The Million Dollar Way (The Bakken Oil Blog): When It Rains, It Pours -- Busy, Busy, Sunday Night -- September 15, 2019

Sunday, September 15, 2019

End of second full day following the strike:

except that the price of oil jumped (and to tell the truth, I don't think it jumped as much as folks thought it would), one could hardly tell anything happened in the Mideast over the weekend
some compared it to Pearl Harbor: based on events today, the attack on Saudi Arabia compares not at all to Pearl Harbor
egged on to do something, Trump seems relaxed, sitting back, watching; keeps his schedule; attends New Mexico rally as scheduled
US stock market down slightly but futures are green for tomorrow
the attack on Saudi: almost a non-event

Original Post

Most fascinating: to see the price of gasoline at your neighborhood service station tomorrow

for the record, the price of unleaded regular was running $2.16 to $2.39 here in north Texas
along the highway, higher-priced stations, here in north Texas (DFW area): $2.39
I filled up for $2.16/gallon this morning in downtown Keller, TX, well away from the highways

Mideast on the brink. Story tracked here. There are so many story lines:

more and more stories that Iran's economy was ready to implode due to US sanctions
Iran announced as recently as this week that it would pursue "speedier centrifuges": Iran admits to using advanced centrifuges, violating nuclear deal

Saudi getting ready to announce Aramco IPO
Israel's Netanyahu on the ropes
Brexit
Bolton "fired"
new "Alfalfa" in place for just one week (the step-brother to the heir to the throne; another son of the king of Saudi Arabia)
US 2020 presidential campaign has begun
son of Osama bin Laden confirmed killed in Afghanistan this past week
Trump's determination to withdraw from Afghanistan
the decision NOT to meet with the Taliban at Camp David
US Federal Reserve under pressure to cut rates

attack could settle the argument: is US shale the swing producer?
during Mideast hostilities, Saudi Arabia may not be the swing producer
September and October (2019) production data won't be seen until December, 2019 and January, 2020

even if terminal "back to normal," risk premium is now $5 - $10/bbl (forever and ever, amen)
if terminal takes more than a week to return to normal, think $75 WTI
if terminal takes a month to return to normal, think $100 WTI

will Trump listen to US generals or will Trump go it alone?
exactly who is in charge of the US military? -- quick, name the Secretary of Defense

fake news
credibility issue
exactly who is in charge of US intelligence? -- quick, name the new national security advisor

Rahm Emanuel: "never let a crisis go to waste." Issues that should be affected by the attack on Saudi's oil terminals and oil field

Nominee for 2019 Geico Rock Award: IEA

IEA: "the US shale revolution has reshaped the energy landscape at home and abroad, according to latest IEA policy review"

the IEA, as a nominee for the 2019 Geico Rock Ward --the timing of this report, that "the US shale revolution has reshaped the energy landscape at home and abroad" is simply too much -- I can't make this stuff up:

the price of oil -- at $50 to $60 -- is an existential issue for Saudi Arabia (and, thus by extension, a huge, huge deal for the EIA)
sanctions on Iran did not drive up the price of oil; US shale more than made up for any shortfall
the Libyan oil story is irrelevant (as are the oil stories of several other legacy oil providers)
Iran was about to implode
Venezuela was about to implode (of course, we've been saying for a decade now)
Mexico was about to implode
the IEA statement released September 13, 2019