The home heating oil industry has a long and proud history, and Fuel Oil News has been there supporting it since 1935. It is an industry that has faced many challenges during that time. In its 77th year, Fuel Oil News is doing more than just holding
Issue link: https://read.dmtmag.com/i/739848
10 NOVEMBER 2016 | FUEL OIL NEWS | www.fueloilnews.com FUELS EIA NE WS NATSO APPLAUDS BIODIESEL BLENDERS' TAX CREDIT LEGISLATION NATSO, the national association representing travel plazas and truckstops, applauded Rep. Diane Black (R-Tenn.) for introduc- ing the "Biodiesel and Renewable Diesel Incentive Extension Act of 2016," (H.R. 5994) that would extend the biodiesel blenders' tax credit for two years through 2018. "We commend Rep. Black for introducing legislation that will renew this critical tax credit," NATSO Vice President of Government Affairs David Fialkov said in a statement. "Renewing the biodiesel blenders' tax credit is the right deci- sion for both fuel retailers and the American people. Without a blenders' credit, fuel prices across the country will inevitably increase, which in turn would increase the costs of shipping while driving customers away from cleaner burning fuels. By extending the biodiesel tax credit, fuel marketers will be able to increase the volume of cleaner-burning fuels in the United States while simultaneously offering customers a lower price. It's a win-win for everybody." The tax credit is set to expire at the end of 2016 unless Congress acts to extend it. Since 2005, the $1 per gallon biodiesel blenders' tax credit has helped fuel retailers to sell biodiesel at a price that is cost com- petitive with gasoline and diesel, thereby advancing consumer consumption, the association said in its statement, issued Sept. 19. Failure by Congress to renew the tax credit, or converting the tax credit from a blenders' credit to a producers' credit, would drive up biodiesel prices to a degree that would diminish con- sumer interest in the product, ultimately hindering U.S. efforts to advance the utilization of cleaner burning fuels, according to the association. NATSO is headquartered in Alexandria, Va. FORECAST: RIG COUNT TO GROW BY NEARLY A THIRD IN 2017 Oil prices will continue to be the primary catalyst determining U.S. rig demand in the months ahead, according to a fore- cast released by Platts RigData. The U.S. Land Rig Three-Year Forecast, now in its second year, is an analysis of the key drivers of domestic oil and gas supplies and what they imply for the next three years' land rig demand. "OPEC's latest agreement to modestly reduce production, a move aimed at supporting the price of crude oil globally, reinforces our expectations of strengthened U.S. rig counts next year," said Trey Cowan, senior industry analyst, Platts RigData, a unit of S&P Global Platts, based in Houston, Texas. Specifically, Platts RigData projects the U.S. rig count will grow by an average of 131 rigs or 29% year over year during 2017. This would be an increase from the average estimated 449 rigs actively drilling in 2016. Forecast highlights include: Oil prices to trend higher as incremental U.S. supply levels normalize Oilfield service activity to continue the recovery begun in May Elevated production derived from "high grading" (where operators focus on developing the highest returning wells) has entered the latter stages for this recovery cycle Lower incremental-production volumes per well are likely Despite recent drawdowns in drilled-but-uncompleted (DUCs) wells, oil and natural gas supply unlikely to expand as rapidly as first signaled "In our opinion, the expected smaller incremental-well pro- duction volumes would imply the need for a greater number of wells to be brought into production in order to reach targeted production goals," said Cowan. "To this end, Platts RigData expects more than 11,000 U.S. oil & gas wells to be drilled dur- ing 2017. That would be an improvement of 25% year over year versus our 8,900 well spud estimate for 2016." Key components of the forecast: Regional projections of a base case plus a downside and upside growth case Regional summaries of developments, commodity prices, and operators' drilling sentiments Assessment of macroeconomics Outlook for technology advancements, effects of rig fleet age, and financial health of large service providers DUCs inventory overhang and outlook The 2016 edition of the Platts RigData U.S. Land Rig Three- Year Forecast is available in print and PDF format, including an Excel workbook with all supporting data. For more informa- tion or to subscribe to the Forecast, visit http://rigdata.com/ us-land-rig-three-year-forecast. S&P Global Platts acquired RigData, a provider of daily information on rig activity for the natural gas and oil markets across North America, on June 1, 2016. S&P Global Platts provides information and benchmark prices for the commodities and energy markets. S&P Global Platts' coverage includes oil and gas, power, petrochemicals, metals, agriculture and shipping.