For The Archives -- An Obituary -- December 4, 2019

Page 82, the last page of the November 2nd - November 8th edition of The Economist. Here is the internet link, behind a paywall. It is interesting that the internet "header" is different than the hard copy.

Third paragraph from the end:

In the cities he conquered he set up offices to take in taxes and traffic fines, register babies and licence (sic) marriages, as in a proper state. He imposed the sharia in which he was expert: hands hacked off for stealing, whippings for drunkenness, adulterous women stoned. He also expanded it, justifying everything smoothly with holy writ. Unbelievers were expelled or killed if they did not pay their taxes. Yazidis were driven from their homes and their women abducted to be sold and raped with organised (sic) efficiency. Enemies were crucified, burned alive, drowned in cages, beheaded with slow saws, while everything was filmed and posted online for the world to observe and dread. He sometimes shared the videos first the kufr women he kept chained in a nearby room for his own pleasure. Raping an infidel woman was a spiritual exercise that brought a believer close to God.

Saudi Aramco IPO -- The Economist's Perspective -- December 4, 2019

The Economist. Hard copy. (I assume the internet edition is behind a paywall.)

November 2nd - 8th, 2019.

Front cover, "To The Last Drop: Saudi Arabia's Strategy to Survive The End Of Oil."

Op-ed on page 11.

Three-page essay, starting on page 61.

First from the op-ed, page 11, near the end of the op-ed, verbatim:

America, meanwhile, remainswedded to oil, which meets 40% of its energy needs. Its thirst has been satisfied by the fracking boom, especially in he Permian basin in Texas. Yet fracking is dirty and new projects need an oil price of $40 - $50 a barrel to break-even, at twice the level Aramco requires. For the sake of the climate and efficiency, the fracking industry should eventually shrink. That, though, would make America more reliant on foreigners, just as its politics have turned inward.

Now, from the essay, page 63:

Aramco's breakeven costs for new projects, even after tax, are $31, according to Rystad Energy's data, slightly higher than Iran, Iraq or Kuwait but less than half the level of Russiant and wo-thirds the level in America.

From the NDIC, breakevens in the Bakken, released August 15, 2019:

 

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One comment: The Economist again disingenuously omits the fact that Saudi Arabia's budget is based on its only export product: oil. Several years ago Saudi said it needed $100/bbl to balance its budget. When the price of oil plummeted, Saudi Arabia initially said they only needed $80/bbl and then said they could meet their budget even at $60/bbl (Brent). Production costs are important, even for Saudi Arabia, but failing to state the budgetary requirements for Saudi Arabia completely misses the bigger picture. 

MRO With Six New Permits; One DUC Reported As Completed -- December 4, 2019

Active rigs:

$58.30	12/4/2019	12/04/2018	12/04/2017	12/04/2016	12/04/2015
Active Rigs	56	64	53	39	64

Six new permits, #37241 - #37246, inclusive --

• Operator: MRO
• Field: Killdeer (Dunn)
• Comments: 
• MRO has six permits for lot 4 / section 3-145-94, Killdeer oil field

One permit was renewed:

• BR: a Hawktail permit in Dunn County

One permit was canceled:

• Oasis: a Hendricks permit in Williams County

One producing (DUC) was reported as completed:

• 29568, 99, SHD, Wiley 24-30H, Deep Water Creek, t10/19; cum --;

Colombia Crude Oil Exports To US Plummet Week-Over-Week -- December 4, 2019

Imploding? From twitter --

Colombia's crude oil exports to the US crumbling, link here;

Having said that, Colombia's exports to the US are very "volatile." (See first comment.)

I assume Colombia's oil is "heavy oil." If it's Castella Blend, it's very, very, very heavy:

For comparison, western Canadian select, WCS, heavy oil, has an API of 20.9. Bakken, a very light oil, is in the 41+ range.

EIA's Weekly Petroleum Report; WTI Surges -- December 4, 2019

Weekly Petroleum Report:

• US crude oil in storage: 447.1 million bbls
• week-over-week oil in storage: decreased by a whopping 4.9 million bbls
• refiners operating at 91.9% capacity; slowly creeping up; well below the norm;
• crude oil imports are down over 20% over the same four-week period last year
• all things being equal, WTI should be up nicely, unless movers and shakers knew these numbers last night; so let's check WTI: up 3.67%; up $2.06; trading at $58.16 -- back to where it was last week when it plunged; 

Re-balancing (note: many lines/weeks hidden to keep graph manageable):

Week	Week Ending	Change	Million Bbls Storage
Week 0	November 21, 2018	4.9	446.9
Week 1	November 28, 2018	3.6	450.5
Week 2	December 6, 2018	-7.3	443.2
Week 3	December 12, 2018	-1.2	442.0
Week 4	December 19, 2018	-0.5	441.5
Week 5	December 28, 2018	0.0	441.4
Week 43	September 18, 2019	1.1	417.1
Week 44	September 26, 2019	2.4	419.5
Week 45	October 2, 2019	3.1	422.6
Week 46	October 9, 2019	2.9	425.6
Week 47	October 17, 2019	9.3	434.9
Week 48	October 23, 2019	-1.7	433.2
Week 49	October 30, 2019	5.7	438.9
Week 50	November 6, 2019	7.9	446.8
Week 51	November 14, 2019	2.2	449.0
Week 52	November 20, 2019	1.4	450.4
Week 53	November 27, 2019	1.6	452.0
Week 54	December 4, 2019	-4.9	447.1