EU On The Ropes -- June 14, 2018

First, this reminder:

Then there is Brexit, and then talk of an Italian exit. Turkey isn't helping things in Europe, and, of course, President Trump's focus is shifting to China, Korea, Japan.

And, then, of course, the whole immigration issue.

Now, on top of all this, EU's growth engine says "no" to EU's renewable energy proposals.

A huge "thank you" to a reader who spotted this. This story is not going to be reported by the mainstream media any time soon. You can find it at the Euractive website:  I have no idea how a reader would ever stumble upon this gem. The headline: Germany pours cold water on EU's clear energy ambitions.

Voters across Europe have lost faith in politics partly because of “unachievable targets” on renewable energy, said German Energy Minister Peter Altmaier, who rejected calls from a group of other EU countries to boost the share of renewables to 33-35% of the bloc’s energy mix by 2030. Altmaier made the comments during an on-the-record exchange between the 28 EU energy ministers, who are gathered in Luxembourg today (11 June) for a meeting of the Energy Council.

Energy ministers are expected to thrash out a joint position on three clean energy laws which are currently being negotiated in the EU institutions – the Renewable Energy Directive, the Energy Efficiency Directive and a regulation on the Governance of the Energy Union.

“Germany supports responsible but achievable targets,” Altmaier said from the outset, underlining Berlin’s efforts to raise the share of renewables to 15% of the country’s overall energy mix.

But he said those efforts also carried a cost for the German taxpayer, which he put at €25 billion per year. “And if we are setting targets that are definitely above 30%, that means that within a decade, our share has to be more than doubled – clearly more than doubled,” Altmaier pointed out.

“We’re not going to manage that,” Altmaier said referring to an objective of putting 1 million electric vehicles on the road by 2020 in Germany. “Nowhere in Europe is going to manage that,” he claimed. “And even if we did manage to get enough electric cars, we wouldn’t have enough renewable electricity to keep them on the road,” he stressed.

So many story lines. I particularly liked that last line: even if we did manage to get enough electric cars, we wouldn’t have enough renewable electricity to keep them on the road.

By the way, the Germany announcement coincides with that of China's recent announcement to shut down solar growth. 

Burnaby Says Bye-Bye To Fuel Cell Venture -- June 14, 2018

Until the Trans Mountain Pipeline Expansion project came along, I was probably the only person in North America who had not heard of Burnaby, British Columbia.

Now, Burnaby, is ground zero for those who hope to stop the pipeline project.

But, it turns out, there's something else coming to a stop in Burnaby.

Reuters is reporting that Ford and Daimler will end their fuel cell joint venture based in Burnaby.

Both companies will take their respective fuel cell technology development in-house.

The Automotive Fuel Cell Cooperation Corp venture, based in Burnaby, British Columbia, will close this summer.

Despite years of research and investment by major automakers and startups, vehicles powered by fuel cells remain a tiny niche in the global vehicle market.  

Meanwhile,

Honda Motor Co and General Motors Co are collaborating on fuel cell development, and Toyota Motor Corp is ramping up efforts to mass-produce fuel cell stacks. Earlier this week, Ballard Power Systems Inc extended a contract with Volkswagen AG’s Audi unit to work on fuel cell development.

Steady As She Goes -- June 14, 2018

Active rigs:

$66.96↑	6/14/2018	06/14/2017	06/14/2016	06/14/2015	06/14/2014
Active Rigs	62	55	28	75	187

RBN Energy: will Petronas' stake finally make the LNG Canada export project a reality?

Now, with LNG demand on the upswing and the need for additional LNG capacity in the early-to-mid 2020s apparent, the co-developers of LNG Canada — Shell, PetroChina, Korea Gas and Mitsubishi — have attracted a new and significant investor: Petronas, Malaysia’s state-owned oil and gas company and owner of Progress Energy Canada, which has vast gas reserves in Western Canada. Today, we continue our review of efforts to send natural gas and crude oil to Asian markets with a fresh look at the LNG project and TransCanada’s planned Coastal GasLink pipeline, which will deliver gas to it.

Random Update Of Bakken Well EURs -- CLR's May, 2018, Corporate Presentation

For newbies: this has nothing to do with investing. This has everything to do with the potential of the Bakken. Jane Nielson probably knows more. 

EUR type curves, for CLR:

• 2011: 430 mboe
• 2014: 603 mboe
• 2015: 800 mboe
• 2017: 980 mboe
• 2018: 1,100 mboe ($7.9 million) 
• "all optimized completions" now exceed the 1,100 mboe EUR type curve

Production:

• 1Q18, 161K boepd; up 48% from 1Q1 

Tea Leaves Suggest Price Of Oil To Rise -- June 13, 2018 -- Venezuela Imports Oil To Meet Refinery Demands

Updates

June 25, 2018: still very bullish for oil even after OPEC+ announcement. Saudi production from another source (link lost) -- note: this is total production, not exports. Women given the right to drive should increase local demand at least to some extent.

Original Post

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

Disclaimer: it's a fool's errand to predict oil prices, including the trend.

Note: this could all be greatly affected if Russia and Saudi Arabia agree to increase production. We will know more by the end of June / July. "Those" tea leaves suggest Russia and OPEC will raise production using the excuse that loss of production in Iraq, Iran, Venezuela and global demand forecasts for 2019 necessitates such action.

Sixteen reasons:



Re-posting:

WTI: the tea leaves suggest the price of WTI will continue to rise -- let's stir the tea -- (note to newbies: "tea leaves" have a mix of fact and opinion and it's not necessarily easy to tell them apart; tea leaves look alike) --

• a graphic earlier today suggested Saudi Arabia "spare capacity" forecast to shrink significantly in 2019
• there's a story over at oilprice.com suggesting US shale oil won't be able to fill the gap
• the Permian pipeline shortage won't be resolved before 2019
• the Trans Mountain Pipeline expansion project won't be completed this year (if ever)
• not even the height of summer driving season, and US gasoline demand hits a new record
• refiners are operating at 95.7% capacity and having trouble keeping up with distillate fuel demands
• distillate fuel reserves in the US hit an all-time (if not an all-time low, very close; certainly appeared that way on the graph; needs to be fact-checked)
• China recently shut down new solar installations, suggesting they need more fossil fuel sooner
• Venezuela may import heavy oil to meet refining needs (see below)
• Iraq's instability may affect production
• Iran's sanctions will cause greater shortfall than some pundits suggest 
• the chairman of the "US Fed" said their will be four rate hikes this year, partly because "they" expect the price of oil to increase by the end of the year, causing inflationary pressure on the economy

Now, some background stories.

First a graphic: US gasoline demand sets a record --

Venezuela: may import oil for the first time in its history to meet refining needs. [Later: it's now announced -- Venezuela is importing oil to meet refinery demands.]

• the state-run oil company has drawn up plans to import 57,000 bopd to meet demands of its largest refinery
• would need to be heavy oil
• Russian and Chinese customers probably putting the "screws" to PDVSA
• the refinery's capacity: 1.3 million bopd; breaking down; not being maintained
• no comment by Reuters suggesting how this all came about

Shale oil can't fill the gap anticipated in 2019 -- IEA: from oilprice -- actually IEA didn't say that explicitly -- there were a lot of qualifiers -- Nick Cunningham seems to be putting words into the IEA statement -- I didn't see anything in the article that alarmed me.

Spare capacity: posted earlier; I'm not concerned with this data, either.