BP’s 65th Statistical Review – Fossil Fuels Going Strong
Last week BP released its annual Statistical Review of World Energy–the 65th edition! (We have a full copy embedded below.) A number of big energy companies, like Exxon Mobil, as well as government agencies, publish similar reports that characterize current and future world energy trends. However, one analyst we read says BP’s report is the best: “I have relied upon the BP World Energy report for years. It is not a report to be viewed with a partisan eye, but as merely one of the best, if not the best, energy trend device available anywhere. In comparison to government agencies like the U.S. Energy Information Administration (EIA) the global International Energy Association (IEA) or OPEC’s own World Oil Outlook, the BP report has proven itself to be far more valuable in finding investable trends. I would never recommend any oil sector without having the statistical evidence of the BP World Energy Report behind me.” In scanning a summary of this year’s report, one statistic stands out for us. Environmental radicals constantly prattle on that renewable energy sources could replace fossil fuels, if we only had the will to change. What utter rubbish, as proven by this stat: In 2015 renewable energy, mostly used to generate power, reached 2.8% of global energy consumption, up 2% in the last ten years. Did you get that? Only 2.8% of the energy used in the world is generated by wind, solar, etc. Fossil fuels are here to stay through not only our own lifetimes, but the lifetimes of our children and grandchildren. Someday maybe we’ll be famous for having been prescient in penning these words (we’ll be long dead and gone)–but mark our words, fossil fuels are not going away any time soon…
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The Congressional Research Service (CRS) works exclusively for the United States Congress, providing policy and legal analysis to committees and Members of both the House and Senate, regardless of party affiliation. As a legislative branch agency within the Library of Congress, CRS has been a valued and respected resource on Capitol Hill for more than a century. Recently CRS wrote and published a report titled “An Overview of Air Quality Issues in Natural Gas Systems” (full copy below). The report looks at federal, state and local activities to help control air pollution from oil and gas–both drilling and pipelines. Without taking sides, this report provides information on the natural gas industry and the types and sources of air pollutants caused by the industry. The report examines the role of the federal government in regulating these emissions, including provisions in the Clean Air Act and EPA’s onerous regulatory activities. The report concludes with a brief discussion of the issues. Worth a read…
Each year the U.S. Chamber of Commerce issues an energy security risk report. The latest “Annual International Index of Energy Security Risk” (full copy below) shows the U.S. has jumped up the list by two spots in the world’s top 25 largest energy users. The jump up the list means the U.S. continues to improve its energy security. Why? According to the report–because of the miracle of hydraulic fracturing of shale. The report not only reviews America’s energy risk, but the risk for other countries as well. Who’s safe? Who’s vulnerable?…
Baker Hughes released their monthly rig count, for May, yesterday. While the worldwide rig count went up by 9, it continued to crash here at home in the U.S. May’s rig count in the U.S. was down another 7% (in one month), from April’s count. Sadly the trend was the same in the northeast. While PA’s count averaged the same month over month–16 active rigs–both OH and WV slid, with 10 rigs operating in each state. Overall the Marcellus/Utica rig count was down by 3 in the past month…
A new report just issued by Global consulting and research firm IHS, says that Canadian oil sands and U.S. “tight oil” (i.e. shale oil) production have “become the twin pillars of North American energy security.” Canada’s oil sands the shale in U.S. represent 95% of the growth in North American oil production from 2009-2015. Over the same time we reduced our dependence on offshore oil imports by 40%. Folks, this is HUGE. Fracking of shale is nothing short of a miracle in our country. For Crazy Bernie Sanders to shout, as he did at a rally in California last week, that “We are going to ban fracking all across this country” is insanity itself. Can you imagine if that fossil actually became President and signed an Executive Order banning all fracking? Hillary Clinton’s position is essentially the same as Crazy Bernie’s. Loony tunes. For the first time since the oil shocks of the 1970s when OPEC began to royally screw us over, we now can tell OPEC where to go pump their oil. You can see why Obama’s decision to deny the Keystone XL Pipeline from Canada is so stupid and damaging to our energy security…
A few weeks ago MDN brought you the news that the federal Environmental Protection Agency (EPA) has issued onerous new regulations on capturing every last molecule of methane all along the route from wellhead to burner tip (see 
Strong demand from electric power generators will push natural gas demand this summer up by an estimated 4 billion cubic feet per day (Bcf/d), according to a new report from the Natural Gas Supply Association (NGSA). However, even though there’s more demand, because supplies are so bountiful, the price of natural gas over the summer is actually expected to go down, not up. Using published data and independent analyses, NGSA evaluated the combined impact of weather, economic growth, customer demand, storage inventories and production activity on the direction of natural gas prices for the summer of 2016 compared to last summer. The NGSA says summer 2016 will see a “remarkable growth in demand.” Even so, NGSA expects “downward pressure on prices compared to last summer.” Bummer. It’s great news for consumers and power generating plants. But not so good news for drillers. Below we have a full copy of the NGSA report…
CNBC, not known for being an objective news source (witness the Republican debate debacle earlier this year), conducted a survey among 22 strategists, traders and analysts on the topic of the price of oil. MDN sometimes covers oil stories because natural gas oil are joined at the hip. Often the same E&Ps that drill for oil also drill for gas. And when you drill a hole in the ground, you get what you get–not only oil, but “associated gas” and gas liquids. Hydrocarbons of all kinds come out of the holes drilled. So it pays to pay attention to the oil market and what’s happening with the price of oil. According to the CNBC survey, those responding said overall they expect drilling to pick back up with the price hitting $50 per barrel. But they also said it won’t really pick up in earnest until the price hits $60 per barrel. Roughly half expect the price of oil to remain in the $40-$50 range until the end of 2016, with the other half thinking it will go higher. Only 9% believe come Dec. 31 the price will be at or above $60/barrel…
We’ve previously written about the so-called fossil fuel divestment movement–a push to get investors to dump stocks in oil and gas companies in a bid to bankrupt those companies (and send us all back to the energy Stone Age). Major universities hold huge investments of all kinds, including in fossil fuel companies. The crazies are pressuring them to dump those stocks. To their credit, the leaders of Cornell University said they will keep their fossil fuel investments (see 
In December MDN called attention to a newly published study by researchers at Dartmouth College (see 
The United States remained the world’s top producer of petroleum and natural gas hydrocarbons in 2015, according to our favorite government agency, the U.S. Energy Information Administration (EIA). U.S. petroleum and natural gas production first surpassed Russia in 2012. The U.S. has been the world’s top producer of natural gas since 2011 and the world’s top producer of petroleum hydrocarbons since 2013. We’re not only the Saudi Arabia of natural gas, we’re the Saudi Arabia of oil too! We love gloating about the fact that we’re #1 in the world! Energy = freedom. Fossil fuels = energy. Therefore, fossil fuels = freedom. If there’s a single word that still (for now) describes the good old U.S. of A.–it’s freedom. Tell the anti-American, anti-drillers to put that in their bongs and smoke it! Here’s the great news from EIA that we’re still the one…
In the past 12 months, some 27% of all E&Ps (exploration and production companies, what we call “drillers”) have defaulted on some of their bonds–the debt they owe. That’s huge. According to Fitch Ratings, before we turn the corner, they expect that number to grow to 30-35% of E&Ps. Defaulting on bonds doesn’t necessarily mean a company has filed for bankruptcy, but a plethora of bankruptcies have, according to Fitch, driven the bond default number way up. Here’s the latest on bond defaults and the sentiment that “it’s going to get worse before it gets better” from Fitch…
New research from the once-great Duke University actually supports shale drilling for a change–instead of denigrating it. In the past researchers from Duke, using money from the odious Park Foundation, have been bought off in their research efforts. This latest research, which concentrates on the benefits to local governments from shale drilling, wasn’t funded by Park and appears to be objective for a change. Two Duke U researchers conducted a three-year research project (between 2013-2015) funded by the Alfred P. Sloan Foundation. They traveled far and wide, to 16 states and interviewed over 200 local government officials along with gathering data and facts. The conclusion: on balance oil and gas drilling benefit local communities…
What has happened to one of the world’s finest research universities? A press release issued yesterday by Penn State touts their participation in helping set up a seismic monitoring system throughout Pennsylvania. In the announcement, Penn State researchers openly admit this about a series of tiny quakes in western PA that couldn’t be felt at the surface: “We have not done enough analysis of the data to make any conclusions yet, but there is a correlation spatially and temporally between the fracking and the earthquakes.” In other words–“We haven’t actually done the research, but we’re going to say there’s a connection between fracking and earthquakes–because we feel like it.” That’s not science–that’s politics. Real scientists observe first, then conclude. Penn State is reversing that order–they already have their conclusions, now it’s just a matter of warping the observations to fit their conclusions. Sad…