In time honored RBN blogging tradition – we’ve been at this blogging business three years –we look back today at the 250 blogs posted this year to see which ones had the highest hit rates. The number of hits any blog gets tells you a lot about what is going on in the energy markets – which topics resonate with our members, and which don’t attract much attention. Last year the big hitter blogs came in about 17,000 hits. This year the big numbers are closer to 50,000. With that many folks paying attention these days it is even more important that we take a page out of the late Casey Kasem’s playbook to look at the top blogs of 2014 based on numbers of website hits.
Over the past twelve months the hot topics have been dominated by crude oil – differentials, infrastructure, condensates, and of course most recently the demise of crude oil prices. But it was not all about oil. Three NGL market blogs made it into the top ten – one covering the propane price spike last year during the Polar Vortex, and the other two examining issues around ethane exports. Only one natural gas blog made the top ten, part of our series on constrained New England natural gas infrastructure. All these topics are associated with big market changes, and all have the potential to impact significant investment dollars. That makes them ideal themes for the RBN blogosphere.
Below we list the top 10 RBN blogs of 2014. But there’s more! If you want to see the full list of 2014 blogs then we provide below a downloadable, searchable index, organized by topic. We call it the Big Index. It is not very high tech – just an Excel spreadsheet. But it will help you find subject areas we covered that our search box might not pick up. It is organized in commodity groupings – crude oil, natural gas, NGLs and other. To download the spreadsheet, go to the bottom of this blog. (Note that you must be logged on to the site as a registered RBN member to download the spreadsheet.). Also, Backstage Pass subscribers have access to the Blog Finder, an easy way to find blogs of interest based on title, keywords and date ranges.
Here are the top 10 blogs of 2014 (in reverse order):
#10 – 4/10/14 – Natural Gas: Should I Store or Should I Burn—New England’s Gas Power Burn Outlook
New gas fired generation capacity is increasing the demand for natural gas in New England, and that is a problem in the winter when natural gas pipeline capacity is fully utilized for residential and commercial markets. The problem will continue until new pipeline capacity opens access to abundant Marcellus gas.
#9 – 1/26/14 – NGLs: A Perfect Storm – Polar Vortex Turns Propane Upside Down
The first few weeks of 2014 brought the perfect storm to propane markets. The combination of the Polar Vortex weather on the back of a wet corn drying season and record exports drove prices into record territory – more than $4.00/gallon in Conway. (That set the stage for a very different December 2014 market.)
#8 – 3/11/2014 – Crude Oil: Eight Bucks Low in the Permian – Midland Discount to Cushing Blows Out
With crude production surging and new pipelines coming online in fits and starts, Permian producers continue to experience tight takeaway capacity and crude price discounts. Small changes in the supply demand balance such as refinery maintenance and pipeline flow reductions have big price impacts.
#7 – 4/7/2014 – Crude Oil: Da Duvernay – The Golden Canadian Diluent Play?
If drilling activity and infrastructure development continue in the Canadian Duvernay play, the resulting production could provide significant diluent supplies to Western Canadian bitumen producers, reducing their demand for diluent imports from the U.S.
#6 – 10/8/2014 – Crude Oil: Crude Falls to Pieces – How Far Will it Tumble?
In early October, the handwriting was on the wall. Global crude prices were down by about 20 percent, as increasing supplies collided with lackluster demand. We said then that “there may be little to stop the slide in the near term until some new event impacts supply”. We know now that there was no such event, and prices continued to collapse.
#5 – 3/31/2014 – Crude Oil: Texas Bound and Flyin’ – Strained Gulf Coast Crude Infrastructure
The Gulf Coast crude oil market is being inundated with new supplies from new pipelines including TransCanada Cushing Marketlink, increasing crude-by-rail volumes, and other supplies coming via barge from the Eagle Ford and Midwest. All of these flows have important implications for Gulf Coast crude values and price differentials relative to Brent and Cushing WTI.
#4 – 2/9/2014 Crude Oil: Whole Lotta Splittin’ Going On – Condensate Splitter Economics
About 400 Mb/d of new condensate splitter capacity is under development, adding to the 75 Mb/d capacity at the BASF/Total splitter in Port Arthur. With discounted condensate prices, the splitter business was generally a money making proposition over the past year. But splitter margins rely on the availability of discounted condensate feedstocks. [A few weeks after this blog, Bureau of Industry and Security (BIS) rulings permitting the export of condensates became public.)
#3 – 4/5/2014 – NGLs: Changes in Longitudes — the Four Barriers to Ethane Exports
Ethane production has increased dramatically and prices have collapsed below fuel value. One alternative for the surplus ethane is exports. One overseas export terminal had been announced by ETP/Sunoco at the Marcus Hook, PA terminal. However, there are significant barriers to ethane exports. Two of these are the availability of terminal infrastructure and adequate shipping capacity.
#2 – 4/9/2014 - NGLs: Changes in Longitudes — More Barriers to Ethane Exports
This blog continued the series in #3 above considering two more barriers to ethane exports: pricing structures that fit the needs of buyers and sellers, and petrochemical demand that must be developed to use the exported ethane. [About two weeks after this blog, Enterprise announced construction of a Gulf Coast ethane export terminal.]
#1 – 8/10/2014 – Crude Oil: Saving All My Crude for You – Houston We Have A (Storage) Problem
Houston area refineries are currently operating with about a third less onshore storage (measured in storage days) than comparable refineries in other regions. Waterborne crude imports help to alleviate the challenges that this constraint can cause. But Houston is importing much less waterborne crude. When you add the challenges of handling crude quality issues, including a potential new requirement to segregate certain types of condensate, it certainly looks like more storage capacity in the Houston area is needed.
This blog is part 6 of a seven part series on Houston crude oil storage. Part 1 covered the changing crude storage situation at the Gulf Coast. In Part 2 we showed that the typical imported waterborne barrel delivered to Houston refineries spent 17-20 days in floating storage. In Part 3 we calculated Houston area refinery storage days at 21-23 days depending on refinery throughput versus a Gulf Coast average of 32 days. In Part 4 we reviewed new crude pipeline flows into the Houston area. Part 5 looked at the challenges refiners could run into unless more storage flexibility is added to the system than current plans allow. Part 7 concluded with thoughts about future storage requirements in the Houston area for refiners, producers and trading companies.
Deeper Meaning from the Hit Parade
Caveats. We need to mention a couple of caveats to this hit parade. First, hits for individual blogs accumulate throughout the year, so that means that blogs posted early in the year generally have more hits than those posted at the end of the year. That’s why you see many of the blogs with posting dates in the first few months of 2014. Second, the sample is somewhat skewed by the number of blogs we do on a particular topic – and again this year we did more blogs on crude oil topics than on natural gas and NGLs. That is where the action was, so that is what we blogged about.
Common Themes. For the past two years in this year-end blog we have attempted to identify the common themes that permeate the blog hit parade. We find those same themes carry into the kind of engagements our consulting team gets involved in – also an indication of market sentiment. In 2013, the theme was surplus. In that year energy markets came to terms with the fact that natural gas, NGLs and some grades of crude oil would be oversupplied for many years to come. This year has been focused on demand – Where all those hydrocarbons are going to go? Domestic demand has been growing, but not nearly at the pace of supply. So that means the surpluses must be exported. NGLs are being exported, natural gas will be exported in the form of LNG, condensates are already being exported, and crude oil imports are falling like a rock, with a market impact essentially identical to exports.
But exports have not been enough to balance the market. Surpluses continue to dominate these markets, either because infrastructure is not yet available for export volumes, or – more worrisome – international markets are not able to absorb the volumes. Thus as we enter 2015, the new theme is clearly price. If the combination of domestic markets and exports are not enough to balance supply and demand, something has to give. And that something is price. Price must drop low enough to discourage production by someone. The big questions are who, when and where. Our first blog of the New Year on January 2nd will explore these questions further in The Top Ten Energy Prognostications for 2015 – Year of the Goat. Really. We did not make that up.
Happy New Year!
We hope this blog and the 2014 Big Index will be useful to you. We are always open to suggestions so if you have ideas for topics we should cover, please fire them off to [email protected]. Have a safe and happy New Year’s holiday. We’ll see you back here in 2015!
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Thanks for the memories - Diane & Bobby