Wednesday, July 3, 2019

Idle Rambling, Independence Day Eve -- The ADP Employment Report Today; The Record S&P -- July 3, 2019

Recession talk. 

A reader pointed me to Advisor Perspectives.

This is a nice analysis of the ADP employment report today.

This is the graph with minimal markings. Spend some time looking at this graph while reading the linked article.

Two comments regarding that linked article.

First, for the past five years, analysts have been talking about a "recession right around the corner." Some analysts suggest we are already in a recession. My interpretation of the graphic above suggests we are a) not in a recession; and, b) a recession is not "right around the corner."

This is based solely on the ADP employment report today and the comparison of this data with the data prior to and during the last recession.

The second observation, "why the market went up today," with the S&P 500 hitting a third consecutive record high:
  • the ADP employment report, as good as it was, fell short of expectations
  • if the economy is struggling that puts pressure on "the Fed" to cut rates
  • investors are looking for any data to suggest that the economy is not doing as well as one might hope
  • with the ADP coming in under expectations (quite a bit, in fact) that puts pressure on the Fed to cut rates 
  • cutting rates is "bullish" for the stock market -- and that's why the market went up today, the third consecutive day with record highs
Finally, the graphic with some additional markings:

And I would comment on the additional markings, but it's late, and I'm heading to bed.

Keeping America Great -- Longest Expansion In US History -- Stock Market At All-Time High -- July 3, 2019

I missed this earlier this week -- how did that happen? Oh, that's right. I'm on vacation, haven't been following the news. I assume ABC, CBSNBC, MSNBC, and, CNBC had this covered.

From google:

Link here.

And then this,

Airport Construction On Schedule But Adequate Cement Is An Issue -- July 3, 2019

Link here.

Nip and tuck.

On track to open October 10, 2019, but due to flooding, adequate cement for the new Williston airport is a challenge. Officials have alternate sources of cement but not without a lot of quick thinking/quick acting.

From the linked article:
Officials at the Williston Basin International Airport are breathing a sigh of relief as a temporary solution for the facility’s ongoing cement shortage has been found.

The airport has been dealing with a lack of cement needed to complete projects at the site, most notably the runway and taxiway. Flooding in Missouri, where the supplier is located, has created a cement deficiency not just for Williston’s airport project, but for companies all across the upper Midwest.

Airport Director Anthony Dudas said the runway is a “critical timeline piece” to complete, as the paint markings and runway edge lighting must be completed before the FAA can do the required flight checks on it.
Dim Sum In London

XTO To Build Gas Plant In Williams County -- July 3, 2019

Link here. Data points:
  • Williams County: approves permit, 4 - 1
  • XTO
  • "gas plant": 150 million cubic feet per day
  • neighbors had objected
  • Planning and Zoning Commission: a tie vote (generally means a "No" for the county)
  • 76 acres in Judson Township
  • permit includes an outline for an adjacent future plant if the company plans to expand
Judson Township: first township west of Williston Township, either side of US 2; west of Judson is Round Prairie whose western border is the Montana state line.

Natural gas processing plants in North Dakota are tracked here.

It appears this would be XTO's second gas plant in North Dakota. The XTO plant in Ray, ND, has a nameplate capacity of 25 million cubic feet per day.
Fantasy Land

From moneyrates, a PDF will load on your desktop.

More Fun On The Water

A Musical Interlude

Most of you may just want to skip ahead to 5:58:

I Can't Help Falling In Love With You, Arlo Guthrie

Equinor With Six New Permits East Of Williston -- July 3, 2019

Active rigs:

Active Rigs5966573076

Fourteen new permits:
  • Operators: Equinor (6); Hess (5); XTO (3)
  • Fields: Catwalk (Williams); Williston (Williams); Avoca (Williams); Beaver Lodge (Williams); Bear Creek (Dunn)
  • Comments: 
    • Equinor has permits for a six-well Lucy Hanson / Larsen pad in section 15-154-100; multiple fields; 
    • Hess with permits for a 5-well BL-Iverson pad in section 26-155-96, Beaver Lodge oil field
    • XTO with permits for a 3-well Mariner pad in section 36-148-96 in Bear Creek oil field 
Four producing wells (DUCs) reported as completed:
  • 34920,  883, XTO, Christiana 21X-6F, West Capa, t5/19; cum --;
  • 34917, 1,201, XTO, Christiana 21X-6EXH, West Capa, t6/19; cum --;
  • 34919, 1,028, XTO, Christiana 21X-6AXB, West Capa, t6/19; cum --;
  • 34918, 1,206, XTO, Christiana 21X-6A,West Capa, t6/19; cum 8K over 20 days;

Making America Great -- A Hat Trick, Today? -- July 3, 2019


July 4, 2019: S&P 500 hits all-time record high. Third consecutive day of record highs.
  • Dow 30: 26,966, +170 (a 52-week high; possibly an all-time high?)
  • S&P 500: 2,995.82, +22.81 (record high)
  • Nasdaq: 8,170, +61.14 (52-week high: 8,176)

Original Post

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 what you think you may have read here.

Hey, are we having fun or what! That's what Sophia said to me the other day -- on the lake ... but look at this -- the S&P 500 hit all-time records on two consecutive days -- could traders make it a hat trick? A third consecutive day? The S&P is up 9 points right now, or about 0.3% on a short trading day. It's 10:19 a.m. ET, and the markets will close at 1:30 p.m. ET today. So, we'll see, as the president would say.

Weekly EIA US Crude Oil Data -- July 3, 2019

US weekly crude oil inventory data, EIA: link here.
  • weekly change: decreased by 1.1 million bbls (WTI unchanged at $56.88)
  • US inventories: 468.5 million bbls; 5% above five-year average
  • refiners operating capacity: 94.2% -- about "right"
Week 0
November 21, 2018
Week 1
November 28, 2018
Week 2
December 6, 2018
Week 3
December 12, 2018
Week 4
December 19, 2018
Week 5
December 28, 2018
Week 6
January 4, 2019
Week 7
January 9, 2019
Week 8
January 16, 2019
Week 9
January 24, 2019
Week 10
January 31, 2019
Week 11
February 6, 2019
Week 12
February 13, 2019
Week 13
February 21, 2019
Week 14
February 27, 2019
Week 15
March 6, 2019
Week 16
March 13, 2019
Week 17
March 20, 2019
Week 18
March 27, 2019
Week 19
April 3, 2019
Week 20
April 10, 2019
Week 21
April 17, 2019
Week 22
April 24, 2019
Week 23
May 1, 2019
Week 24
May 8, 2019
Week 25
May 15, 2019
Week 26
May 22, 2019
Week 27
May 30, 2019
Week 28
June 5, 2019
Week 29
June 12, 2019
Week 30
June 19, 2019
Week 31
June 26, 2019
Week 32
July 3, 2019

In Trail

Rigs Matter -- For the Oil Service Companies -- July 3, 2019

Link here to Bloomberg.
For the oilfield services industry, it’s no longer about merely navigating a downturn. It’s now about survival.
Five years after crude began its plunge to less than $30 a barrel from more than $100, the companies that drill and frack wells are living in a new world. The producers they work for have become increasingly efficient and cost-conscious, reacting to shareholder demands for payback and a crude market that’s recovered only part of that brutal decline.
Meanwhile, the service companies that handed out discounts in the downturn are barely holding on. Schlumberger Ltd. and Halliburton Co., the two biggest, have each fallen by more than 65% since crude started tumbling, and Weatherford International Plc on Monday filed for bankruptcy. Contrast that with the oil producers, collectively down less than 50%.
When crude began recovering in March 2016, the servicers started refortifying. But with their customers keeping a lid on spending, the gear began to pile up. In February, Rystad Energy, an industry consultant, estimated that supplies of U.S. fracking gear -- the pumps that blast water, sand and chemicals underground to release crude in what has become the most expensive part of drilling -- will exceed demand by about 68% by year’s end.
At the same time, producers have enjoyed an output boom in recent years, doing more with less by using new methods and technology. Shortened horizontal drilling times and longer laterals that require fewer wells to be drilled are taking a toll on servicers.
In June 2014, the U.S. pumped 8.4 million barrels of crude using 1,545 drilling rigs. Last month, it produced about 12.2 million barrels, 45% more, with just 788 rigs.
Pretty much says it all.

From twitter, later today:


Six-year-old in front. Five-year-old (birthday earlier this week) in back. Flathead Lake, Montana.

Liberty Resources Fracks Bakken Well With 16 Million Lbs -- July 3, 2019

Wells coming off the confidential list today -- Wednesday, July 3, 2019: 4 for the month; 4 for the quarter;
  • 35371, 889, Liberty Resources, Patricia W 159-94-12-24-2MBHX,  North Tioga, t1/19; cum 94K 5/19; 40 stages; 16 million lbs sand (no typo); see graphic below;
  • 35322, SI/NC, MRO, Eunice USA 11-16TFH, no production data,
Active rigs:

Active Rigs5966573076

RBN Energy: could all sides win in Pennsylvania's Laurel pipeline case?
For a few years now, Buckeye Partners’ plan to revise the current east-to-west refined products flow on its Laurel Pipeline across Pennsylvania has pitted Midwest refiners against their Philadelphia-area brethren — and gasoline and diesel marketers in western Pennsylvania. Each side has good arguments. Midwest refiners note that westbound volumes on Laurel have been declining through the 2010s, and assert that making the western part of the pipeline bidirectional would result in higher utilization of the line and enhance competition in central Pennsylvania, Maryland and eastern West Virginia. Pittsburgh-area marketers counter with the view that allowing refined products to flow east on a portion of Laurel would hurt competition in Pirates/Steelers/Penguins Country, while Philly refiners — their ranks now thinned by the planned closure of the fire-damaged Philadelphia Energy Solutions (PES) facility — say Buckeye’s plan would further threaten their economic viability. Amid all this, might there be a “perfect-world” solution? Today, we provide an update on this still-in-limbo project and discuss a few possible paths forward.
Practically A Wildcat

The well (from above):
  • 35371, 889, Liberty Resources, Patricia W 159-94-12-24-2MBHX,  North Tioga, t1/19; cum 94K 5/19; 40 stages; 16 million lbs sand (no typo);
The graphic: