GLOBAL OIL RECAP AND BALANCES | August 16, 2019

August 2019

Highlights from the IEA’s August 2019 Oil Market Report ( OMR ) The IEA warned in its latest OMR that oil demand outlook is “fragile” and the risks are skewed to the downside. Global oil consumption growth was cut by -0.1 mb/d for 2019 to 1.1 mb/d and by -0.05 mb/d for 2020 to 1.3 mb/d following lowered global GDP projections posted by the IMF in July and downside risks led by the escalated US-China trade dispute. The slowdown in oil consumption growth is reflected in the Jan-May an.....


GLOBAL OIL RECAP AND BALANCES | July 12, 2019

July 2019

The table below shows implied stock change for 2H2019 and 2020: Highlights from the IEA’s July 2019 Oil Market Report ( OMR ) While maintaining its GDP growth projection and oil demand largely unchanged from the June publication, the IEA continues to see downside risks to global oil consumption owing to recently weakened trade activity and manufacturing output. Oil demand in 2Q19 was revised down by -0.4 mb/d to 99.6 mb/d, driven by lower-than-expected oil consumption in Italy, Ind.....


GLOBAL OIL RECAP AND BALANCES | June 14, 2019

June 2019

The table below shows implied stock change for 2019 Q2-Q4 and 2020: Highlights from the IEA’s June 2019 Oil Market Report ( OMR ) The IEA pointed out that while supply risks remain in the market, the “main focus” has shifted to the demand side due to weakened economic growth. Remarkably, the IEA based its demand projections on OECD’s outlook for global GDP growth, which shows a lower-than- IEA -expected growth rate of 3.2% with world trade growth falling to the level seen ten yea.....


EARNINGS CALLS | May 31, 2019

May 31, 2019

With 2019 marking the year of ‘free cash flow’ optimization for producers, this quarter was the first glimpse into how producers were adjusting to stricter CAPEX budgets and changing shareholder expectations around production. The Anadarko Petroleum takeover loomed large over this quarters’ calls with analysts poking around to determine “who’s next?” On a play-by-play basis, negative gas pricing in the Permian made associated gas a focus this quarter and recent announcements from Midcontinent .....


GLOBAL OIL RECAP AND BALANCES | May 15, 2019

May 2019

The table below shows implied stock change for 2019 Q2-Q4 and 2020: Highlights from the IEA’s May 2019 Oil Market Report ( OMR ) Today’s OMR notes how “geopolitics and industry disruptions” confuse “the supply outlook.” The one-pager hits many points on the supply side, including Libya, Iran, Venezuela, “attacks on shipping off Fujairah and on two pumping stations in Saudi Arabia” as well as the contamination in the 1.4 mb/d Druzhba system. The real page-turner for us, however, was.....


GLOBAL OIL RECAP AND BALANCES | April 11, 2019

April 2019

The table below shows implied stock change for 2019 2Q-4Q and 2020: Highlights from the IEA’s April 2019 Oil Market Report ( OMR ) Under current OPEC + supply cuts and with US sanctions against Iran & Venezuela, the IEA sees tightness in the oil market but warns “mixed signals in terms of the outlook for demand and whether stock levels are yet ‘normal’”. In April OMR , the agency kept overall global supply and demand unchanged. On the supply side, OPEC crude output in March fe.....


EARNINGS CALLS | April 02, 2019

Oil and Gas Producers (4Q 2018)

“Organic” and “local” do not belong to the list of words commonly used in E&P earnings calls. Yet, both terms came up this quarter to describe changing attitudes towards supply and demand, respectively. Producers “living within their means” are lowering leveraged CAPEX , focusing on free cash flow, share buybacks, reducing costs and finding capital efficiencies in order to grow organically . And in certain cases – such as the Marcellus – they are also focusing on local demand growth to find .....


GLOBAL OIL RECAP AND BALANCES | March 15, 2019

March 2019

The table below shows implied stock change for 2019 and 2020: Highlights from the IEA’s March 2019 Oil Market Report ( OMR ) With the IMF lowering its 2019 global GDP projection to 3.5% (down by -0.2%), the IEA acknowledges that the “economic sentiment is becoming more pessimistic and the global economy could be entering a vulnerable period.” The Agency approaches the economic vulnerability discussion from a supply shock perspective, praising the available spare capacity which wa.....


GLOBAL OIL RECAP AND BALANCES | February 13, 2019

February 2019

The table below shows implied stock change for 2019 and 2020: Highlights from the IEA’s February 2019 Oil Market Report ( OMR ) We got an abbreviated version of the OMR this month. The IEA shows 2018 demand growth at 1.3 mb/d, with China (0.44 mb/d), India (0.21 mb/d) and the US (0.54 mb/d) contributing 1.19 mb/d of the total. Demand in 2019 is unchanged from last month at 1.4 mb/d. Yet even when we plug in lower OPEC supply of 30.83 mb/d into the table above, IEA’s 2019 stock ch.....


GLOBAL OIL RECAP AND BALANCES | January 22, 2019

January 2019

The table below shows implied stock change for 2019 and 2020: Highlights from the IEA’s January 2019 Oil Market Report ( OMR ) The IEA believes that the latest OPEC + supply reduction agreement has put a floor under prices, “at least for now”. Prior to the cuts, OPEC 1 has reduced crude output by 0.59 mb/d MoM in December, led by Saudis with a -0.42 mb/d drop and “unplanned outages in Iran and Libya.” January will see Saudi production at an even lower 10.2 mb/d, 0.11 mb/d below it.....