November 21, 2018

November 21, 2018

21st November 2018

Oil Drilling Activity

Onshore US drilling activity decreased 6 with a total active count of 1052 rigs; those targeting oil decreased 3, with the total at 885. Across the three major unconventional oil basins, the oilrig count decreased 2 and stands at 618, with Permian flat, Eagle Ford and Williston down 1. 

Sources: EIA Weekly Update and GCA Analysis

EIA reported last week’s total US domestic crude output flat at 11.7 million barrels.

Lower energy prices could begin to affect the US economy by inhibiting investment in shale oil production. Falling investment in new rigs in oil producing US states could affect overall US economic growth. The key point is that lower oil prices are now a drag on the US economy.

Natural Gas & Crude Oil – 

            Will return next week… Happy Thanksgiving!

Weekly Recap

Drilling Activity

Source: BHGE Rotary Rig Count

Total US rig count (including the Gulf of Mexico) stands at 1079, down 3 this week. The horizontal rig count stands at 929, down 10 this week. US rig activity continues to show constrained growth for 24 of the last 27 weeks and stands 17% above last year’s total.

Crude Oil Price

Brent, the global benchmark for oil, decreased US$4.71 to US$63.37 a barrel, reflecting a loss of 6.92% on the week.

WTI crude fell US$3.20 to US$54.37 a barrel, down 5.56% on the week.

US Crude Oil Supply and Demand

Sources: EIA Weekly Update and GCA Analysis

US crude oil refinery inputs averaged 16.9 million barrels per day, with refineries at 92.7% of their operating capacity last week. This is 423,000 barrels per day more than the previous week’s average.

US gasoline demand over the past four weeks was at 9.2 million barrels, down 2.6% from a year ago. Total commercial petroleum inventories decreased by 0.2 million barrels last week.

US crude imports averaged 7.6 million barrels per day last week, up by 102,000 barrels per day from the previous week. Over the past four weeks, crude oil imports averaged 7.5 million barrels per day, 2.7% less than the same four-week period last year.

US crude exports averaged 1.969 million barrels per day last week, a decrease of 81,000 barrels per day from the previous week. Over the last four weeks, crude oil exports averaged 2.227 million barrels per day, 55.7% more than the same four-week period last year.

Crude oil inventories increased 4.9 million barrels from the previous week. The crude stored at Cushing (the main price point for WTI) decreased 0.2 million barrels; total stored is 35.3 million barrels (~39% utilization).

   

Authors

November 21, 2018

P. Kevin Galvin

Principal Advisor - Sr. Manager Facilities/Cost Engineering Advisor - kevin.galvin@gaffney-cline.com

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