WTI Takes Huge Fall; Down 5%; Will Test $38 -- October 1, 2020

Oil traders must be reading the blog. Before the trading day started, I suggested folks may want to re-visit the history of the Spanish Flu to get an idea of where we are with regard to Covid-19.

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Duolingo

Of all her apps, and of all her "streaming" activity, 6-y/o Sophia's favorite activities:

• when she signs into her class on Webex twice daily; she loves it not so much for the actual education as for seeing her teachers and her friends; she signs on for thirty minutes every morning and thirty minutes every afternoon;
• Duolingo: her Spanish app;

Her older sister helps Sophia with her morning sessions, and I have her for the rest of the day, from 12:00 noon to 7:00 p.m., though she spends part of those seven hours elsewhere. 

Our first activity at 12:00 noon is physical education. She loves that and it's easy to do. The p/e teacher has a daily exercise assignment; Sophia accomplishes that, and I take a video and send it to her teacher.

After that, Humanities (generally a reading and writing assignment) which generally takes about thirty minutes. Then we check the status of assignments in art and music. 

Then ten minutes of Duolingo and ten minutes of piano. Both are apps and although piano practice is "a pain," she is making progress, slowly but surely.

But Duolingo! Wow, she loves it. It's her favorite educational app. I think she enjoys it for several reasons:

• she gets to use the  Pencil;
• I am learning Spanish with her, but she guides the lessons; I think she feels she is competing with me and beating me; she if very, very competitive;
• the application, for some reason, is addictive -- as noted by an early reviewer;
• just challenging enough; it's almost like a puzzle every day; solving translations, English-to-Spanish and Spanish-to-English

Lithium -- October 1, 2020

Re-posting:

Lithium:

• one will start seeing a lot of stories on lithium; shortages, high prices, etc. But one thing remains: at the end of the day there will be a surplus of lithium. It may be expensive until supply and demand even out, but there won't be any shortage.
• major supply shortage; link to Tsvetana Paraskova;
• lithium recovery from oil and gas produced after (including the Bakken); link here to ACS Energy Letters;
• shale boom could fuel batteries; link to Earth: The Science Behind the Headlines; 
• lithium: world class deposit, link to investingnews; 
• Nevada is home to the only operating lithium mine in the United States which is located in Clayton Valley, Esmeralda County. The mine has been in operation since 1967, employs 85 people, and produces lithium carbonate from evaporation ponds which concentrate the lithium.
  

Tesla: one step ahead; link here;

• failed to reach a deal with Cypress Development Corp., which focuses on extracting lithium from clay deposits in southwestern Nevada;
• Tesla has secured access to 10,000 acres of lithium-rich clay deposits in Nevada, and plans to use a new, “very sustainable way” of extracting the metal.
• announcement followed pledges from the car and battery maker to produce a cheaper, lower-cost battery, build a $25,000 electric car and eventually produce 20 million vehicles a year.
• also announced deal with Glencore for cobalt; huge need for cobalt; cobalt may be the "big problem," but lithium, probably not;
  

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Apple

iPad: new iPad Air "available in October." Apparently one can order it now, but no delivery date yet established? Base model, wi-fi only, 64 GB, $599; 256 GB, $749. Seeing all the apps that 6-y/o Sophia "needs" on her iPad for school, I highly recommend springing for the 256-GB model.   Pencil essential.

With regard to connectivity, I've learned to "do without." Of the three mobile devices I carry when traveling (an iPhone, an iPad, and a MacBook Air), only the iPhone has cellular in addition to wi-fi. One can find free wi-fi almost anywhere -- although more of a pain with "everything closed due to Chinese flu"; while driving I tend not to use my iPad or my laptop.

MacBook: if you need it for work, get the MacBook Pro 16", but for home use, college, or graduate degree, get the MacBook Air. 

If one travels a lot for business, one may be better off with the MacBook Air. My hunch: the MacBook Air will meet the needs for most business men and women. MacBook Air starts at $899. Buying "up" is a fairly significant jump in price: $1,199. With the latter one gets 512GB SSD storage vs only 256GB SSD storage in the less expensive model. With the "cloud" and peripheral hard drives, I'm not sure you have to have more built-in storage, but it is nice. It's hard to believe but I have only 125 GB on my "old" MacBook Air and it's close to maxed out even after "severe" management of storage.

College student: if your college student says a "MacBook Pro" is a must, a better deal: a MacBook Air, an iPad, and and  Pencil. Your college student will thank you.

The Gap Will Widen Between The Haves (Those Who Have Jobs) And The Have-Nots (Those Who Do Not) -- October 1, 2020

Maybe, I don't know; I'll probably go back to watching a few minutes of CNBC today. I haven't watched it the past two weeks. Waiting for the dust to clear. I'm curious. The one thing CNBC "never" mentions: the plight of NYC. Watching CNBC one gets the feeling that things are fine in Manhattan. But, wow, it must be quiet. Nope, I just turned on CNBC, same ol', same ol' -- will get the jobs number and turn it back off.

The fog is clearing: for a better understanding of how Covid-19 will play out, review the Pandemic of 1918, also called the Spanish Flu:

• lasted 26 months (a full two years): February, 1918 - April, 1920
• market did not recover for five years, though it hit bottom quickly and rose quickly; true V-shaped phenomenon; after five years, trajectory was pretty much straight up -- until 1929;
  
• no vaccine ever developed
• four waves of infections
• as far as I know, there was no Dr Faust recommending shutting down the global economy to "flatten the curve"; the whole thing was over in two years; after-shocks lasted for two to three years; assigning after-shocks to Spanish Flu problematic due to WWI
  
• Covid-19
• universal, inexpensive, readily available Covid-19 vaccine: we probably won't see that until late 2021; early 2022;
• we're now seeing second wave of infections of Covid-19, especially in states like North and South Dakota which didn't see much of the first wave;
  
• flattening the curve will result in simply extending the "length" of the pandemic
• the "best" viral vaccine -- the vaccine for "seasonal flu" is only 45% effective
• since 1999, the WHO has made recommendations for "best" flu vaccine
• twenty years later, and seasonal flu numbers have not changed; the world still experiences significant outbreaks (despite the vaccine)
  
• no pathogenic virus has been eradicated in "the wild" except for smallpox
  

Jobless claims, link here:

First thing I'll see: jobless reports, but first this:

WTI Trending Toward $39; No Wells Coming Off Confidential List; Time For Tea -- October 1, 2020

OPEC basket, link here: huge drop; OSP drops to $40.65. Saudi Arabia can't make it on $40-oil.

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Back to the Bakken

Active rigs:

$39.06	10/1/2020	10/01/2019	10/01/2018	10/01/2017	10/01/2016
Active Rigs	11	60	63	58	33

No wells coming off confidential list today.

RBN Energy: an update on Alberta's two PDH-PP plants and their appetite for propane.

In the past three years, two major commitments were made to construct propane dehydrogenation and polypropylene plants in Alberta to take advantage of the rising bounty and generally low cost of propane supplies in Western Canada. Two Calgary-based midstream companies, Inter Pipeline Ltd. and Pembina Pipeline, each started developing PDH-PP plants in Alberta’s Industrial Heartland area northeast of Edmonton. But then came COVID-19, which set back the timeline for one of the projects and put the other on ice. All this comes as Western Canada’s propane market is in greater flux than usual, and facing a tightening supply/demand balance as exports to Asia ramp up. Today, we provide a status check on the development of these two plants, and what the increase in demand might portend for propane balances in the next few years.

The increased role of unconventional oil and gas plays in Western Canada in the past decade has resulted in substantial growth of NGL supplies, including propane — too much propane, it often seemed. To make fuller use of burgeoning propane supply, Alberta’s provincial government in December 2016 initiated a royalty incentive program to promote investment in projects that would upgrade propane into value-added products. Taking advantage of abundant low-cost propane supplies and the government’s royalty incentives, two projects eventually came forward: one by Inter Pipeline Ltd.’s (IPL) Heartland Petrochemical Complex (HPC) and the other by a joint venture of Pembina Pipeline and Kuwait Petroleum Corp. (KPC). Both plants rely on the process of propane de-hydrogenation (PDH) to create polypropylene (PP), a primary chemical building block for everyday products such as automotive parts, plastic containers, and reusable shopping bags.

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Time For A Tea Party

Fast And Furious -- Fifteen Minutes -- October 1, 2020

GM:

• I was wrong. GM may be looking to take a bigger stake in Nikola. GM must have liked the video.
• why Nikola stock surges yesterday; The Motley Fool;
• GM-Nikola deal didn't close yesterday: GM might demand a bigger stake; link to Barron's; behind a firewall yesterday; not today; maybe because I'm using a different IP address?

Investing:

• stocks finish second straight quarter of big gains; link to The WSJ;
  

OPEC:

• in turmoil: getting worse as oil outlook worsens; link to Irina Slave;
• Saudi Arabia hit hard; link to Tsvetana Paraskova;
• Venezuela: see oil revenue drop 99%; link to Michael Kern;
• from $60 billion in 2013 to $0.5 billion in 2020

Job cuts:

• Disneyland went first; now the airlines: AA, UAL to cut 32,000 jobs; DC slow to provide relief;

Books:

• The Jefferson Bible review. I bought a copy of The Jefferson Bible years ago; not impressed. Don't know if I still have it or not; I've given most of my library away

Twin #2; grandson #2

Music:

• the making of Queen's "We Will Rock You"; link to The WSJ;

Lithium:

• one will start seeing a lot of stories on lithium; shortages, high prices, etc. But one thing remains: at the end of the day there will be a surplus of lithium. It may be expensive until supply and demand even out, but there won't be any shortage.
• major supply shortage; link to Tsvetana Paraskova;
• lithium recovery from oil and gas produced after (including the Bakken); link here to ACS Energy Letters;
• shale boom could fuel batteries; link to Earth: The Science Behind the Headlines;
• lithium: world class deposit, link to investingnews;
• see graphic below
  

Covid-19: best source for data, down to the county level.

• Cass County;
• Williams County;

Covid-19:

• insurers reducing coverage for telemedicine visits; link to The WSJ;
• why hospitals can't handle Covid surges; link to The WSJ;
• DOJ opens ventilator antitrust probe focused on Medtronic; link to The WSJ;

Divergent views:

• COP: oil demand will return and grow; link to Julianne Geiger;
• biofuels disappoint: link to story on Bayer at The WSJ;

Global economy / US dollar:

• a record level of global currency reserves -- $12.031 trillion; link to alKhaleej Today;

Later: how 'bout that lithium?