On US oil exports, offshore safety, crude-by-rail, how long will the government delay?

It has become a routine in Washington to explain the government’s inability to react to changes in the marketplace by blaming the swift pace of technological change. The latest such admission came last week when Commerce Secretary Penny Pritzker spoke about US crude exports.

“Technology is advancing faster than existing regulations,” Pritzker said during an appearance at the Aspen Ideas Festival. She said there was a “serious conversation” going on within the administration on crude export policy. “The question is what [are] the right exports and what is the right amount of exports.”

Similar admissions have come from other officials on the topic of transporting crude by rail and ensuring the safety of offshore drilling. In all three cases, industry has wisely not waited for Washington to act. Innovation marches on and companies put huge amounts of capital at risk to advance new ways to produce and move energy resources.

Read the rest of this entry »

Major US trade decision in the pipeline for OCTG producers

The story is a familiar one: Cheap foreign steel products are threatening domestic manufacturers, and the US steel industry is seeking relief with a trade case.

Here’s how it goes down: Following a petition by one or more US producers, the Department of Commerce and the International Trade Commission independently and simultaneously investigate any antidumping and countervailing claims. Commerce investigates whether imported products are sold at less-than-fair value or have been subsidized by foreign governments and determines duty rates accordingly. The ITC rules whether those imports materially injure or threaten material injury to the domestic industry. If either body votes in the negative, no duties are levied.

On Friday, Commerce is due to make its final determination in the antidumping and countervailing investigations of oil country tubular goods (OCTG) imports from South Korea, India, the Philippines, Saudi Arabia, Taiwan, Thailand, Turkey, Ukraine and Vietnam.

Read the rest of this entry »

The changing face of global gas, or, chasing the arbitrage

The fate of US LNG import terminal projects was sealed as the amount of relatively low-cost gas produced onshore soared in the middle of the last decade. Most of them were scrapped before getting off the drawing board, but the more advanced of them, notably Cheniere’s Sabine Pass, went on to become export terminals, in a radical and apparently successful bid to salvage their backers’ fortunes.

That well-documented transformation was only made possible by the yawning price difference opening up between the depressed Henry Hub and the rest of the world.

Read the rest of this entry »

EIA analysis: US crude stocks fall on higher refinery run rates

US crude oil stocks fell 2.4 million barrels the week ended July 4 on an uptick in refinery run rates, according to data from the Energy Information Administration. Total US refinery throughput rose above the five-year average, which added to refinery utilization rates. Read the Platts analysis  from Alison Ciaccio here.

The Oil Big Five: Your comments include Iraq, Africa, refining, and OPEC

You’ve read about the big topics our Platts experts think are most interesting for July, and now we want to turn our attention to our readers.

In our monthly The Oil Big Five feature, we poll our global oil experts for what they consider the most pressing or interesting aspects of the oil industry at the moment. We follow each post by rounding up some of the comments, and below you can see (in no particular order) some of the reactions we had from our readers, both on the blog as well as on social media.

Read the rest of this entry »

Regulation & Environment: Cap & Trade comes to California oil product markets

California’s cap and trade law has been reality for a wide variety of CO2 emitters for several years. But they are all stationary sources. In January, it moves to a moving kind of source: motor vehicles. In this week’s Oilgram News column, Regulation & Environment, John Kingston, fresh off a trip to the state’s capital city of Sacramento, discusses the implementation of the law in the fuels business.

Read the rest of this entry »

“Mini-trends” increasingly common in the oil industry

In the talk about oil cycle phases, one pattern that has emerged in recent years is the appearance of “mini-trends” within the industry that are often at odds with what is happening in the larger market.

As a result, data is growing increasingly complex, and even single data sets contain a “story-behind-the-story” which often makes more complete interpretations necessary and keeps journalists and researchers busy “Deciphering It All.”

Case in point — one of many — is the offshore industry which is undergoing a slump in dayrates, particularly for deep- and ultra-deep waters, while the onshore sector — which at least in the US and increasingly overseas now consists of unconventional drilling — churns ever-higher amid what is generally agreed to be a larger, unprecedented boom.

Read the rest of this entry »

The Latin American quandary: lots of shale gas, not a lot of production

Imports of liquefied natural gas to Latin American are up 18% so far this year, according to Bentek, a unit of Platts, buoyed by growing demand from Mexico and Brazil. But, with so much recoverable indigenous supply, why is Latin America paying top dollar for imported gas?

According to the US Energy Information Administration, technically recoverable shale gas resources in Argentina are the second largest globally at 802 trillion cubic feet, Mexico’s reserves are the sixth largest at 545 Tcf, while Brazil ranks tenth with reserves estimated at 245 Tcf.

Accessing these shale reserves requires political will and costly investments, factors that have combined in various ways across the region to impede domestic production and make LNG an easy, though short-sighted solution to growing demand for electricity in Latin America.

Read the rest of this entry »

S&P Dow Jones launches a new commodity index

Our colleagues at S&P Dow Jones Indices — like Platts, a unit of McGraw Hill Financial — have launched a new commodity index. Investing in commodities through indexes do or do not have a significant impact on price; we cite both sides of the coin to note that it is an issue of significant disagreeement among analysis.

Platts wrote about the launch in this news story on July 1, the day the index was launched. We are republishing here a blog posting from S&P’s blog Indexology, written by Jodie Gunzberg, global head of commodities for S&P Dow Jones Indices. We have featured Jodie’s views on The Barrel previously.

Read the rest of this entry »

Foreign-owned steelmakers in the US go native and sue “foreigners”

A funny thing happened on the way to international free trade.

If you know what a NIMBY is, that should provide a clue. When foreign steel mills started buying American producers some thought they might eventually see an end to costly and disruptive unfair trade case filings as a more international perspective flourished in the market. (If you don’t know, NIMBY stands for “Not in my back yard.”)

But the filing of American steel dumping and countervailing duty cases never ended. There has been a resurgence in recent years, and more are expected to be filed or finalized this year and next. Steel has been the most litigated product in human history and likely still holds that honor.

Read the rest of this entry »