Sable Offshore has been directed by the Trump Administration to restore operations off the Santa Barbara coast and reopen the Santa Ynez pipeline system. Asking people smarter than me (especially Professor Shellman) their opinion on if this is a wise move or not. I think it could be IF it is used to keep our emergency stockpile filled, but I am just a lowly peon in this area.
Mike
This week the STEO issued its updated US March production forecast out to December 2027. When compared with the February issue, they have upwardly revised December 2027 production by 633 kb/d and production reaches a new high in early 2027. In comparison, the February report was showing production falling steadily from October 2025 to December 2027, 13,864 kb/d to 13,211 kb/d.
I was stunned by the change. I wondered what could have changed over one month. WTI was up but the STEO was showing the same price for WTI in December 2027 as December 2025.
I found this article below which says the Permian needs more gas pipelines before oil production can increase. Maybe the March STEO knows that new gas pipelines will be operational in the Permian later this year.
This is a quote: "Analysts have long said negative prices, which force some energy firms to pay others…
Ovi - Baker Hughes came out yesterday with a reading of 401 (-1).
It would seem that the oil industry has not yet gotten excited about the oil futures curve. Yes, I believe that an invisible hand is at work, whihc pairs with Mike's post the other day. The Biden admin hated oil viscerally (but dumped the SPR in 2022 for political reasons). Trump hates higher oil prices viscerally and makes no bones about wanting oil to be $50/bbl or less.
I'm as certain as I can be that oil prices in the US are being politically manipulated. Sadly, this will just lead us into the mother of all oil shocks.
It can't be done with any degree of accuracy; its not a one-off event in the life cycle of a tight oil well located in an over-drilled sweet spot. We can see that in the rate of well productivity decline for new wells, in accelerating terminal decline rates for older wells and increasing water to oil ratios in all wells.
Above is a Novi Cumulative Oil vs. Time chart for all 2016-July 2025 Permian wells, all benches, normalized for lateral lengths.
2023 wells at month 19 have a cumprod. that is 3% lower than the average for the data set. 2024 wells are a course to be lower, and 2025 wells even lower. Can I be any clearer on this?
Pressure depletion is significant enough now in the Midland Basin that predicting EURs is fruitless. Same with Bone Springs wells in Lea County, for instance in EOG's over-drilled, horizontally and…
Mike,
That chart showing the two Exxon Mobil three-mile laterals looks absolutely horrible. Are you seeing the same results in other 3-mile laterals?
steve