David Feldman

Three Things to Know This Week in Energy – 12/4/2017

Blog Post created by David Feldman Champion on Dec 4, 2017

1. New Senate tax bill would allow oil drilling in Alaskan wilderness.

 

As part of the Senate’s new tax bill, a refuge that has been closed since 1980 will finally be opened up for oil drilling.   The bill barely passed, mainly divided along party lines.  The vote ended at 51-49, with only one Republican voting against it.

 

Alaskan Senators seemed happy with the outcome.  Senator Murkowski, a Republican, praised the measure hours after the Senate approved its version of the GOP tax plan early Saturday. "Today's historic vote is yet another milestone in bringing us that much closer to realizing a decades-long dream of opening the 1002 area of ANWR," she said.

 

Environmentalists, on the other hand, aren’t as pleased.  Multiple environmentalist groups are calling for the reserve to remain a non-drilling zone for fear it would harm the natural habitat.

 

Senator, Dan Sullivan, sympathized with these groups but also argued in favor of developing the 1002 area saying, “we must use the best available technology, and ensure the protection of our incredible species."

 

2. OPEC and Russia agree to extend oil cuts through the end of 2018.

 

In Vienna on Thursday, OPEC and non-OPEC producers led by Russia agreed to extend oil output cuts until the end of 2018 as they continue their efforts to clear the global glut of crude oil.  However, they did leave room for an early exit from the deal if the market recovers faster than expected.

 

OPEC also agreed to cap the combined output of Nigeria and Libya at 2017 levels below 2.8 million bpd. Both countries have previously been exempt from cuts due to unrest and lower-than-normal production.

 

3. Oil prices are down, and rigs are up.

 

Oil prices are down today after U.S. shale drillers added more rigs last week, but prices didn’t plummet thanks to the OPEC meeting and agreement to extend cuts.  Drillers in the United States added two oil rigs in the week to Dec. 1, bringing the total count up to 749.  According to Baker Hughes, this is the highest rig count since September of this year.  U.S. West Texas Intermediate CLc1 was down 46 cents, or 0.8%, at $57.90 a barrel early this morning.  Brent futures LCOc1 were down 39 cents, or 0.6%, at $63.34 a barrel.

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