FROM THE OIL PATCH
Shale giants dump oil hedges as losses spiral toward $42 billion
U.S. shale giants stung by billions of dollars in hedging losses are spending big bucks to ditch their positions in a risky bet that prices stay high. Companies including Pioneer Natural Resources Co. and EOG Resources Inc. are poised to post historic profits when they report earnings this week. But those windfall earnings would be even higher if it weren’t for massive accounting losses from hedges that protect against falling prices while limiting upside potential. Producers in the aggregate are looking at about $42 billion in oil and gas hedging losses through 2023, according to BloombergNEF calculations of data from last year. While such
Steel market losing momentum as U.S. faces severe OCTG supply shortage
Following the dramatic recovery in U.S. steel production last year – a more than 18% year-on-year increase – the market is increasingly losing momentum. Output has fallen in April after flatlining in the first quarter, bringing the year-to-date change to -1.6% year on year. While capacity utilization is not exceptionally high – about 80% this year – raw materials’ restrictions since Russia’s invasion of Ukraine are constraining the U.S. steel output potential, not to mention inflating domestic prices of scrap, which surged over $750 per gross ton last month. Russia is the U.S.’s fifth most important supplier of steel, including semis,
Oil prices: Barring recession, expect high energy prices for several years, says analyst
Gasoline and diesel prices are hitting all-time highs again — at a national average of $4.40 and $5.55 per gallon, respectively. Higher fuel costs are prompting some consumers to change their driving patterns, with drivers consolidating grocery shopping trips to save on gas. Analysts predict if a recession were to occur,
U.S. shale’s cash bonanza is about to wipe out $300 billion loss
It may have taken an investor rebellion, a pandemic and a war in Europe, but U.S. shale oil and gas producers are now on the cusp of making back their losses from the last decade. The industry is on course to make $172 billion of free cash flow this year,
Gulf of Mexico oil drilling makes comeback, but won’t close supply gap
A new wave of oil platforms is sweeping into the U.S. Gulf of Mexico as crude prices are riding historic levels and demand for barrels is higher than ever. But don’t count on the new production to close the oil-supply gap that has plagued the world’s economies since the pandemic. Even with the new platforms
AMERICAN CRUDE OIL COMES TO EUROPE’S RESCUE
The United States is surging exports of crude oil to Europe as the continent looks to curb Russian imports in the wake of the continued assault on Ukraine. While much of the focus on Europe’s energy crisis has focused on natural gas – another sector where U.S. exports have played
CRUDE OIL WEEKLY UPDATE (Week Ending 05-13-22)
Crude Oil Summary (EIA): U.S. crude oil refinery inputs averaged 15.7 million barrels per day during the week ending May 6, 2022 which was 230,000
NATURAL GAS WEEKLY UPDATE (Week Ending 05-13-22)
In the News (EIA): Natural gas consumed for U.S. electric power sets January record in 2022: In January 2022, natural gas consumed for electric power
Zekelman Industries Steel Snapshot for May 2022
(by Mike Mechley, Executive VP of Strategic Procurement, www.ZekelmanIndustries.com) Platts May HR Coil $1,380, down $120 from April. Mini mills panic to secure pig iron
Preston Pipe Report – April 2022
(by Paul Vivian and Rick Preckel, www.prestonpipe.com) Market Monitor – President Joe Biden announced an agreement in late March committing the US LNG industry to
Pipe Logix Line Pipe Report – April 2022
(by Kurt Minnich, www.pipe-logix.com) Line pipe prices jumped again in April with the Pipe Logix Price Index up 7.6% to $3,656/ton. Prices for many seamless
AISI Press Release on Latest U.S. Imports of Steel Products – May 2022
(American Iron and Steel Institute, www.steel.org – May 6, 2022) Based on the Commerce Department’s most recent Steel Import Monitoring and Analysis (SIMA) data, the
