Good morning, here's what the Oilman has for you today:

• Oil, Bank Execs Dub Carbon Capture “Delusion”

• Vitol Sees Balanced Oil Market in 2024

• Upcoming Oil and Gas Events

• Tweet of the Day

Oil, Bank Execs Dub Carbon Capture “Delusion”

If oil companies plan to use carbon capture as a tool for expanding production, they’re delusional.

The conclusion comes from a group dubbed the Energy Transitions Commission.

It’s made up of executives from the very same oil industry, bankers, and academics.

The carbon capture conundrum

Capturing CO2 emissions and storing or reusing them is a controversial topic.

Greens hate it because, they say, it will only embolden oil and gas producers to produce more oil and gas.

Regardless of lower emissions, this seems to be unacceptable. Weird, right?

The energy industry likes it because it does remove emissions, but it’s not exactly cheap.

And yes, some have seen it as a tool for justifying more production.

Per the Energy Transitions Commission, carbon capture has a “vital but limited” role in the transition.

First, there’s the cost issue.

Second, there is the green opposition.

Third, there’s not a lot of funding for carbon capture projects available.

Carbon capture remains complicated.

So, is the transition even about emissions?

Carbon capture is a way to keep producing oil and gas—an expensive way—while lowering emissions.

But environmentalist NGOs are against it.

So, are they against emission reduction?

Or are they against oil and gas as such, and emissions don’t really matter?

It’s increasingly looking like the latter.

Even Oxy’s ambitions in direct air capture, which is basically sucking CO3 out of the air, haven’t softened the greens.

They want oil and gas gone, period, come what may.

They call it a transition, but what it would actually be is a catastrophe.

But sure, keep talking about the emissions you want to reduce.

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Vitol Sees Balanced Oil Market in 2024

Supply growth exceeding expectations and stable demand will keep the oil market balanced in 2024.

That’s according to Vitol’s head of research, Giovanni Serio.

Serio also said at an industry event this week that demand for oil has topped 2019 levels.

That was the same year BP said demand for oil had peaked.

Where there’s demand, there will be supply

The peak oil demand scenario failed spectacularly.

There has even been a threat of a shortage this year as Saudi Arabia cut production to push prices higher.

But other producers, notably the U.S., have been ramping up.

Even at a slower pace, this ramp-up could ensure a market balance in 2024.

Provided demand growth doesn’t surprise, yet again.

This year, it has been stronger than expected.

What a shocker.

Non-OPEC production growth has also surprised, according to Vitol’s head of research.

It looks like 2023 was a year full of surprises in the oil space.

What will 2024 bring?

Probably more surprises for those expecting weaker demand growth.

Per Vitol, oil intensity is up in most of the world except the U.S.

That’s the amount of oil used per unit of GDP.

Higher oil intensity means most economies have returned to growth.

And there’s no reason to expect this will somehow sharply reverse in 2024.

Supply will be more interesting to watch.

Saudi has zero motivation to end its cuts.

So does Russia, although its cuts are a lot more modest.

But Amos Hochstein just said the U.S. would level more sanctions on Iran’s oil…

While trying to keep prices low, by the way.

A totally workable scenario.

Supply, then, will likely remain constrained but growing. Slowly.

Upcoming Oil & Gas Events

• November 28: TIPRO/IPAA Leaders in Industry Luncheon, Petroleum Club of Houston, Houston, TX

• November 28: NDPC Christmas Gala, Lumen Vitae University Center, Bismarck, N.D.

• November 28-29: UTA Oil and Gas Conference, Hilton Americas, Houston, TX

• November 29: DUG Appalachia Conference & Exhibition, David L. Lawrence Convention Center, Pittsburgh, PA

• November 30: IPAA Texas Hold’Em Tournament, The Post Oak Hotel, Houston, TX

Around the Global Patch

🇸🇦 Saudi oil exports rebound in September.
🇨🇳 Sinopec triumphs: Asia's deepest well producing.
🇳🇴 Norwegian offshore floatel supplier reports loss.

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