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Tax treatment of exchange-traded notes and exchange-traded funds
A fund can’t invest more than 25% of assets in master limited partnerships (MLPs), so MLP ETFs structure themselves to forfeit this special tax treatment.
ETFs (exchange-traded funds) have stock-like characteristics, while ETNs (exchange-traded notes) possess bond-like traits.
MLPs (master limited partnerships) represent one component of the energy sector that has performed relatively well amid tanking oil prices.
According to the EIA, crude oil demand will increase by 0.96 MMbpd in 2014. According to the IEA, crude oil demand will increase by 0.7 MMbpd in 2014.
From October 16 to December 16, 2014, Brent crude oil price came down by 29%, from $84.47 per barrel to $60.38 per barrel.
According to EIA estimates, petroleum and other liquids production in non-OPEC countries will grow by about 1.9 MMbbl/d in 2014 and 0.8 MMBbl/d in 2015.
According to the U.S. Energy Information Administration (or EIA), natural gas production in the Eagle Ford Shale increased ~351% in the past eight years.
According to the U.S. Energy Information Administration (or EIA), the Marcellus Shale is the largest producing shale gas basin in the United States.
Horizontal drilling and hydraulic fracturing, higher crude oil prices, and the large size and number of wells in the Bakken have unlocked huge oil reserves.
Power sector natural gas consumption is estimated to rise to 22.75 Bcf/d in 2015, a 1.84% increase from the 2013 level.
Cheniere Energy’s (LNG) Sabine Pass export terminal will begin its service in 2015. The EIA expects that the United States will start exporting natural gas.
For 2014, the EIA expects gasoline price to average $3.37 per gallon and fall to $2.60 in 2015. The fall in crude price was a driving factor for the fall in gasoline prices.
The EIA projects that the Brent crude oil price will average $68 per barrel in 2015, or $15 per barrel lower than November’s forecast.
Net imports as a percentage of US domestic liquids fuel consumption is expected to fall to 21% in 2015, its lowest level since 1969.
The EIA marginally increased its US crude oil production estimate for 2014 to 8.74 MMBbl/d, or 0.03 MMBbl/d higher than its forecast in November.
The fracking revolution and the plunge in prices have rendered the Oil Peak premise false. So alternative fuel companies are being hurt by cheaper oil.
According to estimates by Barclays, the industry could save up to the tune of $10 billion in fuel costs, making airlines lower oil price winners.
A rising dollar has and will continue to put downward pressure on oil prices, causing trouble for the energy sector (XLE).
The US shale boom, increased production elsewhere, as well as OPEC’s decision to maintain output are reasons for the current excess oil supply.
With China in a less oil-intensive stage of development, the demand for oil could stay low for a while.