From:

Subject:
Date:
To:

Douglas Grandt answerthecall@me.com

The price of oil continues to tumble
December 8, 2015 at 1:19 PM
Edward Hild (Sen. Murkowski) Edward_Hild@murkowski.senate.gov, David Cleary (Sen. Alexander)
David_Cleary@alexander.senate.gov, Dan Kunsman (Sen. Barrasso) Dan_Kunsman@barrasso.senate.gov,
Joel Brubaker (Sen. Capito) Joel_Brubaker@capito.senate.gov, James Quinn (Sen. Cassidy) James_Quinn@cassidy.senate.gov,
Jason Thielman (Sen. Daines) Jason_Thielman@daines.senate.gov, Chandler Morse (Sen. Flake)
Chandler_Morse@flake.senate.gov, Chris Hansen (Sen. Gardner) Chris_Hansen@gardner.senate.gov,
Ryan Bernstein (Sen. Hoeven) Ryan_Bernstein@hoeven.senate.gov, Boyd Matheson (Sen. Lee) Boyd_Matheson@lee.senate.gov
, Mark Isakowitz (Sen. Portman) Mark_Isakowitz@portman.senate.gov, John Sandy (Sen. Risch) John_Sandy@risch.senate.gov,
Travis Lumpkin (Sen. Cantwell) Travis_Lumpkin@cantwell.senate.gov, Jeff Lomonaco (Sen. Franken)
Jeff_Lomonaco@franken.senate.gov, Joe Britton (Sen. Heinrich) Joe_Britton@heinrich.senate.gov, Betsy Lin (Sen. Hirono)
Betsy_Lin@hirono.senate.gov, Patrick Hayes (Sen. Manchin) Patrick_Hayes@manchin.senate.gov,
Bill Sweeney (Sen. Stabenow) Bill_Sweeney@stabenow.senate.gov, Mindy Myers (Sen. Warren)
Mindy_Myers@warren.senate.gov, Jeff Michels (Sen. Wyden) Jeff_Michels@wyden.senate.gov,
Michaeleen Crowell (Sen. Sanders) Michaeleen_Crowell@sanders.senate.gov, Kay Rand (Sen. King) Kay_Rand@king.senate.gov
, Joe Hack (Sen. Fischer) Joe_Hack@fischer.senate.gov, Derrick Morgan (Sen. Sasse) Derrick_Morgan@sasse.senate.gov,
Karen Billups (Senate ENR Ctee) Karen_Billups@energy.senate.gov, Angela Becker-Dippmann (Senate ENR Ctee)
Angela_Becker-Dippmann@energy.senate.gov
Cc: Jordan Cox (Sen. Fischer) Jordan_Cox@fischer.senate.gov, Ginger Willson (Sen. Sasse) Ginger_Willson@sasse.senate.gov

Dear Chiefs of Staff of the Senate Energy & Natural Resources Committee (ENR) and the Nebraska Senate Delegation,
.
You produced two bills that do not consider the likelihood of the petroleum industry's demise at the hand of the Saudis:
Bit.ly/S_2011_Offshore_Production_and_Energizing_National_Security_Act_of_2015_OPENS
Bit.ly/S_2012_The_Energy_Policy_Modernization_Act_EPMA
Todays real time news feed is just too much to fathom it appears than there is a panic in the making, thanks to the price war:
Commodity crunch: Brent crude oil plunges through $40 live updates - Bit.ly/Guard8Dec15
The Senate Energy and Natural Resources Committee members should be leading Congress toward responsible legislation that
would avert the calamity that is evolving because the U.S. petroleum industry has over-produced newly exploited shale oil and
gas production technologies. In its greed and exuberance, the petroleum industry has shot itself in the foot, destroying jobs and
businesses in the process of creating an historic glut of crude and gas.
Please call petroleum CEOs to testify how they intend to behave as their fiduciary duty guides them to make decisions that
conflict with National Interest and Public Interest. We dont want them suddenly going out of business due to low profitability or
declining share values. We need to keep an uninterrupted flow of fuels even as their profits wane. In order to keep the flow of
fuels flowing, we must demand that the industry diversify and replace fossil fuels with new energy technologies and rid ourselves
from being held hostage to Saudi and other OPEC petroleum resources
Doug Grandt

Oil price hits fresh post 2009 lows as glut grows

LONDON | By Dmitry Zhdannikov and Simon Falush | Tue Dec 8, 2015 9:59am EST | Bit.ly/Reuters8Dec15
Oil prices resumed their slide on Tuesday, with U.S. crude falling below $37 per barrel and Brent below $40 for the first time since
early 2009, amid fears the world was running out of storage capacity as a global glut intensifies.
The global oversupply is being compounded by OPEC's failure last week to agree a production ceiling, with members Iran and
Iraq promising to ramp up output and exports next year.
Benchmark Brent and WTI futures both fell more than 6 percent on Monday, and on Tuesday they hit fresh lows last seen during
the credit crunch of 2008/09.
Brent futures LCOc1 were down 23 cents at $40.50 a barrel by 1450 GMT. U.S. crude CLc1 was trading at $37.44 a barrel, down
11 cents from its last settlement.
"The lower levels are largely the result of a renewed focus on fundamentals now that the bulls hope for an OPEC cut is off the
table," JBC Energy said in a note.
The failure to agree production levels means OPEC core members are readying for new battles for share in a market already

The failure to agree production levels means OPEC core members are readying for new battles for share in a market already
heavily oversupplied and consuming almost 2 million barrels per day less than it is producing.
"OPEC has lost control of the oil market and unless something fundamental changes that causes demand to overtake the
oversupply in the market, the path of least resistance is the 2008 lows of $35-$38," said Michael Hewson, chief market analyst at
CMC Markets.
If Brent falls below $36 per barrel, it would reach levels last seen in 2004 at the start of the so-called commodities super cycle.
"We are only around $5 away and the oil price has moved almost $5 in the last two days. It might seem miles away, but its not
really," said Tamas Varga, analyst at PVM Oil Associates.
Banks such as Goldman Sachs have said oil could fall to as low as $20 per barrel as the world might run out of storage to place
unwanted crude. World oil stockpiles are at a record, according to the International Energy Agency.
In yet another indication of fierce market battles, trading sources said Saudi Arabia was shipping more crude oil to Asia over the
last two months of the year.
On the demand side, China's crude oil imports for the first 11 months of the year rose 8.7 percent to 6.61 million barrels per day,
with November crude imports growing 7.6 percent from the same month a year ago.
China's November sales of new vehicles jumped 17.6 percent over the same period.
With crude prices near record lows, China is seen as likely to double its strategic oil purchases in 2016, adding 70-90 million
barrels to its strategic petroleum reserves (SPR).
(Additional reporting by Henning Gloystein and Roslan Khasawneh in Singapore; Editing by Keith Weir and Susan Thomas)

Brent Crude Dips Below $40 a Barrel

Fundamental concerns regarding oversupply still blight the market
By NICOLE FRIEDMAN and KEVIN BAXTER | Updated Dec. 8, 2015 10:46 a.m. ET | Bit.ly/WSJ8Dec15
Oil prices continued sliding Tuesday, with Brent, the global benchmark, briefly falling below $40 a barrel for the first time since
February 2009.
Oil prices have plunged in the past year as producers including the U.S. and members of the Organization of the Petroleum
Exporting Countries have pumped oil at near-record highs. A stronger dollar has also weighed on oil prices this year, making the
dollar-priced commodity more expensive for buyers using foreign currencies.
Some of the biggest beneficiaries of the rout in oil prices are U.S. drivers, who have seen much of the price drop passed through
to their costs at the pump. The U.S. retail gasoline price averaged $2.027 a gallon Tuesday, the lowest level since March 2009
and 64 cents below a year ago, according to AAA. Two-thirds of U.S. gas stations are selling gasoline for less than $2 a gallon,
the motor club said.
Countries that rely on oil revenue are struggling, and the drop in oil prices has roiled financial markets this year. Some analysts
warn that low prices today could cause a price spike in the future, as companies have cut billions of dollars in investment in new
production and are expected to cut more spending next year.
Brent fell as low as $39.81 a barrel in early trading and recently traded down 51 cents, or 1.3%, to $40.22 a barrel on ICE Futures
Europe. The U.S. crude benchmark fell 35 cents, or 0.9%, to $37.30 a barrel on the New York Mercantile Exchange.
Both benchmarks fell more than 5% on Monday, bringing energy companies shares down with them.
Some traders are reluctant to take any risks in this market until next weeks decision from the U.S. Federal Reserve on interest
rates. Higher interest rates could strengthen the dollar, weighing on oil prices.
[Brent] is looking very isolated at the moment, Michael Nielsen, senior trader at the Copenhagen-based oil trader Global Risk
Management, said. I am on the sidelines now until the Fed makes its decision.

Mr. Nielsen isnt alone.

Norbert Ruecker, head of commodities research at Julius Baer , warned against so-called bottom-fishing, where investors buy at
what they believe is the lowest price in the belief that prices will soon recover. Mr. Ruecker believes the recovery is some way off,
given continued oversupply, he said in a note.
Prices below $40 a barrel could accelerate the pace at which global production declines, analysts say, as companies slash
spending further. The U.S. Energy Information Administration is expected to release its monthly supply-and-demand forecasts
later Tuesday, and market outlooks are expected from OPEC and the International Energy Agency later this week.
Traders are also waiting on weekly inventory data from the EIA on Wednesday. U.S. crude inventories have climbed in recent
weeks at a time of year when they usually fall, and an additional stockpile build could weigh on prices.
Gasoline futures recently fell 0.4% to $1.205 a gallon. Diesel futures fell 1.8% to $1.257 a gallon.
Write to Nicole Friedman at nicole.friedman@wsj.com and Kevin Baxter at Kevin.Baxter@wsj.com

Opec bid to kill off US shale sends oil price down to 2009 low
Oil falls by $2 a barrel with energy shares as Opec refusal to stop flooding the
market with cheap oil and likely US rate hike sends Brent crude tumbling
Larry Elliott Economics editor | Monday 7 December 2015 18.55 EST | Bit.ly/Guard7Dec15

Oil prices have slumped by 5% after the latest attempt by Saudi Arabia to kill off the threat from the US shale industry sent crude
to its lowest level since the depths of the global recession almost seven years ago.
Signs of disarray in the Opec oil cartel prompted fears of a global glut of oil, wiping $2 off the price of a barrel of crude on Monday
and leading to speculation that energy costs could continue tumbling over the coming weeks.
Shares in energy companies lost ground as the impact of the drop in oil prices rippled through European stock markets. Prices of
other commodities also weakened following disappointment among traders that Opec had decided late last week to keep flooding
the global market with cheap oil.
Iron ore continued its steady fall and finished the latest session at $38.90 per tonne, squeezing profit margins to the bone at even
large producers such as Rio Tinto and BHP Billiton, whose shares fell sharply on the Australian stock market on Tuesday.
The consultancy Capital Economics tweeted: #Oil sell-off after #OPEC makes even ECB look good. Better to have announced
something, even if less than hoped for, than nothing at all...
A barrel of benchmark Brent crude was changing hands for less than $41 a barrel in New York on Monday night after Opec
heavily influenced by Saudi Arabia did nothing about a market already seen as saturated.
US light crude, which tends to trade at slightly lower levels than Brent, recorded similar falls, dropping from just over $40 a barrel
to less than $38 a barrel.
Both Brent and US light crude were at levels not seen since early 2009, when the collapse of US investment bank Lehman
Brothers triggered the most severe recession since the 1930s.
As recently as August 2014, Brent stood at $115 a barrel, but in 16 months its price has been more than halved in response to a
slowdown in China and other emerging market economies, and the end of oil sanctions against Iran.
Global supply of oil is currently thought to be up to 2m barrels per day higher than demand, with traders fearing that Opecs
refusal to cut production despite the financial pain it is causing its members economies will lead to a still greater glut of crude.
Venezuela, in particular, is thought to be suffering badly as a result of the drop in oil prices.

The fall, if sustained, will lead to lower inflation in oil-consuming nations through the knock-on effects on petrol, diesel, domestic
energy prices and the cost of running businesses.
Lower crude prices may also delay or limit increases in interest rates. The Bank of England has already accepted that inflation
which stands at -0.1% has stayed lower for longer this year than it anticipated.
Analysts believe the slide in oil prices has come too late to persuade the US Federal Reserve, Americas central bank, to delay
an increase in the cost of borrowing later this month, adding that the prospect of the first tightening of policy from the Fed since
2006 was an added factor in crudes decline.
The prospect of higher US interest rates has led to the value of the US dollar rising on foreign exchanges; since oil is priced in
dollars that has led to a fall in the cost of crude.
Markets had been expecting Opec to announce a new ceiling on production after last Fridays meeting, but analysts at Barclays
said the lack of any curbs in its announcement was a sign of discord.
Past communiques have at least included statements to adhere, strictly adhere, or maintain output in line with the production
target. This one glaringly did not, they said.
Saudi Arabia needs oil prices of $100 a barrel to balance its budget, but as the worlds biggest exporter of crude it is gambling
that the low price will knock out the threat posed by so-called unconventional supplies, such as shale.
The chief executive of Saudi Aramco, Amin Nasser, said at a conference in Doha on Monday that he hoped to see oil prices
adjust at the beginning of next year as unconventional oil supplies start to decline.
In a sign that US production could dip, Baker Hughes November data showed US rig count numbers down month-by-month by
31 to 760 rigs.
The fall in oil prices helped wipe almost 1% off share prices in New York. Wall Streets Dow Jones industrial average was down
more than 160 points in early trading, with Chevron and Exxon both losing around 3% of their value.
In London, Shells share price was down 4.5% while BP lost 3.4% of its value as early gains in the FTSE 100 were wiped out.
The Index closed 15 points lower at 6223.