Brian explained, “The incentive to store in today’s contango market is strong, so if we continue at the pace of 2.2mnbbl/week build, we would reach 80 percent capacity in Mid-April.”
Boston, MA (PRWEB) February 17, 2015
Genscape’s February 11th webinar, featuring Brian Busch (Genscape), Rusty Braziel (RBN Energy), and Dominick Chirichella (Energy Management Institute), covered some of the most relevant and pressing questions facing today’s oil market participants. The webinar kicked off with a macroeconomic view of the state of the global oil market. Dominick discussed the evolving status of OPEC as it faces challenges from the U.S. shale revolution. Currently, oil prices are below the breakeven point for all OPEC member nations, yet they show no signs of changing tactics which will continue to push prices lower.
Rusty Braziel delivered a compelling scenario analysis of U.S. natural gas and oil production in a growth, cutback, and contraction environment. In a perfect world where demand responds to the low prices, Rusty predicted that we could see WTI prices return to the $80/bbl range by 2017. On the other hand, if resilient production keeps volumes growing but demand does not respond, we could see WTI prices trading in the $50-$60/bbl range through 2020. With producers pulling back on drilling and focusing their existing rigs on their highest yield ‘sweet spots’ we will see enough resiliency and efficiency to avoid harsh impacts on production growth.
Cushing, Oklahoma is the world’s largest storage hub. Brian Busch provided a historical view of storage at Cushing, explaining that capacity utilization has not surpassed 80 percent since Genscape began monitoring in 2009. Today, there are about 86mnbbls of capacity at Cushing, and half of that has been filled. Brian explained, “The incentive to store in today’s contango market is strong, so if we continue at the pace of 2.2mnbbl/week build, we would reach 80 percent capacity in Mid-April.” However, since many of those with access to storage have already used it, they will be dropping out of the storage play for the most part.
The speakers went into much more detail and fielded questions from the audience. To watch a recording of the complete webinar and download a copy of the slides, visit http://info.genscape.com/cushing-storage-oil-market-impact-2015-on-demand-webinar-pr.
Genscape's Cushing Crude Oil Storage Report is the industry standard for the most important crude oil trading hub in the world. Bi-weekly storage estimates are based on actual tank volumes and include granularity down to the individual tank level, collected using Genscape's proprietary technologies. Subscribers gain exceptional transparency with highly accurate, advanced notice of actual storage levels at Cushing, OK and other oil storage facilities around the world. To learn more or request a free trial, visit http://info.genscape.com/cushing-storage-pr.
Genscape is the leading global provider of real-time data and intelligence for commodity and energy markets, driven to improve market transparency and efficiency. With thousands of patented monitors strategically deployed worldwide, Genscape is unique in its ability to collect and report proprietary market fundamentals in real-time or near real-time. Genscape delivers innovative solutions across a number of asset classes including: Oil, Power, Natural Gas and LNG, Agriculture, Petrochemical and NGLs, Maritime, and Renewables. Genscape clients often gain important insight not available elsewhere, improve risk management, or increase operational efficiency. For more information, please visit: http://www.genscape.com