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Shorting Oil, Hedging Tesla

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Please be Chevron
Please be Chevron
Please be Chevron


Saudis in Talks to Sell 1% of Aramco to ‘Leading’ Foreign Peer​


Saudi Arabia is in talks to sell a 1% stake in state-controlled oil giant Aramco to a foreign company, Crown Prince Mohammed Bin Salman said in an interview with a local TV station.

The kingdom could also announce a secondary offering of shares in the company within the next two years, he said.

“I don’t want to give any promises about deals finalizing, but there are discussions happening right now about a 1% acquisition by one of the leading energy companies in the world,” the Crown Prince said. “This deal could be very important in strengthening Aramco’s sales in the country where this company resides,” he said, adding it’s a very large nation.
 
Electric vehicles on world’s roads expected to increase to 145m by 2030

A report by the International Energy Agency has found that there could be 230m electric vehicles worldwide by 2030 if governments agreed to encourage the production of enough low-carbon vehicles to stay within global climate targets. The IEA’s first global report on electric vehicles has found that sales in the first quarter of 2021 were more than 2.5 times higher than in the same months last year, when the Covid-19 pandemic triggered a string of recessions across global economies.

Under existing climate policies, electric vehicles could wipe out use of 2m barrels a day of diesel and petrol
 
Electric vehicles on world’s roads expected to increase to 145m by 2030

A report by the International Energy Agency has found that there could be 230m electric vehicles worldwide by 2030 if governments agreed to encourage the production of enough low-carbon vehicles to stay within global climate targets. The IEA’s first global report on electric vehicles has found that sales in the first quarter of 2021 were more than 2.5 times higher than in the same months last year, when the Covid-19 pandemic triggered a string of recessions across global economies.

Under existing climate policies, electric vehicles could wipe out use of 2m barrels a day of diesel and petrol

Given that Elon is projecting something like 50M+ from Tesla alone by 2030 and the previous tack record of IEA projections......

Twitter_Auke_Hoekstra_IEA_PV-Vorhersagen-1024x512.jpg


I'm gonna say betting on something like 5x their estimate is a more logical wager.
 
Biden faces pressure to drive gasoline and diesel cars out of the US

Joe Biden’s administration, seeking deep cuts to planet-heating emissions, is facing pressure to take a previously unthinkable step: declare the end of the internal combustion engine in the US. Washington state has moved to call time on the age of gasoline and diesel cars, with the legislature passing a goal that new car sales be only zero-emission vehicles from 2030, including out of state purchases that are then imported. The legislation now awaits to signature of Governor Jay Inslee, a Democrat who previously ran for president on the climate crisis platform.Joe Biden’s administration, seeking deep cuts to planet-heating emissions, is facing pressure to take a previously unthinkable step: declare the end of the internal combustion engine in the US. Washington state has moved to call time on the age of gasoline and diesel cars, with the legislature passing a goal that new car sales be only zero-emission vehicles from 2030, including out of state purchases that are then imported. The legislation now awaits to signature of Governor Jay Inslee, a Democrat who previously ran for president on the climate crisis platform.
Squirrels can make electric cars and squirrels can maintain them,” said Robin Chase, an environmentalist and co-founder of car sharing company Zipcar, emphasizing the ease of making the vehicles. She pointed out that manufacturing of electric cars requires a third less workers than their traditional counterparts.
 
Given that Elon is projecting something like 50M+ from Tesla alone by 2030 and the previous tack record of IEA projections......

Twitter_Auke_Hoekstra_IEA_PV-Vorhersagen-1024x512.jpg


I'm gonna say betting on something like 5x their estimate is a more logical wager.
OT (slightly)
there have been off again, on again complaints about Science Fiction authors
they _don't_ think far enough into the future, and reality goes roaring past, “red shifting and accelerating”
 
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The high oil price and recent headlines like this has me thinking long dated Chevron puts again. I haven't done any previously and I'll be pretty picky about getting in, but still thinking.
I'm only seeing options out to Jan 2023. Waiting til June 2023 becomes available. That and I have absolutely zero dollars at the moment!

They're insanely juicy. $60 puts are basically free. Probably gonna jump up and target $70 puts for June 2023 hoping the share price is around $115 at the time.

Edit:.I still think it looks like CVX may stay relevant longer than XOM and certainly the likes of OXY. Probably should buy them in that order OXY, then XOM, then CVX.
 
Vulnerable....


After repeated warnings about the vulnerability of critical infrastructure following a wave of ransomware attacks in recent weeks, a mysterious new criminal group took matters to an extreme this weekend and forced the shutdown of one of the largest gas pipelines in the U.S.
The FBI, the Energy Department, and the White House are all on the case and assessing the damage after Colonial Pipeline announced Friday it had shut down 5,500 miles of pipeline along the East Coast, potentially disrupting supplies of gasoline and jet fuel in a huge swath of the country. The company, which is responsible for transporting 45 percent of fuel used on the East Coast, said its corporate computer networks had been breached, with ransomware attackers holding data hostage.
 
How convenient a ransomware attack would hit right when it's becoming clear the oil traders have gotten waaaaay ahead of themselves and pumped WTI up waaaaaay too high relative to actual recovery demand. What a serendipitous coincidence!

That should get us through the Memorial Day season where people will consume regardless of price, then a drift back down before another "tanker attack" or some such disruption leading up to the 4th of July.

Oil demand has peaked and everyone knows it. This demand rebound ruse is showing remarkable stamina.
 
How convenient a ransomware attack would hit right when it's becoming clear the oil traders have gotten waaaaay ahead of themselves and pumped WTI up waaaaaay too high relative to actual recovery demand. What a serendipitous coincidence!

That should get us through the Memorial Day season where people will consume regardless of price, then a drift back down before another "tanker attack" or some such disruption leading up to the 4th of July.

Oil demand has peaked and everyone knows it. This demand rebound ruse is showing remarkable stamina.
/rant on
learned long ago
“don’t attribute to malice what can be explained by incompetence and lazieness”

aside:
i did low level computer security 6-8 years before retiring
you would be perhaps amazed at number of computer admins who didn’t have latest patches on servers, a number whom had been minor hacked with main page declaring “you’ve been hacked” probably by script kiddies

some literally had to be given ultimatum to do all patches or be refused internet access until patched and a few got taken off line until.
(do _you_ have all your patches for all _your_ programs, changed _all_ your default passwords, like “admin” “guest” and such?
updated printer drivers, switch drivers, modem and router drivers and passwords, had a penetration scan of your network (a bit more difficult admittedly, have your malware and virus scanners running on “super paranoid”

you may have a bot lurking so your computer could become a zombie in a coordinated attack without you even knowing

remember about 10 or so years back?
”new dot net” hacked a lot of TCP/IP stacks to send all traffic to servers out west in a US state so you could change your name from “dot com” to “dot anything” a “man in the middle” attack that examined everything you sent and received.
we had an infestation from them for a bit until they were “hammer of ghod” blocked

/rant off
 
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/rant on
learned long ago
“don’t attribute to malice what can be explained by incompetence and lazieness”
I generally attribute this kind of thing to conveniently unchecked incompetence. Dick Cheney made it popular a ways back.

Penerrations happen. When it happens at precisely the most perfect time for the "victim", I raise a flag.
 
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Why Charles Koch Wins When Our Energy System Breaks Down Opinion | Why Charles Koch Wins When Our Energy System Breaks Down
In the United States, we live in the worst of all energy worlds, one whose fate hinges on an aging, increasingly unreliable fossil fuel infrastructure dominated by a very small group of very profitable corporations. Yet lawmakers, paralyzed by political fights fueled by these entrenched corporations that profit from the status quo, are often unwilling or unable to either fix the system or build something new.
Every time the Colonial Pipeline fails, it shows us that we can choose one of two solutions to the problem: Reinvest in the fossil fuel economy by laying more pipelines and building more oil refineries. The alternative? Investing in a new system with a decentralized industry based on renewable fuel sources. But when offered these two choices, America has stubbornly insisted on fully committing to neither.
While Mr. Koch famously promotes a libertarian agenda that seeks to limit the reach of government and opposes public efforts to boost renewable energy, the truth is more complicated: Just by letting the broken market limp along, Koch Industries reaps extraordinary profits from a broken system. This is true along the path of the Colonial Pipeline; its business model isn’t in jeopardy. When the gas stations are fully supplied, its owners can once again enjoy the profits that come from controlling nearly half of the East Coast’s gasoline market. When the next crisis hits the Colonial Pipeline, it will once again shut down. Panic buying will resume. And people will ask, yet again: How did this happen?
 


Yes, the fuel-carrying pipeline was shut down last week in order to prevent a company that is entrusted with what should be a public utility from enduring an accounting headache.
 
Well the lumber bubble has popped. I wonder if we'll see oil start tanking if this week's EIA report is a rough one. India is an absolute mess of a lockdown and Europe demand is simply not recovering. We shall see.

This whole recovery play seems mighty shaky to me. Here's hoping the likes of Chevron, Exxon, OXY can hold on a couple months while I rebuild my cash position following the Great Options Rout of 1Q21. Would looooooove to be buying CVX puts this week with SP popping over $110. Happy to wait a bit though, the market has some extraordinarily irrational faith that CVX will somehow be the last man standing.
 
Well the lumber bubble has popped. I wonder if we'll see oil start tanking if this week's EIA report is a rough one. India is an absolute mess of a lockdown and Europe demand is simply not recovering. We shall see.

This whole recovery play seems mighty shaky to me. Here's hoping the likes of Chevron, Exxon, OXY can hold on a couple months while I rebuild my cash position following the Great Options Rout of 1Q21. Would looooooove to be buying CVX puts this week with SP popping over $110. Happy to wait a bit though, the market has some extraordinarily irrational faith that CVX will somehow be the last man standing.

Looking like the oil bubble may have popped as well. And crypto. Perhaps all bubbles? A few weeks back every dbag analyst and even Cramer on CNBC were saying to watch lumber. As soon as lumber popped, they "predicted" everything else would pop too.

Well here we are a week after lumber popped and WTI is dropping 5% on what looks to me like flat inventories. The headlines are all tagging it as a "supply build", but it's minuscule at best. We have just been oversupplied for 6 years and it's not ever going to abate. I could see this as a loooooooong drift downward for oil until the next massive disruption. Perhaps starting now, perhaps the "reopening play" will give it another month of momentum, but it's in real bad fundamental shape IMO.

What are we gonna do with all these contracts the US frackers are buying up at $65 the last month and a half? Hell, they've been buying since WTI hit $45 and actual production hasn't topped 11M barrels a day yet(down from 13M pre-covid).
 
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What are we gonna do with all these contracts the US frackers are buying up at $65 the last month and a half? Hell, they've been buying since WTI hit $45 and actual production hasn't topped 11M barrels a day yet(down from 13M pre-covid).
Yeah - if I were in the shale business I would have been busy buying every $65 future delivery contract that sellers were willing to provide. Depending of course on the cost of those purchases - being able to deliver oil to the market at $65 should make them profitable. And it'll be up to the people taking delivery to figure out what to do with their $65/bbl oil :)

But heck - the shale producers might get another year or 3 of profitable business activity from this.
 
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