Shell, oil prices, drilling, #txlege and budgeting

First, it looks like my poll for the quarter ending today was way wrong, though no more wrong than paid oil analysts, on average. Averaging votes, you and I said oil would be around $58-59 a barrel at the end of the month. And, we were off by, oh, only about $15 a barrel, per the latest numbers from Oil-Price.net.

Meanwhile, that same slump has caused Shell to pull back from Arctic drilling. Shed no tears, though; the oil giant will be back when oil gets above ... $70 a barrel, venturing on them holding on for a little while before premature withdrawal.

It's also caused greed machine Chesapeake to finally face the need for layoffs.

As for what's ahead for the coming quarter? Your guess is as good as mine, so I'll have a new poll up for those guesses. Let's just say that price points will be about $5 lower.

Meanwhile, our state's urban Jethro Controller, Glenn Hegar, is probably still masturbating his rosy scenario on the Texas budget, even as the falloff could be staggering — 13 percent in the Eagle Ford, 7 percent in the Permian. That much less drilling means fewer double cab pickups sold; fewer new houses bought; fewer remodelings; fewer fancy restaurant dinners; etc., etc. And, all of that means fewer sales tax dollars for Hegar's state treasury. Since the state has lost nearly 30,000 oil jobs this year, this continued slump in sales taxes is not an unrealistic scenario.

As for when things will pick up? Chris Tomlinson refers to U.S. oilmen who say the price needs not to get above $60, but above $70, or higher yet, for major investment in the American oil patch to pick up again. Per his piece, if $80 is really the threshold, that means waiting until the next decade.

Is our urban Jethro listening?

Further #oilprices slippage may be ahead — and is Shell the new BP?

The International Energy Association is following on the thoughts I expressed in a blog post earlier this week and saying that oil could slump more before it has a longer-term rebound.

I personally don't expect oil prices to drop below $50/bbl (that's for West Texas Intermediate) for an extended period of time, but I do expect them to stay closer to there than to $65 for the rest of this third quarter, at least.

Meanwhile, Chris Tomlinson of the Houston Chronicle salutes Shell for warning that climate change is real. I advised him to take that with a grain of salt. I said that grain of salt is about 6 years old, and its name is British Petroleum. I mean, Beyond Petroleum. I mean BP.

You get the idea.

Reading between BP's escrow lines

That $20 billion escrow account? It won't be topped off until the end of 2013.

BP could be bankrupt by then. Or bought by ExxonMobil or Shell. All of which would render the account's topping off as kind of nugatory.

ExxonMobilBP?

That's a scary thought. But, some investors and oil analysts are saying that BP may lose so much market value over Deepwater Horizon that either ExxonMobil or Royal Dutch Shell considers making a play for it.

ExxonMobilBP?

That's a scary thought. But, some investors and oil analysts are saying that BP may lose so much market value over Deepwater Horizon that either ExxonMobil or Royal Dutch Shell considers making a play for it.

Shell settes Nigeria civil rights suit – justice delayed, but justice

True, the $15.5 million settlement amount is a pittance, and Shell continues to deny any responsibility for the 1995 death of Nigerian activist Ken Saro-Wiwa. Add to it this malarkey:

In a statement, the company said the agreement “will provide funding for the trust and a compassionate payment to the plaintiffs and the estates they represent in recognition of the tragic turn of events in Ogoni land, even though Shell had no part in the violence that took place.”

“Shell has always maintained the allegations were false,” Malcolm Brinded, the company’s executive director for exploration and production, said in the statement.

Nonetheless, the result shows the Alien Tort Claims Act may just have some teeth. And, Shell agreed to release the dollar amount of the settlement, an idea it long resisted.

And that will have ramifications for the other major players of Big Oil in places like Ecuador and Indonesia.

So, justice delayed and partial still has the leverage of justice for tomorrow, too.

Court says no to Shell in Alaska

Fortunately, Shrub Bush’s last –minute environmental shenanigans can’t extend to the Ninth Circuit Court of Appeals, which put the kibosh on Shell’s plans for offshore drilling north of Alaska.

In a 2-1 ruling, the court said the Minerals Management Service, the federal agency in charge of offshore leasing, violated the National Environmental Policy Act by not taking a deep enough look at the impact offshore drilling would have on bowhead whales in the Beaufort Sea and Native Alaska communities on the North Slope.