5 Reasons Oil Prices Are Dropping

Key contributing factors in the fall in oil prices range from surprise production levels in Libya to, in-fighting between OPEC members and EU economic outlook…

Source: oilprice.com

“> […]

1. The U.S. Oil Boom
America’s oil boom is well documented. Shale oil production has grown by roughly 4 million barrels per day (mbpd) since 2008. Imports from OPEC have been cut in half and for the first time in 30 years, the U.S. has stopped importing crude from Nigeria.

2. Libya is Back
Because of internal strife, analysts have until recently assumed that Libya’s output would hover around 150,000-250,000 thousand barrels per day. It turns out that Libya has sorted out their disruptions much quicker than anticipated, producing 810,000 barrels per day in September. […]

3. OPEC Infighting 
There have been numerous reports about the discord between OPEC members, leading many to believe that OPEC will not be able to reign in production like it has done so in the past. The Saudis and Kuwaitis have reportedly been in an oil price war, repeatedly lowering their prices in order to maintain their market share in Asia. […]

4. Negative European Economic Outlook
European Central Bank president Mario Draghi has left investors concerned about the continent’s slow growth. Germany’s exports were down 5.8 percent in August, stoking the fears of anxious investors that the EU’s largest economy had double dipped into recession last quarter. Across the Eurozone, the IMF again lowered its growth forecast to 0.8 percent in 2014 and 1.3 percent in 2015.

5. Tepid Asian Demand 
Beyond slow economic growth and currency depreciation, a number of Asian countries have begun cutting energy subsidies, resulting in higher fuel costs despite a drop in global oil prices. […]”<

 

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Price of Oil Continues to Drop Due to Oversupply

The price of oil has hit another five-year low as fears of oversupply continue to mount.  Brent crude was down $1.77 at $67.30 a barrel in Monday afternoon trading, having earlier hit $66.77 – its lowest since October 2009.

Source: www.bbc.com

>” […]US crude was down $1.44 at $64.40, after falling as low as $64.14.

Morgan Stanley predicted that Brent would average $70 a barrel in 2015, down $28 from a previous forecast, and be $88 a barrel in 2016.

The investment bank also said that oil prices could fall as low as $43 a barrel next year. Analyst Adam Longson said that markets risked becoming “unbalanced” unless the Opec producers’ cartel decided to intervene.

Saudi Arabia, the cartel’s biggest member, resisted calls at last month’s meeting to cut production despite the slide in prices, which have fallen more than 40% since June.

Kuwait, another Opec member, said that oil prices were likely to remain about $65 a barrel until the middle of next year unless Opec cut output. […]”<

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COGA brings state into lawsuit against Longmont ‘fracking’ ban

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The lawsuit against Longmont&#27;s ban on fracking has now roped in the Colorado Oil and Gas Conservation Commission, the state&#27;s regulatory agency.

Duane Tilden‘s insight:

>Boulder County District Court Judge D.D. Mallard said she would allow the Colorado Oil and Gas Association to bring in the COGCC as an additional plaintiff, a move called “joinder.” In her ruling, Mallard said that while both parties had an interest in seeing the ban overturned, the state agency had aims that would not be adequately represented by COGA, the state’s largest oil and gas industry group.

“COGA’s interest in this case is to overturn the charter amendment so that its members can proceed with oil and gas production using fracking […]

Longmont voters passed the ban on hydraulic fracturing, or “fracking,” last November with about 60 percent in favor. Supporters of the ban say the practice can lead to environmental damage; opponents say the practice is so well-established that a ban on fracking is practically a ban on drilling, and that only the state has the authority to regulate the methods used.<

See on www.timescall.com

Duke U Study Links Hydraulic Fracturing to Ground Water Contamination

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The debate about whether or not fracking can contaminate ground water supplies has been raging for a while now, and a new study by Duke University has found proof

Duane Tilden‘s insight:

>But let us allow Jacksona et. al. to speak for themselves, from the report: “We analyzed 141 drinking waterwells across the Appalachian Plateaus physiographic province of northeastern Pennsylvania, examining natural gas concentrations and isotopic signatures with proximity to shale gas wells. Methane was detected in 82% of drinking water samples, with average concentrations six times higher for homes” less than one kilometer from the fracked natural gas wells. […]

“They found that, on average, methane concentrations were six times higher and ethane concentrations were 23 times higher at homes within a kilometer of a shale gas well.  Propane was detected in 10 samples, all of them from homes within a kilometer of drilling. […]

The ethane and propane data are “particularly interesting,” he noted, “since there is no biological source of ethane and propane in the region […]<

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Fracking ban halts first shale gas project in Spain

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A ban on fracking in a northern region of Spain has crimped Repsol SA’s plans to begin drilling for shale gas in the north of Spain.

Duane Tilden‘s insight:

>Spain’s richest shale gas reserves have been determined to exist in the northern region of Cantabria, but back in April the local Cantabrian government  implemented the country’s first fracking ban, worried that such activities may pollute the local sources of drinking water. (Related article: Duke University Study Links Fracking to Ground Water Contamination) […]

Repsol had planned to begin seismic studies, with a view to drilling, in July, but the Cantabrian fracking ban, which prevents all hydraulic fracturing activities within the region’s borders, has put a hold on plans. In truth, it is not fully understood how the ban will affect Repsol, whose Luena project covers 290 square miles, and stretches from Cantabria down to Castille & Leon. Normally when a project extends across two regions or more it is regulated by the national Industry Ministry, not local governments. <

See on www.csmonitor.com