By JOHN P. TRETBAR
Kansas Common crude at CHS in McPherson dropped another half dollar on Friday and to end the month at $26 a barrel. That's four dollars less than a week ago, and twenty dollars less than a year ago. The average price for the month of October was $29.69 a barrel, compared to $29.84 in September and over $47 in October of 2019.
Volatility on the futures markets sent prices for West Texas Intermediate crude up and down Monday following a ten-percent weekly drop last week, the biggest since April. Prices on Friday fell to their lowest levels in five months. By midday, Monday the near-month Nymex contract was up 39 cents to $36.18 per barrel. London Brent gained 41 cents at $38.35.
U.S. crude production rebounded last week to reach its highest level since the end of July. Weekly production dropped below 10 million barrels two weeks ago, but last week topped 11 million, an increase of more than 1.2 million barrels per day.
The Energy Information Administration reports U.S. crude-oil inventories increased more than four million barrels last week. Stockpiles are now about nine percent above the five-year seasonal average.
The government reports weekly crude imports to the United States were up half a million barrels last week to 5.7 million barrels per day. The four-week average is 13% below the same period last year.
The Kansas Corporation Commission reported a slight increase in the number of intent-to-drill notices filed across the state. October's tally of 75 intents is the highest since December. That's 468 so far this year, a little over one-fourth of the total through October of last year. There are five new intent-notices in Barton County, one in Ellis County and two in Stafford County.
Independent Oil & Gas Service reports seven active drilling rigs in eastern Kansas, which is up two for the week, and nine west of Wichita, which is down one. Drillers reached total depth on a well in Ellis County last week, and will soon spud a new well in Stafford County.
Baker Hughes reported a total national rig count of 296, noting an increase of ten oil rigs, eight of them in Texas and two in New Mexico.
A dry hole in Stafford County was among ten newly-completed wells in Kansas last week, four in eastern Kansas and six west of Wichita. Independent Oil & Gas Service says there are 704 new completions so far this year compared to more than 1,000 up to this point last year.
Kansas regulators approved permits for drilling at 28 new locations last week, 19 east of Wichita, nine of them in the western half of the state, including one in Ellis County. So far this year there are 386 new drilling permits across the state, down from nearly 15-hundred a year ago.
The government says gasoline demand has dropped to its lowest level since mid-June, and Triple-A says that's good news for motorists. The national average pump price drops to $2.14 [["two fourteen"]] a gallon. Kansas prices are down a cent and a half from a week ago, four cents from a month ago and forty cents from a year ago. We spotted $1.89 at several outlets in Hays, while prices remained at $1.99 across Great Bend. You'll says more than five dollars on your 15-gallon fill-up compared to a year ago.
Oil-by-rail traffic in the U.S. is down nearly 22% from a year ago. The Association of American Railroads reports 10,169 tanker cars hauling petroleum for the week ending October 24, down nearly 10,000 cars from the week before. Canada's oil-by-rail traffic is down more than 28% year over year.
Exxon Mobil Corp. will slash its global workforce by 15% over the next two years. Bloomberg reports the cuts will include 1,900 U.S. jobs, mostly in Houston, as well as an undisclosed number of positions around the world, up to a total of about 14,000 people. The world's four largest oil companies have announced plans to cut nearly 40,000 jobs between them in response to the demand slump brought on by the pandemic.
Canada's Suncor Energy is hoping to sell several of its oil and gas fields in the North Sea. Bloomberg says the company could reap half a billion dollars in the planned sales. After a slow start to the year as the coronavirus crisis disrupted plans across the industry, asset-sale activity in the North Sea has picked up in the second half.
Reuters reports that struggling oil and gas companies in the Canadian province of Alberta will get a three-year break on municipal property taxes for land where they are drilling wells or building pipelines. The provincial government last week said it would also lower property tax assessments on less-productive wells and eliminate a provincial tax on drills.