Friday, August 21, 2015

Week 33: August 16, 2015 -- August 22, 2015

Wow, what a week. Earlier I suggested that the market (the Dow) might lose 1,000 points in less than a week and wow, if I wasn't just about right. What an opportunity for long-term investors.

I also learned a bit more about the global crude oil trading market, and one of these days, I may even remember the definition of contango.

I end the week with a great Politico story with this graphic (sorry about all the white space -- that's how Politico posted the graphic):

The WTI oil crawler suggests oil broke through the $40-floor today. Peak oil? What peak oil? This is absolutely insane.

I particularly enjoyed two posts this week: the "crack cocaine and heroine" post and the Mexican swap post. Also, RBN Energy on the Mexican swap.

From The Big Lebowski

Gasoline demand is hitting new all-time records. See this post.

The top stories in the Bakken this past week:

The Bakken -- update
One-sixth of the Bakken has been drilled
Bakken rig effectiveness
XTO reports several nice wells 
HRC reports a huge well in Eagle Nest
EOG, HRC, Whiting all report huge wells
Bakken update -- Mike Filloon

CBR volumes falling 

Portable frack-sand delivery systems

Good news for farmers in the Bakken 

Bakken economy
North Dakota's financial update 
Bakken utilities get new federal loans
Per-capita spending at Wal-Mart: ND in top ten

Bakken investors
Samson Resources seeks bankruptcy protection

Major permit numbering problem over at NDIC
When will the rigs come back? 

US Petroleum Demand Up In July -- OGJ, August 21, 2015; Production Hits Record Levels; Active Rigs Slump Over 50%

Earlier today I noted that 2007 must have been a pretty good year. Now this article pops up from The Oil & Gas Journal, dated August 21, 2015. As I read through this, all I can think of is the "crack cocaine and heroin" post the other day. The story at the link:
Total petroleum deliveries, a measure of demand, rose 2.2% from July 2014 to average nearly 19.6 million b/d last month.
“Demand for and production of oil and refined products grew across the board over the last year. In fact, demand for and production of oil and refined products were the highest July in 8 years, since 2007.”
Gasoline demand rose 2.1% last month from July 2014 to just above 9.4 million b/d, and distillate demand rose 1.1%.
US crude oil production increased 8.8% from July 2014 to an average of 9.5 million b/d—the highest July level since 1920. [Peak oil? What peak oil? Memo to Jane Nielsen.]
Natural gas liquids production averaged nearly 3.4 million b/d, marking the highest for the month on record and the new all-time record

According to the latest reports from Baker Hughes Inc., the number of oil and gas rigs in the US in July was 866, 53.8% below the year-ago level. Last month’s count was the second lowest count since January 2003.
US total petroleum imports in July averaged nearly 9.4 million b/d, down 1% from the previous year. Meanwhile, crude oil imports in July fell 5.5% from a year ago to average 7.2 million b/d.
At an average of nearly 10 million b/d, production of gasoline in July was the second highest level ever for the month.
Refinery gross inputs in July rose 0.1% from last year to a record high for the month at nearly 16.9 million b/d. The refinery capacity utilization rate in July averaged more than 90% for the fourth consecutive time this year at 94%.
API’s latest refinery operable capacity was 17.956 million b/d.
Crude oil stocks ended in July at nearly 460 million bbl, the highest July inventory level in 85 years, since 1930. Stocks of motor gasoline ended down 0.2% from last year to 216.5 million bbl. Distillate, jet fuel, and “other oil” stocks were up from year ago levels.
Flat out production, flat out refining, and gasoline stocks actually down 0.2% from last year. Apparently folks like inexpensive gasoline. I vaguely remember a chapter on elastic and inelastic demand in some economics course I took in high school. It now makes sense. Fifty years later.

A Completely Unnecessary Post -- But It Made My Day -- August 21, 2015


December 23, 2015: Vitol will be the first (?) to export US light crude oil under the relaxed rules on US exports. 
Original Post
This is one of those posts that is absolutely unnecessary but it helps me understand the global oil market. And it reminds me what contango means. It's not the Argentina national dance.

The link is here but requires a subscription. Vitol buys out oil tank partner's stake in VTTI BV for $830 million. Ah, but one can access it without a subscription through googling.

In a long note like this, there will be factual and/or typographical errors. If this information is important to you, go to the linked articles.

Some data points:
  • Vitol is the world's largest energy trader
  • with a purchase announced today, Vitol now has greater control of the global network of almost 400 crude oil tanks
  • a glut of crude oil globally has led oil traders to look for additional space to store supplies
  • access to oil storage facilities gives traders greater flexibility
  • Kinder Morgan and 3i infrastructure have also bought storage facilities in recent months
  • private equity players have been looking at a BP-owned terminal in Amsterdam
  • futures today suggest more oil may be moved into storage, allowing tank operators to earn higher fees
Why Vitol is in the news today:
  • Vitol paid $830 million for MISC Berhad's 50% stake in the VTTI BV oil storage business
  • buying the Petronas-controlled shipping group's half of hte venture gives Vitol greater control over a global network of almsot 400 tanks
  • VTTI currently has storage capacity of 35.5 million bbls (North America, United Arab Emirates, Amsterdam-Rotterdam-Antwerp oil hub, and in Malaysia)
  • VTTI started building a new facility in Cape Town in July; South Africa has emerged as an increasingly important way station for oil, with traders able to easily flip bbls east and west from that location depending on regional demand
  • South Africa's giant Saldanha Bay storage facility, 45 million bbls, was filled to capacity last month
A Bloomberg link here provides more background in a general sense. Some data points:
  • storage companies include Vopak NV, Kinder Morgan, Oiltanking GmbH, Magellan Midstream
  • US stock levels of crude oil at an 80-year high, 459 bbls, may soon test the limits of the US tank capacity
  • RBN Energy has provided updates on new storage facilities along the Gulf Coast
  • storage facilities take advantage of contango: a relatively rare situation in which forward prices are higher than current prices
  • recently, the one-year forward -- a measure of contango -- stood at a minus $12.59/bbl, close to the highest since crude prices started falling last year
  • generally, storage fees in the US run 20 to 50 cents/bbl/month
  • Vopak: world's largest independent oil storage company; owns 210 million bbls of crude oil/refined products; enough to supply German for three months
And this post has already paid off for me. Saldanha Bay was mentioned in the Bloomberg article. Until today, I had not heard of Saldanha Bay.

This little bit of trivia should make me a hit at tonight's social event. LOL.

XTO, Statoil With Nice Wells -- August 21, 205

Active rigs:

Active Rigs76193185197193

Four (4) new permits --
Fidelity renewed two wells, both in Mountrail County, a Hansen well and a Sandy well.

Whiting canceled a BSMU well in Billings County.

Four (4) producing wells were completed:
  • 29007, 2,009, XTO, David Federal 21X-20B, Lost Bridge, t8/15; cum --
  • 29006, 743, XTO, David Federal 21X-20E, Lost Bridge, t8/15; cum --
  • 29008, 1,908, XTO, David Federal 21X-20F, Lost Bridge, t8/15; cum --
  • 29483, 3,711, Statoil, Bures 20-29 5H, Alger, t7/15; cum --
Operator transfer -- Sedalia Energy transferred about 80 wells to Petro Harvester; all of these are older wells in Burke County; their permit numbers suggest they pre-date the Bakken. The few of them I looked at were Madison wells.

Rattlesnake Point

The Mountain Gap wells are tracked here Production data for Mountain Gap wells may not be updated on this page.

Current status:


2017 (conf in blue means they were SI/NC at one time; now back on conf)
  • 33579, conf, CLR, Mountain Gap 11-10H1, link here;
  • 33561, conf, CLR, Mountain Gap 12-10H, link here;
  • 33560, conf, CLR, Mountain Gap 6-10H1,
  • 33559, conf, CLR, Mountain Gap 5-10H, from FracFocus, fracked 12/12/17 - 1/8/18; 9.65 million gallons of water; water at 78% by weight; sand at 15% by weight; 
  • 33558, conf, CLR, Mountain Gap 4-10H2,
  • 33557, conf, CLR, Mountain Gap 3-10H,
  • 33556, conf, CLR, Mountain Gap 2-10H1,
  • 33123, conf, CLR, Mountain Gap 10-10H, link here;
  • 33122, conf, CLR, Mountain Gap 9-10H2,
  • 33121, conf, CLR, Mountain Gap 8-10H1, see update here; fracked 10/8/17 - 10/18/17; 10.4 million gallons of water; by weight, 85% water; 15% sand; link here;
  • 33120, conf, CLR, Mountain Gap 7-10H, see update here; link here;
  • 32781, 1,067, CLR, Bridger 11-14H1, 1,127 bbls over 4 days in 6/17; t12/17; cum 140K 6/18;
  • 32740, 1,485, CLR, Bridger 10-14H2, was a DUC; now on CONF; and 23,385 bbls in 8/17; t9/17; cum 202K 6/18;
  • 31847, 1,515, CLR, Bridger 9-14H1, was a DUC; now on CONF; and 33,124 bbls in 8/17; t8/17; cum 181K 6/18;
  • 31846, 1,389, CLR, Bridger 8-14H, was a DUC; now on CONF; and 32,268 bbls in 8/17; t8/17; cum 168K 6/18;
  • 31845, 879, CLR, Bridger 7-14H2, was a DUC; now on CONF; and 24,435 bbls in 8/17; t8/17; cum 174K 6/18;
  • 29713, IA, CLR, Thorvald 3-6H, Rattlesnake Point, t--; cum --
  • 29712, IA, CLR, Cuskelly 3-7H, Rattlesnake Point, t--; cum -- 
  • 29711, CONF, CLR, Cuskelly 4-7H1, Rattlesnake Point, t--; cum --; producing nicely; 
  • 29710, CONF, CLR, Thorvald 3-6H, Rattlesnake Point, t--; cum --; producing a bit
  • 29709, loc, CLR, Thorvald 5-6H2,
  • 29708, loc, CLR, Cuskelly 5-7H2,
  • 29554, 1,018, CLR, Bridger 4-14H2, t1/16; cum 278K 6/18;
  • 29553, 1,160, CLR, Bridger 5-14H, t9/15; cum 319K 6/18;
  • 29552, 1,977, CLR, Bridger 6-14H1, t9/15; cum 228K 6/18; jump in production after neighboring wells fracked;
  • 29551, 1,311, CLR, Bonneville 4-23H, 55 stages; 9/3 million lbs, t8/17; cum 143K 4/18;
  • 29550, 1,407, CLR, Bonneville 5-23H1, was a DUC; now on CONF; t8/17; cum 157K 4/18;
  • 29549, 1,518, CLR, Bonneville 6-23H1, was a DUC; now on CONF; and 10,023 bbls in 8/17; t8/17; cum 165K 4/18;
  • None
  • 22203, 1,430, CLR, Cuskelly 2-7H, t3/14; cum 174K 4/18;

June 27, 2018: huge Mountain Gap wells being reported. See this post.

October 22, 2017: lots of activity in this field in 7/17 - 8/17; data updated

August 22, 2015: see first comment --
Some interesting things going on with all these new wells you talk about. None of the nine new wells have ever been on confidential so you have access to their well files.
The 6-well pad is on a 2560-acre unit; the last three Bridger wells are on a 1280-acre spacing unit. The Bonneville wells are being drilled right now as 2 MB wells and 1 TF1 well. The Bridger wells appear to have been fracked? They are MB TF1 & TF2 wells. Oil has already been hauled off for two of the Bridger wells with the note on the form that this is NOT the first sale of oil, also noted something about coil tube sale? What does that mean?  [Comment: readers will have to weigh in; I do not know but I will see what I can find out.]
Of the new wells, same layout MB TF1 & TF2, it appears that they must be in a big hurry to drill as it looks to me like the day NDIC approved the permits the surface casing for all three had already been set? If I read the file correctly.
Also if you look in the new files the plan and profile for the wells on the drilling unit show a detail I don't think I have seen before. There are ovals drawn perpendicular to the well bore and the further north they go the larger they become. You suppose those ovals represent the frack effort they intend to achieve?
Also note on the gas capture form they estimate that the initial daily flow of oil, not counting gas, is just over 2,100 barrels a day each for all three. (I don't understand gas production numbers.) That would be a high IP rate for a CLR well let alone that rate for any period of time. Maybe for design purposes they overstate anticipated production? When you look at the area map of these wells you realize the north end of these wells are not far from the south end of a very special Whitman well in the Oakdale field. It will be interesting to follow over the next year or so to see how these wells turn out. [Comment: lots of observations and comments; I will do what I can. Hopefully, other readers will weigh in -- provide some thoughts.]

Original Post (August 21, 2015)

Rattlesnake Point is a very irregularly shaped field, fairly small (15 sections), and not very active except in a couple of locations. It is located in the northwest corner of Dunn County. The most active area is in section 23-146-96, in the southeast corner of Rattlesnake Point where there are no less than eleven (11) wells (or permits) currently sited and CLR added another three to this section on August 21, 2015, three more Bridger wells.

I track the Bonneville and Bridger wells here

NYMEX October Crude Oil Fell Under $40/Bbl -- August 21, 2015; Detroit: When Seconds Count, Count On Police Being There In Minutes

Tweeting now: NYMEX October crude oil fell under $40/bbl Friday, the first time the front-month contract has traded below that mark since March 2009.

Record Cold Across Central USA
Yes, This Is Weather, Not Climate

IceAgeNow is reporting:
15 to 25 degrees below late-August averages.
20 Aug 2015 – Denver set a daily record low of 47ºF on Wednesday, while Lubbock, Texas, dipped to a new daily record low of 57 ºF. [Remember, this is the middle of August.]
Oklahoma City dipped to 50ºF degrees on Thursday, beating its previous record for Aug. 20 of 56 ºF. This was only one degree shy of the all-time record low for the entire month of August set in 1915.
Wichita Falls, Texas, also set a daily record low on Thursday of 56 ºF.
The coolest high-temperature rankings also fell.
On Thursday, Texarkana, Arkansas set an all-time coolest high temperature for the entire month of August at 71 ºF.
Other locations setting daily record cold high temperatures on Thursday include Dallas, Texas (73 ºF), Waco, Texas (74 ºF) and Shreveport, Louisiana, with a high of only 76 ºF.
More cold on the way.
“Highs in the 50s and 60s will infiltrate parts of Montana, northern Wyoming and the western Dakotas on Saturday,” says “This is about 15 to 25 degrees below late-August averages.
“The cool air will then spread throughout the Plains and Midwest on Sunday, dropping high temperatures 10 to 20 degrees below average from the Texas Panhandle and central Oklahoma to the Dakotas and Minnesota.
Farmer's Almanac forecasts a very cold winter

Detroit's Top Cop: Get A Gun
When Seconds Count, The Police Will Be There In Minutes

Fox is reporting:
In a city plagued by chronic unemployment and crime and guarded by a dwindling police force, residents of Detroit are increasingly taking protection of themselves, their families and property into their own hands. Those who do so responsibly have the blessing and backing of Detroit Police Chief James Craig.
“When you look at the city of Detroit, we’re kind of leading the way in terms of urban areas with law-abiding citizens carrying guns,” Craig said recently.
The chief's call to arms, which first came in December, 2013, has been answered by thousands of men and women tired of being victims and eager to reclaim their beleaguered city. In 2014, some new 1,169 handgun permits were issued, while 8,102 guns were registered with city police - many to prior permit holders who bought new firearms. So for in 2015, nearly 500 permits have issued by the department and more than 5,000 guns have been registered.
Walt Disney Backstory

The backstory / inside story / whatever you want to call it -- how Walt Disney came upon the idea of Mickey Mouse, Disneyland, Snow White, and all the rest is in the "Epilogue" in Appetite for America, by Stephen Fried.

In addition, if one wants to get an interesting insight to visiting the Grand Canyon today, Fried provides an interesting essay in "Appendix I: The Grand Tour of Fred Harvey's America." He tells you when/how to make a reservation at perhaps the most coveted destination in the world.

"Appendix II: Meals By Fred Harvey" with 55 recipes, including how to make coffee, oatmeal cookies, and lobster.

Trivia from the epilogue, and these two appendices, will make you a hit at any social event, and perhaps even find a soulmate for the evening, assuming you are free to search.

Aubrey? He's Back -- In The Outback -- August 21, 2015; Algeria Setting Records In Decreasing CO2 Emissions; Perhaps Algeria Should Get Next Nobel Peace Prize

Bloomberg at Rigzone is reporting:
Aubrey McClendon, the wildcatter who pioneered the U.S. shale revolution by going where big oil companies wouldn’t, is at it again. This time in Australia.
Emboldened by the exodus of producers such as Chevron Corp. and Statoil ASA from Australian shale, McClendon and private- equity investor John Raymond are pouncing amid the rout in global crude prices and a dearth of other ready investors.
Australia is home to the world’s sixth-largest shale oil reserves and seventh-biggest tranche of shale gas
McClendon’s American Energy Partners LP is negotiating two acquisitions with a combined value of more than $160 million for Australian drilling rights that span an area the size of New York state. That followed the disclosure last week that Raymond’s Energy & Minerals Group agreed to invest in Pangaea Resources Pty.’s shale holdings in the country.
Chevron quit an Australian shale venture earlier this year as tumbling crude prices prompted the second-largest U.S. oil producer to conduct an internal reassessment of investment priorities. ConocoPhillips, Hess Corp. and Statoil ASA had already abandoned Australia’s shale patch by that point.
Brent crude futures, a benchmark for international oil prices, dropped 59 percent in the past 14 months as a flood of supply from North American shale and Persian Gulf fields overwhelmed demand.
McClendon’s American Energy signed a letter of intent and a three-month exclusivity agreement with Armour Energy Ltd. to acquire a 75 percent stake in 21.5 million acres (8.7 million hectares) of drilling rights, Brisbane, Australia-based Armour said in a statement on Thursday.
Armour shares surged as much as 70 percent after the announcement before closing 49 percent higher Thursday in Sydney.
Much, much more at the link.

Algeria In Economic "Crisis"

Platts is reporting:
New oil minister Salah Khebri, like his predecessor Youcef Yousfi, is convinced that something has to be done -- whether inside OPEC or in collaboration with non-OPEC countries -- and that the status quo is not sustainable.
For sure, Algeria has a lot riding on the oil price. [Well, duh.]
In January, Prime Minister Abdelmalek Sellal said Algeria was in a state of economic "crisis" and would defer a number of key infrastructure projects due to the falling oil price.
The dual impact of low prices and stagnant production means Algeria is among the world's oil producers most badly hit by the change in market dynamics: the price slide had resulted in a 45% drop in Algeria's quarterly revenue from oil and gas exports.
I don't know where else Algeria exports its oil, but this graph doesn't appear to have a lot of good news for Algeria:

This is not just low, this is record-setting low.

I would hope that President Obama recognizes Algeria for doing its part in decreasing CO2 emissions, either directly or indirectly. It appears Algeria is doing more to cut CO2 emissions than anything Algore has ever done.

Idiots -- August 21, 2015

The Dickinson Press reports that diesel is less expensive than gasoline. 
Stamart Travel Center manager Becca Neustel of Bismarck said she’d have to look back in the books to see the last time diesel fuel was lower than gasoline.
“It’s been a very, very long time,” she said.
The price for diesel at the station was $2.55 a gallon Thursday, 24 cents cheaper than regular unleaded gasoline.
In Dickinson, diesel could be purchased for $2.59 a gallon at multiple stations throughout the city. That was about 10 cents cheaper than super unleaded gasoline, the cheapest at the pumps.
In fact, according to the U.S. Department of Energy, the last time diesel was the cheapest fuel at the pump was 11 years ago in 2004. The department said the marker was reached in July when the average price of diesel nationwide dipped 2 cents a gallon below regular gasoline.
"According to the U.S. Department of Energy, the last time diesel was the cheapest fuel at the pump was 11 years ago in 2004." Fail. It was about six years ago, in 2009. 

It took about three seconds to google and find this from May 14, 2009:

 The story at the link:
As of Monday, May 11, 2009, the average price for a gallon of diesel fuel in the U.S. was $2.216, while the average price for a gallon of regular-grade gasoline was $2.240. That's a big deal, as diesel fuel has historically cost a least a bit more than premium gasoline here in the United States. Obviously, that trend is slowly changing. Towards the end of March, there were many areas of the country where diesel fuel was less expensive than gasoline, and today, that trend has taken hold on a national level.

Although this may seem like excellent news for automakers interested in selling diesel vehicles in the States, it has pretty much proven impossible to accurately predict what fuel prices will be more than a few weeks in advance. So, while it may seem likely that automakers would be more willing to bring efficient oil-burning cars to the American market in light of these favorable diesel prices, we wouldn't recommend getting your hopes up. However, if you already own a whirling derv, you may just have enough extra scratch at the end of the week to get yourself that cup of Starbucks.
"... enough extra scratch to get yourself that cup of Starbucks." Unlikely, since 2009, Starbucks has raised prices several times, and a small cup of coffee will now cost you over $2.00.

CAPEX Changes In 2Q15 May Surprise You -- RBN Energy -- August 21, 2015

The Dow could lose close to a 1,000 points in less than two weeks. The Fed admits it's out of ammo. Any bets that Janet Yellen will raise interest rates any time soon? 

EIA's "energy cookie":
Several states that produce large amounts of fossil fuels rely heavily on severance tax revenue—taxes based on the volume and/or value of oil, natural gas, coal, and other natural resources. On average, severance taxes accounted for less than 2% of state tax collections in 2014, but in three states—Alaska, North Dakota, and Wyoming—severance taxes provided a much larger share of total state tax revenue in that year. --- EIA
Active rigs:

Active Rigs76193185197193

RBN Energy: CAPEX changes in 2Q15.  (Archived)
With crude oil prices just over $40/bbl you might think producers would be reducing capex and cutting their 2015 production estimates.  But not so.  RBN’s analysis of second quarter guidance in 2015 indicates that 31 E&Ps as a group kept their capex outlook at about the same level as they indicated in Q1.  And as a group they still expect oil and gas production in 2015 to increase versus last year. But there were significant differences between the peer groups we examined. The Small/Mid-Size Oil-Weighted E&Ps upped 2015 investment by $730 million versus Q1 and now expect 2015 production to be up 16% over last year versus the 13% increase expected last quarter.  The Large Oil-Weighted E&Ps slashed capex by another $630 million, yet production is still expected to rise, in this case by 4% versus a 3% growth expectation last quarter.  In contrast, capital spending and production guidance were little changed among the gas-weighted peer groups. Today we provide an update to our Q1 analysis of capital spending and production trends.
Bloomberg asks the question, how long can Saudi Arabia last with oil prices this low. The article was not particularly enlightening; a pretty weak article for Bloomberg, but linking it here for the archives. I think the wrong question is being asked. Saudi Arabia can easily last for years with oil prices this low. The better question is whether OPEC is now dead except in name only?

For the archives. I don't know who sent me this or why they sent it to me, but it appears to be an interesting article on Minneapolis and a new incinerator. I never know where to file these links but I will simply link it here for now, for the archives.

Peak Oil? What Peak Oil? This Is Absolutely Insane -- August 21, 2015

It's been almost a year since Saudi Arabia shocked "us" with the announcement they were putting pedal to the metal, maximizing production to maintain market share. That was back in October, 2014. By March, 2015, pretty much everything was being delayed or curtailed and yet the glut of oil continues.

How bad is this glut of oil? Look at these two data points from EIA and other sources via Jack Kemp:
  • US refineries ran flat out over the summer (currently 95% capacity vs a 10-year average of 91%
  • US crude oil stocks can supply refiners for 27 days right now, compared to 10-year average of 23 days
It wouldn't seem that a 91% average is a whole lot different than 98%+ (full capacity) but, apparently it is, and apparently, it's a big deal.

And despite running flat out, refiners apparently cannot keep up with demand. With a glut of oil and with refiners at full capacity one would think gasoline would be under $2.00/gallon here in Texas, but it's not quite there yet (all things being equal, gasoline will go under $2.00/gallon by Christmas in Texas). But oil is well above $2.00/gallon here in Texas suggesting there is huge gasoline demand, and in fact, that's what the data tells us. Based on a casual observation of highway building, commercial development, and new residential sites, the economy appears to be booming in north Texas.

It's very likely gasoline demand will hit an all-time record in the US before the end of August. The most recent data available: US gasoline demand for the second week in August hit 9.705 million bopd; the record, I believe, was set in the third week of August, 2007, at 9.762 million bopd.
Re-posting from yesterday: Gasoline demand (a dynamic link: for most recent week, up slightly to 9.705 million bopd. The four-week average is down slightly to 9.604 million bopd. It's going to be tough to get to 10 million bopd but it's going to be close. I think the record was the third week in August, 2007, at 9.762 million bopd. 
If one thinks about it, it is absolutely insane.
The Japanese are setting new records for gasoline shipments and yet the pundits tell us that the Chinese and the Japanese economies are stagnating.

Everywhere else, particularly in the US, the pundits tell us everything is hunky-dory. Reuters tells us week-after-week how strong the labor market is in the US based on declining first-time claims for unemployment benefits. And yesterday -- just yesterday, the AP reported that US home sales in July soared to the fastest pace since early 2007.

2007 must have been a good year; I don't remember: home sales set a record; and, gasoline demand set an all-time record. I forget who was president then but it must have been Clinton, Bush, or Obama.

One Graph Worth A Thousand Energy Blogs