gasoline imports at a 6 month low; DUC backlog at 5.1 months as both well drilling and well completions fall

oil prices fell for just the 2nd time over the past twelve weeks on the expiration of trading of the higher priced October oil contract, as the Fed telegraphed that interest rates would remain higher for longer, the UAW expanded their strike to target GM and Stellantis plants nationally, and Congress was unable to agree on a resolution to continue funding the government past September 30th...the widely quoted contract price for US crude for November delivery ended the week at $90.03 a barrel, down from last week's October oil closing quote of $90.77 a barrel, but up a penny from the last quote for November oil a week ago...

similarly, natural gas prices were little changed, with October natural gas finishing at $2.637 per mmBTU, less than a penny lower than last week's closing price of $2.644 per mmBTU, as early gains on weak production and robust LNG exports were ​later reversed in the face of bearish weather reports and planned pipeline maintenance.​.

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending September 15th indicated that even after a big drop in our oil refining, a bigger decrease in our oil imports and an even bigger increase in our oil exports meant we had to pull oil out of our stored commercial crude supplies for the eighth  time in ten weeks, and for the nineteenth time in the past 39 weeks, even after a big jump in oil supplies that the EIA could not account for....Our imports of crude oil fell by an average of 1,065,000 barrels per day to 6,517,000 barrels per day, after rising by an average of 812,000 barrels per day to a four year high the prior week, while our exports of crude oil rose by 1,977,000 barrels per day to average 5,067,000 barrels per day, which combined meant that the net of our trade in oil worked out to a net import average of 1,450,000 barrels of oil per day during the week ending September 15th, 3,042,000 fewer barrels per day than the net of our imports minus our exports during the prior week. Over the same period, production of crude from US wells was reportedly unchanged at a forty-one month high of 12,900,000 barrels per day, and hence our daily supply of oil from the net of our international trade in oil and from domestic well production appears to have averaged a total of 14,350,000 barrels per day during the September 15th reporting week…

Meanwhile, US oil refineries reported they were processing an average of 16,304,000 barrels of crude per day during the week ending September 15th, an average of 496,000 fewer barrels per day than the amount of oil that our refineries were processing during the prior week, while over the same period the EIA’s surveys indicated that an average of 219,000 barrels of oil per day were being pulled from the supplies of oil stored in the US. So, based on that reported & estimated data, the crude oil figures provided by the EIA for the week ending September 15th appears to indicate that our total working supply of oil from storage, from net imports and from oilfield production was 1,735,000 barrels per day less than what our oil refineries reported they used during the week. To account for that difference between the apparent supply of oil and the apparent disposition of it, the EIA just inserted a [ +1,735,000 ] barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet in order to make the reported data for the daily supply of oil and for the consumption of it balance out, a fudge factor that they label in their footnotes as “unaccounted for crude oil”, thus suggesting there was an error of that magnitude in the week’s oil supply & demand figures that we have just transcribed.... Moreover, since last week’s “unaccounted for crude oil” figure was only at [+15,000] barrels per day, that means there was a 1,720,000 barrel per day difference between this week's big oil balance sheet error and the EIA's modest crude oil balance sheet error from a week ago, and hence the changes to supply and demand from that week to this one that are indicated by this week's report are off by that much, and therefore useless...however, since most oil traders react to these weekly EIA reports as if they were accurate, and since these weekly figures therefore often drive oil pricing, and hence decisions to drill or complete oil wells, we’ll continue to report this data just as it's published, and just as it's watched & believed to be reasonably reliable by most everyone in the industry...(for more on how this weekly oil  data is gathered, and the possible reasons for that “unaccounted for” oil, see this EIA explainer)….(NB: there is also a more recent twitter thread from an EIA administrator addressing these errors, and what they had hoped to do about it)

This week's 219,000 barrel per day decrease in our overall crude oil inventories came as an average of 305,000 barrels per day were being ​p​ulled out of our commercially available stocks of crude oil, while an average of 96,000 barrels per day were being added to the oil in our Strategic Petroleum Reserve, the seventh consecutive weekly increase in the SPR after three years of withdrawals. Further details from the weekly Petroleum Status Report (pdf) indicate that the 4 week average of our oil imports fell to an average of 6,872,000 barrels per day last week, which was still 7.9% more than the 6,368,000 barrel per day average that we were importing over the same four-week period last year. This week’s crude oil production was reported to be unchanged at a forty-one month high of 12,900,000 barrels per day because the EIA's rounded estimate of the output from wells in the lower 48 states was unchanged at a forty-one month high of 12,500,000 barrels per day, while Alaska’s oil production was 5,000 barrels per day higher at 415,000 barrels per day but still added the same 400,000 barrels per day to the rounded national total as it did last week...US crude oil production had reached a pre-pandemic high of 13,100,000 barrels per day during the week ending March 13th 2020, so this week’s reported oil production figure was still 1.5% below that of our pre-pandemic production peak, but was 33.0% above the pandemic low of 9,700,000 barrels per day that US oil production had fallen to during the third week of February of 2021.

US oil refineries were operating at 91.7% of their capacity while processing those 16,800,000 barrels of crude per day during the week ending September 15th, down from their 93.7% utilization rate during the prior week, a decline in refinery utilization that is fairly normal during the weeks right after Labor Day.. The 16,304,000 barrels per day of oil that were refined this week were 0.3% less than the 16,355 ,000 barrels of crude that were being processed daily during week ending September 16th of 2022, and 2.4% less than the 16,707,000 barrels that were being refined during the prepandemic week ending September 13th, 2019, when our refinery utilization rate was at 91.2%, also down sharply from the prior week of that year...

Even with decrease in the amount of oil being refined this week, the gasoline output from our refineries was higher, increasing by 499,000 barrels per day to 9,711,000 barrels per day during the week ending September 15th, after our refineries' gasoline output had decreased by 576,000 barrels per day during the prior week. This week’s gasoline production was 2.7% more than the 9,459,000 barrels of gasoline that were being produced daily over the same week of last year, and 2.8% more than the gasoline production of 9,451,000 barrels per day during the prepandemic week ending September 13th, 2019.  On the other hand, our refineries’ production of distillate fuels (diesel fuel and heat oil) decreased by 229,000 barrels per day to 4,782,000 barrels per day, after our distillates output had decreased by 6,000 barrels per day during the prior week. With that decrease, our distillates output was 8.7% less than the 5,236,000 barrels of distillates that were being produced daily during the week ending September 16th of 2022, and 6.4% less than the 5,109,000 barrels of distillates that were being produced daily during the week ending September 13th, 2019...

Even with this week's increase in our gasoline production, our supplies of gasoline in storage at the end of the week fell for the 22nd time in thirty-one weeks, decreasing by 831,000 barrels to 219,476,000 barrels during the week ending September 15th, after our gasoline inventories had increased by 5,561,000 barrels during the prior week. Our gasoline supplies fell this week because the amount of gasoline supplied to US users rose by 103,000 barrels per day to 8,410,000 barrels per day, and because our exports of gasoline rose by 233,000 barrels per day to 1,144,000 barrels per day, and because our imports of gasoline fell by 388,000 barrels per day to 511,000 barrels per day ....Even after twenty-two gasoline inventory decreases over the past thirty-one  weeks, our gasoline supplies were 2.3% more than last September 16th's gasoline inventories of 214,610,000 barrels, while about 3% below the five year average of our gasoline supplies for this time of the year…

Meanwhile, with this week's decrease in our our distillates production, our supplies of distillate fuels decreased for the fifteenth time in twenty-eight weeks, falling by 2​,867,000 barrels to 119,666,000 barrels during the week ending September 15th, after our distillates supplies had increased by 3,931,000 barrels during the prior week. Our distillates supplies fell this week because the amount of distillates supplied to US markets, an indicator of our domestic demand, rose by 588,000 barrels per day to 4,166,000 barrels per day, and because our imports of distillates fell by 102,000 barrels per day to 83,000 barrels per day, ​w​hile our exports of distillates rose by 52,000 barrels per day to 1,108,000 barrels per day....With 39 inventory increases over the past seventy weeks, our distillates supplies at the end of the week were still 2.1% above the 117,250,000 barrels of distillates that we had in storage on September 16th of 2022, but were also about 14% below the five year average of our distillates inventories for this time of the year...

Finally, with our oil imports much lower and our oil exports much higher, our commercial supplies of crude oil in storage fell for 16th time in twenty-four weeks and for the 27th time in the past year, decreasing by 2,136,000 barrels over the week, from 420,592,000 barrels on September 8th to 418,456,000 barrels on September 15th, after our commercial crude supplies had increased by 3,955,000 barrels over the prior week. With this week's decrease, our commercial crude oil inventories ​w​ere about 3% below the most recent five-year average of commercial oil supplies for this time of year, ​b​ut were 26.8% above the average of our available crude oil stocks as of the third weekend of September over the 5 years at the beginning of the past decade, with the difference between those comparisons arising because it wasn’t until early 2015 that our oil inventories first topped 400 million barrels. After our commercial crude oil inventories had jumped to record highs during the Covid lockdowns of the Spring of 2020, then jumped again after February 2021's winter storm Uri froze off US Gulf Coast refining, but then fell in the wake of the Ukraine war, only to jump again following the Christmas 2022 refinery freeze offs, our commercial crude supplies as of this September 15th were 2.9% less than the 430,774,000 barrels of oil in commercial storage on September 16th of 2022, but were 1.1% more than the 413,964,000 barrels of oil that we still had in storage on September 17th of 2021, while 15.4% less than the 494,406,000 barrels of oil we had in commercial storage on September 18th of 2020, after early pandemic precautions had left a lot of oil unused…

This Week's Rig Count

in lieu of our usual rig count coverage, we are again just including below a screenshot of the rig count summary pdf from Baker Hughes...in the table below, the first column shows the active rig count as of September 22nd, the second column shows the change in the number of working rigs between last week’s count (September 15th) and this week’s (September 22nd) count, the third column shows last week’s September 15th active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running on the Friday before the same weekend of a year ago, and the 5th column shows the number of rigs that were drilling at the end of that reporting week a year ago, which in this week’s case was the 23rd of September, 2022...

DUC well report for August

The past week saw the release of the EIA's Drilling Productivity Report for September, which included the EIA's August data on drilled but uncompleted (DUC) oil and gas wells in the 7 most productive shale regions (click tab 3)....that data showed a decrease in uncompleted wells nationally for the 35th time out of the past 38 months, as both drilling of new wells and completions of drilled wells fell in August and remained well below the average pre-pandemic levels...for the 7 sedimentary regions covered by this report, the total count of DUC wells decreased by 39 wells, falling from a revised 4,788 DUC wells in July to 4,749 DUC wells in August, which was also 8.5% fewer DUCs than the 5,191 wells that had been drilled but remained uncompleted as of the end of August of a year ago...this month's DUC decrease occurred as 894 wells were drilled in the seven regions that this report covers (representing 87% of all U.S. onshore drilling operations) during August, down by 28 from the 922 wells that were drilled in July, while 933 wells were completed and brought into production by fracking them, down from the 949 well completions seen in July, and down by 113 from the 1046 completions seen in August of last year....at the August completion rate, the 4,749 drilled but uncompleted wells remaining at the end of the month represents a 5.1 month backlog of wells that have been drilled but are not yet fracked, unchanged from the DUC well backlog of a month ago, wh​ile up from the 7 1/2 year low of 4.6 months in January, on a completion rate that is now more than 20% below 2019's pre-pandemic average...

the drilled but uncompleted well count in the Appalachian region, which includes the Utica shale, decreased by 10 wells, from 724 DUCs at the end of July to 714 DUCs at the end of August, as 82 new wells were drilled into the Marcellus and Utica shales during the month, while 92 of the already drilled wells in the region were fracked...

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The state of fracking in Ohio - WOSU News (51 minute radio program) Hydraulic fracturing, better known as fracking, has proliferated over the last two decades as oil and gas companies drill all over the U.S. to find needed reserves.The Marcellus and Utica shale formations, which lie, in part, under the hills of eastern Ohio, are two of the most important sources of natural gas in the country.Oil and gas companies flocked to that area of the state, setting up extraction operations in some of the most impoverished areas of Appalachia, and promising profits and jobs.Has fracking delivered?Now there’s a fight over efforts to drill under Salt Fork State Park and other state-owned lands – a state commission on Monday voted for a reprieve – of sorts.We discuss the state of fracking in Ohio. Host: Mike Thompson, WOSU chief content director of radio. Guests:

• Jake Zuckerman, reporter, Cleveland.com
• Robert Wirkner, Carroll County commissioner
• Rob Brundrett, president of the Ohio Oil and Gas Association
• Randi Pokladnik, retired scientist, Save Ohio Parks

Falsified public comments loom over Ohio state parks drilling - An Ohio commission is poised to rule on proposals to drill under state parks and wildlife areas before the conclusion of an investigation into fabricated public comments submitted in favor of the proposals.The Ohio Oil and Gas Land Management Commission deferred a decision Monday in order to allow more time to consider the lease conditions proposed by the Ohio Department of Natural Resources. Chair Ryan Richardson said the commission still plans to make final decisions before the end of the year.The process is playing out despite claims by more than 150 Ohio residents that their names and addresses were used without their knowledge or consent on pro-fracking public comments submitted to the commission. Critics say that alleged fraud, along with proposed below-market royalties, raise questions about whether the commission can fairly comply with statutory criteria for approving parcels for fossil fuel development.“The falsified comments raise a lot of concerns about the already questionable efforts to drill in Ohio state parks,” said Ericka Copeland, state director for the Sierra Club of Ohio. “It’s reprehensible and it’s undemocratic.”House Bill 507 jumpstarted the leasing process after lawmakers passed it last winter without any hearings on the law’s oil and gas provisions. A constitutional challengeremains pending in state court, but roughly a dozen leasing proposals have already been under review by the state land management commission. The commission approved four proposals for Department of Transportation properties on Monday. The rest under review are Department of Natural Resources properties.A Cleveland.com and Plain Dealer investigation this month showed dozens of pro-fracking comments on the proposals were submitted without their purported authors’ knowledge or consent. By Sept. 15, approximately 150 comments of roughly 1,000 form-letter emails had been contested, an update shows.In response, a Sept. 15 letter from 19 environmental and consumer groups urged the leasing commission and the Ohio Department of Natural Resources to delay decisions or deny any proposals for drilling under Ohio public lands until after a thorough investigation to verify and correct the public record.“That’s the concern — the timetable here,” Copeland said.The advocacy groups’ Sept. 15 letter also asked the Ohio attorney general’s office for a full investigation and any necessary action to protect against deceptive use of Ohioans’ information to influence public processes.“The attorney general takes these allegations seriously and has assigned investigative staff to look into the matter,” said deputy press secretary Dominic Binkley at Ohio Attorney General David Yost’s office. He declined to disclose information about the investigation’s expected timeline or whether the attorney general would support the denial or delay of approvals before it concludes.“The commission is determined to follow the statute as it carries out the land leasing process as required by Ohio Revised Code. That includes administering an open public comments period that does not infringe on Ohio law or First Amendment rights,” said ODNR spokesperson Andy Chow. “Meanwhile, the commission is currently working on creating a public comments portal where people can directly submit their comments to the website with additional authentication tools.”

Fracking under Ohio state parks on agenda for the first time at Monday meeting - -- On Monday, as directed by state legislators, the Ohio Oil & Gas Land Management Commission will consider nominations of fracking sites, from which drilling under the entire park and adjoining wildlife areas would be conducted."That final decision to approve or disapprove a nomination must happen within 180 days (two calendar quarters) of receipt," said Andy Chow, Ohio Department of Natural Resources spokesman."Should a nomination be approved by the commission, the nomination would then be put out to bid the following calendar quarter (as required in statute). This gives any party the opportunity to place a bid for the mineral leasing rights for the parcel that was nominated and approved."Numerous environmental groups asked the commission Friday to postpone the meeting in light of dozens of allegedly faked letters of support that Ohio Attorney General Dave Yost is probing.The Ohio Department of Natural Resources doesn’t oppose the proposals but wants additional restrictions to protect the 20,000-acre park. Some of the wellpads would be as close as 400 feet from the park boundary. Rob Brundret, president of the Ohio Oil and Gas Association, said the rigs that will drill down, then horizontally deep under the park, will be present for a few weeks. Afterward, the drilling site should be almost unnoticeable. "All you might see is a pickup truck once a day or a couple times a week going out and checking on the well, making sure everything is operating as efficiently as possible, and really all you have there are some tanks in the wellhead," he told ABC 6. He said that most of the public doesn’t know that wellpads already exist close to state parks -- the drilling now just goes the other way."We think Ohioans will still be able to enjoy all of the benefits that the state parks offer," Brundret said. "I think the industry knows and will continue to work with the (Gov. Mike) DeWine administration to ensure that there's no on-the-ground disruptions in any of the parks."The lands controlled by the Muskingum Watershed Conservancy District have been fracked for years, and the public still uses those areas for outdoor recreation without any problems.But with hundreds of square miles already available for fracking, why the need to drill under state parks and other public lands?"For a global macro perspective, it's incredibly important to make sure that the United States and Ohio has the energy, the affordable and abundant energy, to continue to operate as a country, whether that's through our electricity creation, for other power needs, for the products we use every day. And so it's important that we make sure that we have these abilities to do that, not just in Ohio, but in the other states where we have these resources," he said."A lot of people want to talk about climate change and emissions and carbon reductions. You know, one of the things that we've done as an industry is look, you know, we think that one of the greenest things you can absolutely do is reduce the world on foreign coal and produce more natural gas." About 30 miles northeast of Salt Fork, chemist and environmental scientist Randi Pokladnik offers what she calls “toxic tours” of the heart of Ohio fracking country. While fracking proponents brag about its safety, Pokladnik cites blown-out wellheads and a 2014 fire in Monroe County for which the company was fined $223,000. "I mean, it looked like they dropped an atomic bomb on this well pad. Everything that was on it was burned and just ... got obliterated. It was such a hot fire. I think that they didn't even send firefighters in because they said it's too dangerous. Just let it burn." And while some individual landowners have gotten rich, she told us the fracking boom hasn’t been the economic boon some claim. "I mean, if you're a truck driver with a CDL, and you can weld -- well, they're two (jobs) that local people can do. But that's a young person. That's not somebody in their 50s and 60s. They're not going to make a living in that. They can't physically do it," she said. Since fracking came on the scene, she said, several eastern counties are among those losing the most population in Ohio. "All the big fracking counties are in the top 10 for losing population. So you know that just shows you how this false claims of jobs is just what it is, false."

Panel allows drilling on some Ohio-owned lands but delays vote on leases in state parks | The Statehouse News Bureau - As dozens of anti-fracking activists watched, an Ohio Department of Natural Resources panel voted to let companies bid on rights to drill in four parcels of state-owned land. But the Oil and Gas Land Management Commission postponed voting on drilling in state parks to its next meeting. As activists shouted "shame" and "yes men," votes on nominations for leases to drill on land owned by the Ohio Department of Transportation went forward. The four parcels of land are public rights-of-way near state routes in eastern Ohio. The vote from the commission means drilling companies have the next three months to bid on the leases. When the open-bid period closes, the commission must then select the highest and best bid. But votes on leases in Salt Fork State Park, north of Cambridge, Wolf Run State Park, south of Cambridge and Zepernick Wildlife Area, east of Canton, were tabled until the commission's next session to allow time for some legal questions to be answered. A spokesman with the Ohio Oil and Gas Association said that’s fine. “There's no rush here. We've been at this since 2011. And so it's important to get it right and get it right the first time," said Michael Chadsey, who was in the packed room for the meeting. "That will give them time to do their research and have their conversations and talk with the DNR and talk with the industry about how's the best, what's the best plan to move forward." While the decision to put off votes on leases for drilling in state parks may have seemed to be a relief to the activists, they aren't pleased. “I'm not happy because our campaign was to get denials on all the nominations - ODOT [land], the parks, the wildlife areas. So I'm not satisfied with that," said Roxanne Groff with Save Ohio Parks. "To me, it just looks like a pathway to go ahead and do approvals on all the nominations." But commission chair Ryan Richardson said she doesn’t think state law allows the panel to block opening up state lands for oil and gas exploration. "There is authority to disapprove, as I said during the meeting," Richardson said. "But I feel like that the statute is pretty clear that it is only for the considerations that are in the statute that we have the authority to deny." Some of the nine things that are in that state law, Richardson said, are "open to additional debate and consideration," which is why the votes were tabled. Those considerations include economic benefits, environmental or geological impact, impact to visitors or users of land or public comments. Certain information about companies that hope to win the leases to drill on state land is confidential and can't be disclosed at this point. Some in the room called for the commission to allow public input. The public comment period on these nominations closed several weeks ago, and Richardson said this meeting was not the forum for comments. “Certainly public comments are very important and something that we can and do consider," Richardson said. "But our criteria is set out in the statute of what we're supposed to consider with respect to individual nominated land.” Richardson also briefly commented on the letters that came in supporting drilling with the names of people who didn’t authorize them or support it. "As soon as those concerns were brought to our attention, we did share those with the attorney general's office, which we think is the appropriate body to investigate those," Richardson said. "There will be an investigation and so we will certainly cooperate with that and continue as we have to share any information that we have that might be relevant to their investigation."

Pro-fracking public comments in Ohio stem from 'misleading' ads - In July, Ohio regulators received nearly 2,000 public comments that implored them to allow fracking in state parks, saying it would address soaring energy prices. “Ohioans, like me, have been burdened by rising energy costs,” wrote a commenter identified as Nancy Shankin. “It is critical that we utilize the abundant natural resources available to us right here in Ohio, not only to bring costs down, but to support our local economy.”Yet Shankin lives in Michigan, not Ohio, public records show. And environmentalists say her comment — and nearly 2,000 others like it — can be traced back to misleading Facebook ads from an organization with alleged ties to the natural gas industry.The organization, Ohio’s Energy Future Coalition, paid forFacebook ads that asked people to sign a petition to “support affordable domestic energy.”The Facebook ads took viewers to the coalition’s website, where they could sign a petition to “support permits to access Ohio’s abundant and affordable homegrown energy.”

• The petition did not mention that the Ohio Oil and Gas Land Management Commission was weighing whether to open state parks and wildlife areas to fracking, the controversial and lucrative process of extracting natural gas from deep rock formations.
• Yet once someone signed the petition, the coalition submitted a public comment in their name asking the commission to allow fracking in Salt Fork State Park, the largest state park in Ohio, according to environmentalists who signed the petition to confirm this chain of events.

Cathy Cowan Becker, a co-founder of the environmental group Save Ohio Parks, said the Facebook ads were “misleading” and may have tricked people into submitting a pro-fracking comment to state regulators.“Those people filled out a form thinking they were signing a petition for lower gas prices, but not understanding that they were filing a public comment in support of fracking at Ohio state parks,” Becker said.

Fraud Allegations in Ohio Public Lands Fracking Controversy > As Ohio moves forward with leasing public lands for oil and gas fracking, allegations that supporters filed fraudulent letters in favor of these leases — using real Ohioans’ identities without their consent — have prompted the state attorney general to investigate.Ohio Gov. Mike DeWine signed legislation in January mandating mineral rights leases to oil and gas drilling companies for fracking operations beneath Ohio State Parks and other public lands. Oil and gas companies have nominated dozens of tracts of land for leasing since the law took effect May 30.A public comment period for a nomination to lease mineral rights for fracking beneath Salt Fork State Park – the state’s largest at approximately 7,000 acres – closes September 25.Environmental groups and concerned citizens continue to protest the use of public lands for fracking.Now, some Ohio residents say their names appear on emailed letters they didn’t write, that urge Ohio’s Oil and Gas Land Management Commission to support state land mineral leases and develop oil and gas resources. According to a report by Jake Zuckerman on the cleveland.com website, one bore the signature of a 9-year-old child.“In one set of comments, 1,100 letters were submitted in five batches, with hundreds of letters in each batch showing a timestamp of a single minute,” said Save Ohio Parks steering committee member Cathy Cowan Becker in a September 15 press release.“The information for Ohioans whose names were on those letters included phone numbers, so a dozen Save Ohio Parks volunteers called 735 of those numbers. We reached 115 people and of those, 98 told our volunteers they did not submit the letter.”Some Ohio residents say their names appear on emails submitted to Ohio’s Oil and Gas Land Management Commission – like the one above – that they didn’t write. The letters urge the commission to support state land mineral leases and develop oil and gas resources. Screenshot of email posted to Ohio Attorney General’s Office website[/caption]Molly Jo Stanley, Southeast Ohio regional director for the Ohio Environmental Council, points out that while the fossil fuel companies submitting nominations remain anonymous, Ohio residents’ names and addresses become public record when they submit comments.“Fossil fuel interests exploited Ohioans by preying upon their identities for their own financial gain, resulting in numerous residents’ personal information — including a minor — being exposed online without their consent,” Stanley says in the release.Roxanne Groff, an environmental activist with Save Ohio Parks, noticed the suspicious nature of the letters after obtaining them from the Oil and Gas Land Management Commission through a public records request. The group then sent a letter to the commission alerting them to the possibly fraudulent emails on July 16.Groff says the Ohio Environmental Council then traced the emails to Consumer Energy Alliance, a Texas-based nonprofit funded in part by the oil and gas industry that lobbies for fossil fuel interests, through a link to a CEA webpage that contained the same wording as the suspicious emails. The webpage is no longer accessible on the CEA website.“We could not verify the other 1,600 emails sent from [Ohio’s Energy Future Coalition],” Groff says, explaining that an Ohio Environmental Council member found that Ohio’s Energy Future Coalition shared an address with the Affordable Energy Fund PAC, which has oil and gas industry connections.

Utica Shale Academy opens outdoor welding lab for students - Dozens of officials representing education, business and the community gathered for the unveiling of the Ascent Resources Welding Lab located adjacent to the Hutson Building on East Main Street in Salineville Sept. 12. This new offering at the Utica Shale Academy will help expose students to real-world working conditions.The facility features 20 exterior welding bays and room for storage and would serve upwards of 100 students. USA Superintendent Bill Watson said the purpose of the facility is to introduce pupils to welding in the elements so they know what is expected on the job.“It’s one thing to weld when it’s 70 degrees outside, but it’s another when it is cold. That’s the nature of the welding lab: They will be in the elements and we wanted them to really train and be prepared for these jobs,” Watson said.The site has been nearly two years in the making and was finally completed last week. He said the concept was based on an idea by instructor Matt Gates and may be among the first of its kind in the state.A funding shortfall nearly shelved the project, however, until Ascent stepped up to help, contributing $75,000. Additional funds came from Elementary and Secondary School Emergency Relief. SkyOxygen of Pittsburgh constructed the one-story building and Watson said five cohorts of 20 students can utilize the lab.USA has been expanding its campus and currently includes the Hutson Building, which houses general classrooms and Virtual Learning Academy programming through the JCESC; the Utica Energy Center at the former Huntington Bank, which is in partnership with Youngstown State University and offers megatronics, hydraulics, pneumatics, AC/DC electric, Programmable Logic Controllers, diesel mechanics and horticulture for students and adults, and the newly opened Utica Shale Academy Community Center on Church Street, which includes a fitness center and certified health workers for further support.

EPA Approves Permit for Controversial Fracking Disposal Well in Pennsylvania - The Environmental Protection Agency (EPA) this week approved a permit for a toxic fracking wastewater disposal well named Sedat 4A, a highly controversial project in Plum Borough, Pennsylvania, rejecting residents’ concerns that leaks from the well could migrate and pollute other wells and groundwater.The decision comes as Pennsylvania faces a fracking disposal reckoning. Historically, the state has trucked much of its fracking waste to Ohio, which has a more robust infrastructure of injection wells. But now, as scrutiny over the safety of storing toxic wastewater underground mounts in Ohio, oil and gas companies operating in Pennsylvania find themselves in need of other reliable options for disposing of their wastewater.In the fracking process, drillers pump 15 to 20 million gallons of water and fracking chemicals into a well at high pressure to extract gas from small seams in the Marcellus Shale. Once the well starts producing gas, about 5 to 10 percent of the water used to frack the well resurfaces.Because this produced water has dissolved elements in the shale, it contains hydrocarbons, heavy metals and salt concentrations up to seven times higher than sea water, and can sometimes contain radium 226 or 228, radioactive isotopes, in addition to the chemicals added for fracking. While almost half of Pennsylvania’s produced water is then recycled to frack additional wells, it reaches a point when it can no longer be reused and must be disposed of. Treating the water to remove the chemicals and natural contaminants is prohibitively expensive. One solution has been to convert some of the state’s hundreds of thousands of conventional gas wells into disposal, or injection, wells. These conventional wells—which bore into porous rock formations and run only vertically a few thousand feet into the earth—were drilled decades ago, and many have been sitting abandoned for years. In a day’s work, a typical injection well pumps millions of gallons of toxic wastewater from fracking thousands of feet below ground at high pressure into the old, abandoned well. Currently, there are 14 such injection wells operating in the state. “We’re seeing a trend of these conventional well operators repurposing non-producing conventional wells into injection wells.” said Gillian Graber, executive director and founder of Protect PT, an organization focused on educating Pennsylvanians living in the state’s southwestern counties on the impacts of fossil fuel drilling on their communities. “These conventional wells are just simply not engineered for this purpose,” she said.

EIA Sep DPR: Shale Gas Production Drops Like a Rock, M-U Leads Drop Marcellus Drilling News - The latest monthly U.S. Energy Information Administration (EIA) Drilling Productivity Report (DPR) for September, issued yesterday (below), shows EIA believes shale gas production across the seven major plays tracked in the monthly DPR for October will *decrease* production from the prior month of September–by a large quantity. This is the third month in a row EIA predicts shale gas production will decrease for the combined seven plays. EIA says combined natgas production will slide by 339 MMcf/d (million cubic feet per day)–roughly one-third of a billion cubic feet per day (Bcf/d). The Marcellus/Utica, called “Appalachia” in the report, is predicted to slump by 137 MMcf/d in October compared with September–the biggest slump of any of the seven plays.

22 New Shale Well Permits Issued for PA-OH-WV Sep 11 – 17 | Marcellus Drilling News - New shale permits issued for Sep 11 – 17 in the Marcellus/Utica rebounded. There were 22 new permits issued last week, up from 14 issued two weeks ago. But the increase came from an unlikely source. Last week’s permit tally included 9 new permits in Pennsylvania, 1 new permit in Ohio, and 12 new permits in West Virginia. WV is typically on the low end of permits, not the high end. The top permittee for the week was Antero Resources, which received 6 permits in WV. EQT was a close second with 5 permits in WV. ANTERO RESOURCES | ASCENT RESOURCES | BEAVER COUNTY | BRADFORD COUNTY | CHESAPEAKE ENERGY | DODDRIDGE COUNTY | ELK COUNTY | EQT CORP | JEFFERSON COUNTY (OH) | MARION COUNTY | MARSHALL COUNTY | RANGE RESOURCES CORP | SENECA RESOURCES | SOUTHWESTERN ENERGY WETZEL COUNTY

SRBC Approves 8 New Water Withdrawal Requests for Shale Drilling - Marcellus Drilling News --The highly functional and responsible Susquehanna River Basin Commission (SRBC), unlike its completely dysfunctional and irresponsible cousin, the Delaware River Basin Commission (DRBC), continues to support the shale energy industry by approving water withdrawals for responsible and safe shale drilling. Last week, the SRBC approved 22 new water withdrawal requests within the basin, eight of which are for water used in drilling and fracking shale wells in Pennsylvania. The Marcellus/Utica shale drillers receiving a green light from SRBC included BKV (Banpu), Coterra Energy, EQT, Inflection Energy, Repsol (2 requests), Seneca Resources, and S.T.L. Resources.

Pipeline Problems Could Cut Off Nation's 100-Year Gas Supply - TheOhio Star - A recent analysis determined the United States sits on a century’s worth of gas supply, but industry experts warn there aren’t enough pipelines to access it.The report from the Potential Gas Committee, part of the Colorado School of Mines, found that the country had technically recoverable gas resources of 3,353 trillion cubic feet, a 0.5% decrease from its 2020 estimate.Despite this, however, total future supply has hit the highest level recorded by the committee in 60 years.Steven Sonnenberg of the Colorado School of Mines noted they have seen a “bit of a plateau in recent years,” but “proved reserves are also increasing,” which represents more drilling activity from companies. It also shows more natural gas is moving from potential underground fields to actual reserves.The Energy Information Administration tracks proved reserves, which are confirmed gas supplies, while the committee tracks unconfirmed probable resources (like field extensions or new pools in discovered natural gas areas), possible resources (like new natural gas fields), and speculative resources (where new basins might be).“We’re essentially at all-time highs with both cumulative production, crude production, and these gas resource numbers,” Sonnenberg said.The U.S. consumes about 30 trillion cubic feet of natural gas annually, Sonnenberg noted, which would mean the country has a “100-year resource of natural gas” with its proven and estimated supply.Natural gas supplies in the Atlantic area, in which Pennsylvania resides, declined by 2.5% to 1,259 Tcf, but remain the most significant part of the country, with 40% of the country’s natural gas supply.“All of the increases in the Atlantic Area’s assessment since 2016 arose from ongoing evaluation of Appalachian basin shales, predominantly the prolific Marcellus in Pennsylvania and West Virginia,” the committee’s report noted.Pennsylvania in recent years has seen record revenues from its impact fee, which distributes money to local governments where natural gas production occurs. The Independent Fiscal Office, however, expects those payouts to decline.Production growth has also stalled, which industry advocates argue is a result of pipeline capacity limits and permitting delays, while environmental groups charge that natural gas production has permanently plateaued.The committee acknowledges that without more pipelines, the gas supply will sit unused.“The availability of pipelines to get the product out of the shale gas fields in particular — there’s only so much they can get to market without more of that infrastructure,” Committee President Kristin Carter said. “For that reason, you might have inactive wells … those things will put a hold on the resource assessments.”

US Gas Supply Higher Than Thought: Can Pipelines Keep Pace? | Energy Intelligence - The US, already a top producer of natural gas, could see even more future supply than previously thought as demand for the cleaner-burning fossil fuel continues to rise. But whether infrastructure to move that gas to market can keep pace is an open question.In a biennial assessment delivered this week, the Potential Gas Committee (PGC) reported an updated future US gas supply estimate of a record 3,978 trillion cubic feet as of 2022 — enough to satisfy current domestic demand for more than 100 years.The committee’s assessment of future gas supply, which combines estimates for technically recoverable resources and proven reserve volumes, represents a 3.6% increase from the 2020 estimate. The biggest share of supply is expected to come from the Atlantic region, home to the powerhouse Marcellus and Utica shale plays. The area accounts for 40% of estimated gas resource, according to the report. Overall, shale accounts for 61% of the estimated gas resource.With domestic gas consumption hovering near record highs, and global demand for US LNG expected to grow dramatically this decade, access to additional supply will be key, industry officials say. But it also poses challenges."Future gas supplies continue to increase as the energy industry innovates, improves processes, optimizes resources, invests in efficiency and reduces emissions,” said Richard Meyer, the American Gas Association's vice president of energy markets, analysis and standards. “However, to fully realize the potential of this natural gas supply, new infrastructure will be required to connect production zones to demand centers.”“The availability of pipelines to get the product out of the shale gas fields in particular — there's only so much they can get to market without more of that infrastructure, “So for that reason, you might have inactive wells," PGC President Kristin Carter agreed. She also cited other potential challenges to producing the additional resource quickly, including drilling permit wait times and crew shortages. "So you can have your well be kind of just in standby mode for a year or two because you're waiting on a pipeline, you're waiting on maybe some technology, or the the frack trucks, [if] the support companies are too busy and can't get to your well."The biggest share of supply is expected to come from the Atlantic region, home to the powerhouse Marcellus and Utica shale plays.

Groups say ‘clean’ hydrogen projects lack transparency and fear climate, safety impacts -- Hydrogen is considered a potential source of clean energy as the world steers away from burning fossil fuels, the main cause of global warming. But a growing number of organizations in Western Pennsylvania say they’re worried about proposals for a so-called ‘hydrogen hub’ in the region – where a network of companies would produce, process and use hydrogen. They say the public has been kept in the dark about the projects, and are worried about what impacts they’ll have on local communities. Two proposed hubs based in Western Pennsylvania – the Appalachian Regional Clean Hydrogen Hub, or ARCH2, and the Decarbonization Network of Appalachia, or DNA – are among over 20 vying for federal hydrogen funding. The Appalachian hubs would produce “blue” hydrogen – where the element is stripped out of natural gas, and carbon dioxide produced in the process gets injected underground, instead of being released into the atmosphere. Others have proposed using renewables to create hydrogen out of water, known as “green” hydrogen, or the same process using nuclear energy, known as “pink” hydrogen. President Biden’s Bipartisan Infrastructure Law included $7 billion to fund six to 10 hydrogen hubs around the country. The law mandated that two of the hubs be located in a region with large natural gas resources.But what is involved in building the projects, where will they be sited, how many jobs will go to local populations, what will be the environmental impacts – all of that is being kept secret by the Department of Energy, which is reviewing the applications.“The applicants have completely cut out the public and impacted community members…from any decisions regarding their operations and plans and infrastructure footprints, and policymakers have done little to hold them accountable for that,” said Tom Torres, hydrogen campaign coordinator for the Ohio River Valley Institute. “Unfortunately, even at this point, there’s very little information about either of the specific hubs and, you know, what their impacts could be.”The ARCH2 consortium required community groups to sign a non-disclosure agreement to see details of the proposal, according to a report in Inside Climate News.In a statement, the Department of Energy said clean hydrogen would play a critical role in President Biden’s “vision of a clean energy future.” The agency said it has put in place mandates that the hubs applying for federal funds include a community benefits plan describing how the groups will interact with community and labor groups, and meet the administration’s workforce, diversity and environmental justice goals. While few details are known about the proposals, they’ve attracted big oil and gas companies like Shell and EQT. Torres worries about what continued extraction could mean for the region. “The method of hydrogen production involves a significant amount of fossil fuels and so they’ll be using hydrogen from fracking, which comes with a lot of associated risks to public health and to the environment,” Torres said. A recent state-funded study found links between fracking and asthma and childhood lymphoma in Western Pennsylvania. Other studies have shown links to childhood leukemia, low birth weight and premature death in the elderly, among other health effects.Environmentalists are also skeptical about blue hydrogen’s climate benefits because they say companies haven’t yet shown they can capture CO2 from hydrogen production at sufficient rates.“We don’t think that these claims by industry that they’ll be able to capture 95% or more of the carbon dioxide from a hydrogen production facility are realistic,” said David Schlissel, director of Resource Planning Analysis at the Institute for Energy Economics and Financial Analysis.“Studying the technology is a good idea, and doing some larger-size tests where they capture more of the CO2 over time is a good idea,” he said. “But running off and implementing it and giving tens of billions of dollars to project developers is asking for trouble.”

In West Virginia, Plan to Clean up Radioactive Fracking Waste Ends in Monster Lawsuit – DeSmog - In rural West Virginia, largely hidden among steep hills, stands a $255 million facility designed to transform fracking waste into freshwater and food grade quality salts. Proponents hailed it as one of the most important environmental projects undertaken by the oil and gas industry in recent U.S. history. But local conservation groups and residents remained skeptical from the start, warning that the plant could leak toxic waste into water and air, harming human health and ecosystems in a largely forested region where tight-knit communities live close to the land. The facility, called Clearwater, was built by the Denver, Colorado-based oil and gas extraction company, Antero Resources, and an affiliate of Veolia, the multinational French waste, water and energy management company. It lies in the heart of north central Appalachia’s booming Marcellus and Utica gas fields — America’s top natural gas-producing region — and was built to process 600 truckloads per day of fracking wastewater. Laden with heavy metals, chemicals and other contaminants, this waste frequently exhibits levels of radioactivity hundreds of times the safe limits set by regulators. The developers’ hopes were initially high. At a meeting in September 2015 at the courthouse in Doddridge County, West Virginia, Conrad Baston, the general manager of civil engineering with Antero, suggested salt produced during the waste treatment process could be called, “Taste of the Marcellus,” after the gas-rich geologic formation from which it came. “It’s the best project like this in the world,” Kevin Ellis, Antero’s vice president of government relations, told a West Virginia newspaper in 2019. “Bar none. Period.” Ellis is currently Antero’s regional vice president in Appalachia, and Baston is still stationed with Antero in West Virginia. Antero was to own the treatment plant and supply it with fracking waste from its nearby oil and gas extraction operations. Veolia would design, build, operate and maintain the facility under a 10-year agreement in return for more than $255 million, Antero said in 2015. Clearwater began operating in November 2017, according to one drilling industry news site. But a mere 22 months later, the facility was idled, and Antero and Veolia are now locked in a half billion-dollar legal battle over the plant. On March 13, 2020, Antero filed a lawsuit against Veolia in the District Court of Denver County, Colorado. The complaint, obtained by DeSmog via a public records request, accused the company of fraud, breach of contract, gross negligence, and willful misconduct, and demanded at least $457 million in damages.“Clearwater was a failure,” reads the complaint. “Veolia promised[] a ‘turnkey’ facility” where Antero would “simply ‘turn the key’ and have everything function as intended” but “Veolia failed at every turn,” the complaint alleges.The filing further alleges that Veolia “started cutting corners even before the project started,” “hid” vital design flaws, and made modifications that were “ill-conceived, untested, and poorly implemented” and ultimately “doomed the commercial viability of the facility.” According to the complaint, the idling of the plant in September 2019 had nothing to do with a drop in natural gas prices, the reason Antero officials stated to a Pittsburgh newspaper at the time. The real explanation, the complaint alleges: “The facility simply did not work.”

Commonwealth LNG pens preliminary deal with EQT - US natural gas producer EQT Corporation has entered into a heads of agreement for liquefaction services from Commonwealth LNG’s proposed facility in Cameron, Louisiana. EQT plans to liquefy 1 million tons per annum of LNG under a 15-year tolling agreement, it said in a statement. However, final terms remain subject to negotiation of a definitive agreement between the two firms. EQT’s president and CEO Toby Rice said this deal represents “another step forward in EQT’s risk-adjusted LNG strategy, which seeks to diversify a portion of our production to international markets via arrangements that offer the best combination of upside exposure and downside risk mitigation.” “Our tolling capacity gives us the flexibility to sell our gas directly to end users globally and we are currently pursuing long-term purchase agreements with prospective international buyers,” Rice said. Houston-based Commonwealth LNG said in a separate statement it still anticipates a final investment decision on the project in the first quarter of 2024, with first cargo deliveries expected in 2027. It said that the terms anticipated under the HOA would commence at the start of commercial operation of the facility. The company’s 9.3 mtpa plant in Cameron will use gas turbines and other equipment from energy services firm Baker Hughes as part of a deal announced last month. Commonwealth LNG recently entered into a non-binding 20-year supply deal with Switzerland-based energy trader MET Group for 1 mtpa of LNG and it also closed an investment of development capital from private funds managed by Kimmeridge Energy Management. This investment completes the development funding required for the firm to reach FID.

Louisiana’s Cameron Parish Advancing CCS Hub to Store Emissions from LNG, Petchem Facilities -- Houston-based Carbonvert, a carbon capture and storage (CCS) expert, is teaming with Castex subsidiary Castex Carbon Solutions LLC to capture carbon dioxide (CO2) emissions at the Cameron Parish CO2 Hub. The hub would service existing industrial emitters and anticipated greenfield projects. “We firmly believe our Cameron Parish offshore project will help shape Louisiana’s low carbon future,” Carbonvert CEO Alex Tiller said. “Our CCS project will strengthen the local economy,” enabled through state and federal funds.

Improving Natural Gas Infrastructure Paramount for Cold Weather Reliability, Says FERC Chair - Winter Storm Elliott, which slammed the East Coast in late 2022, made it “abundantly clear” that major improvements have to be made to the natural gas and electric grid systems, FERC Chair Willie Phillips said Thursday. Speaking during a regular Federal Energy Regulatory Commission meeting, Phillips said improvements must be made to the grid to ensure cold weather reliability. He was referring to the joint inquiry completed earlier this year with the North American Electric Reliability Corporation (NERC) (No. R23-29). “I have said repeatedly,” Phillips said. “Someone – it doesn’t have to be FERC – must have authority to establish and enforce natural gas reliability standards,” the chairman said. Some recommendations from the 2021 Winter Storm Uri report “are...

FERC cautions need to winterize power and gas systems in wake of Elliott - — A report by the Federal Energy Regulatory Commission has warned Congress and state legislatures they needed to require natural gas pipelines and power plants to better protect themselves against cold weather after a series of power outages in recent yearsIn a preliminary examination of the causes of last December's Winter Storm Elliott, which caused power outages along the East Coast and brought record cold to Texas, staff at the energy regulatory agency detailed how more than 1,700 power generation units shut down or reduced power due to cold weather. More than 800 of the generators were natural gas plants."Anyone would be forgiven if they looked at this report and said it's deja vu. This is the fifth time in 11 years where we had significant generator losses due to cold weather," said FERC Chairman Willie Phillips. "We need someone who is directly responsible for the reliability of our natural gas system."A major factor in the loss of generation, Thursday's report said, was a 16 percent decline in natural gas production due to frozen equipment, primarily in gas fields in Ohio, Pennsylvania and West Virginia, which resulted in pipelines losing pressure and cutting supply to power plants.In New York City, pressure on distribution lines dropped so low that the gas system was on the verge of a complete shutdown that could have taken months to restore.The report followed similar recommendations by FERC in the aftermath of Winter Storm Uri, which caused millions of Texans to lose power for days in 2021 and that led to the deaths of hundreds in the state.But so far Congress has been slow to expand regulation over the natural gas sector, Earlier this year the North American Energy Standards Board, which had been charged by FERC to better coordinate the gas and power sectors, reported it had seen pushback from gas companies over efforts to ensure the flow of natural gas to power plants at times of high demand"This is illustrative of the difficulty of relying on a voluntary, consensual process to find solutions for the issues we endeavored to address," the report read.After the report's release, Dena Wiggins, president of the Natural Gas Supply Association, disputed that claim, stating, "both the gas and power sectors agree on the need to find solutions mitigating reliability risks."

FERC Approves Next Phase of Port Arthur LNG, Other Export Projects After Impasse - FERC has approved a suite of natural gas projects, including the second phase of the Port Arthur LNG project, following a key meeting on Thursday when it addressed the items that were struck from its agenda in July following an impasse among commissioners. Sempra Infrastructure called the order authorizing Port Arthur’s second phase “a major regulatory milestone” for the project. The first 1.8 Bcf/d phase is under construction in Texas and was sanctioned earlier this year. The second phase would double capacity. The Federal Energy Regulatory Commission also approved plans to increase capacity at the Calcasieu Pass liquefied natural gas terminal in Louisiana by 50 MMcf/d. The Commission cleared Enbridge Inc.’s Venice Extension project for delivering 1.3 Bcf/d to the

Analysts Examine USA Gas Inventory Prospects for a 4+ trillion cubic foot end of October U.S. gas inventory level have faded, according to a new BofA Global Research report, which was sent to Rigzone this week. Storage is still likely to end the season at elevated levels, however, the report outlined, adding that this “has kept prices in check”. According to the report, weather, not prices, has played the “main role in absorbing excess inventories”. “During 2Q-3Q23, as wind underperformed, gas power burns averaged 39 billion cubic feet per day, up from 36.7 billion cubic feet per day over the same period in 2022 and 33.7 billion cubic feet per day in 2021,” the report noted. “High power burns lifted gas demand despite soft industrial and res/com use. Meanwhile, supply rose in the face of low prices, topping 102 billion cubic feet per day this summer. The net of these dynamics was a tighter balance, with storage falling to +200 billion cubic feet vs the five-year average recently from +370 billion cubic feet in June,” it added. U.S. gas inventories are likely to reach 3.81 trillion cubic deet at the end of October, the report outlined, highlighting that this would be “the highest level since 2020 (3.96 trillion cubic feet) and before that, 2016 (3.91 trillion cubic feet)”. This winter, U.S. production should average 101.9 billion cubic feet per day, or +1.5 billion cubic feet per day year on year, due to Permian and Northeast growth, the report noted. “Meanwhile, demand should rise three billion cubic feet per day year on year to 121.1 billion cubic feet per day due to higher LNG exports, which are set to average 1.8 billion cubic feet per day above 2022 levels thanks to Freeport’s return,” it added. “Res/Com and industrial demand should rise one billion cubic feet per day, while power demand comes in 500 million cubic feet per day lower year on year on higher renewables generation. Exports to Mexico averaged +300 million cubic feet per day year on year year to date, and we see winter 2023/24 volumes up 400 million cubic feet per day year on year too,” it continued. “Imports from Canada averaged nearly 300 million cubic feet per day lower year on year year to date, but we see this rebounding to +300 million cubic feet per day year on year this winter,” it went on to state. In the report, BofA Global Research revealed that it expects inventories to exit winter 2023/24 at 1.77 trillion cubic feet per day, “near five-year highs”. “If realized, this inventory path may cause Henry Hub gas to trade below our forecast of $3.50 million British thermal units (4Q23/1Q24) and below the current forward curve,” BofA Global Research warned in the report. A mild winter would put inventories on a path to hit new seasonal record highs by March and could lead to a repeat of sub $2 per million British thermal unit prices at times early next year as high-end of winter inventories reignite the possibility of hitting storage constraints next summer,” the report added. “True, supply growth is likely to slow next year year on year, but power burns, a big source of demand growth this year, should fall year on year next summer,” it continued.

All Eyes on LNG as Natural Gas Market Seen Well Supplied Heading into Winter - LNG export demand is the primary variable to watch in the U.S. natural gas market heading into winter, according to Marex North America LLC’s Steve Blair, senior account executive. The veteran natural gas futures broker joined NGI Senior Markets Editor Kevin Dobbs on NGI’s Hub and Flow podcast to discuss the outlook for U.S. supply, demand and prices as the storage injection season winds down. On the supply side, “As we all know, production has been elevated for a while now,” Blair said. Natural gas storage levels, meanwhile, “remain well above year-ago levels and…above the five-year averages, so we obviously have plenty of gas on hand. And it seems that the biggest factor in the U.S. domestic market…has been that LNG export...

Coast Guard cleans up oil spill in Casco Bay | WGME -- According to Portland Harbor Master Kevin Battle, a ship was fueling up with 30 to 40 gallons of diesel. When it got into their bilge, the pump turned on and fuel spilled into the harbor. The Coast Guard's pollution response team cleaned the spill up.

USA Government Ordered to Expand Gulf of Mexico Oil Auction - The Biden administration has been ordered by a federal judge to expand its sale of Gulf of Mexico oil leases later this month. The Louisiana-based judge concluded that the Interior Department probably moved wrongly at “the eleventh hour” to yank roughly 6 million acres off the auction block. At issue is the department’s decision last month to shrink the territory up for grabs in the Sept. 27 sale and impose traffic limits on vessels in a bid to safeguard the habitat of one of the world’s most endangered whales. The Interior Department’s Bureau of Ocean Energy Management “failed to justify its pivot,” US District Judge James Cain wrote in a 30-page ruling late Thursday. “The process followed here looks more like a weaponization of the Endangered Species Act than the collaborative, reasoned approach prescribed by the applicable laws and regulations,” he said. Cain ordered the department to conduct the sale including the previously withdrawn acreage by Sept. 30, a deadline imposed under last year’s climate law. The decision is a win for Louisiana, which argued it stood to lose as much as $2.2 million in royalties. Oil industry challengers to the administration’s plan included the American Petroleum Institute, Chevron USA Inc., and Shell Offshore Inc. Chevron had emphasized vessel delays would boost the time and money needed to complete projects in the area. Ryan Meyers, a senior vice president of the American Petroleum Institute, praised the ruling, saying it “hit the brakes on the Biden administration’s ill-conceived effort to restrict American development of reliable, lower-carbon energy in the Gulf of Mexico.” But environmentalists said the order would further imperil the Rice’s whale, a species whose numbers have dwindled to as few as 51. “These baseline protections for the Rice’s whale are quite literally the least we could be doing to save the species from extinction,” Earthjustice attorney Steve Mashuda said by email. “Meanwhile, the government is still enabling the oil industry to bid on 67 million acres of the Gulf. These oil companies are looking at the full glass after one sip and calling it empty.” Earthjustice said it’s considering options for appeal. An Interior Department spokeswoman declined to comment.

Texas Upstream Oil and Gas Employment Figures Rise in August - Employment numbers in the Texas upstream sector during the month of August have jumped from figures reported in July. Citing the latest Current Employment Statistics (CES) report from the U.S. Bureau of Labor Statistics (BLS), the Texas Independent Producers and Royalty Owners Association (TIPRO) said that Texas upstream employment for August 2023 totaled 208,500, which TIPRO said was in increase of 1,200 jobs from July numbers. According to TIPRO’s analysis, Texas upstream employment in August 2023 represented the addition of 18,200 positions compared to August 2022, including an increase of 2,300 jobs in oil and natural gas extraction and 15,900 jobs in the services sector. TIPRO’s new employment data yet again indicated strong job postings for the Texas oil and natural gas industry during the month of August. According to the association, there were 11,951 active unique jobs postings for the Texas oil and natural gas industry in August, including 4,409 new job postings added during the month by companies. In comparison, the state of California had 3,641 unique job postings last month, followed by Louisiana (1,790), Oklahoma (1,609) and Pennsylvania (1,364). TIPRO reported a total of 53,810 unique job postings nationwide last month within the oil and natural gas sector, TIPRO said in its analysis. The top three companies ranked by unique job postings in August were Cefco (933), John Wood Group (543) and Love’s (406), according to TIPRO. Top posted industry occupations for August included first-line supervisors of retail sales workers (612), maintenance and repair workers (544) and heavy tractor-trailer truck drivers (343). The top posted job titles for August included customer service representatives (193), store managers (192) and field service technicians (120). TIPRO further cited data released from the Texas comptroller’s office that Texas energy producers paid $501 million in oil production taxes last month, up from the prior month, and also contributed $137 million in natural gas production taxes, also higher than totals collected in July. Overall, tax receipts from the sector are down from earlier this year, due to a slowdown in drilling activity in some of the state’s top oil and natural gas basins.

Permian, Eagle Ford and Powder River Requests to Develop Natural Gas, Oil Declining -- Permits to develop natural gas and oil in the Lower 48 slumped in August, with the biggest operating area, the Permian Basin, off by double-digits from July and 12% year-to-date. “Permian permitting continues to slow,” down by 407 or 37% month/month (m/m), with year-to-date permits declining by 820, according to Evercore ISI analysts led by James West. Each month the firm updates domestic permitting activity using state and federal data. Exploration and production (E&P) companies pull permits to drill about three to six months before development begins. [Want to visualize Henry Hub, Houston Ship Channel and Chicago Citygate prices? Check out NGI’s daily natural gas price snapshot now.] A total of 1,902 permits was issued nationwide in August, “a 30% decrease on a year earlier...

Oil, gas sector tells US lawmakers increased bond costs are unfair, may backfire | S&P Global Commodity Insights -- In addition to protesting plans to restrict leasing in Colorado and Alaska, the oil and natural gas industry is taking aim at the US Bureau of Land Management's proposal to boost bond costs for leases, telling US lawmakers that it is unfair to impose new costs when there are so few abandoned wells.The current bond rules work and that is why there are only 37 orphan wells on federal lands, Kathleen Sgamma, the president of the Western Energy Alliance, told the US House of Representatives' Committee on Natural Resources Subcommittee on Energy and Mineral Resources on Sept. 19."The numbers show that it is an arbitrary and capricious rule to increase costs so much when the problem is such a relatively small number," Sgamma said during a hearing.The Department of Interior and the BLM on July 20 proposed to rule to raise minimum royalty rates, increase minimum bids and increase the minimum lease bond amount. Under the proposal, the minimum lease bond amount would be $150,000, up from the existing minimum of $10,000.Pete Stauber, the Minnesota Republican who chairs the subcommittee, asked whether the BLM's proposal to increase bond costs and other fees would run the risk of creating more orphan wells by putting small oil and gas producers out of business."As written, if these rules go through, they would put more wells at risk of being orphaned," Sgamma said. "The idea of a surety market and bonding is not to lock up all the capital in the bond, because if you do then you don't have those resources available to actually do the plugging and abandoning work and the reclamation work," she said.But Barbara Vasquez, an advocate for the Western Organization of Resource Councils, says the increased bonding requirements are necessary. The BLM has not increased minimum bonds amount for 60 years, she noted."Over 99% of federal wells carry bonds that are insufficient to cover the full cost of reclamation," Vasquez said. "That means that oil and gas operators are often financially incentivized to skip out of their responsibilities at the end of the economically useful life of wells," she said.Federal wells often remain idled for years or decades before they are declared orphaned and then plugged and reclaimed, Vasquez said. There are more than 2,300 wells that have been idled for more than 25 years, she said. Until they are plugged, these wells have the potential to leak pollutants into the air and water, she said.

How Much Crude Oil Will the USA Produce in 2023 and 2024? | Rigzone --How much crude oil will the U.S. produce this year and next year? Well, according to the U.S. Energy Information Administration’s (EIA) latest short term energy outlook (STEO), which was released last week, U.S. crude oil production will average 12.78 million barrels per day in 2023 and 13.16 million barrels per day in 2024. Broken down quarterly, the EIA sees U.S. crude oil output averaging 12.86 million barrels per day in the third quarter, 12.94 million barrels per day in the fourth quarter, 13.03 million barrels per day in the first quarter of next year, 13.09 million barrel per day in the second quarter of 2024, 13.15 million barrel per day in the third quarter, and 13.36 million barrel per day in the fourth quarter. This production averaged 12.63 million barrels per day in the first quarter and 12.71 million barrels per day in the second quarter, the September STEO highlighted. According to the STEO, in 2023, the Lower 48 states, excluding the Gulf of Mexico, will produce 10.51 million barrels per day, the Federal Gulf of Mexico will produce 1.85 million barrels per day, and Alaska will produce 0.43 million barrels per day. In 2024, the Lower 48 will produce 10.85 million barrels per day, the Federal Gulf of Mexico will produce 1.90 million barrels per day, and Alaska will produce 0.41 million barrels per day, the STEO showed. Lower 48 output is projected to average 10.59 million barrels per day in the third quarter, 10.60 million barrels per day in the fourth quarter, 10.66 million barrels per day in the first quarter of 2024, 10.75 million barrels per day in the second quarter of next year, 10.90 million barrels per day in the third quarter, and 11.06 million barrels per day in the fourth quarter, the report revealed. This production averaged 10.31 million barrels per day in the first quarter and 10.52 million barrels per day in the second quarter, the STEO highlighted. In its previous STEO, which was released in August, the EIA projected that U.S. crude oil production would come in at 12.76 million barrels per day in 2023 and 13.09 million barrels per day in 2024. Lower 48 production was expected to come in at 10.52 million barrels per day in 2023 and 10.81 million barrels per day in 2024, Federal Gulf of Mexico output was expected to average 1.81 million barrels per day this year and 1.87 million barrels per next year, and Alaska production was anticipated to average 0.43 million barrels per day in 2023 and 0.41 million barrels per day in 2024. “We forecast global liquid fuels production will increase by 1.2 million barrels per day in 2023 despite recent voluntary decreases in production from OPEC+,” the EIA noted in its September STEO. “Global production in our forecast increases by 1.7 million barrels per day in 2024. Non-OPEC production is the main driver of global production growth in our forecast, increasing by 2.0 million barrels per day in 2023 and 1.3 million barrels per day in 2024, led by the United States, Brazil, Canada, and Guyana,” the EIA added. “We expect Russia’s production will decline by 0.3 million barrels per day on average this year and remain relatively unchanged in 2024. We forecast that OPEC crude oil production will fall by 0.8 million barrels per day in 2023 and increase by 0.4 million barrels per day in 2024,” the EIA continued. According to figures available on the EIA website, which stretch from the 1850s to 2022 and were last updated in August 2023, yearly U.S. field production of crude oil has never averaged 13 million barrels per day. The highest output figure shown in the data came in 2019, when U.S. field production of crude oil was revealed to have averaged 12.311 million barrel per day. This production came in at 11.911 million barrels per day in 2022, 11.268 million barrels per day in 2021, and 11.318 million barrels per day in 2020, according to the data.

Canada To Start Partial Sale Of Trans Mountain Oil Pipeline --The Canadian federal government expects to start the sale process for the Trans Mountain oil pipeline next week with a meeting with indigenous groups interested in buying a stake, Bloomberg reported on Thursday, citing sources with knowledge of the plans. Around 130 indigenous groups have expressed interest in buying a stake in the pipeline which carries crude from Alberta’s oil sands to British Columbia on the Pacific Coast. Representatives from the federal government and the indigenous groups are set to meet as early as next week to discuss a partial stake sale, according to Bloomberg’s sources.The Trans Mountain pipeline is being expanded, with the aim to triple the capacity of the original pipeline that carries Alberta crude through British Columbia to the west coast of Canada—to 890,000 barrels per day (bpd) from 300,000 bpd.At the start of the project, fierce opposition in British Columbia forced Kinder Morgan to reconsider its commitment to expand the Trans Mountain pipeline. So the Government of Canada reached an agreement with Kinder Morgan back in 2018 to buy the Trans Mountain Expansion Project and related pipeline and terminal assets.Construction on the Trans Mountain Expansion Project was 94% mechanically complete with around 42 kilometers of pipe left to install as of the middle of August 2023.However, the start-up of the expanded pipeline could be set back by nine months unless regulators approve a proposed change of its route. The expansion project, expected to triple the volume of crude shipped from Canada’s oil sands to its Pacific Coast, would intensify competition for Canadian heavy crude in the Midwest, where refiners have so far received discounted crude from Canada. The expansion of the oil pipeline is expected to raise the prices U.S. refiners in the Midwest pay for Canadian oil by up to $2 per barrel, analysts have told Reuters recently.

Oil companies granted licences to store carbon under the North Sea - Oil companies have been granted licences by the government that it hopes will enable them to store up to 10% of the UK’s carbon emissions in old oil and gasfields beneath the seabed.The government awarded more than 20 North Sea licences covering an area the size of Yorkshire to 14 companies that plan to store carbon dioxide trapped from heavy industry in depleted oil and gasfields.The companies include the oil supermajor Shell, Italy’s state-owned oil company ENI, and Harbour Energy, the largest independent oil and gas company operating in the UK’s North Sea basin.The industry’s government-backed regulator, the North Sea Transition Authority (NSTA), claims the companies could help store up to 30m tonnes of CO2 a year by 2030, or approximately 10% of UK annual emissions.The plan to develop old oil and gasfields into vast repositories of CO2 is part of the government’s plan to develop a carbon capture and storage (CCS) industry to reduce emissions from heavy industry entering the atmosphere and contributing to global heating.Stuart Payne, the NSTA’s chief executive, said: “Carbon storage will play a crucial role in the energy transition, storing carbon dioxide deep under the seabed and playing a key role in hydrogen production and energy hubs.”“It is exciting to award these licences and our teams will support the licensees to bring about first injection of carbon dioxide as soon as possible,” he added.Mike Tholen, a policy director at industry group Offshore Energies UK (OEUK), said: “If we get this right, it could not only significantly reduce the UK’s carbon footprint, but position us as world leaders in the low carbon space – creating opportunities for UK people and businesses and playing on our industrial strengths.”

Europe Gas: Prices decline on softer demand, LNG production resumption -- Dutch and British wholesale gas prices declined on Monday morning as demand softened on expectations of stronger wind output and full production resumed at the Wheatstone liquiefied natural gas (LNG) facility after a fault. The Dutch October contract TRNLTTFMc1 was down by 1.20 euros at 35.50 euros per megawatt hour (MWh) by 0803 GMT while the November contract TRNLTTFMc2 was 1.90 euros lower at 43.10 euros/MWh. The British day-ahead price TRGBNBPD1 fell by 5.30 pence to 87.50 pence per therm. Softer demand from power plants due to stronger winds in north-west Europe and higher production forecasts of French nuclear plants were bearish factors. LSEG gas analsysts said German wind speeds are expected to surge tomorrow to 750 gigawatt hours per day which is more than double the seasonal average. Peak wind generation in Britain is forecast at 15.3 gigawatts (GW) on Monday and 17.4 GW on Tuesday, out of total metered capacity of around 22 GW, Elexon data showed. Chevron said on Monday full production had resumed at its strike-hit Wheatstone LNG in Western Australia after a fault last week cut production by about one-fifth. Chevron had said it would maintain supplies from the major LNG terminal in the face of disruptions, which intensified over the weekend as workers escalated their strike action to 24-hour stoppages from brief halts and limited bans on certain tasks. Norwegian flows are nominated higher at 174 million cubic metres (mcm) from 153 mcm on Friday, even though there are several ongoing outages at Norwegian gas infrastructure. The Troll field has another one-day delay to startup. “The Norwegian grid operator has been rescheduling maintenance of the field for the past few days in a row. The field is expected to start production today at up to 20 mcm/d,” said Tomasz Marcin Kowalski, LSEG gas analyst.

Norway becomes top gas supplier to Europe after Russia invasion - In Europe’s rush to wean itself off of Russian energy since the invasion of Ukraine, Norway has become an increasingly important supplier. Last year, the Nordic energy powerhouse became the top exporter of natural gas to Europe, boosting its production by about 8%. And with prices high, government revenues from the oil sector nearly tripled last year. Those inside the industry say conversations and attitudes about the oil and gas industry have shifted since the war in Ukraine started. Jez Averty, a vice president at Equinor, which produces more than two-thirds of Norway's oil and gas, said he believes their product is now seen as more important than it was before the war. "It was probably important before. But it was a lot less visible,” Averty said, adding that sky-rocketing energy prices and energy shortages changed that for many Norwegians. Last year, oil and gas production was named a "fundamental national function," and Averty pointed out some companies were brought under the country's National Security Act. Averty said that this move "illustrates how important, strategically important, the oil and gas industry is now considered both for Norway and how important that is for Europe."

Europe Continues to Lean Heavily on Russian LNG Imports -Europe continues to rely on Russian LNG imports to compensate for the decline in pipeline deliveries from the country, despite calls to ban the super-chilled fuel. For the first eight months of the year, Russian liquefied natural gas exports totaled 20.58 million tons (Mt), according to Kpler. The European Union’s (EU) 27 countries imported more than half of Russia’s LNG exports over that time, or 10.18 Mt between January and August, compared to 10.43 Mt imported for the same period last year. “It may well remain this year as high as last year or be even slightly bigger,” European Union Energy Commissioner Kadri Simson recently told a conference in Warsaw. “We can’t be happy with that.”

Ukraine’s 2023/24 winter gas reserves seen above 15 bcm -Naftogaz chief = The volume of natural gas stored in Ukraine for the 2023/24 winter heating season is likely to exceed 15 billion cubic meters, making imports unnecessary, the head of the state-owned Naftogaz company said on Thursday. Oleksiy Chernyshov told national television the country was unlikely to import gas this winter as it has enough fuel for domestic needs. The country’s energy ministry said this week Ukraine had already met its winter gas storage target of 14.7 billion cubic metres (bcm). Ukraine uses little natural gas to produce electricity but relies on the fuel for heating and industry – sectors vulnerable to Russian strikes that chat could damage critical infrastructure. Ukraine, which was invaded by Russia in February last year, does not import gas directly from Russia, which is a major energy producer and exporter, but Ukrainian pipelines still carry Russian gas to Europe. Ukrainian storage facilities are mainly located in the western part of the country and can store around 30 bcm of gas. Naftogaz said in a separate statement that the company, aiming to cover the country’s needs with domestic production, has brought several new gas wells into operation with a daily output of 1.2 million cubic meters. The company has not disclosed the location of the wells, but most of Ukraine’s gas fields are in the Kharkiv and Poltava regions that have come under frequent Russian missile fire. Ukrainian energy officials have said previously that the country’s gas consumption has fallen by almost 40% due to the war and damage to industrial facilities.

Chevron and unions fail to reach deal on LNG strike - Chevron’s unit in Australia and unions representing its workers on Gorgon and Wheatstone LNG export terminals in Western Australia have failed to reach a deal and end the strike actions. Workers at Chevron’s Gorgon and Wheatstone LNG plants and the Wheatstone platform have started protected industrial action on September 8 after talks between the energy giant and unions ended without an agreement.Moreover, the Offshore Alliance, which includes the Maritime Union of Australia and Australian Workers’ Union, provided Chevron with a notice that work bans may apply for up to 24 hours a day from September 14.The Offshore Alliance said last Friday that “PIA has escalated today on the Chevron facilities and will continue to escalate over the coming days and weeks.” Chevron has been trying to narrow points of difference with employees and their representatives through further bargaining mediated by Australia’s workplace tribunal Fair Work Commission. The company recently asked the FWC to help resolve its ongoing dispute with unions and conciliation sessions continued this week. “No agreement has been reached with the unions following further conciliation sessions held this week with the Fair Work Commission,” a Chevron spokesperson told LNG Prime on Wednesday. “Chevron Australia engaged in meaningful negotiations in an effort to finalize the enterprise agreements with market competitive remuneration and conditions, however, the unions continue to ask for terms significantly above the market,” Chevron’s spokesperson said. “The ongoing lack of agreement reinforces our view that there is no reasonable prospect of agreement between the parties,” the spokesperson said.

Chevron Agrees to Mediator’s Terms in Australian LNG Labor Dispute - Chevron Corp. disclosed it has agreed to the terms of a deal with union workers at its Australia LNG facilities that was brokered by the country’s Fair Work Commission (FWC). Union workers at Chevron’s Gorgon and Wheatstone liquefied natural gas facilities in Western Australia have been escalating tactics since labor action started earlier this month, instituting 24-hour work stoppages and directing members not to load tankers. After union members refused a direct offer from Chevron, the company requested that the FWC mediate negotiations. The two sides were expected to meet for a hearing Friday, but negotiations may end if the unions agree to the terms of the deal presented by FWC member Bernie Riordan.

Chevron Australia, Striking Workers Agree to Terms Proposed by Tribunal Chevron Australia Pty. Ltd. said Thursday it has accepted the recommendation for employment conditions made by Australia's Fair Work Commission (FWC) in the hope of ending a strike that has hit its liquefied natural gas (LNG) facilities. The striking workers at the Wheatstone and Gorgon facilities have also decided to accept the FWC's recommendation after "substantial improvements" in employment terms and will now work with the Chevron Corp. subsidiary to finalize agreements, their union said Friday. The labor tribunal issued Thursday a recommendation laying out employment terms concerning work hours, lodging conditions, allowances, salary, promotion and job security. "The parties are on the precipice of achieving historical first enterprise agreements for these Chevron LNG facilities in Western Australia", FWC Commissioner B Riordan said in the decision posted on the agency's website. "To date, a large number of issues have been settled, on a without prejudice basis, which should form the foundation of enterprise agreements between the parties for the future". Chevron Australia had said it would formally ask the FWC for the government body to exercise its option to enforce its own terms of employment on both the disputing sides after an impasse. Workers at the projects have been on strike since September 8 after they failed to reach a bargaining agreement with Chevron Australia despite mediation by the FWC. Their union, the Offshore Alliance (OA) coalition between the Australian Workers' Union and the Maritime Union of Australia, has accused Chevron Australia of ignoring industry-level demands for employment conditions and insisting on its own terms instead of accommodating a union-initiated enterprise bargaining agreement. However, in a statement emailed to Rigzone on September 11 Chevron Australia claimed the demands were above the market level and that seeing "no reasonable prospect of agreement" between the two sides, the company would apply for so-called intractable bargaining declarations by the FWC. But the OA said in a statement sent to Rigzone Thursday the disputing sides met again last week with mediation by the FWC. And in its own statement sent to Rigzone Thursday Chevron Australia said it has now accepted the employment terms the FWC issued earlier in the day. "Chevron Australia has consistently engaged in meaningful negotiations in an effort to finalize Enterprise Agreements with market competitive remuneration and conditions. Today, we were provided a recommendation from Commissioner Riordan", Chevron Australia confirmed in the emailed statement. "After considering the recommendation, Chevron has accepted the recommendation to resolve all outstanding issues and finalize the agreements", the company said. "We have informed the Commissioner of our position and written to the unions and other employee bargaining representatives confirming our acceptance". The OA also said in a statement sent to Rigzone Friday its members have agreed to accept the FWC recommendation after a meeting on Thursday night. "Offshore Alliance members at Chevron endorsed a recommendation put by the Fair Work Commision at a late night mass meeting of over 350 workers", the emailed statement said. "The proposed enterprise agreements, which incorporate the Commissioner's recommendations, contain substantial improvements in terms and conditions of employment including increased remuneration, job security, locked-in rosters, career progression and returning all employees to a 40 percent roster", the union added. "The Offshore Alliance will now work with Chevron to finalize the drafting of the three agreements and members will soon cease current industrial action". The FWC decision came the same day the OA gathered a majority vote endorsing an enterprise agreement with Woodside Energy Group Ltd., according to a union statement earlier sent to Rigzone Thursday. The OA had planned a strike at the Woodside-operated North West Shelf LNG facility, in which Chevron Australia also has a stake, but called it off after an in-principle agreement was reached, according to a union statement August 24.

Australian LNG Union Workers End Strikes at Chevron’s Gorgon, Wheatstone Facilities - Work stoppages at two of Chevron Corp.’s Australian LNG terminals have ended while union members finalize negotiations with the company after almost two months of labor disputes. The Australian Workers’ Union (AWU), one of two organizations representing offshore and liquefied natural gas workers at Chevron facilities, disclosed Friday that the two labor groups have endorsed a deal backed by Chevron and federal mediators. The Offshore Alliance, a partnership between AWU and the Maritime Union of Australia, “will now engage in drafting discussions with Chevron to ensure that the recommendations from the commissioner are accurately incorporated into the agreements,” the union wrote in a social media post. “During this period, industrial action will cease.”

Big Role for Natural Gas, Oil as World Transitions to Lower Carbon, Says Wood Mackenzie -- Global energy demand is set to rise as income and population grow, with natural gas, oil and coal in 2050 still meeting more than half of total consumption, in part because of the high cost of new technologies, according to Wood Mackenzie. The consultancy’s 2023 Energy Transition Outlook (ETO) highlights the “energy challenge trinity” impacting the world over the next quarter century, which it defines as security, sovereignty and sustainability. “Oil and gas will still have a role to play as part of a managed transition,” Wood Mackenzie’s Prakash Sharma, lead author, said. Sharma is vice president of Scenarios and Technologies Research.

QatarEnergy eyes orders for giant LNG carriers - State-owned LNG giant QatarEnergy is planning a major order of Q-Max LNG carriers at yards in South Korea and China, according to shipbuilding sources. Sources told LNG Prime on Tuesday that QatarEnergy is looking to order about 15 Q-Max LNG carriers at yards in Korea and China. These deals could be finalized by the end of this year, the sources said. The orders could be potentially worth billions of dollars as one 174,000 cbm newbuild LNG carrier is currently worth about $260 million in South Korea and about $235 million in China. Currently, the world’s largest LNG carriers are Qatar’s Q-Max vessels that are about 345 meters long and have a capacity of 263,000-266,000 cbm. Qatar’s Nakilat owns 14 Q-Max LNG carriers built by Hanwha Ocean (DSME) and Samsung Heavy between 2008 and 2010, and they all transport LNG from the giant Ras Laffan LNG complex in Qatar to customers around the globe. QatarEnergy LNG, previously known as Qatargas, currently operates 14 LNG production trains with a capacity of about 77 Mtpa in Ras Laffan. However, QatarEnergy is significantly increasing its LNG production from the North Field. This first phase of the North Field expansion project will increase Qatar’s LNG production capacity from 77 to 110 Mtpa, while the second phase will further boost capacity to total 126 Mtpa. To secure shipping capacity, QatarEnergy reserved slots back in 2020 with three Korean shipyards, including Samsung Heavy, HD Hyundai Heavy Industries, and Hanwha Ocean, and China’s Hudong-Zhonghua. Subsequently, in 2022, QatarEnergy signed multiple time charter parties with various shipowners. Including orders at South Korea’s three shipbuilders and Hudong-Zhonghua, QatarEnergy concluded construction contracts and long-term time charter agreements for 60 LNG carriers last year. QatarEnergy expects the number to grow to more than 100 LNG carriers in the future and the firm is expected to start awarding new contracts as part of the second phase of the shipbuilding program this year. The second phase could include the construction of up to 40 ships but the total number of vessels remains unclear.

China’s monthly LNG imports continue to climb - China’s liquefied natural gas (LNG) imports rose for the seventh month in a row in August, according to customs data.Data from the General Administration of Customs shows that the country received about 6.30 million tonnes in August, a rise of 34.1 percent when compared to the same month last year.LNG imports in August also rose compared to5.86 million tonnes in July.China imported 45.51 million tonnes of LNG during January-August, up by 12.1 percent compared to the same period last year, the data shows.However, Chinese LNG imports fell last year due to due to very high spot LNG prices and Covid lockdowns, which affected economic activity.LNG imports dropped compared to the January-August period in 2021 when China imported51.81 million tonnes of LNG.Including pipeline gas, China’s gas imports rose by 9.4 percent year-on-year to 77.70 million tonnes in the January-August period this year.The country’s pipeline gas imports rose by 10.4 percent in August to 4.56 million tonnes, the data shows.Japan was the world’s top liquefied natural gas importer in 2022, overtaking China, but both of the countries took fewer volumes when compared to the year before.However, China has overtaken Japan in the first half of this year.Japan’s Ministry of Finance has not yet released its data for LNG imports in August.The country’s LNG imports dropped by 17.4 percent year-on-year in July to about 5.09 million tonnes. Japan imported about 37.71 million tonnes of LNG during January-July, some 1.53 million tonnes less than China.

China stored huge volumes of crude oil in August, giving it options (Reuters) - China's record crude oil processing and robust imports in August have painted a bullish picture of demand in the world's largest importer. But what is largely ignored, but shouldn't be, is the vast quantities of oil flowing into inventories. China added about 1.32 million barrels per day (bpd) to either commercial or strategic crude stockpiles in August, according to calculations based on official data. This reversed a rare draw on inventories in July, when refiners processed about 510,000 bpd more than was available to them from imports and domestic production. July was the first month in 13 that China turned to stockpiles, and came at a time when imports dropped as crude prices rose during the period when July-arriving cargoes would have been arranged. This was reversed in August as strong crude imports and steady domestic output outweighed the record refinery processing rates. China doesn't disclose the volumes of crude flowing into or out of strategic and commercial stockpiles, but an estimate can be made by deducting the amount of crude processed from the total of crude available from imports and domestic output. China's refiners processed 64.69 million metric tons in July, equivalent to 15.23 million bpd, according to data released on Sept. 15 by the National Bureau of Statistics. This was up 19.6% from the same month in 2022 and also stronger than July's 14.87 million bpd. Crude imports were 12.43 million bpd in August, the third-highest daily rate on record and up 20.9% from July and 30.9% from August last year. Domestic oil output was 4.11 million bpd in August, which when put together with imports means a total of 16.55 million bpd was available to refiners. Subtracting processing of 15.23 million bpd leaves a surplus of 1.32 million bpd that flowed into storage tanks. For the first eight months of the year China added about 810,000 bpd to inventories, or a total of about 197 million barrels. This means that in theory China could lower imports by about 1.61 million bpd over the final four months of 2023 and still have stockpiles at exactly the same level as they were at the end of 2022.

Iraq-Turkey oil pipeline ready to resume operations soon -Turkish minister Iraq’s northern oil export route through Turkey will soon be ready to resume operation after checks on pipeline maintenance and repairs to flood damage, the Turkish energy minister said. A survey of the oil pipeline is complete and it will soon be “technically” ready for operation, Alparslan Bayraktar said. Turkey halted flows on Iraq’s northern oil export route on March 25 after an arbitration ruling by the International Chamber of Commerce (ICC) ordered Ankara to pay Baghdad damages for unauthorised exports by the Kurdistan Regional Government (KRG) between 2014 and 2018. Turkey then started maintenance work on the pipeline, which goes through a seismically active zone and which it says has been damaged by floods. “As of today, the independent surveyor completed their survey and now they’re preparing their report,” Bayraktar said without mentioning a date for resumption of oil flows, in an embargoed press briefing held by the ministry on Thursday. Iraq and Turkey previously agreed to wait until maintenance works were complete before resuming the pipeline that contributes about 0.5% of global oil supply. Sources said oil flows are not expected to start before October, with KRG losing roughly $4 billion in lost exports. Turkey also calculates Iraq owes $950 million as a result of ICC arbitration, net of damages Turkey has to pay Iraq. Ankara will also file in the Paris court for a “set-aside case”, Bayraktar said. Iraq opened an enforcement case against Turkey in a U.S. federal court in April, to enforce a $1.5 billion arbitration award. “As two neighbouring countries, we need to find an amicable solution. But from the legality perspective, we need to take care of our interests. Most likely in the future we might face another court challenge. But the pipeline will be operational technically. It is more or less ready and we will start the operation soon”,

OPEC Slams The IEA Over Peak Fossil Fuel Demand Claims -- Consistent data-based forecasts show that peak oil and other fossil fuel demand will not happen before 2030, as the International Energy Agency (IEA) claimed earlier this week, OPEC said on Thursday, dismissing the claims of the “beginning of the end of fossil fuels.”Demand for oil, natural gas, and coal is nearing its peak, the head of the International Energy Agency said in an op-ed for the Financial Times on Tuesday, citing IEA research.Noting that demand for oil and gas has been growing despite forecasts of peaks, Fatih Birol went on to say that “according to new projections from the International Energy Agency, this age of seemingly relentless growth is set to come to an end this decade, bringing with it significant implications for the global energy sector and the fight against climate change.”The research, to be released in the IEA’s World Energy Outlook in October, suggests that even if governments do nothing more than they are already doing to curb the consumption of hydrocarbons, demand for all three of them will reach a peak within the next few years, Birol said.In a rare rebuke to energy forecasters, OPEC issued a strong-worded statement on Thursday, saying that “It is an extremely risky and impractical narrative to dismiss fossil fuels, or to suggest that they are at the beginning of their end.”“In past decades, there were often calls of peak supply, and in more recent ones, peak demand, but evidently neither has materialized. The difference today, and what makes such predictions so dangerous, is that they are often accompanied by calls to stop investing in new oil and gas projects,” the cartel said.OPEC Secretary General Haitham Al Ghais also commented on the IEA’s projections and claims, noting that “Such narratives only set the global energy system up to fail spectacularly. It would lead to energy chaos on a potentially unprecedented scale, with dire consequences for economies and billions of people across the world.”OPEC and its biggest members including Saudi Arabia have been warning for years that a rushed energy transition without security of conventional supply, and the underinvestment in the oil and gas industry, would lead to chaos and shortages of supply.In response to the IEA’s claims today, OPEC also said, referring to how net zero policies would impact people’s lives,“How much will they cost in their current form? What benefits will they bring? Will they work as hyped? Are there other options to help reduce emissions? And what will happen if these forecasts, policies and targets do not materialize?”

India's Crude Oil Imports Fell to 10-Month Low in August Due to Production Cuts by Russia -- India’s crude oil imports declined to a 10-month low in August, primarily due to production cuts by Russia and autumn refinery maintenance. The 18.73 million tonnes of imports in August is 4% lower than in July. The imports in August were the lowest since November 2022. However, imports last month were higher on an annual basis by 6% in comparison to August last year. According to Business Line, the Petroleum Planning and Analysis Cell (PPAC) said the imports fell for the third consecutive month in August due to “voluntary production cuts by Russia”, also impacting its most sought-after medium sour grade Ural. Ural imports from Russia to India in August slipped to their lowest levels since January this year. The reduction in imports, traders in India say, is due to smaller discounts on the Urals grade and the decreased appetite on the part of Indian refiners owing to planned autumn maintenance at some refineries. It is also due to reduced domestic demand in the country in the wake of the rainy season until September. Despite the dip in imports, India’s monthly bill on crude oil rose, from $10.3 billion in July to $10.9 billion in August given that production cuts by Russia and Saudi Arabia hiked global crude prices. However, India’s import bill in August was lower on an annual basis. In August this year, Brent Crude was sold at an average of $86.22 per barrel in the global market compared to $80.05 in July 2023 and $99.99 per barrel in August 2022. As for India, the basket crude price was averaged at $86.43 per barrel in August 2023 against $80.37 during July 2023 and $97.40 in August 2022.

India’s imports of Saudi oil in September slump to a multi-year low India’s oil imports from Saudi Arabia in September slumped to a multi-year low of around 5,00,000 barrels per day (bpd), most likely due to Reliance Industries Ltd’s (RIL) impending maintenance shutdown of some units at its Jamnagar refinery complex and Saudi Arabian crudes becoming relatively more expensive than competing grades in the wake of production cuts by Riyadh, according to commodity market analytics and intelligence firm Kpler.So far in September, India’s oil imports from Saudi Arabia have averaged at 4,99,688 bpd, the lowest since November of 2014, as per Kpler data. In August, India’s Saudi Arabian oil imports stood at 8,28,486 bpd, while in September 2022, they were around 8,80,000 bpd. Between January 2022 and August 2023, the import volumes averaged at over 7,50,000 bpd.

Saudi Arabia's crude exports drop to two-year low in July - (Reuters) - Saudi Arabia's crude oil exports in July fell to their lowest for more than two years, data from the Joint Organizations Data Initiative (JODI) showed on Monday. Crude exports from the world's largest oil exporter fell to 6.01 million barrels per day (bpd) in July, down about 11.6% from the previous month's 6.8 million bpd and the lowest since June 2021. Saudi Arabia made a deep cut to its output in July, the biggest reduction in years, on top of a broader OPEC+ deal to limit supply into 2024. Saudi crude output fell to 9.01 million bpd in July, down 943,000 bpd from June, while inventories fell by 2.96 million barrels to 146.73 million. Monthly export figures are provided by Riyadh and other members of the Organization of the Petroleum Exporting Countries (OPEC) to JODI, which publishes them on its website. Domestic refineries processed 3,000 bpd less crude at 2.56 million bpd, while direct crude burn rose by 49,000 bpd in July to 592,000 bpd. The country's oil products exports fell by 203,000 bpd to 1.14 million bpd in July.Saudi Arabia and Russia this month announced they would extend voluntary oil cuts to the end of the year despite a rally in the oil market. Their extension of oil output cuts to the end of 2023 will mean a substantial market deficit through the fourth quarter, the International Energy Agency (IEA) said last week. Meanwhile, Saudi Arabia raised its October official selling price for its Arab light crude to Asian buyer.

Brent Oil Price Highly Likely to Move Above $100 | Rigzone -- We are highly likely to see Dated Brent moving above $100 per barrel. That’s what Bjarne Schieldrop, the Chief Commodity Analyst at SEB, said in a new report, which was sent to Rigzone on Monday. “It is now less than $5 per barrel away from that level and only noise is needed to bring it above,” Schieldrop said in the report. “Tupis crude oil in Asia traded at $101.3 per barrel last week, so some crude benchmarks are already above the $100 per barrel mark,” he added. In the report, the SEB analyst noted that, while Dated Brent looks set to hit $100 per barrel “in not too long”, SEB analysts are skeptical “with respect to further price rises to $110-120 per barrel as oil product demand likely increasingly would start to hurt”. “Unless of course if we get some serious supply disruptions. But Saudi Arabia now has several million barrels per day of reserve capacity as it today only produces 9.0 million barrels per day, thus disruptions can be countered,” he added. Schieldrop highlighted in the report that oil product demand, oil product cracks, and oil product inventories are a good thing to watch going forward. “An oil price of $85-95 per barrel is probably much better than $110-120 per barrel for a world where economic activity is likely set to slow rather than accelerate following large interest rate hikes over the past 12-18 months,” Schieldrop said. The SEB analyst outlined in the report that crude oil prices have been on a “relentless rise” since late June “when it became clear that Saudi Arabia would keep its production at 9.0 million barrels not just in July but also in August - then later extended to September and then lately to the end of the year”. In a statement sent to Rigzone last week, Enverus Intelligence Research (EIR) said it has maintained that Brent prices will reach $100 per barrel by the end of this year “for several months”. “Fundamental data released prior to our deadline of August 31 has been mixed, however, we are reaffirming our call that Brent prices will reach $100 per barrel by the end of this year,” Al Salazar, the Senior Vice President of EIR, said in the statement. In a report sent to Rigzone last week, analysts at Standard Chartered projected that Brent would average $93 per barrel in the fourth quarter of this year. “We do, however, caution that our forecast is a period average rather than a point forecast and hence does not rule out an intra-Q4 high above $100 per barrel,” the analysts said in the report. In that report, the Standard Chartered analysts said “the rally in crude oil prices has continued over the past week, with Brent crude oil setting a series of new year to date highs, with the latest at time of writing $92.38 per barrel”.

Saudi energy minister says oil supply cuts are not about 'jacking up prices' -- Saudi Arabia's energy minister said Riyadh and Moscow's decision to extend crude oil supply cuts is not about "jacking up prices," as Brent futures hover near $95 a barrel and analysts predict further rises into triple digits. "We can reduce more, or we can increase, that has been a subject that we want to make sure that the messaging is clear, that it's not about, again, this jacking up prices," Saudi Energy Minister Prince Abdulaziz bin Salman said Monday at the World Petroleum Congress in Calgary, Alberta. "It's about … making the decision at the right time, when we have the data, and when we have the clarity that would make us in much more of a comfort zone to take that decision." Some members of the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, are implementing 1.66 million barrels per day of combined voluntary declines — which falls outside of unanimously agreed OPEC+ policies — until the end of 2024. Topping this, Saudi Arabia and Russia announced they will apply respective voluntary declines of 1 million barrels per day of production and 300,000 barrels per day of exports until the end of the year. Saudi Arabia is the world's largest seaborne oil exporter and relies on hydrocarbon revenues to support so-called giga-projects designed to diversify its economy. Shrugging off the inertia of the first half of the year, oil prices have gained ground amid supply cut announcements in recent months, as the market braces for a potential volume deficit in the latter part of 2023. ICE Brent crude futures with November delivery were trading at $95.21 per barrel at 5 p.m. London time Tuesday, up 78 cents per barrel from the Monday close price. Front-month October NYMEX WTI futures were at $92.51 per barrel, up $1.03 per barrel from the Monday settlement. The increases have rallied some analysts around speculation of a short-term return to oil prices at $100 per barrel. Asked on the possibility of hitting that threshold, Chevron CEO Mike Wirth on Monday admitted oil prices could cross into triple digits in a Bloomberg TV interview. "Sure looks like it. We're certainly moving in that direction. The momentum, you know, supply is tightening, inventories are drawing, these things happen, gradually you can see it building. And so I think, you know, the trends would suggest we're certainly on our way, we're getting close," he said, acknowledging an impact on the world economy. "I think the underlying drivers to the economy in the U.S. and frankly globally remain pretty healthy. I think it's a drag on the economy, but one that thus far, I think the economy has been able to tolerate." Energy prices have repeatedly underpinned higher inflation in the months since the war in Ukraine and Europe's gradual loss of access to sanctioned Russian seaborne oil supplies.www

The Oil Market Continued on its Upward Trend and Posted a 10-Month High Early in the Day on Supply Concerns -The oil market continued on its upward trend and posted a 10-month high early in the day on supply concerns and weakness in the dollar. However a rebound in the dollar index pushed the oil market to its lows in afternoon trading. The crude market breached its previous high and rallied to a high of $93.74 by mid-morning as the EIA estimated that U.S. oil output from top shale producing regions were on track to fall to 9.393 million bpd in October, the lowest level since May 2023. The market breached the upper boundary of its upward trending channel as it rallied to a level not seen since November. However, the market erased its gains and sold off to a low of $91.13 ahead of the close. The October WTI contract settled down 28 cents at $91.20 and the November Brent contract settled down 9 cents at $94.34. The product markets ended the session mixed, with the heating oil market settling up 8.56 cents at $3.3739 and the RB market settling down 3.98 cents at $2.6581. LyondellBasell Industries said slow economic activity and lack of import demand from China is impacting global supply and demand balances. It said refined product inventories remain low and fuel demand remains stable. It said underlying demand in North America is steady but tepid and added the consumer uncertainty and energy volatility are restraining demand in Europe.Mexico’s Pemex has resumed dealing with Vitol, nearly three years since deals with the world's largest independent energy trader were banned over a graft scandal. The ban followed Swiss-based Vitol's public acknowledgement in December 2020, in a deal with the U.S. Department of Justice, that it had paid kickbacks to win business with Pemex, as well as state companies in Brazil and Ecuador.Russia is pushing more crude onto the market even as it says it will extend supply cuts to the end of the year along with Saudi Arabia. That increased Russia’s seaborne flows to a three-month high. Tanker-tracking data compiled by Bloomberg show that average nationwide shipments in the four weeks ending September 17th increased to 3.34 million bpd, up 465,000 bpd from the period ending August 20th with the increases concentrated at the Baltic ports of Primorsk and Ust-Luga and Novorossiisk on the Black Sea.The OECD forecast that a stronger than expected U.S. economy is helping to keep a global slowdown in check this year but a weakening Chinese economy will prove to be a bigger drag next year. After expanding 3.3% last year, global GDP growth is on course to slow to 3.0% this year. While that was an upgrade from 2.7% in the OECD's June outlook, global growth was expected to slow to 2.7% in 2024, down from its estimate of 2.9% in June.

The Oil Market on Thursday Sold Off in Overnight Trading but Bounced Higher on News of a Russian Ban on Fuel Exports: The oil market on Thursday sold off in overnight trading but bounced higher on news of a Russian ban on fuel exports. The November WTI contract on its first day as the spot contract continued to find some further selling pressure following the news that while the Federal Reserve decided to keep rates unchanged, it said a further interest rate hike was likely by the end of the year. The market extended its previous losses by $1.29 as it posted a low of $88.37 in overnight trading. However, the market retraced its losses and rallied $1.32 as it posted a high of $90.98 by mid-morning on the news that Russia temporarily banned exports of gasoline and diesel to all countries outside a circle of four ex-Soviet states with immediate effect in order to stabilize its domestic market. The crude market later erased some of its gains and traded back below the $90 level in afternoon trading. The November WTI contract settled down 3 cents at $89.63 and the November Brent contract settled down 23 cents at $93.30. Meanwhile, the product markets ended in positive territory, with the heating oil market settling up 4.12 cents at $3.3680 and the RB market settling up 7 points at $2.6199. Platts is reporting that Russia is moving forward with the introduction of a ban on exports of diesel and gasoline. The ban, according to a government decree published Thursday, would include finished grade gasoline as well as summer, intermediate and winter diesel grades as well as heavy distillates including gasoil. The ban though would exclude exports to the Eurasian Economic Union, which include Armenia, Belarus, Kazakhstan and Kyrgyzstan. The measure is aimed at stabilizing pries in the domestic market by helping to increase supplies, while stopping so called grey exports.Iraqi Prime Minister, Mohammed Shia Al-Sudani, said that he envisions an oil price of no less than $85/barrel to $95/barrel. He added that Iraq wanted to keep oil prices steady to "ensure the interests of producers and consumers".U.S. oil refiners that increased processing this year amid increasing demand for gasoline and diesel are being hit by outages weighing on their ability to rebuild thin fuel stockpiles and helping drive up fuel prices. A more than 50% increase in mechanical outages in the first nine months this year combined with higher planned maintenance after a long run of operating at near full capacity has led to tightening fuel supplies and rising prices. A rally in global crude oil prices to more than $90/barrel also has contributed to fuel price hikes nationwide. However, already depleted fuel inventories have come under increased pressure from refinery outages and could set the stage for a resumption of price hikes later in the year.The EPA reported that the U.S. generated 701 million biodiesel (D4) blending credits in August, up from 636 million in July. It also reported that the U.S. generated 1.26 billion ethanol (D6) blending credits in August, down from 1.28 billion in July.

Oil Prices Set For A Weekly Loss As Higher-For-Longer Rates Trump Tight Market - Oil prices were on track to post a small weekly loss early on Friday after the Fed signaled this week that interest rates could remain higher for longer, although it skipped a rate hike at its latest meeting. In Asian trade on Friday, WTI Crude was up by 0.62% at $90.19 and Brent Crude rose by 0.44% to $93.74.Both benchmarks were on track for a small weekly decline, following three weeks of weekly gains, in which prices had jumped by a total of 10% and hit the highest levels since November 2022.Oil prices rose at the start of this week, buoyed by signs of tightening crude and fuel markets and additional draws in U.S. inventories, but the Fed put the brakes on the rally on Wednesday after signaling interest rates could be kept at higher levels for longer.As widely expected, the Fed paused the interest rate hikes at its September meeting but signaled that with inflation remaining elevated despite a fairly strong economy there may be another rate hike later this year.“Higher for longer was the key message” from the FOMC meeting, which has weighed on risk assets, including crude oil, ING strategists Warren Patterson and Ewa Manthey said on Thursday. Even with the pause in hikes this month, the Fed sent a hawkish message.Economic concerns in Europe could also weigh on oil prices in the near term, according to Tina Teng, market analyst at CMC Markets.“Mounting fears of a recession in the Eurozone could continue pressuring oil prices,” Teng wroteon Thursday.Profit-taking after the recent rally has also weighed down on oil prices this week.However, on Thursday, oil prices got a boost from Russia’s decision to temporarily restrict exportsof diesel and gasoline as Moscow aims to stabilize domestic fuel prices.

Oil Products Reverse Lower as UAW Expands Strike, WTI Gains (DTN) -- October RBOB and ULSD futures on the New York Mercantile Exchange reversed lower on Friday on concern over economic growth. November West Texas Intermediate settled higher despite a strengthening U.S. dollar on tightening global supply availability, and November Brent on the Intercontinental Exchange settled flat. ULSD futures swung from a $3.4294 intraday high early session bolstered by Russia's announcement on Thursday that it would suspend diesel and gasoline exports amid strong domestic demand to trade at an intraday low of $3.3045 gallon in afternoon trading after the United Auto Workers expanded a strike at midday, settling the session at $3.3062 per gallon, down $0.0618. October RBOB futures settled down $0.0581 at $2.5618 per gallon. A targeted work stoppage at General Motors, Ford, and Stellantis' most profitable plants that began on Sept. 14 was expanded to 38 plants owned by General Motors and Stellantis on Friday, with UAW President Shawn Fain having previously stated the strike action would expand if significant progress in negotiations wasn't achieved. The expanded work stoppage did not include Ford, with UAW indicating progress in discussions with the automaker. The expanded strike, should it continue, will be detrimental to the U.S. economy, with the Anderson Economic Group previously indicating a 10-day strike against Detroit's Big Three automakers by the 146,000-member UAW could cause a $5.6 billion loss in U.S. gross domestic product and push Michigan's economy into recession. The widening work stoppage comes as the federal government is barreling toward a shutdown, with repeated efforts by the House of Representatives to pass a stopgap budget funding the government past Sept. 30 failing. The White House budget office told federal agencies on Friday to be ready to alert their staff of the potential for a shutdown, with funding for the federal government not approved by Congress beginning on Oct. 1. Although the Federal Open Market Committee sees a path to a soft landing for the U.S. economy when they conclude their current monetary policy tightening, some market observers disagree, believing the potential for another rate hike later this year joined by persistently high inflation could push the economy into recession. FOMC on Wednesday held the federal funds rate unchanged in a 5.25% by 5.5% target range, but most of the voting FOMC officials expect to lift the key bank borrowing rate by 25-basis points in the fourth quarter. Additionally, the Fed's dot-plot shows central bank officials expect the federal funds rate to hold above 5% in 2024, projecting two 25-basis point cuts next year, down from four. The "higher for longer" refrain, now appearing in Fed official's rate projections, contrasted with the accommodative monetary policy that the Bank of Japan voted to continue Friday morning. On Thursday, the Bank of England held its main policy rate unchanged against expectations for a 25-basis point increase, with the combination of these policy decisions strengthening the U.S. dollar. The U.S. dollar index settled 0.21% higher at 105.260 in index trading against a basket of foreign currencies on Friday, trimming an advance to a 105.465 better-than-six-month high. November West Texas Intermediate futures settled above $90 per barrel (bbl) at $90.03, up $0.40, despite the stronger U.S. dollar, although did trim an advance to $91.33 per bbl spurred by a tightening global supply balance. ICE November Brent futures settled down $0.03 at $93.27 per bbl, fading from a $94.64 intraday high. The International Energy Agency projects Saudi Arabia's 1-million-barrel-per-day (bpd) production cut and Russia's pledge to withhold 300,000 bpd in oil exports from the world market through the end of the year will create a 1.2-million-bpd supply shortfall in the fourth quarter. WTI futures also got a price boost on the session after Baker Hughes reported an eight-rig decline in the number of oil rigs deployed in the United States that pressed the U.S. oil rig count to a 507 20-month low on Friday. Goldman Sachs Research this week revised its forecast for oil prices, expecting Brent crude to reach $100 bbl in the next 12 months, up from a previous forecast of $93 per bbl. "OPEC will probably be able to keep Brent prices in a range of $80-$105 next year," said Goldman Sachs Head of Oil Research Daan Struyven. The research team also cited demand growth globally next year led by Asia. "There will likely be more global demand for oil in 2024 led by Asia, as the slowdown in China's economy shows signs of "bottoming out." India and the Middle East are also expected to have large increases in demand," said Goldman Sachs Research.

Iran becomes 3rd top oil producer among OPEC members: report - Tehran Times - Iran continued to increase its oil production in August to reach three million barrels per day (bpd) and stand at the third place among OPEC top producers, according to figures released in the organization’s latest monthly report. OPEC data showed that Iran’s oil output increased by 143,000 bpd or five percent in August compared to production figures reported in July, Shana reported. The figures showed that Iran had regained its position as the third largest oil producer in OPEC in August behind Saudi Arabia and Iraq. Iran posted the largest increase in oil production in OPEC last month, as the country is exempt from output cuts introduced by the alliance to help boost international oil prices. Iranian heavy oil prices rose to $87.58 per barrel in August from $81.48 reported in July, OPEC data showed. The figures prove earlier reports suggesting Iranian oil production and exports had reached multi-year record levels in August despite U.S. sanctions that restrict the country’s ability to engage in normal trade of oil products. Estimates by international energy firms published earlier this month had suggested that Iran’s oil exports were nearly 3.15 million bpd in August as oil exports from the country reached over 2 million bpd. Private refiners in China accounted for a bulk of oil purchases from Iran last month as shipments rose to an all-time record of 1.5 million bpd. Iran’s Oil Minister Javad Oji said earlier this month that Iran’s oil production will reach 3.4 million bpd by late September.