Big Oil is redrawing the energy map. For decades, its main stomping grounds werein the developing world—exotic locales like the Persian Gulf and the desert sands
of North Africa, the Niger Delta and the Caspian Sea. But in recent years, that
geographical focus has undergone a radical change. Western energy giants are
increasingly hunting for supplies in rich, developed countries—a shift that could
have profound implications for the industry, global politics and consumers.
Driving the change is the boom in unconventionals—the tough kinds of
hydrocarbons like shale gas and oil sands that were once considered too difficult
and expensive to extract and are now being exploited on an unprecedented scale
from Australia to Canada. The U.S. is at the forefront of the unconventionals
revolution. By 2020, shale sources will make up about a third of total U.S. oil and
gas production, according to PFC Energy, a Washington-based consultancy. By
that time, the U.S. will be the top global oil and gas producer, surpassing Russia
Oil's Growing Thirst for Water Water has always been a concern for 65-year-old Joe Parker, who manages a
19,000-acre cattle ranch here in South Texas. "Water is scarce in our area," he
says, and a scorching yearlong drought has made it even scarcer. What has Mr.
Parker especially concerned are the drilling rigs that now dot the flat, brushylandscape. Each oil well in the area, using the technique known as hydraulic
fracturing, requires about six million gallons of water to break open rocks far
below the surface and release oil and natural gas. Mr. Parker says he worries
about whether the underground water can support both ranching and energy
Russian Oil Frontier: Nowhere Land There's the middle of nowhere, and then there's here. The place isVerkhnechonsk, an oil field in eastern Russia operated by TNK-BP Ltd. that is oneof the remotest spots on the planet. To get there you have to fly to Siberia, takean aging turboprop plane deep into the taiga, or subarctic forest. Then hop on ahelicopter heading north. From Moscow, the journey takes a day, includinglayovers—longer if there are snowstorms. It is so far from anywhere that TNK-BP,a joint venture of BP PLC and a group of Soviet-born billionaires, runs operationsvia video link from an office in Irkutsk, some 600 miles away. "It's like living on anisland," says Albert Gilfanov, the oil field's deputy manager. Russia is an energysuperpower, with 13% of the planet's oil resources and a quarter of its natural gas.Having declined steeply after the collapse of the Soviet Union, oil production has
come back strongly, hitting a new post-Soviet high of 10.3 million barrels a day in
October. Yet the mainstay of Russia's hydrocarbon wealth—the big Soviet-era oilfields of Western Siberia—is in decline. To keep production stable, Russia has nochoice but to expand into new areas like Eastern Siberia—where oil reserves areless plentiful, production costs higher and the logistical challenges mind-boggling.http://online.wsj.com/article/SB10001424052970203764804577060200073674124.html?mod=WSJ_Commodities_LeadStory
Brazil acts fast to clear up oil spillsIt was about a month ago when Chevron workers first noticed small bubbles of oil
emerging through cracks in the seabed near one of their wells, 230 miles off the
coast of Rio de Janeiro. Over the next four days, those bubbles spewed more than
2,000 barrels of oil into the Atlantic, leading to a temporary ban of the US
company, a police investigation, millions of dollars in fines, the shutdown of
another of its wells and now threats of regulatory change in one of the world’s
most promising oil industries. Speaking to the Financial Times, Carlos Minc, Rio’s
environment secretary and the country’s former environment minister, says he is
now pushing for tougher rules for companies looking to profit from Brazil’s oil
boom. “We may be a tropical country but we’re not a ‘banana republic’,” he says.“Everyone wants to come to Brazil and if we’re not strict with [Chevron], this place
Paris and London to press EU for Iran oil banFrance and the UK will use a gathering of European Union leaders this week topush forward their plan to approve a full embargo on oil imports from Iran. Themeeting will be dominated by efforts to shore up the single currency. Butdiplomats in Brussels say France is also pushing to use the occasion to advance itscase for strong measures against Iran over its nuclear weapons programme. EUforeign ministers agreed last week to start work on a ban, with the aim of imposing sanctions at their next meeting in January, in a move that could putsignificant new pressure on Tehran’s foreign currency receipts. British and Frenchdiplomats say Greece, which receives between 25 and 30 per cent of its oil fromIran, is the only state raising serious objections to a ban on Iranian oil imports butthose objections should be overcome by the January meeting. http://www.ft.com/intl/cms/s/0/823241ca-1f5b-11e1-ab49-
00144feabdc0.html#axzz1flBF0c5J
Oil rises above $101 as Iran tensions rise
Oil prices rose above $101 a barrel Monday in Asia amid growing tensions
between Iran and Western powers and signs the U.S. economy is improving.
Benchmark crude for January delivery was up 50 cents to $101.46 a barrel at
midday Singapore time in electronic trading on the New York Mercantile
Exchange. The contract rose 76 cents to settle at $100.96 on Friday.