By JOHN P. TRETBAR
The Kansas Independent Oil and Gas Association (KIOGA) has canceled its annual convention in response to uncertainty about the response to the coronavirus pandemic. The group is reviewing other plans including a series of internet seminars to replace the events originally scheduled for the August gathering. An online conversation with the Kansas Congressional delegation is planned next month. The popular golf and sporting clays tourneys could be rescheduled as early as October.
Friday's prices at CHS in McPherson were up a quarter. Kansas Common crude starts the week at $31.50 a barrel. That's 75 cents higher than a week ago, a dollar-fifty higher than at the first of the month but nearly $15 cheaper than last year at this time.
Kansas gasoline prices held steady. The Sunflower State remained one of just 12 states with average gas prices below two dollars a gallon. The average Thursday across Kansas last week was $1.979. That's a nickel more than last month at this time, and about 55 cents less than a year ago. AAA said the average across the U.S. was about $2.19 a gallon.
Independent Oil & Gas Service reports the Kansas rig count rose last week, but so did the number of inactive drilling rigs. There are two active oil and gas drilling rigs in eastern Kansas, up one from last week, and five west of Wichita, which is up two. There are 26 idle rigs statewide, compared to just 20 last week. There's not a lot of drilling activity in our area. Operators reached total depth at leases in Russell and Stafford counties.
Baker Hughes reports the national rig count was 251 on Friday, an increase of one oil rig but a drop of three rigs looking for natural gas. The count in Texas was down one, while New Mexico was up one.
Kansas regulators approved five permits for drilling at new locations for the week ending July 23, all of them in Western Kansas. That's 245 new permits so far this year compared to 550 by this point last year.
There were just eight wells completed last week across the state, four of them were east of Wichita and four in western Kansas, including one completion in Russell County. Operators across the state report 564 completed wells so far this year, well behind the 823 wells completed by late July of 2019.
The government reports a slight uptick in U.S. crude-oil production last week, to 11.06 million barrels per day. The Energy Information Administration says U.S. crude-oil stockpiles increased by nearly five million barrels last week. Inventories are about 19% higher than the five-year average for this time of year. U.S. crude oil imports averaged 5.9 million barrels per day, an increase of 373,000 barrels per day from the previous week. Over the past four weeks, crude oil imports averaged 13.5% less than the same four-week period last year.
The Governor of Colorado says he has negotiated a truce in that state's oil and gas "ballot wars." Governor Jared Polis is hoping to let Colorado's new oil and gas law work its way through the regulatory process. In an opinion article published Monday, Governor Polis said an industry-backed group called Protect Colorado will end its efforts to put two pro-industry measures on the ballot this year. Three other measures, relating to new setback rules, local moratoriums and state oversight, won't make this year's ballot either, but supporters say that's more about the difficulty gathering signatures than any deal with the Governor. And some prominent environmental groups in the state still plan to consider a new batch of ballot measures in 2022.
Texas regulators say the Saudi-Russia oil price war spilled over into the U.S. economy in the form of what they call excessive dumping of crude oil into U.S. markets. The Railroad Commission of Texas, the state's top oil regulator, says after the pandemic hit Saudi shipments to the U.S. reached roughly four times February's volume, the highest total since 2014. The Commission and other groups are urging a federal investigation.
U.S. Oil-by-rail is up for the week but down nearly 15% compared to a year ago. The year-to-date total is down about 12% compared to the same figure a year ago. The Association of American Railroads says total rail traffic is also improving week-to-week, up about seven percent, but still lags behind last year by eight-and-a-half percent.
China’s crude oil imports from Saudi Arabia rose 15% in June compared to a year ago. Chinese refiners ordered record volumes in March and April when oil prices tumbled. China's crude imports from all its main suppliers set new records in June, boosting the country's total crude imports to a new record high, nearly 13 million barrels per day.