Thursday, April 2, 2020

Notes From All Over, The Saudi Edition -- April 2, 2020

Saudi Arabia foreign exchange reserves, update:
  • how the Saudi decision to launch a price war is reshaping the global oil market, The Fairfield Sun Times, April 2, 2020, updated three hours ago.
  • President talks with Prince MBS, and almost immediately Saudi Arabia calls emergency OPEC+ meeting, Asharq Al-Awsat, April 2, 2020, 18:45 (GMT?)
  • Emerging-Market Petrostates are about ready to melt down: collapsing oil prices risk igniting a sovereign debt crisis, Foreign Affairs, April 2, 2020; of all the sources posting right now, this may be the most important, Foreign Affairs is practically the New Testament for Air War College and the other military senior staff officer schools in residence;
  • Saudi Arabia's oil war could bankrupt the kingdom, oilprice.com via Yahoo!News, March 15, 2020, previously posted;
  • This is probably one of the best -- but very biased -- consider the source -- Russia shows resilience to oil shock while Kazakhstan wobbles, EuroMoney, April 2, 2020 (which would be today):
Compared with Saudi Arabia, which requires a break-even oil price of more than $80 per barrel, Russia’s is around half that and energy minister Alexander Novak has further claimed with some bravado that Russian oil production is competitive at any price. This explains why, so far, Russian authorities have been reluctant to come to some sort of arrangement with Opec to limit production, despite Trump’s hopes for a deal buoying the market in recent days. It means the oil price shock effect will be much less pronounced for Russia than most other oil exporters. Indeed, preliminary data from Euromoney’s first quarter survey – to be officially released next week – shows risk scores worsening for oil-producing countries as diverse as Egypt, India, Indonesia, Malaysia and Norway.

Worst affected are Iran and Iraq, given their myriad other heightened economic and political risks. In those two countries, the fiscal shocks are likely to be most severe and less easily absorbed. By contrast, Russia has built up substantial foreign-exchange reserves, it has a flexible exchange rate and an extremely strong and resilient fiscal position, with room to support the economy using fiscal and monetary stimuli – and its overall country risk score has shown resilience as a result. Finance minister Anton Siluanov refuses to fret, pointing out that Russia has a sovereign wealth fund topped up with last year’s budget surplus worth $157 billion (11% of GDP). This can be used to cover the budget gap in any crisis for a period of four years, with $580 billion-worth of foreign-exchange reserves available to cover a decade of low oil prices.
  • The oil price shock, who's most vulnerable? Council on Foreign Relations, two weeks old, March 19, 2020. This article introduces a new concept: the external breakeven price is hte price of oil required for a country to balance its external accounts.
One would assume Prince MBS needs to pay off foreign creditors before paying off the 15,000 Saudi princes. Prince MBS needs Brent at about $54/bbl to pay foreign creditors. At $54/bbl, he can pay foreign creditors, but he has nothing for himself or his own country (on a cash flow basis) -- assuming I understand this correctly. The delta between $54/bbl and the oft-quoted $83/bbl is the amount needed to run the country and provide the lifestyle to which he and the 15,000 princes have grown accustomed.

Notes From All Over, Late Afternoon Edition -- April 2, 2020

Metrics: in addition to all the metrics we're already watching, these are the two key metrics I'm following for progress with regard to these two issues:
  • global oil, supply and demand, price: Canadian dollar
  • Wuhan flu: number of patients treated on the US Navy hospital ships berthed in NYC and in Los Angeles
Committees, US House Un-American Committee rises once again --
Breitbart is posting that the US House and Nancy Pelosi have formed a new committee -- things we need to do to keep America's mind off Joe Biden. The committee's chairwoman has a different name for that committee but that's the purpose of the committee. Check out Breitbart to learn more. Google-owned "blogger.app" will not allow links to Breitbart.
Walgreens: a huge shoutout to the customer service folks at Walgreens.com.
There was a "systemic" problem with their photo.com website. I was on chat.online for a bit of time yesterday; once we jointly worked out the problem and the solution, I was told chat.online did not have the "authority" to do what was needed. I needed to telephone customer service. 
The menu was very short; the recording said "hold times" were longer than usual. In fact, I was connected with a real human within two minutes. The customer service person was unaware of this problem, and I led her through the steps that needed to be taken, and voila, she was willing to work with me. Problem solved. I was very, very impressed. Huge shoutout to Walgreens. Is is Walgreen, Walgreens, Walgreen's or something else? Google maps calls it Walgreens, so that's what I will do -- assuming I remember.
TCM: wow, I thought I was the only watching TCM. LOL -- see this note over at PowerLine today. I did not care for TCM's line-up last night so I watched the Coen Bros No Country For Old Men. A superb movie that ages very well.

Slow cooking: I got such a kick out of the pulled pork recipe a reader sent me that when a neighbor suggested "Mississippi Roast," I immediately looked up the recipe. It's cooking now and smells delicious.

Texas schools, K-12: it's not official or announced yet, but the tea leaves suggest the Texas governor will close all public K-12 schools for the remainder of the year. Most feel that the majority of "kids" will learn more at home at this point anyway. Going back to school now would entail all kinds of restrictions, inefficiencies. etc.

April Fool's joke: the best April Fool's joke that had many families in our area absolutely discombobulated -- trying to figure how this was going to play out. One of our dearest friends either photo-shopped it herself or found the photo-shopped graphic and sent it to every e-mail address she had, including "public" social media sites, such as nextdoor.com. The background was of Fox News, with this crawler: "Texas governor will have have all K-12 students repeat the entire 2019 - 2020 school year." From the reaction I heard nearby, it sounds as if most folks fell for this practical joke.

Space holder -- yup, a space holder. I assume there will be more news yet today.

CLR With SIx New Gibb Permits In Beaver Lodge -- April 2, 2020

Trump, US company oil CEOs: this is really, really cool. Trump is meeting with CEOs of select oil companies today and discussing global oil situation with Prince MBS.
At the end of the meeting, Trump will be able to tell "us" how much the oil companies plan to cut production. The decision by the individual oil companies will be a business decision; it won't be mandated by anyone. But US production will decline. Forget about the whys and wherefores -- it doesn't matter. Not for this part of the discussion. Collectively, the US might actually cut production by one to two million bbls of oil. That will be enough for Saudi to "save face" and at least say, "okay, let's think about that," and wait to see Russia's response. I'm not optimistic/pessimistic one way or the other on this; I just think it's fascinating to watch a president whose background is business / making deals and watching the process.
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Back to the Bakken

Active rigs:

$25.034/2/202004/02/201904/02/201804/02/201704/02/2016
Active Rigs4365605029

Six new permits, #37485 - #37489, inclusive --
  • Operator: CLR
  • Field: Beaver Lodge (Williams County -- east section line is county line with Mountrail County)
  • Comments:
    • CLR has permits for a 6-well Gibb pad in SENE section 24-156-95, Beaver Lodge oil field;
Three permits renewed:
  • CLR (2): one Jersey FIU and one Jersey well, both in Mountrail County, both in SENE 6-153-93;
  • Enerplus: one Morgan permit in Dunn County;
Five producing wells (DUCs) reported as completed:
  • 35690, F/NC, BR, Tailgunner 1E MBH, North Fork, no production data,
  • 35688, F/NC, BR, Tailgunner 1C MBH, North Fork, no production data,
  • 35437, F/NC, Hess, GO-Elvin Garfield-LE-156-97-1918H-1, Dollar Joe, t--; cum 57K 2/20; see below;
  • 35689, F/A, BR, Tailgunner 1D TFH, North Fork, t--; cum --;
  • 35439, F/drl, Hess, GO-Elvin Garfield-156-97-1918H-7, Dollar Joe, t--; cum 20K over26 days; see below;
Thirteen wells approved for "confidential" status:
  • Hess (8): two TI-State wells in Mountrail County; four AN-Mogen Trust wells in McKenzie County; two GO-Dahl wells in Williams County;
  • Whiting (5): three Iverson wells, and, one Janet Adele well, all in Mountrail County; one Berg Trust Federal well in McKenzie County;
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CLR's Gibb Pad (see above)

There is only one other well in this drilling unit:
  • 24352, 287, CLR, Gibb 1-24H, 30 stages,3 million lbs, Beaver Lodge, t3/13; cum 137K 2/20; 
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DUCs Reported As Completed (from above)

35439, F/drl, Hess, GO-Elvin Garfield-156-97-1918H-7, Dollar Joe, t--; cum 20K over26 days; fracked 11/12/19 - 11/20/19; 7.3 million gallons of water; 87.7% water by mass; friction reducer, 0.08091 (on the high side, perhaps the highest I've seen since beginning to track this -- until I saw the one below);
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN2-202000730000
BAKKEN1-202016993010028467312098920712277
BAKKEN12-20191097669595269651538115229152


35437, F/NC, Hess, GO-Elvin Garfield-LE-156-97-1918H-1, 33-105-04966, Dollar Joe, t--; cum 57K 2/20; fracked 10/31/19 - 11/10/19; 7.1 million gallons of water; 87% water by mass; friction reducer, 0.28783, no typo; highest I've even by several factors)

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN2-2020292268622667240614185241677175
BAKKEN1-2020303441034157442186337762542835
BAKKEN12-20190000000

Another Look At EOG's Liberty LR Well, #33432 -- April 2, 2020

Disclaimer: in a long note like this there will be content and typographical errors. If this is important to you, go to the source.

That have been several posts regarding this well. Links here: pending.
The well came off confidential list today:
  • 33432, 1,730, EOG, Liberty LR 43-1109H, 33-061-04028, 60 stages, 22.96 million lbs of 100 mesh sand; Parshall, t10/19; cum 131K 1/20; 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN2-202029175471754936376777474360
BAKKEN1-202031188571880638368391935621
BAKKEN12-201931241202415448026888685657
BAKKEN11-20193029199293216148413451118061301
BAKKEN10-20193140783403699485925455234631635

Four wells on this pad:
  • 33432: came off confidential list today;
  • 33433: producing,
  • 23958: producing,
  • 33434: permit only (loc)
Total wells with some percent in this section: not less than twelve (?), so far, and still plenty of drilling locations remain.

Fracking: let's check FracFocus vs actual frack data supplied by NDIC/EOG:
  • FracFocus: 14.8 million gallons of waters; 84.2% water by mass = works out to 23,411,772 pounds of proppant not including water
  • NDIC/EOG: 22.96 million lbs of 100 mesh sand
    • pretty close for back-of-the-envelope
    • around 500,000 lbs of non-sand, non-water proppant
Neighboring wells:
  • 20038, 625, EOG, Liberty LR 12-11H, Parshall, t4/12; cum 268K 1/20; no halo effect;
  • 20037, 790, EOG, Liberty LR 17-11H, Parshall, t6/11; cum 356K 1/20; small halo effect (from 2,000 bbls/month to 4,000 bbls/month;
  • 18101, 209, EOG, Liberty 2-11H, Parshall, t12/09; cum 218K 1/20; no halo effect; was off line for almost a year; back on line as of 1/20; production rate held steady;
Wow, I wish I could post another data point about this well but I can't confirm it, it's beyond my understanding of what goes on in the oil patch, and it's a trivial data point anyway.

Wow, Who Saw This Coming? -- Keystone XL Update -- April 2, 2020

Alberta -- the province -- just stepped up to the plate! Backs Keystone XL. Puts money where it's mouth is -- link here -- Alberta, Canada:
  • a $1.1 billion investment in the Keystone XL pipeline;
  • a $4.2 billion loan guarantee
  • both to help TC Energy Corp build the line to the US Gulf of Mexico
  • Calgary-based pipeline company
  • The move to start construction now, when the crude market has crashed and the project still faces roadblocks in the U.S., shows how critical the fight for the oil industry’s survival has become in Alberta, home to the world’s third-largest crude reserves. The province’s benchmark crude is trading at a record low of $4.09 a barrel.
Milk in my neighborhood grocery story is selling for $4.99 half gallon ($419.16/bbl?).

1Q20 - Cable News Viewership

Updates

Later, 8:36 a.m. CT: huge correction made below; a reader caught the error. Thank you. When I die (perhaps of coronavirus) and this blog is shut down (or taken over by Sophia), the ending credits to the success of this blog will have to include a handful of readers, for catching my errors. LOL.
But look at that. I did not know. Fox News -- almost twenty years as the most-watched cable news network in total-day and primetime.
And with the recent surge, it's hard to believe Fox News dominance will change any time soon. I've always wondered why the mainstream media is so vocal and so negative about Fox News. It now makes sense.
It also explains why President Trump generally goes there first to reach out to the American public. It's all about viewership.
Original Post 

Data points, 1Q20 cable news results, according to Nielsen Media Research:
  • Fox News set network records for total-day and primetime viewership
    • this was the network's 15th straight quarter as the most-watched network in cable
    • 73rd quarter (almost 20 years -- 18.25 years to be exact) as the most-watched cable news network in total-day and primetime
  • But this is what is most impressive:
    • these numbers represent a whopping 38% increase over total viewership one year earlier (1Q19)
  • CNN also saw a considerable gain: up 29% --but it was coming from a very, very low viewership to begin with
  • MSBNC: also grew, but only a 1% increase from 1Q19
    • slipped 1% in demo viewership
  • demo viewership:
    • Fox News gained 42% (and already very, very high viewership)
    • CNN gained 27% (coming from a low base)
    • MSNBC: slipped 1%
  • Fox News dominated everywhere
    • claimed 13 of the top 15 cable news programs
    • claimed all of the top five
      • Hannity: first (my least favorite of those I've seen)
      • Tucker: second (my personal favorite but can count the times I've watched him on two hands)
      • The Five: third
      • The Ingraham Angle: fourth (I sort of enjoy it, perhaps better than Tucker; again, seldom watch)
      • Special Report with Bret Baier: fifth (years ago, I watched it often; haven't watched him in years)
  • most amazing: Fox Business Network -- a paltry 173,000 viewers
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Compound Eyes


First Time Unemployment Claims -- Doubled The Consensus Midpoint -- Again, Analysts Way Off -- April 2, 2020

Jobs: link here -
  • prior: 3.283 million
  • revised: 3.307 million (revised upward)
  • consensus: 2 million to 4.5 million (mid-point: 3.25 million)
  • actual: 6.648 million
  • analysis: this tells me analysts are underestimating how bad this is
Canadian dollar: dropped overnight to 68 cents US but since then recovered a bit.

Gas Buddy, Oklahoma City: one station at 98 cents/gallon.

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Back to the Bakken

Active rigs:

$22.474/2/202004/02/201904/02/201804/02/201704/02/2016
Active Rigs4365605029

RBN Energy: why US LPG exporters are losing their edge in Asia.
If Saudi Arabia and Russia flood the world with their crude oil in the midst of a global demand crisis, it would have impacts and implications far beyond crude. A ramp-up in Saudi and Russian oil production this spring would also increase their output of associated gas and NGLs. At the same time, the opposite will be happening in the Permian and other liquids-rich U.S. shale plays, where producers, stunned by sub-$25/bbl oil prices, already are pulling back on drilling and later this year will see their oil and NGL production gradually level off and eventually decline. All this is already turning the international LPG market on its head — just last week, U.S. propane exports plummeted by nearly 40% versus the prior week, to only 889 Mb/d. Today, we consider recent extraordinary market developments and their effect on the arb between Mont Belvieu and Far East LPG prices.
Only one well coming off the confidential list today --  Thursday, April 2, 2020: 3 for the month; 3 for the quarter, 258 for the year:
  • 33432, 1,730, EOG, Liberty LR 43-1109H, 33-061-04028, 60 stages, 22.96 million lbs of 100 mesh sand; Parshall, t10/19; cum 131K 1/20;
*********************************
Saturn Has Rings


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Mississippi Roast

Link here.

Wednesday, April 1, 2020

Hopefully I Won't Regret Posting This -- April 1, 2020

I'm heading to bed so I won't see e-mail / comments until tomorrow. I might regret writing this, and it's against my better judgement to post this and then go to bed without thinking about it for awhile.

But, here I go.

We're well past the discussion of whether we're headed into a recession -- from my vantage point, it's much worse than that. I've been suggesting that for awhile but a note -- received just moments ago -- from a reader puts things in perspective.

Before reading the comments from that reader, think back to 1992 and how much has changed since then and how much economic growth the US has seen since 1992.

Now, having given that a moment's thought, read these comments from a very, very knowledgeable reader:
Just a few records & benchmarks hit this week:
Oil inventories up the most since October 2016; refinery utilization lowest since Hurricane Harvey; gasoline production lowest in 22 years; gasoline demand lowest since February 1992, and the biggest one week demand drop ever ...
Oh, and that crude oil in storage now near the five-year average for this time of year; it's also about 30% above the prior five-year average (i.e., 2010 to 2014) ... we've now had five fat years.
We haven't seen numbers like this since 1992. Let that sink in.

Now, think about it again, tomorrow morning, 8:30 a.m. CT, when we get the first time unemployment claims numbers.

And the media is hung up on the number of ventilators available and whether two US Navy hospital ships arrive in port on time.

About two weeks ago we were told that every airline would be "broke" by the end of April.

Bedtime reading.

First Of The Month -- January, 2020, Data Being Reported

This is a reminder for me. Some of these data bases have posted January, 2020, data. Others are still showing December, 2019, data as the most recent data available. 

Word for the day: pangolin. 

Links:
Thursday:

Friday:


Next week:
  • atmospheric CO2

Love Him Or Hate Him, He Never Fails To Take An Issue Head-On -- April 1, 2020

Updates

Later, 10:46 p.m. CT: this is why I love the blog. In the original post, I wrote:
This is a most interesting poll. The results are interesting but that's not the most interesting part. See if you can guess what I think is most interesting about this poll. Link here. Don't write me with your thoughts. My answer "at eleven."
Well, it's almost eleven. This is what I find most interesting. People are starting to go crazy -- see this story --  and this is just April 1. It's not even April 2, and the "national lock down" has been extended to the end of April / early May. "We" will be lucky to get to mid-April. And if we do, it will still be another two weeks.

Here in the local area, we've already seen signs of civil disobedience -- and we live in a very, very upscale, law-abiding, quiet area of Grapevine, TX. And it looks like the calm, quiet, law-abiding citizens are already upset with the city council and the local police going a bit too far in trying to keep people locked up -- even though there is no "stay-at-home" order. Yet.

Yes, this is going to get very interesting very fast. You can only push people so far.

[Later: just after posting the above, I checked PowerLine, and there it is, another example: people turning on people in France. Earlier I said to myself, the president suggests that we will be in lock down at least until May 3. I 'm doubting we will get to mid-April. What I need to hear is a game plan, a strategy for getting back to work. I've not heard that game plan, that strategy from anyone. If the CDC had its way, we would be in lock down until June, 2021.]

Original Post

How many American lives did he just save?

We'll never know, will we?


This is a most interesting poll. The results are interesting but that's not the most interesting part. See if you can guess what I think is most interesting about this poll. Link here. Don't write me with your thoughts. My answer "at eleven."

Gasoline demand:


See Rasmussen poll above.

Cable news wrap: link here.



The first quarter of 2020 was filled to the brim with news, from the impeachment trial of President Trump and the contentious Democratic primary to the growing coronavirus pandemic, but MSNBC failed to add viewers, and experts say that's a serious issue for the far-left network.
Fox News grew 38 percent among total viewers during the first quarter of 2020 compared to the same time period last year, and MSNBC's liberal rival CNN grew 26 percent, while MSNBC finished the quarter with roughly the same viewership as Q1 of 2019.
It was even worse for MSNBC when it comes to the key news demographic of adults age 25-54, as Fox News grew 42 percent and CNN grew 27 percent, while MSNBC dropped by one percentlosing viewers during, arguably, the most newsworthy quarter in a decade.
I didn't really think about the cable news network story and had not planned to post it until I looked at MSNBC's flagship. See link.