Plunging global oil prices may turn hopes for cheap liquefied natural gas supplies from the United States into a costly disappointment for Asian buyers who have already invested billions of dollars in long-term contracts. The 26 percent price slide since June to $85 a barrel exposes cracks in the assumption by utilities and industrial companies from Japan to India that cheap U.S. LNG would muscle into high-value Asian energy markets from 2016. Oil prices form the backbone of LNG trade to Asia, because exporters outside the United States typically tie 25-year supply deals to crude oil prices. If prices continue to fall, these suppliers from Qatar to Australia will regain their edge over upstart U.S. producers. "From the buyer's view, $80 oil makes oil-linked supplies less expensive ... it makes U.S. LNG relatively less attractive for buyers," said one industry source with a commercial focus on North American projects. When Asian buyers signed for U.S. supply deals, the discount to rival oil-linked LNG supply was around $1.90 per mmBtu, but now that could be as low as 90 cents, and an oil price of $80 a barrel effectively results in a dead heat. Asian buyers such as Korea Gas Corp., Tokyo Electric and India's Gail now face the potential for a glut of increasingly cheap oil-linked LNG. Projects Suffer
As crude oil prices reach Gulf War highs and recent memories of historic low crude prices fade, capital spending on finding and developing new oil reserves continue to play catch up. "The recent oil-price crisis set back non-OPEC output growth for at least a year," a recent report released by Deutsche Banc Alex. Brown states, adding, "While currently high oil prices should spur investment, the extensive 16-month price slide should delay any significant output response from non-OPEC producers
The near record oil prices have left U.S. oil majors as the envy of industry during the third quarter reporting period, according to many industry analysts. "This is clearly a sector that investors shouldn't worry about having disappointing earnings surprises," said one. "The question is not whether they will beat consensus estimates, but by how much they'll beat estimates," said another. Such expectations from analysts and investors come as crude oil prices in the third-quarter hit
Yesterday (April 27), the Center for Strategic and International Studies (CSIS) and the U.S.-Saudi Arabian Business Council co-hosted a conference on “U.S.-Saudi Relations and Global Energy Security.” At this conference, as he has stated recently in other venues, the Saudi Arabian Minister of Petroleum and Mineral Resources, Ali al-Naimi, stated that, “There is no general shortage of crude oil in today's market -- supplies are readily available
Venezuela's petroleum export basket dropped to $42.44 per barrel this week from $47.05 last week to reach a 5-1/2-year low, the Petroleum Ministry said on Friday. The South American OPEC member's basket, which includes crude oil and refined products, trades at a discount to other benchmarks because of its higher content of heavy oil. Venezuelan oil prices averaged $88.42 last year, down from $98.08 in 2013.
The China's four state-run shipping-related companies are reportedly in the initial phases of combining units in order to beef up the national shipbuilding industry, says local media. The chances of mergers between China Ocean Shipping, China Shipping Container Lines, Sino Trans & CSC Holdings and China Merchants Group has improved as they now suffer in a lackluster business climate, the Chinese-language Securities Daily reports.
Profit-taking hit oilfield service and drilling stocks on Monday as U.S. crude oil prices shed over a dollar to dip below $30 a barrel for the first time since February 28. On Monday afternoon, the Philadelphia Stock Exchange's oilfield service index was off 4.82 points or 4.6 percent at 100.03, while U.S. April crude oil futures were $1.23 lower at $29.68 a barrel. Halliburton Co., the world's biggest oilfield service provider, was off more than five percent at 36-3/8 while Schlumberger Ltd
According to reports, oil prices fell by three per cent Monday, slipping below $59 a barrel as traders looked ahead to U.S. supply data due out Wednesday that is expected to show rising inventories of crude. Doubts about OPEC's ability to implement a 1.2 million barrels a day production cut also weighed on prices. Last week, oil prices surged after the U.S. Energy Department data showed a large decline in crude-oil inventories
Douglas-Westwood (DW) forecast subsea hardware spending is set to double to $124 billion during 2013-2017 compared to the preceding five-year period. The new third edition of Douglas-Westwood’s Subsea Hardware Market Forecast has launched analyses the market through to 2017, examining the key activity trends to provide detailed insight for major players and new entrants alike. “The prospects for the subsea hardware sector look good, however
Falling ship operating costs and low bunker prices will translate into higher profitability fueling economic growth, says Dubai-headquartered DP World. As bunker fuel prices drop, so too could shipping costs. Dubai-headquartered DP World says falling oil prices are good news for global shipping. It plans to double investments this year, local media reports. The Chairman of DP World Sultan Ahmed bin Sulayem has stated that the fall in oil price may stimulate
Royal Dutch Shell has given the green light for the development of its largest platform in the Gulf of Mexico after making steep cost cuts which made the deep water project economical despite low oil prices. The decision to pour billions of dollars into the Appomattox project comes as
Immediately after signing contract with signed with Hyundai Samho Heavy Industries to build five VLCCs, with an option to build additional five VLCCs, the National Shipping Company of Saudi Arabia (Bahri) signed a contract with Hyundai Samho Heavy Industries to build additional five VLCCs
Viking Offshore & Marine has secured a 48-month charter for a second land drilling rig system for US$31 million ($41.8 million). Viking’s subsidiary Viking LR2 will charter the 1,500-bhp train-type land rig and related drilling equipment system to a Chinese land rig
According to a research note released today from UOB Kay Hian, Singapore offshore vessel operator Pacific Radiance achieved an ominous vessel utilization of 0% for its diving support vessel fleet in the second quarter of 2015.
Douglas-Westwood (DW) forecast in its new World Offshore Accommodation Market Forecast that over the period 2015 to 2020 demand for offshore accommodation vessels will average almost 42,000 Personnel on Board (PoB) per year. An increase of 14% compared to the preceding six-year period.
A sustained supply glut has maintained Brent oil prices through the first five months of 2015 at some 47 percent lower than the same period in 2014. Industry observers expect low oil prices to eventually take supply out of the market and drive a price correction, noted Douglas-Westwood.
Cost-cutting in Britain's North Sea oil and gas sector could lead to more acute skills shortages in future, industry experts have warned, with some expressing concerns that safety could be compromised. A plunge in crude prices over the last 12 months has prompted oil majors such as Royal
The International Energy Agency (IEA) says prospects for British Columbia’s nascent LNG sector export projects have ‘darkened’ and deferrals are likely. British Columbia faces intense competition from the rest of the world in developing its liquefied natural gas
National Oilwell Varco Inc., the largest U.S. oilfield equipment maker, said it will cut its Norwegian workforce by 1,500 by the end of this year as low oil prices have reduced investments. It plans to cut 900 permanent jobs and 600 contractors, the firm said in a statement on Wednesday.
Igor Sechin, the head of Russia's top oil producer Rosneft, said on Wednesday the United States is calling the shots on global oil markets, while the influence of OPEC has shrunk. The United States emerged with renewed vigour as a top producer thanks to its shale boom
The Houston-based NASDAQ-listed drilling contractor Hercules Offshore Inc. (HERO) has entered a restructuring agreement with a noteholder group, and expects a prepackaged reorganization plan. HERO says the agreement will convert $1
A recovery in LatAm debt spreads opened a window for Colombia's Ecopetrol on Tuesday when it printed a US$1.5bn 11-year bond - the state-owned oil company's first debt issue in nine months. Optimism over Greek debt talks spurred risk buying on Tuesday
Transocean Ltd, the world’s largest offshore driller, has delayed delivery of two new ultra-deepwater drillships, the company announced. The company amended its drillship construction contracts ($540 million each) with Jurong Shipyard, a subsidiary of Sembcorp Marine
As industry embraces gas, emissions regulations loom large and bunker logistics options develop, LNG’s fortunes nevertheless get a boost. For every gleeful consumer at the pump, and stockpiling tanker anchored offshore, there’s a corresponding trail of businesses that are
Imperial Oil Ltd said on Friday it and partners Exxon Mobil Corp and BP Plc need more time before they can drill an exploratory well in Canadian Arctic waters and are seeking an extension to their exploration license in the region.