The EIA's Weekly Petroleum Report -- April 20, 2022

The EIA weekly report:

• US crude oil in storage decreased by 8.0 million bbls, vs a 9.0-million-bbl increase last week;
  
• US crude oil in storage now stands at 413.7 million bbls; 15% below the five-year average;
  
• US imported 5.8 million bbls per day last week; down by 159,000 bbls per day; over the past four week weeks, crude oil imports have averaged about 6.1 million bbls per day (yawn);
  
• US refiners now operating at 91.0% of their operable capacity last week;
• distillate inventories decreased by another 2.7 million bbls last week; inventories are now 20% below the five-year average;
  
• jet fuel delivered was up 15.7% compared with the same four-week period last year.
  

Distillate fuel:

Distillate Fuel	Date of Report	Change in Millions	Relative to 5-Year  average
Week 77	February 9, 2022	0.90	-19.0%
Week 78	February 16, 2022	-1.60	-19.0%
Week 79	February 24, 2022	-0.60	-18.0%
Week 80	March 2, 2022	-0.60	-16.0%
Week 81	March 9, 2022	-5.20	-18.0%
Week 82	March 16, 2022	0.03	-16.0%
Week 83	March 23, 2022	-2.10	-17.0%
Week 84	March 30, 2022	1.40	-16.0%
Week 85	April 6, 2022	0.80	-15.0%
Week 86	April 13, 2022	-2.90	-17.0%
Week 87	April 20, 2022	-2.70	-20.0%

Notes From All Over -- April 20, 2022

Netflix: worse than anticipated. In early morning trading down almost 40%; lost $130 / share; trading at $220. The 52-week high was $701. Oh, oh. This suggests investors feel there is a problem that is not necessarily transitory. 

Anticipation: Legacy Fund deposits should be reported today or tomorrow. Link here.

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

Market:

• strangest market I've ever seen;
• the only "market correelation" is an "inverse relationship" indicator:
• the lower the president polls, the higher the market goes
• needs to be fact-checked

Pre-market:

• all major indices green
• AAPL: up 1%
• SRE: flat to up slightly
• ENB: up  0.4%:
• EPD: up 026%
• CVX:  up 0.45%
• MNRL: up 3.25%
• DVN: up 1.35%
  
• BRK-B: up 0.43%
• UNP: flat to slightly negative
• NFLX: down an astonishing 28%; could open at 250, losing 100 points on open
• 52-week high: an astounding: $701 
• reminds me of Samuel Adams (BEER) from which it has never recovered
• "Streaming Wars" update here.
  

My favorite chart, money market fund monitor, link here:

MPC: switching from Russian oil to Ecuador --

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The Book Page

Illustrating J. R. R. Tolkien's The Lord of the Rings. Link here.

E15 -- Impact? RBN Energy -- April 20, 2022

PG: Procter  & Gamble posts its biggest gain in decades. Link to The WSJ.   

I just put a load of wash in and what did I use? PG's Tide. And I used cold water -- as PG markets the fact that Tide works just fine in cold-wash cycles. I'm lovin' it.

The Cincinnati consumer-products company said organic sales rose 10% for the quarter ended March 31, 2022, the biggest jump since P&G started tracking the metric 20 years ago. 

Organic sales is a closely watched figure that strips out deals and currency moves. 

P&G’s priciest offerings were in highest demand, the company said, continuing a trend that has persisted throughout the pandemic. 

Rather than switching to discount alternatives, consumers on average switched to even-pricier products, from fragrance-free diapers to high-end razors, P&G finance chief Andre Schulten said in an interview. 

“So far, the consumer is holding up and they clearly see the value in the superiority of our brands,” he said.

BKR, Baker Hughes:

• better than last year, but misses by wide margin
• five cents short of estimates; 15 cents per share -- holy mackerel, that's a wide miss
• shares fall 2% in pre-market trading
• last increased its dividend in 2017
• 2017: 17 cents
• 2018: 18 cents
• 2022: 18 cents
  

FCF, link here: 

FANG --> FAG? If so, everywhere but Florida. Link here:

DUCs, link here:

Oil: in a trading range?

• WTI: $102 - $106? 

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Back to the Bakken

Active rigs:

$104.20	4/20/2022	04/20/2021	04/20/2020	04/20/2019	04/20/2018
Active Rigs	36	15	32	63	5

No wells coming off confidential list.

RBN Energy: Biden turns to E15 as next tool to keep gasoline prices under control. LOL. 

It’s no secret that higher gasoline prices are a problem for a lot of folks, including everyday drivers, businesses and — maybe especially — the politicians who hear the complaints from the first two. Although prices at the pump have been trending higher for some time, they’ve really come to the forefront in the past several weeks following Russia’s invasion of Ukraine, which has stressed global energy markets and sent U.S. officials looking for any and all options to keep a lid on prices. In today’s RBN blog, we look at President Biden’s decision to allow the sale of E15 gasoline during the summer months, whether it’s likely to provide U.S. drivers significant relief from high prices this summer, and how global pressures are moving ethanol prices higher too.

The bottom line, as expected:

Altogether, the impact of the Biden administration’s move to allow E15 sales this summer will likely be negligible due to E15’s limited availability around the U.S., increasing costs for corn, and the much larger issue of global crude supply availability. Also, increasing costs for corn and ethanol could erode E15’s narrow price advantage over conventional gasoline.

It's very possible E15 could be more expensive than "regular" gasoline.

EIA Dashboards Have Posted -- April 20, 2022

EIA dashboards:

• EIA pdf, Bakken: https://www.eia.gov/petroleum/drilling/pdf/bakken.pdf
• EIA, pdf, Permian: https://www.eia.gov/petroleum/drilling/pdf/permian.pdf
• EIA, pdf, Eagle Ford: https://www.eia.gov/petroleum/drilling/pdf/eagleford.pdf

All three plays show decrease in "monthly changes from one average rig":

• oil:
• Eagle Ford, from 2,052 to 1,990, a drop of 62 bbls/day; a 3% drop;
  
• Permian, from 1,160 to 1,146, a drop of 14 bbls/day, a 1.2% drop;
  
• Bakken, from 1,879 to 1,847, a drop of 32 bbls/day, a 1.7% drop
  
• natural gas:
• Eagle Ford, from 7,370 kcfpd to 7,149, a drop of 221 kcfpd, a 3% drop;
  
• Permian, from 2,261 kcfpd to 2,234, a drop of 27 kcfpd a 1% drop;
  
• Bakken, from 2,630 kcfpd to 2,586 a drop of 44 kcfpd; a 1.7% drop;

On the other hand, all three showed an increase in overall production across the entire play.

Clearing Out The In-Box -- Nothing About The Bakken -- April 20, 2022

More global warming: April snowstorm knocks out power across northeast.

ISO NE: link here. Note: New York is not part of ISO NE. New York City: NYISO.

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

Housing Starts: March, 2022 -- Surprise

An unexpected increase in March, 2022. Link here.

• building permits increased but starts for single-family housing tumbled amid risigin mortgage rates
• housing starts:
• adjusted annual rate: 1.793 million increase vs a forecast of a decrease to 1.745 million units
• and, then look at this: permits for future home building increased at a rate of 1.873 million units
• was this the real reason why the market surged yesterday, after these numbers were reported?

Twitter 

Elon Musk story not yet over.

Covid-19 Vaccine

See below:

• there is now a global supply surplus
• JNJ does not earn a profit from these vaccine sales
• other Big Pharma said to be making huge profits on vaccine sales; links everywhere, here's one;
  

Mask

On-again, off-again:

• Biden says decision to wear mask is now individual choice; not a mandate
• within hours, Biden's DOJ says, "hold on, not so fast" -- there are bigger issues of control here:
• sounds like DOJ will confer with CDC on whether to appeal judge's decision that mask mandate exceeded CDC's authority
• recent rulings suggest the judge is on firm ground; could be risky for DOJ to appeal
• in addition, if mandate "naturally" expires as scheduled, it becomes a "moot" case, doesn't it?
• US Supreme Court steps in at some point; SCOTUS doesn't take "moot" cases.
• first take; much to play out;

The Apple Page

News:

• iPhone production "proceeding well" in Chinese city of Zhengzhou despite new lock downs and restrictions; MacRumors;
• Apple may have inked NFL Sunday ticket deal; very, very sketchy; but we should know soon who won: Apple or Amazon?

Sunday Ticket airs on DirecTV, but rights are up for auction as the NFL's DirecTV deal is expiring after the 2022 season. DirecTV paid around $1.5 billion for the games, but whoever wins the rights for the 2023 season will likely pay around $2.5 billion.

Should Apple win the bid for Sunday Ticket, out-of-market fans will be able to watch non-prime time games from all 32 NFL teams on Apple TV+. Sunday Ticket would join Friday Night Baseball, which Apple airs each Friday as part of a deal with Major League Baseball.

Netflix

Much more needs to be sorted out:

• big story; one report here; this was first time in ten years that Netflix lost subscribers.
• shares plunged after hours after report released 
• chart looks similar to Sam Adams (BEER) chart; BEER has never recovered;
  
• for investors, first question: where did those subscribers go?
• some suggest this is result of Covid lock downs coming to an end
• I never thought of that; tend to disagree
• there are better options out there; competition is severe 
• either way, doesn't seem to be good news for Netflix
• already looking for additional revenue streams, such as ad-supported options.
  

JNJ

Has huge day: shares rallied 3% following release of its 1Q22 results.

• EPS: $2.67 vs $2.58 expected;
• Whisper earnings: n/a.

Notably, J&J said it would suspend its guidance for COVID-19 vaccine sales due to a global supply surplus. 

But the company said that it does not earn a profit from these vaccine sales, so the change would not impact its adjusted earnings figures. 

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

Schwab Funds

SCHX or SCHG: Michael Fitzsimmons weighs in over at SeekingAlpha.

• edge to SCHG
• options:
• SCHX: 760 large-cap stocks, and tech particularly
• SCHG: broader portfolio; more than just large-cap stocks
• Fitzsimmons prefers "cobbling together a personal portfolio with the best-of-the-best"
• his own such portfolio is a four-stock "A-List Technology Portfolio" (sounds simiilar to Jim Cramer's "FANG" or "FAANG" or whatever it is now.
• of course, now, perhaps "N" for Netflix needs to be removed, giving us "FAG" or replacing Nvidia for Netflix
• Fitzsimmon's A-List Technology Portfolio: AAAB
• Apple, Amazon, Alphabet, Broadcom
• compare Broadcom (AVGO) with Qualcomm (QCOM) here;
  

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

Russia Joins An Elite Group

Russian stocks: Putin signs decree (I guess his version of an "executive order") to remove Russian stocks from overseas exchanges.

• more and more, Russia moves into elite foursome: Cuba, North Korea, Russia, Iran
• financial nuclear war: Russia leapfrogs Iran and North Koree to become the world's most sanctioned country; link to Fortune, March 8, 2022.
• it doesn't matter how much oil Russia "sneaks" to China, India, bottom line is this: without western technology, Russia's energy sector will eventually implode, along with Russia's financial system
• still waiting to see if Russia fails to meet bond obligation due April 4 (with 30-day grace period); tea leaves suggest that Russia won't pay; will be in default.
  
• folks are focused on the war; it's obvious this has become much, much bigger than a shooting war;
• Putin has set his country back fifty years
• China vis-a-vis Taiwan is watching closely

Amazon

And finally "news" that isn't news: USPS to slow down nearly a third of its first-class package deliveries (https://www.foxbusiness.com/lifestyle/us-postal-service-first-class-package-deliveries)

• Amazon, FedEx, USPS must have loved this "news."
• random thought: might Amazon ever go into direct competition with FedEx, USPS? Why not? I can already imagine the business model; it's not difficult. 
• maybe more on this later, but think about it this way
• when an 18-wheeler takes a cargo-load cross country, the driver wants to return home with another paying cargo; crazy to drive back home empty
• now think of the Amazon delivery; the driver brings the package to the door but then leaves empty; why now carry a package to be mailed with him/her
• at fulfillment center package would be shipped, and consumer would receive electronic statement / bill