Latest news with #PickeringEnergyPartners
CNBC
07-07-2025
- Business
- CNBC
Watch CNBC's full interview with Pickering Energy Partners' founder Dan Pickering
CNBC's "Power Lunch" team is joined by with Dan Pickering, founder and CIO of Pickering Energy Partners, to discuss the threat of tariffs on oil and energy, the potential impact on costs and more.
CNBC
07-07-2025
- Business
- CNBC
WTI crude oil could fall into the 50s, says Pickering Energy's Dan Pickering
CNBC's "Power Lunch" team is joined by with Dan Pickering, founder and CIO of Pickering Energy Partners, to discuss the threat of tariffs on oil and energy, the potential impact on costs and more.
Yahoo
18-06-2025
- Business
- Yahoo
What the Iran/Israel conflict means for U.S. energy prices going forward
Crude oil prices, maybe surprisingly, dipped modestly on Monday after spiking at the end of last week, even as Iran and Israel continue firing missiles at each other with no easy end in sight. The U.S. oil benchmark hovered around $71 per barrel on June 16—about where it started the year—but up roughly 9% from a week prior. The current price tag is considered a relatively healthy value—profitable for most oil producers without creating particularly high fuel prices. So, even though Israel successfully targeted some of Iran's oil and gas infrastructure over the weekend, oil markets have stayed relatively calm, and Iran, which is not in a position of strength, is reportedly signaling its interest in returning to nuclear negotiations with the U.S. Why? Here are four takeaways: Israel struck Iran's South Pars gas field, the Shahran fuel depot, and the Shahr Rey oil refinery, but all of these targets are for domestic fuel and power consumption, and not global exports. That contributed to a run on fuel and potential shortages within Iran, but it has much less impact on global oil markets and Iran's roughly 1.5 million barrels per day of crude oil exports. 'Everybody is taking a hands-off approach to oil [exporting] infrastructure because it meaningfully complicates and escalates the situation,' said energy forecaster Dan Pickering, founder and chief and investment officer for Pickering Energy Partners consulting and research firm. 'Israel doesn't want to do that, and I don't think Iran does either.' On the other hand, Pickering told Fortune. 'You're one stray bomb away from a problem. If you get to a point where people stop acting rationally, things get crazy quickly.' That's why the range of outcomes is vast from $55 per barrel oil if things calm down—a low price that hurts the bottom lines of oil producers—up to $120 or so if war escalates and overall OPEC production is impacted, Pickering said. Iran sits next to the Strait of Hormuz, and the exports through that relatively narrow body of water account for about 20 million barrels daily, or one-fifth of global consumption. Impacting those flows changes everything. To be clear, oil at or above $120 per barrel is bad for almost everyone because skyrocketing fuel costs would trigger widespread demand destruction around the world. The so-called OPEC+ group increased their monthly quotas, essentially aiming to grow production by more than 2 million barrels daily by the end of the year, and undoing years of self-imposed curtailments. While the decision didn't necessarily anticipate a conflict in Iran, the OPEC's move did give President Trump more leverage in the U.S. nuclear negotiations with Iran. 'If anything in this situation could be called elegant, it is a relatively elegant set up when dealing with the risk of problems in the Middle East,' Pickering said of OPEC's moves. 'It looks like the return of production pretty closely mirrors Iran's exports, and so it was probably more geared toward a reduction of exports [through sanctions] as opposed to a conflict.' Kathleen Brooks, research director the the XTB brokerage house, highlighted how Trump wants to keep oil and fuel prices low, and that the White House could actually have a 'calming effect' on markets. 'Instead, we think that U.S. involvement could see the [Israeli] attacks on Iran narrow to nuclear sites, after Israel said that it gathered intelligence that Iran had enough uranium to make nine atomic bombs,' Brooks added. However, the math is changed with any prolonged war. 'With Israel and Iran trading attacks, oil prices have surged to multi-month highs—setting the stage for additional price hikes at gas pumps across the country,' said Patrick De Haan, head of petroleum analysis at GasBuddy. 'As long as tensions in the Middle East continue to escalate, the risk of further impacts on oil prices remains high.' De Haan projects fuel prices could rise by 10 to 20 cents per gallon moving forward. 'Motorists should prepare for what will likely be modest price increases—for now—but the situation has the potential to worsen at any moment.' Thus far, the national average price of gasoline has risen 1.1 cents per gallon in the last week, averaging $3.08 per gallon as of the morning of June 16, according to GasBuddy. However, the national average is down 9.5 cents from a month ago and 32.7 cents lower than a year ago. As Pickering said, '[Iran] is on the naughty list, but their sanctions haven't been particularly aggressively applied because the world is so focused on oil prices and the impact on inflation and economies. The developed world has decided that cheap gasoline prices are better than truly punishing bad actors.' U.S. oil drillers were showing restraint and capital discipline—and not the 'drill, baby, drill' mentality—last year even when prices were a bit higher than today. 'The volatility is dramatic, OPEC is adding supply, and it's not a given that Iran is going to reduce supply,' Pickering said. 'So, why step up and spend capital speculatively when we could wake up in a month and oil is back to $55?' So, how should everything in the Middle East be viewed from the energy perspective? 'This is a conflict that could have meaningful impacts, so people should be paying attention,' Pickering concluded. 'Right now, it looks like an inconvenience with a potentially temporary price spike. It could become much worse, so pay attention and cross your fingers it doesn't escalate.' This story was originally featured on Sign in to access your portfolio
Yahoo
04-04-2025
- Business
- Yahoo
In the reeling energy sector, an unexpected OPEC production hike plus tariff fears send oil prices plunging 7%
President Trump's sweeping tariffs combined with OPEC's unexpectedly large production hike are combining to trigger a 'double whammy' on the oil and gas sector, resulting in crude prices tumbling and fears rising of lower energy demand in an economic slowdown. The tariffs, which did exclude oil and fuel imports, are still expected to increase equipment and supply costs for energy production, construction and transportation, while potentially creating weaker global energy demand. The decision from key OPEC nations and allies, especially Saudi Arabia and Russia, to triple their expected production increase in May adds extra supplies on top of existing recession fears. The coincidentally joint announcements from the White House and OPEC caused oil prices to plunge by nearly 7% on April 3 with the U.S. benchmark for oil —front-month NYMEX WTI—hovering just above $66 per barrel, well down from the nearly $78 per barrel when Donald Trump took office in January. 'The world got more complicated, and the outlook is cloudier,' said energy forecaster Dan Pickering, founder and chief and investment officer for Pickering Energy Partners. 'It's a double whammy because you have OPEC boosting supply, which I think was dangerous to start with, but now you have this issue of tariffs being higher or worse than expected,' Pickering said. While the Trump administration is making it easier for the oil and gas industry to do business by easing environmental regulations and fast-tracking permitting, the sector is clearly somewhat 'disgruntled' with the president now, Pickering said. 'The bloom is off the rose. Now we have to see if the ease of doing business can help offset some of the pain of lower prices,' Pickering said. 'I wouldn't call the energy industry happy right now, but not completely surprised. This was a risk. Oil prices were better under Obama and Biden than they were under Bush and Trump. The Republicans make it easier to do business, but prices have been lower during their regimes.' Still, the lobbying American Petroleum Institute chose to focus instead on what Trump didn't do on energy imports. 'We welcome President Trump's decision to exclude oil and natural gas from new tariffs, underscoring the complexity of integrated global energy markets and the importance of America's role as a net energy exporter,' API said in a statement. During late Wall Street trading April 3, the stocks of Big Oil giants such as Chevron and BP were down 5.5% and 6.8% respectively, while independent U.S. oil producers fell more sharply, such as ConocoPhillips at nearly 9% and Occidental Petroleum at more than 10%. Many smaller producers, including Devon Energy and Diamondback Energy, were down 11% or more on the day. The announcement from the so-called OPEC+ group of key OPEC members plus Russia, Kazakhstan and Oman would add 411,000 barrels per day of additional crude oil to global markets starting in May at a time when supply-and-demand fundamentals were already trending weaker. Still, some of this may be overstated because Saudi Arabia and others are reacting to rising domestic power demand during the upcoming summer months in their countries, and they are not necessarily aspiring to flood the global market in an arms race, said Matt Reed, energy analyst and vice president for Foreign Reports. 'OPEC+ has its own sensible reasons for producing more sooner,' Reed said. 'Unfortunately for them, they couldn't put this decision off much longer because they need to set prices and line up sales for next month. 'It's just bad luck this decision coincided with Trump's slapdash tariff announcement.' Pickering certainly agreed on the not-so-great luck. 'The timing is terrible and now it's more terrible.' 'Forget all the tariff noise. Just on supply and demand, somebody is going to have to blink, or prices are going to $50 [per barrel],' Pickering said, citing a price point where the industry could fall below profitability and drastically reduce activity further. Already, dealmaking will come to a temporary standstill and budgets will be lowered accordingly, he said. Trump may need to impose greater sanctions on Iranian oil to help balance supply and demand, he added. 'If we don't see that, it's going to get ugly, or uglier.' OPEC may be thinking of both rising domestic demand and potential U.S. sanctions on Iranian oil in its decision, said Rystad Energy Chief Economist Claudio Galimberti. "OPEC may be preparing the groundwork," Galimberti said. "Trump is still likely to impose maximum pressure on Iran." And, while the ultimate results of the tariffs are unknown, he said, the world is now facing a new world order. 'One thing is already clear: the global trading order based on the U.S. as the consumer and borrower of last resort is ending, and the world's economic and energy system will need to adapt to a new emerging order, whose shape and form we don't yet know,' Galimberti said. This story was originally featured on Sign in to access your portfolio
Iraqi News
11-03-2025
- Business
- Iraqi News
Trump's Energy Secretary vows reversal of Biden climate policies
Houston – The US Energy Secretary vowed Monday to reset federal energy policy to favor fossil fuels and deprioritize climate change as industry leaders gathered at their biggest event since President Donald Trump returned to office. In the conference's opening session, Energy Secretary Chris Wright cited the Trump administration's moves to cut red tape delaying oil projects and promote liquefied natural gas exports (LNG) as examples of a pivot away from policies pursued under former president Joe Biden. 'The Trump administration will end the Biden administration's irrational quasi-religious policies on climate change that imposed endless sacrifices on our citizens,' Wright told a packed auditorium for the annual Cambridge Energy Research Associates (CERA) conference. Since returning to Washington less than two months ago, Trump and his team have overhauled the existing economic order at a dizzying pace, launching trade wars against allies and hollowing government agencies the president and his allies dislike. Trump made energy policy a central part of his agenda with his day-one 'Unleashing American Energy' executive order, promising during his inaugural address to 'end the Green New Deal' in favor of 'that liquid gold under our feet.' Environmentalists have criticized these shifts as leaving the world vulnerable to catastrophic climate change. Wright's 'speech made clear that he and the rest of the Trump administration are ready to sacrifice our communities and climate for the profits of the fossil fuel industry,' said Allie Rosenbluth, US campaign manager for Oil Change International, which planned a rally in downtown Houston outside the CERA event. – How much change ahead? – Energy played a key supporting role in Trump's 2024 presidential campaign, in which he pointed to higher gasoline prices as a reason more production was needed, embodied by his slogan: 'Drill, Baby, Drill.' Trump's January 20 executive order represents a potentially wide-ranging attack on tax incentives which had been embraced by energy companies to advance billions of dollars of energy transition projects. These projects were connected to laws enacted during Biden's presidency to mitigate climate change. Some pundits think Trump will stop short of actions canceling existing projects where workers have been hired, including many in conservative districts. But the abrupt shift from the climate-focused Biden to Trump likely 'turns 2025 into a paralyzed year where folks are hesitant to push on any kind of decarbonization,' said Dan Pickering of Pickering Energy Partners, a Houston advisory and investment firm. Wright described his approach as an 'all the above' stance that can include renewable energy, although he told a press conference after the address that offshore wind projects were a waste of money that are 'very unpopular' with communities. At an event last week in Louisiana, Wright touted an announcement by Venture Global of an $18 billion expansion of a liquefied natural gas export facility, highlighting Trump's reversal of a Biden freeze on permitting new LNG export capacity. Trump has ridiculed the environmental concerns at the center of Biden's policy, championing LNG exports as a way to strengthen America's ties with energy importing countries. But there has been widespread skepticism about Trump's message urging the industry to significantly boost oil and gas drilling in order to lift output and lower energy prices. Wall Street has also signaled a clear preference for robust industry profits that can continue to allow for dividends and stock buybacks. – Questions for Europe – At CERA, European officials will meet on panels to discuss Europe at a crossroads after shifting away from Russian energy supplies. In the aftermath of Russia's invasion of Ukraine, US LNG 'played a super important role' for Europe as the continent sought to lessen its dependence on Russian gas, said Jonathan Elkind, a fellow at the Center on Global Energy Policy at Columbia University. However, Trump's realignment with Russian President Vladimir Putin has forced European leaders to reckon with the system's long-term viability. For the near future, including at CERA, Elkind expects European officials to continue to speak optimistically of the prospects for more US LNG. But 'at the back of their mind… it's pretty hard to tell whether Donald Trump is friend or foe and that's a shocking thing to say after 70 years of a close alliance,' Elkind said.
