Daniel Yergin, who won Pulitzer for his oil history book "The Prize," is the person to talk to for the lay of the land at CERAWeek. He's the vice chairman of conference host IHS Markit and the founder of Cambridge Energy Research Associates (which IHS bought in 2004) and chatted with Axios ahead of today's conference opening. A few highlights ...
The vibe: He said the oil industry has a stronger pulse than it did at last year's gathering. Why? "The industry is feeling better … prices are 75 percent higher than they were last time at CERAWeek, and the confidence that there is a kind of a floor under the oil price."
"At $50 a barrel, this is a very productive industry, and at $55, we think U.S. production this year could increase by between 500,000 and 600,000 barrels a day," Yergin said.
One theme of the week is also how U.S. shale oil producers can bring oil from the ground for less money. Technology advances are one of the major reasons why, and drilling services companies have also cut what they charge. Key statistic: his firm calculates that each dollar spent on shale today will produce 2.5 times more oil than a dollar spent just two years ago.
"Permania." That means "Permian mania." The continued output growth and dealmaking in the Permian Basin shale region in Texas and New Mexico will be a theme this week. "You will hear it from the CEOs of the major companies. These are companies that are not thinking about new, big, multi-billion dollar mega projects that will take 10 years, they are thinking about wells that you can drill in 90 days, and that is a huge change," he said.
Carbon emissions: The conference is unfolding amid a mystery about whether Trump will abandon the Paris climate change deal that is supported by almost 200 countries (more on that below). He noted that the oil-and-gas industry isn't united on this, with some of the U.S. independent oil producers skeptical of the Paris accord that won backing from the international majors that operate worldwide. The majors, he said, will continue preparing for a lower carbon-emission world. "I don't see them going backwards from it," Yergin said, noting the focus on natural gas (which emits less carbon than coal when burned) and developing carbon capture technology.