Monday, August 31, 2020

U.S. Crude Oil Inventories Decrease by 4.7 Million Barrels

China Increases Storage of Strategic Petroleum Reserves

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 4.7 million barrels from the previous week. At 507.8 million barrels, U.S. crude oil inventories are about 15% above the five year average for this time of year, according to the EIA crude oil and petroleum weekly storage data, reporting inventories as of August 21, 2020.

Summary of weekly petroleum data for the week ending August 21, 2020

U.S. crude oil refinery inputs averaged 14.7 million barrels per day during the week ending August 21, 2020, which was 225,000 thousand barrels per day more than the previous week’s average. Refineries operated at 82.0% of their operable capacity last week. 

Thursday, August 27, 2020

Copper climbs near two-year high as inventories fall, China demand rises


Codelco Chuquicamata Copper Smelter 

Copper prices (HG1:COM) closed +1% to $6,594/ton, pushing near two-year highs reached earlier this month, as London Metal Exchange inventories fell to the lowest in 14 years and China enjoys its strongest copper demand in three and a half years.

"There is more bullishness about the state of the global economy" and inflation likely will rise, says WisdomTree analyst Nitesh Shah, who also believes prices will increase further.

Copper inventories in LME-registered warehouses at more than 92K metric tons are the lowest since 2006 and down from more than 280K tons in May.

Also, protests at Freeport McMoRan's (NYSE:FCX) Grasberg mine in Indonesia, the world's second largest copper mine, continued for a third day, disrupting operations.

Citi analysts say China's 8.6% Y/Y copper demand growth in July was the highest since February 2017 and has broadened beyond the construction sector that initially led the rebound.

Citi recently forecast copper will hit $6,800/ton in the next three months, citing likely progress on coronavirus treatments, U.S. policy easing and sustained strength in China's economy.


Hurricane Laura impact on energy markets 

HOUSTON (ICIS)--As Hurricane Laura is barrelling down toward the US Gulf Coast and expected to make landfall this week, numerous LNG export plant and refinery operations are disrupted as producers make preparations ahead of the storm.

Follow this Topic Page to stay up to date with the latest insights and breaking-news updates on the impact from Hurricane Laura on the oil, gas and LNG markets.

Wednesday, August 26, 2020

Oil tankers stripped of flags after breaching U.S. sanctions to secretly ship Iranian oil



Crude Oil Tanker, IMO: 9246279, MMSI: 341798000

A maritime research firm described a complex “ballet” performed by Iranian and foreign vessels to flout U.S. sanctions.

LONDON — Four oil tankers have been stripped of their flags following an NBC News investigation into allegations they secretly transported Iranian oil in defiance of crippling U.S. sanctions imposed by President Donald Trump.

The four ships all made covert visits to Iranian waters this year where they collectively picked up millions of barrels of oil, according to data from Tanker Trackers, a maritime research firm.

The trips were part of what Tanker Trackers describes as a complex “ballet” performed by Iranian and foreign vessels, in which ships manipulate their tracking data to hide their involvement in flouting U.S. sanctions.

A July 31 report from NBC News featured 15 ships, including four — the Giessel, the Ekaterina, the Lerax, and the Amfitriti — that were sailing under the flag of the Caribbean island state of St. Kitts & Nevis.

Five days after the report was broadcast, the St. Kitts & Nevis Ship Registry decided it would no longer allow the tankers to fly under its flag.

Under maritime law, seagoing ships must fly the flag of a nation state. Vessels that have been stripped of their flag are unable to carry out basic functions like sailing into port or registering for maritime insurance.

“The St. Kitts & Nevis International Ship Registry takes any violations of imposed sanctions very seriously and will act swiftly and effectively to deal with infringements involving any vessels flying its flag,” the registry said in a statement emailed to NBC News. “Such was the case with the tanker Giessel which was de-flagged on August 4th following press reports that it had visited an Iranian port.”

A registry spokesman confirmed the three other ships had also been stripped of their flags.

Public records from the International Maritime Organization show that the four ships are no longer under the St. Kitts & Nevis flag. Their nationality is now listed as “unknown.” While they may be able to eventually register again with a new state, the loss of their flags is likely to hinder their movements in the short term.

The maritime organization’s records reveal a complex web of companies responsible for the ownership of each of the ships. But three of the vessels are ultimately under the care of the same firm, an Indian company called Floretta Ship Management. The fourth ship is linked to another Indian company, Ravel Ship Management.

Tuesday, August 25, 2020

Port of Corpus Christi Still Aims to Export Canadian, Bakken Crude

port of corpus christi 

Port of Corpus Christi

The Port of Corpus Christi surpassed Houston late last year as the nation’s top crude exporter, and now the rapidly growing petroleum hub aims to take the next step by shipping out grades of Canadian crude and Bakken Shale oil.

There’s just one key, but obvious, holdup: a coronavirus pandemic that crippled global oil demand and triggered a wave of pipeline construction deferrals.

Thanks to a wave of long-haul crude pipelines connecting the Permian Basin to Corpus Christi that came online in 2019 and 2020 — Cactus II, EPIC and Gray Oak — the port is still shipping out an average of more than 1.5 million b/d in crude oil to the rest of the world in 2020, according to Port CEO Sean Strawbridge, speaking remotely on Aug. 19 at EnerCom’s The Oil & Gas Conference.

But, in order to keep growing, he said, Corpus Christi also needs access to crude grades from outside of Texas and New Mexico, especially those from North Dakota and Canada. And the only way to make that a reality is connecting Corpus to oil storage hubs in Cushing, Oklahoma and, to a lesser extent, nearby Houston, which Strawbridge described as somewhat congested.

“We do not have access to those crude slates today,” Strawbridge said, noting that the port may have to further defer expansion and capital spending plans if potential pipelines don’t become a reality.

The big one that the port was — and still is — counting on is the Red Oak Pipeline by Phillips 66 and Plains All American Pipeline that would move 400,000 b/d from Cushing to multiple Texas port hubs in Houston, Corpus Christi and Beaumont.

However, earlier this year, the pandemic triggered Phillips 66’s decision to indefinitely defer a decision on building Red Oak and two other pipeline projects until 2021, if not longer. Red Oak was originally planned to be built and in service in the first quarter of 2021.

On Aug. 19, Phillips 66 spokesman Dennis Nuss reiterated that Red Oak remains deferred, declining further comment.

Wait for it
During the Phillips 66 earnings call on July 31, Executive Vice President Tim Roberts discussed pipeline project deferrals as coronavirus cases continue to hold steady or rise in much of the country, although he didn’t specifically cite Red Oak.

“All those things have caused us to pause. And you’ve seen that through our actions like deferring a couple of our projects,” Roberts said. “We need more clarity. I think our producers need more clarity, shippers need more clarity. So, we need to get a view on that.”

Ultimately though, he said he still expects “good projects” to eventually move forward.

“We’re certainly going to be a little more cautious as we look at transmission lines,” Roberts said. “But that doesn’t mean we’re not going to do those. We’re going to make sure it makes sense.”

And US crude shipments are slowly rebounding during the pandemic. Most recently, in mid-July, Buckeye Partners started exporting crude from its brand-new South Texas Gateway terminal at the Port of Corpus Christi.

US crude exports averaged an all-time high of 3.71 million b/d in February, according to the US Energy Information Administration, before falling below 3 million b/d in May and June.

S&P Global Platts cFlow data estimates US crude exports rose back up to 3.71 million b/d for the week ending Aug. 14. However, in a sharp contrast, the EIA only reported 2.14 million b/d in crude exports for the same week, down from 3.14 million b/d the week prior.

The two crude export projections have increasingly diverged in their estimates since mid-June with cFlow consistently counting higher volumes. However, this week was by far the greatest difference yet. One factor could be the EIA not fully factoring in crude shipments that are still going into floating storage without set destinations. 

Friday, August 21, 2020

Iraq is open for U.S. business, prime minister says; Trump eyes oil prospects

Trump redoubles vow to withdraw troops from Iraq; eyes prospects ...

U.S. President Donald Trump receives Iraq's Prime Minister Mustafa al-Kadhimi in the Oval Office at the White House in Washington, U.S., August 20, 2020. Iraqi Prime Minister Media Office/Handout via REUTERS 

WASHINGTON, Aug 20 (Reuters) - U.S. President Donald Trump on Thursday said U.S. companies were involved in many prospects in Iraq’s oil business, as Iraqi Prime Minister Mustafa al-Kadhimi declared his country open for American business and investment.

Trump told reporters before a meeting with the Iraqi leader that the U.S. military had very few troops left in Iraq, but was there to help the country if neighboring Iran should do anything.

Saudi Aramco suspends plans for $10b refinery in China

Saudi oil Aramco refinery

Saudi Aramco is intent on saving on costs as much as possible, which is why it won't be pressing ahead with a planned $10 billion petrochemical complex in China. Image Credit: AFP

Saudi Aramco suspends plans for $10b refinery in China

Riyadh: Saudi Arabia's state oil company has suspended a deal to build a $10 billion refining and petrochemicals complex in China, as the company slashes spending to cope with low oil prices.

Saudi Aramco decided to stop investing in the facility in China's northeastern province of Liaoning after negotiations with its Chinese partners. The uncertain market outlook was behind the decision.

China North Industries Group Corp. and Panjin Sincen were to be the other partners.

The oil-price crash and the virus's impact on energy demand have changed the calculations for energy companies' projects. Aramco plans deep cuts to its capital spending as it tries to maintain a $75 billion dividend amid low crude prices and rising debt. The kingdom - Aramco's main recipient of those dividends - is suffering a major squeeze on its public finances.

The joint venture was signed when Crown Prince Mohammed bin Salman was in Beijing in February last year - and at the time was seen as a landmark deal with a key ally. Saudi Arabia wanted to increase market share in Asia and also has encouraged Chinese investment in the kingdom.

Lots of fanfare

The Saudis were set to team up with Norinco and Panjin Sincen to form an entity called Huajin Aramco Petrochemical Co. The kingdom was going to supply as much as 70 per cent of the crude for the 300,000-barrel-a-day refinery.

The Chinese side will press ahead with the project, which also includes an ethylene cracker and a paraxylene unit. And the joint venture remains an option for the future.

Refiners have taken a hit as the virus curbed demand globally and margins have been squeezed. That's changed the investment case for the refining business. Saudi Aramco had also been in talks with Indonesia's state energy company Pertamina earlier this year over a refinery expansion project, but negotiations ended without an agreement and Pertamina is looking for another partner.


Thursday, August 20, 2020

Iraq agrees oil tanker deal with Norway's Batservice Mandal: minister

 Iraq's new oil minister Ihsan Abdul Jabbar Ismail

Iraq's Oil Minister Ihsan Abdul Jabbar Ismail 

CAIRO (Reuters) - Iraq has reached an agreement with Norwegian shipbuilder Batservice Mandal over the construction of two oil tankers with capacity of 30,000 tonnes each, Oil Minister Ihsan Abdul Jabbar said on Tuesday.

The tankers will be delivered in 18 months and are part of the ministry’s efforts to rebuild an Iraqi tanker fleet that has been depleted during decades of war, Abdul Jabbarsaid in a statement.

Reporting by Samar Hassan; Writing by Ahmed Aboulenein; Editing by David Goodman


Wednesday, August 19, 2020

Why Warren Buffett is betting on energy pipelines even as climate fears, and renewables, are rising

A floorhand works on an oil rig in the Bakken shale formation outside Watford City, North Dakota.
Getty Images 

  • Major oil and gas pipeline projects have faced regulatory and political roadblocks forcing them to halt production or cancel new development. 
  • The recent crude oil crash led to a steep reduction in U.S. rig count and as the shale boom contracted amid a weaker global economy, pipeline capacity was overbuilt.  
  • But even as climate change pressures the fossil fuel industry, natural gas is not going away, say energy experts, with gas making up 40% of power generation, growing LNG export markets and more-friendly drilling regions in states like Louisiana and Texas. 

With the coronavirus pandemic slashing demand for the oil and gas that has been booming in the U.S. shale during the past decade, energy pipeline development has stalled. The midstream portion of the energy complex, as it is known, may not recover soon, but it will recover, according to energy experts, and none other than Warren Buffett — who has been uncharacteristically shy about making investments during the Covid-19 washout — is betting on that. The billionaire investor recently plunked down near-$10 billion to buy gas pipeline assets and related debt.

After a decade of capacity buildout in the pipeline infrastructure to match the U.S. fossil fuel fracking growth, demand is lacking and will stay down, despite a doubling in the price of crude following sub-$20 lows reached in March.

“The midstream is in a tough spot,” said Luke Jackson, senior analyst, natural gas, North America, S&P Global Platts. “You have to consider what drove the infrastructure development: the shale boom. When you look at oil near $40 and natural gas rising, but still sub-$3, we’re not in a climate where higher production of oil and gas is supported to support a larger build out,” Jackson said.

Before Covid-19 hit, Platts Analytics was forecasting U.S. crude oil production to rise by one million barrels per day year over year, and rise by another 600,000 barrels in 2021. Now, as rig counts have declined at the steepest rate since 2009 — 75% of natural gas production comes from the “associated gas” at oil rig sites, as well — crude production is expected to register an annual decline within the next few months, and that decline will persist until at least mid-2021, according to Platts Analytics’ forecast. 

Instead of the substantial growth that midstream companies had been making investment decisions based on — and which led to a significant number of pipeline projects coming online within the past two years — major shale basins like the Permian will see lower utilization of outbound pipelines for the next few years.



“We’re not expecting U.S. crude to return to levels we were at in Q1 2020 until 2023,” said Jenna Delaney, lead analyst, North American oil, S&P Global Platts. “It will be even a few more years until we get back to where we started from, and then to satisfy pipeline capacity, we will need even more production growth.” 

But there’s more going on then just a typical commodities boom-and-bust cycle. With successful environmental challenges leading to legal and regulatory roadblocks for pipelines, and a political climate becoming more difficult for fossil fuels, companies in the utility sectors are rethinking their midstream investments, and in some cases, reallocating funds towards renewable energy projects. 

Earlier this summer, the Energy Transfer-owned Dakota Access Pipeline, which runs from North Dakota to Illinois storage facilities and the Gulf Coast, was forced by a federal judge to shut down production pending further environmental impact reviews by the Army Corps of Engineers. The halt in production resulted in a major win for the Standing Rock Sioux Tribe, which has been fighting a legal battle against the pipeline operating and transporting oil for nearly three years.

“I’m not aware of a pipeline that’s been forced to shut down mid-production, that obviously concerns people in the industry,” said Pearce Hammond, managing director and equity research analyst for midstream and infrastructure at Simmons Energy. “It just shows how difficult it is to get a pipeline built in the U.S. because of regulation, environmental concerns, and with environmentalists pushing against it.”  

Dominion Energy and Duke Energy announced the cancellation of the Atlantic Coast Pipeline due to “legal uncertainties” surrounding the project. The cost of the project had increased from nearly $5 billion to $8 billion, amid ongoing legal battles surrounding permits and environmental issues.

In a separate capitulation, last month Dominion sold its natural gas pipeline assets to Warren Buffett’s Berkshire Hathaway in $9.7  billion deal that included close to $5 billion in pipeline assets, as well as assumption of debt.

Why Buffett is bullish on gas

According to Steve Fleishman, managing director and utilities analyst at Wolfe Research, Buffett’s acquisition will provide a steady stream of revenue and a quality asset, regardless of the lack of midstream development. Buffett also has always preferred investments in a market where more control is reasonable to expect — lack of new pipeline supply could be a plus as far as his preference for less competition likely to come into the market. The Dominion gas pipeline and storage assets include operations in Connecticut, Maryland, Ohio, West Virginia, Pennsylvania, New York, Maryland and Virginia.

The deal won’t burn a hole in his pocket, either, with Berkshire sitting on well over $100 billion in cash and short-term assets, and Buffett always anxious to deploy the capital into projects that generate a return on investment.

It’s not just the political optics, though that plays into the shift highlighted by Dominion away from midstream. The market has been downgrading the value of gas pipeline assets owned by utilities. Even with one of the biggest utility operations in the U.S., Berkshire’s cash hoard can operate like a private equity buyer flush with cash., Stand-alone utilities, meanwhile, are increasingly focused on environmentally sensitive portfolios, according to Sophie Karp, KeyBanc Capital Markets utilities and renewables sector analyst.

“We’ve seen in the past year, even before Covid, that the premium commanded by gas assets evaporated,” Karp said. “The market was saying that it doesn’t want utilities to own gas assets.”

Morningstar analyst Gregg Warren projects that the Dominion pipeline assets will generate $1 billion in earnings before interest, taxes and depreciation and amortization, for Berkshire Hathaway Energy’s pipelines unit, which will see mid-single-digit EBITDA growth. The $9.7 billion deal was estimated at a price of 9.7 times EBITDA, a price that Dominion management defended as being above recent, similar transactions.  

Assets like the ones Dominion sold to Berkshire are harder for utilities to justify given the push among constituents to decarbonize. “The incremental investor in utilities is more environmentally conscious than the incremental investor in Berkshire,” Karp said. Referring to sensitive bases of ratepayers in regions around the country where utilities are regulated and resistance to fossil fuels are growing. she added, “A suburb in Boston will not make or break a utility, but it could be a  precursor to ‘a death by a thousand cuts,’ where each incremental rate case there is more severe opposition to capex that is not decarbonized.”

“It’s not ‘tomorrow we stop using gas,’ but it is a plausible scenario where it gets harder and harder for a utility to put dollars into that infrastructure and derive earnings growth,” Karp said.  

The utilities’ market dynamic partially explains why Buffett was able to make the deal without paying a hefty premium. “It wasn’t the top of the market,” the KeyBanc analyst said. “It sold at the peer group average at a time when the average was down ... but Dominion was trying to rip the Band-aid off.”

Dominion is moving in another direction, with significant offshore wind opportunities in some of its markets, like Virginia.

“That may be more attractive than gas, and when can redirect the capex and get a return on that, and not deal with gas ownership, it looks like a solid move,” Karp said.

Dominion pointed to the “state-regulated nature” of its business profile as one of the reasons for the deal, as well as noting its net zero target by 2050 for both carbon and methane emissions, and $55 billion planned in next 15 years for emissions reduction technologies including zero-carbon generation and energy storage.

Utilities owning midstream gas assets outside their core business will be slowing down as a business focus, with the premiums formerly commanded no longer available. Utility stocks did well in recent years, but “the stocks have not done well on mistream deals,” Karp said. “The trend will be utilities looking at divesting, not investing more. ... But natural gas as a fuel is not going away in our lifetime. The long-term use case is there.” 

Concerns about future oil and gas capacity

With declining access to domestic oil supply as midstream development cease, some analysts worry about the potential for energy security risks and the U.S. becoming again reliant on foreign exporters, such as OPEC.

Hammond at Simmons Energy said the recent regulatory hurdles in the oil and natural gas markets could ultimately mean, “you’d be relying on increasing very insecure sources of supply, which is something we’ve tried to move away from in terms of energy security, turning the clock back to the 70′s, 80′s.”

“The policy makers are trying to balance the transition to lower carbon and meet the needs now while still being energy secure,” he said.


“Certainly, if we see muted or no U.S. production growth, when demand continues to recover globally, we’re gonna have to be more reliant on foreign imports that we would have been, certainly seeing energy security issues,” said Leo Mariani, energy stock analyst at KeyBanc Capital Markets. 

But in the mid-term, what is maybe more likely is a bifurcation in the U.S. pipeline market, as U.S. oil and gas production growth comes back, rather than a return to the OPEC-dictated era.

Platts expects U.S. production growth to start recovering for U.S. shale by 2023, and does not expect midstream constraints, especially as Canadian crude continues to flow into the U.S. and the export market for liquified natural gas continues to grow.

“We do believe that the U.S. will need more infrastructure development to support higher movement of gas to markets in the Gulf Coast, in East Texas and Louisiana,” Platts’ Jackson said. 

The situation in markets like the Northeast and its big population centers will be more challenging for building pipeline.

“It will be much easier to build pipelines in certain areas,” said Eric Brooks, Northeast US natural gas analyst, S&P Global Platts. “In the Northeast, it’s a more intense regulatory environment and that does come back to politics. Atlantic Coast Pipeline was emblematic and it is no secret it is challenging environment.”

Broader market shift to renewables

What is happening at Dominion is also occurring within the oil and gas industry. BP recently took a step that would have once been considered unthinkable when it reported a loss of $6.7 billion — the oil and gas giant halved the dividend that has long been coveted by pension fund investors and committed to a new strategy of increasing investments in renewable energy and cutting oil and gas generation by 40%.

Equinor, the Norwegian petroleum company formerly known as Statoil, also is transitioning its business model to include more renewable energy, including offshore wind projects as its primary way to accelerate a transition to low-carbon energy sources. The changes, though, are less than absolute: Equinor’s near-record breaking offshore wind project will provide renewable energy to oil and gas platforms.

“They can see clearly that something needs to be done about climate change,” said Andrew Grant, head of oil and gas for Carbon Tracker, a think tank that focuses on the financial and market implications of climate change. “An increasing numbers of countries around the world have set zero targets .... we’re going to need other alternatives and less fossil fuels, and companies understand that, and they want to build in some future-proofing ... to build out some of those energy sources. They’re stuck between that and the fact they have a very long history of producing oil and gas fields,” Grant said.

A report from Rystad Energy forecasts the global number of drilled oil wells to be at 55,350, the lowest number of wells since the early 2000s and a 23% decline in the number of wells drilled in 2019. Even further, North American drilling is expected to remain 50% lower than last year’s levels. 

“A lot of pressure is coming through from all stakeholders, consumers, and civil society, but also investors, especially in the past few years. Investors realize there is a risk and they want to be reassured. It has become clear that oil and gas companies have underperformed in the market. Investors realize that the world is going to decarbonize,” Grant said.

For Dominion, the business model is changing more quickly.

“They made a decision to exit this midstream pipeline business because they basically felt that it [renewable energy] would be a better business, it would basically accelerate the transition of the company to clean energy, For them, it’s a pretty big strategic bet they made,” Fleishman said. “They’re making a bet the new model of the company will have better growth and better financial strength and more focus on clean energy will get a higher valuation.” 

Even as he increases his pipelines footprint, Buffett’s utility has been making a considerable shift. It is already one of the biggest wind energy producers in the U.S. through its MidAmerican Energy utility affiliate based in Iowa, while its NV Energy in Nevada plans to increase its renewable generation to a percentage in the high 40s by 2023, mostly using geothermal and solar power.

Some make the case that the Buffett pipeline buy is about electric vehicles playing a bigger role in the future. But in a broader sense, Buffett has parted ways with a strict decarbonization investing philosophy in a core belief that he outlined to Berkshire shareholders who were concerned about climate change back in 2014. Buffett said that whether the investment decision was about Berkshire Hathaway or “virtually all the companies I can think of,” he didn’t believe that “climate change should be a factor in the decision-making process.”

Additional reporting by Eric Rosenbaum

Tuesday, August 18, 2020

China thirsty for US crude oil after record refinery action


Image Source: 

China refineries processed a record amount of crude oil last month, and now they are looking to the U.S. to find crude.

China is looking to book oil tankers for August and September to ship at least 20 million barrels of U.S. crude, according to Reuters. The move comes as there is increasing pressure on the Chinese to fulfill their commitments to the Phase One U.S. China trade deal as they lag in the purchase of many U.S. commodities. The move by China to ramp up oil purchases comes right ahead of the review of the U.S.-China trade deal, initially slated for Saturday, which was delayed due to scheduling issues with no new date agreed upon.

The move by China by U.S. crude is a positive sign for the fate of global trade. Still, the irony is that it may not immediately help U.S. oil producers and may make our own oil inventories very tight. It was not too long ago when U.S. energy producers were begging China to buy our abundant supply, but now not so much.

U.S. oil inventories are starting to fall. In part, because many U.S. oil producers have been squeezed out of business by the recent coronavirus oil price crash, or existing companies lack the capital to increase production. Since the COVID-19 pandemic, U.S. oil production has seen a drop of well over 2 million barrels per day. That is the most significant drop since they have been keeping records. The OPEC Plus production cuts have also taken their toll on U.S. oil supply leading to the biggest three-week drop in Gulf Coast crude supplies in history. That means that U.S. oil supplies were already falling, and the major purchase of oil by China may cause a spike in U.S. energy prices when we get closer to the winter heating season.

Yet a move by the Trump administration may ease that short squeeze after the administration successfully seized Iranian fuel from four tankers sailing to Venezuela, increasing its “maximum pressure campaign” against Tehran, a senior U.S. official confirmed for Fox News on Thursday evening. Iran and Venezuela have tried to outmaneuver sanctions that the U.S. has placed on both countries by forming an oil partnership. The confiscated cargo, first reported by the Wall Street Journal on Thursday, was a direct violation of U.S. sanctions. A senior official clarified that the tankers were not seized, but the oil is now in U.S. possession.

It’s probably a good thing that the U.S. seized that oil because now we can turn around and sell some of it to China.

That extra oil should come in handy as our supply tightens.

Monday, August 17, 2020

NNPC Records 43% Drop in Oil Pipeline Vandalism in May 

Nigerian National Petroleum Corporation (NNPC) has recorded an encouraging 43 percent drop in cases of willful damage of its oil pipeline infrastructure by suspected oil thieves in May, 2020.

The corporation, in a release by its Group General Manager, Group Public Affairs Division, Dr. Kennie Obateru, explained that details of the report contained in the May 2020 version of the NNPC Monthly Financial and Operations Report (MFOR) indicated that 37 pipeline points were vandalized representing about 43 per cent decrease from the 65 points recorded in April 2020.

A further breakdown showed that Mosimi-Ibadan pipeline axis accounted for 38 percent of the vandalized points while Atlas Cove—Mosimi axis recorded 19 percent of the breaks. Suleja-Kaduna logged 16 percent of the breaks, while other locations make up for the remaining 27 percent.

NNPC stated in the May report that in collaboration with the local communities and other stakeholders, it would continuously strive to bring the malaise under control.

Saudi Aramco to Press Ahead with Oil Output Capacity Boost, Says CEO

Crown Prince Mohammed bin Salman controls most levels of power in the country and has been defence minister since 2015 when his father ascended the throne. 

 Crown Prince Mohammed bin Salman controls most levels of power in the country and has been defence minister since 2015 when his father ascended the throne. (AFP)

Oil giant Saudi Aramco is moving ahead with plans to boost its oil output capacity by 1 million barrels per day (bpd) to 13 million bpd despite spending cuts this year and next year, its chief executive said on Monday.
Aramco’s capital spending plan for 2021 will be “significantly lower than previous guidance”, CEO Amin Nasser also said on an analyst and investor call after the company’s quarterly results.

The previous capital spending guidance was $40 billion to $45 billion. 

Sunday, August 16, 2020

Automobile energy costs for each state / Should you buy a car that runs on gasoline or electricity?

Choose Energy White Logo 

Which states are the most energy-cost efficient for drivers? That depends, of course, on whether a motorist is operating a traditional gasoline-powered vehicle or an electric vehicle. Which means there are multiple answers to that question of vehicle energy-cost effectiveness, and the answers can and do change each month.’s Driving Fuel Costs by State page monitors monthly costs to show you the latest statistics, trends and analysis of the costs to drive traditional vehicles and electric ones. Choose Energy analysts crunch numbers provided by AAA, the Department of Energy and other sources to measure differences by state.

Let’s start with gasoline. As of July 31, drivers in the U.S. paid an average of $2.18 per gallon for regular gasoline, according to AAA. That was 41 cents less per gallon than on Jan. 1.

Which states had the most and least expensive gasoline?

Drivers in Hawaii paid the most for their gasoline on July 31 – $3.24 per gallon. That was 0.6 percent more than they paid one month earlier but still  48.6 percent more than the national average. Drivers in Mississippi paid the least per gallon on July 31 – $1.84.

Following are the states where drivers paid the most and least for gasoline on July 31:

Most expensive states July 31 price per gallon Least expensive states July 31 price per gallon
Hawaii $3.24 Mississippi $1.84
California $3.18 Louisiana $1.86
Washington $2.80 Texas $1.88
Nevada $2.66 Alabama $1.89
Oregon $2.66 Arkansas $1.89
Alaska $2.53 Oklahoma $1.90
Colorado $2.44 Missouri $1.91
Idaho $2.42 South Carolina $1.92
Pennsylvania $2.42 Tennessee $1.93
Illinois $2.38 Kansas $1.98

Regular gasoline prices in individual states are volatile. From July 1 to July 31, they increased in every state. Following are the 10 states in which prices rose by the greatest percentage from July 1 to July 31:

State July 31 price per gallon % change from July 1
Delaware $2.24 4.2
California $3.18 3.6
South Dakota $2.16 3.3
Wyoming $2.19 3.3
Montana $2.25 3.2
Maryland $2.27 3.2
Utah $2.37 3.0
Idaho $2.42 3.0
Maine $2.21 2.8
Washington $2.80 2.6

Following are the states with the biggest decreases in their price per gallon as of July 31:

State July 31 price per gallon % change from July 1
North Carolina $1.98 -3.9
West Virginia $2.15 -3.2
Wisconsin $2.06 -2.8
Ohio $2.11 -2.8
Kentucky $2.05 -2.4
Michigan $2.14 -2.3
Minnesota $2.06 -1.9
Indiana $2.11 -1.9
Iowa $2.07 -1.4
Arizona $2.34 -1.3

What are eGallons, and which states had the best prices?

The U.S. Department of Energy has developed a measure called an eGallon to compare the cost of fueling a vehicle with electricity compared with a similar vehicle that uses gasoline. The DOE calculates how much electricity the most popular electric vehicles would need to travel the same distance as similar model gasoline-powered cars. That amount of electricity is then multiplied by the average cost of electricity in the state.

So which state had the lowest eGallon price? Louisiana had the lowest eGallon rate of $0.84 as of July 25, the latest date prices were calculated by the EIA. The highest eGallon price was in Hawaii, at $2.98.

Following are the 10 highest and lowest eGallon prices as of July 25:

Highest priced states Price per eGallon (July 25) Lowest price states Price per eGallon (July 25)
Hawaii $2.98 Louisiana $0.84
Connecticut $2.14 Idaho $0.86
Rhode Island $2.13 Washington $0.88
Massachusetts $2.11 North Dakota $0.93
Alaska $2.02 Missouri $0.94
California $1.86 Oklahoma $0.94
Vermont $1.78 Utah $0.94
New Hampshire $1.76 Arkansas $0.97
New York $1.58 Tennessee $0.99
Maine $1.53 Oregon $1.00

Which states are best for electric vehicle drivers?

Other than the initial cost of the purchase, nearly every state is better for electric vehicles when comparing the cost of fueling/charging – on average, the cost is about 55 percent lower for EVs. But in some states, the difference is dramatic. The widest gap between the prices using the July 25 eGallon numbers is in Washington, where it is $1.92. In Rhode Island, gasoline costs 2 cents less than the July 25 eGallon prices.

Following is a list of the 10 states where drivers could save the most on fuel by switching to an electric vehicle:

State Gap between prices State Gap between prices
Washington $1.92 Colorado $1.34
Oregon $1.66 California $1.32
Nevada $1.59 Montana $1.23
Idaho $1.56 Wyoming $1.19
Utah $1.43 Arizona $1.18

By the numbers

Following are state-by-state numbers on the average price of gasoline per gallon of the month, the percentage above or below the U.S. average, the most recent eGallon price, and the spread between the two.

State July 31 price per gallon % above/below U.S. average Price per eGallon (July 25) Spread
Alabama $1.89 -13.3 $1.17 $0.72
Alaska $2.53 16.1 $2.02 $0.51
Arizona $2.34 7.3 $1.16 $1.18
Arkansas $1.89 -13.3 $0.97 $0.92
California $3.18 45.9 $1.86 $1.32
Colorado $2.44 11.9 $1.10 $1.34
Connecticut $2.20 0.9 $2.14 $0.06
Delaware $2.24 2.8 $1.18 $1.06
District of Columbia $2.30 5.5 $1.13 $1.17
Florida $2.15 -1.4 $1.07 $1.08
Georgia $2.00 -8.3 $1.04 $0.96
Hawaii $3.24 48.6 $2.98 $0.26
Idaho $2.42 11.0 $0.86 $1.56
Illinois $2.38 9.2 $1.25 $1.13
Indiana $2.11 -3.2 $1.15 $0.96
Iowa $2.07 -5.0 $1.16 $0.91
Kansas $1.98 -9.2 $1.18 $0.80
Kentucky $2.05 -6.0 $1.01 $1.04
Louisiana $1.86 -14.7 $0.84 $1.02
Maine $2.21 1.4 $1.53 $0.68
Maryland $2.27 4.1 $1.20 $1.07
Massachusetts $2.14 -1.8 $2.11 $0.03
Michigan $2.14 -1.8 $1.47 $0.67
Minnesota $2.06 -5.5 $1.20 $0.86
Mississippi $1.84 -15.6 $1.06 $0.78
Missouri $1.91 -12.4 $0.94 $0.97
Montana $2.25 3.2 $1.02 $1.23
Nebraska $2.12 -2.8 $1.01 $1.11
Nevada $2.66 22.0 $1.07 $1.59
New Hampshire $2.12 -2.8 $1.76 $0.36
New Jersey $2.19 0.5 $1.45 $0.74
New Mexico $2.04 -6.4 $1.15 $0.89
New York $2.27 4.1 $1.58 $0.69
North Carolina $1.98 -9.2 $1.09 $0.89
North Dakota $2.10 -3.7 $0.93 $1.17
Ohio $2.11 -3.2 $1.11 $1.00
Oklahoma $1.90 -12.8 $0.94 $0.96
Oregon $2.66 22.0 $1.00 $1.66
Pennsylvania $2.42 11.0 $1.25 $1.17
Rhode Island $2.15 -1.4 $2.13 $0.02
South Carolina $1.92 -11.9 $1.19 $0.73
South Dakota $2.16 -0.9 $1.05 $1.11
Tennessee $1.93 -11.5 $0.99 $0.94
Texas $1.88 -13.8 $1.12 $0.76
Utah $2.37 8.7 $0.94 $1.43
Vermont $2.17 -0.5 $1.78 $0.39
Virginia $1.99 -8.7 $1.16 $0.83
Washington $2.80 28.4 $0.88 $1.92
West Virginia $2.15 -1.4 $1.07 $1.08
Wisconsin $2.06 -5.5 $1.35 $0.71
Wyoming $2.19 0.5 $1.00 $1.19
US $2.18 0.0 $1.21 $0.97

Of course, having low eGallon prices does no good without a sufficient number of public charging stations. According to, California has the largest number of stations – 4,978. Which is great. But a more accurate measure may be number of people per charging station. Vermont is tops there, with a station for every 3,780 residents, while California has one for every 7,942 people.

Following are the total public charging stations for each state, the number of people per charging station, and the rank of each state by the number of people per charging station.

State No. of stations People per charging station Rank (people per charging station)
Alabama 132 36,930 47
Alaska 9 82,199 50
Arizona 474 14,802 26
Arkansas 100 30,043 45
California 4,978 7,942 5
Colorado 730 7,681 4
Connecticut 339 10,585 12
Delaware 47 20,467 37
Florida 1,173 17,890 33
Georgia 771 13,527 21
Hawaii 257 5,555 2
Idaho 64 26,827 42
Illinois 816 15,689 28
Indiana 423 15,761 29
Iowa 370 8,502 8
Kansas 214 13,613 22
Kentucky 161 27,666 43
Louisiana 114 41,091 48
Maine 139 9,611 10
Maryland 592 10,223 11
Massachusetts 576 11,909 15
Michigan 666 14,958 27
Minnesota 662 8,424 7
Mississippi 58 51,450 49
Missouri 496 12,326 16
Montana 36 29,180 44
Nebraska 168 11,429 14
Nevada 236 12,704 17
New Hampshire 97 13,843 23
New Jersey 274 32,867 46
New Mexico 85 24,566 41
New York 1,115 17,802 32
North Carolina 638 16,103 30
North Dakota 58 13,024 19
Ohio 566 20,598 38
Oklahoma 207 18,990 35
Oregon 597 6,939 3
Pennsylvania 550 23,283 40
Rhode Island 83 12,767 18
South Carolina 280 17,944 34
South Dakota 105 8,283 6
Tennessee 468 14,350 25
Texas 1,351 20,951 39
Utah 224 13,847 24
Vermont 165 3,780 1
Virginia 512 16,543 31
Washington 830 8,923 9
West Virginia 95 19,114 36
Wisconsin 440 13,172 20
Wyoming 54 10,728 13

By the way, we feel compelled to point out that the page referenced has a ton of good info about EVs. You should check it out, but only after you’re done here.

Image courtesy of Shutterstock

(Last updated July 4, 2020)