RBN Energy

The March appropriations bill passed by Congress and signed by President Biden to fund the federal government mandated the emptying of the federal gasoline reserve in fiscal year 2024, which concludes September 30, followed by its eventual closure. That means about 1 MMbbl — 42 MM gallons — of gasoline will find its way to the market in the next few months, or in as little as a few weeks. The Department of Energy (DOE) is planning to distribute those barrels by the end of June to help keep a lid on gasoline prices ahead of the July 4 holiday and into the heart of the summer driving season. In today’s RBN blog, we look at the decision to close the reserve and the potential impact of those barrels hitting the market. 

Analyst Insights

Analyst Insights are unique perspectives provided by RBN analysts about energy markets developments. The Insights may cover a wide range of information, such as industry trends, fundamentals, competitive landscape, or other market rumblings. These Insights are designed to be bite-size but punchy analysis so that readers can stay abreast of the most important market changes.

By Kristen Hays - Tuesday, 6/11/2024 (2:45 pm)
Report Highlight: NGL Voyager

GAIL Limited, India’s primary natural gas supplier, is planning to build a 3.3 billion lb/year cracker in central India.

By Sheela Tobben - Tuesday, 6/11/2024 (2:15 pm)

At least one U.S. refiner has secured fresh term supply contracts to get Mexican crude as the producer south of the border grapples with issues at its newest and older refineries, limiting their need for domestic oil production, at least for now.

Recently Published Reports

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Chart Toppers Chart Toppers - June 12, 2024 8 hours 7 min ago

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Daily Energy Blog

Category:
Refined Fuels

The federal Renewable Identification Number (RIN) and California’s Low Carbon Fuel Standard (LCFS) have long served as tools to force renewable fuels like ethanol into the U.S. fuel supply. They are environmental credits that subsidize production of renewable fuels that would not otherwise be economically justified. Nuances embedded in the design of these credit systems have again kicked in to surprise the markets, this time with a hit to renewable diesel (RD) margins. Today’s RBN blog zeroes in on two root causes for that hit. 

Category:
Crude Oil

Bluewater Texas, proposed by a 50/50 joint venture (JV) of Phillips 66 (P66) and commodity trading giant Trafigura, is in a unique position in the race to construct a deepwater crude oil export facility along the U.S. Gulf Coast. Of the four marketed deepwater proposals, Bluewater is the only project in the export-centric Corpus Christi market. It is also the only one in the group that does not include an offshore platform in its scope. In today’s RBN blog, we will explore these and other differences that set Bluewater apart. 

Category:
Natural Gas

To closely analyze the natural gas market is to be constantly bombarded with vast amounts of information — weather forecasts, pipeline flows, LNG feedgas, power demand and storage — that is frequently updated, impacting both spot and future prices. But before you can get into the deeper analysis, you’ve got to understand the natural gas value chain and its terminology. In today’s RBN blog, we’ll explain the various terms used to describe natural gas as it moves from wellhead to consumer. 

Category:
Financial

A macro view of U.S. exploration and production (E&P) company performance over the last quarter century reveals repetitive boom-and-bust cycles driven by periodic extremes in crude oil pricing, including price crashes in 2008, 2014 and 2020. That history contrasts with the remarkable stability in West Texas Intermediate (WTI) realizations since mid-2021 as the industry got its footing post-pandemic. Assisted by a new commitment to financial discipline, producers have generated relatively stable, historically solid overall quarterly earnings and cash flows. But the devil’s in the details, and in today’s RBN blog we delve into peer group and individual company performance as well as overall industry trends for Q1 2024. 

Category:
Financial

Permian-focused M&A activity may grab all the headlines, but don’t forget about the Eagle Ford. Over the past couple of years, a steady stream of big-dollar deals have been announced in the South Texas shale play, most of them tied to efforts by growth-oriented E&Ps to increase their scale, improve their operational efficiency and expand their inventory of top-tier drilling sites. As we’ll discuss in today’s RBN blog, the dealmaking has continued this spring, most recently with Crescent Energy’s announcement that it will be acquiring SilverBow Resources. 

Category:
Crude Oil

Situated in West Texas’s Winkler County, the tiny city of Wink (population just under 1,000) might seem easy to overlook but it holds a special place in music history as the childhood home of Roy Orbison — he formed his first band, the Wink Westerners, there in 1949. But beyond its rich musical legacy, Wink in recent years has emerged as a key hub for crude oil connectivity in the prolific Permian Basin. Don’t blink or you might miss out on what’s happening in this dynamic locale, the subject of today’s RBN blog. 

Category:
Crude Oil

If you asked someone where U.S. crude oil shipments would go when the Obama administration ended the ban on most crude exports in December 2015, it’s not likely that Nigeria would have come to mind. Yet this year marked the second time since the restrictions ended that U.S. oil has been sent to the OPEC member, this time to feed its long-awaited Dangote refinery. In today’s RBN blog, we will examine this development and the prospects for more U.S. exports to the West African nation. 

Category:
Financial

Another day, another mega-deal between top-tier oil and gas producers — or so it seems. Now, it’s ConocoPhillips and Marathon Oil’s turn, and you’d be hard-pressed to find a more logical pairing among the ever-shrinking list of big E&Ps that hadn’t already found a partner during the ongoing frenzy to consolidate. In today’s RBN blog, we examine ConocoPhillips’s newly announced, $22.5 billion agreement to acquire Marathon Oil with a look at their similar histories, their complementary assets, and what will now be their joint effort to boost shareholder returns. 

Category:
Natural Gas

Energy Transfer is yet again slaking its acquisition appetite by gobbling up another natural gas gatherer and processor to further expand its already formidable Permian footprint. The company announced May 28 that it has struck a $3.25 billion cash-and-stock deal to buy WTG Midstream, a West Texas-based and private equity-backed operator whose Permian assets will boost the acquiring company’s access to gas and NGL volumes as the U.S. midstream sector shows continued consolidation. In today’s RBN blog, we’ll look at how the addition of WTG’s midstream holdings will enhance Energy Transfer’s asset lineup, including its ongoing NGL export and storage expansions. 

Category:
Natural Gas Liquids

With an announcement in late 2023 by Dow Chemical that it would be undertaking an enormous expansion of its ethylene production site in Fort Saskatchewan, AB, it was immediately clear that Alberta’s ethane supplies would need to increase by a significant 110 Mb/d. As we’ll discuss in today’s RBN blog, a deal was signed in February between Dow and Pembina Pipeline Corp. that calls for the midstreamer to provide up to 50 Mb/d of additional ethane supplies and, according to executives at Pembina’s investor day earlier this month, will require the company to invest between C$300 million (US$220 million) and C$500 million (US$367 million) to build out its existing NGL/ethane infrastructure.

Category:
Crude Oil

On the surface, the Bakken story in the mid-2020s may seem as boring as dirt. The boom times of 2009-14 and 2017-19 are ancient history. Crude oil production has been rangebound near 1.2 MMb/d — well below its peak five years ago. And that output has been getting gassier over time, creating natural gas and NGL takeaway constraints that have put a lid on oil production growth. But don’t buy into the view that the Bakken is yesterday’s news. Beneath the surface (sometimes literally), the U.S.’s second-largest crude oil production area is undergoing a major transformation that includes E&P consolidation, production (and producers) going private, the drilling of 3- and (soon) 4-mile laterals, novel efforts to eliminate flaring, and even a producer-led push for CO2-based enhanced oil recovery (EOR). As we’ll discuss in today’s RBN blog, these changes and others may well breathe new life into the Bakken and significantly improve the environmental profile of the hydrocarbons produced there. 

Category:
Energy

There’s never been any reason to question the drivers for energy infrastructure development — until now.  Historically, the drivers were almost always “supply-push.” The Shale Revolution brought on increasing production volumes that needed to be moved to market, and midstreamers — backed by producer commitments — responded with the infrastructure to make it happen. But now things seem to be different. U.S. energy infrastructure investment is soaring across crude oil, natural gas and NGL markets and, as in previous buildouts, midstreamers are bringing on new processing plants, pipelines, fractionators, storage facilities, export terminals and everything in between. We count nearly 70 projects in the works. But crude production has been flat as a pancake, natural gas is down, and lately NGLs are up — but as you might expect, only in one basin: the Permian. So what is driving all the infrastructure development this time around? In today’s RBN blog, we’ll explore why that question will be front-and-center at our upcoming School of Energy: Catch a Wave. Fair warning, this blog includes an unabashed advertorial for our 2024 conference coming up on June 26-27 in Houston. 

Category:
Natural Gas Liquids

Rome wasn’t built in a day and neither were the large, wellhead-to-market natural gas and NGL networks that Phillips 66 and a handful of other midstream empires have assembled — many of them targeting the all-important Permian. Now, P66 has reached an agreement to acquire Pinnacle Midstream, whose associated gas gathering system and gas processing complex in the heart of the Midland Basin nicely complement a host of other gathering and processing assets P66 controls through its majority stake in DCP Midstream. In today’s RBN blog, we’ll discuss P66’s planned purchase of Pinnacle Midstream and what it means for the Permian piece of the acquiring company’s broader natgas/NGL system. 

Category:
Crude Oil

The Houston crude oil hub has become busier over the last few months, and if one or more proposals to build a deepwater export terminal nearby capable of fully loading a Very Large Crude Carrier (VLCC) cross the finish line, it could become the hub supplying them. That could push Permian Basin oil flows on Houston-bound pipelines higher at the expense of flows to Nederland and Corpus Christi. In today’s RBN blog, the third in a series, we will examine the latest Permian oil flows to Houston and how that could change if and when a deepwater project comes online. 

Category:
Energy

There’s never been any reason to question the drivers for energy infrastructure development — until now.  Historically, the drivers were almost always “supply-push.” The Shale Revolution brought on increasing production volumes that needed to be moved to market, and midstreamers — backed by producer commitments — responded with the infrastructure to make it happen. But now things seem to be different. U.S. energy infrastructure investment is soaring across crude oil, natural gas and NGL markets and, as in previous buildouts, midstreamers are bringing on new processing plants, pipelines, fractionators, storage facilities, export terminals and everything in between. We count nearly 70 projects in the works. But crude production has been flat as a pancake, natural gas is down, and lately NGLs are up — but as you might expect, only in one basin: the Permian. So what is driving all the infrastructure development this time around? In today’s RBN blog, we’ll explore why that question will be front-and-center at our upcoming School of Energy: Catch a Wave. Fair warning, this blog includes an unabashed advertorial for our 2024 conference coming up on June 26-27 in Houston.