Wednesday, January 20, 2016 -- John Kemp Talks About North Dakota

From Rigzone/Reuters, John Kemp: North Dakota's Steady Production Shows Why Market Rebalancing Is Hard:

North Dakota's oil production has been flat for more than a year, but it hasn't fallen despite the sharp drop in prices, illustrating the challenges of rebalancing the oil market.

Output first hit this level September 2014 and has been essentially unchanged for the last 15 months, the longest and deepest pause in growth since the shale boom began.

The reduction in actual output of around 450,000 bpd compared with the previous trend is a measure of how far lower oil prices have already gone towards rebalancing the market. But most analysts and forecasters expected the state's crude output to have fallen sharply by now rather than just to have levelled off.

Shale production was supposed to respond much faster to declining prices because it required the drilling of a large number of new wells to offset rapid decline rates from old ones. Instead, shale output has proved unexpectedly resilient, as producers have found ways to maintain output while slashing drilling and costs.

Best story of the day from The Wall Street Journal: where America's millionaires live. Although the story is about a city on the east coast, the last paragraph:

Among states, North Dakota recorded the fastest growth in millionaires in June 2015 from a year earlier, increasing more than 10%.

There is a great graphic at the link. North Dakota was #1. Idaho, #2; Montana, #3; and, Oregon, of all things, #4. Rounding out the top five, Florida.

In other news we wake up to this:

• President Obama appoints another tzar: this one to provide him updates on Flint, Michigan, lead-contaminated water.
• 83 Detroit, Michigan, schools closed today: "sick-out." Not related to norovirus/Chipotle stories. President Obama will likely appoint another tzar to provide him updates on Detroit school closing. 
• US tightens eligibility rules to enroll in ObamaCare -- more on this at this post.
• Japan in bear market; all indications that US will follow.
• After seven years of slow growth, US now sees more of same. "That's why I started raising interest rates," Janet Yellen.
• Bad days for Wal-Mart Americans -- Holman W. Jenkins, Jr, Wall Street Journal. I still think this story is blown out of proportion. The company is closing 102 small stores; will build 270 large stores this fiscal year. Wal-Mart says it can't turn a profit with minimum wages at $15/hour; even $11.50/hour is problematic.
• Could there possibly be a worse photo of Sarah Palin out there than the one on the front page of the on-line edition of the WSJ today?
• Driver's licenses lose allure for young. For some reason this non-story continues to be reported. It's not as if it's a slow-news day. ISIS destroys Iraq's oldest Christian monastery to trail of destruction. Note: this was in Iraq. The country the US liberated, only to see it fall when the US abruptly left. Of course, the Iraqis themselves wanted us out. We were more than willing to leave.
• Global stocks tumble as oil prices hit 12-year low. Dow off more than 300 points in pre-market trading.
• EU refugee crisis continues to snowball. 

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