Monday, May 7, 2018

Obama Apologists Argue Trump's Tweets Won't Affect Global Oil Markets -- Oh, By The Way, WTI/Brent Are Surging -- May 7, 2018

From CNBC: Iran sanctions seen having limited impact on oil market if Trump scraps nuclear deal. Summary (note: one of the four bullets below was not written by CNBC, as far as I know):
  • President Donald Trump may restore sanctions on Iran later this week, putting the fate of the Iran nuclear deal in peril
  • however, analysts say the sanctions will only have a limited impact on the oil market because some importers like China and India will refuse to cut shipments
  • many analysts believe Trump can shrink Iranian shipments by 300,000 to 500,000 barrels a day, compared with the 1 million to 1.5 million barrels the Obama administration achieved
  • Trump says he has no plans to send Iran $400 million in unmarked $100 bills over the weekend
Scott Adams: "facts don't matter."

Huge thank you to Don for sending me the link. My reply:
What is not made clear is whether Trump's 500,000 bbls is "ON TOP" of Obama's 1.5 million bbls or whether they are two separate numbers, which I believe they are (two separate numbers).

At the end of the day, no one really knows how much oil Iran is producing or selling. 
Our own API and EIA can't even get the same numbers for weekly US crude inventories, released one day apart. Does one truly think anyone outside of Allah knows how much crude oil Iran is producing, consuming, exporting? LOL.

And whether it is 1.5 million OBAMA barrels or 300,000 TRUMP bbls, neither number has any effect on a global market of 100 million bbls production. Shutting down the DAPL would pretty much shut down much of North Dakota and the world would notice that either.

Having said all that, the CNBC guy who wrote that article must not have looked at the oil market today: WTI is going up nicely and if the CNBC guy had looked at my equity portfolio he/she would see that I am quite happy with whatever effect Trump's tweets are having on the market.
WTI? Solidly over $70 now. Brent? Solidly over $75.

ConocoPhillips Appears Ready To Take Control Of Venezuelan Oil Sector Assets To Enforce $2 Billioin Arbitration Award -- May 7, 2018

From SeekingAlpha:
  • ConocoPhillips has moved to take Caribbean assets of Venezuela’s PDVSA oil company to enforce a $2B arbitration award, actions that could further harm PDVSA's declining oil production and exports
  • COP has targeted facilities on the islands of Curacao, Bonaire and St. Eustatius that accounted for ~25% of Venezuela’s oil exports last year and play key roles in processing, storing and blending PDVSA’s oil for export
  • COP’s actions could further impair PDVSA’s declining oil revenue and Venezuela's collapsing economy; the country is almost completely dependent on oil exports, which have fallen by a third since its peak and its refineries ran at just 31% of capacity in Q1
See post, May 5, 2018, just two days ago.

Global Warming? What Global Warming?

June 1, 2018, we start the "new" global warming tag.

The Market, Energy, And Political Page, T+68 -- May 7, 2018 -- Absolutely, Positively, The Scariest Quote This Past Weekend

Blogging may be a bit minimal for awhile. I'll be traveling this week but I think I will have plenty of time to blog. We'll see.

Prescient? Absolutely, positively, what was the single scariest quote all weekend, and who made the quote? The link is here. Answer at bottom of this post (scroll down for answer).

Making America great again. This caught me by surprise. I don't watch much television but occasionally catch CNBC while getting ready in the morning but everything I've been hearing on CNBC suggests that publicly traded companies have been using their Trump Tax windfall for buying back company shares. Then I see this from another source:

I only caught ten minutes of CNBC this morning: Becky Quick interview Bill Gates, Charlie Munger, and Warren Buffett on health care. Incredibly lame Q&A.

Quick: what is the #1 reason why government health care programs like Medicare and ObamaCare costs can never be estimated or contained? The military can mitigate this problem to some extent.

Answer to scariest quote this past weekend:
Charlie Munger: "There will come a time when the people who hate Trump will wish that he was back.”

Monday, May 7, 2018 -- NOG Releases Earnings -- Beats Forecasts On Bottom Line

Blogging may be a bit minimal for awhile. I'll be traveling this week but I think I will have plenty of time to blog. We'll see.

Enerplus reported three nice Antelope-Sanish wells; XTO with two more DUCs.

NOG Releases 1Q18 Results, Guidance

Link here.
  • daily production increased 35% year-over-year; increased 7.5% sequentially; ~ 18,000 boepd
  • ended the quarter with 19 net wells in process; added 5.8 net wells to production; added 6.5 wells to drilling and completing list
  • raising full year guidance (2018) by 26 - 30% over 2017 vs prior guidance of 18 - 22% (estimates do not include the recently announced Salt Creek acquisition  -- see link)
  • production expenses per boe: 
    • 1Q2018: $7.71
    • 1Q2017: $9.75
  • G&A expense
    • 1Q2018: $1.03
    • 1Q2017: $3.02
  • net income  
    • 1Q2018: $2.965 million
    • 1Q2017: $16.941 million
  • net income per share
  • In early morning trading after results released: NOG up almost 11%
Disclaimer: I make a lot of simple arithmetic errors. I often see things that do not exist; I read quickly and miss important points. Sometimes it takes me days (maybe even weeks) to see where I was wrong.

Disclaimer: this is not an investment site. Do not make any investment, financial, job, relationship, or travel decisions based on what you read here or what you think you may have read here. 

Permian's Natural Gas Problem -- Same As The Bakken Early On -- May 7, 2018

Active rigs:

Active Rigs62492785191

RBN Energy: Permian gas prices collapsing as production tests takeaway capacity limit.
Production of crude oil and associated gas in the Permian continues to rise, despite pipeline takeaway constraints that have widened crude spreads and depressed natural gas prices at the Waha Hub.
But while oil can be — and is being — transported by trucks and railroads when crude pipelines are full, natural gas needs to be either piped away or flared, and Permian gas production is now approaching the effective maximum takeaway capacity out of the basin. While a slew of new projects have been announced to relieve the Permian gas takeaway problem, the new capacity won’t arrive soon enough to keep Permian production from hitting the takeaway-capacity wall sometime in 2019.  Today, we begin begins a series examining Permian production trends and their implications for pipeline flows and pricing in Texas.

WTI Hits $70 -- May 7, 2018