The Midnight Oil

This weeks oil & gas news!

For the seventh consecutive week, U.S. operators reduced rig count according to Baker Hughes. The rig count dropped by 8 to 687, the lowest since April 2022. The number of US oil rigs fell to 552, the lowest since April 2022, while gas rigs decreased to 130, the lowest since March 2022. The Permian and Marcellus shale regions, the largest oil and gas basins in the country, each lost four rigs. The decline in gas prices has led some exploration and production companies cutting rigs, particularly in the Haynesville shale.

Despite rig reductions, Oil prices rose for the week (WTI $71.78) due to strong global demand signals, including China's growing usage and expectations of a robust US driving season. However, stockpiles continue to increase despite OPEC+ production cuts, limiting the rally. The heavy, sour crude market has tightened due to production cuts and other factors, but light, sweet grades from US shale producers have partially balanced the market. Refinery outages in the US and Europe could further increase crude inventories, disrupting the rebound in prices. (Full article here: Oil Posts Weekly Gain | Rigzone)

In other good news, Shell CEO Wael Sawan shares the company will continue to produce through 2030, a shift from the companies previous position. "Performance, discipline, and simplification will be our guiding principles as we allocate capital to enhance shareholder distributions, while enabling the energy transition… We will invest in the models that work – those with the highest returns that play to our strengths," Sawan said.

Technology will be key

This past week, I spent 4 days in Denver at the Unconventional Resources Technology Conference (URTeC) where operators from around the U.S. and beyond, got together to share technical papers from the industry. The conference spanned 3 days, and was packed full of technical presentations and papers. (bonus points for being during the NBA finals where the Nuggets won!)

The conference was abuzz with people looking to see what technology can be deployed to optimize their production, and maximize recoverable oil. Because of the variability in the subsurface is so unique, (just think how diverse the land is from Houston to San Antonio) there is no one size fits all approach. Conferences like this allow operators to share success and improve the industry overall. Not to mention, the networking and conversations that are had throughout the week. Tons of mention of AI (ChatGPT hello!), the latest technology, optimization, and more. Be sure to attend next years URTeC in Houston if you missed this years!

Trivia of the day

Which U.S. Major oil and gas producer produced the most per day in Q1 2023?

(answer below)

What we are listening to this week…

What good will oil and gas be for us if we are not around to use it! Dr. Peter Attia M.D. is on a quest to help us live our longest and healthiest lives. Attia shows there is a distinct difference between health-span and lifespan, and why this is important. He wants you to live as long as possible, while still being able to live a happy life doing the things you live.

Attia brings a ton of knowledge to his podcast. He is very well researched with each guest provides a wealth of knowledge. Be sure to listen anywhere podcasts are available!

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Answer: ExxonMobil with 3.831 million barrels of oil equivalent per day