Later: see comments.
For the record, I'm 1000% in XOM's camp.
From today to 2030, it's only seven years, and XOM has demand only going from 100 to 105; in the big scheme of things, practically flat. Meanwhile, even if BP is correct about demand being flat through 2030 (which is very, very unlikely) that descent is quite remarkable.
VLO: rasies quarterly dividend from 98 cents to $1.02 / share.
WMB: raises quarterly dividend to 44.75 cents/share.
************************
Back to the Bakken
Active rigs: 46.
WTI: $78.87.
Natural gas: $2.684.
Four new permits, #39616 - #39619, inclusive:
Four permits renewed:
Eight permits canceled:
Two producing wells (DUCs) reported as completed:
38626:
| Pool | Date | Days | BBLS Oil | Runs | BBLS Water | MCF Prod | MCF Sold | Vent/Flare |
|---|---|---|---|---|---|---|---|---|
| BAKKEN | 12-2022 | 31 | 10567 | 10368 | 13820 | 8058 | 7398 | 660 |
| BAKKEN | 11-2022 | 11 | 4297 | 4512 | 13165 | 3451 | 3372 | 79 |
| BAKKEN | 10-2022 | 28 | 12568 | 12187 | 12196 | 8154 | 8080 | 74 |
| BAKKEN | 9-2022 | 29 | 0 | 0 | 10258 | 0 | 0 | 0 |
I'm being flip, I know --- "... if we're in a recession, give me more ...." I know I may be singing a different tune three months from now, but one starts to wonder. Are the folks who are worried about a recession underestimating what might happen after "coming out of Covid-induced coma" which might, in fact, be followed by the end of a war in Ukraine? I don't know but the energy story is incredibly fascinating.
Now, if we could just get the egg situation in hand.
HP: link here.
Lotus: to go public.
*******************************
After-Hours Earnings
AMD: beats, 69 cents vs 67 cents. Shares surge, up $6/share. Link here.
On average, analysts polled by FactSet expected the medical devices company to earn 61 cents per share on $1.33 billion in sales.
In the year-earlier period Edwards earnings were 51 cents per share and the company reported $1.33 billion in sales.
For the year, Edwards Lifesciences predicted to 9%-12% sales growth, excluding the impact of exchange rates. EW stock analysts forecasted earnings of $2.49 a share and $5.79 billion in sales.
Reported earlier today:
Tuesday, January 31, 2023, dividend calendar (to include time of release), whisper number vs consensus:
The NDIC hearing dockets are tracked here.
The usual disclaimer applies. As usual this is done very quickly and using shorthand for my benefit. There will be factual and typographical errors on this page. Do not quote me on any of this. It's for my personal use to help me better understand the Bakken. Do not read it. If you do happen to read it, do not make any investment, financial, job, relationship, or travel plans based on anything you read here or think you may have read here. If this stuff is important to you, and I doubt that it is, but if it is, go to the source.
These are cases, not permits.
It's all about choosing the right horse, and again, the US is about to choose the right horse. Link here.
A must-read article from Simon Watkins: here's why Qatar is about to make a big move on Iraqi oil and gas.
Qatar’s move to buy a 30 percent stake in four US$27 billion projects in Iraq that were set to be managed entirely by France’s TotalEnergies are in line with the U.S.’s new strategy for Baghdad.
The four projects are essential to Iraq’s future as a truly independent country.
In the middle of the night. Maybe we'll finally find what we're looking for ... in the middle of the night. Wow, it never quits. "The Expectations Index is below 80 which often signals a recession within the next year."
"Within the next year." Say what. They started talking about the coming recession back in early 2022.
And, maybe even before that.
From today's social media:
This is really, really cool.
From January 30, 2023, Michael Fitzsimmons. He inadvertently waded into the decades-old argument -- dividends vs buybacks vs capital gains ... Warren Buffett vs the "typical" mom-and-pop retail investor:
So, for all those folks complaining about CVX's new dividend -- oh, give me a break. CVX threaded the needle about as well as they could:
Nothing required CVX to actually buyback anything.... $75 billion to be used at their discretion.
It really gets back to a short-term horizon vs a long-term horizon.
I'm lovin' it.
*******************
And So Is The US Market
*********************
Area Under The Curve
Update
January 31, 2023: one "word" -- AMEX.
Original Post
Re-posting from November 20, 2022:
By the way, this is where folks are really hurt by having a poor general education, particularly in math. Folks will look (briefly) at the graph below and note only the "curve" or the solid dark line. Much more important is the "calculus" -- it's the "area under the curve" that should catch your attention.
The "area under the curve." Calculus. Start here.
My reply:
Get a grip. For an investor, it's an open-book test: Mastercard, Visa, Discover, and AMEX. Not only lots of credit card activity but lots of late payments and interest rates rising. They're gonna make out like bandits.
And, oh, by the way, savings rates are at 10-year lows, not all time lows. Went much lower in the mid 2000s.
The area under the curve:
My favorite chart which correlates exactly with the chart above.
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. SNAP beats estimates. Fourteen cents vs eleven cents estimate.
Starbucks: reports later this week. Least expensive coffee at Starbucks? $2.85 (or thereabouts -- I was just there two days ago). At home, K-Cup, at Amazon, as low as 27 cents. Starbucks -- 10x K-Cup.
McDonald's: link here. Reminder: a $10 McDonald's meal costs about $2.50 when homemade. A pancake breakfast at home has even bigger savings.
GM: before market open; $1.74 vs $1.68; beats, shares up. $1.39. Shares surge on news. Link here. Link here.
Earlier this morning:
12:14 p.m. CST: Pemex issues bond (singular) worth at least $1.5 billion to refinance debt -- sources.
a ten-year bond
Still looks technically bankrupt to me.
Earlier today:
Coal: Europe. He is not telling the whole story. Conveniently avoids the issue of deindustrialization and complete disruption of energy flow this past year. Another solar nut.
Now, this, from Tyler Durden:
By the way, the Biden administration killed "globalization" when the president signed the MAGA bill, the "inflation reduction act."
From the link: As proof look no further than a study published Monday by Allianz Trade which cited contract expiries and delayed wholesale pricing effects, and which according to Reuters found that German industry is set to pay about 40% more for energy in 2023 than in 2021, before the energy crisis triggered by Russia's invasion of Ukraine.
"The large energy-price shock still lies ahead for European corporates," said Allianz Trade.
As a reminder, in 2022, higher corporate utility bills were contained as long pass-through times from wholesale markets and government interventions mitigated the immediate hit from surging prices as Russia curbed fuel exports to the West. The resulting budget deficits were promptly funded by the ECB, which meant that for all the posturing, Christine Lagarde was directly funding Putin's cash build up.
But the pass-throughs are ending, which means that price increases will soon hit corporate profits across Europe by 1-1.5% and lead to lower investment, which in Germany's case would amount to 25 billion euros ($27 billion).
The silver lining is that German companies' finances are robust, while a state-imposed gas price cap would help (unless it makes things much worse).
At the same time, fears the crisis could lead to de-industrialisation and a loss of competitiveness against the United States were overdone, because labor costs and exchange rates have a bigger impact on manufacturing than energy prices.
Also, while exporters were losing market shares in areas such as agrifood, machinery, electrical equipment, metals and transport, the relative beneficiaries tended to be Asian, Middle Eastern and African, not American.Much more at the link.
The RBN Energy article is "available" for the next few days at the link below.
RBN Energy: bearish 2023 gas market punctuates last throes of shale era abundance. Archived.
The Lower 48 natural gas market has had the most bearish start to a new year in a long time. Production has been at record highs, an exceptionally warm start to January suppressed demand, and LNG exports have been hobbled since last June when Freeport LNG went offline.
The CME/NYMEX Henry Hub February gas futures contract slid to an 18-month low of $2.94/MMBtu last Thursday and expired Friday at $3.109/MMBtu, down 54% from where the prompt contract closed just two months earlier. The March contract extended the slide Monday to a 20-month low of $2.677/MMBtu. Freeport’s eventual return will restore existing export capacity, but there’s no new LNG export capacity due online this year — for the first time since 2016. After one of the tightest gas markets of the last decade in 2022, the stage is set for one of the most oversupplied markets we’ve seen in years.
But the bulls out there can take solace: 2023 will also mark the final throes of the kind of oversupply conditions that defined the Shale Era as we know it. In today’s RBN blog, we discuss how we got here and RBN’s outlook for natural gas supply and demand.
After a great re-cap of 2022 - 2023 -- and it's only January, 2023 -- RBN Energy concludes with this:
That’s 2023. Earlier we promised the bulls among you some good news, however, and here it is:
While 2023 is set up to be overwhelmingly bearish, it’s likely to be the last of its kind for some time to come.
After a slowdown in 2022-23, LNG export capacity additions will come fast and furious over the next several years.
As they do, they will outpace production growth, which will increasingly depend on pipeline expansions.
In other words, 2023 will be the last aftershock of Shale Era surpluses, as the Lower 48 gas market counts down to the next phase: a period of gas shortage and increased volatility, driven by export growth and piecemeal production growth that will be paced by the timing of midstream development.
We got a taste of what that will look like in 2022, but how out-of-whack could the market get? We’ll be back with a more detailed look at our five-year outlook in the next episode of this series.
The Far Side: link here.
Active rig: 46.
WTI: $78.60.
Natural gas: $2.676.
Wednesday, February 1, 2023: 1 for the month; 71 for the quarter, 71 for the year
39075, conf, Crescent Point Energy, CPEUSC Szarka 3-36-25-159N-100W-MBH,
Tuesday, January 31, 2023: 70 for the month; 70 for the quarter, 70 for the year
39043, conf, CLR, Kelling 3-4H,
RBN Energy: bearish 2023 gas market punctuates last throes of shale era abundance. Archived.
The Lower 48 natural gas market has had the most bearish start to a new year in a long time. Production has been at record highs, an exceptionally warm start to January suppressed demand, and LNG exports have been hobbled since last June when Freeport LNG went offline.
The CME/NYMEX Henry Hub February gas futures contract slid to an 18-month low of $2.94/MMBtu last Thursday and expired Friday at $3.109/MMBtu, down 54% from where the prompt contract closed just two months earlier. The March contract extended the slide Monday to a 20-month low of $2.677/MMBtu. Freeport’s eventual return will restore existing export capacity, but there’s no new LNG export capacity due online this year — for the first time since 2016. After one of the tightest gas markets of the last decade in 2022, the stage is set for one of the most oversupplied markets we’ve seen in years.
But the bulls out there can take solace: 2023 will also mark the final throes of the kind of oversupply conditions that defined the Shale Era as we know it. In today’s RBN blog, we discuss how we got here and RBN’s outlook for natural gas supply and demand.
After a great re-cap of 2022 - 2023 -- and it's only January, 2023 -- RBN Energy concludes with this:
That’s 2023. Earlier we promised the bulls among you some good news, however, and here it is:
While 2023 is set up to be overwhelmingly bearish, it’s likely to be the last of its kind for some time to come.
After a slowdown in 2022-23, LNG export capacity additions will come fast and furious over the next several years.
As they do, they will outpace production growth, which will increasingly depend on pipeline expansions.
In other words, 2023 will be the last aftershock of Shale Era surpluses, as the Lower 48 gas market counts down to the next phase: a period of gas shortage and increased volatility, driven by export growth and piecemeal production growth that will be paced by the timing of midstream development.
We got a taste of what that will look like in 2022, but how out-of-whack could the market get? We’ll be back with a more detailed look at our five-year outlook in the next episode of this series.
This is accurate: I’m still in bed. No school today. Link here.
Again, the Dakotas. Link here.
New Mexico: out-producing Mexico. PEMEX to refinance debt; technically insolvent. Owes $105 billion; $10 billion due now. The check is in the mail.
Presidential Hummer: hypocrisy. Doesn’t bother me. Bad optics for the “struggling consumer.” What a doofus.
Coal: Europe. He is not telling the whole story. Conveniently avoids the issue of deindustrialization and complete disruption of energy flow this past year. Another solar nut. And, more here.
EU: outpaced US, China in 2022. Say what?
US natural gas consumption hits all-time record: link here.
Belgium: link here.
Yup. MAGA. Link here.
Norway: go woke, go broke.
Fun fact: link here.
