mblakele
FSD Beta (99)
Here's a fairly recent projection of coal-power capacity in China and elsewhere.
Source: The world is kicking its coal habit. China is still hooked
Source: The world is kicking its coal habit. China is still hooked
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China Doesn’t Need Another Coal Power Plant
If China adds 200 gigawatts of planned coal power to its grid, it risks its own net-zero goals and a stable climate future. New research shows China can reliably meet its energy needs and economic goals by accelerating clean energy and phasing out coal.
www.forbes.com
Looks like China really overdoing it on coal.
In other news, well, the headline says it all: world’s largest direct air carbon capture system goes online. What’s lower in the article: the world’s largest DAC plant removes the equivalent emissions of 870 cars. Whoop-de-do.
www.vice.com
World's Largest Direct Air Carbon Capture System Goes Online
The Orca represents 40 percent of the world's direct air carbon capture capacity, but its overall capabilities are still minuscule and controversial.
www.vice.com
TheTalkingMule
Distributed Energy Enthusiast
Well that's interesting....
finance.yahoo.com
China(the only real demand growth story along with India), is selling off it's reserves. Kinda makes you wonder about this supposed "looming supply crunch".
If this doesn't bring crude markets back down to Earth, nothing will. Folks will need to capitulate to the fact of global crude markets being completely rigged and get on with their lives.
China Intervenes in Oil Market With Historic Sale of Reserves
(Bloomberg) -- China made an unprecedented intervention in the global oil market, releasing crude from its strategic reserve for the first time with the explicit aim of lowering prices.The announcement comes amid surging energy costs in China, not just for oil but also for coal and natural gas...
China(the only real demand growth story along with India), is selling off it's reserves. Kinda makes you wonder about this supposed "looming supply crunch".
If this doesn't bring crude markets back down to Earth, nothing will. Folks will need to capitulate to the fact of global crude markets being completely rigged and get on with their lives.
TheTalkingMule
Distributed Energy Enthusiast
From Bloomberg just now....
This whole narrative is crumbling.
I despise SCO(double short crude ETF) and all other vehicles for shorting the price of oil, but this may be a time to just hold your nose and buy them. Or just sell some barrels for delivery next December @ $63.
This whole narrative is crumbling.
I despise SCO(double short crude ETF) and all other vehicles for shorting the price of oil, but this may be a time to just hold your nose and buy them. Or just sell some barrels for delivery next December @ $63.
adiggs
Well-Known Member
Do you have a feel for the conversion (today) of oil price into majors (Chevron, Exxon, Shell, BP, ..) share prices?
Those other vehicles (future oil, short crude ETF) are types of investment that I have no experience with, beyond know that I need to understand what they do and don't do to make use of them. WHich means I just stay away
But it's not hard for me to understand Chevron up/down - that (public company) is something I have an understanding of.
TheTalkingMule
Distributed Energy Enthusiast
I have absolutely no idea. Oil is somehow up another 2% today, so figuring out this sector's movements is likely more of a technicals exercise than a logical one. I should probably just stop thinking about it.Do you have a feel for the conversion (today) of oil price into majors (Chevron, Exxon, Shell, BP, ..) share prices?
Those other vehicles (future oil, short crude ETF) are types of investment that I have no experience with, beyond know that I need to understand what they do and don't do to make use of them. WHich means I just stay away
But it's not hard for me to understand Chevron up/down - that (public company) is something I have an understanding of.
My thesis is that the bottom's gotta fall out relatively soon(tomorrow thru 2025), in a similar fashion to the coal sector losing 99% of it's valuation overnight(over a year or two). How we play that?? Unclear.
I'm buying long puts on Chevron in increasing amounts with strikes 30-40% below whatever the current SP is. Hoping that does the trick.
I guess we’re not the only ones…
Harvard, America’s richest university, will divest from fossil fuels
It's been rigged for quite a while, but usually to the advantage of producers. Now China is flexing its power as a consumer.Well that's interesting....
China Intervenes in Oil Market With Historic Sale of Reserves
(Bloomberg) -- China made an unprecedented intervention in the global oil market, releasing crude from its strategic reserve for the first time with the explicit aim of lowering prices.The announcement comes amid surging energy costs in China, not just for oil but also for coal and natural gas...
China(the only real demand growth story along with India), is selling off it's reserves. Kinda makes you wonder about this supposed "looming supply crunch".
If this doesn't bring crude markets back down to Earth, nothing will. Folks will need to capitulate to the fact of global crude markets being completely rigged and get on with their lives.
What took them so long?! If Harvard is only taking action now, I'm afraid the less rich and educated institutions will act in decades, far tool late to avoid a huge, unrecoverable catastrophe. That's not comforting at all.
i think we’re speculating here that investing in oil will be unprofitable at some point in the future. But it seems that it hasn’t gotten there yet. There are still dividends, the oil stocks haven’t totally tanked, etc.
So I think the relevance of a move like this is that it’s coming from a place of principle not profit. It wouldn’t mean anything to divest after the oil stocks are tanking. And, in fact, you can argue that the fund managers have a certain obligation to pursue profits, so divesting from oil at present is definitely a statement.
It’s not so much that I think this move will solve the problem on its own, but together with others like it, I think it sends a meaningful message, that I hope more funds will receive. At some point we’ll reach the tipping point where fossil fuel investment becomes more costly due to lack of willing investors… prohibitively expensive, I would hope. And then the oil companies less profitable, and then more funds bail… the textbook Virtuous Circle.
TheTalkingMule
Distributed Energy Enthusiast
Bought some SCO. Probably foolish, but this supply narrative has got to break soon.
Saudi cuts prices in half to Asia for October. Refiners are like.....nah thanks.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/VW2AR57E7ZIVNHYL5IMUCAXG7M.jpg)
www.reuters.com
Saudi cuts prices in half to Asia for October. Refiners are like.....nah thanks.
Asia refiners to get full Saudi crude supplies in Oct, didn't ask for extra -sources
Saudi Aramco (2222.SE) has notified at least seven buyers across Asia that it would supply full contractual volumes of crude oil in October, though none of them asked for additional supplies despite deep price cuts, sources with knowledge of the matter said on Monday.
www.reuters.com
TheTalkingMule
Distributed Energy Enthusiast
Brent crossing $75, SCO down 7%+ this morning. Bought a bit more. Don't want to hold this SCO more than a few weeks as it's leveraged and errodes pretty quickly.
Looking forward to today's US supply report. Perhaps folks got a hold of it early and that's why we popped on WTI.
Looking forward to today's US supply report. Perhaps folks got a hold of it early and that's why we popped on WTI.
You're settling for little. By the time this accumaltion of virtue starts to light things up, we'll all be under water or exposed to severe heatwaves and drought, with unprecedented crop failure, food insecurity, with hundreds of millions people on the road look for a livable place.i think we’re speculating here that investing in oil will be unprofitable at some point in the future. But it seems that it hasn’t gotten there yet. There are still dividends, the oil stocks haven’t totally tanked, etc.
So I think the relevance of a move like this is that it’s coming from a place of principle not profit. It wouldn’t mean anything to divest after the oil stocks are tanking. And, in fact, you can argue that the fund managers have a certain obligation to pursue profits, so divesting from oil at present is definitely a statement.
It’s not so much that I think this move will solve the problem on its own, but together with others like it, I think it sends a meaningful message, that I hope more funds will receive. At some point we’ll reach the tipping point where fossil fuel investment becomes more costly due to lack of willing investors… prohibitively expensive, I would hope. And then the oil companies less profitable, and then more funds bail… the textbook Virtuous Circle.
The more we study, the harder it is to spot the silver lining.
TheTalkingMule
Distributed Energy Enthusiast
Every once in a while the truth slips out. These guys aren't gonna help build their own gallows.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/YSFYPZKMZZK3BGRV5RMCW2VSDE.jpg)
www.reuters.com
Chevron would rather pay dividends than invest in wind and solar -CEO
Chevron Corp Chief Executive Mike Wirth said on Wednesday the company prefers to return money to its shareholders rather than use it to invest in solar and wind power projects.
www.reuters.com
Every once in a while the truth slips out. These guys aren't gonna help build their own gallows.
Chevron would rather pay dividends than invest in wind and solar -CEO
Chevron Corp Chief Executive Mike Wirth said on Wednesday the company prefers to return money to its shareholders rather than use it to invest in solar and wind power projects.
"We rather dividend it back to shareholders and let them plant trees," the CEO says.
Unbelievable. What an *ss!
TheTalkingMule
Distributed Energy Enthusiast
It's appropriate tho, and I have no prlem with it. These are oil companies owned by investors. They're doing their job.
My problem is with people who think oil cos aren't gonna delay this transition at every turn, let alone lead the way. Best way to delay it to talk about 5 and 10 year horizons.
My problem is with people who think oil cos aren't gonna delay this transition at every turn, let alone lead the way. Best way to delay it to talk about 5 and 10 year horizons.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/OCTEKS3UJBKS3MXWE2FSLK5TXI.jpg)
Global oil demand to peak in 2026 -Rystad Energy
The rapid adoption of electric vehicles (EV) around the world will probably cause global oil demand to peak two years earlier than previously expected, Norway's biggest independent energy consultancy Rystad said on Wednesday.
www.reuters.com
Likewise, Sinopec now sees Chinese oil demand peaking in 2026.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/JULDBFLXMJIDPNDL5R2XFAF5UE.jpg)
China's oil consumption seen peaking around 2026, Sinopec exec says
China's oil consumption is likely to peak around 2026 at about 16 million barrels per day and that of natural gas by around 2040, according to a top executive of Sinopec Corp .
www.reuters.com
From the beginning of this thread, my view has basically been that global crude demand would peak by 2025 (maybe sooner) and that global demand would likely peak before China's demand would peak. The later point is pretty easy to see because developed OECD countries have largely peaked already while China was the the dominant demand growth engine of the non-OECD world. So as China's demand flattens out while OECD demand continues to fall, there is just not much demand creation outside of China to keep global demand climbing. This is made even more challenging for the oil industry if Brent remands near or above $70/b. That is, the developing world excluding China really does not have the economic heft to grow oil consumption when it is expensive. Indeed, China saw fit to draw from its strategic oil reserve to support consumption in the midst of Brent threatening to breach $80/b. So it looks like even China has hard time tolerating high oil prices.
So if Brent remains north of $70/b, I think China could see its oil demand peak by 2025. And in this scenario global demand could peak by 2024. Even if the price of oil moderates, I think Rystad will have to adjust its forecast again (within 12 months) lowering the global peak and pulling the peak forward to 2025. But the really big confirmation here is that EV uptake is the key driver, and Rystad is admitting it.
COVID-19 Has Upended The Global Labor Market | OilPrice.com
Lockdowns due to the COVID-19 pandemic have given rise to a remote work revolution, and it could change the global labor market forever, and by extension, the entire global economy as well
oilprice.com
There are some good observations about the trend to working from home.
The long-term impacts remain to be seen. Going from 10% remote workforce globally before the pandemic to about 65% during the pandemic, maybe after the pandemic this settles bact to 20% to 50% and growing steadily long-term.
The article does not address the implications for energy markets, yet it seems clear fuel for commuting and other transport of labor takes a huge cut. This is really bad for motor vehicle and motor fuel demand. Perhaps the global economy does not need a 2 billion fleet of motor vehicles. Perhaps 1.8 or 1.6 billion would suffice in the coming years. It's hard to put a solid number on this, but the direction is clear. The ICE fleet in particular does not need to grow while the total fleet is still more more than is needed to transport workers. And by the time the total fleet needs to resume growth, EVs will be scaled up supply all the growth plus some replacement.
This becomes an alternative thesis to the EV Osborne effect thesis. Some fraction of the global workforce discovers that they don't need a commuter vehicle because they work from home or near home. This reduces demand for new vehicles as the total fleet shrinks for a number of years. Quantitatively it may be hard to differentiate the effects from this thesis from those of EV Osborne Effect as both anticipate a decline in total new auto sales until EVs scale up. I'm not saying they are impossible to differentiate, just that it could be hard to discriminate. Moreover, both theses are probably correct to some degree.
Additionally, the longer it takes for the globe to recover from the pandemic, the more established these changes will be. Rystad for one is recognizing that prospects for a large and distant oil demand peak is eroding.
Natural Gas Prices Can Still Double From Here | OilPrice.com
Natural gas prices have absolutely exploded this year, reaching levels not seen since 2014, and the rally is still far from over
oilprice.com
The obvious long-term solution is to build out more renewable energy so that the economies of Europe and Asia are not so dependent on the price of gas. But in the short run the gas market is tight and utilities turn toward coal to close the energy gap.
The US Henry Hub price is around $5/mmBtu. US gas producers participate in the Asian and European gas markets via LNG exports. In this last year the US has added 2.7 Bcf/day LNG processing capacity. This iis enough gas to generate 14.55 GW of electricity at constant rate. Gas prices in the US are as high as they are because exports are increasing by nearly 2.7 Bcf/day.
So I want to know how much of this export of US gas is being replaced by new installations of wind and solar in the US. Current estimates for 2021 installations is 21 GW wind and 26 GW. At EIA average capacity factors of 35% and 25% respectively, this combined installation can generate about GW average, which offsets 2.57 Bcf/day of natural gas. Thus, the increase of wind and solar in the US offset about as much gas as the US is incrementally supplying to Europe and Asia via new LNG capacity.
This is very intriguing that US wind and solar may already be at a scale where it is in equilibrium with the global gas market. Certainly with Henry Hub at $5, wind and solar are extremely competitive for new generation capacity in the US. Really, natural gas generation is the only competition to wind, solar and batteries, but at $5/mmBtu it's nearly priced out to the new generation market. If LNG were to double from here to $36/mmBtu, this would only impact Henry Hub prices to the extent that new LNG capacity is built out in the US. US wind and gas developers should probably take their cue from the ambitions of those building out LNG capacity. For every 1 Bcf/d of new LNG capacity, we should be building out another 8.5 GW wind and 11 GW solar. If wind and solar do not exceed this, then the US economy is impeded by higher domestic gas prices. For now, we can think of LNG as a vehicle for US wind and solar to export energy to Asia and Europe so as to minimize global coal generation and to keep the global economy moving. US wind and solar installations are absolutely essential to keeping the US. Europe and Asia also need to step up their pace of RE installation to avoid paying LNG prices high enough to tank their respective economies.
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