Today in Energy

Aug 28, 2015

Reduced offshore share in U.S. oil and natural gas production lowers risk from hurricanes

graph of monthly U.S. crude oil and natural gas production, as explained in the article text
Source: U.S. Energy Information Administration, Petroleum Supply Monthly and Natural Gas Monthly

Offshore energy production in the Gulf of Mexico has experienced relatively minor disruptions because of tropical storms and hurricanes in recent years, and the National Oceanic and Atmospheric Administration (NOAA) has predicted a below-normal 2015 hurricane season in its updated Atlantic Hurricane Season Outlook, released on August 6.

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Aug 27, 2015

Domestic market for distributed wind turbines faces several challenges

graph of annual installed capacity of distributed wind turbines in the US, as explained in the article text
Source: U.S. Energy Information Administration, based on U.S. Department of Energy 2014 Distributed Wind Market Report

The domestic market for distributed wind turbines has weakened since the record capacity additions in 2012. Last year's installations of mid-size and small wind turbines were the lowest in a decade. Relatively low electricity prices, competition from other distributed energy sources, and relatively high permitting and other nonmaterial costs have presented challenges to the distributed wind market in the United States.

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Aug 26, 2015

EIA expects near-term decline in natural gas production in major shale regions

graph of monthly changes in natural gas production in DPR regions, as explained in the article text
Source: U.S. Energy Information Administration, Drilling Productivity Report, August 2015

Natural gas production across all major shale regions in EIA's Drilling Productivity Report (DPR) is projected to decrease for the first time in September. Production from these seven shale regions reached a high in May at 45.6 billion cubic feet per day (Bcf/d) and is expected to decline to 44.9 Bcf/d in September. In each region, production from new wells is not large enough to offset production declines from existing, legacy wells.

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Aug 25, 2015

India’s coal industry in flux as government sets ambitious coal production targets

graph of India's domestic coal consumption, production, and production targets, as explained in the article text
Source: Energy Statistics 2015, Government of India, Ministry of Statistics and Programme Implementation; Provisional Coal Statistics 2013-14, Government of India, Ministry of Coal; news reports
Note: India fiscal year is April to March. For example, FY2005 represents April 1, 2004, to March 31, 2005. Data for 2015 are preliminary.

Coal consumption in India, particularly in the electric power sector, is outpacing India's domestic production. From 2005 to 2012, India's coal production grew by only 4.7% per year to about 600 million metric tons while the country's coal-fired electric power capacity grew by a much faster rate (about 9.4% per year), reaching 150 gigawatts. To help resolve the shortfall in coal supply and to support expanded coal-fired generation, India has set a coal production target of 1.5 billion metric tons by 2020. Recent shifts in government policies and practices may play a key role in India's ability to meet this coal production goal.

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Aug 24, 2015

Growing global liquids inventories reflect lower crude oil prices

graph of global crude oil and petroleum liquids inventory change, as explained in the article text
Source: U.S. Energy Information Administration, Short-Term Energy Outlook, August 2015

Continued growth in global production of petroleum and other liquids has outpaced consumption growth since August 2014, resulting in rising global liquids stocks. Total global liquids inventories are estimated to have grown by 2.3 million barrels per day (b/d) through the first seven months of 2015, the highest level of inventory builds through July of any year since 1998. These strong inventory builds have put significant downward pressure on near-term crude oil prices: North Sea Brent crude oil spot prices have averaged $58/barrel through July of this year compared to $109/b over the same period in 2014, responding to growth in global inventories.

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Aug 21, 2015

Major fossil fuel-producing states rely heavily on severance taxes

graph of state government taxation sources, as explained in the article text
Source: U.S. Census Bureau, 2014 Annual Survey of State Government Tax Collections
Note: Data for Pennsylvania include a wellhead impact fee that was in place instead of a severance tax.

Republished August 21, 2015, 4:00 p.m. to clarify text.

Several states that produce large amounts of fossil fuels rely heavily on severance tax revenue—taxes based on the volume and/or value of oil, natural gas, coal, and other natural resources. On average, severance taxes accounted for less than 2% of state tax collections in 2014, but in three states—Alaska, North Dakota, and Wyoming—severance taxes provided a much larger share of total state tax revenue in that year. Pennsylvania, on the other hand, is considering a severance tax, and currently derives less than 1% of its revenues from a well head fee.

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Aug 20, 2015

Australia shifts investment from wind projects to other renewable sources

graph of selected countries' renewable electricity capacity, as explained in the article text

Australia's Clean Energy Finance Corporation (CEFC) last month was directed to stop investing in future wind power projects. Australian Prime Minister Tony Abbott stated that CEFC should be investing in the development of new technologies rather than in technologies that are currently established, such as large-scale wind farms.

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Aug 19, 2015

EIA lowers crude oil price forecast through 2016

graph of crude oil prices and nymex confidence intervals, as explained in the article text
Source: U.S. Energy Information Administration, Short-Term Energy Outlook, August 2015
Note: Similar confidence intervals cannot be established around the Brent futures price, as trading volumes on Brent futures contracts are relatively sparse compared to WTI trading volumes.

Amid high uncertainty in the global oil market, EIA has lowered crude oil price forecasts in the Short-Term Energy Outlook (STEO), expecting West Texas Intermediate (WTI) crude oil prices to average $49 per barrel (b) in 2015 and $54/b in 2016, $6/b and $8/b lower than forecast in last month's STEO, respectively. Concerns over the pace of economic growth in emerging markets, continuing (albeit slowing) supply growth, increases in global liquids inventories, and the possibility of increasing volumes of Iranian crude oil entering the market contributed to the changed forecast.

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Aug 18, 2015

Unplanned refinery outage leads to higher Midwest gasoline prices

graph of retail prices regular gasoline, as explained in the article text
Source: U.S. Energy Information Administration, Gasoline and Diesel Fuel Update
Note: PADD is Petroleum Administration for Defense District

On August 8, the BP refinery in Whiting, Indiana, the largest petroleum refinery in the Midwest, experienced an unplanned outage and was forced to reduce production. The BP Whiting refinery has a crude oil distillation unit (CDU) capacity of 413,500 barrels per calendar day (b/d), and it is an important source of gasoline and distillate fuel oil supply to the region.

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Aug 17, 2015

Texas electric grid serves record-high power demand

graph of daily peak electricity load in ERCOT, as explained in the article text
Source: EIA, based on Electricity Reliability Council of Texas
Note: Data for 2015 are preliminary.

During the recent heat wave in Texas, the Electricity Reliability Council of Texas (ERCOT), the operator of the electric grid covering most of the state, set a new record for electricity use when demand for electricity reached 69.8 gigawatts (GW) between 4:00 p.m. and 5:00 p.m. on August 10. ERCOT has been able to handle this extremely high demand without any system emergencies.

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