The dramatic drop in crude oil prices has led many countries that are dependent on oil revenues to keep producing or, where possible, increase production. Saudi Arabia is the best example, but Iraq, Iran, and the other Gulf Arab states are doing the same. In the short run, this is helping keep oil prices low. Some are suggesting the price of US crude oil could fall into the $30 level in the next year or so.

For the next year or so all indications indicate there will be more crude oil supply than can be consumed. US crude oil inventories are 100 million barrels above normal for the time of year. Despite the 60% in the rig count, shale oil output in the US has remained relatively stable and any decline in production that is currently underway is not likely to be important given the size of the global oversupply of oil. Many observers say that Iran could probably increase crude oil exports by 500,000 barrels per day within six months and 1 million b/d within a year if it can find buyers. And if Iran receives substantial assistance from foreign oil companies, it could be producing 6 million b/d by the end of the decade. OPEC’s monthly oil market report says that Saudi Arabian crude oil production hit a record 10.6 million b/d in June, an increase of 200,000 b/d over May.

35% of all Brazilian crude oil exports (or 5.4 million tons) went to China during the first 5 months of this year.

In June, China’s crude imports reached 7.2 million barrels per day making the country the world’s largest oil importer.  Some of these imports are going into China’s strategic reserve as the Asian nation takes advantage of low world crude oil prices and the global oil oversupply to build up its emergency stocks. One analysis suggests China has added 41 million barrels to its reserves in the first five months of the year.

Qatar, with a population of 2.3 million, now ranks second only to Russia in total natural  gas exports, generating about $86 billion last year.

The US Department of Energy has approved 9.9 billion cubic feet per day of liquified natural gas (LNG) export capacity. If all of that capacity is built, the US would be challenging Qatar for the world’s largest LNG exporter.

The technically recoverable resources of the Utica shale in the northern US are larger than previously thought, according to a study from West Virginia University.  The study found that the Utica shale contains technically recoverable resources of 782 trillion cubic feet (Tcf) of shale gas and around 1.9 billion barrels of shale oil. The geographic area underlies most of the states of New York, Pennsylvania, Ohio, and West Virginia and extends under parts of Ontario and Quebec in Canada and parts of the US states of Kentucky, Maryland, Tennessee, and Virginia. The US already has other large shale resources in the states of Texas, North Dakota and Pennsylvania.

For the first time in US history natural gas-fired electricity generation surpassed coal-fired generation. This illustrates how the shale gas boom in that country is putting mounting pressure on the country’s coal mining industry.  In April natural gas was used to generate 31%  of America’s electricity, while coal contributed 30%.

An electrical generating plant powered by wave energy has commenced operations near Perth, Australia. The Perth Wave Energy Project is the first and only operational wave power plant in the world that uses multiple wave units. The facility has a peak generating capacity of 240 kilowatts — enough to power up to 2,000 homes. The equipment consists of submerged buoys coupled to pump units affixed to the ocean floor. Waves cause the buoys to rise and fall. This motion is converted into rotatory motion at the pumps, which deliver high pressure water to a hydroelectric power station on shore.

M City, a 32-acre (13-hectare) mini-metropolis on the campus of the University of Michigan in the US, has opened to test how self-driving cars (or autonomous cars) will travel in the future. M City is hoping to replicate modern urban chaos with traffic jams and unpredictable pedestrians, and hopes to show how driverless cars can keep people and goods flowing safely and efficiently. The facility in Ann Arbor, Michigan, has 40 building facades, angled intersections, a traffic circle, a bridge, a tunnel, gravel roads and plenty of obstructed views. There’s even a four-lane highway with entrance and exit ramps. Sebastian, a robotic pedestrian, will step out into traffic to test whether the robot cars will sense him and hit the brakes to avoid running him down. Automakers like GM, Ford and Toyota, will have first access to M City as they hope to start selling autonomous vehicles 5 years from now.

 

 

with h/t Tom Whipple

 

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