No Wells Coming Off Confidential List; Number Of Active Rigs Unchanged; Fracking Can't Keep Up -- July 21, 2021

OPEC basket: link here.

OPEC+ deal: I'm glad I'm not the only one who can't figure it. Devil is in the details -- ArgusMedia. 

Ethanol: US senators on both sides introduce bill to remove ethanol mandate -- ArgusMedia. I have no idea what this is all about.

Natural gas: the unreported story.
shorting this natural gas market has clearly not worked; exports keep fundamentals tight; link here;
natural gas price: link here. Spikes to $4.00.

Ten-year treasury: 1.238%. Link here.

China: the swing consumer. China buys less Saudi crude oil as it slams the brakes on oil imports. Link to Tsvetana Parskova. Wow, we've been talking about this for quite some time. 

US oil demand: to pre-Covid levels in less than nine months. Link to Irina Slav. 

Coal is dead! Long live coal: Asian benchmark coal spikes to a fresh 13-year high. For a commodity left for dead, Australia and other coal miners are making a killing this year. Link here. 

Oh-oh: global EV battery industry will be "sold out" by 2025 -- only four years from now. Link here. That's the least of "their" problems.

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Back to the Bakken

Fracking: North Dakota's oil output is "flat as a pancake" due to lack of frack crews. Link here. 

Rig count: biggest reason active rig count not going up -- what's the use. Fracking can't keep up with the few rigs "we" already have.

Director's Cut: posted yesterday; North Dakota crude oil production up slightly month/month.

Active rigs:

$68.46	7/21/2021	07/21/2020	07/21/2019	07/21/2018	07/21/2017
Active Rigs	23	11	55	67	59

No wells coming off confidential list.

RBN Energy: the outlook for the Appalachian natural gas market. 

It’s been a while since the Appalachian natural gas market has looked this bullish. Outright cash prices at the Eastern Gas South hub are at multi-year highs. Regional storage inventories are sitting low, setting the stage for supply shortages and still higher prices this winter. But the potential for severe takeaway constraints and basis meltdowns are lurking, and by next year, they could become regular features of the market again like they were in the 2016-17 timeframe, or worse — at least in the spring and fall when Northeast demand is lowest. 

Regional gas production is still being affected by maintenance and has been somewhat volatile lately as a result, but it averaged 34.5 Bcf/d in June, just 300 MMcf/d shy of the December 2020 record. 

What’s more, at current forward curve prices, supply output could surpass previous highs by next spring and grow by ~ 5 Bcf/d (15%) by 2023. Outbound flows set their own record highs this spring, running at over 90% of takeaway capacity, and will head higher, which means that spare exit capacity for supply needing to leave the region is shrinking. 

The handful of planned takeaway expansions that remain are facing environmental pushback and permitting delays, and the few that are targeting completion in the next year may not be enough.