How much have things changed?
Six months ago "everyone" was worried about another "rate hike" in early 2019. If at that time, Jerome Powell had said "no" rate hikes in 2019, the market would have surged.
Now, the talk has swung the other way: "everyone" sees the need/opportunity for a 25 point basis - 50 point basis cut in the "Fed rate."
So, today when Jerome Powell said he sees no need for cutting (or raising) the Fed rate, the Dow goes from 60 points in the green to 60 points in the red. Just for staying neutral.
And tomorrow his comments will be forgotten.
It's May: "sell in May, and go away."
The three "levers" that affect the overall market: 1) fiscal policy; 2) monetary policy; and, 3) trade.
By the way, speaking of which, the top bills passed by the 115th Congress so far:
And, we move on.
Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or think you may have read here.
Wednesday, May 1, 2019
65 Active Rigs In North Dakota; Rimrock With Eight New Permits; WTI Holds Above $63 -- May 1, 2019
WTI: despite staggering increase in US crude oil inventories, WTI holds above $63
Active rigs:
Eight new permits:
Active rigs:
| $63.62 | 5/1/2019 | 05/01/2018 | 05/01/2017 | 05/01/2016 | 05/01/2015 |
|---|---|---|---|---|---|
| Active Rigs | 65 | 61 | 49 | 29 | 86 |
Eight new permits:
- Operator: Rimrock Oil & Gas Williston, LLC
- Field: Mandaree (Dunn County)
- Comments: Rimrock has permits for an 8-well Skunk Creek / Two Shields Butte in section 24-149-93, Mandaree oil field
- 35373, 2,437, Whiting, Knut Berg Trust 41-28H, Pembroke, no production data;
Idle Chatter Regarding The Bakken -- May 1, 2019
I've been going through the wells that came off the confidential list in 1Q17. Some observations:
Apparently I'm not the only one.
After watching for the second time the Texas Rangers "closer" lose a game for the team, I was curious if anyone was talking about this debacle.
Yes. Over at google, 1.8 million hits asking the same question or something related.
Last night, the Texas Rangers were ahead 3-0 at the top of the 9th inning -- they were playing in Arlington, TX, just down the road from us.
The "closer" for the Texas Rangers simply had to keep the Pirates from scoring three runs in the top of the ninth.
Nope. The Pirates tied 3 - 3 at end of regulation and went on to win 6 (PP) - 4 (TR).
- these are huge wells; much different than the wells we saw in the earlier days of the boom
- wells are reaching 250,000 bbls or upwards of 400,000 bbls in two years
- the wells show the usual decline, but the decline is nothing like it was in the early days of the boom
- many, many wells are showing significant increased production due to impact of newly fracked neighboring wells
- older wells -- even two years old -- show remarkable return even after a small re-frack
- if the Permian is anything like the Bakken, the US shale revolution will be factors of 10 greater than what folks think the US shale revolution was going to be
- most of these older wells require little daily maintenance; little expense
- the major expense has been re-captured; it would be interesting to see the "margins" on these older wells (the price received for the oil vs the cost of producing it after the original CAPEX was spent)
- these wells will continue to produce for the next 30 years
- tier 1, tier 2, tier 3 will be defined by the price of oil, or to paraphrase Hemingway, "movable tiers"
***************************
The Sports Page
Apparently I'm not the only one.
After watching for the second time the Texas Rangers "closer" lose a game for the team, I was curious if anyone was talking about this debacle.
Yes. Over at google, 1.8 million hits asking the same question or something related.
Last night, the Texas Rangers were ahead 3-0 at the top of the 9th inning -- they were playing in Arlington, TX, just down the road from us.
The "closer" for the Texas Rangers simply had to keep the Pirates from scoring three runs in the top of the ninth.
Nope. The Pirates tied 3 - 3 at end of regulation and went on to win 6 (PP) - 4 (TR).
WPX Caribou Wells In Mandaree Off-Line -- May 1, 2019
Fracking operations in the area have recently been completed, it appears.
Affects these three WPX Caribou wells (as well as some Enerplus wells):
Affects these three WPX Caribou wells (as well as some Enerplus wells):
- #32677,
- #32678,
- #32679,
The Bakken Dreaded Decline Rate -- Re-Visited -- May 1, 2019
The well:
32736, 3,031, Newfield, Lost Bridge Federal 148-96-9-4-4HLW, Lost Bridge, t2/17; cum 373K 3/19;
Recent production. Regardless of "where" this well started, the fact that this well is still producing upwards of 12,000 bbls/month two years after it was fracked, speaks volumes how far "we"ve" come in the Bakken.
32736, 3,031, Newfield, Lost Bridge Federal 148-96-9-4-4HLW, Lost Bridge, t2/17; cum 373K 3/19;
Recent production. Regardless of "where" this well started, the fact that this well is still producing upwards of 12,000 bbls/month two years after it was fracked, speaks volumes how far "we"ve" come in the Bakken.
| Pool | Date | Days | BBLS Oil | Runs | BBLS Water | MCF Prod | MCF Sold | Vent/Flare |
|---|---|---|---|---|---|---|---|---|
| BAKKEN | 3-2019 | 31 | 11630 | 11836 | 13438 | 0 | 0 | 0 |
| BAKKEN | 2-2019 | 28 | 7113 | 6798 | 9697 | 9305 | 8044 | 1034 |
| BAKKEN | 1-2019 | 31 | 11447 | 11166 | 11433 | 15337 | 14748 | 314 |
| BAKKEN | 12-2018 | 31 | 10955 | 11821 | 12043 | 15581 | 14545 | 778 |
| BAKKEN | 11-2018 | 30 | 10687 | 10033 | 13437 | 14731 | 14136 | 340 |
| BAKKEN | 10-2018 | 31 | 12701 | 13012 | 15300 | 17774 | 17258 | 237 |
Why The Bakken Continues To Excite Me -- Thousands Of Wells Waiting To Be Re-Fracked -- May 1, 2019
Small re-frack; huge results.
See this post.
For newbies: current completion strategies, upwards of 10 million gallons of water or more. CLR re-fracks this well with 2 million gallons of water and gets this kind of return:
Those results are better than the original frack, the original well, two years ago:
I used to think that the re-fracks would be "reserved" for wells older than 2014, but here we go: a re-frack on a well that was just fracked two years ago. Literally thousands of Bakken wells that will be re-fracked.
See this post.
For newbies: current completion strategies, upwards of 10 million gallons of water or more. CLR re-fracks this well with 2 million gallons of water and gets this kind of return:
| Pool | Date | Days | BBLS Oil | Runs | BBLS Water | MCF Prod | MCF Sold | Vent/Flare |
|---|---|---|---|---|---|---|---|---|
| BAKKEN | 2-2019 | 28 | 19566 | 19462 | 25367 | 49381 | 48389 | 621 |
| BAKKEN | 1-2019 | 31 | 26040 | 26464 | 31398 | 54039 | 47776 | 5877 |
| BAKKEN | 12-2018 | 30 | 23141 | 22654 | 34189 | 35934 | 22812 | 12755 |
| BAKKEN | 11-2018 | 10 | 2743 | 2831 | 5489 | 2781 | 2648 | 79 |
| BAKKEN | 10-2018 | 31 | 11058 | 10920 | 28330 | 5220 | 4430 | 390 |
| BAKKEN | 9-2018 | 29 | 17070 | 17636 | 24454 | 29659 | 29275 | 0 |
| BAKKEN | 8-2018 | 8 | 4443 | 3854 | 3944 | 5354 | 4779 | 505 |
| BAKKEN | 7-2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| BAKKEN | 6-2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Those results are better than the original frack, the original well, two years ago:
| BAKKEN | 8-2017 | 31 | 665 | 622 | 2755 | 14116 | 14116 | 0 |
| BAKKEN | 7-2017 | 31 | 820 | 773 | 3825 | 1458 | 1363 | 95 |
| BAKKEN | 6-2017 | 21 | 569 | 606 | 3142 | 1216 | 1152 | 64 |
| BAKKEN | 5-2017 | 31 | 3430 | 3560 | 4965 | 7454 | 7454 | 0 |
| BAKKEN | 4-2017 | 30 | 16876 | 17168 | 12284 | 28288 | 28288 | 0 |
| BAKKEN | 3-2017 | 31 | 18615 | 18226 | 14841 | 31469 | 31469 | 0 |
| BAKKEN | 2-2017 | 14 | 16544 | 16159 | 10484 | 27151 | 27133 | 18 |
I used to think that the re-fracks would be "reserved" for wells older than 2014, but here we go: a re-frack on a well that was just fracked two years ago. Literally thousands of Bakken wells that will be re-fracked.
Definition Of Doofus -- May 1, 2019
We just can't drill our way to lower prices -- we also have to build pipelines. Gasoline is approaching $5.00/gallon out in California (or so I'm told by my brother-in-law) --
See these posts:
*****************************
Another Doofus
In midst of greatest measles outbreak in two decades, Buttigieg says he supports vaccine exemptions based on personal beliefs.
As someone noted, apparently science is not one of the 29 languages Buttigieg knows.
And, yes, he will try to walk back that comment.
Williston -- The Bakken Economy -- Led The State In Taxable Sales/Purchases GROWTH In 2018
Link here to The Williston Herald.
Awesome!
North Dakota's taxable sales, for the year, 2018:
Complete figures at "ND Tax."
But again, look at that growth, year-over-year. For Williston, a 26% annual growth rate. Dickinson, coming in at #2, was way behind, about half of what Williston's growth rate was.
Maybe The Atlantic will do a follow-up story to its big article back in 2016 or thereabouts in which the writers said the boom was over. I guess it all depends on the definition of "boom."
I'd like to pack this in and take you to the stars.
My Love For Evermore, Hillbilly Moon Explosion
Awesome!
North Dakota's taxable sales, for the year, 2018:
- Fargo:
- Williston: #2, passing Bismarck
- Bismarck:
- state: $20.24 billion; 12.54% increase over 2017
- state: the 12% annual growth rate is the largest year-over-year increase in taxable sales since 2012
- Williston: 26.17% year-over-year; #1 annual growth rate in the state
- Dickinson, #2: way behind at 14.10%
Complete figures at "ND Tax."
But again, look at that growth, year-over-year. For Williston, a 26% annual growth rate. Dickinson, coming in at #2, was way behind, about half of what Williston's growth rate was.
Maybe The Atlantic will do a follow-up story to its big article back in 2016 or thereabouts in which the writers said the boom was over. I guess it all depends on the definition of "boom."
I'd like to pack this in and take you to the stars.
Music -- Nothing About The Bakken -- May 1, 2019
A reader asked me about my music.
How can one not get re-energized with just this opening?
Lay Down (Candles In The Rain), Melanie, 1969
YouTube Fugue.
How can one not get re-energized with just this opening?
YouTube Fugue.
There was an 18-month-period, from late 1968 through mid-1970 that clearly had some of the best music ever. This was the year of Woodstock. The Beatles were still going strong, but touring less, and would soon stop completely. Led Zeppelin's first two albums, Zeppelin I and Zeppelin II, were released in 1969. The era of "free love" and the uncertainties of the Vietnam War probably contributed to some of this really incredible music.
Speaking of the Vietnam war, I turned 18 in 1969. My lottery draft was July 1, 1970; my lottery number was 103. The highest lottery number called for this group was 125; all men assigned that lottery number or any lower number, and who were classified as available for military service, were called to report for possible induction. I would have been deferred by virtue of being enrolled in college. I was worried that I would be called up before I graduated from college. I was convinced, but wrong, that the war would still be going on when I graduated from college.Some irony, that after all was said and one, a 30-year career in the USAF.
US Commercial Crude Oil Inventories Increased By A Whopping 10 MIllion Bbls -- May 1, 2019
9.9 million bbls to be exact.
EIA: US crude oil inventories rise to highest levels since September, 2017.
Ben Winkley: "US crude oil inventories large enough to be visible from space."
Refiners: cut back. weekly refinery utilization off 09%.
Anas Alhajji: tried to make a case for oil going from green to red after the EIA data released; in fact; oil stayed almost flat.
It will be interesting to watch the "spin" on this.
Had you paid for Z4 research, this is the data that was forecast earlier this week -- Z4 Research / Z-Man forecasts (from twitter):
WTI, later: holding at $63.41 -- folks suggest that the huge build is offset by the turmoil in Venezuela.
Re-balancing:
Somehow this week's numbers seem to be off slightly. If last week's inventory was 460.1 million bbls and this increase this week was 9.9 million bbls, then the inventory should be an even 470 million bbls. I must have made a typographical error.
EIA: US crude oil inventories rise to highest levels since September, 2017.
Ben Winkley: "US crude oil inventories large enough to be visible from space."
Refiners: cut back. weekly refinery utilization off 09%.
Anas Alhajji: tried to make a case for oil going from green to red after the EIA data released; in fact; oil stayed almost flat.
It will be interesting to watch the "spin" on this.
Had you paid for Z4 research, this is the data that was forecast earlier this week -- Z4 Research / Z-Man forecasts (from twitter):
- crude: up 0.9 million bbls (off by a factor of 10)
- gasoline: down 1.0 million bbls (initial report only said gasoline inventories increased)
- distillates: down 0.8million bbls (decreased by 1.3 million bbls)
- strong gasoline demand (pending)
- a drop in net imports (wrong)
WTI, later: holding at $63.41 -- folks suggest that the huge build is offset by the turmoil in Venezuela.
Re-balancing:
Week
|
Week Ending
|
Change
|
Million Bbls Storage
|
Week 0
|
November 21, 2018
|
4.9
|
446.9
|
Week 1
|
November 28, 2018
|
3.6
|
450.5
|
Week 2
|
December 6, 2018
|
-7.3
|
443.2
|
Week 3
|
December 12, 2018
|
-1.2
|
442.0
|
Week 4
|
December 19, 2018
|
-0.5
|
441.5
|
Week 5
|
December 28, 2018
|
0.0
|
441.4
|
Week 6
|
January 4, 2019
|
0.0
|
441.4
|
Week 7
|
January 9, 2019
|
-1.7
|
439.7
|
Week 8
|
January 16, 2019
|
-2.7
|
437.1
|
Week 9
|
January 24, 2019
|
8.0
|
445.0
|
Week 10
|
January 31, 2019
|
0.9
|
445.9
|
Week 11
|
February 6, 2019
|
1.3
|
337.2
|
Week 12
|
February 13, 2019
|
3.6
|
450.8
|
Week 13
|
February 21, 2019
|
3.7
|
343.8
|
Week 14
|
February 27, 2019
|
-8.6
|
445.9
|
Week 15
|
March 6, 2019
|
7.1
|
452.9
|
Week 16
|
March 13, 2019
|
-3.9
|
449.1
|
Week 17
|
March 20, 2019
|
-9.6
|
439.5
|
Week 18
|
March 27, 2019
|
2.8
|
442.3
|
Week 19
|
April 3, 2019
|
7.2
|
449.5
|
Week 20
|
April 10, 2019
|
7.0
|
456.5
|
Week 21
|
April 17, 2019
|
-1.4
|
455.2
|
Week 22
|
April 24, 2019
|
5.5
|
460.1
|
Week 23
|
May 1, 2019
|
9.9
|
470.6
|
Somehow this week's numbers seem to be off slightly. If last week's inventory was 460.1 million bbls and this increase this week was 9.9 million bbls, then the inventory should be an even 470 million bbls. I must have made a typographical error.
Saudi Arabia Update; EIA US Weekly Petroleum Report -- May 1, 2019
Saudi crude oil imports, US, link here:
Saudi Arabia foreign exchange reserves, link here, huge rebound:
EIA US weekly petroleum report, link here:
Somehow this week's numbers seem to be slightly off. If last week's inventory was 460.1 million bbls and this increase this week was 9.9 million bbls, then the inventory should be an even 470 million bbls. I must have made a typographical error.
Saudi Arabia foreign exchange reserves, link here, huge rebound:
EIA US weekly petroleum report, link here:
- US crude oil inventory: confirms API data yesterday; a whopping 10 million bbl increase;
- US crude oil inventory: at 470.6 million bbls, US inventories are at the five-year average; again, the EIA fails to say that the five-year average continues to increase; historically 300 million bbls in storage was more than adequate; 350 million bbls in inventory would suggest "successful" re-balancing; unless I'm missing something -- an increase of 10 million bbls in one week is not trivial; twitter will be going nuts in a few minutes
- refineries operating capacity at: 89.2% capacity; low end of general range
- imports: up by 265,000 bopd from previous week; at 7.4 million bopd
- gasoline and distillate production: within usual range
Week
|
Week Ending
|
Change
|
Million Bbls Storage
|
Week 0
|
November 21, 2018
|
4.9
|
446.9
|
Week 1
|
November 28, 2018
|
3.6
|
450.5
|
Week 2
|
December 6, 2018
|
-7.3
|
443.2
|
Week 3
|
December 12, 2018
|
-1.2
|
442.0
|
Week 4
|
December 19, 2018
|
-0.5
|
441.5
|
Week 5
|
December 28, 2018
|
0.0
|
441.4
|
Week 6
|
January 4, 2019
|
0.0
|
441.4
|
Week 7
|
January 9, 2019
|
-1.7
|
439.7
|
Week 8
|
January 16, 2019
|
-2.7
|
437.1
|
Week 9
|
January 24, 2019
|
8.0
|
445.0
|
Week 10
|
January 31, 2019
|
0.9
|
445.9
|
Week 11
|
February 6, 2019
|
1.3
|
337.2
|
Week 12
|
February 13, 2019
|
3.6
|
450.8
|
Week 13
|
February 21, 2019
|
3.7
|
343.8
|
Week 14
|
February 27, 2019
|
-8.6
|
445.9
|
Week 15
|
March 6, 2019
|
7.1
|
452.9
|
Week 16
|
March 13, 2019
|
-3.9
|
449.1
|
Week 17
|
March 20, 2019
|
-9.6
|
439.5
|
Week 18
|
March 27, 2019
|
2.8
|
442.3
|
Week 19
|
April 3, 2019
|
7.2
|
449.5
|
Week 20
|
April 10, 2019
|
7.0
|
456.5
|
Week 21
|
April 17, 2019
|
-1.4
|
455.2
|
Week 22
|
April 24, 2019
|
5.5
|
460.1
|
Week 23
|
May 1, 2019
|
9.9
|
470.6
|
Somehow this week's numbers seem to be slightly off. If last week's inventory was 460.1 million bbls and this increase this week was 9.9 million bbls, then the inventory should be an even 470 million bbls. I must have made a typographical error.