Cushing Crude Oil Stocks Rise 2.3 Million Bbls -- July 22, 2015

Active rigs:

	7/22/2015	07/22/2014	07/22/2012	07/22/2011	07/22/2010
Active Rigs	68	196	207	182	138

RBN Energy: crude by barge traffic along the Gulf coast.

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Unexpected Rise In Crude Oil Stocks At Cushing

Reuters is reporting that there was an unexpected rise in crude oil stocks, most recent weekly report:

Industry data released on Tuesday by the American Petroleum Institute (API) showed crude inventories at the Cushing, Oklahoma, hub rose 2.3 million barrels last week, compared with analyst expectations for a decrease of the same volume.  

I assume most oil from Texas goes directly to storage facilities and refineries along the Gulf Coast, although I could be wrong, and that the Cushing is predominantly Bakken and Oklahoma oil. I could be very, very wrong ... just thinking out loud. But if even somewhat accurate, it is absolutely amazing that with how much operators are cutting back in the Bakken the stocks keep building in places like Cushing.

How much does 2 million bbls represent at Cushing? Cushing stores about 150 million bbls.

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This Is Not An Investment Site

Boeing surges; great earnings report.

Qualcomm and Xilinx both report after market closes.

I don't invest in two of the three mentioned; never have, never will. They just interest me for various reasons.

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Huge Story? Huge Disconnect? Huge question mark?

Something is going on. There's a disconnect. "Everyone" tells me the financial world is coming to an end. Greece is bankrupt. Really bankrupt. Interest rates remain as low as ever. "Everyone" says the economy is headed for a huge fall. China is next. China is hoarding gold.

So what is gold doing?

Gold sinks in longest rout since 1996 (twenty years ago).

I'm a buyer at $800.

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ConocoPhillips Says "No"

From SeekingAlpha:

• ConocoPhillips says it has ended talks with PetroChina on a shale gas development in the country after a two-year study.
• COP signed an agreement with the Chinese company to evaluate shale potential in the Neijiang-Dazu field in the Sichuan basin in early 2013.
• "Given the complicated shale formations in China, only the state-owned Chinese energy firms are more likely to pursue their investment in the sector" in the current low oil price environment, says a strategy director at ICIS China.

"...complicated shale formations." Hmmm.

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Analyst Says "Yes"

From SeekingAlpha:

• More on Goldman Sachs' addition of Exxon Mobil to its Conviction Buy list: Analyst Neil Mehta thinks the company is positioned to outperform the sector and calls the company a "rare dividend/FCF growth story among big oils."
• Metha highlights four key positives: improving free cash flow, driving premium dividend growth; an inflection in production growth; strong refining earnings improvement driven by higher global crack spreads; and investor positioning, with many large cap portfolio managers still meaningfully underweight the stock.
• The analyst expects free cash flow will ramp from $9B at $57/bbl Brent in 2015 to $19B in 2017 at $65/bbl Brent, as capex decreases and volumes improve, and believes XOM can raise its dividend, on average, by 6% through 2017 vs. zero improvement for ConocoPhillips and just 1% for Chevron.

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It's Not The Headline That's Surprising

There are three story lines with this story. The headline: Hillary losing ground in battleground states. That headline is interesting but not as surprising as "the rest of the story." This is what is surprising:

• look at the spread head-to-head
• this is not against a generic "Republican" but against specific names (each with a lot of baggage)

But most surprising:

• it's being reported on ... CNN.

This is Jeb Bush's race to lose, and he will lose if Trump goes the Perot route.

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Police Support

I like to think my support for the local police is about as deep and strong as it can possibly be, but I have to admit, I'm starting to lose my patience (or understanding or sympathy or empathy) with/for the cops.

The Sandra Bland video tells me just how badly police harassment can be (and I'm beginning to wonder if this is the norm for situations involving minorities). The altercation as shown in the video is not taken out of context; the entire 50-minute video from start to finish is shown. By the way, the video was also "doctored." And the "doctoring" was incredibly amateurish. [Authorities call it a technical glitch. Maybe.]

The woman-driving-while black was otherwise driving following all the rules. She says she saw the police cruiser come up behind her -- this was a long, straight, four-lane divided highway -- and she moved over to the right to let the cruiser pass.

The policeman pulled her over because she did not signal a lane change. Give me a break.

The policeman later says that he was only going to give her a warning -- in fact he has the paperwork to prove it; unfortunately, he strung the situation out, not once mentioning it was only going to be a warning -- clearly seeing how far he could push it. He's very, very clever: the paperwork shows a "warning" but he was itching for more. [He was clearly very, very passive-aggressive with this motorist.]

There is one thing that no one has commented on yet. It appears that the police officer "cut" this driver out of the herd, or profiled her. He was driving in the opposite direction, and made a U-turn to drive in the same direction as Sandra Bland. Her car was the only one in front of him when he started following her. Perhaps it was simply happenstance; perhaps he had a reason to make that U-turn and return to where he had been coming from. Who knows? But on this long, straight, wide boulevard with two wide lanes going the same direction, he drives fast enough to catch up with her and then comes up on her tail. I would have pulled to the right in the same situation, and most likely would have signaled, but not necessarily.

Lucy, you got some 'splainin' to do!

What I really have trouble with is this trivial traffic enforcement by local police. With all the real crime going on we don't need cops pulling over folks for failing to signal a lane change. If that's important, then local police departments need to establish a separate "traffic enforcement detail" that use clearly marked vehicles and authority to issue only warning tickets. The TED's only purpose would be traffic safety. If they see something that might be more than a simple traffic stop, they need to call the dispatcher for "back-up." For example, running a red light or excessive speeding, would require the "regular" police to get involved. The TED stop would be a quick 30-second stop; no names taken; no document check, simply a nice, "Thank you, ma'am, sorry to stop you, but in the future, remember to use your signals when changing lanes. Have a great day."

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Why JiffyLube Is So "Jiffy"

I now know why they can do some routine maintenance in a "jiffy."

I love Firestone and I take my cars into Firestone for "everything" other than an occasional oil change. I switched from car dealer maintenance shops to Firestone about ten years ago when our Chrysler dealer in San Antonio closed or moved to a new location much farther way. Right across the street was a Firestone and ever since, I am sold on Firestone. It's interesting how much Firestone offers their customers through "loyalty" programs.

Yesterday, having just returned from that cross-country trip in the Chrysler minivan, I stopped by the local JiffyLube to get an oil change. I thought I really should go to Firestone, a bit farther away, but what the heck, just an oil change. They always treat me very, very well, and I have nothing but respect for them.

The car is very well maintained, and nothing else really needed to be done, but they reminded me that the manufacturer recommends tire rotation every 6,000 miles; it had been 7,000 miles. So, against my better judgement, why not? What could possibly go wrong?

In passing, they also mentioned the 60,000-mile manufacturer's recommendation for a new serpentine belt. Replacing serpentine belts have become so much easier since the 1970s when I first heard about serpentine belts; and the cost was nominal (in the big scheme of things). The shop was not a bit busy; and, I thought, again, against my better judgement, why not. I was there; it was a quiet day; I had plenty of time; it would take only 20 minutes. What could possibly go wrong?

I got the oil change and the tire rotation done. I paid. Then thought about the serpentine belt. Oh, what the heck; they're not doing anything else; it's quiet.

So, I went back in and told them to replace the serpentine belt.

On the way home, I thought I heard a noise coming from outside the passenger compartment, but couldn't tell if it was coming from the engine or the chassis or if I was simply imagining it. The car drove completely normal: no vibrations, no other noise. But it seemed to get worse.

I took it out later for another test drive to see if I was imagining things. Nope, the sound was still there and it seemed to be getting louder. Something was definitely wrong.

It was now after normal business hours so I would have to wait until the morning.

This morning I drove the frontage roads (not the freeway) to the Firestone dealer where I normally go (except for aforementioned oil changes). I told Jamy my tale of woe, asking forgiveness for going to one of his competitors and not to him in the first place.

He understood.

It turns out that the JiffyLube folks tightened the lug nuts on three of the four wheels. The fourth wheel had all lug nuts inside the hubcap but not tightened. They had been started by hand, but not tightened with a wrench. They were almost ready to come completely off. The wheel was literally ready to fall off the axle. Jamy was surprised I got as far as I did.

I told Jamy to charge me whatever he wanted. I needed to atone for my sins (for not visiting him first). No charge. He couldn't even make up something. Finally he said I could tip the guys that tightened the lug nuts (and checked the rest of the car). I gave him a generous tip that he could give to the employees. (I always give the tips to a manager in these situations for very good reasons.)

I will be bringing a dozen or so doughnuts to Firestone once a week for the next several weeks.

Tire rotations, by the way, are free at Firestone. And for very little extra at the first alignment, one can get "alignment for life." Wheel alignment, not spinal alignment.

But at least I know why this particular JiffyLube is so "jiffy." They save 25% time by tightening lug nuts on only three of the four wheels when doing a tire rotation.

[By the way, Jamy told me this happens periodically, so he never speaks badly of his competitors. He said it could happen in his garage -- although I doubt it. But if this happens "periodically," .... one wonders what else happens "periodically"?]

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So, Incredibly Cool

I continue to piece together the dinosaur story and the evolution-of-life-on-earth story. I continue to read very slowly Dawkins' The Ancestor's Tale. While reading about mammal-like reptiles and monotremes (platypus and echidnas) I came across this very, very obscure but interesting bit of trivia: 

Monotremes (not therian-mammals): retain other reptilian features including the interclavicle bone near the shoulder, which reptiles, but no therian mammals, possess.

So, googling "interclavicle bone near the shoulder" took me to Bob Bakker's blog, something I do not recall having seen before.

The entire note on the "interclavicle bone" at the linked site is very, very good but the best part is the reference to Tarantino's Pulp Fiction, a movie that I have been watching and re-watching over the past few weeks. Bob writes:

To understand the architectural implications of the interclavicle, we must decide on our favorite role played by Uma Thurman. (We just love her — we even have a bone bed named “Uma”). We are impressed with Uma as “Ulla”, the Swedish femme fatale/housekeeper/tidying-upper in The Producers, but our choice would be Mia, the gangster girlfriend in Pulp Fiction.

Mia explains the interclavicle in the famous scene where she is stabbed in the heart with a huge syringe wielded by John Travoltaʼs character, who is trying to resuscitate her after an unfortunate mix-up in recreational prescriptions.

Travolta illustrates an emergency procedure: the needle must be thrust hard through the human breast-bone and into the cardiac cavity to jump-start the heart.

(Note: Do not try this at home. Ever. Not even with the pet gerbil.)

Mia does regain consciousness, with the syringe still sticking out of her breast-bone. (The technical name for her breast-bone is sternum.)

But let’s get to the osteological point. The breast-bone, aka sternum, is NOT the same as the breast-plate, aka interclavicle.

Our human breast bone is part of our rib-cage. Itʼs in the middle of our chest and ties the right and left side of our ribs together. Itʼs made from rather soft bone material (so you can, in fact, get a needle through).

The turkey breast-bone is the same unit, a sternum, but is much bigger and harder.

Next Thanksgiving, poke around with your fork to see how the birdʼs ribs attach to the sternum.