West Texas Intermediate crude for July delivery fell 5.7% on Thursday to settle at $57.91 per barrel, the biggest percentage drop since Dec. 24, while Brent tumbled 4.6% to end the session at $67.76 per barrel. Prices took a hit from mounting demand concerns in light of the US-China trade dispute and rising global crude inventories.
Pipeline operator Rattler Midstream Partners, a subsidiary of Diamondback Energy, launched an initial public offering that brought in $665 million, making it the biggest energy IPO of 2019. Rattler operates 781 miles of crude, natural gas, drilling and wastewater pipeline in the Midland and Delaware basins of the Permian Basin.
Members of OPEC are looking at ways to navigate market concerns about oil supplies that have been magnified by geopolitical tensions. One option would see OPEC maintaining existing production targets while relaxing how those targets are carried out.
Royal Dutch Shell has kicked off production ahead of schedule at the Appomattox platform in the deepwater Gulf of Mexico, which is expected to have average peak production of 175,000 barrels of oil equivalent per day. "That Appomattox was safely brought online ahead of schedule and far under budget is a testament to our ongoing commitment to drive down costs through efficiency improvements during execution," said Shell Upstream Director Andy Brown.
Companies are rushing to build disposal wells in the Permian Basin to handle wastewater from oil and natural gas drilling. In the past week, the Railroad Commission of Texas has received permit applications from two companies -- Boykin Energy and CrownQuest Operating -- that are seeking to drill a total of 12 injection wells on leases in Loving County, Texas.
Fierce opposition from coastal states, coupled with a March court ruling declaring that an Obama-era ban on drilling in swathes of the Arctic and Atlantic oceans can only be reversed by Congress, may delay the release of a new offshore drilling plan until after the 2020 presidential election. "They're re-looking at the whole program with a fresh set of eyes now that there's a new secretary in place," said American Petroleum Institute Vice President of Upstream and Industry Operations Erik Milito.
The US is considering applying 25% tariffs to another $300 million worth of Chinese products and will make a decision after the next 30 to 45 days, says Treasury Secretary Steven Mnuchin. The Trump administration is open to new negotiations with China, he adds.
The average breakeven price for producing oil in the US has declined by 4% over the past year to $50 per barrel, helped by booming shale oil production and increased efficiency, particularly in the Permian Basin, according to the Federal Reserve Bank of Dallas. "Horizontal drilling and hydraulic fracturing have made accessible significant amounts of oil reserves previously considered uneconomical to develop," the Dallas Fed said in a report.
This two (2) day workshop will provide an overview of the requirements, timeline and the potential costs associated with obtaining an API Q1 certification and API 6D monogram license. This workshop is suitable for management and others responsible for guiding their company through the API Q1 certification and API 6D monogram license process. Presented by: Aston Technical Consulting Services, LLC, June 17-18, August 19-20. To learn more about this course and to register, visit the API-U Calendar.
International Safety Culture Summit, June 5-6, Chicago
Please join the American Petroleum Institute at the International Safety Culture Summit. The Summit brings together industry operators, contractors, service/supply companies, academia and regulators to facilitate collaboration and drive continual improvement. For more information visit the API Events Page.