- Crude oil prices fell sharply after the Energy Information Administration (EIA) reported a 9.3-million increase in crude oil inventories for the week ending Oct. 11. The EIA said that at 434.9 million barrels, crude oil inventories were 2% above the five-year average for the season. At press time, Brent crude traded at $59.17 a barrel, with West Texas Intermediate changing hands at $53.23 a barrel. Both benchmarks were down from the previous day’s close, which marked the third straight day of losses.
- A proposed Southern Red Sands frac sand mine has stirred tensions and spurred questions in Kanab, Ariz., since the city council voted in July to provide water to the project. The mine’s opponents say local officials did not fully evaluate the mine’s potential impact on the area’s water, air and traffic. They also argue that the mine, which would produce at least 700,000 tons of sand per year, could threaten the city’s aquifer and an animal sanctuary that is the city’s largest employer. The company’s chief executive, Chad Staheli, said his company is complying with all regulations.
- According to Julian Lee, writing for Bloomberg, a third shale boom may be coming over the horizon. This third boom will be driven by the international oil majors and will be characterized by a focus on better extraction, rather than rapid output growth. The application of enhanced oil recovery techniques, consolidation of ownership, automation of drilling, and rationalizing of supply chains will increase the volume of oil extracted over the lifetime of a well and reduce costs. But it won’t deliver the same pace of growth as seen recently.