API crude oil inventory: surprise, surprise, another surprise, LOL.
forecast: a build of under 2 million bbls (1.848 million bbls to be exact, along with that false precision)
actual: 6.407 million bbls
Saudi Arabia: if the photos are real, and the news is real, and Saudi Arabia really has booked several VLCC to carry a gazillion bbls of oil to the United States, it's going to be quite a party here in the US.
First of all, can you imagine all those tankers off-loading on the west coast. The west coast can't possible sop up all that oil. We will have floating tankers out on the Pacific for weeks on end. The price of gasoline should plummet in California. Could we see $1.50-gasoline in San Francisco? LOL. And when does this happen? Right as the driving season begins and hopefully it will continue right through the summer into November, so all those folks can drive to the polls and vote for continued cheap gasoline. This could be a real hoot. But you know, even if we don't see $1.50-gasoline in California, I can't imagine the current $35-WTI clawing its way back to even $45 very soon. This will be fascinating to watch. Maybe $45-WTI is all we can hope for.
********************************* Back to the Bakken
Active rigs:
$34.48
3/10/2020
03/10/2019
03/10/2018
03/10/2017
03/10/2016
Active Rigs
55
67
59
44
33
Two new permits, #37439 - #37440, inclusive:
Operator: Oasis
Field: Sand Creek (McKenzie)
Comments:
Oasis has permits for two Wold wells
one Wold well will be in SWSE 34-153-97;
the other Wold well will be in Lot 3 section 6-152-97
Weather: it's going to hit 80° later this afternoon. It already feels that warm.
Grilling: a long story. To protect the innocent, I can't divulge the details. But yesterday while shopping at one of the more upscale grocers in the area, I was given a 1.5-pound roast for free. No gimmicks; no coupons; simply a gift paid forward. So today I'm going to grill a roast. This is the first time I've grilled a roast. We'll see how it goes.
Stimulus: looks like the president and the GOP are talking about a $300 billion "safety net" package of some sort focused on blue collar workers as they might be affected by coronavirus. It was somewhat hilarious when I listened to the US Senate minority leader, Chuck Schumer. He was clearly against helping the blue collar workers. He was talking like a Republican. He says American CEOs want the coronavirus contained; not a "safety net" for their workers. Pretty amazing.
Never let a crisis go to waste: one almost has to laugh. First they said Trump did not act fast enough or spend enough. It was the US Congress that delayed getting him an "emergency" spending bill for him to sign, and then when they did, way more than he asked for. So, now, he's asking for $300 billion in tax relief to deal with the "fallout" from coronavirus, and the Dems are saying he's spending too much. Well-played.
Babies: in the space of one 7-day week, three new babies in the family. First, our younger daughter and son-in-law are the proud parents of two twins, Judah and Levi, born as scheduled, Tuesday last, at 11:30 a.m. Yesterday, one of my sisters sent the photo of her first grandchild -- a granddaughter born earlier yesterday in Tucson, Arizona. Pretty amazing.
***********************************
Grilling
Because we live in an apartment complex which does not allow grilling on the patios, I have a heavy-duty shopping bag filled with all the grilling "stuff" I need and keep it in the trunk of my car, along with charcoal.
My grilling bag with everything in it that I need:
Prepare and marinate about three hours before grilling:
four parts (I didn't measure, maybe 1/4 cup) vegetable oil
one part balsamic vinegar (do not overdo the balsamic vinegar; err on side of less is best, but don't omit)
one part soy sauce
one-half part Worcestershire sauce
[I would have added a tsp of smoke, but I couldn't find any in the refrigerator]
some garlic powder (if no cloves)
1 tsp pepper
1 tsp salt (I used to not use salt but salt is important for reasons than just flavor)
[another recipe suggested brown sugar so after an hour of marinading, I added a quarter-cut of brown sugar; be careful with the brown sugar; less is probably best; o/w too sweet]
The roast with a wonderful marinade before grilling:
Grilling on indirect heat (of course, the Weber is covered while cooking; cover removed only for the photo). Note that the aluminum foil is left open just a bit at the top:
Post script: wow, it turned out well. I know I'm in the minority on this, but I agree with those who say all one needs is a Weber grill. It is amazing. I've never used a meat thermometer before but this afternoon, grilling a thick roast it was definitely needed. Wow, it turned out moist. It was incredible. I can't believe how effortless it is to grill. Every time I learn something new. Maybe more later. I have to check the NDIC daily report.
Marathon Oil pre-market after announcing an immediate capital spending reduction of at least $500M from its previously planned 2020 capital spending budget of $2.4B.
The revised capex of $1.9B or less represents a ~30% reduction from 2019 levels.
Marathon says it will suspend further resource
play exploration drilling and leasing activity, suspend all operated
drilling and completion activity in Oklahoma, and "meaningfully reduce"
operated drilling and completion activity in the Northern Delaware.
The company says it maintains a strong financial
foundation, ending 2019 with ~$3.9B of liquidity and no near-term debt
maturities.
OXY: cuts dividend from 79 cents to 11 cents. Major CAPEX cut. OXY left the Bakken years ago; if a pure Permian play (from my point of view). From Street Insider:
Occidental Petroleum Corporation
announced today that its Board of Directors approved a reduction in the
company’s quarterly dividend to $0.11 per share from $0.79 per share,
effective July 2020.
The company also announced it will reduce 2020
capital spending to between $3.5 billion and $3.7 billion from $5.2
billion to $5.4 billion and will implement additional operating and
corporate cost reductions. [A 30% cut in CAPEX.]
Einstein's War: How Relativity Triumphed Amid The Vicious Nationalism of World War I, Matthew Stanley, c. 2019. The author is probably a flaming liberal -- and I say that in a good way -- but the book looks good.
The author:
degrees in history, astronomy, physics, and religion
professor of history at NYU's Gallatin School Individualized Study
has published two academic books
has written for Physics Today, Physics World, and the Los Angeles Review of Books (I did not know people read books any more in Los Angeles)
he has appeared in documentaries on the History Channel, BBC, and NPR
He looks like someone with whom I would enjoy spending a weekend in a cabin in Vermont, maybe near Bernie, discussing astronomy.
Regional issue: I don't want to get to far in front of my headlights but if we start to see data that Italy has a handle on this, one starts to get the feeling that even for the United States, it's becoming a "regional" and a state problem with less and less a national problem. Governors are stepping up and making the hard decisions. The Princess Diamond, in hindsight, may have given the experts at the CDC a chance to really, really better understand this virus. [Later, the Italian numbers reported today may be incorrect; apparently the Lombardy region not accurately counted. This makes sense; I had expected a higher number. I was wrong, thinking that things were better than they really were, and I got ahead of my headlights.]
7:38 p.m. March 10, 2020: the Italian numbers reported today may be incorrect; apparently the Lombardy region not accurately counted.
This makes sense; I had expected a higher number. I was wrong, thinking
that things were better than they really were, and I got ahead of my
headlights. If accurate, the Italian numbers tomorrow, March 11, 2020, will be off the chart.
9:24 a.m. March 10, 2020: wow, this thing (coronoavirus) is
already over. I stopped by Schwab this morning to deposit some cash, and
then do some buying. While waiting I was forced to watch/listen to CNBC
but talk about an upbeat feeling. Regardless of the ankle biters, the
big story is that this is over. China is actually talking about getting
back to normal and banning flights from the US. LOL. Right now,
from the Chinese perspective, the US is doing worse than China with
regard to the number of new cases. On top of that, the number of new
cases will skyrocket as more testing kits become available. By country:
Italy: still waiting for today's numbers. Even if Italy has
things under control now, it will take two weeks for the numbers to show
that.
Cruise ships: a reader wrote me this morning to let me know that CBS
had a segment on seven (?) cruise ships off the coast of Florida and
folks were boarding. Speaks volumes. Look at the numbers from the best
case study we have so far, the Diamond Princess:
3,711 passengers and staff
700 test positive
6 deaths; not one death in anyone less than 70 years of age;
it
would be interesting to know how many deaths one sees on an average
cruise ship of 4,000 people, or if the numbers too low for one ship,
over the course of a year; from The [London] Telegraph:
Not
surprisingly, cruise lines are loath to talk about people dying on
their ships, but it happens. There are an estimated 200 passenger deaths
a year – actually remarkably few given the 21.7 million people
worldwide that cruise each year.
Italy: the numbers are out for the day. Best report we've had in several days. See note above.
Break-even costs: Hey, before we get started, can we clear up one
myth regarding break-even prices for Saudi Arabia? One of my pet peeves
is the meme/myth/worldview that Saudi has the cheapest oil in the world,
that they can produce oil for $5 a barrel or some such thing. Not even
close.
According to S&P Global Platts the break-even price for Saudi Arabia is $83 for the Saudis, $51/Brent bbl for the Russians.]But as I've said on the blog many, many times, if the Saudis want to give away their lifeblood at $30/bbl that's their choice. Americans are lovin' it. The Chinese will love it when they get back to normal.
Trump: by the way, do y'all remember those days when President Trump said oil prices were too high and he wanted to see oil prices to come down. Wow, love him or hate him, this guy gets things done. The previous president said multiple times, "it" couldn't be done. Of course, the previous president also said Bloomberg "didn't build that." Wow, what a digression. Sorry for the politics. Twitter link:
Speaking of which, how is that Saudi Aramco IPO working out? MBS: welcome to the world of geo-politics.
***********************************
Back to the Bakken
Active rigs:
$34.18
3/10/2020
03/10/2019
03/10/2018
03/10/2017
03/10/2016
Active Rigs
54
67
59
44
33
Two wells coming off the confidential list today: again, these are going to be spectacular wells.
Again, "who will show the most resilience, the Bakken or the Permian?" The one thing I did not consider/mention in that linked commentary: time frame. There has to be a time frame. The Permian will last decades longer than the Bakken, but that's not the question being asked. I'm asking about the current situation as it pertains to the "Market Meltdown - 2020." My time frame is the next six months, or if the price war goes on longer than this, then one year, max. And even a year out is way too long, but ...
No cherry picking, just reporting them as they come off the confidential list which I've been doing since 2009. Wow, that's a long time.
Tuesday, March 10, 2020: 20 for the month; 191 for the quarter, 191 for the year:
Canada has been facing a similar situation to the U.S. in recent
years in which the production of natural gas liquids, such as propane,
has been rising sharply thanks to a focus on liquids-rich gas wells in
unconventional gas plays. In response to the rising bounty of propane,
infrastructure development in Canada has focused on export projects, and
in 2019, the completion of the new Ridley Island Propane Export
Terminal in British Columbia enabled the first overseas exports of
propane from Canada’s west coast, allowing Western Canadian producers to
access destination markets beyond just the U.S. for the first time.
Later this year, Pembina Pipelines, a developer of energy infrastructure
projects across Western Canada, will complete a new propane export
terminal just outside Prince Rupert, BC, further boosting propane
exports to overseas markets. Today, we take a closer look at propane
supply issues, Pembina’s new propane export terminal and recently
announced plans to further expand the terminal’s export capacity.
The shift to more unconventional oil and natural gas plays in North
America over the past decade has generated significant production
increases in all forms of hydrocarbons. Crude oil, natural gas and
natural gas liquids (NGLs), which includes propane, have all been
hitting record or near-record levels in both the U.S. and Canada. This
has forced markets in both countries to find more outlets for their
growing output, both domestically and overseas.
34857, A, Uhlman Federal 8-7H, 33-053-08516, Banks, 73K in one month; fracked 7/9/19 - 7/22/19; 9 million gallons of water; 86.7% water by mass; friction reduction, 0.06;
Pool
Date
Days
BBLS Oil
Runs
BBLS Water
MCF Prod
MCF Sold
Vent/Flare
BAKKEN
1-2020
31
73759
73619
39958
94992
93002
1841
BAKKEN
12-2019
2
3635
3544
1856
4349
4270
16
BAKKEN
11-2019
0
0
0
0
0
0
0
BAKKEN
10-2019
0
0
0
0
0
0
0
BAKKEN
9-2019
4
704
704
1773
1283
0
1283
Can we get an "amen"? LOL.
34851, SI/NC, CLR, Pittsburg 8-18H, 33-053-08510Banks, t--; cum --; fracked 6/3/19 - 6/21/19; 11.1 million gallons of water; 88.7% water by mass; friction reduction, 0.059;
Pool
Date
Days
BBLS Oil
Runs
BBLS Water
MCF Prod
MCF Sold
Vent/Flare
BAKKEN
1-2020
31
50978
50861
42246
68632
67193
1331
BAKKEN
12-2019
2
1715
1672
1530
2309
2266
9
BAKKEN
11-2019
0
0
0
0
0
0
0
BAKKEN
10-2019
0
0
0
0
0
0
0
BAKKEN
9-2019
5
964
964
3617
1328
0
1328
Another Bakken DUC produces more crude oil in one month than the average new Permian well. See the EIA dashboards. Can we get another "amen"?
Break-even point: I saw it earlier this morning; looking for the link now, but confirms what I said yesterday -- Saudi Arabia's break-even price is $83. I assume that's "their" price which pretty much reflects Brent. Saudi is in a fight for its very survival, but like the US, Saudi doesn't have a revenue problem, it has a spending problem. [Later, here it is, I found it ... wow, what a memory ... yes, according to S&P Global Platts the break-even price for Saudi Arabia is $83 for the Saudis, $51/Brent bbl for the Russians.]
***************************************
The Article To Read Today
This article might take you 45 seconds to read. Re-posting:
one can immediately tell what she recorded in Muscle Shoals;
there are moments when the Muscle Shoals sound almost pushes one into country music
or maybe some country singers were influenced more by the Muscle Shoals sound than they let on
I can never forget the reader who introduced me to Muscle Shoals; thank you so much; I hope you are still reading the blog -- not because I think you need to read the blog, but because I want to know that you are still alive, kicking, and enjoying music
whatever happened to Joss Stone (my brother, Craig, introduced met to Joss Stone)
1:47 p.m. March 10, 2020: the Italy numbers are out. Best report we've had in days. A snapshot in time doesn't mean a whole lot but if a) this number is accurate; and, b) the trend continues, it speaks volumes about the infectious disease process of coronavirus. Remember: the northern region of Italy was severely quarantined about two days ago; the entire country was put in lockdown yesterday.
10:18 a.m. March 10, 2020: what a difference the mindset can make. Here, we have a crisis, the coronavirus crisis. Imagine how a politician, let's say President Obama, would address it. Then imagine, a business, let's say President Trump, how he would address it.
Both:
stress calm
Not both:
one would confidence, perhaps even bullishness sooner than later; look for opportunities; take reasonable precautions; propose sweeping tax changes to help the blue collar workers
the other would exude "woe is us"; we deserve this; we need to hunker down; circle the wagons; take outlandish precautions; wear cardigan gloves;
I am simply blown away how President Trump reacts to this. Some months ago he started talking about another tax cut; most pundits said that talk was DOA; at best, it was premature, by a year or so. But now, a crisis. Connect these two dots.
Trump is talking about raising the minimum wage
Trump invites business CEOs to the White House, immediately
Can you connect the dots? What question(s) do you think Trump will be asking the CEOs. He won't be telling them what to do; he's asking them what the consequences of certain actions might be.
In addition to seriously considering raising the minimum wage, he is seriously considering cutting the payroll tax. I've talked about that before. If there is one tax that is incredibly regressive and harmful to the average blue collar worker it is the "payroll tax" -- withholding, social security, Medicare, union dues, miscellaneous state and local taxes.
Most agree that a Democrat president proposing that to a GOP congress -- 50/50 chance of success at best. But a GOP president proposing that --wow, it would be very, very hard for a congresswoman representing blue-collar Brooklyn, for example, to vote against helping out her constituents, especially when said congresswoman is up for re-election. It's only March. Let's look at the calendar.
DNC convention, late July. GOP convention, late August.
March: float some balloons
April: staffers work with congressmen/women
May: submit the proposal to the US House
June: US House votes yea/nay;
July: US Senate considers it if it passes the House
September/October: two full months before the election
coronavirus? history by September/October
by the way, everyone suggested Trump would miss his GDP targets this year; now, someone/something to blame. LOL
I'm way beyond my headlights here, but I got going and couldn't quit.
9:24 a.m. March 10, 2020: wow, this thing (coronoavirus) is already over. I stopped by Schwab this morning to deposit some cash, and then do some buying. While waiting I was forced to watch/listen to CNBC but talk about an upbeat feeling. Regardless of the ankle biters, the big story is that this is over. China is actually talking about getting back to normal and banning flights from the US. LOL. Right now, from the Chinese perspective, the US is doing worse than China with regard to the number of new cases. On top of that, the number of new cases will skyrocket as more testing kits become available. By country:
Italy: still waiting for today's numbers. Even if Italy has things under control now, it will take two weeks for the numbers to show that.
Cruise ships: a reader wrote me this morning to let me know that CBS had a segment on seven (?) cruise ships off the coast of Florida and folks were boarding. Speaks volumes. Look at the numbers from the best case study we have so far, the Diamond Princess:
3,711 passengers and staff
700 test positive
6 deaths; not one death in anyone less than 70 years of age;
it would be interesting to know how many deaths one sees on an average cruise ship of 4,000 people, or if the numbers too low for one ship, over the course of a year; from The [London] Telegraph:
Not surprisingly, cruise lines are loath to talk about people dying on their ships, but it happens. There are an estimated 200 passenger deaths a year – actually remarkably few given the 21.7 million people worldwide that cruise each year.
Original Post
After Bill comes out with his confession (LOL): Hillary attempts to one-up him. From The Babylon Bee:
Here's the thing ..... LOL. That is absolutely the new catch line -- I hear it everywhere ... Geico to Cherry Vanilla Coke -- Pocahontas will fade away but "here's the thing" will live on forever. Well, maybe not forever, but longer than she did. LOL.
Wow, I'm in a good mood. Cash position build in last few days due to dividends. Off to Schwab this a.m. to continue to build positions in non-energy companies.
First things first: Starbucks -- a love-hate relationship. For about the last year or so I've been going to Starbucks almost every day, sometimes twice a day, to blog. But then about a month ago, I quit Starbucks completely. I have gone back twice in the past month, both times on the weekend. Haven't been there once during the week in the past month or so. Instead, it's McDonald's. I'm lovin' it. There are days that I prefer the ambience of Starbucks but McDonald's is a much, much better place to actually get work done.
Then I saw this yesterday: Starbucks learns the cost of virtue-signaling. Bottom line: Starbucks inside-restaurant foot traffic has dropped since they announced their no-hassle policy for freeloaders.
In May 2018, in response to protests, Starbucks changed its policies
nationwide to allow anybody to sit in their stores and use the bathroom
without making a purchase. Using a large panel of anonymized cellphone
location data, we estimate that the policy led to a 7.3% decline
in store attendance at Starbucks locations relative to other nearby
coffee shops and restaurants. This decline cannot be calculated from Starbucks’ public disclosures, which lack the comparison group of other coffee shops. The decline in visits is around 84% larger for stores located near homeless shelters. The policy also affected the intensive margin of demand: remaining customers spent 4.1% less time in Starbucks relative to nearby coffee shops after the policy enactment. Wealthier customers reduced their visits more, but black and white customers were equally deterred.
The policy led to fewer citations for public urination near Starbucks
locations, but had no effect on other similar public order crimes. These
results show the difficulties of companies attempting to provide public
goods, as potential customers are crowded out by non-paying members of
the public.
Wow, that hit home. I go to an upscale Starbucks. We don't have a homeless situation in this area, at least to any great visible extent. But for the last six months before I left Starbucks, there was a young homeless man that occupied my favorite chair day in and day out. I did not mind so much but the body odor was overwhelming. When he walked in, I generally left. If he was already there when he arrived, I left before ordering anything. I had forgotten all about that. Then this Sunday past, at Starbucks, a different young man, sat down in the chair next to me. He did not look like a typical Starbucks (paying-) customer; he immediately took out his iPhone and started texting "to beat the band," as they say. I was absolutely surprised when he got up to order something. I thought he was another freeloader. For a minute there, I thought I had misread him. He came back with his free cup of ice water. Yup, just as I suspected. I can only imagine how big this has gotten in some areas of the country.
It's definitely the right policy; I have no problem with the policy, but it does have a cost. I would argue that Starbucks can afford the cost, but it is a gut check for Christians. There is a difference in my mind between loitering and being homeless.
Bernie: is done. Turning point: doubling down, tripling down on his support for Cuba's Fidel Castro was the turning point. The only question is how he will "drop out." On top of everything else, the unions don't want to lose their health insurance which Bernie has said will happen.
Schumer: avocado toast. And he's not even from California.
Coronavirus: Italy is out of control, but the most recent data suggests ... "if one ignores the numbers coming out of Italy, this thing is over." Having said that, it won't be over in Italy for at least two more weeks. Again, the numbers coming out in the EU (and in many other places in the world) can be traced back to Italy. This is absolutely fascinating -- the coronavirus story. On so many levels. We'll post the numbers later.
Government stimulus: wow.
Texas, #1: number one in the commercial building, jobs. Talk radio talk. I will try to find the link. Beats out both California and New York. I think this was for the entire year:
$1.41 trillion added to the US GDP in one year; US 9.2 million American jobs supported;
I see this everywhere driving around Texas, from north Texas (DFW) to San Antonio
Disclaimer:
this is not an investment site. Do not make any investment, financial,
job, career, travel, or relationship decisions based on what you read
here or think you may have read here.
OXY: wow, there is so much going on, I can't keep up.
*************************
Alexa
I continue to enjoy Alexa. At night, when I jump into bed, get out my iPads (yes, plural), put the iPhone on the little desk next to the bed, and arrange all the remote controls (radio, television), etc., I then lay back and talk to Alexa. Once in awhile I might ask a question, or ask her to "play" Fox News but 99% of the time, it's all about the music. The only challenge is trying to figure out what might interest me. I try very, very hard to find "new" stuff.
Last night: Etta James. Wow, I never new her catalogue was so incredible. Her life story (wiki) is .... well, let's just say there are a lot of similarities between Etta James and Amy Winehouse. But she more than redeems herself with her music. And, again, wow, what a catalogue.
Sometimes Alexa will throw in a song that is not being sung by the singer one has requested. While listening to Etta James last night there was a song that I swear was sung by Janis Joplin but a google search suggests Joplin never sang this particular song, but YouTube has multiple music videos of Etta singing this song. It was enlightening to do a google search with Etta James Janis Joplin. I think I kept some of those links. I will post them later.
**************************
Guess The Name Of The Pianist
On another note, no pun intended,
At 1:20 in this video, does anyone recognize the pianist? Somehow he looks very, very familiar. The comments to this video do, indeed, provide the answer.
I was wondering whether it might only be me that could not name the pianist -- he looked very familiar. I sent this to my wife: she knows everything and she really knows everything about old movies. She was stumped. She thought the pianist had some of the features of an early Sid Caesar.
Rhapsody in Blue, George George Gershwin
Rhapsody in Blue entered the public domain on January 1, 2020, although individual recordings of it may remain under copyright.
