Crude Oil ( ) Brent Crude ( ) Natural Gas ( ) S&P 500 ( ) PHLX Oil ( )
January 21, 2016

CRUDE OIL INVENTORY/’000 bbls (Week Ended 1/15/16)

Current: 486,537
Actual Build/(Withdrawal): 3,979
Economist Average Estimate: 2,678
Previous: 482,558

Click here for the chart with five year averages.

Stephens Investment Banking - Building Blocks of a Stronger Oil & Gas Industry


*$20 Oil Not New to Some Producers – Oil & Gas 360®

Oil and gas prices for the U.S. crude benchmark WTI, and international crude benchmark Brent, closed below $30 per barrel today, but some producers are already seeing less for their oil. The price for some grades of crude oil is already below $20 per barrel in parts of the world. Even the world’s largest producer, Saud Arabia, is selling its Arab Heavy grade crude oil to Asian markets for less than $20 per barrel. – Read More

*Pick 6: Looking Forward At The Oil and Gas Industry – Forbes

The one given in this industry is that the analyst community is consistently wrong about where the price of oil is going in the near to mid-term. Just as $100 oil was a sentiment driven price that baked in the risk of every potential negative impact on the supply chain, $28, $30 or $40 dollars is equally sentimental, assuming that any and all incremental barrels are and will be available AND demand will slow or stop. –Read More

*Oil cost falls below $28 a barrel, or less than the price of an actual barrel – The Independent

Not everyone agreed with the RAC when it said that petrol could become cheaper than bottled water. RAC wagered that if the price of oil slid below $20 barrel, it could push petrol prices to 90p a litre – while a fall to $10 a barrel or less could see petrol sold at 86p a litre, or cheaper than a bottle of water. But only if you are a water snob, according to the Hydration Council, who emailed us to say that the average price of a litre bottle of water, purchased in a multi-pack, is 38p. Take that, Perrier drinkers. – Read More

*Harold Hamm Standing Tall in Ongoing Oil Price Rout – Oil & Gas 360®

Harold Hamm is the Chairman and Chief Executive Officer of Continental Resources (ticker: CLR), one of the largest exploration and production companies in North America. He has also become the nominal leader of United States shale in the faceoff with Saudi Arabia, campaigning against the kingdom’s tactics and repeatedly stressing that an oil price recovery is on the horizon. The CLR magnate backed up his beliefs with his pocketbook – CLR divested its hedges after the Saudi Arabia “market share” announcement and remains unhedged to this day. – Read More

*Iran undercuts Saudi oil prices in the battle for Europe – RT

Tehran will provide a $6.55 discount on heavy crude for its European consumers, Reuters cites the National Iranian Oil Company. Saudi Arabia currently sells oil to Europe at a discount of $4.85 a barrel. The announcement came a day after Saudi state-owned Aramco said it would expand discounts for its light crude by $0.60 a barrel to northwest Europe and by $0.20 a barrel in the Mediterranean for February delivery. The rebate on Iran’s light crude matches Saudi’s February official selling price for oil to northwest Europe. – Read More

*Oil below $30 fans wipeout fears among U.S. shale survival artists – Reuters

Across oil fields from Texas to North Dakota fears are growing that crude’s plunge below $30 a barrel is more than just another market milestone and marks a countdown to an endgame for many shale producers that so far have braved the 18-month downturn. Oil prices tumbled by more than a fifth this month to 12-year lows 70 percent below mid-2014 levels and traders brace for more declines as world production keeps outpacing demand. Yet many of around 50 listed U.S. independent oil producers and scores of smaller ones need $40-$60 a barrel to break even, according to several analysts. – Read More

*Oil Could Go Lower: IEA – Oil & Gas 360®

In its first Oil Market Report of the year, the International Energy Agency painted a pessimistic picture for the outlook of oil prices. Even as the IEA expects 600 MBOPD of non-OPEC production to fall off during the year, “this will inevitably be largely offset by higher production from Iran,” it said in its release. Oil demand growth flipped from a near five-year high of 2.1 MMBOPD in Q3’15 to a one-year low of just 1.0 MMBOPD in the final quarter of the year. – Read More

*After the Carnage, Shale Will Rise Again – The Wall Street Journal

How low can oil prices go? When pundits start competing to predict where the barrel will hit bottom, you know that a rebound is inevitable. It’s the inverse of what happens before a high-price bubble bursts. Only a few years ago forecasters were suggesting that oil might hit $300 a barrel. The unpleasant reality is that petroleum prices are cyclical. Starting with the 1973-74 Arab oil embargo, they have been through six extremes. – Read More

*Canada Keeps Rate at 0.5%, Sees Recovery From Oil ‘Setback’ – Bloomberg

Bank of Canada policy makers kept their benchmark interest rate unchanged and said stronger U.S. demand, a weaker currency and two rate cuts last year are leading the economy out of an oil slump. The benchmark rate on overnight loans between commercial banks remained at 0.5 percent, in a decision released Wednesday from Ottawa. Global growth will pick up in 2016, Canada’s job market remains resilient and stalling fourth-quarter growth was due to temporary factors, policy makers said. – Read More

*Oil Prices, Rig Counts, and Loonie Continue Plunge – Oil & Gas 360®

The price of a barrel of West Texas Intermediate crude oil fell below the $30 mark for the first time since 2003 this week. Continued concerns over China’s market are curbing demand expectations as the global oil glut persists. WTI was trading at $29.45 at 2:15 EST today. More crude may soon be added to the glut as well, with Iran hoping to increase oil exports in the near future after sanctions surrounding its nuclear problem have been lifted. With both the supply and demand side of the oil price equation looking more bearish, the U.S. rig count continues to drop. – Read More

*Lack of export infrastructure has soured China on oil investment in Canada: CNOOC official – Financial Times

Canada has lost credibility as an investment destination because of its inability to build export infrastructure, a recently retired senior executive at China’s CNOOC Ltd., one of the country’s top three oil and gas companies, said Tuesday. After spending $35 billion in Canada’s energy industry when oil and asset prices were high, Chinese energy companies are reeling from the oil crash and cutting jobs and investment. China Investment Corp., the country’s sovereign wealth fund, shut down its Toronto office last month. – Read More

*Oman Offers to Cut Its Production 5%-10% – Oil & Gas 360®

Oman became the first non-OPEC oil producer to say that it will cut its production if done in coordination with other producers. Oman’s oil minister, Mohammad bin Hamad al-Rumhy, said the Persian Gulf nation would be willing to cut 5%-10% at an energy event in Abu Dhabi. “Oman is ready to do anything that would stabilize the oil market,” said al-Rumhy. “5% or 10% is what I think we need to cut and everyone has to do the same.” – Read More

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