Notes From All Over -- The Early Saturday Morning Edition -- March 13, 2021

We start with a great comment from a reader, posted elsewhere:

1. 17 frac spread jump is huge.

https://twitter.com/MOAR_Drilling/status/1370525944511926275

2. Still need more spreads though. We are up to 187 spreads. I estimate we need something like 200-225 spreads to hold steady at 11.X MM bopd. Mark at C6 says somewhere in the 200-230 is needed. But in any case, we are getting close to a stabilizing number of spreads.

3. Realize this is total frack spreads and does include a small amount in the gas basins. (But a small fraction of oil wells are not fracked, so it evens out.)

4. Right now, we are still drilling DUCs. But you can't burn the furniture forever. We need about 400-450 oil rigs, along with 100 gas rigs, to "hold serve". Right now, we are at 310 oil rigs and 90 gas rigs. Gas is pretty close to right number. Oil still needs to add rigs.

We need 400-450 oil rigs

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Fast and Furious

Portland:

• 20 homicides so far this year, compared to just one at this same point last year;
• U-Haul has run out of 20-foot trucks; unable to guarantee that reserved trucks will be available

Kalispell, MT:

• has such an over-supply of 20-foot trucks that U-Haul will discount rentals if trucks are rented for one-way moves

Brent:

• where would it be without WTI; something fishy going on. Bloomberg reports.
• Platts to add US WTI crude to dated Brent benchmark; previously reported; February 22, 2021;
• apparently that "decision" has been delayed by Platts -- Bloomberg: March 13, 2021
• US oil (WTI) to join North Sea crude price basket, previously reported; February 22, 2021 -- FT;
• same story, Bloomberg, December 3, 2020;
• noted at twitter -- how a hasty move to change the world's key oil price unraveled, March 13, 2021 -- Bloomberg;

Venezuela:

• suspends gasoline production
• due to more equipment breakdowns at the PdV refinery; link here, and here;

Italy:

• heads back to lockdown;
• surge in Covid-19;
• Biden refuses to share desperately needed vaccine with EU allies;
• Germany: trying to re-open, struggles;

Apple:

• don't bet against the Fed;
• don't bet against Tim Cook;
• next generation Apple Silicon MacBooks expected to drive record-breaking shipments this year -- MacRumors, March 12, 2021;
• for the archives; this is not a recommendation one way or the other; simply fascinating to watch Apple logistics
  

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.

Speaking of logistics:

• Qualcomm struggling to keep up with processor demand, MacRumors, March 12, 2021;
  

Samsung:

• processor shortage could impact Samsung, same link as above;

COP:

• resumes buyback program at $1.5 billion annualized level: link here;
• had been suspended following its Concho transaction;
  
• among other "presumed" advantages of buybacks, buybacks save a company huge amount in dividends
• in this case:
• COP: $60/share
• $1.5 billion / $60 = 25,000,000 shares
• annualized, pays $1.72 / share
• $1.72 x 25,000,000 = $43 million; trivial in the big scheme of things, I suppose; I don't know
• company says it aims to return greater than 30% of its cash from operations to shareholders annually;
• funds from operations; link here; 
• let's say $10 billion, this year
• outstanding shares: 1.078 billion shares
• $3.3 billion / 1.078 billion = $3.06 / share
• compare
  

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.

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Samsung -- Qualcomm

Link above.

There's no indication that Qualcomm's supply troubles will impact Apple, but smartphone manufacturers like Samsung could be in trouble. Apple develops its own A-series chips that are manufactured by TSMC, but it does use Qualcomm's modem chips.

Samsung and other Android manufacturers rely on Qualcomm's Snapdragon chips to power their smartphones, and demand has soared over the course of the past few months. Qualcomm is facing shortages of some of the subcomponents used in its chips, and the component issues could impact production of mid and low-end Samsung models.

A source told Reuters that Qualcomm's flagship Snapdragon 888 chip is impacted, but it's not clear if this is impacting the manufacturing of Samsung's high-end smartphones.

I think this is a huge story: Tim Cook's decision to go-it-alone.  This is another great example of Apple's culture carried over from Steve Jobs.