Wednesday, September 27, 2023
  • Submit news
  • Contact
  • DMCA
  • Cookie Privacy
  • Privacy Policy
  • Terms of Use
Oil Market News
  • Home
  • Marketdaily
  • Price
  • crudenow
  • Companies
  • politics
  • Gas
  • investing
  • Stock
  • OPEChot
  • brend
  • ships
Oil Market News
Home Price

Energy Indicators – Dallasfed.org

8 months ago
in Price
Energy Indicators – Dallasfed.org
Share on FacebookShare on Twitter


Economic Indicators

January 19, 2023

Energy prices have been dropping since summer as softening economic data and warmer-than-normal weather lowered demand expectations. Oil production continued to increase in the U.S. shale oil basins. Oil executives expect to increase their capital spending in 2023 but are wary due to uncertainty surrounding the future price of crude oil and the current domestic political climate.

Energy prices

Energy prices broadly decreased in the fourth quarter of 2022. West Texas Intermediate (WTI) priced in Midland, closer to the wellheads of the Permian Basin, and Dated Brent spot prices were at $77.37 and $81.52 per barrel, respectively, for the four-week moving average ending Dec. 30, 2022. Those were the lowest nominal prices since December 2021, but they remain above prepandemic levels (Chart 1). Oil prices have been falling due to worries of a potential recession in Europe, rising interest rates and a COVID-19 policy in China that could curtail fuel demand. Prices have fallen roughly 30 percent from their peak in mid-2022.

Chart 1

West Texas’ Waha Hub natural gas spot price averaged $1.65 per million British thermal units (MMBtu) for December 2022 but swung as high as $5.40 due to a demand boost from a sharp but short lived wintry blast. It also swung as low as negative $3.90 per MMBtu after warmer weather returned and maintenance temporarily reduced takeaway capacity, trapping production in the basin—an increasingly likely scenario until new pipelines are built. The Henry Hub natural gas spot price averaged $5.47 per MMBtu for December, down 39 percent from its peak in August 2022.

Production and rigs

Production in Permian Basin continues to rise

The Permian Basin saw continued production increases to close out 2022. Oil production is up 11 percent from the year-ago level. Total production for both oil and gas together is up 19 percent from prepandemic levels. November saw 5.5 million barrels per day (mb/d) of oil production and, using an oil-equivalent conversion factor, 3.7 million barrels per day of gas (Chart 2). However, producers in the region are uncertain about the growth outlook in 2023 because of cost inflation and shortages in drilling equipment, rigs and crews.

With gas production on the rise, analysts, and industry leaders worry that the Permian’s natural gas infrastructure capacity will become constrained by late 2023 and limit production increases.

Chart 2

The region achieved this production growth in part by drilling longer wells and substantially improving efficiency. The Permian rig count in the U.S. Energy Information Administration’s drilling productivity report totaled 349 at the end of November, up 28 percent year over year, but still 14 percent below its prepandemic level.  

Production growth outside Permian more modest; rig count rises

Aggregate oil and gas production in other oil-focused shale basins (the Anadarko, Bakken, Eagle Ford and Niobrara) rose 7 percent to 7.5 mb/d in November 2022 (Chart 3). That level is still 10 percent below prepandemic levels. Oil production rose from 3.4 to 3.6 mb/d, 16 percent below prepandemic levels.

Total U.S. oil production stood at 130 mb/d from January to November of last year, with the Permian accounting for 44 percent of total production and the other basins mentioned accounting for only 29 percent combined.

Chart 3

Rig counts in the other major oil basins have been rising since mid-2020, going from 110 in June 2020 to 346 in November 2022 and rising 38 percent more from the start of the year. The count accelerated as energy prices rose for most of 2022.

The modest production increases seen in the other basins may not last in 2023. Recent comments from some oil producers indicate that shale output growth in the U.S. could slow to 300,000 to 400,000 barrels a day in 2023, compared with between 500,000 and 600,000 in 2022.

Dallas Fed Energy Survey special questions

Crude oil price used for planning ticks up

Oil production firms interviewed between December 7 and 15 for the Dallas Fed’s Energy Survey said they expect oil and fuel prices to creep up this year due to underinvestment in the fossil fuel sector, a cooperative OPEC+ willing to limit supply, and a lack of refining capacity. On average, oil executives said they were using a price of $73 per barrel for their capital planning in 2023 (Chart 4), compared with the $64 per barrel used for planning in 2022. Respondents also indicated that there is still a lot of price uncertainty as world economic growth is projected to slow in 2023, with many believing the supply level will remain stable.

Increase in capital spending expected

Thirty-nine percent of respondents said they expect capital spending to increase slightly in 2023 versus 2022, but it isn’t clear if that will be due to greater activity or elevated input costs (Chart 5). Twenty-five percent of respondents predict a significant increase in capital spending, while only 14 percent of respondents anticipate a reduction in spending.

Chart 5

Some respondents noted a lack of capital available to increase supply. Many blamed the Biden administration’s vilification of the fossil fuel industry and the accelerated push to clean energy. Concerns centered on policies that could result in increased regulation and extra taxation. Even with so much uncertainty, Barclay’s recent spending survey found that oil and gas companies’ global spending is expected to increase 13 percent in 2023 following a 20 percent upsurge in 2022.

About Energy Indicators

Questions can be addressed to Kenya Schott at kenya.schott@dal.frb.org. Energy Indicators is released monthly and can be received by signing up for an email alert. For additional energy-related research, please visit the Dallas Fed’s energy home page.



news.google.com

Latest Oil News

Marathon Petroleum Corporation (NYSE:MPC) Q4 2022 Earnings Call Transcript

Marathon Petroleum Corporation (NYSE:MPC) Q4 2022 Earnings Call Transcript

February 1, 2023
Oil Under Pressure As API Reports Large Crude, Product Builds

Oil Under Pressure As API Reports Large Crude, Product Builds

January 31, 2023
African economies: How to respond to rising global crises

African economies: How to respond to rising global crises

January 30, 2023
Fuel prices to increase by 7%-13% from February 1, 2023 – IES

Fuel prices to increase by 7%-13% from February 1, 2023 – IES

January 29, 2023
Tags: DallasDallasfedorgEnergyFederal ReserveindicatorsMonetary PolicypricesTexas economy
Previous Post

Net zero tsar: Tories will lose election without strong climate policies | Chris

Next Post

China Wants to Be the OPEC of Renewables, but There’s Competition

Related Posts

Marathon Petroleum Corporation (NYSE:MPC) Q4 2022 Earnings Call Transcript

Marathon Petroleum Corporation (NYSE:MPC) Q4 2022 Earnings Call Transcript

by Oil Market News
February 1, 2023
0

Marathon Petroleum Corporation (NYSE:MPC) Q4 2022 Earnings Call Transcript January 31, 2023Operator: Welcome to the MPC Fourth Quarter 2022 Earnings...

Oil Under Pressure As API Reports Large Crude, Product Builds

Oil Under Pressure As API Reports Large Crude, Product Builds

by Oil Market News
January 31, 2023
0

Crude oil inventories rose by another 6.33 million barrels last week, the American Petroleum Institute (API) data showed on Tuesday,...

African economies: How to respond to rising global crises

African economies: How to respond to rising global crises

by Oil Market News
January 30, 2023
0

Treasury CS Prof Njuguna Ndung'u. The Covid-19 pandemic triggered a profound setback after a quarter-century of economic and social progress....

Fuel prices to increase by 7%-13% from February 1, 2023 – IES

Fuel prices to increase by 7%-13% from February 1, 2023 – IES

by Oil Market News
January 29, 2023
0

The Institute for Energy Security (IES) is predicting between 7% and 13% jump in the prices of petrol, diesel and...

Why Germany Dragged Its Feet on Leopard Tanks to Ukraine

Why Germany Dragged Its Feet on Leopard Tanks to Ukraine

by Oil Market News
January 28, 2023
0

The decision to provide heavy tanks to Ukraine in significant numbers constitutes a step change in western military support for...

Indexes Rally and Notch Weekly Gains

Indexes Rally and Notch Weekly Gains

by Oil Market News
January 27, 2023
0

US stocks closed higher Friday after reversing early-session losses.  Easing inflation data added to investor optimism that the Federal Reserve...

Next Post
China Wants to Be the OPEC of Renewables, but There’s Competition

China Wants to Be the OPEC of Renewables, but There's Competition

Subscribe
Notify of
guest
guest
0 Comments
Inline Feedbacks
View all comments

Trend Oil News

Army Corps of Engineers Withdraws Approval of Plans to Dredge a Superfund Site on the

Army Corps of Engineers Withdraws Approval of Plans to Dredge a Superfund Site on the

9 months ago
Nigeria’s Revenue to Boom as Brent Oil Rises Above $93 in 7years

Nigeria’s Revenue to Boom as Brent Oil Rises Above $93 in 7years

1 year ago
Iraq wins landmark case against Turkey over Kurdish oil exports

Iraq wins landmark case against Turkey over Kurdish oil exports

6 months ago
Shale Oil Stock Continental Resources Beats Views, Steps Up Spending As Oil Nears

Shale Oil Stock Continental Resources Beats Views, Steps Up Spending As Oil Nears

1 year ago
Devon Energy: Growing Oil Supply Crunch To Offset Potential Demand Decline (NYSE:DVN)

Devon Energy: Growing Oil Supply Crunch To Offset Potential Demand Decline (NYSE:DVN)

9 months ago
ADVERTISEMENT
Crude Oil Shielded From Bond and Stock Market Rout

Diesel/Russia: oil sanctions help tighten supply for industrial fuel

September 26, 2023

Russia dodges G7 price cap sanctions on most of its oil exports

September 25, 2023

Deep divisions over oil and gas industry role challenge UN climate talks

September 24, 2023

Bets on energy transition spark rise in North American pipeline deals

September 23, 2023

Will oil price rally mean even higher air fares?

September 22, 2023

Russia puts squeeze on oil market with diesel export ban

September 21, 2023

Crude Oil

4 Days from Deadline, EU Fails To Agree On Russian Oil Products Price Cap

4 Days from Deadline, EU Fails To Agree On Russian Oil Products Price Cap

February 1, 2023
Oil rises after U.S. fuel stocks draw down; economic concerns loom

Oil prices settle steady on higher U.S. demand, weaker dollar

January 31, 2023
S&P 500 Down 1%; Crude Oil Drops Over 2%

S&P 500 Down 1%; Crude Oil Drops Over 2%

January 30, 2023
Russia Can’t Replace the Energy Market Putin Broke

Russia Can’t Replace the Energy Market Putin Broke

January 29, 2023

Investing

Orbital Sidekick Raises $10M Investment to Monitor Oil and Gas Industry from Space 

Orbital Sidekick Raises $10M Investment to Monitor Oil and Gas Industry from Space 

February 1, 2023
Crude Oil Shielded From Bond and Stock Market Rout

Clean-energy investing poised to top money backing oil and gas after hitting a record

January 31, 2023
Crude Oil Shielded From Bond and Stock Market Rout

The Cushing® MLP & Infrastructure Total Return Fund Announces Fund Name Change

January 30, 2023
Boeing’s 747, the original jumbo jet, prepares for final send-off By Reuters

Boeing’s 747, the original jumbo jet, prepares for final send-off By Reuters

January 29, 2023

Market

Crude Oil Shielded From Bond and Stock Market Rout

Diesel/Russia: oil sanctions help tighten supply for industrial fuel

September 26, 2023
Crude Oil Shielded From Bond and Stock Market Rout

Russia dodges G7 price cap sanctions on most of its oil exports

September 25, 2023
Crude Oil Shielded From Bond and Stock Market Rout

Deep divisions over oil and gas industry role challenge UN climate talks

September 24, 2023
Crude Oil Shielded From Bond and Stock Market Rout

Bets on energy transition spark rise in North American pipeline deals

September 23, 2023

OPEC

US Close- Fed signals more hikes coming, Powell says disinflation process begun, ADP

US Close- Fed signals more hikes coming, Powell says disinflation process begun, ADP

February 1, 2023
‘OPEC does not control the price’: OPEC President | OPEC News

‘OPEC does not control the price’: OPEC President | OPEC News

January 31, 2023
OPEC+ Closely Watches Chinese Factory Data

OPEC+ Closely Watches Chinese Factory Data

January 30, 2023
Week Ahead: FOMC, BOE, ECB, OPEC, NFP and Big Tech Earnings

Week Ahead: FOMC, BOE, ECB, OPEC, NFP and Big Tech Earnings

January 29, 2023
  • Submit news
  • Contact
  • DMCA
  • Cookie Privacy
  • Privacy Policy
  • Terms of Use

© 2022 OilMarket.News

No Result
View All Result
  • Home
  • Market
  • Price
  • crude
  • Companies
  • politics
  • Gas
  • investing
  • Stock
  • OPEC
  • brend
  • ships

© 2022 OilMarket.News

wpDiscuz
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.