House Of Cards -- June 3, 2017

Updates

February 9, 2018: Hong Kong EV sales plummet when tax incentives dropped.

Tesla car sales in Hong Kong fell from 2000 to just 300 cars in one year, a crushing indictment of their competitiveness and … No wait, it’s worse:

• data from Hong Kong´s Transport Department shows Tesla sales fell to just 32 between April and December 2017, a dramatic decline from the near 2,000 sales notched up over the same period of 2016
• the removal of tax incentives in Hong Kong almost doubled the price of some Tesla models
• in total, including non-Tesla models, just 99 electric cars were registered in Hong Kong over the last nine months of 2017

It’s rare we see the complete evaporation of a market. In Denmark, when subsidies stopped, sales of EV’s and hybrids only fell by 60%.

August 29, 2017: Denmark has had enough. Denmark may greatly reduce taxes on automobiles. So much for the Paris Climate Accord. 

June 9, 2017: after EV sales dropped 60% in Denmark when the country ended tax incentives, Elon Musk traveled to Denmark to lobby the government to extend the incentives. Denmark buckled, but only to some extent. Story at Bloomberg. 

June 4, 2017: Toyota has sold final Tesla stage, bringing EV collaboration to a close. 

In the earlier part of this decade, Tesla partnered with both Toyota and Daimler, producing drivetrains for the electric Mercedes Benz B-Class. Daimler, too, has since split with Tesla and increased its commitment to in-house electric vehicle development.

The end of these relationships is both a positive and a negative for Tesla. It was never Musk’s goal, after all, to provide parts and know-how to legacy carmakers looking to dabble in electrics. On the other hand, Tesla must now more directly compete with larger carmakers as they expand their electric offerings, which some observers see as the single biggest threat Musk’s company faces.

June 4, 2017: from the dailyherald, Telsla's Model X misses out on America's voracious SUV hunger. 

While Tesla Inc.'s Model S has been a hit and thousands lined up to order the upcoming Model 3 sedan, the Model X sport utility vehicle hasn't met the chief executive officer's expectations. 

Model X deliveries have yet to keep pace with the Model S, as Musk predicted, and U.S. registrations of the SUV have slipped the last two quarters.

Musk has chalked up challenges with the Model X to making the vehicle too complicated. Features including the double-hinged falcon-wing doors have constrained production and contributed to a costly $82,500 starting price.

For Tesla, the lack of cheaper and easier to produce configurations has meant missing out on roaring demand amid America's SUV boom.

"Luxury SUVs are really hot right now, and the Model X should have been a big hit and broadened Tesla's audience," said Michelle Krebs, an analyst with Autotrader.com.

"You don't hear a lot of buzz about the Model X, and when you do, it's the negative stuff."

 Original Post

The full EV sales summary for May, 2017, has been released. Nothing remarkable. Of the 16,568 EVs said to have been sold in May, Tesla (S, X) accounted for 3,350 (1,620; 1,730) or 20% of the US market. [Later, nice update here.]

• Tesla: 20%
• Chevy (Volt, Bolt): 3,383 (1,817; 1,566): 20%
• Toyota Prime and Nissan LEAF: 3,300 (1,908, 1,392): 20%
• 29 other makes and models: 40%

And then, this article from Bloomberg: Denmark is killing Tesla and other EVs.

The electric car has dropped out of favor in the country that pioneered renewable energy.

Sales in Denmark of Electrically Chargeable Vehicles (ECV), which include plug-in hybrids, plunged 60.5 percent in the first quarter of the year, compared with the first three months of 2016.

The figures suggest clean-energy vehicles still aren’t attractive enough to compete without some form of subsidy.

Denmark, a global leader in wind power whose own attempt at an electric car in the early 1980s famously flopped, used to be enthralled with them. Its bicycle-loving people bought 5,298 of them in 2015, more than double the amount sold that year in Italy, which has a population more than 10 times the size of Denmark's.

However, it turns out that those phenomenal sales figures had as much to do with convenience as with environmental concerns: electric car dealers were for a long time spared the jaw-dropping import tax of 180 percent that Denmark applies on vehicles fueled by a traditional combustion engine. 

And then, this, of course, the myth of the resale value of Tesla EVs, over at SeekingAlpha. I still think an EV with the original battery at 5+ years has almost no resale value.

In the fall of 2015, the Liberal-led government of Prime Minister Lars Lokke Rasmussen announced the progressive phasing out of tax breaks on electric cars, citing budget constraints and the desire to level the playing field.

Tesla, whose sales were skyrocketing at the time, lobbied against the move.

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Slip-Slidin' Away

"I Did It My Way" -- President Donald Trump -- June 2, 2017

Updates

June 4, 2017: Trump's decision scuttles the EU-China summit on trade, global warming.

June 3, 2017: after Trump announces decision to exit the Paris climate accord, NYT with headline story: "new sheriff in town."

Original Post 

On November 23, 2016, this post from the blog: We've Had Two Lost Decades -- Will The Next Ten Years Be America's Decade?

Not exactly full decades but I was referring to the George Bush presidency as the first lost decade and then the Obama presidency as the second lost decade. ("Lost Decade" is a tag at the bottom of the blog. That tag first began with the Bush presidency.)

It is interesting that today's unemployment report reported the lowest unemployment rate in 16 years. Sixteen years: that's exactly two eight-year presidential terms. Amazing, isn't it?

We all know that full employment doesn't necessarily mean what it seems but one can't keep moving the goal posts. U3, U5, U6, whatever. And the goal posts the past 16 years has been U3 and now Trump has the lowest U3 in 16 years.

We're starting to see a lot of "positive" articles from fly-over country. For example: How ‘the Energy Capital of the Nation’ regained its optimism in the Trump era" in The Washington Post. Yes, The Washington Post. About the Wyoming coal industry.

First, note the headline (again, this is The Washington Post): "in the Trump era." Donald Trump has been president for less than six months. It's T+135 or thereabouts. And already The Washington Post is calling "it" the Trump era. Eras generally last a long time. For presidents, at least eight years and then whatever might follow from there. And generally, in politics, "era" is associated with "good times," like the Eisenhower era, or the Reagan era. I've not heard his era referred to as the Bush era. And surprisingly, I've not seen the headline, the Obama era. A google search proves me wrong, but colloquially the "Obama era" has a somewhat hollow ring to it. I suppose it has to do with "eras" needing to be associated with "something." No one can really list any Obama-era successes (except getting Bin Laden; healthcare; and ... well, that's about it). I certainly cannot list any successes during the "Bush era."

There would have been a Kennedy era, no doubt, but his presidency was way too short to qualify.

But here we are, less than six months into a new administration, and The Washington Post already headlines "The Trump Era."

[I think there's been more interest / more excitement in Trump's first five months than there was in Obama's entire eight years. The Sean Spicer show is "must-see television." SNL knows a good thing when they see it. On the other hand, Obama seems more exciting out of office than in office now that he's free to be himself, as he told Vladimir.]

A nexus word search is going to put "the Trump era" and "optimism" separated by one word (in). So we have: "optimism in the Trump era." Less than five months into his presidency. And almost no speeches (except at his "thank you" rallies).

Listening to talking heads on liberal business networks today suggested that if the three major indices had all hit new records and that unemployment was at a 16-year low and there were no new wars (yet) and inflation was not on the radar scope and Hillary were president, the talking heads would have been all over themselves exalting over the "miracle of Hillary."

Now back to the linked article. It's story about ... coal. You have got to be kidding. "Optimism." "The Trump era." "Coal." Six months ago, who wudda thunk (certainly not Hillary -- six months after THE loss, and she is a) still in stage 2 of the seven stages of grief; and, b) delusional).

So, here we are.

Less than five months into the Trump presidency, we already have the three major indices hitting record highs and unemployment at its lowest rate in 16 years. Ferguson is not burning; Baltimore is not imploding.

Walking away from the Paris climate accords sent a strong message to the rest of the world. Probably more than one message. Two messages:

• the voters who elected Trump were mad as hell and weren't going to take it any more; and,
• when his presidency is over, his theme song could very well be, I did it my way.

I Did It My Way, Frank Sinatra

Six Days On The Road -- June 2, 2017

Six Days On The Road, Taj Mahal

Current location. Watching our older granddaughter at water polo practice. In about 20 minutes we will be heading south, back to Grapevine. Should be a very, very interesting drive. Something tells me, it's gonna feel like six days on the road.

Week 22: May 28, 2017 -- June 3, 2017

Wow, this has been an incredible week. Despite the OPEC cut (wink, wink) global crude oil supplies actually increased during the first quarter 2017. The price of oil continues to fall and already the extension of the OPEC / Russia cut seems to be falling apart. One wonders if the current agreement will even amount to anything, now that two countries who have no caps (Libya and off-hand I forget the other one -- maybe Iran) are increasing their production. After months of naysayers telling us US shale could not "make up" the cuts in oil production by OPEC / Russia, it's now being reported what we all knew: The US could add up to 1.5m barrels per day to global oil production next year, nullifying the impacts from the deal, which was extended by nine months.

Meanwhile, the US economy is on a tear, at least by some metrics. There were no headline stories today but the US unemployment rate is at a 16-year low. Again, at a 16-year low -- and no one is dancing in the streets. It just doesn't feel that good. Meanwhile, US markets scored a hat trick: all three major indices hit new records this week.

My biggest surprise: President Trump made it crystal clear that the US was leaving the Paris climate accord. I would have lost that bet; I was sure he would have waffled, threading the needle, perhaps by saying the US would abide but he wanted the US Senate to weigh in. Both Ivanka and Jared failed to attend the Thursday afternoon announcement. The story will have legs through this weekend's Sunday morning talk shows and then will quietly go away, mostly because Germany's Angela Merkel doesn't want to admit she really, really blew it. Meanwhile, the US economic engine will gather steam to further widen the gap between the US and the rest of the world. 

International:
Global crude oil supplies increased first three months of 2017 (during the OPEC cut); perhaps this is why
US exits Paris climate "agreement" 

National:
The number of US rigs now back to pre-surge number and "more of the same" likely
US refiners are processing crude oil at a pace never seen before

Operations
BR to place 16 wells in one drilling unit 
CLR to place 12 wells in one drilling unit
Statoil to place 8 wells on one pad
Random update of Whiting's drilling program northwest of Belfield

Fracking
EOG reports a well completed with almost 12 million lbs of sand  
an MRO re-frack

Pipelines
Faulty story about faulty leak

Miscellaneous
Bhutan: North Dakota #1 in immigrants from Bhutan 

Hess With Seven New Permits -- June 2, 2017

Active rigs:

$47.74	6/2/2017	06/02/2016	06/02/2015	06/02/2014	06/02/2013
Active Rigs	51	25	81	188	187

 Seven new permits:

• Operator: Hess
• Field: Blue Buttes (McKenzie)
• Comments: all seven permits for wells in SESW 36-151-96 (see graphic below)

One permit canceled:

• Petro-Hunt: an Olson permit, in Mountrail County

The graphic: the general location for the wells proposed by Hess in today's Daily Activity Report; the seven will be in a single line, parallel to the south line; based on their names, they will run south to north.

Other wells in this drilling unit:

• 18053, 467, Hess, BB-State-151-96-3625H-1, t10/09; cum 256K 4/17; off-line much of the past six months;
• 24506, 1,065, Hess, BB-State-151-96-3625H-5, t7/13; cum 190K 4/17;
• 24505, 659, Hess, BB-State-151-96-3625H-4, t8/13; cum 120K 4/17;
• 24504, IA/827, Hess, BB-State-151-96-3625H-3, t8/13; cum 166K 4/17; off-line since 7/16; a sundry from says an NGL stripping unit was to placed; a pump placed and the well shut-in; I assume the same for the others
• 24503, IA/733, Hess, BB-State-151-96-3625H-2, t8/13; cum 90K 4/17; off-line since 5/16;