Oil industry analysts can't decide how crude prices might change by the end of the year. With a huge inventory already in the stockpile, global demand is going to determine the price.
It's not much, but Americans are using more fuel this year than last year. Numbers released by the American Petroleum Institute show that U.S. petroleum deliveries increased by 2.5 percent in September 2011, compared to September 2010. API chief economist John Felmy – always the economist, that's for sure – released this statement:
On Thursday, U.S. Department of Energy Secretary Steven Chu announced that the U.S., along with its partners in the International Energy Agency, has decided to release a total of 60 million barrels of oil from strategic reserves within the next 30 days. This move is to offset the disruption in oil supply caused by continued unrest in the Middle East. For its part, the U.S. will release 30 million barrels of oil from its Strategic Petroleum Reserve (SPR). According to the DOE, the SPR currently h
Back in April of 2010, the Deepwater Horizon burst into flames and sank into the sea. For months, clean-up crews worked to contain the oil that spewed out at a rapid rate. In early May, President Obama announced that no additional deepwater drilling efforts would commence until measures to prevent the recurrence of this type of disaster were in place. Well, last October, the U.S. Secretary of the Interior, Ken Salazar, announced that deepwater drilling would resume.
According to the International Energy Agency (IEA), Saudi Arabia has boosted its oil output to compensate for shortages in global crude supply caused by the unrest in Libya. Reports confirm that Saudi officials have met with European refiners to discuss the amount of oil required to fill the shortfall, estimated to be 1.2 million barrels of oil per day. An IEA spokesman released a statement claiming that there's "every indication that increased volumes are now being made available to the market"
According to the DOE's Energy Information Administration (EIA), crude oil prices are expected to steadily increase over the next two years, hitting $99 per barrel by the end of 2012. Tightening of world oil markets, along with a growth in consumption, will continue to drive oil prices up from the recorded average of $89 a barrel in December 2010 to an estimated $93 per barrel for 2011.
British Petroleum (now known as simply BP) has found a way to dodge around a Great Lakes anti-pollution law. The law, written in 1970, set a limit on the amount of waste sludge and ammonia that could be dumped into Lake Michigan, as the level of pollution in the lake was getting way out of hand. A clause in the law stated that if a company was dumping at an amount under the limit, they could not increase their pollution, even if it was still under the primary limit.
In conjunction with other measures to protect the U.S. from crude oil price shocks such as promoting alternative fuel research and production, President Bush has announced an expansion of the U.S. Strategic Petroleum Reserves. The reserves, which were established in 1975 following the Arab oil embargo, are assets designed to limit the effects of severe supply disruption.
Falling oil prices are starting to claim some biofuel casualties in India, with biodiesel not being able to compete at the pump. With crude oil dropping to around $50 per barrel, diesel in India currently costs around Rs 36 per litre (US$3.10 per gallon) which makes biodiesel at Rs 41 per litre ex-factory plus taxes look very expensive. The India Times quotes the managing director of a biodiesel company in Maharashtra as saying, "With such a stark difference, we have no option but to shut down p
With all the talk and rumors over the last month, we expected to see OPEC cut oil production by 1 million barrels per day. However, according to Reuters, Friday's announcement of the deeper than expected cut of 1.2 million barrels seemed to send an intended message to buyers on the oil market: if the price of oil does not stabilize, OPEC would be open to even deeper cuts.
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