Optimistic Powell can prevent the inflation part of stagflation, but doubt we will escape the stagnation part. Silver lining is that would be good news for those hoping for downward pressure on oil prices which would deprive a certain dictator or current generous oil revenues/profits.
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TheTalkingMule
Distributed Energy Enthusiast
We'll see. I'm tracking my own stagnation indicators on LinkedIn. When I see all my consulting buddies begging to fill open positions, I know corporate spending is still insane and hiring will continue.
I'm seeing a lot of folks jumping to competitors, as I'm sure all of you do, these moves need to turn into expensive initiatives and results or the useless VP who authorized them will get the axe. I'm confident corporate profits and cash piles are high enough to keep the hamster wheel going.
I think Powell has played a successful game of chicken here. With a WH willing to do literally anything to get oil lower, it was never really a fair game to begin with. Market expectations are now for continual massive rate hikes and ballooning energy costs. I don't think we'll see either.
I'm seeing a lot of folks jumping to competitors, as I'm sure all of you do, these moves need to turn into expensive initiatives and results or the useless VP who authorized them will get the axe. I'm confident corporate profits and cash piles are high enough to keep the hamster wheel going.
I think Powell has played a successful game of chicken here. With a WH willing to do literally anything to get oil lower, it was never really a fair game to begin with. Market expectations are now for continual massive rate hikes and ballooning energy costs. I don't think we'll see either.
Doggydogworld
Active Member
Citi says recession could drive oil to 65 by end of this year and 45 by YE23. But note that "Citi’s global head of commodity research, Ed Morse, has been bearish on oil for months" so he may not be the brightest bulb on the porch.
TheTalkingMule
Distributed Energy Enthusiast
This Buffett OXY purchase ain't looking so hot, but earnings are just around the corner.
Some of you folks might wanna consider selling your puts that are up a lot. XOM is about to print a meganumber for 2Q earnings and PE will drop to like 9 or 10.
Ride the rollercoaster! You can always rebuy puts when XOM head back over $100.
Some of you folks might wanna consider selling your puts that are up a lot. XOM is about to print a meganumber for 2Q earnings and PE will drop to like 9 or 10.
Ride the rollercoaster! You can always rebuy puts when XOM head back over $100.
Already sold yesterday... Should have waited until this morning but whatever...
TheTalkingMule
Distributed Energy Enthusiast
Strategic reserve release continues to work wonderfully. Oil futures popped this morning on general market euphoria, now the 11am report has brought it back down a bit.
Gas & diesel consumption down 5% from this time last year.
All good signs.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/2K7D3BBDPJM75IEY4VHK2VONQI.jpg)
www.reuters.com
Gas & diesel consumption down 5% from this time last year.
All good signs.
U.S. crude inventories soar, fuel stocks dip -EIA
U.S. crude oil stockpiles rose sharply last week, driven by an increase in inventories and as refiners cut output, the Energy Information Administration said on Thursday.
www.reuters.com
mspohr
Well-Known Member
I was just wondering about the strategic reserve. Does the government own the oil in the reserve? Are they now selling it at today's high prices?Strategic reserve release continues to work wonderfully. Oil futures popped this morning on general market euphoria, now the 11am report has brought it back down a bit.
Gas & diesel consumption down 5% from this time last year.
All good signs.
U.S. crude inventories soar, fuel stocks dip -EIA
U.S. crude oil stockpiles rose sharply last week, driven by an increase in inventories and as refiners cut output, the Energy Information Administration said on Thursday.
TheTalkingMule
Distributed Energy Enthusiast
CNBC coverage of the same reality....U.S. crude inventories soar, fuel stocks dip -EIA
U.S. crude oil stockpiles rose sharply last week, driven by an increase in inventories and as refiners cut output, the Energy Information Administration said on Thursday.
Lol
TheTalkingMule
Distributed Energy Enthusiast
There are a million and one single stock ETFs now. Explain to me again why we don't have ETFs for each expiration and strike for WTI contracts?
Do y'all see value in or demand for a vehicle that tracks $100 WTI futures for a specific expiration like Dec 2023?
I'd love to short something like Dec 2024 $100 WTI contracts. Wonder what that would look like in ETF form?
Obviously you could just buy or sell barrels or options, but that's not what I want.
Do y'all see value in or demand for a vehicle that tracks $100 WTI futures for a specific expiration like Dec 2023?
I'd love to short something like Dec 2024 $100 WTI contracts. Wonder what that would look like in ETF form?
Obviously you could just buy or sell barrels or options, but that's not what I want.
TheTalkingMule
Distributed Energy Enthusiast
Saudi Arabia is air conditioning itself with Russian crude. The same Saudi Arabia that's perpetually been 2 years away from doing this with solar.
www.euractiv.com
Russian supply will not be disrupted in any meaningful way.
Saudi Arabia doubles discounted Russian fuel oil imports
Saudi Arabia, the world's largest oil exporter, more than doubled the amount of Russian fuel oil it imported in the second quarter to feed power stations and free up the kingdom’s own crude for export, data showed and traders said.
www.euractiv.com
Russian supply will not be disrupted in any meaningful way.
mspohr
Well-Known Member
So, are they importing evil Russian oil so they can export more "good" Saudi oil?Saudi Arabia is air conditioning itself with Russian crude. The same Saudi Arabia that's perpetually been 2 years away from doing this with solar.
Saudi Arabia doubles discounted Russian fuel oil imports
Saudi Arabia, the world's largest oil exporter, more than doubled the amount of Russian fuel oil it imported in the second quarter to feed power stations and free up the kingdom’s own crude for export, data showed and traders said.
Russian supply will not be disrupted in any meaningful way.
Doggydogworld
Active Member
24k bpd doesn't exactly move the global oil balance needle, but it exemplifies the kind of inefficiencies the sanctions cause. Instead of Russia shipping direct to Europe and Saudi Arabia burning a bit of their own oil onsite both supply lines are now much longer. Multiply this by 500x for all the other dislocations and it's enough to drive prices up.
We didn't reduce consumption by any meaningful amount, so by definition Russia still exports almost as much as before. We just pay them more for it. And the idiot politicians get to pretend they're striking a blow against Putin.
TheTalkingMule
Distributed Energy Enthusiast
The clock is ticking, near term urgency is building. How long til the global cartel breaks and it's an all out race to claim the last couple hundred billion barrels of delivery?
/cloudfront-us-east-2.images.arcpublishing.com/reuters/FGSH7QCD7RJ6NN35XAFXNQGPII.jpg)
www.reuters.com
Insight: Guyana races against the clock to bank its oil bonanza
For the poor, small South American country of Guyana, there's no time like the present when it comes to reaping the rewards of its offshore oil jackpot.
www.reuters.com
TheTalkingMule
Distributed Energy Enthusiast
TheTalkingMule
Distributed Energy Enthusiast
WTI rises on inventory drop!
(Nevermind that net exports were at about their highest level in history last week)
What a coincidence! These guys really know what they're doing. Fully vertically integrated from extraction to refining to Wall Street manipulation.
(Nevermind that net exports were at about their highest level in history last week)
What a coincidence! These guys really know what they're doing. Fully vertically integrated from extraction to refining to Wall Street manipulation.
mspohr
Well-Known Member
Opinion | Hardly Anyone Talks About How Fracking Was an Extraordinary Boondoggle
In the energy scramble provoked by Russia’s invasion of Ukraine, American liquid natural gas has so far played the role of Europe’s white knight. If Europe manages to keep its lights on, homes heated and factories running this winter, when energy demand is highest, it will be in large part thanks to shipments of American gas, which have more than doubled since the war began.
Perhaps the most striking fact about the American hydraulic-fracturing boom, though, is unknown to all but the most discriminating consumers of energy news: Fracking has been, for nearly all of its history, a money-losing boondoggle, profitable only recently, after being propped up by so much investment from venture capital and Wall Street that it resembled less an efficient-markets no-brainer and more a speculative empire of bubbles like Uber and WeWork.
In the energy scramble provoked by Russia’s invasion of Ukraine, American liquid natural gas has so far played the role of Europe’s white knight. If Europe manages to keep its lights on, homes heated and factories running this winter, when energy demand is highest, it will be in large part thanks to shipments of American gas, which have more than doubled since the war began.
Perhaps the most striking fact about the American hydraulic-fracturing boom, though, is unknown to all but the most discriminating consumers of energy news: Fracking has been, for nearly all of its history, a money-losing boondoggle, profitable only recently, after being propped up by so much investment from venture capital and Wall Street that it resembled less an efficient-markets no-brainer and more a speculative empire of bubbles like Uber and WeWork.
Doggydogworld
Active Member
It's official - I'm now "Hardly Anyone"
From a comment last month:"Global all-liquids production grew 13m bpd from 2010-19. Almost 80% of that growth, 10m bpd, came from the US. We became the world's swing producer. We went from being by far the world's largest importer, adding as much as 500b/year to our trade deficit, to a net exporter. US oil and gas investors funded this economic miracle, but they themselves did not do so well. Oil fell below 60/bbl and stubbornly refused to return to 'where it should be'.
Then Covid hit and poor ROI turned into an unmitigated disaster. Hundreds of billions were written off."
For all the (well-deserved) blame Biden gets for his efforts to reduce domestic oil supply and push up gas prices, it was the shale cowboys and COVID that set the stage. The cowboys burnt so much investor capital that people became reluctant to fund them, then COVID and the ensuing negative (!!) oil price shut the flow of funds off almost entirely.
mspohr
Well-Known Member
We all know that you are special and we appreciate your insight and wisdom.It's official - I'm now "Hardly Anyone"
"Global all-liquids production grew 13m bpd from 2010-19. Almost 80% of that growth, 10m bpd, came from the US. We became the world's swing producer. We went from being by far the world's largest importer, adding as much as 500b/year to our trade deficit, to a net exporter. US oil and gas investors funded this economic miracle, but they themselves did not do so well. Oil fell below 60/bbl and stubbornly refused to return to 'where it should be'.
Then Covid hit and poor ROI turned into an unmitigated disaster. Hundreds of billions were written off."
For all the (well-deserved) blame Biden gets for his efforts to reduce domestic oil supply and push up gas prices, it was the shale cowboys and COVID that set the stage. The cowboys burnt so much investor capital that people became reluctant to fund them, then COVID and the ensuing negative (!!) oil price shut the flow of funds off almost entirely.
I would like to understand your statement that Biden made efforts to reduce domestic oil supply and push up gas prices. Many people have made similar statements but I don't know what Biden has actually done in that area. My understanding of the increase in the price of oil is that it is due to Putin's war disrupting supply. As far as Biden's efforts to reduce domestic oil supply, my understanding is that the oil industry has thousands of unused drilling permits... and they are not drilling because of COVID, worries about demand, and, of course, nervous banks.
mspohr
Well-Known Member
This morning, Shell announced their eye-popping second quarter profits. As we all expected, they raked it in: profiting $11.5 billion -- a 25% increase from their already record breaking profits last quarter. And that’s, of course, made possible by price gouging that’s hurting families all over the country. You’re paying MORE at the pump, so they can make EVEN MORE for their already wealthy shareholders.
Those profits are helping the oil industry buck up their Republican allies in Congress to stand in the way of climate action. New data show Big Oil has spent more than $200 million in the 2022 cycle so far – to fund climate denying candidates, block climate action, and block regulation that would lower prices. It is painfully clear: Big Oil and their Republican cronies are happy to sit on gargantuan profits instead of protecting families and lowering costs.
Those profits are helping the oil industry buck up their Republican allies in Congress to stand in the way of climate action. New data show Big Oil has spent more than $200 million in the 2022 cycle so far – to fund climate denying candidates, block climate action, and block regulation that would lower prices. It is painfully clear: Big Oil and their Republican cronies are happy to sit on gargantuan profits instead of protecting families and lowering costs.
TheTalkingMule
Distributed Energy Enthusiast
And here we are with XOM printing an $18.9B profit in 2Q. We could've predicted that to the penny, anything below 19 doesn't sound too egregious.Wait til these gouging profits start hitting earnings reports. We should really see someshare prices to short.
XOM will likely double profits this quarter to a new record. They're likely scrambling to offset profits and show something a bit lower as we speak, just to avoid the headlines.
Let's see how long middle Americans keep supporting the fossil world now that they know they're being gouged to death.
Hopefully large landowners in the flyover states soon get access to community solar developers/projects. That's when this whole cycle reverses.
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