Six New Permits; WPX With Four More MHA FBIR Permits; Four DUCs Reported As Completed -- July 31, 2024

Locator: 48283B.

Updates

Oh, never mind. There's an election this year. 

Original Post

In the news today:

Weekly EIA petroleum report, link here:

• oil in commercial storage: 4% below historical norm;
• refiners: 90.1%;
• airlines: 1.2%.

Gasoline demand, link here:

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Back to the Bakken

WTI: $77.91.

Active rigs: 40.

Six new permits, #40983 - #40988, inclusive:

• Operators: WPX (4); MRO, BR
• Fields: Heart Buttte (Dunn County); Wolf Bay (Dunn); Lone Butt (Dunn)
• Comments
• WPX has permits for four MHA FBIR wells NENW 18-149-91;
• to be sited between 1190 FNL and 1236 FNL and between 1993 FWL and 1916 FWL
• MRO has a permit for a Smith USA well, NENW 16-146-92, 
• to be sited 966 FNL and 2480 FWL;
• BR has a permit for a Tilton well, SENW 18-147-97, 
• to be sited 2242 FNL and 2494 FWL

Four producing wells (DUCs) reported as completed:

• 40111, 1,770, CLR, Lundberg Federal 5-8H1,
• 40243, 3,128, MRO, KGC 31-6H,
• 40278, 756, CLR, Cuskelly 5-7H,
• 40279, 647, CLR, Thorvald 5-6H,

QCOM Earnings And Ticker --July 31, 2024

Locator: 48282INVESTING.

Markets about an half-an-hour after the close: 

QCOM:

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BRK-B

On a day the entire surged:

Live: Katie Ledecky -- 1500-Meter Freestyle Final -- New Olympic Record -- July 31, 2024

Locator: 48281LEDECKY.

Tag: swimming, Katie.

NBC.

At 200 meters: up 3.4 meters.

At 400 meters: up  5.5 meters.

At 600 meters: up 7.0 meters; about 5 seconds.

At 800 meters: up 8.0 meters; about 6 seconds.

At 1,000 meters: up 10.0 meters; about 8 seconds.

At 1,200 meters: up 11.6 meters; about 9 seconds.

At 1,400 meters: up 14.3 meters; about 11.5 seconds.

At 1,500 meters: up 14.3 meters; about 12 seconds.

New Olympic record. 

Now, more Olympic medals than anyone in history.

Market Surges / Surges -- Fed Maintains Rate -- July 31, 2024

Locator: 48278INV.

Goldilocks economy:

• full employment;
• inflation less than 2% in many cases; exceptions -- housing; 
• in fact, in some areas, risk of deflation
• favors the consumer
  
• spouses happy with high-interest-bearing money market funds;
• investors happy with the market -- really happy today;
• lending rates are not unusual rates based on historical data.

Fed rate unchanged. In line with expectations.

• long, long explanation in Q&A period following prepared remarks which were very short;
• explanation in a nutshell:
  

"The US is experiencing a 'Goldilocks economy.' Anything the Fed does could disrupt this finely balanced machine running well on all eight cylinders. We -- the Fed members -- have nothing to lose by making no change, and everything to lose if we do. A rate change of 25 basis points would have no material effect on the economy but would push the market into even frothier territory."

• having said that, JPow's remarks practically confirmed a rate cut in September unless something "negative" happens that even a caveman could see.

Market following announcement:

Hess: 2Q24 earnings -- Alex Kimani over at oilprice --

Hess Corp. has posted an impressive second-quarter earnings report with its stake in prolific Guyana helping it exceed estimates. Hess reported Q2 2024 non-GAAP EPS of $2.62, beating the Wall Street consensus by $0.07 while revenue of $3.26B was good for a robust 40.5% Y/Y growth although it missed the consensus by $30M.

The company saw a large increase in profits: Q2 net income was $757 million, or $2.46 per share, compared with net income of $119 million, or $0.39 per share for Q2 2023 while adjusted net income clocked in at $809 million, or $2.62 per share, compared with $201 million, or $0.65 per share, in the second quarter of 2023.

Hess's production increased 27.6% to 494,000 barrels of oil and gas per day (boepd), thanks in large part to a 75% year-over-year increase in Guyana to 192,000 bpd, up from 110,000 boepd in the prior-year quarter.

The company’s Bakken shale output was 212,000 boepd, up 17% from 181,000 boepd in the second quarter of 2023. Hess, however, reported it expects a fall in current-quarter production due to planned downtime in Guyana and Southeast Asia.

Hess owns a 30% stake in the Guyana oilfield while Exxon Mobil Corp. and China’s CNOOC own 45% and 25% stakes, respectively.

Meanwhile, messy, messy, messy: 

Back in May, Hess shareholders signed off on its proposed $53B merger with Chevron Corp. despite the deal being challenged by Exxon Mobil Corp. .

Exxon is trying to stop the merger with the future of the deal resting on whether the transaction would involve a change of control of Hess' Guyana subsidiary. Exxon claims Hess should have first given it the opportunity to purchase its stake in the prized Guyana asset, and that Chevron structured the deal in a way to bypass Exxon’s right of first refusal if it’s triggered by a change of control in Guyana.

Market caps:

• XOM: $540 billion
• CVX: $300 billion
• HES: $50 billion

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Hess
Earnings, 2Q24

Link here.

Insight On The Demise Of The Keystone XL Project -- A Minority View? -- IEEFA -- July 31, 2024

Locator: 48279XL.

Link here.

IEEFA's bottom line: the pipeline was not necessary and not in the public interest, and in fact, the operator / developer did better in the long term, and, oh, by the way, Canadian resources were never that great to begin with. 

The AI Revolution Marches On -- July 31, 2024

Locator: 48277TECH.

Background:

• Tech is tracked here.
• Chips are tracked here.
• The importance of knowing the difference between GPUs and CPUs.  I forget who asked but someone on  CNBC -- "Half-Time Report? -- actually picked up on this. I was impressed.  It's also important to know who different assemblers "deal with" GPUs, CPUs, FPUs, neural engines. See System on a chip (SOC): link here.

Updates

Historical, revenue, link here:

July 31, 2024: if you view one thing today, it. needs to be the interview between Jim Cramer and AMD CEO Lisa Su. I started my position in AMD after reading the Barron's article in the issue that featured Lisa Su on the front page -- many months ago. She seems to be a lot like the OXY CEO Vikcy Hollub.

July 30, 2024: never quit reading. Link here.

July 31, 2024: CNBC practically giddy over the amount of money META and MSFT are going to be spending on Nvidia chips. Apparently META is Nvidia's biggest customer, and MSFT is going to spent $85 billion on Nvidia chips this year. Needs to be fact-checked -- heard in passing.

Link here.

I simply don't think folks / investors understand how big a deal the AI revolution is.

AMD: long interview with CEO on CNBC today. Shares up 7% today.

MSFT: link here.

From the linked article:

On the face of it, Microsoft had a decent quarter. Yet the stock fell, and that reveals a lot about what markets expect with updates from the Magnificent 7 technology stocks, and earnings more generally, these days.

On the one hand, traders are looking for reasons to sell the big technology companies that have driven the overall market’s gains for a while now, as Barron’s has pointed out previously. Now the Great Rotation into other sectors is taking hold, the easiest way to invest in beaten-down stocks is to sell the shares that have already done well.

On the other hand, the money these companies are spending on AI is going to the balance sheets of chip makers like Nvidia . Despite its shares dropping almost 20% over the past month, Nvidia got a decent boost from peer Advanced Micro Devices ’ solid earnings report Tuesday. Others in the chip sector are also getting a lift from a report that President Joe Biden’s next round of restrictions on exports to China will exempt some key allies.

When it comes to AI hype, the divide between chip makers and the rest appears to be widening. It comes down to who’s already making money from it, and those who have aspirations to make money from it one day.here’s another dynamic, too. While Microsoft says its artificial intelligence business is doing great, traders are paying more attention to the mounting costs of investing in the new technology. AI may hold the key to big profits in the future, but for now, it’s still an expense on the income statement. The same is true for other tech giants like iPhone maker Apple, retailer Amazon, Facebook-parent Meta Platforms, and Google-parent Alphabet.

Worth A Stand-Alone Post -- July 31, 2024

Locator: 48276CASH.

Link here.

So, what do we do?

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Watching My Weight: Eating Salad

Cramer's First Hour -- July 31, 2024

Locator: 48275INV.

Tag: Corning, GLW, California DMW.

Update

Later, 11:12 a.m. CDT: CNBC practically giddy over the amount of money META and MSFT are going to be spending on Nvidia chips. Apparently META is Nvidia's biggest customer, and MSFT is going to spent $85 billion on Nvidia chips this year. Needs to be fact-checked -- heard in passing.

Later, 10:51 a.m. CDT:

Later, 10:48 a.m. CDT:

Original Post

Chicago PMI: 45.3 vs 45.5. Whoo-hoo!

Household cash:  link here.

Opening:

Hope you all bought on the dip: Nancy Pelosi.

AMD: long interview with CEO. Shares up 7% today.

NVDA: up 7.5% at the open. Hope you all took advantage of the dip yesterday, or actually this past week.

INTC: up 1.5% today. Down 14% for one full year.

F: pain continues. Down at the open. Trading at 11.78. Down 15% past month.

GM: down 6% past month.

Boeing’s losses astounding. Not likely over even with new CEO. “Kitchen-sink” quarter yet to come.

Delta’s CrowdStrike problem.

OXY vs S&P 500: excruciating.

MSFT investors upset: Azure growth only 31%.

TMUS: huge beat; shares surge. Our carrier. Whoo-hoo! Fiber vs fixed wireless. Five million subscribers in three years. Fan of Apple. Looking for an interesting rollout. Cable streaming.

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Working On Their Aeroplanes

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Painting By Sophia

Acrylic on canvas, perhaps my favorite medium.

A lot of subtleties in this painting for a ten-year-old.

Wednesday, July 31, 2024

Locator: 48274B.

The big investing story today: AMD.

The big Bakken investing story: Hess. Link here.

• Bakken net production was up 17% q/q
• net income: $2.46 / share vs 39 cents, 2Q23
• net income increase reflects higher production volumes and realized selling prices

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Back to the Bakken

WTI: $76.88. Up $2.15 but very, very temporary unless ...

Thursday, August 1, 2024: 61 for the month; 61 for the quarter, 387 for the year
40411, conf, CLR, Anheluk 4-26H,
40263, conf, Stephens Williston, Cabot 15591-0112-3H,
40089, conf, Phoenix Operating, Jean Ferari 26-35-2 4H,
40088, conf, Phoenix Operating, Jean Ferrari 26-35-3H,
39604, conf, Hess, BL-Iverson B-LN-155-95-0807H-1,

Wednesday, July 31, 2024: 56 for the month; 56 for the quarter, 382 for the year
40412, conf, CLR, Anheluk 5-26HSL,
40176, conf, Slawson, Cyclone 5-21-16H,
40086, conf, Phoenix Operating, Jean Ferrari 26-35-2 1H,
39514, conf, Liberty Resources, Haley E 158-93-29-32-4MBH,

RBN Energy: could more NGL pipeline capacity help break the Bakken's production-growth logjam? Archived.

Crude-oil-focused production in the Bakken still hasn’t fully recovered from its pre-COVID high, partly because the western North Dakota shale play continues to face takeaway constraints, especially for natural gas and NGLs. A couple of NGL pipeline projects in the works will certainly help, but will they be enough to enable the Bakken’s increasingly consolidated E&P sector to ramp up its crude oil production? And one more thing: How will the incremental NGLs flowing south on Kinder Morgan’s soon-to-be-repurposed Double H Pipeline find their way to fractionation centers in Conway and Mont Belvieu? In today’s RBN blog, we’ll look at the Bakken’s complicated production-vs.-takeaway conundrum and the ongoing efforts to address it.

No Special One-Time Items? July 31, 2024

Locator: 48273HESS.

Link here.

F-35 Strike — July 31, 2024

Locator: 48272MIDEAST.

Link here.