Off The Net For Awhile -- June 15, 2018

I am really burned out. Just too much news. Scott Adams suggested the same thing earlier today.

Therefore, I don't plan to do much blogging tonight. I'm not sure how much blogging I will do over the weekend.

The numbers coming out of the Bakken have completely blown me away. I suspected this -- based on the number of DUCs still being reported and the size of the wells that are being reported that are being completed -- but even though I suspected this, I am surprised -- blown away -- by these numbers.

I need to take a break to digest all of this.

Good luck to all.

One last thought. Scott Adams suggests we are entering a Golden Age. I completely agree. I feel badly for those young folks with little worldly experience that are foregoing investing opportunities because they are being sucked in by negative news in the business pages.

I began investing in 1984. I don't recall a more exciting time to be investing.

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or think you may have read here.

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A Note To The Granddaughters

I came of age in southern California. I have pretty much lived all over the world -- except the Far East. I have fond memories of many places I've lived and would love to return to many of them, even live out the rest of my life in any one of them if it were possible.

But at the end of the day, the "land" that keeps pulling me back is southern California, most specifically South Pasadena.

A Summer Place is not set in southern California. It is set about as far away in the US from California as it could possible be. But I bet a lot of folks, who have never seen the movie, including me, assume it was set in California. Nor was Peyton Place set in California. Nor was The Summer of '42. Wow, that was a tough movie for me to watch. 1971 -- junior in college and too many things in my life going on. And then complicated by my own "summer of '71." When I met the love of my life.

Again, a reminder: I have not watched any television all day (except for the US Open) and I do not plan to watch any television (other than golf, Big Bang Theory, and Seinfeld) until the "markets" stabilize. Things are getting way too crazy.

I assume I will not be watching television (except as noted) no sooner than Monday, June 24, 2018 -- and then I will be traveling. Whatever.

My sources of news are primarily:

• Drudge Report links to US economy;
• twitter links to oil sector;
• Scott Adams;
• and, whatever readers send me.

Therefore, I can honestly say I probably have absolutely no idea what's really going on. Well, let me say it differently. I think I know what's going on but I have absolutely no way to explain any of it.

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Some of this is going to be repetitive -- these thoughts go all the way back to the beginning of the blog. Mostly for newbies. Regular readers of the blog should "know" me by now. A lot of hyperbole. I am inappropriately exuberant about the Bakken.

But for newbies, this is my take with regard to the oil sector.
predicting the price of oil is a fool's errand
oil production from only three countries really matters any more: Saudi Arabia, the US, and Putinstan
Venezuela, sitting on the world's largest reserves of crude oil, implodes; imports oil for the first time ever; and, the price of WTI and Brent plummets
How can that be?
a reader sent me a note when I asked that question. The reader's answer: look at the Bakken revolution (not just the "geographic" Bakken but the "Bakken" revolution
unfettered, the Bakken can produce 2.2 million bopd (currently North Dakota is producing in excess of 1.2 million bopd; will probably set a record in May or June; already production is ahead of schedule)
in the Bakken, upwards of 50% of wells drilled to depth are not being completed; they are called drilled but uncompleted wells (DUCs); with EURs of 500,000 bbls/well, this storage-in-situ (SIS) equates to about 1,000 wells x 500,000 bbls/well = 500,000,000 bbls of oil
this is just the Bakken; long term I think the Bakken may produce more oil than the Permian but right now the analysts tells us the Permian is a better crude oil play; so whatever numbers you see for the Bakken, right now you can probably triple them for the Permian
the Eagle Ford is probably going to be half- to three-quarters that of the Bakken in the near term
we're now hearing stories that legacy oil fields in the US are starting to come back, using technology learned by US shale operators; legacy oil fields are old conventional oil fields that many have thought were well past their prime; maybe not

Comments: Alert -- June 15, 2018

A reader alerted me to the fact his/her comments were not getting through to me; they were not being posted.

All comments are reviewed before being posted, but I post most comments if they add to the conversation. And if I post a comment, I almost always post a reply. Comments that are not published should not be a surprise to those who sent them.

So I was surprised to hear that comments were not getting through to me. I thrive on comments.

I checked my "settings" on the blogger app and I think I may have spotted one problem. I don't know how that "problem" happened but it has been corrected.

So, we will see if that fixes things.

Update: checking with blogger app -- it turns out that other bloggers are having the same problem. It may have something to do with new rules coming out of the EU. I cannot make this up. 

It's always something.

[If you want to send me e-mail, my e-mail address is found somewhere at the sidebar at the right. I don't save e-mail addresses and I pay absolutely no attention to the e-mail addresses. I pay attention to the "handle" because I recognize the "handles" of those who send me consistently great comments.]

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A Note for the Granddaughters

Updates

June 16, 2018: a reader writes that KUMV-TV went on the air in 1959. The Ray High School Band played at the "grand opening" ceremonies. The reader mentions he was once on a KUMV local talent show as a guest. I vividly remember going out to KUMV -- the tower and site was about six miles west of Williston -- to appear one some children's afternoon program. I think I was too old for Romper Room but it was possible it was Romper Room.

Original Post 

The television series Perry Mason ran on CBS from 1957 to 1966. Growing up in Williston, we got television about 1959. The first television station was KUMV-TV (K-upper Missouri valley) which was an NBC affiliate. I don't know when we got CBS and/or ABC, but I know KUMV / NBC television was our only option for many years.

So, I looked forward to our summer vacations to Rapid City, South Dakota, every summer to visit the Black Hills. We would spend one or two nights in Rapid City and we saw other stations. I vividly remember Perry Mason and Alfred Hitchcock Presents.

Wow, those were the good old days.


I never knew that Raymond Burr was screen tested for a part other than Perry Mason in the original television series. What a hoot.

Brilliant. Genius.

Wow, Wow, Wow -- June 15, 2018 -- The Bakken Is Setting New Records -- Ahead Of Forecasts

I did not see any television today. I am unable to access the NDIC. But look at this. From The Bismarck Tribune:

North Dakota oil production jumped 5.4 percent in April to more than 1.2 million barrels per day, coming in just shy of the state’s record.

Director of Mineral Resources Lynn Helms called it a big surprise to see production levels within 2,500 barrels of the all-time high of nearly 1.23 million barrels per day.

“We were not expecting that kind of a surge until late May, early June,” Helms said Friday while discussing the preliminary figures.

Natural gas production increased 7.4 percent in April, setting another record at more than 2.24 billion cubic feet per day.

Flaring: 

• natural gas production: jumped 7.4% in April; all-time record at 2.24 billion cubic feet/day
• natural gas flaring has returned to 2014 levels
• flaring jumped 91 million cubic feet/day since March -- the largest month-over-month increase ever
• it is likely that some operators will need to restrict oil production to meet flaring guidelines
• the state has been near 15% flaring limit for some time, but the reservation in April flared 22%
• five natural gas processing plants are under construction or in development
• expansion at one natural gas processing plant expected to be completed by the end of the year

And it goes on and on. Much more at the link. 

Wells: the number of active wells hit another all-time record -- 14,571 wells. 

Memo to self: send a note to Jane Nielson.

Idle Rambling -- Not Ready For Prime Time -- June 15, 2018

Updates

June 18, 2018: update of Venezuela exports. But this is the scary thing in the graphic below. Look at where the US Gulf Coast imports come from: Saudi Arabia; Mexico; Iraq; Canada; Venezuela -- none of them are very reliable any more, all for different reasons:

Original Post

 

I did not watch any television today except for the US Open (golf).

I have no idea what the talking heads said about what the price of oil did today.

All I know is this:

• Venezuela is importing heavy oil to meet demands of its one large refinery. Analysts suggest it is unlikely Venezuela will "turn around" any time quickly.
• WTI and Brent have an "awful" day. WTI falls almost 2.75%, loses $1.83, falling below $65/bbl, before closing at $65.06. Brent does even worse, falling more than 3.25%, losing $2.50/bbl, and closing at $73.44.

So, all that talk about how important Libyan oil is. All that talk about how important Iranian oil is. All that talk about how important Iraqi oil is. All that talk about how important Canadian oil is. All that talk about how important Venezuelan oil is. What a bunch of hogwash. Did I mention Brazil? Norway? North Sea?

The country with the largest oil reserves in the world. A huge exporter of heavy oil. And now it's importing oil to run its refineries. Venezuela.

And the price of WTI and Brent plummets.

I assume I'm missing something and the talking heads have all kinds of explanations for the fall in the price of oil today, but to me it certainly looks like the only three oil-producing countries that matter: Saudi Arabia, the US, and Putin.

On top of that, I read somewhere on the "internets" that China is going to increase tariffs on oil, natural gas, and refined products coming out of the US. That certainly suggests to me there is no shortage of oil. Or maybe there is and China is simply trying to get ahead of the curve by raising the price of gasoline for their citizens so they switch over to EVs.

Idle chatter. Not ready for prime time.