In what could be the largest natural gas discovery in history, Italian energy company Eni says it has unearthed a “supergiant” gas field in the Mediterranean Sea off the coast of Egypt covering about 40 square miles.  The field could hold a potential of 30 trillion cubic feet of natural gas or the energy equivalent of about 5.5 billion barrels of crude oil. The company won’t know the field’s true size until it begins to develop it. Eni estimates that this resource will be able to satisfy Egypt’s natural gas demand for “decades.”

Vitol, the world’s largest independent oil trader, expects that crude oil prices will stay between $40 and $60 a barrel next year. Some analysts still believe that prices will reach $30 in the next year.

US gasoline prices are at their lowest level since 2004 and its residents are driving the most miles on record.

Venezuela wants an emergency meeting of OPEC in coordination with Russia to cut crude oil production and raise oil prices. This essentially means that the Gulf Arabs and Iraq should cut production to enable the weaker OPEC members to benefit from higher prices. OPEC is not scheduled to meet again until December 4th and has rebuffed similar requests before.

Iran reiterated that it is determined to regain its rightful share of the world’s oil markets no matter what the price of oil is next year.

The global oil product market could experience a surplus of gasoline (petrol) supply as early as 2017, according to a long-term oil product market forecast from energy consult Wood Mackenzie Ltd.

Off of Norway, the Edvard Grieg field was discovered in 2007. Sweden’s Lundin Petroleum says first production from the field is expected later this year. Peak production is anticipated at 90,000 barrels of crude oil and 53 million cubic feet of natural gas per day. A recent well drilled in the field now leads Norway’s oil regulator to increase its estimate of recoverable crude oil by between 6 and 50 million barrels.

UK firm Oil and Gas Ltd. said some 10 to 11 billion barrels of shale oil is located in a 55 square-mile area of that country’s Horse Hill basin. The company expects to be able to extract up to 15% of the oil in place.

The Kenyan Energy Ministry said Kenya has begun talks with neighboring Uganda on the financing and construction of a crude oil pipeline that will link the two African countries and carry crude oil produced by companies including Tullow Oil.

Given the weak oil market, international oil firms are continuing to cut costs.  Last week French oil company Total said it will sell a gas pipeline and gas terminal in the North Sea to North Sea Midstream Partners for $905 million as it battles against the oil price collapse.  Meanwhile, offshore rig company Transocean said it plans to cancel issuing stock dividends to investors and will record $2.1 billion in impairments because of the weak oil market.

OPEC member Kuwait said the global plunge in crude oil prices and financial markets heightens the need for the country to  diversify its revenue sources.

In China, the country’s biggest offshore oil and gas explorer Cnooc Ltd. posted a 56% decline in profit for the first half of this year.

In May, the US produced 7.47 quadrillion BTUs of energy. The country supplied 7.36 quadrillion BTUs. That month fossil fuels  accounted for 78.6% of all energy production while renewables produced 11% and nuclear produced 9%.


with h/t Tom Whipple


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