Nine Wells Yet To Report -- June 17, 2020

First things first: retail sales in May surge. Gasoline prices were very, very low.

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AAPL: up $9/yesterday. It appears AAPL will add a bit more at the open; could set yet another all-time high. Target is now $400. I always find it interesting that so often, immediately after the "Fed" meeting the market plunges, and then 24 hours later, all is forgotten and the market moves up again. Last week, again. The "Fed" remains unchanged, but the Dow plummets 1,800 points, but a week later it's all forgotten.

Home sales: housing starts total 974,000 in May vs 1.095 million expected. 

Home sales: mortgage demands spike to 11-year high, as rates hit another record low.

• Mortgage applications to purchase a home rose 4% last week from the previous week and were a remarkable 21% higher than a year ago, according to the Mortgage Bankers Association.
• That was the ninth consecutive week of gains and the highest volume in more than 11 years. 
• The average contract interest rate for 30-year fixed-rate mortgages decreased to 3.30% from 3.38%. 
• $1,408 / month vs $1,375/month on $500,000 first year.

Target: minimum wage raised to $15/hour.

EIA weekly petroleum report: I will likely be off-line most of the day due to family commitments. I may be delayed reporting this. Link here.

Natural gas: US production efficiency continued to improve in 2019. The Haynesville growth is incrdible, especially considering this is a mature field.

OPEC badsket: $35.09. Ouch. OPEC as the number at $36.75. Link here.

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Back to the Bakken

Active rigs:

$37.74	6/17/2020	06/17/2019	06/17/2018	06/17/2017	06/17/2016
Active Rigs	13	62	62	57	28

Nine wells yet to report:

Wednesday, June 17, 2020: 41 for the month; 186 for the quarter, 413 for the year:

• 36234, conf, Whiting, Lidseth 11-1H, 
• 36074, conf, BR, CCU Plymouth 44-29MBH,

Tuesday, June 16, 2020: 39 for the month; 184 for the quarter, 411 for the year:

• 37214, conf, CLR, Burian 3-27H1,
• 36878, conf, Equinor, Domaskin 40-31 4TFH, 
• 36075, conf, BR, CCU Zephyr 14-29TFH,

Monday, June 15, 2020: 36 for the month; 181 for the quarter, 408 for the year:

• 36879, conf, Equinor, Jack Cvancara 19-18 XE 1TFH, Alger,
• 36076, conf, BR, CCU Zephyr 14-29MBH, Corral Creek,

Sunday, June 14, 2020: 34 for the month; 179 for the quarter, 406 for the year:

• None.

Saturday, June 13, 2020: 34 for the month; 179 for the quarter, 406 for the year:

• 37193, conf, CLR, Wiley 14-25HSL, Pershing,
• 35959, conf, Whiting, Arndt 14-5-2XH, Sanish,

RBN Energy: impairment charges trigger E&P losses, while a cash-flow crisis looms.

March’s crude oil price crash hit the E&P sector like a tsunami, shattering capital and operating budgets, upending drilling plans, and eviscerating equity valuations. The initial responses by producers to the price collapse included a flood of capex reductions, corporate belt-tightening, and scattered production shut-ins. But first-quarter earnings reports issued in late April and early May provided the first detailed insight into the financial wreckage the crisis unleashed on U.S. E&Ps.

It wasn’t pretty.

The plunge in the WTI oil price to $20/bbl at the end of the first quarter triggered a combined $60 billion in impairments of oil and gas reserves across the 41 E&Ps we track, as well as a 16% decline in average revenue per barrel of oil equivalent (boe) from the pre-pandemic fourth quarter of 2019. More trouble may be ahead: the average oil price in the second quarter is on track for a 35% decline from the first quarter, which will dramatically impact the cash flows that allow companies to pay their staff, keep the lights on, and hold creditors at bay. Today, we analyze the first-quarter earnings results of our representative sample of U.S. producers and take a look forward to the potential effect of lower pricing on second-quarter earnings.