Friday, December 27, 2019

EIA Reports 5.5-Million-Bbl Draw; WTI Unchanged; No NDIC Activity Reported -- December 27, 2019

EIA's daily petroleum report:
  • US crude oil in storage decreased by 5.5 million bbls from the previous week
  • US crude oil now in storage stands at 441.4 million bbls
  • refiners are operating at 93.3% capacity; trending up, following recent scheduled maintenance (?)
  • jet fuel product supplied was up almost 7% compared with same four-week period one year ago
Re-balancing, at 441.4 right where we were in week 5, one year ago, December 28, 2018 --

Week Ending
Million Bbls Storage
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
441.4  ****
Week 49
October 30, 2019
Week 50
November 6, 2019
Week 51
November 14, 2019
Week 52
November 20, 2019
Week 53
November 27, 2019
Week 54
December 4, 2019
Week 55
December 11, 2019
Week 56
December 18, 2019
Week 57
December 27, 2019
441.4  ****

Gasoline demand: unremarkable --

Back to the Bakken

Active rigs:

Active Rigs5667514162

No activity reported today. however "permit applications received within the areas of interest":
  • Slawson: six permit applications
    • location: section 23-152-92
    • Mountrail County
    • two Tempest Federal permits; four Orca Federal permits
    • map suggests location off ND State Highway 23 midway between New Town and Van Hook Travel Center

Mega-Fracks -- Slawson -- December 27, 2019

Years ago, maybe four years ago, maybe longer, we talked about 60-stage fracks as being huge. I don't remember if I talked about anticipating 94-stage fracks. Things just move too quickly in the Bakken. Sometimes. 

The wells:
  • 32274, 2,117, Slawson, Submariner Federal 2 SLH, 31 stages; 2.6 million lbs; 63 stages; 13.8 million lbs; Big Bend, t6/19; cum 73K 10/19; 
  • 32276, 433, Slawson, Gobbler Federal 4-26-35MLH, 46 stages; 9.6 million lbs; 46 stages; 9.8 million lbs; Big Bend, t6/19; cum 20K 10/19; 

Recently Completed Staggering Wells -- December 27, 2019

When I look at the results of these wells, I wonder what the authors of this report think (the "Saudi analysis"). 

From new wells reporting, 4Q18.

The wells:
  • 34399, 2,684, WPX, Lion 18-19HB, 33 stages; 8.3 million lbs; Mandaree, t7/19; cum 134K 10/19;
  • 34486, 1,244, XTO, Nelson Federal 21X-5BXC, Antelope-Sanish, t3/19; cum 159K 19/19; 
  • 34050, 3,562, MRO, State Oster 14-36TFH, 45 stages; 5.9 million lbs; Bailey, t4/19; cum 71K 10/19; memo to self: check map on this one;
  • 34049, 4,527, MRO, State Kreiger 14-36h, Bailey, t7/19; cum 150K 10/19; memo to self: check map on this one;
  • 33870, 4,149, MRO, Arthur 24-35H, Bailey, t5/19; cum 144K 10/19; ; memo to self: check map on this one;
  • 34366, 1,615, XTO, Cherry Creek State 14X-36AXD, Siverston, t3/19; cum 156K 10/19;  
  • 33869, 3,132, MRO, Wickett 24-35TFH, Bailey, t4/19; cum 125K 10/19; 
  • 34262, 4,136, MRO, Yellow Otter USA 14-7TFH, Reunion Bay, t2/19; cum 214K 10/19;  
  • 32959, 916, Oasis, Ceynar 5298 44-32 14TX, Banks, a DUC but still huge production being reported, t5/18; cum 195K 10/19; 
  • 32958, 574, Oasis, Ceynar 5298 44-32 15BX, Banks, a DUC but still huge production being reported, t5/18; cum 232K 10/19; 
  • 34451, 2,946, MRO, Greybull USA 31-18TFH, Van Hook, t3/19; cum 217K 10/19;  
  • 34450, 4,038, MRO, Berry USA 21-18H, Van Hook, t3/19; cum 296K 10/19;  
  • 32530, 308, Petro-Hunt, USA 153-95-4A-9-7H, Charlson, t1/19; cum 210K 10/19; 
  • 34666, 6,012, MRO, Northrop 34-16H, Jim Creek, t11/18; cum 190K 10/19, see this post.
  •  34449, 3,332, MRO, Grant USA 21-18 TFH, Van Hook, t9/18; 199K 10/19;
  • 34667, 5,713, MRO, Veddy 44-16H, Jim Creek, t10/18; cum 259K 10/19, see this post
  • 34668, 6,640, MRO, Drake 44-16H, Jim Creek, t11/18; cum 228K 10/19, see this post
  • 30824, 2,649, WPX, Behr 19-18H1, Reunion Bay, t7/18; cum 102K 8/18; 41 stages; 6 million lbs, huge well, 100K in less than 2 months;
  • 34140, 2,126, WPX, Raptor 13-24HEL, Reunion Bay, t11/18; cum 346K 10/19;

Notes From All Over, Part 3 -- December 27, 2019

First things first: Netanyahu quashes Likud leadership in landslide. On heels of Boris. Still a year away but a trifecta? With a Trump landslide?

FOMO. Headline over at the LA Times today -- "Stocks soared this year. Half of millennials missed out."
Although the market is poised to close a banner year hovering near record highs, the rally hasn’t helped half of the nation’s millennials, who either lack the means to knock on Wall Street’s door or are wary of doing so.
In the last two years, an average of 49% of millennials (ages 23 to 38) held stock directly or through mutual funds, exchange-traded funds or retirement plans such as 401(k)s at any given time, according to polling data that Gallup provided at The Times’ request.
That’s down sharply from an average 61% of Americans in the same age range in the 2001-2008 period, before markets were hammered by the financial crisis of 2008-09, an event that’s still one reason many millennials steer clear of equities, analysts said.
Millennials, now entering their prime earnings period, hold vastly less wealth than generations that preceded them. And the wealth gap between older and younger generations is widening. An analysis by the St. Louis Fed showed that in 1989, the median wealth of households led by people ages 65 to 75 was nearly eight times as large as the wealth of families headed by 25- to 35-year-olds. By 2016 the median baby boomer-led household had nearly 13 times as much wealth as the typical millennial household.
That’s in part due to the financial crisis that shaped the economy during millennials’ formative years — and the habits and fears they adopted at that time have, to some extent, kept them away from this year’s runaway market success.
“They’ve been tarnished by the damage that Wall Street did 10 years ago, and it’s in their psyche,” said Steve Nielander, a San Diego State finance lecturer and a partner at wealth management firm Cerity Partners.
As a result, they missed the market’s best performance in six years and the 11th year of the ongoing bull market that followed the crisis. Investors bid up prices despite the ongoing U.S.-China trade war, political turmoil surrounding President Trump and fears of an economic slowdown.

Notes From All Over, Part 2 -- December 27, 2019

This should have been the lede in this CNN Business news story: China's industrial profits rose 5.4% in November from a year earlier, reversing a 9.9% plunge in October, government statistics showed Friday morning.

Is this the reason behind pre-market trading right now? The article was posted at 3:48 a.m. ET, this morning, December 27, 2019.

Yesterday, midday, from CNBC yesterday: stocking making the biggest moves -- Amazon, Apple, Marathon Oil.
  • AMZN: Shares of Amazon jumped 4.5%, leading the gains in the S&P 500, after the e-commerce giant said it has just had its best holiday shopping season ever. Amazon said in a statement that “billions” of items were ordered worldwide and “tens of millions” Amazon devices were purchased.
  • MRO: Shares of the exploration and production company gained 0.5% as oil prices hit a 3-month high. Apache, Occidental, ConocoPhillips and Diamondback were among the other energy names up more than 1% as trade hopes and a drawdown in U.S. inventories fueled oil’s gain.
Which reminds me, how is MPC doing?

MPC: down fifty cents yesterday, almost a percent; not trading yet today; raw product getting more expensive to buy; should be able to pass on costs to consumer;

As a reminder, from wiki:
Marathon Petroleum Corporation is an American petroleum refining, marketing, and transportation company headquartered in Findlay, Ohio. The company was a wholly owned subsidiary of Marathon Oil until a corporate spin-off in 2011.
Following its acquisition of Andeavor on October 1, 2018, Marathon Petroleum became the largest petroleum refinery operator in the United States, with 16 refineries and over 3 million barrels per day of refining capacity.
Marathon Petroleum ranked No. 41 on the 2018 Fortune 500 list of the largest United States corporations by total revenue.
Back to Amazon. Simply blows me away. It seems the press can't get enough of the negative stories about Amazon: working conditions; theft by employees delivering packages; monopoly; never making a profit; yada, yada, yada, but as a consumer, it certainly seems Amazon didn't miss a beat this holiday season. I forget what it was, but Amazon added another perk for those who subscribe to Amazon Prime. I think this was it, saving money on streaming:
Best streaming services here

Quick: what is the etymology of "mogul" -- powerful person, not the term for a bump on the ski slope. 

If You Have Time To Read Only One Article Today, This Would Be It -- If You Like Russian Submarine Stories -- December 27, 2019

Is there a future for Russian aircraft carriers? Zerohedge.
  • some good writing
  • some typos, for example:
    • the only shipyard in the USSR which could built (sic) such a huge ship
    • so why built (sic) such an expensive target,
  • the article begins, humorously enough:

    • Those following the news from Russia have probably heard that Russia’s only aircraft carrier, the Admiral Kuznetsov (official name: Admiral of the Fleet of the Soviet Union Kuznetsov), was put into dry dock for major repairs and retrofits. Things did not go well. 
      First, the dry dock sank (it was Russia’s biggest) and then a huge crane came crashing down on the deck. 
      And just to make it even worse, a fire broke out on the ship killing 2 and injuring more. With each setback, many observers questioned the wisdom of pouring huge sums of money into additional repairs when just the scheduled ones would cost a lot of money and take a lot of time.

  • article originally posted here
  • about The Saker here; seems to fit to what zerohedge would subscribe;
  • the views with regard to the necessity of aircraft carriers are wrong, naive; 
One wonders if the writer of the blog dislikes the US so much, and loves Russia so much, why did the writer move to the US after having his/her life ruined elsewhere?

Let's See ... The Roaring 20's -- What Could Possibly Go Wrong? -- December 27, 2019

All three major indices hit all-time highs yesterday.

FOMO. Headline over at the LA Times today -- "Stocks soared this year. Half of millennials missed out."

Futures, 5:43 a.m. CT:
  • Dow: up 88 points
  • S&P 500: up 8 points (by the way, that's right at the historical ratio, Dow/S&P 500 --- 10 / 1 -- which is incredibly bullish)
  • NASDAQ composite closed at 9,022.39 yesterday.
  • NASDAQ 100 contract closed at 8,804.25 yesterday, right now, real-time, up 33.37 points; link here;
  • On top of everything else that folks have been writing about at the "macro" level or long-term outlook, thinking ahead to January / February:
    • high likelihood of folks looking to take profits; they won't pay taxes for fifteen months (except for quarterly estimates)
    • but, if the bull market emotion is still alive, after taking profits, folks will want to get back in quickly
    • a pullback would give some folks a chance to get into the market
    • "they" say there is still a lot of money on the sidelines (note to newbies: "they" are always saying that; I've heard that line in every bull market for the past forty years)
    • a lot of folks are eager to front-load their retirement accounts in January / February
    • Christmas bills come due in January/February
  • but think about this: starting next year I estimate as much as $1 trillion will have to come out of non-spousal inherited beneficiary IRAs under the new tax rules -- the $1 trillion is a huge wag; I'm waiting for Forbes to give us the number
  • let's see: the government says new money raised on the new taxes coming out of these accounts is about $2 billion / year
    • let's assume, a 20% tax rate. $2 billion is 20% of what? 
    • $2 billion = ? *0.2
    • $100 billion
    • that sounds about right; certainly more realistic than $1 trillion
    • so we will go with that: an additional $100 billion will be coming out of these accounts under the new law; this, of course, does not include the amount that would normally be coming out of all retirement accounts this year
    • a lot of that money will go back into investments (tailwind for the market)
    • a lot of that money will be spent; new money circulating through the economy
  • wow, how did I get this far off track?
  • Let's look at some individual stocks:
    • Dow futures, now up 94 points (6:00 a.m. ET)
    • TSLA: nope, I won't go there
    • AAPL: at $291.49, up 0.54%; up another $1.58
    • AMZN: jumped almost $80 yesterday; up $11 in futures today; can you spell Robinhood?
    • MSFT: up 0.51%
    • BA: after falling about a percent yesterday, up 0.4% in pre-market trading
    • T: up slightly
The roaring 20s: what could possible go wrong?

The 20 best-performing stocks of the decade: zerohedge

Energy Notes From All Over, Part 1 -- December 27, 2019

US light, sweet oil: the darling of the world. Thank you, IMO 2020. Link here.

False precision:

My hunch: 8,000 bbls/month is spilled and unaccounted for every month in the country formerly known as the USSR (CFKATU), now known as Putinstan.

With apologies to: Prince Rogers Nelson, later called the Artist Formerly Known as Prince.

Is the US shale boom really about to end? From Rigzone today -- I sort of read the article, lost interest quickly. It is what it is. Be happy Hillary is not president. She loves to put people out of work. Or Bernie. Or half a dozen others.

Oil near three-month high on signs of shrinking supplies. Maybe rigs matter. LOL.

EIA's weekly petroleum report, I suppose, will be out later this morning. Let's check today's calendar.
  • EIA natural gas report: 10:30 a.m. ET
  • EIA petroleum status report: 11:00 a.m. ET
Jobless claims, reported  yesterday, bless their hearts:
  • prior: 234K
  • prior revised: 235K
  • consensus forecast: 223K
  • actual: 22k
Canadian natural gas pipeline:
  • Coastal GasLink Pipeline: 416 miles of pipeline under construction
  • from Dawson Creek, BC to the LNG Canada liquefaction and export facility being built  in Kitimat, BC
  • capacity: 2.1 billion cubic feet per day
  • TC Energy to sell 65% equity interest in the pipeline to KKR & Co, Inc., and Alberta Investment Management Corporation
  • And then this:
TC Energy said it will give the 20 First Nations (indigenous people in Canada who live along the coast of the pipeline) the option to acquire a 10 percent equity interest in Coastal GasLink. All 20 First Nations have signed project agreements for the pipeline.
Upon transaction completion, TC Energy will hold a 35 percent limited partnership equity interest in Coastal GasLink. The transaction is expected to close in the first half of 2020.
In my dreams I have a plan ... if I got a pipeline ..
Money, Money, Money, ABBA

Twenty-Six Wells Yet To Be Reported This Week -- December 27, 2019

Friday, December 27, 2019: 87 for the month; 292 for the quarter:
36367, conf, Newfield, Hoffmann 150-98-17-20-5HLW, 
35878, conf, Whiting, Domaskin 21-20HU, 
35875, conf, Whiting, Domaskin 34-17TFHU
35744, conf, Whiting, Ogden 41-9TFHU,
35699, conf, Slawson, Mole 6-20TFH
34773, conf, Enerplus, Hidalgo 148-94-11C-2H-TF

Thursday, December 26, 2019: 81 for the month; 286 for the quarter:
36366, conf, Newfield, Hoffman 15-98-17-20-6H, 
34836, conf, Enerplus, Nyx 149-93-33D-28H-TF,
30179, conf, Slawson, Challenger Federal 7-29-32TFH

Wednesday, December 25 2019: 78 for the month; 283 for the quarter:
35782, conf, Hess, EN-Farhart-156-93-0409H-4, 
35698, conf, Slawson, Mole 7-20TFH

Tuesday, December 24, 2019: 76 for the month; 281 for the quarter:
35903, conf, Slawson, Orca Federal 1 SLH,
35570, conf, Whiting, Anderson 11-7-2TFH
35569, conf, Whiting, Anderson 11-2H, 
35120, conf, Oasis, Nordeng 5298 13-25 9T
34837, conf, Enerplus, Homer 149-93-33D-28H-TF,
34774, conf, Enerplus, Ancho 148-94-11C-2H,

Monday, December 23, 2019: 70 for the month; 275 for the quarter:
36524, conf, Slawson, Challenger Federal 9-29-32H, 
36173, conf, XTO, Lavern 42X-14H,
35902, conf, Slawson, Tempest Federal 1 SLH, 

Sunday, December 22, 2019: 67 for the month; 272 for the quarter:
36172, conf, XTO, Lavern 42X-14CXD, 
34838, conf, Enerplus, Hera 149-93-33D-28H,
30178, conf, Slawson, Diamondback 1 SLH, 

Saturday, December 21, 2019: 64 for the month; 269 for the quarter:
36171, conf, XTO, Lavern 42X-14BXC, 
35901, conf, Slawson, Slasher Federal 722-27 MLH, 
34746, conf, Oasis, Nordeng 5298 13-25 8B,