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Energy Outlook. According to energy consultancy PIRA, U.S. shale production will likely flatten next quarter before declining slightly as companies reduce capital spending amid the low oil price environment. This report confirms a similar claim made in a monthly report from OPEC, which also reported that U.S. oil output will decline later this year. Reuters
Oil. According to EIA’s Weekly Petroleum Status Report, the volume of crude oil stored at Cushing, Oklahoma — a significant delivery point for West Texas Intermediate crude supplies — is at its highest level on record. Although inventories at Cushing are at a record high, storage utilization remains below record levels due to additional storage capacity that has been added over time. EIA
Coal. According to studies by the Government Accountability Office, the Interior Department’s inspector general, and nonprofit research groups, the Federal Government has collected less in royalty payments than is legally required for the extraction of coal from public lands. While the Interior Department is taking steps to scrutinize documentation issues, large discounts on royalty payments for coal companies, and noncompetitive lease sales, editors at the New York Times argue that the government should further impose a “carbon adder” on coal sales to help offset the impacts of greenhouse gas emissions and climate change. NY Times
Climate Change. Anne Stausboll writes in the Financial Times that institutional investors ought not divest holdings from companies related to fossil fuels, but rather increase engagement with such companies as part of their “fiduciary duty”. She argues that this legal responsibility positions investors to engage with the companies in which they are invested regarding the long-term management of climate change risks — a strategy more likely to impact companies’ climate change mitigation efforts than simply “passing the buck” to buyers on the open market. FT
