The Impact of Harvey on Crude Oil Markets -- RBN Energy -- September 1, 2017

Smart move: oil glut, refineries shut down, and government begins releasing oil from the SPR. 

Active rigs:

$46.94↓↓	9/1/2017	09/01/2015	09/01/2014	09/01/2013	09/01/2012
Active Rigs	56	76	194	184	192

RBN Energy: the impact of Harvey on crude oil markets.

Our preliminary estimates for the U.S. averages for this past week are that crude oil production will be down by 0.8 MMb/d to 8.7 MMb/d, reflecting about 1.2 MMb/d of production offline at the peak of the outage (mostly offshore and Eagle Ford). Imports are expected to be down by about 1.1 MMb/d to 6.8 MMb/d due to significant cargo cancellations into the Gulf Coast.

Consequently, total supply is projected to be down by 1.9 MMb/d (compared to the previous week) to about 15.5 MMb/d. Refinery-run reductions are projected to peak at about 3.0 MMb/d (up to more than 4.0 MMb/d including Port Arthur/Beaumont outages that did not happen until later in the week).

That works out to a decline in refinery runs of about 2.1 MMb/d for the week. Exports are projected to be down to about 0.3 MMb/d, or about 0.6 MMb/d below last week.

As a result, total demand is estimated to be lower by about 2.7 MMb/d to 16.0 MMb/d, implying a storage withdrawal of about 3.3 MMbbl.  After we did those numbers, on Thursday, August 31, DOE released 1.0 MMbbl of oil from the Strategic Petroleum Reserve on an exchange deal with Phillips 66 for their Lake Charles refinery.
Regardless, if these numbers are in the ballpark, instead of building inventory because of all the refinery outages, the industry will withdraw from inventory due to production shortfalls and especially lower imports.

But don’t forget, much of the inventory is still sitting in vessels out in the Gulf of Mexico, just out of the reach of government statisticians. These volumes will be coming in just as soon as Gulf Coast docks are up and running. 

President Trump To Visit North Dakota On T+229 (September 6, 2017)

Link here. On September 6, in the following years:

• 1620: the Mayflower departs Plymouth, England
• 1901: US President William McKinley shot by Leon Czolgosz, an anarchist, while visiting the Pan-American Exposition in New York
• 1966: Margaret Sanger, "founder of 'Planned Parenthood,' dies in Tucson; never played any role in the crusade to make abortion legal, but funded the physician who "invented" the birth control pill, Enovid;

And relevant for Williston, which had a Piggly Wiggly, across the road from Harmon Park:

• 1916: the first true supermarket, the "Piggly Wiggly" is opened by Clarence Saunders in Memphis, Tennessee

The Energy And Market Page, T+223 -- August 31, 2017

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

This market is just remarkable. The NASDAQ apparently hit an all-time closing high today, although not an intra-day high, according to CNBC. I can't verify that, but record or not, it was another remarkable day.

Likewise, the Dow just missed a gain for the month of August, as far as I could tell, but I could be wrong. During this past month, when there was a pullback in the Dow many pundits, including Jim Cramer, said it was not unusual for the market to pullback in August.

From this USA Today story, July 25, 2017:

In the past 20 years, August is the worse month for the Dow's performance, with an average drop of 1.4%. And September hasn’t fared much better, posting average losses of nearly 1%, which is the third-worst monthly ranking. If you go back 100 years, September is the Dow’s worst month of the year.

Investopedia says September, on the other hand, is the worst month for investing:

One of the historical realities of the stock market is that it typically has performed poorest during the month of September. The "Stock Trader's Almanac" reports that, on average, September is the month when the stock market's three leading indexes usually perform the poorest. Since 1950, the month of September has seen an average decline in the Dow Jones Industrial Average (DJIA) of 1.1%, while the S&P 500 has averaged a 0.7% decline during September. Since the Nasdaq was first established in in 1971, its composite index has fallen an average of 1% during September trading. This is, of course, only an average exhibited over many years, and September is certainly not the worst month of stock-market trading every year.

Bloomberg says October is the worst month for the market and, of course, Black Monday, 1987, occurred in October.


And, of course, "everyone" says to "sell in May and go away.

And, yet, with all that, futures, right now, are again green for equities. 

Ten New Permits; WTI Recovers A Bit; Gasoline Spikes Post Harvey; Panic Buying In The US; NASDAQ Hits New All-Time Record -- August 31, 2017

Active rigs:

$47.09↑↑	8/31/2017	08/31/2016	08/31/2015	08/31/2014	08/31/2013
Active Rigs	55	33	76	194	185

Ten (10) new permits:

• Operators: Enerplus (9); Iron Oil Operating LLC
• Fields: Moccasin Creek (Dunn); Antelope Creek (McKenzie)
• Comments: Enerplus  has permits for a 9-well "heavy metal" pad in Moccasin Creek in NENE 16-147-93 (see graphic below)

Iron Oil Operating:

• has 21 oil and gas permits
• permits in Antelope Creek, Bear Butte, Sather Lake, Ellsworth, others
• from "Bakken Operators":

Iron Oil: first mentioned on the blog, July 18, 2017

• about 21 wells transferred from Hunt Oil Company to Iron Oil Operating, LLC
• I believe this is a new entrant into the Bakken
• a Billings, MT, company
• website here

****************************

See Enerplus Permits Above

This page will not be updated. The "heavy metal" pad is now tracked here.

Enerplus' "heavy metal" pad:

• 33967, 3,162, Enerplus, Cobalt 147-93-09D-04H, Moccasin Creek, t7/18; cum 202K 3/19;
  

  Date	Oil Runs	MCF Sold
  10-2018	25330	19107
  9-2018	28494	4887
  8-2018	50811	2650
  7-2018	22630	2650

• 33968, 932, Enerplus, Nickel 147-93-16B-21H-TF, Moccasin Creek, 33 stages; 5.9 million lbs, t8/18; cum 110K 3/19;
  

  Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
  BAKKEN	10-2018	30	17554	17484	19817	12287	6796	4413
  BAKKEN	9-2018	22	19992	20032	20766	13994	9247	4094
  BAKKEN	8-2018	31	28292	27958	38928	19805	58	19746
  BAKKEN	7-2018	1	236	226	3493	165	58	106
  BAKKEN	6-2018	1	6	0	0	0	0	0

• 33969, 1,077, Enerplus, Steel 147-93-09D-04H-TF, Moccasin Creek, t8/18; cum 138K 3/19;
  

  Date	Oil Runs	MCF Sold
  10-2018	17276	13032
  9-2018	26442	4535
  8-2018	35723	108
  7-2018	923	108

• 33970, loc, Enerplus, Tungsten 147-93-16A-21H,

  Date	Oil Runs	MCF Sold
  10-2018	20759	8070
  9-2018	26189	12090
  8-2018	47693	4504
  7-2018	17534	4504

• 33971, loc, Enerplus, Zinc 147-93-09D-04H,

  Date	Oil Runs	MCF Sold
  10-2018	29954	22595
  9-2018	28946	4965
  8-2018	50356	1622
  7-2018	13855	1622

• 33972, loc, Enerplus, Lead 147-93-16B-21H-TF, 

Date	Oil Runs	MCF Sold
10-2018	18145	7053
9-2018	26668	12311
8-2018	34631	1747
7-2018	6802	1747

• 33973, loc, Enerplus, Titanium 147-93-16A-21H,
• 33974, loc, Enerplus, Silver 147-93-09D-04H,
• 33975, loc, Enerplus, Platinum 147-93-16A-21H,

Yup, The NASDAQ Hit A New All-Time Record -- Make America Great -- Trump, Catching The Wave -- T+223 -- August 31, 2017

NASDAQ hits a new all-time high: 6,429.

I think the Dow squeezed out a "positive" for the month of August but it will be close.

Before Hurricane Harvey: no effect on US GDP.

After Hurricane Harvey: OMG. The sky is falling. Huge impact on GDP.