Energy Tomorrow Blog
Posted June 20, 2014
Let’s make a couple of points with the juxtaposition of the newest U.S. report on energy production on federal lands and a pair of new analyses people are talking about this week.
First, there’s this piece by the Manhattan Institute’s Jared Meyer on the Real Clear Energy website, asserting that surging U.S. crude oil production is playing a big role in keeping global crude prices stable despite turmoil around the world:
The most important contribution to oil's price stability has been the substantial increase in U.S. production. U.S. crude oil production has risen 50 percent since 2008, to 7,443 thousand barrels a day. This increase has been driven by advances in drilling technology. Hydraulic fracturing has opened up previously-known reserves that were either inaccessible or too cost-prohibitive for drilling.
Posted June 20, 2014
Houston Chronicle: Oil, natural gas and coal have boosted living conditions around the globe, but policies to replace those fossil fuels "with inferior energy sources" could undermine those improvements, a former Texas environmental regulator argues.
In a 36-page paper - "Fossil Fuels: The Moral Case" - Kathleen Hartnett White, former chairman of the Texas Commission on Environmental Quality, insists that access to oil, natural gas and coal are inextricably linked with prosperity and well-being.
Policies targeting heat-trapping greenhouse gases - including the Environmental Protection Agency's new plan for throttling carbon dioxide emissions from existing power plants - overlook "the inestimable human benefits of fossil fuels," White says.
"Energy-dense, abundant, versatile, reliable, portable, and affordable, fossil fuels provide over 80 percent of the world's energy because they are superior to the current alternatives," White writes.
Posted June 18, 2014
Here’s a link to a well-done video produced by Fortune magazine, showing a little bit about what it’s like to work on an oil and natural gas production platform more than 100 miles out in the Gulf of Mexico. The video’s producers visited Chevron’s Tahiti platform and interviewed a couple of the facility’s workers to gain insight into the two-weeks-on, two-weeks-off nature of life on the platform.
Posted June 16, 2014
FT.com – Despite jitters over Iraq, the price of oil is at its most stable since the early 1970s, as a huge increase in US oil production offsets massive disruptions to supply from places such as Libya, according to BP.
Christof Rühl, group chief economist, said the world had seen a cumulative 3m barrels a day of supply disruption since the start of the 2011 Arab uprising but that had been “cancelled out” by a similar extra amount of US production.
“There has been an almost perfect match between outages in north Africa and elsewhere and US production growth,” he said. The equilibrium had created an “eerie quiet” in global oil markets.
Posted June 11, 2014
Last summer we published this post on the construction of Anadarko Petroleum’s Lucius spar that would support the company’s newest Gulf of Mexico production platform. A few months later we added this one, featuring three video clips of the spar being towed to sea and positioned in the Gulf, about 275 miles southeast of Galveston, Texas.
Now check out the new video below, showing Lucius’ 10,000-ton topsides – the production decks, living quarters and other features – being installed recently on the truss spar as it floats in approximately 5,300 feet of water.
Posted June 4, 2014
If you run a business that sells things produced from raw materials – manufacturers, retailers, wholesale distributors and car and equipment dealers and other industries – chances are good you’re familiar with “LIFO” accounting. The IRS first approved the “last-in, first-out” method for use by taxpayers with inventories in the 1930s. Repealing LIFO, as some in Congress are proposing, could impact the more than 30 percent of U.S. companies, large and small, that use it, as well as the larger economy.
That’s the message a bipartisan group of 113 U.S. House members conveyed in a recent letter to Ways & Means Committee Chairman Dave Camp, who has proposed LIFO repeal as part of his larger tax reform package.
Posted June 3, 2014
More data from the U.S. Energy Information Administration (EIA), pointing toward American energy self-sufficiency: The agency reports domestic energy production accounted for 84 percent of total U.S. energy demand in 2013, a ratio last seen in the early 1990s. EIA:
The portion of U.S. energy consumption supplied by domestic production has been increasing since 2005, when it was at its historical low point (69%). Since 2005, production of domestic resources, particularly natural gas and crude oil, has been increasing as a result of the application of technologies that can develop harder-to-produce resources.
Posted May 29, 2014
Individual states would see significant job creation and economic growth from exporting U.S. crude oil, according to anew state-by-state report by ICF International and EnSys Energy. Specifically, 18 states could realize more than 5,000 new jobs each in 2020 from crude oil exports, with state economies growing by hundreds of millions of dollars each.
Kyle Isakower, API vice president for regulatory and economic policy, talked about the study during a conference call with reporters:
“There is a growing realization that this is a new era for American energy. Scarcity is giving way to abundance, and restrictions on exports only limit our potential as a global energy superpower. Additional exports could prompt higher production, generate savings for consumers, and bring more jobs to America. The economic benefits are well-established, and policymakers are right to reexamine 1970s-era trade restrictions that no longer make sense.”
Posted May 15, 2014
CNBC (Spencer Abraham/Bill Richardson): Once again the world is looking for America's leadership in unsettled times. Our diplomats have limited options to combat Russia's annexation of Crimea, but they can take greater advantage of a new tool in their toolbox that no administration has had for generations — U.S. energy abundance. American energy exports will not only create economic opportunities here at home but will provide strategic geopolitical advantages abroad.
The crisis involving Ukraine and Russia highlights the need for American energy leadership. Russia remains the world's largest exporter of natural gas, supplying 30 percent of Europe's imports. Countries on Russia's periphery, many nearly completely dependent on Russian supply, pay exorbitant oil linked prices. Many are NATO allies.
Posted May 14, 2014
A couple of charts from energy/economics blogger Mark J. Perry really show the fundamental rewriting of the United States’ energy narrative – as a result of surging domestic oil and natural gas production. Both charts, developed from data in the U.S. Energy Information Administration’s (EIA) annual energy outlook, indicate that the U.S. is rapidly moving toward energy self-sufficiency – the point at which domestic output lowers net imports to zero.