The US and its core allies see rising oil and gas prices as serious economic and political threats to them.

Why OPEC+ will do whatever it can to send oil prices higher

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The relentless drive of OPEC+ to keep driving oil prices higher, as predicted by OilPrice.com some time ago, was seen again in last week’s extension of major additional cuts made to the initial reductions in output first put into place last October. On 3 August, the de facto leader of the OPEC part of the group, Saudi Arabia, announced it will continue the additional 1 million barrel per day (bpd) cut in production that it announced in June through into September at least. Russia, looking to quietly sell its oil at a discount to the OPEC+ rate through backdoor channels, as also analysed by OilPrice.com, said it will taper its 500,000 bpd additional export cut for August to 300,000 bpd in September. These extended cuts come on top of the 3.66 million bpd in collective cuts from the OPEC+ oil cartel implemented since October 2022. The key questions now are: will OPEC+ keep oil prices rising through further production cuts and, if so, what can the West do about it?

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Source: Oil Price

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US oil and gas output still rising in response to high prices last year

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 U.S. oil and gas production continued to rise strongly in March – the delayed impact of very high prices that prevailed until the third quarter of 2022.

Oil output increased by 171,000 barrels per day (b/d) in March compared with February, according to the U.S. Energy Information Administration (“Petroleum supply monthly”, EIA, May 31).

The gains were led by the Lower 48 states (+137,000 b/d) and Gulf of Mexico (+45,000 b/d), which more than offset lower production from Alaska (-11,000 b/d).

Output rose by almost 10% in the first three months of 2023, compared with the same period a year earlier, and was the second-highest for the time of year after 2020.

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Source: Reuters

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The Texas crude WTI Midland’s inclusion in Dated Brent is the most significant overhaul of the measure in decades.

US crude sets world’s most important oil benchmark for first time

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U.S. oil is already having a profound impact on the world’s most important oil benchmark, effectively setting the price just after its inclusion in the measure.

WTI Midland — produced in the West Texas shales — joined the Dated Brent benchmark on Tuesday, in an effort to revamp a gauge that is used to set the price of more than two-thirds of the world’s crude. So far, that integration has proved successful.

bp Plc has been offering the grade for early June at a low level on a pricing window run by S&P Global Commodity Insights, better known by traders as Platts. As prices of the five other grades that comprise the benchmark were much higher, WTI Midland has essentially served as the key price maker.

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Source: Oil & Gas 360

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Production in the oil-and-gas-rich Permian Basin hits records recently, juicing oil company profits and easing energy supply worries.

US Permian Basin oil production — and profits — have surged

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Production in the oil-and-gas-rich Permian Basin of West Texas and New Mexico hit records recently, juicing oil company profits and easing energy supply worries.

It shows U.S. oil companies are responding to higher prices, with increased drilling and pumping after what seemed like months of foot-dragging.

Russia’s invasion of Ukraine generated a global oil shock in 2022. U.S. crude climbed over $120 a barrel back in March, and average gasoline prices jumped to more than $5 per gallon in June.

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Source: AXIOS

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Texas energy expected to be key in meeting global demand

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As 2023 gets underway, the Energy Information Administration is offering its annual short-term energy outlook for the early part of the year.

Among the trends the report has identified are rising natural gas production, increasing liquefied natural gas exports and high winter electricity prices.

So, asked the Texas Independent Producers and Royalty Owners Association, what does this mean for Texas?

“Global production will continue to rise in the coming years and the Permian Basin will play a critical role in meeting energy demand here and abroad,” responded Ed Longanecker, TIPRO president, in an email to the Reporter-Telegram.

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Source: mrt

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