Continental US oil producers will reduce their drilling budgets by $150 billion by next year, according to a Wood Mackenzie report. The firm projects that worldwide crude oil product will decrease by 4.2 million barrels of oil equivalent per day by 2020.
Over 8,000 positions were cut by Schlumberger during the second quarter after doing the same in the first quarter. The company also eliminated 10,000 jobs in the fourth quarter of 2015.
Attorney Kenneth Feinberg said during a federal fraud case Wednesday that he was skeptical about the number of claims being reported while handling a claims fund resulting from the 2010 Gulf of Mexico oil spill. He testified at the trial for San Antonio attorney Mikal Watts and six co-defendants, who are accused of inflating the client list to generate more claims.
The Alameda County Board of Supervisors approved a hydraulic fracturing ban on Tuesday, even though the only company drilling in the California county does not use the technique. The county is the fifth in the state to enact such a ban.
The East Coast, West Coast and Gulf Coast regions saw refining margin increases during the week ended July 15, according to a Credit Suisse report. East Coast margins increased by 51 cents, while West Coast and Gulf Coast margins rose by 44 cents and 5 cents, respectively.
Oil producers including Linn Energy, Penn Virginia and Energy XXI have liquidated lucrative hedges due to bankruptcy laws that fail to protect hedges from foreclosure in the way that land and equipment are protected. Oil firms that are forced to sell their hedges during bankruptcy proceedings are left "naked against the market prices," according to Wunderlich Securities analyst Jason Wangler.
September crude oil dropped by $1 to $44.75 a barrel on the New York Mercantile Exchange on Thursday, while stockpiles of gasoline increased by 911,000 barrels last week. "It's been a bit of a hangover from the inventory report yesterday," said ClipperData Director of Commodity Research Matt Smith about the price drop.
Reports of broken bolts on blowout preventers on Gulf of Mexico rigs have led to additional concerns about underwater hardware defects. Federal officials are attempting to assess the risk of these bolts breaking and leading to a "catastrophic failure."
Due to reduced costs, Range Resources, Cabot Oil & Gas and EQT are all projected to withstand the volatile natural gas market conditions being driven by a summer glut, said David Holt, equities analyst for Global Market Intelligence. "We think low-cost producers that exhibit financial flexibility in 2017 ... remain well positioned to navigate through the current commodity cycle," Holt said.
Increased horizontal drilling is contributing to a renewed demand for Halliburton's fracking equipment. "Let me start today with a headline: 900 is the new 2,000 for US rig activity," said Jeff Miller, president of the company.
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