By JOHN P. TRETBAR
The near-month Nymex contract for light sweet crude dropped by more than a dollar per barrel on Friday to settle a few cents shy of $80 per barrel. In morning trading Monday, WTI prices were up a dollar and change, with the Nymex benchmark contract trading over $81 and London Brent over $86 per barrel.
Kansas prices dropped a dollar and a quarter per barrel to close out last week. Kansas Common crude at CHS in McPherson starts this week at $70.25 per barrel. November prices dropped by a little over two-fifty per barrel to a monthly average of $74.43 per barrel. That's a little over six dollars higher than prices in November of last year.
The Energy Information Administration reported U.S. crude oil production reached 368 million barrels in September, an increase of 12 percent over September of last year. Kansas production was down 153,000 barrels from the month before at 2,363,000 barrels, or about 79,000 barrels per day. Output in Texas was over 154 million barrels or about 42% of the national tally.
U.S. crude production dipped slightly last week, but remained above 12 million barrels per day for a fourth straight week. EIA says output is nearly 600,000 barrels per day ahead of last year at this time. Domestic crude imports averaged six million barrels per day, down by a million barrels per day from the week before.
The Energy Information Administration reported crude stockpiles dropping to just over 419 million barrels as of Nov. 25. That's down 12.6 million barrels from the week before, or roughly eight percent below the five-year average for this time of year.
State regulators report 154 new intent-to-drill notices across Kansas during the month of November, up 39 intents from the month before and 21 intent-notices ahead of last November. The year-to-date tally is 1,611, an increase of 451 intents over a year ago. We spotted three new intents in Barton County, six in Ellis County, one in Russell County and two in Stafford County.
Kansas rig counts are slightly lower than last week. Independent Oil & Gas Service reports 21 active drilling rigs east of Wichita, which is down two for the week, and 29 in Western Kansas, which is unchanged. Drilling was underway Thursday on one lease in Stafford County. Operators were about to spud new wells in Ellis and Stafford counties Friday. Kansas operators competed 12 new wells last week. All 12 were west of Wichita, including one in Ellis County. Kansas regulators last week okayed four new drilling permits in the eastern half of the state and nine west of Wichita, including one in Ellis County. There are 1,522 new drilling locations permitted so far this year.
US oil-by-rail traffic dropped by more than three percent year-over-year. The Association of American Railroads reports 8,665 tanker carloads during the week through November 26, down 1,710 carloads from the week before. Canadian traffic dropped slightly from the week before but remains slightly higher than a year ago.
The Biden Administration will open up nearly a million acres off the coast of Alaska for energy exploration, despite a demonstrated lack of interest when the acreage was first offered earlier this year. This sale was included in the Democrats’ Inflation Reduction Act, in order to secure the vote of holdout Senator Joe Manchin.
The United Arab Emirates are playing on both sides of the free-energy fence. The UAE will dramatically increase energy exports, while at the same time pursuing a net-zero emissions policy throughout the kingdom. That's according to an announcement last week from the kingdom's president who doubles as the chief executive of the state-run oil company.
The government announced a huge new oil export facility, and many are questioning the timing. The Biden Administration waited until after the UN climate conference wrapped up in Egypt before revealing its approval of what will be our largest oil-export terminal. The Sea Port Oil Terminal off the Gulf Coast of Texas would add two million barrels per day to U.S. export capacity.