Saturday, January 31, 2015

Surrealistic Times; It's Time To Give Greece A Break -- Bloomberg -- January 31, 2015

Some data points and observations from the past week:
All that talk about how severe this year's flu season has been. The data suggests something entirely different (source):

Yes, this year's flu season is pretty much over. And yet stories like this:
Some new evidence this is a particularly bad flu season: Flu-related hospitalizations of the elderly are the highest since the government started tracking that statistic nine years ago.
Perhaps with ObamaCare more folks are seeking care; doctors get better reimbursement to admit. Hospitalization data as a single data point is about as worthless as a rig count is as a single data point to tell us how the Bakken is doing. But it's great copy to sell newspapers. But this year's flu season is winding down. Thirty-second sound bite: spiked late; petered out quickly.

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Update: I'm not the only who thinks the unemployment rate of 5.6% is a lie. Gallup poll:
There's no other way to say this. The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployed, amounts to a Big Lie.
Original blurb
 
Jobs: first time claims plunge; 15-year low; and nary a word from the mainstream media; media knows the data does not jibe with lay-off announcements; and, "everyone" knows the 5.6% unemployment rate is a lie if 4% is considered full employment in the US -- in fact with a) the technology revolution in the past 20 years; and, b) the social safety net, one can argue that 6% is full employment; Janet Yellen should use 6% or 7% as the new benchmark for "full employment" and move on. Stick a fork in it. It's as good as it's going to get.

4Q14 GDP: an unremarkable (at best) 2.6%. Just one quarter earlier (3Q14), the GDP was 5.0%. Again, nary a word in the mainstream media about this incredibly anemic recovery

Israeli-US relationship: may be at its lowest point ever; Obama, worse negotiator ever? Agrees to 80% of Iran's demands;

Europe (EU):
As long as it's "other people's money." But I about burst out laughing when I turned the page and saw the headline: "It's time to give Greece a break." Wow.
Measles endemic? Follow-up to the mysterious viral disease that came out of Guatemala in 2014? No serious investigative reporting? Anyone with half a brain that gives even thirty seconds of thought to these two quasi-under-reported-epidemics will know what's going on.

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Peak Oil

Confused about "peak oil"? You are not alone. I was surprised this week to see just how confused some folks are regarding the definition of "peak oil" as defined by M. King Hubbert. Two key quotes from wiki that "define" Hubbert's theory:
Peak oil, an event based on M. King Hubbert's theory, is the point in time when the maximum rate of extraction of petroleum is reached, after which the rate of production is expected to enter terminal decline.
By observing past discoveries and production levels, and predicting future discovery trends, Hubbert used statistical modelling in 1956 to accurately predict that United States oil production would peak between 1965 and 1971.
Wiki says Hubbert "accurately" predicted that US oil production would peak between 1965 and 1971.

Looking at recent trends one could argue that "the jury is still out."



There were two parts of Hubbert's theory (the following are direct quotes):
  • a point in time would occur when the maximum rate of extraction of petroleum is reached; and,
  • after that point in time, the rate of production is expected to enter terminal decline
With regard to the second point: the rate of production did not enter terminal decline after 1971. Fast forward to 2011 -- clearly the trend does not suggest the US has entered a period of terminal decline (I'm reminded of Mark Twain's comment about premature news reports of his death).

Now, back to the first point in Hubbert's theory:
  • a point in time would occur when the maximum rate of extraction of petroleum is reached
It was just pointed out that it looks like the fastest rate of production did not occur in 1971 as wiki suggests, but in fact, we saw a much faster rate of production from 2011 to 2013. I assume the rate will be similar form 2013 to 2014 though that may not be true in calendar year 2015.

Remember, rate = "rise over run" = change in degree over change in time = change in production of crude oil over change in time. 

I think it's pretty common sense to say that in any given oil field, or in any given country, or in any given region, or in any given planet, there will come a time when the rate of crude oil production will be reached. Predicting when is a fool's game. Clearly, that point has not been reached in the US or in North America.

We won't even go into another area of confusion noted by wiki: peak oil is often confused with oil depletion; peak oil is the point of maximum production, while depletion refers to a period of falling reserves and supply.

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I was reminded of "all that" (Hubbert, peak oil theory) after reading the article at this link. I couldn't follow the argument the writer was trying to make (granted, I was watching The Big Lebowski when a reader sent me the link to the article). When confused, I look at the URL, and in this case, it's a "Peak Oil" blog. That explains everything. I'm not sure what definition of "peak oil" the folks at that link are using, but clearly ... well, what can I say?

By the way, when I read the following sentence at the same wiki source on "peak oil" ...
The same theory has also been applied to other limited-resource production-domains, such as minerals, lumber, and fresh water.
... I was reminded of another great scholar: Thomas Robert Malthus.

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Not Much Left Of ObamaCare
No Wonder The GOP Is Ignoring The Law

There are three legs to the ObamaCare stool:
  • the tax on medical devices
  • the corporate mandate
  • the personal mandate
With President Obama about ready to defer, waive, or expand exemptions to the personal mandate, it looks like the only leg still "standing" is the tax on medical devices, and I think that provision was watered down.

Meanwhile in California, the ObamaCare train wreck in full color. The Los Angeles Times is reporting:
California's ambitious effort to save billions of dollars by changing how the state's costliest patients get treated is on the ropes.
The Obamacare program was designed to reduce medical costs by putting more of the nation's 11 million most challenging and expensive patients into tightly managed care.
But the rollout in California — one of the first states spearheading the effort — has been marred by widespread confusion, enrollment glitches and a revolving door of health officials. Sixty percent of eligible patients have rejected the program, and state leaders are demanding to see financial savings in a year.
Most of the patients suffer from multiple chronic conditions, such as diabetes and Alzheimer's. They range from younger, disabled adults to older Americans in nursing homes. Nationwide, some $300 billion is spent annually on these patients who qualify for both Medicare and Medicaid.
State leaders are demanding to see financial savings in a year. State leaders? They are all Dems who thought up this crazy scheme. 
California's program, known as MediConnect, calls for turning about 450,000 of the state's 1.2 million dual-eligible patients over to HMOs run by Anthem, Health Net and other insurers. The prospect of increased profits from taking on the poorest, sickest patients has captivated Wall Street and sent company shares soaring.
But the rollout has been far rockier than expected and raised concerns about the state's approach.
"These numbers are falling far below what the state was hoping for, and it puts pressure on them to increase enrollment rates," said Kathryn Kietzman, an expert on this population and a UCLA health-policy researcher. "The stakes are high for California, and these changes are potentially a big deal nationally if they can get it right."
Much, much more at the link and it ain't pretty.

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Negative Mortgage Rates

I've always thought about buying a house in Yorkshire, England. This just might make it possible. No link; google it, if interested:
With negative interest rates in Germany, Switzerland, Ireland, Belgium and Denmark, it was about time that we saw negative mortgage rates in Europe as well. In January, as much as $3.6 trillion of debt in the Europe and Japan traded at negative yields. Unprecedented bond buying by the European Central Bank (ECB) and Bank of Japan (BOJ) has resulted in a manipulation of global capital markets that could result in another major asset bubble.

The situation has gotten so out of hand, that not only are interest rates -0.2% at the ECB’s overnight deposit facility, commercial banks are lending to individuals at negative rates as well. The ECB’s Mario Draghi may be biting off more than he can chew at this point (thank you Super Mario!). According to Finans.dk, mortgage rates are now negative in Denmark. The situation is so bizarre that Nordea Bank’s IT systems need to be reprogrammed as they are are not accustomed for situations where the bank is not receiving interest payments on outstanding mortgages.
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SNL Skit To Explain Greece's Debt Repayment Scheme

I don't watch television so I would have missed this. Don tells me it was a skit on Saturday Night Live:
Greece's economy minister said it would be better to link the country's debt repayments to its economic growth rate as it needs a feasible solution to bring its sovereign debt under control.
"At the moment, we spend around five percent of gross domestic product on servicing our debt. ...It would be better if we linked the repayment to growth: if growth is higher, we pay more, if it is lower, we pay less."
Lois Lerner and Al Sharpton would be co-chairmen of the International Debt Verification Committee To Make Sure Greece Pays Its Fair Share (IDVCTMSGPIFS) -- pronounced "idiots my foot."

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 A Note To The Granddaughters

I did not get out on my bicycle today due to all the family commitments. In addition to swimming and soccer, we now have band and ensemble competitions. So this evening, I went for a bike ride -- up to a Barnes and Noble 5.2 miles away from home.

It was raining and it is raining, so it will be a wet ride home. While riding here, I was quite surprised. A cowboy (I know he was a cowboy because he had a cowboy hat on and was driving a pick-up) stopped to ask me where I was going and offered to drive me there -- throw the bike in the pick-up bed and get a dry ride to Southlake. I declined. It wasn't raining that hard; it looked worse than it really was.

I don't know if I told this story. Years ago I was hitchhiking from Williston, North Dakota, to the East Coast, New York City, to be specific. Hitchhiking through urban areas are always the toughest. I was somewhere in Minneapolis about 8:00 p.m. when a pick-up truck stopped to pick me up. It was an old truck but when hitchhiking one generally doesn't turn down any rides.

We had not gotten very far when all of a sudden a fire erupted, or flames shot out of the dashboard somewhere -- I never saw a driver head to an interstate shoulder as fast as he did and jump out of a burning pickup. I jumped out also. Before the night was over, fire trucks on scene and one burned out pickup truck.

I remember sleeping over at the driver's house that night -- but I don't recall how we got from the torched pickup to his house. But I do remember a good night's sleep.

Which, for some reason, reminds me of this:


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North Dakota State Senator Proposing "Quick Take" Provision (Eminent Domain) To Allow Oil Industry The Needed Pipeilne Easements They Desire -- January 31, 2015

The Dickinson Press is reporting that Senator Sen. Jim Dotzenrod, D-Wyndmere, North Dakota, wants to use "eminent domain" to force surface owners to acquiesce to demands by oil industry for pipeline easements. Specifically the bill would:
  • recommend a constitutional amendment creating a “quick take” provision so that if 85 percent of easements have been obtained, the operator may obtain immediate access to the remaining non-consenting landowners’ property
At least that's what I take away from the story, but there's a lot more to it, and I may have misread it. If this is important to you, go to the linked article. 

The provision is part of the a bill addressing the flaring issue in the Bakken. I'm being told that "eminent domain" is a non-starter on the Fort Berthold Indian Reservation (as in "not lawful") and that's where the majority of the flaring problem resides in the North Dakota Bakken.

I like the "quick take" verbiage. That will get someone's attention. LOL. Starting to sound like Chicago politics.

Gotcha! There Goes Your Tax Refund -- ObamaCare -- TrainWreck -- Administration Will Expand Exemptions -- January 31, 2015

It should be noted that this story broke on Super Bowl weekend when no one was paying attention and by next week it will be old news.

The New York Times is reporting.
Obama administration officials and other supporters of the Affordable Care Act say they worry that the tax-filing season will generate new anger as uninsured consumers learn that they must pay tax penalties and as many people struggle with complex forms needed to justify tax credits they received in 2014 to pay for health insurance.
The White House has already granted some exemptions and is considering more to avoid a political firestorm. Mark J. Mazur, the assistant Treasury secretary for tax policy, said up to six million taxpayers would have to “pay a fee this year because they made a choice not to obtain health care coverage that they could have afforded.”
But Christine Speidel, a tax lawyer at Vermont Legal Aid, said: “A lot of people do not feel that health insurance plans in the marketplace were affordable to them, even with subsidies. Some went without coverage and will therefore be subject to penalties.”
The penalties, approaching 1 percent of income for some households, are supposed to be paid with income taxes due April 15. In addition, officials said, many people with subsidized coverage purchased through the new public insurance exchanges will need to repay some of the subsidies because they received more than they were entitled to. 
All those folks looking forward to income tax refunds aren't going to be happy. The interesting thing: we're talking about a handful of people in the big scheme of things, but they are going to be very, very vocal when they don't get their income tax refund.

Looks like ObamaCare will be deferred, waived, whatever for another year. I doubt the middle class will get any of those tax breaks. 

Joe Biden can probably explain this better than I can.

Week 4: January 25, 2015 -- January 31, 2015

Slump in oil prices
Articles tracked here 
Hess to spend 18% less in 2015 in the Bakken; another article here
North Dakota rig count of interest to Reuters analyst
Permits canceled; producers abandoned
Permits, wells possibly affected by slump in oil prices
A reader's perspective on the Bakken in light of plummeting oil prices
The US is the new "swing producer"

Operations
Random update of projected number of 2015 oil and gas permits in North Dakota
EOG reports two huge wells
American Eagle sells non-core acreage in Divide County

Pipelines
Random update on Enbridge Clipper

Bakken economy
Legislature considering $1.1 billion infrastructure package for the oil patch
Fargo riding the Bakken crest
Williston Wire's top ten stories of 2014

Bakken 101
Four Zavanna wells and spacing

Friday, January 30, 2015

Calling It A Night -- But A Nice Essay -- Rigzone -- Janaury 30, 2014

From Rigzone, the conversation begins:
The crude oil price erosion that began in the summer of 2014 is generating a variety of perspectives from analysts following the industry, including two Rice University analysts who talked to Rigzone about the dynamics behind the dizzying drop in prices, and what lies ahead.
The Saudi factor:
Rigzone: Is the downturn anyone’s “fault?”
Arnold: The way I see it is that the United States is the country that’s been increasing production dramatically. Saudi has been maintaining markets, which is not an unreasonable thing for a sophisticated player to do. But they haven’t been dumping on the market, nor have they decided to cut their own production, knowing that OPEC has a history of cheating by their partners. Another thing that’s been in the back of my mind is that there used to be a close relationship between the Saudis and Washington, and through different administrations. I think the Saudis were very mindful of the impact of their actions in the United States in the last couple of decades. And now, you just don’t get the feeling that there’s the sensitivity about that relationship that there had been historically.
Swing supplier. 
Rigzone: The term “swing supplier” has come up more in recent weeks. What is that about?
Krane: Traditionally, the swing supplier in the market has been OPEC, and mainly Saudi Arabia. When there was too much supply or too much production, and the market became flooded with crude oil, prices would start to drop, and OPEC would take some of that production off the market. OPEC could add supply to the market or take supply off the market, as conditions warranted. But the advent of U.S. shale production has kind of interrupted that process. Historically, oil production from non-OPEC countries was not a problem for OPEC because it did not increase quickly enough to threaten Saudi Arabia’s market share. Total production has overwhelmed global demand with the sudden and significant increase in production from the United States amid the fracking boom. Not wishing to give up market share to the United States and North America, OPEC responded in a new way – by not decreasing production.
Caught off guard?
Rigzone: Some analysts have suggested that perhaps OPEC did not intend for prices to fall this much, or this quickly.
Krane: While OPEC acted to weaken crude oil prices, they probably overshot the mark on the way down. OPEC opened the taps, letting more crude oil into the market to lower prices. However, there could have been an overreaction, given how far prices have fallen. By the end of the year, prices might reasonably be expected to be back up in the $70s/barrel, barring a serious geopolitical event. The big change is on this side of the globe, and that’s where production is going to have to fall so markets are balanced again. It’s a rational and reasonable course of action – or inaction – for OPEC. They don’t want to see someone else take their market share. They will have some short-term pain because they won’t have the same revenue from oil, but that’s the price they’re going to have to pay to maintain their share of the market.

Update On North Dakota Plan To Press Ahead With Infrastructure Projects This Summer -- January 30, 2015

Bakken.com is reporting:
North Dakota’s Senate has approved $1.1 billion in special funding so that infrastructure projects can begin by this summer.
Senators voted 44-2 Thursday to approve the “surge funding” bill that would fast-track funding to cities, school districts and communities affected by North Dakota’s exploding growth.
Very, very timely. "Funny" how things work out.

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Not Lost In Translation

Reuters is reporting:
Greece's finance minister said the government would not cooperate with the European Union and International Monetary Fund mission. 
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What Is This Telling Us?

Reuters is reporting:
Shares of Shake Shack Inc more than doubled on Friday, putting a nearly $2 billion price tag on the small cult hamburger chain, in a huge bet that its growth can match top performers in the crowded "fast-casual" dining space. 
Shake Shack's debut is the latest in a string of blockbuster IPOs from trendy restaurant chains that cater to younger and more affluent diners willing to pay a bit more for fresher and higher quality food. Growth-hungry investors are hoping to replicate the red-hot run of industry darling Chipotle Mexican Grill.
But Shake Shack's own CEO Randy Garutti cast doubt on whether it will do so, calling the chain known for decadent milkshakes and hormone- and antibiotic-free burgers a "very measured growth company."
This was also a major story on ABC News, Friday evening, noting that Shake Shack hamburgers -- just the hamburgers --  cost $5.19. It was also noted that the fast food hamburger industry is now twice the size of the fast food pizza industry.

Some observations:
  • red meat; hamburgers; fast food; there has been a big push for the past seven years, and perhaps the last twenty years for healthier food, and red meat/hamburger is now bigger than ever
  • one can buy a value-meal hamburger for a buck at McDonalds (a company that is doing badly, sacks their CEO), and yet premium hamburgers at high prices are all the rage; there's a lot of folks out there willing to spend big money on premium hamburger; $5.19 is just the hamburger -- add in $2.50 fries, $2.50 drink and we're talking a $10 hamburger meal
  • makes Omaha Steak hamburgers a bargain; twenty years ago Omaha Steak offerings were seen as high end; and now I love Omaha Steak products (in fact, I have a Omaha Steak filet mignon on the grill now, while watching The Big Lebowski again)
Or, more succinctly:
  • home delivery: pizza; dining out: hamburger 
  • healthy food fad is just that ... a fad
  • the economy is doing a lot better than folks think .... willing to spend $5.19/hamburger
When we were in Boston off and on for the past four years taking care of our granddaughters, I was amazed at all the hamburger restaurants, especially so many on Harvard Square, and they don't even have an In-N-Out there, nor a Whataburger.

    Gutterballs, The Big Lebowski

    Julianne Moore is ... well judge for yourself.

    Biblical themes and tropes in The Big Lebowski

    A Very, Very Short Daily Activity Report Today -- January 30, 2015

    Active rigs:


    1/30/201501/30/201401/30/201301/30/201201/30/2011
    Active Rigs146190186204163

    Wells coming off the confidential list were posted earlier; see sidebar at the right.

    Five (5) new permits:
    • Operators: Sinclair (2), Slawson, Hunt, XTO
    • Fields: Sanish (Mountrail), Robinson Lake (Mountrail), Big Bend (Mountrail), Parshall (Mountrail), Midway (Williams)
    • Comments:
    One permit was canceled:
    • 18813, PNC, KOG, Sorenson Federal 4-9H,

    Random Look At US Crude Oil Imports Over Recent Six Months -- January 30, 2015

    The data is a full two months old so it's not particularly helpful. We really won't know what the slump in oil price was all about and what the results were until late this summer, maybe not until the end of the year when we have the August "high-driving" data in.

    Having said that, it's interesting to look at recent history.

    October 1, 2014, was the beginning of the slump in oil prices.

    With that date in mind, look at the numbers. These are the millions of bbls of oil imported into the US broken down by country.



    Despite the increasing amount of oil produced INSIDE the United States, the amount of oil imported
     into the US -- between June, 2014, and November, 2014, actually increased, from 264 million bbls to 269 million bbls/month. Interesting, huh?

    Saudi Arabia worried about losing its fair share? For the US, no change: 30 million bbls/month.

    Venezuela on the ropes? For the US, Venezuela actually shipped MORE oil into the US, from 22 million bbls/month to 24 million bbls/month.

    So, who were the losers?
    • Iraq went from 16 million to 13 million bbls.
    • Kuwait went from 11 million to less than 4 million bbls.
    • Although they don't account for much American imports, Algeria and Nigeria took major hits.
    Again, I don't think this snapshot tells us much. It's too brief a period; the data is two months old; and, the price slump had just begun.

    I don't think we will have a better feeling for all this until late 2015. At the end of October we will have the results of the high-driving month of August. Should be interesting.

    Source of screenshot above: EIA, a dynamic link.

    Something Surprising From CNBC: Lousy Economic Recovery Under Current Administration -- January 30, 2015

    From CNBC, something we would not have seen if the president were up for re-election:
    After a deep recession, Ronald Reagan posted 4.7 percent annual growth over 22 quarters and employment jumped 13 percent, whereas President Obama's recovery has accomplished half that progress. 
    "Half that progress...." Has employment under this administration come anywhere close to jumping 13%. I don't know. The numbers don't make sense to me any more.

    Even the vice president agrees: "the past six years have been really, really hard on this country."

    And that's despite a gazillion dollars in various stimulus programs including Solyndra and wind energy tax credits. I guess killing the Keystone pretty much set the tone for the Obama administration's feeling about the blue collar set. Wall Street has done very, very well, and with the Yellen/Fed announcement yesterday, it looks like Wall Street will keep doing well -- at least for another year. The only fly in the ointment: the energy sector. Note to investors with long horizons: not to worry.

    See disclaimer.

    Speaking of politics, let's turn to another waste management issue.

    I don't know if it's just me but there's something about a city like Phoenix hosting a "Waste Management" tournament. That seems better suited for Washington, DC. Be that as it may, for at least one golfer "Waste Management" probably lived up to its name. The leaderboard is too long for one screen shot, so the top nine and the bottom ten:



     It's still possible for Tiger to score better than Michael Hopper but it's going to be close.

    Saudi Arabia Crude Oil Imports -- US -- Monthly Update -- January 30, 2015


    See also today's update from Reuters

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    Amazon Killing It With Prime

    The other day a reader was happy with his investment with Amazon but concerned about the cost of Amazon Prime.

    My reply from yesterday:
    I order a lot of stuff from Amazon but have never paid for Prime shipping --I'm too cheap. But I have to admit, the more I use Amazon, the more I wonder about signing up for Prime Shipping -- my wife suggests that I do -- or wonders if I already have it....I think [Prime is] something that will continue to grow...people just get addicted to ordering from Amazon, and then at some point they start thinking shipping...
    ... and now today, from Yahoo!Finance:
    Don't act so surprised:  Amazon is killing it with Prime.
    Growth in Amazon Prime memberships propelled the etail giant to a profitable fourth quarter. That was after two consecutive quarters of steep losses. Last year, the company raised the Prime subscription fee to $99 from $79, but the number of subscribers grew anyway. Big time. An estimated 10 million new customers signed up over the holiday season alone.
    “I don’t know why anyone would be surprised that Prime customers actually not only did not flee the service when Amazon raised prices,” says Yahoo Finance’s Jeff Macke, “but they added 53% more Prime subscribers” in 2014.  The service provides free two-day shipping and video streaming.
    Those subscribers are doing some serious shopping. After paying the annual fee for the Prime service, Prime members are in turn spending a lot more on products on the site. There are about 40 million Amazon Prime members in the United States right now, and they spend about $1,500 a year. That’s according to new research out this week from Consumer Intelligence Research Partners. Non-Prime members spend about $625 over the course of the year.
    Earlier today I was checking my Amazon account (for a number of reasons). I noted that a package was delivered to my address two days ago. I had not seen it. Today, I went down to the apartment complex manager's office (again) and re-checked. And there it was; I had missed it when looking for it yesterday. A wonderful pleasant surprise. I have never had a bad experience Amazon. I was fully reimbursed for one product some time ago even though it was my error and I specifically told Amazon (and the third party seller not to reimburse me because it was my error, not theirs) but they reimbursed me 100%.

    I don't have Prime shipping. But it's getting harder and harder to resist. 

    CVX Surprise -- January 30, 2015; Illegals Slamming DMV Offices In California

    See disclaimer.

    Reporting today:

    Chevron (CVX): forecast, $1.64; beats; fourth-quarter net income of $3.47 billion, or $1.85 per share, compared with $4.93 billion, or $2.57 per share, a year earlier. Analysts on average had expected earnings of $1.63 per share the second-largest U.S. oil producer, reported a higher-than-expected quarterly profit on Friday as sales of chemicals, lubricants and other refined products helped offset plunging crude prices (CLc1).

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    This Will Warm The Cockles Of Ms Lynch's Heart

    CBSLocal is reporting:
    The Department of Motor Vehicles is so overwhelmed with requests for new driver’s licenses and vehicle registrations that it can take up to three months to get an appointment or a half-day wait in the lobby.
    The spokesman said the DMV is working to address the problems, but some people are having to take a day off of work to handle a 15-minute transaction. [It's worth the wait, believe me.]
    At the Hollywood DMV office, Jose Quiroz’s DMV ordeal spanned two days of waiting patiently with his family to have his license renewed.
    “Yesterday, I was here for four hours standing outside, and when I got to the front line they said that they were not taking us in no more,” Quiroz told Bryan. “And now I am back here again, because I am here to fix my license, and I have been here five or six hours.”
    One driver received a letter from the DMV on Jan. 6 that advised he had to renew in person at a DMV office but had until March 8 — two months — before his current license expired. The driver went online to make an appointment, but discovered there were no appointments available within 50 miles of his home before March 8.
    In fact, we found eight DMV offices, including Hollywood, Riverside, Costa Mesa, and Ventura that had nothing available before March 11, after his license would have expired.
    The wait for an appointment was even longer eight other DMV offices, including Thousand Oaks, Van Nuys and Torrance. They had no appointments available until April, more than three months away.
    Much more at the link. 

    NDIC Hearing Dockets Agenda For February Is Posted; Very, Very Short -- January 30, 2015

    Link here.

    Dockets are tracked here

    First run-through of the February, 2015, agenda; cases that caught my eye:
    • 23714, SHD, Van Hook and/or Heart Butte-Bakken, establish an overlapping 3520-acre unit, 27 wells; Dunn, McLean
    • 23715, SHD, Heart Butte-Bakken, establish a 1600-acre unit; 17 wells, Dunn
    • 23716, SHD, Heart Butte and Deep Water Creek Bay-Bakken, establish an overlapping 7520-acre unit; 2 wells, Dunn, McLean
    • 23717, SHD, Deep Water Creek Bay-Bakken, establish an overlapping 4000-acre unit, 3 wells; Dunn, McLean
    • 23728, CLR, Catwalk-Bakken, establish 2 overlapping 1600-acre units, 14 wells on each; establish an overlapping 3200-acre unit, 1 well, Williams
    • 23733, XTO, North Tobacco Garden-Bakken, establish a 1920-acre unit, 12 wells; McKenzie
    • 23734, XTO, Haystack Butte-Bakken, establish a 2560-acre unit, 16 wells, McKenzie
    • 23655, Whiting, Banks-Bakken, establish a 2560-acre unit, 28 wells, Williams, McKenzie
    • 23656, Whiting, Sand Creek-Bakken, establish a 1280-acre unit, 14 wells on that new unit, plus 14 wells on an existing 1280-acre unit; McKenzie
    Much of the rest had to do with:
    • overlapping 2560-acre units; 2 wells
    • flaring (three cases only)
    • pooling
    • continuation cases
    Comment: two wells on a 7520-acre unit is unitization by another name. 

    Full Agenda

    Wednesday, February 25, 2015 


    23641, CLR, revoke a Statoil permit, #30430, Jack 21-16 8TFH, Williams
    23642, CLR, revoke a Statoil permit, #30432, Jack 21-16 2H, Williams
    23643, CLR, revoke a Statoil permit, #30428, Jack 21-16 3TFH, Williams
    22803, cont'd, CLR, revoke a Crescent Point Energy permit, #24719, Go-Riders 158099-1522H, Williams
    23644, XTO, McGregor-Bakken, amend, establish an overlapping 1280-acre unit; 2 wells; Williams
    23645, Missouri River Resources, Squaw Creek-Bakken, 4 wells in a 320-acre unit McKenzie
    23646, Clearwater, treating plant, throughout the state
    23647, Water Services, treating plant, throughout the state
    23648, Horizon-Olson, LLC, treating plan, Dunn
    23649, Resonance Exploration, temporary spacing, Bottineau
    22597, cont'd
    22640, cont'd
    22641, cont'd
    23650, Slawson, Pleasant Hill-Bakken, proper spacing, McKenzie
    23651, Whiting, Fryburg-Bakken, proper spacing, Billings
    23652, Whiting, Grinnell-Bakken, establish an overlapping 2560-acre unit; 2 wells, Williams, McKenzie
    23653, Whiting, Sand Creek and/or Grinnell-Bakken, establish 3 overlapping 2560-acre units; 2 wells, Williams, McKenzie
    23654, Whiting, Banks, Truax, Grinnell, and/or Sand Creek-Bakken, establish 7 overlapping 2560-acres units; 2 wells each, Williams, McKenzie
    23655, Whiting, Banks-Bakken, establish a 2560-acre unit, 28 wells, Williams, McKenzie
    23656, Whiting, Sand Creek-Bakken, establish a 1280-acre unit, 14 wells on that new unit, plus 14 wells on an existing 1280-acre unit; McKenzie
    23657, Whiting, Poe, Banks and/or Camp-Bakken, establish 2 overlapping 2560-acre units, 2 wells each; McKenzie
    23658, Whiting, Poe-Bakken, establish 3 overlapping 2560-acre units; 2 wells each, McKenzie
    23659, Whiting, Bully-Bakken, establish 3 overlapping 2560-acre units; 2 wells each, McKenzie
    23660, Whiting, Pembroke and/or Cherry Creek-Bakken, establish 2 overlapping 2560-acre units; 2 wells each, McKenzie
    23661, Whiting, Pembroke and/or  Juniper-Bakken, establish an overlapping 2560-acre unit; 2 wells; McKenzie
    23530, cont'd
    23662, Cornerstone, Bowbells-Bakken, proper spacing, Burke
    23663, Cornerstone, Ward-Bakken, proper spacing, Burke
    23367, cont'd
    23664, MRO, temporary spacing, Powell well, Slope
    23665, MRO, to confirm termination of a 2560-acre unit and establishing a 1280-acre unit was effective for purposes of allocating production from the Gary Bell (#24309) well, Dunn
    23666, Williston Exploration, temporary spacing, Billings
    23667, QEP, Grail-Bakken, establish one overlapping 2560-acre unit; 3 wells; McKenzie
    23668, BR, Little Knife, Big Gulch, and/or Rattlesnake Point-Bakken, establish three 2560-acre units, 1+ wells; Dunn
    23669, Hess Bakken, Beaver Lodge-Bakken, establish an overlapping 2560-acre unit; 1 well; Williams
    23670, Hess Bakken, Capa-Bakken and the Beaver Lodge Devonian Pool to establish a 1280-acre unit fort he Capa-Bakken Pool, 7 wells in either the Bakken or the Three Forks, Williams
    23671, Hess Bakken, Sandrocks-Bakken, exceptions to rule, McKenzie
    23235, cont'd
    23518, cont'd
    23672, Gadeco, pooling, Epping-Bakken, Williams
    23673, Gadeco, pooling,
    23674, Petro Harvester, flaring, Burke
    23126, cont'd
    23675, SM Energy, pooling
    23676, SM Energy, pooling
    23677, SM Energy, pooling
    23678, SM Energy, pooling
    23679, SM Energy, pooling
    23680, SM Energy, pooling
    23681, SM Energy, pooling
    23682, SM Energy, pooling
    23683, SM Energy, pooling
    23684, SM Energy, pooling
    23685, SM Energy, pooling
    23686, SM Energy, pooling
    23687, SM Energy, pooling
    23688, SM Energy, pooling
    23689, SM Energy, pooling
    23690, SM Energy, pooling
    23691, SM Energy, pooling
    23692, SM Energy, pooling
    23693, SM Energy, pooling
    23694, Petro-Hunt, pooling
    23695, Whiting, East Fork-Bakken, amend, authorize 12 wells in a 1280-acre unit; Williams
    23696, Whiting, Grinnell-Bakken, amend, authorize 14 wells in a 1280-acre unit; McKenzie, Williams
    23697, Whiting, Truax-Bakken, amend, 12 wells on each of four 1280-acre units; 2 wells on a 2560-acre unit; Williams, McKenzie
    23698, Whiting, Banks-Bakken, amend, 14 wells on five 1280-acre units; Williams, McKenzie
    23699, Whiting, Bully-Bakken, amend, 14 wells on 3 1280-acre units, McKenzie
    23700, Hess Bakken, Manitou-Bakken, amend, 2 wells on an overlapping 2560-acre unit; Mountrail
    23701, Hess Bakken, pooling
    23702, Hess, Antelope-Sanish, amend, 13 wells on a 1280-acre unit; McKenzie
    23703, Hess Bakken, commingling
    23704, BR, Clear Creek-Bakken, amend, 14 wells on a 1280-acre unit McKenzie
    23705, BR, pooling
    23706, BR, Little Knife-Bakken, amend, 7 wells on three 1280-acre units; Dunn
    23707, MRO, Reunion Bay and/or Big Bend-Bakken, amend, 2 wells on two 2560-acre units; Mountrail
    23708, Oasis, SWD, Mountrail
    Thursday, February 26, 2015

    23709, Cornerstone, South Coteau-Bakken, proper spacing, Burke County
    22639, cont'd
    22837, cont'd
    22998, cont'd
    22646, cont'd
    23710, Enduro, Hay Draw well, temporary spacing, McKenzie,
    23711, Armstrong, Hamisch well, temporary spacing, Divide,
    23712, SHD, Canon well, exception to completing, McKenzie
    23713, SHD, Antelope-Sanish, establish an overlapping 1280-acre unit, 1 well, McKenzie
    23714, SHD, Van Hook and/or Heart Butte-Bakken, establish an overlapping 3520-acre unit; 27 wells, McLean, Dunn
    23715, SHD, Heart Butte-Bakken, establish a 1600-acre unit, 17 wells, Dunn
    23716, SHD, Heart Butte and Deep Water Creek Bay-Bakken, establish an overlapping 7520-acre unit; 2 wells, McLean, Dunn
    23717, SHD, Deep Water Creek Bay-Bakken, establish an overlapping 4000-acre units 3 wells; Dunn, McLean
    23718, WPX, Eagle Nest-Bakken, amend, establish two overlapping 2560-acre unit; 1 well, McKenzie
    23719, WPX, Reunion Bay-Bakken, amend, establish an overlapping 2560-acre unit, 1 well, Mountrail, Dunn
    23605, cont'd
    23720, EOG, Parshall-Bakken, spacing boundaries, Mountrail
    23721, Liberty Resources, Stoneview and/or North Tioga-Bakken, amend, establish four overlapping 2560-acre units; 3 wells each, Divide, Burke
    23722, Liberty Resources, Temple-Bakken, amend, establish three overlapping 2560-acre units; 3 wells on each, Williams
    23723, Newfield, Keene-Bakken/Three Forks, flaring, McKenzie
    23724, Newfield, Sand Creek-Bakken, flaring, McKenzie
    23725, Statoil, Briar Creek-Bakken, establish an overlapping 1280-acre unit; 1 well; McKenzie
    23726, Statoil, Sugar Beet and/or Eightmile-Bakken, establish an overlapping 1280-acre unit; 1 well, Williams
    23727, Slawson, Marathon, Reunion Bay and/or Big Bend-Bakken, create two overlapping 2560-acre units, 2 wells each; Mountrail (spells out which sections will be operated by Slawson and which will be operated by Marathon)
    23590, cont'd
    23728, CLR, Catwalk-Bakken, amend, establish two overlapping 1600-acre units; 14 wells on each; create an overlapping 3200-acre unit; 1 well, Williams
    23729, CLR, voluntary unitized management of the proposed Cedar Hlls West North Dakota-Red River "B" Unit, a 680-acre unit, Bowman County
    23425, cont'd
    23426, cont'd
    22553, cont'd
    22847, cont'd
    23730, XTO, Bear Den-Bakken, flaring, Dunn, McKenzie
    23731, XTO, Cedar Coulee-Bakken, flaring, Dunn
    23732, XTO, Lost Bridge-Bakken, flaring, Dunn
    23733, XTO, North Tobacco Garden-Bakken, establish a 1920-acre unit, 12 wells, McKenzie
    23734, XTO, Haystack Butte-Bakken, establish a 2560-acre unit; 16 wells; McKenzie
    23735, XTO, Truax-Bakken, establish two overlapping 2560-acre units; 2 wells each; Williams, McKenzie
    23736, XTO, Elk-Bakken, establish four overlapping 2560-acre units; 2 wells each, McKenzie
    23737, XTO, Sand Creek-Bakken, estalbish two overlapping 2560-acre units; 2 wells each; McKenzie
    23738, XTO, Hofflund-Bakken, establish two overlapping 2560-acre units; 2 wells each, Williams
    23739, XTO, Glass Bluff-Bakken, establish four overlapping 2560-acre units; 2 wells each, McKenzie, Williams
    23740, XTO, Alkali Creek-Bakken, establish four overlapping 2560-acre units, 2 wells each; Williams, Mountrail,
    23741, XTO, Grinnel-Bakken, establish an overlapping 1280-acre unit; establish five overlapping 2560-acre units; 2 wells on each, Williams, McKenzie
    23742, XTO, Charlson-Bakken, establish two overlapping 1280-acre units; establish two overlapping 2560-acre units; 2 wells each; McKenzie
    23743, XTO, Bear Creek-Bakken, setback rules, Dunn
    23432, cont'd
    23013, cont'd
    23446, cont'd
    23277, cont'd
    23744, XTO, Bear Creek-Bakken, pooling, Dunn
    23745, XTO, Bear Creek-Bakken, pooling, Dunn
    23746, XTO, Lost Bridge-Bakken, pooling, Dunn
    23747, XTO, Morgan Draw-Bakken, pooling, Golden Valley and Billings
    23748, EOG, Antelope-Sanish, pooling, McKenzie
    23749, EOG, Parshall-Bakken, completing and producing a total on each of two existing 1280-acre spacing units, Mountrail
    23750, EOG, Parshall-Bakken, pooling, Mountrail
    23751, EOG, Parshall-Bakken, pooling, Mountrail
    23752, EOG, Parshall-Bakken, pooling, Mountrail
    23753, EOG, Parshall-Bakken, pooling, Mountrail
    23754, EOG, Parshall-Bakken, pooling, Mountrail
    23755, EOG, Parshall-Bakken, pooling, Mountrail
    23756, EOG, Parshall-Bakken, pooling, Mountrail
    23757, EOG, Parshall-Bakken, pooling, Mountrail
    23758, CLR, Brooklyn-Bakken, pooling, Williams
    23759, CLR, Catwalk-Bakken, pooling, Williams
    23760, CLR, Catwalk-Bakken, pooling, Williams
    23761, CLR, Catwalk-Bakken, pooling, Williams
    23451, cont'd
    23452, cont'd
    23615, cont'd
    23616, cont'd
    23762, SHD, SWD, Clarks Creek Field, McKenzie
    23012, cont'd
    23508, cont'd
    23507, cont'd

    TGIF -- January 30, 2015

    Active rigs:


    1/30/201501/30/201401/30/201301/30/201201/30/2011
    Active Rigs146190186204163


    RBN Energy: Mexico -- imports now; production later.
    In Part I of this blog we noted a dramatic increase in Mexican natural gas imports from the US over the past two years. Mexico’s imports increased because the country’s demand for natural gas rose significantly while domestic production declined. PEMEX is not able to develop local shale gas resources quickly enough to meet growing demand for electricity from the country’s booming industrial sector. The short-term solution has been to increase imports from the US while natural gas prices in the US are low. Further increases in import volumes ran into problems this year because of capacity constraints on the Mexican side.
    To increase the flow of gas to meet demand inside Mexico and to ramp up import capacity across the border, the Mexican government has embarked on an ambitious program to build new pipelines costing as much as $8B. A mixture of public and private companies is involved in building and operating this pipeline infrastructure – much of it dedicated to supplying power plants. The expansion projects center on two “backbone” pipelines – one in the southeast and the other in the northeast of the country – both of which involve new infrastructure to deliver gas from the US side.  PEMEX is using a Cayman Islands based subsidiary MGI to handle the US projects to avoid red tape and speed things up. In addition to the backbone projects there are a number of smaller connection projects inside Mexico that provide service to power plants. Inside Mexico the bidding for these projects is being handled by PEMEX as well as the state power company ComisiĆ³n Federal de Electricidad (CFE). Contracts not yet awarded are currently tied up in political stalemate while the new Mexican President Enrique Pena Nieto (who took office on December 1, 2012) decides on energy policy priorities.
    What follows is a description of the expansion plans and the latest completion estimates. The map below shows the major infrastructure projects as presented by PEMEX in September 2012. The red line is the US/Mexico border. The green lines are PEMEX sponsored pipeline projects that are underway. The green star shapes are where border capacity will be increased. The grey dotted lines are new pipeline projects not sponsored directly by PEMEX. The blue lines are the existing national pipeline system.

    Thursday, January 29, 2015

    Helmerich And Payne May Cut 2,000 Jobs As It Idles Rigs -- Rigzone, January 29, 2015

    Rigzone is reporting:
    Driller Helmerich & Payne Inc said it may cut 2,000 jobs as it begins to idle rigs amid a slide in crude oil prices, following similar cost cuts by top oilfield services providers Schlumberger NV and Baker Hughes Inc.
    Helmerich, which had about 11,901 employees as of Sept. 30, also said it would now build only 2 high-tech FlexRigs per month this year, down from the 4 rigs it had planned.
    The company's shares fell as much as 10 percent to $54 on Thursday as weak forecast for 2015 margins and revenue overshadowed a better-than-expected quarterly profit.
    The 2015 forecast "reflects a severe opening blow from the global downturn," FBR Capital Markets analysts wrote in a note. Helmerich has benefited so far from robust shale drilling activity in the United States. The gains extended into the first quarter Dec. 31, but are now eroding.
    See disclaimer

    Random Update Regarding Projected Number Of Oil & Gas Permits To Be Issued In 2015 -- January 29, 2015

    This is way too early to be doing this, January is not even over yet, but a) I was curious; b) I was bored; and, c) January 31 falls on the weekend skewing the numbers.

    The numbers may be slightly off, but probably not by much.

    On January 29, in each of the designated years, this is the number of oil and gas permits that had been issued by January 29th, the raw, actual number of issued permits as of January 29th:
    • 2015 (this year): 241
    • 2014 (last year): 253
    • 2013 (the year before last year): 218
    • 2012 (the year before that): 167
    Based on that data, if the number of permits were issued at the same rate, the number of permits projected to be issued each calendar year as of January 29th:
    • 2015: 3,033
    • 2014: 3,184
    • 2013: 2,744
    • 2012: 2,102
    The actual number of permits issued for the full calendar year:
    • 2015: --
    • 2014 (last year): 3,013
    • 2013 (the year before last year): 2,671
    • 2012 (the year before that): 2,521
    Just some idle numbers on a Thursday evening.

    *****************************

    Honky Tonk Angels Medley, kd lang, Loretta Lynn, Brenda Lee, Kitty Wells

    Venezuela -- YouTube Video Worth A Thousand Words -- January 29, 2015


    ***************************
    At Least It's Hard To Catch

    KCRA is reporting:
    A patient suspected of having Ebola is being treated at UC Davis Medical Center in Sacramento, hospital officials said.
     ******************************
    Updates

    February 4, 2015

    The AP is reporting:
    National guardsmen and state price adjusters fanned out across Venezuela Wednesday to impose a military-style occupation with an unusual goal: Making sure shoppers can buy enough sugar.
    The South American country's socialist administration temporarily took over the Dia a Dia supermarket chain as part of a crackdown on the private businesses it blames for worsening shortages and long lines.
    Embattled President Nicolas Maduro says right-wing owners are purposely making shopping a nightmare by hoarding goods and removing checkout stations. He has promised to jail any business owner found to be fomenting economic chaos.
    Two executives of Venezuela's largest drugstore chain, Farmatodo, were detained over the weekend as part of an investigation by price-control authorities.
    On Monday night, Congress President Diosdado Cabello said officials had arrested Dia a Dia's owner and taken over its 35 stores "for the protection of Venezuelans." By Tuesday morning, armed soldiers were overseeing lines for bags of sugar at a Dia a Dia location near the presidential palace.
    Posted at time of original post:
    And the breaking point will be ...
    Long Grocery Line During Venezuela Crisis

    Eleven (11) New Permits; 2/3 Wells Go To DRL Status -- January 29, 2015

    Oil stimulus is about equal to President George Bush's 2008 stimulus.

    Agenda for NDIC Hearing Dockets have been posted. Link here

    Active rigs:


    1/29/201501/29/201401/29/201301/29/201201/29/2011
    Active Rigs145190187204163

    Wells coming off confidential list today were posted earlier; see sidebar at the right.

    Eleven (11) new permits:
    • Operators: QEP (6), Whiting (3), SM Energy (2),
    • Fields: Grail (McKenzie), Blue Buttes (McKenzie), Twin Buttes (Dunn), Burg (Divide)
    • Comments:
    Four (4) producing wells completed:
    • 27819, 77 (no typo), Oasis, Andre Shepherd 55-1 21-5 5T, Missouri Ridge, t12/14; cum --
    • 28027, 2,070, Oasis, Twobins 5501 13-29 5B, Missouri Ridge, t12/14; cum --
    • 28081, 443, CLR, Franklin 2-29H1, Stoneview, t1/15; cum 4K 11/14;
    • 28083, 285, CLR, Franklin 4-29H1, Stoneview, t1/15; cum --

    Wells coming off confidential list Friday:
    • 27752, 836, Petro-Hunt, State of North Dakota 154-99-16A-5H, Stockyard Creek, producing; another well with an interesting production profile; t11/14; cum 23K 11/14;
    • 28486, drl, Hess, HA-Dahl-152-95-0706H-7, Hawkeye, no production data,
    • 28775, drl, XTO, Ranger 21X-18C, Tobacco Garden, no production data,
    ****************************************

    27752, see above, Petro-Hunt, State of North Dakota 154-99-16A-5H, Stockyard Creek:

    DateOil RunsMCF Sold
    12-201461470
    11-2014153420
    10-20146770

    Winners And Whiners -- Did I See A Cramer Headline Along That Line? -- January 29, 2015

    Regardless, looks like Amazon is a winner; shares are surging after hours. Dynamic link here.
    Amazon issued earnings of 45 cents a share, soaring past expectations of 17 cents, but revenue of $29.33 billion trailed.

    Analysts had expected Amazon.com to report earnings of 17 cents a share on $29.67 billion in revenue, according to a consensus estimate from Thomson Reuters.

    The company projected first-quarter sales of between $20.90 billion and $22.90 billion, compared to StreetAccount estimates of $23.00 billion. 
    Amazon is up almost $30 (8%) after-hours. I think Jim Cramer said Amazon was ridiculously expensive back in November.

    ******************************

     Visa will split 4 - 1.

    Google (GOOGL): forecas $7.11; miss; shares fall; $6.88 per share. Google whining: losses due to currency fluctuations. My hunch AAPL also has currency issues with which to deal.

    Gasoline Demand Data Finally Released -- January 29, 2015

    It's possible this data was released on time, but the webmaster forgot to update the release date. Regardless, here it is. The link is a dynamic link

    Compare today's graph with the graph one week ago.

    Today's graph:



    Although demand dropped again, the demand remains about 500,000 bbls more per day than a year ago. Will we see an upturn starting next week? Stay tuned.

    Graph one week ago at this link.

    Keystone XL 62 - 36 Senate; Existing Home Sales Plummet In December; Odds And Ends On A Thursday -- January 29, 2015

    Sales of existing homes in December: unexpectedly fell by the most in 12 months
    • housing industry's recovery is "uneven"
    • but the story is even worse than the headline: the 3.7% drop in December (way more than expected) followed a meager 0.6% gain the prior month -- smaller than initially estimated
    • but it's even worse: analysts forecast a slight gain (0.5%) versus the huge decline
    • by region: northeast, a drop of 7.5%; the west, a decline of 4.6%; in the midwest, a 2.8% decline; and in the south, a 2.6% drop
    • resales make up 90 percent of the housing market
    US home ownership falls to 20-year low.  Just under 64%.

    Senate votes on Keystone XL, passes 62 - 36; now headed for the president's veto.

    COP and OXY each cut spending by 30%. Some data points:
    • COP previously said they would cut CAPEX by 20%; now up to 31%
    • OXY will cut CAPEX by 33%; noted a $1.6 billion profit in 2013; an almost-$6 billion loss in 2014
    Kinder Morgan's Freedom Pipeline project gaining more interest
    • would move Texas crude oil from Texas to California
    • would convert a natural gas pipeline to move crude and condensate
    • a $2 billion project; 740-mile line; would require more than 200 miles of new pipeline
    • would reformulate Texas crude at front end so it would more nearly match Alaska North Slope crude
    • project would also ship ultra-light crude which could then be exported from California
    • includes a topping unit in Wink, Texas where Texas oil / condensate would be reformulated
    Random update of status of US exporting ultra-light condensate (same link)
    • KMI did not say if they had permit approval to export ULC from California
    • "at least" four other companies have such permits; a fifty is moving ahead with exports -- not waiting for approval, arguing "minimal processing" meets the letter of the law
    Big Oil cuts $20 billion in five (5) hours to preserve dividends (the story is mostly about Shell)
    • Shell, the first to report earnings, will defer / cancel about 40 projects worldwide
    • OXY cut 33%
    • COP raised cuts to 31%
    • more than 30,000 layoffs have been announced across the oil industry
    Shell still plans to drill the Arctic this summer
    concern if they don't do it this year, ice expansion could preclude drilling in the future (I made that part up)

    Natual Gas Fill Rate Right At The Middle Of The 5-Year Average -- January 29, 2015; New "Gasoline Demand" Data Still Not Posted

    Natural gas fill rate, a dynamic link: -94. Current fill rate is right at the five-year average. This is quite remarkable (see graph at bottom of the linked article).

    Gasoline demand (a dynamic link): screenshot data at this post. RTCC is reporting
    Weekly US gasoline demand soared to five-year highs last month, after a collapse in oil prices, in a worrying sign that previous gains in efficiency and emissions cuts may evaporate.
    The final week of December saw the highest US weekly consumption in any week of the year since July 2010.
    Several years of high oil prices, and the financial crisis, have driven energy savings by consumers and vehicle manufacturers.
    In addition, governments have sought to curb oil imports and drive savings and carbon emissions cuts through increasingly ambitious efficiency standards for motor vehicles, planes and ships.
    An important question is how far these recent savings have been hard-wired into consumer behaviour, and whether the new standards will drive long-term cuts in carbon emissions and energy consumption.
    ******************************
    A Note to the Granddaughters

    I wrote about the Marine Mammal Care Center In San Pedro a few weeks ago. A bit more on the story. Reuters is reporting:
    California sea lions – mainly pups – are turning up stranded and starved on Southern California beaches in record numbers this year, leaving experts worried that this winter may be the worst season ever documented for the marine mammals.
    The precise cause is not clear, but scientists believe the sea lions are suffering from a scarcity of natural prey that forces nursing mothers to venture farther out to sea for food, leaving their young behind for longer periods of time.
    Experts theorize that this winter's mild El Nino effect, which alters ocean currents and temperatures, may be compounding the shortage of fish that sea lions rely on for food, said Keith Matassa, executive director of the nonprofit Pacific Marine Mammal Center in Laguna Beach.

    A Couple Of Huge Wells Being Reported By EOG -- January 29, 2015

    The wells:
    • 27035, 441, EOG, Parshall 60-1509H, Parshall, t81/4; cum 86K 11/14;
    • 27042, 519, EOG, Parshall 46-1004H, Parshall, t8/14; cum 105K 11/14; 
    ***********************************
    Scotland Bans Fracking

    Reuters via Rigzone is reporting:
    Scotland on Wednesday blocked the granting of permits for fracking and a local English council delayed a decision on two projects, casting doubt on British Prime Minister David Cameron's shale gas ambitions.
    Cameron has said he will go "all out for shale" to help stem a decline in North Sea oil and gas output, but environmental concerns about the use of the fracking technology used to unleash gas trapped in rocks have turned sentiment more negative.
    Scotland, estimated to have around 80 trillion cubic metres of shale gas resources - enough to cover all of Britain's gas needs for more than 30 years - imposed a moratorium on planning permits until it examines the health impact and other consequences of extraction. 
    Luddites.

    After reading the story about Scotland banning fracking read these two posts:
    The problem with "banning fracking until health studies are complete" backs a government into a corner. "They" all know they need the energy; "they" all know fracking is safe; "they" all know "they" are doing this to be politically correct and for "show"; and "they" all know that eventually they will allow fracking. And they can only allow fracking if the studies show that fracking is safe. And that's a tough corner to be in. There are enough people that don't even accept the benefit / risk ratio regarding immunizations (and that issue is very, very challenging in the UK).

    **************************
    Can't We All Just Get Along?
    Erie, Colorado, is trying.

    Rigzone is reporting:
    The Board of Trustees of Erie, Colorado voted against imposing a moratorium on fracking in the Front Range town Tuesday evening.
    In the video-streamed event, the seven-member board consisting of the Mayor, the Mayor Pro-Tem and five trustees cast four votes against the one-year moratorium.
    Representatives from Encana Corp. and Anadarko Petroleum Corp. were present for the meeting, as were industry groups and a number of local residents who were for and against the moratorium.
    Memorandums of understanding (MOU) agreements between the two drillers and the township of Erie will continue. The agreements “contain best management practices the operators agree to use and are included as part of their state drilling permits,” according to a January 27, 2015, story in the Denver Post.
    The moratorium was said by the Board of Trustees not to be seen as a vote against drilling in the area, but rather as a way to resolve issues stemming from vibration and noise problems generated by an Encana drilling pad near the Vista Ridge development.
    However, Encana and Anadarko representatives said the companies would give the town time for the two sides to resolve all issues without the need for a moratorium. Encana agreed not to submit any new permits for 90 days, and Anadarko said it was not planning to submit any permits for several months.
    Last summer, Colorado Governor John Hickenlooper appointed a task force to study the issues involved with oil and gas drilling near towns along Colorado’s Front Range after residents and environmental groups on one side, and oil and gas companies and business leaders on the other side, issued countering voter initiatives that could potentially have cost Colorado significant oil and gas revenues. Both sides agreed to drop the initiatives and wait for the task force to come up with its recommendations.
    ****************************
    Attorney General Nominee Says Illegals Have Right To Work In This County
    Further: She Wants To See Them Working In This Country

    Link here.

    If the GOP-controlled Senate can live with this, I've lost all confidence in the Senate as a legislative body.

    It is certainly everyone's right in the United States to express whatever views one has, but it is entirely inappropriate for the US Senate to confirm an attorney general who testifies that illegals have a right to work in the US, and hopes they do work in the US, even in an undocumented, illegal status.

    It's one thing for any politician to say this, but it's completely different for an attorney general to say this. If an individual is here illegally, that individual needs to be returned to his / her country of origin within the boundaries of prescribed due process.  During that "due process" some illegals will be given permission to stay, and that's fine. That's working within the law, but to espouse a blanket believe that all illegals in this country have the right to work -- well, the nice thing about that: no more ICE raids on Wal-Mart, Tyson, Marriott, Chipotle, and all those California corporate farms. [Actually, it's now plausible why the GOP -- in the pocket of big corporations -- are going to love the new attorney general. By the way, the US Chamber of Commerce also supports her views. So, as usual, I assume, I'm in the minority on this issue. And that's fine.]

    But if the attorney general wants to keep illegals in this country and wants to encourage them to work, she needs to have Congress change the law. This is really getting bizarre. One almost gets the feeling that the GOP (Big Money) is working in cahoots with the attorney general on this one. This is a win-win for everyone. Congress doesn't want to take the heat by changing the law, so they let the attorney general do that for them. Wink, wink.

    McDonald's And "Total Brand Confusion" -- January 29, 2015

    The McDonald's story is interesting. Slumping sales; slumping CEO.

    Today this headline: McDonald's has 'total brand confusion': Sonnenfeld.

    I didn't read the article, and probably won't.

    I've been reading several books on Steve Jobs lately. I'm at Starbucks and the books are at home, so I can't reference the books directly, but that headline above reminded me of Steve Jobs ability to focus.

    When Jobs came back to Apple, the company had no less than 20 different products -- and they were all 20 different versions of their computers. He had no idea how people could figure out what computer to buy.

    Jobs "directed" that Apple would sell four computer models and that was it. The engineers, sales staff, everyone went nuts. Cutting product line from 20 to 4 was not going to work. (It did.) Apple even glued the computer cases so folks couldn't modify their own Apple computers (made a lot of geeks very, very unhappy, but Steve Jobs wasn't targeting geeks; his target was the best possible computer experience possible).

    Steve Jobs also knew that he could take his best 20,000 hardware and software folks and have them working on four projects: iPod, iPad, smart phone, laptops. Or he could have his 20,000 folks working on one project: the cell phone. He put everything else on the back burner and made an insanely great iPhone. The iPad had to wait a year. (Or maybe it was the other way around, I can't remember, but the point is made.)

    I spend a lot of time in McDonald's -- well, not a lot of time -- rather, I visit a lot of McDonald's whenever I travel cross-country. The experience is predictable; the coffee is great; the prices are incredible; and they have free wi-fi (just no outlets to charge one's mobile devices).

    I hardly ever look at the McDonald's menu. I order a coffee and a small hamburger ($1 each). I used to add fries but I've learned I don't need them. When McDonald's introduced the dollar-menu, I was thrilled. A little variety and still a dollar. And that's the problem: how many folks are making their McDonald's - Burger King - Chik-fil-A choice based on price: These fast food restaurants are all inexpensive. If McDonald's didn;t offer the dollar-menu, I would be buying almost the same thing and would pay $3.50 instead of a dollar, and for the free-wi-fi, and otherwise predictable experience, and good coffee, I wouldn't mind.

    In-N-Out: two hamburger choices, or thereabouts, and not much more when it comes to fries and drinks. Can't get any simpler.

    The other problem with McDonald's: McDonald's is sort of like Samsung and the cheap cell phone market. Sure, Samsung can sell a lot of phones but the margin is slim; they are not making much (any?) profit on these phones. Apple made a strategic decision not to target a particular audience; Samsung appears to have made a strategic decision to target the low end of the market. McDonald's seems to have done the same thing: target the low end of the market.

    Chik-fil-A and In-N-Out, on the other hand, appear that they do not target the low end of the market. I'm not sure they are even targeting a specific market.

    Instead, Apple, Chik-fil-A, and In-N-Out seem to be focusing on the best product they can make and serving it in the best environment they can provide -- and not worry about whether they are targeting the high end, the middle, or the low end of the market. But McDonald's, it appears, has set its sights on attracting the low end of the market and I see it every time I visit McDonald's. Nine times out ten the McDonalds' staff is awesome, but 10% of the time, I run across McDonald employees whose values seem to be the same as the low end of the market they attract. That really never happens at In-N-Out or Chik-fil-A. Or even Wendy's although it's been a long time since I've been there (I don't know if they offer free wi-fi). I've never had a bad experience at Whataburger and I go there even knowing they don't have wi-fi. [Whataburger, by the way, offers barely more than one type of hamburger -- but they serve it 53,000 different ways to order.]

    The one thing that turns me off about going into a McDonald's: my elitism. I don't like to be seen as part of their target audience -- the low end of the market. Actually, that's not quite true. I don't mind going in alone, but I really don't like to take anyone with me. And I suppose I really don't mind being seen as part of the low end of the market, but there are a lot of folks at McDonald's that are at the very low, low, low end of the market -- it's very elitist, but that's my problem. It shouldn't be McDonald's problem. But in some localities, it seems, McDonald's is barely one step above a "soup kitchen" from the Great Depression. With wi-fi.

    Maybe I will go back and read that linked article about McDonald's and "total brand confusion."

    Jobless Claims Drop To 15-Year-Low And Mainstream Media Has No Explanation; Stuff Happens -- January 29, 2015

    The post below was posted earlier, but this is so strange, I wanted to post it again. It is being reported that jobless claims plunged by 43,000 to 265,000.

    The market knows this number is bogus: if the numbers were really this good, Janet Yellen would feel comfortable "raising rates" and when the Fed "raises rates" the market will get clobbered. So, what's the market doing today? Future are up. This is unexpected with a plunging unemployment claims number.

    This certainly caught folks by surprise. First, the median estimate was 300,000 -- a most reasonable number. Second: the jobless claims usually move up or down by 5,000; sometimes as much as 15,000, but that is very rare. When I saw this plunge of 43,000, something seems way off. It will be interesting to see what the revised number is next week. In addition, the plunge does not square with all the layoffs in the oil and gas sector as well as other data suggesting firms are laying off folks.

    Scroll through the weekly numbers: page 1page 2; page 3; and page 4. A plunge of 43,000 to 265,000 just does not compute. Back in May, 2014, there was similar "strangeness," but nothing even close to this "43,000" plunge:
    Also, very strange: Bloomberg didn't have much to say about it. No analysis on a story that should be a big story. At AP the headline says this is a 15-year low. But at least there's an explanation:
    The latest drop may have been exaggerated by the federal holiday, which likely slowed the processing of some claims.
    We won't know any more next week:
    • processing of claims this week will be even farther behind with the snowstorms/blizzards
    • folks in New England weren't able to get out of the house this past week to file unemployment forms
    • the Super Bowl mania this week and into next week will further disrupt data
    ***********************************
    Job Watch: Posted Earlier

    Bloomberg: Link here to what seems to be a very, very fishy number.
    Jobless claims plunged by 43,000 to 265,000 in the week ended Jan. 24, the lowest since April 2000, a Labor Department report showed Thursday in Washington. The median forecast of 51 economists surveyed by Bloomberg called for 300,000. The week included the Martin Luther King holiday, which makes the data more difficult to calculate, a government spokesman said as the report was released. 
    The Labor Department revised the prior week’s reading to 308,000 from an initially reported 307,000.  
    The four-week average of claims, a less-volatile measure than the weekly figure, dropped to 298,500 from 306,750 in the prior week.
    The number of people continuing to receive jobless benefits declined by 71,000 to 2.39 million in the week ended Jan. 17. The unemployment rate among people eligible for benefits held at 1.8 percent during that period, today’s report showed.
    Comment: there almost seems to be something bogus or surreal about this number. The jobless claims usually move up or down by 5,000; sometimes as much as 15,000, but that is very rare. When I saw this plunge of 43,000, something seems way off. It will be interesting to see what the revised number is next week. In addition, the plunge does not square with all the layoffs in the oil and gas sector. Something seems very, very fishy.