Petroleum imports, which leveled off during the Middle East
crisis, are rising again as we see a decline in U.S. drilling
The U.S. rig count last week was 31 percent behind the 1990
level. In Oklahoma, it was down 35 percent from year-ago levels.
For October, petroleum imports were 9.4 percent higher than
imports in October 1990. As a percentage of consumption, imports
accounted for 42.5 percent, compared with only 39.7 percent in
There are numerous contributing factors to why the domestic rig
count is depressed: general uncertainty in the oil and gas
industry, severely low natural gas prices and the like. Too,
consider that drilling costs are on the rise and earnings this year
are down for major oil companies despite higher oil prices.
Drilling costs per well for 1990, according to the American
Petroleum Institute, were 6 percent above 1989 levels. Average
cost-per-foot drilling rose 3.5 percent.
Earnings from upstream domestic operations among 20 leading
U.S. oil companies, as surveyed by API, show a 29.3 percent
decline, while earnings from worldwide upstream operations fell
only 15.3 percent for the first nine months of 1991.
Earnings from downstream domestic operations dropped 3.3
percent, while earnings from downstream worldwide operations rose
38.1 percent, the trade group reported.
That could be a reflection of more intense operations abroad
rather than in the United States, a trend that is continuing.
In conjunction with the rise in petroleum imports, demand is
beginning to rise after a flat period this year because of the
Persian Gulf War and general economic woes. Demand, however, was
not rising at as fast a pace as imports.
Demand for petroleum products in October rose only 2 percent,
compared with the almost 10 percent rise in imports.
Domestic crude oil production in October, according to the U.S.
Department of Energy, also declined 2 percent compared with
Natural gas production was flat for the month. . .
William Scherman, general counsel for the Federal Energy
Regulatory Commission, will be in Oklahoma City on Friday to
discuss the pending "mega-NOPR" (notice of proposed rule making),
courtesy of the Oklahoma Independent Petroleum Association.
The luncheon will be at noon in the Hilton Inn Northwest. For
reservations, contact Mickey Thompson, executive vice president of
Scherman has been with FERC since 1987. He will be talking
about the impact of the mega-NOPR on Oklahoma independent gas
producers. The rule-making deals with natural gas sales and
transportation issues and is expected to cause some upheaval in the
industry. . .
A course titled "Gas Processing for Engineers" will be offered
next month through the University of Oklahoma Continuing Education
and Public Service office. …