Notes From All Over, Part 1 -- September 23, 2019

EVs: two stories --

• after $5 billion in losses, Nio (also referred to as China's "Tesla") fight to survive -- September 23 2019, Bloomberg
• from one  year ago -- Warren Buffett has made a killing off China's biggest electric car maker, BYD Co. -- traded on the Hong Kong exchange -- Fortune, September 26, 2018

Global warming: St Greta spreads the climate gospel -- op-ed, WSJ -- September 20, 2019

The High Church of Environmentalism has acquired many of the characteristics of its ecclesiastical predecessor. An apocalyptic eschatology warns that we will all be consumed by fire if we don’t follow the ordained rules. The notion that it is our sinful nature that has brought us to mortal peril—from the Original Sin of a carbon-unleashing industrial revolution to daily transgressions with plastic bottles and long-haul flights—is as central to its message as it was to the Catholic Church’s. But repentance is near. A gospel of redemption emphasizes that salvation lies in reducing our carbon footprint, with reusable shopping bags and bike-sharing. The secular authorities preach the virtues of abstinence. Meatless Fridays are no longer just for Lenten observance.

UN and global warming, link here: https://www.foxnews.com/opinion/un-climate-change-save-the-world-meeting-daniel-turner.

Regardless of the science, or lack thereof, one thing is certain: in order to tackle climate change, the U.N. needs a lot of meetings.

"Time affluence": embracing "time affluence" can maximize vacation (or retirement) happiness -- wellandgood -- September 22, 2019. This is why I don't have bucket lists. 

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China Has Already Lost The Trade War

China and the trade war, a very interesting read.

Link: https://www.foxnews.com/opinion/helen-raleigh-china-lost-trade-war.

China exempted U.S. farm products, including soybean and pork, from additional tariffs, effective Sept. 17. This announcement was seen widely as a goodwill gesture ahead of the October trade talks between U.S. and China. But this seems to be a desperate, self-serving measure, because all the other pork exporting countries combined couldn't fill China's supply shortage. Simply put, China has a need of pork from the U.S., and its suspension from additional tariffs is, in essence, a tactical and indirect acknowledgment that it won’t be able to sustain this trade fight for much longer.

If China had hoped that it could simply wait until Trump loses the 2020 presidential election to get out of the trade war, it has to think again. At the most recent Democrat presidential debate, not a single candidate proposed to remove the trade tariffs Trump imposed on China. So even if Trump loses, China likely would not get someone friendlier in the White House.

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Recession Is Right Around The Corner

Recession is just around the corner: stock market's eerie parallels to September 2007 should raise recession fears -- MarketWatch -- September 21, 2019. Talking us into recession.

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US Crude Exports Set To Hit New High Into Year-End: HFIR

HFIR analysis of what the attack on Saudi means for oil. From a contributor to SeekingAlpha.

Summary:

• The majority of the investment community following the Saudi news is fixated on the total production outage, but the more important issue is the crude quality issue.
• What happens then is that the market will look for a replacement, and the only place in the world today with excess crude storage is the US.
• US crude export arb signals very elevated US crude exports into year-end.
• We are seeing ~3 to ~3.3 mb/d for US crude exports in October with an all-time high for November.
• This now opens up the possibility US crude storage falls to ~350 mbbls by year-end widening our expected WTI forecast from $70 to $85/bbl.

Narrative: 

Keep in mind that Arab light and Arab extra light have API gravity of 33 to 38. So the ultra-light US shale oil won't be a replacement, but rather the ~38 API gravity WTI will.

Now if you look at the crude export arb, US crude exports will hit an all-time high in November. What will the total volume be? We don't know just yet, but we know that October is going to range between ~3 to ~3.3 mb/d.

We are currently seeing 7 VLCCs waiting for loading in October (4 in the Gulf, 3 incoming).

This combined with Corpus Christi operating at max capacity filling Aframax leads us to believe that US crude exports will likely be closer to ~3.3 mb/d for October.

In the event that US crude exports do average that high and using a conservative refinery throughput figure, we have -4.86 mbbls for October US crude storage figures.

[As usual, "m" in this story equals million.]