This time it’s Different (!) At a macro level, the reality of higher gasoline prices is not quite as severe as prior cycles. While much higher crude oil prices have brought misery to drivers (including truckers), much lower natural gas prices are bringing pleasure to many of the same consumers. From 2004-7, higher oil …
Secular Low Nat Gas Prices – The Golden Age of Chemicals Returns to North America It’s been fascinating to watch the consequences of the dramatic dislocation of US natural gas prices with both oil and Rest of World gas prices has made the US one of the lowest cost chemical producer in the world, second …
Global (but Regional) Natural Gas and the Gas-Coal Paradox From recent conversations with leading onshore oil/gas producers, it seems that there is almost no US shale (with favorable seismic data) that cannot be frack-ed to produce hydrocarbons. It’s just a matter of time until, in the face of a mature services, pipeline, and processing …
Global Natural Gas – Interesting Trends have investment implications A by-product of very weak US natural gas prices, cheap chemical feedstocks, is taking hold as the US is probably the second lowest cost producer of commodity chemicals in the world, next to the Middle East. Meanwhile, Saudi Arabia’s decade long quest for natural gas …
It’s hard to focus on the fundamental energy environment, whether conventional or renewable, without continued consideration of the Macondo explosion and massive oil spill. I’m going to try, since so much else is ongoing, but, first…. Macondo Comment du Jour Just as noted in the last Issue, the estimated flow rate from the wellbore continues …
Geopolitics Comes to the US Gulf of Mexico If oil geopolitics are defined as the regional effects of politics on global oil/energy fundamentals (or security), perhaps the most important geopolitical events of the past six months have not been in the Middle East, or Korea, but the US Gulf of Mexico, where the most energy …
Oil Spill Continues to Dominate the Energy Scene – Commentary I commented in the last issue on some broader implications of the deadly TransOcean Horizon and Massey Mine explosions, including contrast with the first approved offshore wind farm. As a ‘confirming list’ of disturbing shortcuts, poor maintenance, fingerprinting, headlines the escalating environmental tragedy, the …
President Obama & Offshore Drilling – A “Nixon to China Moment?” Last week, President Obama announced, with some fanfare, a plan to open certain offshore regions (Continental Shelf from Virginia to Florida, a small area in the Eastern GOM, about 100 miles from Florida) to oil/gas exploration, while “ordering further study on others (primarily …
Shale Gas – The Revolution is Underway! Lastly, natural gas continues to benefit from headline opportunity. This week’s Economist highlights the global potential for shale gas, which may be in greater abundance and at lower costs than conventional gas or crude oil. Coincidentally, a Barclay’s note predicts that the Marcellus Shale (Pennsylvania/West Virginia/New York) …
Coal Fired Power – Exit Stage Right??? State of Colorado reached a tentative deal with its largest utility, agreeing to let EXEL convert or replace up to 900 MW of coal fired capacity with natural gas. Factoid – if the bottom 15% of all coal fired plants shut down, they would reduce coal-fired carbon dioxide …