Energy Transition Is Over -- You Just Don't Know It Yet -- October 25, 2023

Locator: 45834ESG.

Link here.

The Energy Transition Is Already Dead -- We Just Don't Know It Yet -- Peter Zeihan -- October 4, 2023

Locator: 45648ESG.

Saudi Arabia: killing the renewable energy sector. Link here. 

Also, "energy transition is dead, we just don't know it yet" -- Peter Zeihan, link here. 

Re-posting: Javier's observation is 99% of the reason for the re-post but the comments are very important. At the link (first link above).

Not enough folks are talking about the observation by some that Chinese dumping US Treasuries is contributing to the problem.

For The Archives -- On The US Economy -- February 24, 2023

Based on the economic news / economic indicators that came out today and the rumblings on twitter a couple of comments with regard to the US economy:

• there is now no longer any question that it's "higher for longer"

There are obviously three questions:

• when will the Fed rate hit 6% -- before the end of 2023, or in early 2024?
• how high will the Fed rate go before the end of 2024?
• how long will the Fed rate stay above 5.5%? Through 2025 or longer?

My hunch:

• the best we can hope for: a very long period of whatever it is we are now in -- perhaps two more years of "this";
  
• more likely: an incredibly hard landing, but one which affects all of us very, very differently.

With regard to investing, two things are going to happen: 

• folks investing in ESG / "woke" companies will finally get serious about investing and will leave those companies in droves;
• this will be the end of most publicly traded EV manufacturers.
  

I flip-flop on Tesla all the time, but right now, relative to others, it looks stronger than ever. 

This will be the end of ESG. Tracked here. Sort of.

From May 5, 2022:

The energy transition is dead. Tracked here. 

• ESG is dead, too. Tracked here. 

Peter Zeihan was the first to say it. 

Best, newest example to support that contention, that energy transition is dead: despite sanctions on Russia is able to sell all the oil it produces, and it is actually, in many cases, selling it at higher prices than sanctions allow. 

Even President Biden says oil is here for at least another decade. LOL. Another fifty years.

ESG Is Dead -- Coal's Season To Shine -- October 9, 2022

Themes.

Themes - 2023.

Added: "ESG is dead."

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Updates

War on Larry Fink and BlackRock, link here.

Laugh, link here:

Jamie Dimon understands, link here:

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Original Post

First posted here, October 8, 2022.

From twitter:

ESG Is Dead -- October 8, 2022

My "oil" portfolios are outperforming all my other "portfolios." 

ESG is dead. Link here.

From April 17, 2022:

Link here. 

From "Themes."

The energy transition is dead. Tracked here. 

• ESG is dead, too. Tracked here.

Energy Transition is dead. 

I don't subscribe to Barron's but that may be what I may think about as a birthday present. But then I read somewhere that Barron's has really gone downhill. I don't know. 

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RBN Energy

RBN Energy yesterday: E&Ps shower cash on shareholders as cash flows rise with soaring oil and gas prices.

Just two years ago, the onset of the pandemic slashed the share prices of many oil and gas producers and the idea of parking cash in a U.S. E&P seemed to make as much sense as leaving your Porsche on a midtown street with the keys in it and the motor running. But times — and commodity prices — have changed, and hydrocarbon producers have transformed themselves into cash-flow-generating machines that attract the sagest investors. Want proof? Warren Buffett’s Berkshire Hathaway recently purchased another 10.4 million shares of Occidental Petroleum (Oxy) for over $500 million, bringing its stake in the company to a substantial 16.4%. In today's RBN blog, we detail how the major U.S. E&Ps are allocating their cash flow to keep investors happy.

What a difference two years makes! In our July 2020 blog Stayin’ Alive, we discussed Oxy’s chances of recovering from the massive $36.5 billion debt it had accumulated in its ill-timed $58 billion acquisition of Anadarko Petroleum just before oil prices started to plummet in mid-2019. With its investment rating reduced from investment grade to junk, the company slashed its quarterly dividend from $0.79/share to a token $0.01, cut capital spending, and launched a major divestiture program. But soaring commodity prices have subsequently bailed out Oxy and the industry. Embracing fiscal discipline and eschewing production growth in favor of cash generation, E&Ps are transforming into significant yield vehicles — a turnaround that's led to a fivefold increase in the S&P E&P stock index. Producers who survived the pandemic with strong balance sheets, such as Pioneer Natural Resources, Diamondback Energy, Devon Energy, and EOG Resources, are already providing 10%-plus annual returns through a combination of regular and variable dividends and share repurchases. Others, like Oxy, have channeled growing cash flows to meet debt-reduction targets as they transition to significant shareholder returns.

RBN Energy today: refinery shutdowns around the world, part 2.

We often tend to focus on the U.S. refining picture, but, just like crude oil, refined products trade globally, and international closures ultimately have the same effect as domestic ones on the worldwide products market. Recent international closures have been distributed throughout the world — concentrated in developed countries, including several in Europe, as well as Japan, Singapore, Australia and New Zealand, but also in some developing economies like South Africa and Sri Lanka. Most of these capacity reductions were driven by the same forces as in the U.S., namely, poor economics as a result of the pandemic-lockdown-driven demand plunge in 2020 and 2021, as well as expectations that margins would take a long time to recover post-COVID. Of course, worries that the energy transition and policies to that end would suppress demand in the long-term also played a key role, as did some fundamental competitiveness issues at individual facilities. In today’s RBN blog, we take a closer look at the more than 2 MMb/d of international capacity closures since 2019.