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    Reactions to Delaware Basin news shows misunderstanding of petroleum economics (or the end of OPEC) by Dr. Daniel Fine
    The full article is here-> https://www.daily-times.com/story/money/industries/oil-gas/2018/12/18/delaware-basin-news-reveals-public-misunderstanding-oil-industry-economics/2282224002/ "This writer has warned that world oil demand is sluggish and imprecise with only references to legacy guesswork that the developing world plus China demand will support prices long term or forever. Yet, world oil consumption has increased only 5 percent in the last 10 years.   OPEC, with Saudi Arabia as its leader, has expired as the world administrator of the price of crude oil. At its December meeting in Austria, Qatar quit after nearly 70 years and announced concentration in LNG production and world export as the existing market leader. OPEC emerged with a serious factional split between OPEC original and OPEC with Russia. There would have been no agreement without Russia and its old Russian Federation members as producers. Moscow is the new world oil price-setter indirectly while OPEC Original becomes a collaborator in cartel for now. Simply put, Saudi Arabia no longer is the “residual supplier” alone. The production roll-back of 1.2 barrels per day by both “OPEC” is not enough for “balance” supply and demand for world crude oil.  It is being tested daily by commodity traders. In a briefing to New Mexico independent and small producers before the meeting in Austria, this writer warned that 1.7 million b/d was needed for balancing stabilization. Without that size of a production and export reduction, the average price of WTI oil in 2019 will average $50 per barrel. Nearing 12 million b/d and over the Permian producers voluntarily will be required by this price to revise capital spending and place production into DUC (non-completions) and storage. There is doubt that the export of tight or shale oil would continue if the Brent price falls lower and loses its premium over WTI. A net cutback of Permian between 500,000 to 750,00 b/d should be a non-OPEC response to an oil glut even more serious than 2014. Saudi Arabia is untouched as an American strategic ally in confronting Iran in the Middle East as a hegemonic threat."

    bluewill

    bluewill

    North Dakota – update through October 2018
    These interactive presentations contain the latest oil & gas production data from all 14,162 horizontal wells in North Dakota that started production since 2005, through October. Visit ShaleProfile blog to explore the full interactive dashboards Oil production in North Dakota climbed to 1,392 kbo/d in October, a month-on-month increase of more than 2%, and again a new record for the state. In the first 10 months this year 1,045 wells were brought online, which was more than in each of the two years before.   The 2nd tab (“Well quality”), shows that recent wells are performing slightly better than those from 2017, which recovered on average 160 thousand barrels of oil in the first year on production. In the “Well status” tab you can find the status of all these wells. By selecting the status ‘First flow’, you’ll find that 112 wells started producing in October (vs. 153 in September).   All leading operators have grown production in 2018 (“Top operators” tab). ConocoPhillips has almost taken over the 2nd spot from Whiting.   The ‘Advanced Insights’ presentation is displayed below:   This “Ultimate recovery” overview shows how all these horizontal wells are heading towards their ultimate recovery, with wells grouped by the quarter in which production started. It reveals that the wells that started in Q3 2017, marked by the dark green curve at the top, have shown so far the best performance, although the wells from 2018 are closely tracking a similar path.   The 2nd tab (‘Cumulative production ranking’), ranks all wells (from unconventional reservoirs) by cumulative production. The top 2 wells have produced each more than 1.6 million barrels of oil, and each of them still produces at a decent rate (>100 bo/d). Five more wells have also produced more than 1 million barrels of oil so far. The median well has produced a little below 200 thousand barrels of oil.   The ‘Productivity over time’ dashboard shows clearly how well productivity (as measured by the cumulative oil or gas production in the first x months), has increased in the past few years. We have a similar dashboard in our online analytics service, which allows you to normalize production, and which also shows the trends in well design (lateral length & proppant loading). It offers the possibility to quickly compare the performance of operators over time, in relation with how each has changed its completion practices. We will have a new post on the Marcellus just after Christmas. In our chat on enelyst, tomorrow (Dec 18th) at 10:30 am EST, we will take a closer look at the Bakken. If you are not yet an ign up for free at: www.enelyst.com, using the code: “Shale18”.enelyst member, you can s For these presentations, I used data gathered from the following sources: DMR of North Dakota. These presentations only show the production from horizontal wells; a small amount (about 30 kbo/d)  is produced from conventional vertical wells. FracFocus.org   Visit our blog to read the full post and use the interactive dashboards to gain more insight http://bit.ly/2SRAuN9   Follow us on Social Media: Twitter: @ShaleProfile
    Linkedin: ShaleProfile
    Facebook: ShaleProfile

    shaleprofile

    shaleprofile

    OPEC in crisis
    We where supposed to have a deal on Thursday with OPEC so what happened? If you found a good deal on a house, would you delay the closing? You would if you saw some problems with the deal. Well what kinds of problems do we have with OPEC cutting productions and why wasn't it made today, after all the whole world is waiting. For the prices to stop going into a free fall and hit my $34 target, they need to cut production, Saudi by about 2 Mill barrels and Russia by 300,000 barrels, or at least 200,000 barrels. Well Russia did not have an answer today? Why? Well lets see where Russia Oil fields are?  Well this looks like a very cold place, if im not mistaken it gets to -70 Celsius in the winter. Ok so whats the problem? If you live in Northern Canada, you know you need to not turn off your heat in the winter to your pipes wont freeze. Well guess what, Russia won't be able to cut production in the winter, and it will need to wait until temps are above freezing, maybe March / April 2019.  So that means Russia wont be able to cut, so why should the Saudis cut, so they will cut im comparison with Russias cuts, which wont be enough to stop the fall of Crude Prices.

    Top Oil Trader

    Top Oil Trader

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