Friday, March 10, 2017

The Energy And Market Page, T+49 -- March 10, 2017


WTI: down 65 cents; and now trading below $49. 


How did the market react to the incredible jobs report today?  Pre-market futures for the Dow: up 70 points. Market opening: up 68 points.

WTI on opening: up slightly; still under $50.

MRO: up another 2%.

Facebook: at 139, nearing/hitting it's all-time high.

Animal spirits. This is what is meant by "animal spirits": those who dither are going to lose. And everyone knows it.
  • western countries will compete again
  • competition among US states will be seen again
  • competition among US corporations will continue
Countries / states with high taxes will lose. Countries / states with high energy costs will lose. Countries / states that don't leverage tech will lose.

Retail: seventeen retail stores at risk of bankruptcy -- FBN.

Oil. Alaska. Huge find. Stand-alone post coming.


Jobs. February jobs report on tap today.

WTI: the bleeding has stopped. Flat to up slightly; pre-market trading at $49 and change.

Dow: futures are up 70 points, which would put the open at 20,900. Considering everything, that's not bad.

US crude oil production forecasts (link here):
  • last March (2016): 8.29 million bopd
  • December, 2017 (latest EIA forecast): 9.53 million bopd
  • 1.24 million bopd (increase in forecast for US production)
  • global production: 100 million bopd (rounding)
  • 1.24 / 100 million = 1.24% of global production
  • Saudis complaining that US oil companies are taking advantage of OPEC cuts
  • cry me a river 
  • on the other hand, 1.24/8.29 = a 15% increase in US production
  • that's not bad
  • a 15% increase in US production -- almost all of it on-shore shale at this point
  • the revision specifically excludes production from the Gulf of Mexico (which, of course, makes no sense to me)
  • that's not trivial
  • and Snopes said the Bakken "might have some oil" 
Which reminds me -- whatever happened to Jane Nielson? From an earlier post:
This still remains one of my favorite posts. Jane Nielson says:
Frequent Internet users are getting emails about the Bakken Formation in North Dakota and Montana, supposedly a great oil bonanza just waiting to be tapped if only nasty enviros would let it happen. The emails and websites say that Bakken would solve all our petroleum “needs.” (What, me worry about  global warming?)
Don’t believe it. There’s some oil to be gotten out of Bakken, and it’s going to be exploited. But the “bonanza” is nothing but hype.
By the way, what's a "frequent internet user"?

Pipeline: underutilized pipeline serving the Great White field on the US side of the Gulf of Mexico.  could offer Mexico an opportunity to ship oil from their fields to the US.

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